On Friday, Jack Beatty, appearing on Tom Ashbrook's WBUR program On Point, honestly revealed all about the President's hope for a public insurance plan. Listen here starting at minute 23:50 for the introduction, and at minute 25:00 for Jack's own comments after President Obama's remarks in New Hampshire:
"It is disingenuous of the President."
"The fact is that the public plan opens to the door over time to Medicare for all."
"But the Democrats can't say that, and yet that is the fact."
"A robust public plan ... over time, is going to take more and more business from private insurers."
"This is backdoor single payer."
I made some of these points several weeks ago.
Whether you, dear reader, want a single payer or not, the issue now is Presidential credibility. Put aside the recent craziness about end-of-life care and other manipulated public outcry at town meetings. As I noted in July, real people have real concerns about the legislation and the legislative process. This showed up recently, too, in a recent New York Times poll. The President and his folks have wanted to hurry through a bill that affects one-sixth of the national economy, and when they hide their underlying philosophical intent, it undermines their chances. It deserves more time and consideration and honesty than that.
We will, however, get legislation. It will include new requirements for insurers to abandon nasty practices like denying coverage for pre-existing conditions and the like; it will create a national exchange like the Massachusetts Connector to allow individuals and small groups to shop around for better insurance products; and it will include subsidies for some low income people. It will not include the public plan, although there will be permission to establish local co-ops, like those that provide electricity to rural areas.
The House of Representatives will wait for the Senate to act first, because they want to be sure that a bill can pass the Senate. The need to get at least 60 votes in the Senate is critical. Why? Actually, not so much to avoid a filibuster, as to bring in conservative Democrats and moderate Republicans to get 50 votes. Yes, 50. For as things stand now, the Democrats can't even get a simple majority, much less a filibuster-proof majority.
The points to be worked out are the significant details:
How many people will get a subsidized plan? The numbers seen in the House are unreachable if the cost is borne solely by the wealthy. And since a broad-based tax increase is unlikely, the Senate will compromise with a lower number of families included.
How will the national exchange work? Will it be regulated by the states subject to national guidelines? Likely, given the prerogatives of the Governors. But this will mean a lack of uniform standards and plan designs. Will private insurers be allowed to participate in all 50 states? Will they have to?
Will there be a body that rules on efficacy and cost-effectiveness of new diagnoses, treatments, and medical equipment and supplies? Probably not, as manufacturers fear discouragement of new products and services.
The result will look a bit like Massachusetts: New rules for insurers to protect consumers; substantially greater, but not universal coverage; and some public subsidies paid for by progressive tax increases. I'd say this isn't too bad. It is not everything everybody would want, including myself, but the President will be able to sign a bill and claim victory. Given the amount of effort and political capital expended, though, it will be the last step for many years to come.
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31 comments:
Politics aside, credibility suffers when President Obama is shown, in video, from 2003 saying he would prefer a single payer system.
LINK
Now he denies ever saying that.
"I have not said that I was a single-payer supporter because frankly, we historically have had a employer-based system in this country, with private insurers, and for us to tran — transition to a system like that, I believe would be too disruptive"
LINK
Credibility FAIL?
Is this flip-flopping or nuance?
How do you think most people see this?
Jack Beatty speaks for Jack Beatty, and not for the President (he has lots of other people who can speak for him, off the record, if he so chooses). What Mr. Beatty is saying is what the single payer supporters are hoping to be true of President Obama (which is not necessarily what he is saying -- people have a fascinating ability to hear only what they want to hear).
The public option will become the "backdoor single payer" only if the private insurers are not able to offer something of value to consumers beyond what the public plan offers. None of the proposals give the public option an advantage in the market place (government subsidies, automatic price discounts, etc), so its only advantage will be to not have to generate profits for shareholders and not spending millions on finding ways to deny payments.
I support the public option as a way to instill competition into a stale market. I am fully aware that private industry will work tirelessly to undermine a public option (if created) to ensure that they are still able to offer something of value to consumers - they will work to limit the scope of the care paid for by the public option (to ensure a larger market for private plans); they will work to limit payment to providers to encourage physicians to opt out and only take private insurance; they will characterize the public option as "welfare" as to make private insurance more palatable to high-value consumers.
However, if the private insurance market evaporates (as single payer proponent hope) what of value did the private market actually offer our patients?
