Tuesday, July 30, 2019

"Money Talks"

Yeah, I mentioned this before:
This at least gets at a basic issue in this debate which has drawn very little focus, at least in the political realm if not among policy analysts. Current Medicare itself actually doesn’t eliminate private care. Roughly a third of beneficiaries choose a Medicare Advantage private plan. This is still significantly different from anything that now exists in the private market. These are private plans but they have to abide by a tight regulatory framework defined by Medicare. Of course, beneficiaries can opt back into traditional Medicare or choose a different Advantage plan if they choose, so that provides competition beyond the regulatory regime.

The other side of this is that Medicare pays the bills for a population that needs medical care, but can't pay for it.  The burden on the hospitals alone would be ruinous without Medicare, which is why hospitals accept the lower reimbursement rates of Medicare:  it's better than being stuck either turning people away (the optics of that are horrific, because these aren't the invisible homeless) or treating them without compensation.

My 90 year old mother has been in the hospital more in the past 2 years than my family has been in 42 years.

That is the other issue, the one no one wants to mention; the same issue that made Obamacare such a horse-designed-by-a-committee mess that it is.  I heard this morning about two patients presented with medical bills in the range of $1 million because their hospitals were "out of network."  The problems of surprise billing are all the rage.  But the problems of fixing it present the problems of "Medicare for All":

Those stories got the attention of [California] lawmakers, who put together legislation that would take two key steps. First, it would prohibit providers from seeking those extra payments directly from patients. Then, it would instruct insurers to pay providers a set amount, based on what the providers would normally get from insurers, with an option for the providers to petition for additional payments if they thought the amount was too low.

It is the same approach California’s existing legislation takes for the limited groups of people it already covers and, broadly speaking, it is the same approach now under consideration at the federal level, where legislation to end surprise bills has slowly generated bipartisan support in both chambers of Congress. Even President Donald Trump has said he wants to do something about the problem, which means the proposals are likely to become law if they make it to his desk.

But, as the California story shows, that is a huge “if.”

Providers, especially hospitals, have gone to war over the state’s billing proposal. They insist they are all in favor of protecting patients from surprise bills. The problem, they say, is the remedy. The California bill would, in effect, force out-of-network providers to accept some form of Medicare or in-network reimbursement rates, or some blend of them. That would be less than the providers can charge now, obviously, and it would also set a precedent ― namely, allowing the government to dictate their fees.

Doctors and hospitals have a lot of clout in Sacramento, as they do in most state capitals. As Anthony Wright, executive director of the consumer advocacy group Health Access, quipped to HuffPost, “We have 450 hospitals in California and we suspect that each of those CEOs has the personal cellphone of the assembly member from the district.”

Supporters managed to get the bill through the State Assembly but two weeks ago its co-sponsors, Assemblymember David Chiu and Sen. Scott Wiener, tabled the measure (meaning they will hold it over until 2020) just as the Senate was preparing to take it up.

They didn’t mince words about why. “This bill curtails a practice that generates billions of dollars of profits for hospitals, and lobbyists and CEOs for the most profitable hospitals in California have made it abundantly clear they will protect profits over patients,” Chiu and Wiener said. “That level of moneyed opposition proved insurmountable at this time.” 
The "level of moneyed opposition" is what turned Obamacare into such an unholy mess.  Not all of that opposition came from insurance companies, but they got the lion's share of the blame.  Would that it were so simple, in the end.  If Kamala Harris, as Josh Marshall argues, is misreading polling on support for "Medicare for All," the rest of us are misreading reality.  I don't really buy the argument that everyone "loves" their private insurance; if that were true, no one would love Medicare, and people on Medicare love it because it pays the bills and, especially if they buy an inexpensive (well, compared to market costs for full insurance) supplemental plan, they never pay a dime (I pay my mother's bills.  I've never paid one to a hospital or doctor, and never received any "suprise billing."  I have had that experience on my insurance, but not on her Medicare.).  Doctors and hospitals accept Medicare because the cohort is small and payments reliable, and because it isn't socially (or morally; doctors are people, too) acceptable to just let old people die.  Expand that to the whole population, and suddenly reimbursement rates plummet.  The moral imperative also shifts rather dramatically, and at least since the time of Nixon we've had it drummed into us that the business of American business is business; and medicine functions in this country as a business.  That is a problem that will "solve" Medicare for All long before Medicare for all solves that problem.

Some institutions, especially the ones with clout, are going to be in opposition; but it won't be just  the "evil insurance companies."  And besides, everyone loves their insurance; they just despise the companies they don't get their insurance from.  How much more do they love their doctors, and their hospitals? Everybody loves their doctor, hospitals are ridiculously expensive, but who wants less hospital care? Do you want to go back to renting a TV? Or return to 1950's technology? If we make healthcare affordable, can we also make housing affordable? Both should be done, but is either just a matter of one simple law?

There's not going to be a simple solution to this, and it's not going to be because of politicians misreading poll numbers.


  1. There are also any number of related issues. What happens to the 800,000 people that currently work for insurance companies providing health coverage? Individually they, and their families will oppose a complete elimination of insurance. A big driver of medical costs are salaries. Ok, pay doctors less. How do they then pay off their med school loans? Who would go to med school and take on that debt if it can't be paid off? Same goes for nursing and other medical fields. California and Massachusetts have their uninsured rates under 5% with aggressive use of Obamacare and state actions. Making Obamacare better and targeting the last 5% seems much more doable without having to tear out root and branch 18% of the economy. Universal healthcare is within reach if we can manage to not trip over our own feet.

  2. Bernie this morning, from excerpts last night, kept painting drug cos. and insurance cos. as the reason we can't have nice things. It's a similar argument to oil companies being the reason we all rely on petro-chemicals in an industrialized world.

    Aliens didn't invade and force these things on us. We can join the rest of the civilized world and have universal healthcare and control drug prices and lower medical costs; but we can't do it at one stroke of the Presidential pen. Even Medicare wasn't implemented all at once as it stands now.

    And we aren't going to be there by demonizing some "other" and going after them with rhetorical torches and pitchforks.

  3. Your last line got me thinking, Sanders and Warren were asked how they would deal with the problem of unaffordable rents. Warren has a plan to add 3.2 million housing units, Sanders said he would stop yuppies from gentrifying neighborhoods by building luxury condos. One is a solution, more housing should help increase the supply and reduce prices, the other is demonizing a group. As someone pointed out, yuppies aren't going to live in campers if they don't get condos, they will still drive up demand. Even luxury condos increase supply (as long as they aren't displacing anyone). It sounds good to rail against banks, insurance companies, the 1%, yuppies, and they may be right where those groups exercise political power for their own benefit at the expense of the public. But in almost all those cases, the solutions are complicated and it would be more productive to go after underlying causes. Yuppies may (or may not) be part of the housing problem, but so is zoning, transportation, how housing construction is financed, etc.