I believe the goal of health insurance reform is to cover as many patients as possible to make accessing and affording health care easier. The goal should not be to guarantee employment to those currently in the insurance industry, or increase the GDP via corporate profits. If private insurance cannot help us reach the goal of insuring our population, then we should let it fade away.
But I don't believe that will happen -- I have faith in our private business community will find a way to offer something of value in a marketplace that also has a public option.
I am suprised at your opposition to cost effctiveness research. As practicing physicians, this is the critical information we need, but do not get to make cost effective decisions. To say it will affect innovation may be true, but the problem is that current inovation functions in a fantasy land where if you design a new product, it may offer no better outcome than the old product, but you can still charge an exorbitant amount for your new "innovation". If not for the insurance system that hides the cost of this new product from the patient, this "innovation" would never occur in the first place since the "innovators" would never assume the risk of developing a product with a limited market and little proven efficacy over the old treatment. What the current system does is devotes too many resources to developing products that offer limited improvemnt over old therapies at increased cost. No such product would ever be developed or survive in a true free market!
I recall your example of your struggle with whether to buy a Da Vince Robotic surgical system, which costs a whole lot of money, but the jury is still out as to whether surgical outcomes are improved. Would not comparitive effectiveness research on this system have been of great benefit to you and to insurers (public and private) in deciding if the extra cost of this machine is worth it?
Keith,
You misread me. I am not opposed to that kind of research. Read my earlier post, the one whose link is embedded in this one. I am saying here, thought, that I don't think it will be part of the final package.
Paul,
I don't think I misread your post. It is just that the idea you believe we will not likely get this important piece in the legislation seems to suggest a lack of support. You also mention that it will stymie innovation (or at least manufacturers think it will) which also suggests that you do not see benefit or simply feel that we should kow tow to this special interest lobby whether the concept is right or not.
This issue I see as one of the most crucial to reining in health care costs. Without comparative research, we, as health care providers, have no scientific evidence to judge whether that new medication being heavily marketed to our patients and doctors is really worth the hefty price tag. I see lots of industry sponsored studies usually designed to play it safe and give the answer that the company wants to see. And I am very suspicious that negative results are often buried. It will take time, but the ability to conduct unbiased research comparing therapies for certain conditions is of vital importanceto slowing the cost increases in health care.
Chris made many great points. Mr. Levy, I think I understand why you are not a big fan of public option seeing you came from management background, but like Chris mentioned, if a public option is able to push out all private insurers and morph into a single payer system - that IS competition and market forces at play.
The only difference with the public option is the profits that won't have to be generated on people's sufferings - which is an important point why health care really should not be left in the hand of market forces to begin with. Most economics textbooks will tell us that barely any market in this world is truly efficient, and health care market actually has pre-existing conditions that prevent it from ever becoming efficient (consumers don't make rational decisions, no free flow of information, huge barriers to entry - list goes on). True, we let all kinds of markets in this world remain inefficient, but that inefficiency should stop when these markets involve human lives. Our society, claimed to be evolved and civilized, should provide a safety net to provide minimal protection to its people. One example is our fire departments - which we cannot deny that they have not failed us in times of crisis. What's so bad with government run entities? The government-run fire department is socialism according to the right wings, but I don't see people making a big deal out of them because there is no big profit margin to be made there.
I always see USPS offices filled with people, but somehow FedEx did not get pushed out. I would love to hear your thoughts about these arguments, but more importantly I hope you keep an open mind to the public option or a single payer system. many countries has it and they are much happier than we are - surely there must be something good about it.
A minor point re: Obama's credibility - it's not a certainty private insurers will be pushed out and this is a true backdoor single payer plan. Also, I'm glad he's rushing to pass the bill - if we lose the momentum listening to incumbent parties trying to keep their riches this reform might never happen.
Keith, in saying this -- "It is just that the idea you believe we will not likely get this important piece in the legislation seems to suggest a lack of support." -- you imply more than you should. I am giving my political prognostication, not my hopes.
Here's what I said in the previous post: "Create a national standards board that would review new medical diagnostics and therapies and equipment for cost-effectiveness, to supplement the efficacy determinations made by the FDA. Do not prohibit non-cost effective remedies, but make them ineligible for insurance coverage." That seems a pretty clear statement of my position on this.
an-follower,
Thanks very much for your comments. My point in this blog post was not to debate the merits of a single payer plan. I know there are well-meaning people on both sides of the issue. If you want more from me on that topic, go to: http://runningahospital.blogspot.com/2009/06/another-vote-against-single-payer.html.
By the way, the USPS vs FedEx example is so off-topic that I can't believe the President offered it. I have to think, along with Jack Beatty, that he regretted using it the moment he said it.
But, more importantly, if you choose to portray the debate on the health care bill as between "us" and "those with riches", I am afraid you are underestimating the feelings of the "us" from many walks of life who are concerned about the plans that have been floated. Those, too, are legitimate points of view that are not colored by being employed by insurance companies.
In Germany we are facing similar (though not as severe) healthcare issues. Being part of the system (as a patient) I always wonder where the money is going. Two decades ago my parents switched from public insurance to private healthcare insurance. All the recipies and bill now came through my father's hands and there were often times (not just once) where doctors had put something on the bill they never delivered. Here was the transparency and the flaws came up.
Normal healthcare insurance (in Germany) means that the patient never sees the bill and has no clue what money is transferred and why.
So a first step in making the change could be a move towards transparency (some steps have been already taken, see Paul's blog and the website of the BIDMC Medical Center).
Furthermore not only the specialists in the healthcare domain but the general public should get an understand what dynamics are going on in a healthcare system, that is not really to be seen on top.
In 2007 the NIH conducted a series of presentations on these dynamics and John D. Sterman explains in understandable manner how the rising costs are sure to rise even when healthcare plans (MainCare or similar) are working for a little while.
http://videocast.nih.gov/Summary.asp?File=13712
I think there could be a broader conversation being taken, and perhaps even inter-country wise (as the problems are pretty much the same), in order to find sustainable and doable solutions for the people who will need the service - and sooner or later it will be us as well.
Best regards
Ralf
Those, too, are legitimate points of view that are not colored by being employed by insurance companies.
A person doesn't have to be employed by an insurer to have their view colored by the insurers' interests.
Paul, what I ultimately take from the aggregate of your posts on the topic of an overall strategy for financing health services is that you are substantially in favor of the status quo regarding the role of for-profit health insurers.
My opinion of your calls for regulating the industry is similar to John Nance Garner's opinion of the office of the vice presidency, though I'd stick with Garner's original characterization.
It's perfectly understandable to me that you'd be very keen on keeping the current rules of the game as intact as possible, because your job is to look out for BIDMC.
New rules would be disruptive.
But perhaps you can answer a question that nobody else has:
What value do the for-profit insurers bring to the table? What value do they add to the system of providing and paying for care?
Jerry,
When you say this -- "It's perfectly understandable to me that you'd be very keen on keeping the current rules of the game as intact as possible, because your job is to look out for BIDMC. New rules would be disruptive." -- you draw the wrong conclusion. Whatever happens, with or without legislation, there will be disruption for my hospital and others.
In any event, I am not in substantially in favor of the status quo with regard to insurance companies. (BTW, why do you often take what I say, Jerry, and pull it to an extreme conclusion?) Read again what I wrote about requiring national standards, like those in MA, to prohibit discrimination against people with pre-existing conditions and other nasty habits of some insurers.
In your last question, do you mean to distinguish for-profit from non-profit insurers, or do you ask with regard to both? My answer is that society has often found value in having private enterprise take on the actuarial risks of life: Fire, theft, weather, calamities, liability, and health. I think there is value in that system. Perhaps you do not.
Beyond this, there are actually some insurance companies that engage in productive ways to help people manage their health risks and engage in preventative care and early diagnosis.
As I have said before, I do not regard health as an "actuarial risk" analogous to the other risks you mention. Your house may never burn down and you may never be robbed. Everyone, even those who are not currently clinically ill, needs health care. Conceptually,therefore, insurance companies do not belong in the business of health care, simply because they DO think in terms of 'actuarial risks'. Therefore, their goal is to minimize their risk, which is what leads to insurance company-like behavior such as raising rates on higher-risk individuals or excluding pre-existing conditions. Just as you have your auto insurance premiums raised if you are at fault in an accident. So we want to demonize and penalize them for behaving like insurance companies?
By that, I am NOT saying that I favor government-run or single-payer health care, simply that regarding health as an actuarial risk is conceptually
flawed. Porter's book expands upon this concept.
nonlocal
I think where we part company is that I don't believe it is flawed in concept, but I do believe the manner in which the industry is regulated can make an important difference by eliminating egregious practices. In contrast, I think that the logical conclusion of your position is, indeed, a government insurance plan. Someone, somewhere has to finance the sharing of risk across a population -- because no one of us can afford to take on that contingency. If it is not the insurance industry, it has to be the government.
I think the thing that is different regarding the non-health related disasters you cite is that the more you have, the more it affects you, so there is a clear supply and demand side aspect to pricing those risks. There is no such equivalence when it comes to diseases, illnesses, and accidents. Everyone wants the best care possible, and for people without insurance, they just want anything.
Whatever happens, with or without legislation, there will be disruption for my hospital and others.
Sure. But it's a question of degree. There's disruption, and then there's Disruption.
I expect that you'd prefer as little little-d disruption to BIDMC as possible.
You're running a hospital in Boston, which is not nearly the same as developing a comprehensive health policy for the whole country.
In any event, I am not in substantially in favor of the status quo with regard to insurance companies.
That's my conclusion after reading your posts on the topic. I've been wrong before, but that's the impression that I get.
I think that your calls for regulating the health insurance industry, however serious and well-intentioned, don't adequately address the fundamental problems of access and affordability.
I think your proposals are just nibbling at the edges, which is fine if the goal is to achieve marginal/incremental improvements, like building a car with fewer bolts or saving 90 seconds (or 4 minutes) on a routine admission. Yeah, those little pieces add up when the volume's high, and when they're added to the sum of other little pieces, but that's not nearly enough given the scope of our shared problem.
(BTW, why do you often take what I say, Jerry, and pull it to an extreme conclusion?)
I just read your direct comments on the subject, along with your assessment of the politics. I've been wrong before, but that's the impression that I get.
Read again what I wrote about requiring national standards, like those in MA, to prohibit discrimination against people with pre-existing conditions and other nasty habits of some insurers.
Eliminating denial of coverage based on pre-existing conditions is an absolutely essential piece of the puzzle, but by itself doesn't address the fundamental problem.
If I can get a policy that covers a pre-existing condition, but the cost of that policy is prohibitive, what have your proposed national standards accomplished?
I also take issue with your use of the term "nasty habits."
Your phrase makes the routine practices of for-profit insurers, practices which you avoid actually naming (wanna talk about rescission?), seem almost benign, like the misguided pranks of boys who you would insist are essentially good.
That said, I'm glad to see that you've started using the term 'egregious.' That's a little bit closer to the truth.
There's more, but let's stop for the moment.
Thanks, Jerry
Well, Jerry, I guess you will just continue to take issue with the terms I use and make assumptions about my motivation.
But to get back to the topic of this post, a prediction of what is likely to happen, note today's New York Times: http://www.nytimes.com/2009/08/17/health/policy/17talkshows.html?_r=1&hp.
"The White House, facing increasing skepticism over President Obama’s call for a public insurance plan to compete with the private sector, signaled Sunday that it was willing to compromise and would consider a proposal for a nonprofit health cooperative being developed in the Senate."
"...Kathleen Sebelius, the health and human services secretary, said the public option was “not the essential element” for reform and raised the idea of the co-op during an interview on CNN."
The President is a practical person, and he will do what he needs to to get a bill through.
Yeah, Paul, the NYT's header today is consistent with that in the WSJ, etc. and is the latest manipulated narrative to emerge.
Personally, I believe it's more wishful thinking on the part of folks who oppose fundamental change than it is a reflection of what's actually happening.
First - there is not yet a bill. There are several bills that have been reported out of committee, including Senate HELP and House E&C.
But there is no bill.
Second, the 6-member subgroup in Senate Finance has yet to put something before the full committee. Baucus (D-MT), Conrad (D-ND), Bingaman (D-NM), Snowe (R-ME), Enzi (R-WY) and Grassley (R-IA) are the insurance industry's firewall who collectively represent less voters than...what, Indiana?
And a public option consistently polls support from a majority of voters nationwide.
Third, Baucus' gang needs to get their bill out of committee. I'm not sure that they will.
If they do, it's still subject to substantial revision if/when it's incorporated into a final bill.
Fourth, members of the House progressive caucus have stated that they will vote against a final bill that does not include a robust public option.
As for the alleged need for some level of "bi-partisan support," the repubs have shown nothing but bad faith. None will support reform in the House - the Blue Dogs there are acting as the counter-balance, and most will vote yes on a final bill.
Fifth, there's a need for only 51 votes in the Senate. I don't know who did your whip count, but it's not at all like mine.
I'm no fan of Harry Reid, but approving the final bill through the process of budget reconciliation with a simple majority is still very much an option, and I expect that option to be the one used in the end.
As for a fillibuster - I would love to see the repubs try to pull that off. It would result in them losing Senate seats in every state but WY, UT, AL, and AK.
Bring it on.
Finally, I don't make assumptions about anything you say. I try to analyze and reach my own conclusions, which may be correct, or not.
But your calling them 'assumptions' is yet another example of something else I've observed - you may find my tone 'nasty,' but I think you sometimes come across as pretty patronizing and dismissive.
My opinion, anyway.
Thanks, Jerry
Paul;
As usual when discussing this concept of insurance companies in medicine, I have difficulty making myself clear. The "flawed concept" to which I refer has to do with the mindset of insurance executives, and also with the public's (including yours) attitude that health insurance companies should somehow behave differently than other insurance companies.
Insurance executives are all about minimizing their risk. Therefore, any insured person who maximizes their risk is not a desirable customer. An insurance company makes no effort to tell you how often to get new brakes on your car, but if you crash the car due to faulty brakes, they will raise your rate. If you continue to crash your car for whatever reason, they will drop you.
They do exactly the same in health care. They do not tell you how to maintain your health (except for a very few), but they raise your rate and/or drop you if your health fails enough times or severely enough.
But in health care insurance, you yourself call this "egregious behavior". Is it egregious to drop someone's car insurance after multiple accidents? Do you see my point, despite minor inaccuracies in the analogy?
Therefore I am saying we need private companies which do not have an insurance executive's mindset - companies which still take your "premium" money, but provide a service for it which includes acting as a patient advocate, using their resources to help find you the health care providing the most value (remember, defined as patient outcome per dollar spent) for your health condition(s); providing educational services and incentives for maintaining your health, etc. etc.
This category of company, while perhaps still technically an insurance company, functions more like a typical service-providing company, and is run by people with a service-oriented mentality, rather than an insurance mentality. That's all I'm saying. Again, Porter's book expands upon this idea. I'm going to have to get it back out of the library....
And ps, yes, you can regulate insurance companies, but they will do everything they can to game the regulations, because they STILL want to minimize that risk, because they think like insurance companies! It's ultimately a no-win situation which will cost everyone more - especially people like me in the private insurance market.
nonlocal
nonlocal directly addresses a concept that I believe you've consistently dodged, Paul.
I think his (her?) comment that insurers will do everything they can to game the regulations cuts to the chase.
Speaking of dodges, you didn't answer my earlier question, specifically about what value, if any, insurers add to the process of providing and paying for health care.
Can you describe, articulate, enumerate, or otherwise set forth any added-value that health insurers bring to the table?
Thanks in advance for your reply, Jerry
I answered the question above: "My answer is that society has often found value in having private enterprise take on the actuarial risks of life: Fire, theft, weather, calamities, liability, and health. I think there is value in that system. Perhaps you do not."
C'mon, Paul. That's not an answer. Not in the least, most remote and generous sense of the term.
All you've done is string words together.
The question's pretty clear -
Q - What value does the health insurance industry add to the process of providing or paying for health care? What parts of the overall transaction do they enhance? What do they contribute to efficiency or effectiveness?
The answer's obvious - the health insurance industry adds no value. None.
If there was a coherent answer, I'd expect you to be able to provide it.
That's why you can't answer it. That's why you won't.
'nuf, Jerry. You can't hear what I'm saying, and I don't have another way to say it. That does not mean it is not a coherent answer. It means we speak different languages.
Hey Jerry;
I think you would enjoy The Health Care Blog, which contains much of the political sparring and more no-holds-barred exchanges that you seem to enjoy. (You will especially like a commenter on there named Nate.) That said, I believe the blog does provide some good information; it just has a different tone than this one. I read it daily also.
nonlocal (female, BTW)
Thanks for the tip, dr/ms nonlocal. I'll check it out.
I'm not so much a fan of "political sparring and more no-holds-barred exchanges" as I am a fan of honesty, especially when a blogger repeatedly portrays him/herself as a proponent of transparency.
Paul, I have no idea what you mean about "different languages."
Mine is English, and I strive to achieve some level of clarity while making sure that my voice still comes through.
That means avoiding jargon, techno-babble, and the sort of bureaucratic blandness + Palinesque gibberish that's often used to rationalize the indefensible.
What exactly do you call this thing that you're doing?
Dear Anon 10:04,
Thanks for the sentiment, but I am sure you can understand why I can't publish your comment.
...I am sure you can understand why I can't publish your comment.
Which of course leaves the rest of us to only wonder...
Cute.
Has it ever occurred to you, Paul, that this blogging thing just might not be your gig?
Instead, you might consider printing out your thoughts, having your secretary Xerox copies to pass along to friends and family, then walking away before they have time to respond.
Seriously, I don't think you're cut out for this.
My opinion, obviously.
Jerry,
This was the only way to respectfully send a message to the person submitting the comment, as I did not have his/her email.
Hmmm, respect.
So, why couldn't you publish the comment?
Since you're not likely to answer that one, here's a distracting nugget -
"...cooperatives aren't stirring up opposition from insurance companies or health-care providers because they see nothing to fear."
That's not me assuming anything about anybody.
That's Jonathan Weisman reporting what "One health-care lobbyist said..." in yesterday's WSJ.
But, really, who can believe anything in that paper?
Keep my Xerox idea in mind, OK?
Jerry;
Your weird comments made me curious enough to review your own blogs. They seem fairly thoughtful, so I gotta ask - what's your problem, man? You don't like your own hospital's administrator or something? I feel like I'm reading the democrats' version of Rush Limbaugh (whomever that may be; I'm politically agnostic)
Peace out, dude.
nonlocal MD
Yo, nonlocal:
Since I don't know what you mean by "weird," I have no way to respond.
what's your problem, man?
I never would've thought you were into pop psychology. I'm not - it's silly.
I don't cross paths with my own hospital's ceo - he doesn't blog. He's got a vp/nursing to look after his interests, while I have elected reps to look after mine.
If you think you're reading the "democrats' version of Rush Limbaugh," then I guess you know nothing about Rush Limbaugh.
Anywhoozle...it sounds like you have a hard time with my blog comments.
If this was a tea party, and we were all sitting around a table, you'd probably feel more comfortable if I just kept quiet whenever Paul said something that I thought was stupid.
What would be the point of that?
I expect Paul could make the trains run on time, if that was his job. I can dig that. It's a skill I respect.
But I find many of his takes on health policy to be pretty reactionary, and tainted by his own self-interests.
I can't just let his stuff pass by unchallenged is all. It's nothing personal.
If that's hard for you, well - that just is not my problem.
You know?
Mr. Levy,
Thank you for your comments - I do respect that people have differing opinions on this issue, and our goal is not so much to change each other's opinions but to inform one another so that we can make informed decisions on our own.
Of course, "us" represents, among various walks of life, lower-income families AND physicians, whom I have seen voted for McCain because they did not want to lose earnings should a new reform comes along with Obama. They view high earnings as incentives to attract good people into their field, and without incentives hospitals and physicians don't perform as well. I can understand that, but sometimes I have to wonder if we can't do better than money and incentives - this is people's lives at stake, somehow I hope it's regulated not by money but by the sentiment "I want to help people" that are told by medical school applicants. I think in healthcare, we need a higher incentive because so much more is at stake, but that might be too much to ask from human beings.
I'm not sure if USPS and Fed-Ex is so off-topic. Sure, it's not a twin analogy to healthcare, but if the right wings keep piping about socialism and the bad government-run entities, USPS is but one example that I hope would compute for some. Maybe the fire department is a better one =|
I'm sure you're away of Maggie Mahar, another avid blogger on healthcare. She has many great points, and I share her sentiments. I would appreciate it if you would be interested in reading her blogs - you wrote in one of your posts that your views of healthcare has changed once you entered the industry - maybe this will sway you one way or another: http://www.healthbeatblog.org/
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