Will Force or Favor Make People Buy Health Insurance?

The mandate that everyone buy health insurance by 2014 is facing a lot of legal challenges. Recently, a federal judge in Virginia decided that the mandate is unconstitutional. There are currently 24 lawsuits challenging various aspects of the Patient Protection and Affordable Care Act, according to a chart created by the Washington Post, with the insurance mandate a top source of friction.

Having both healthy and ill people purchase health insurance distributes the cost of care among both. A responsible society shares expenses for the common good. We don't expect children to pay for their public school education, for example, but expect that they will pay it back when they use their education to get jobs and become tax-paying adults themselves. Similarly, if we want to expand and secure access to health care, we need to all contribute to the expense - even if we are not deriving immediate benefits from our contributions. At some point in our lives, as injuries and illnesses occur, all of us will probably cost insurers more than we are currently contributing in premiums, and we will depend on the contributions of healthier people to cover the cost of our care.

But how do you make sure that enough healthy people purchase health insurance to adequately distribute these costs? Since legislation, now being challenged in the courts, might not work, Fierce Healthcare ran an article on some ways to pay for health care reform even without the individual mandate. Fierce Healthcare drew on a Kaiser Health News story ("Experts Ponder 'Plan B' Options For The Individual Mandate") for ideas, such as:

• Use taxes as an incentive. Raise taxes, then give tax breaks to people who have purchased health insurance.
• Use premium cost as an incentive, as suggested by former CMS director Gail Wilensky. Increase the cost of health insurance for several years for people who do not purchase it when they are first eligible. 
• Use a waiting period as an incentive, as suggested by sociologist and senior health advisor Paul Starr. Prevent those who opt out of insurance from purchasing subsidized insurance on the insurance exchange for several years. Insurers also would not be required to cover those who opt out if they had pre-existing conditions.

As these ideas demonstrate, where persuasion doesn't work, stricter financial penalties often do.

More Fees, Less Health

With open enrollment coming up, Kaiser Health News' Michelle Andrews wrote an interesting article about how health insurance costs may increase for consumers with the new health care reforms in place. The potential costs, which will especially impact people with family coverage, include:

• Higher premiums and deductibles. Employers and insurers are passing on greater amounts of the cost of health insurance to their employees. "In the past five years, employees' premium contributions have grown 47 percent, while overall premiums increased 27 percent," wrote Andrews. Furthermore, over 25% of employees pay $1,000 or more in an annual deductible that must be paid before the insurer picks up any costs.
• Both co-pays and co-insurance. In addition to small, flat rate co-pays to visit doctors, some health insurance plans will also require people to pay a percentage of the total bill (co-insurance) for hospital stays, ER visits, and/or prescription drugs. Co-insurance is usually about 10% to 30% of the bill, according to a New York Times article on insurance changes.
• Surcharges for dependents. Some insurers will charge extra for each dependent on a plan. Other insurers might charge a surcharge for employed spouses who have access to other insurance through their employers, hoping to drive them off the family plan.

These extra fees seem especially painful in light of a recent Commonwealth Fund study that found that Americans are faring worse in health outcomes than their counterparts in other countries. The 30-year study looked at health care costs and 15-year survival rates for 45-year-old men and women and for 65-year-old men and women, in the United States and in twelve other wealthy nations.

"The United States now spends well over twice the median expenditure of industrialized nations on health care, and far more than any other country as a percentage of its gross domestic product (GDP)," wrote the study's authors, Peter A. Muennig and Sherry A. Glied, in the journal Health Affairs. Although U.S. survival rates have improved during the study time (1975 to 2005), the improvements were greater in the other countries in the study.

The study looked at the impact of population diversity, smoking, obesity, traffic fatalities, and homicides on the health of Americans, but found that these factors did not contribute significantly to the health differences between the U.S. and other countries. Instead, the authors concluded that the high cost of health care might be making the U.S. fall behind the other countries. For example:

• High health care costs have made insurance unaffordable for many Americans. The number of uninsured Americans rose during the study period, and going without health insurance affects both short-term and long-term health.
• High health care costs might divert money from important public health campaigns. "At current spending levels, investments in public health, education, public safety, safety-net, and community development programs may be more efficient at increasing survival than further investments in medical care," the authors wrote.
• Expensive fee-for-service care and the rise of specialized care might lead to unnecessary procedures and poor communication between a patient's different health care providers. Complications from unnecessary procedures and medical errors from poor communication might contribute to Americans' poor health outcomes.

Ideally, health reform will ensure that more Americans have health insurance, create incentives to support public health programs, and reward the medical community for focusing on cost-effective, coordinated preventative care. If consumers become healthier because of these initiatives, insurers will save money on treatment costs. But since we're not there yet, insurers still view Americans as unhealthy and costly, and will continue to charge them heftily for that.    

219 Democrats

With gangs of protesters roaming Washington, D.C. this weekend, and Republican congressmen egging them on by holding up "Kill the Bill" signs from the Senate balcony (see slideshow), with spitting and name-calling, with emotions and political influence tangled up together on both sides of the abortion debate, the Senate's health-care bill narrowly passed in the House of Representatives on Sunday with 219 votes (all Democrats).

On Tuesday, President Obama is expected to sign the bill, as the men and women of Congress continue to hash out the details of reconciling the Senate and House versions. It seems that health care reform is all over but the shouting, and there's been plenty of that already.

I've been in favor of health care reform for a long time, primarily because I believe that it would keep Americans healthier and protect them financial ruin if they do become seriously ill. Thirty-two million uninsured Americans will be covered by this new bill, easing the considerable logistical and financial strain that the uninsured place on our emergency rooms and hospitals when they don't have access to regular medical care that can keep them out of the ER and hospital in the first place.

The bill will also make health insurers take more responsibility for the people who pay their premiums. Health care insurers will now be required to invest in preventing disease (and ultimately saving money on health care costs) by covering annual check-ups and and childhood immunizations. Reform will create larger pools of payees, including healthy young adults, to offset the costs of treating the patients who have expensive (often chronic) illnesses, and eliminate the lifetime cap on how much health care an insurer will provide to a patient. (Note to uninsured twenty-somethings who will now need to purchase health insurance: some day you, too, will have an expensive and/or chronic medical problem, for which you deserve - and no doubt will demand - quality care.)

Recent headlines such as "Eight healthcare lobbyists for every member of Congress" (Fierce Healthcare) and "Big Jump in Blue Cross Premiums Sparks Outrage" (San Francisco Chronicle) have made it clear that health care consumers have had little influence, and their needs have not been met, under the current insurance system. It was time for some legislation.

The Washington Post has an interesting chart showing how the House members voted, how much funding they get from the health care industry, and the percentage of uninsured people in their districts. Wondering how reform will affect you? The Post's interactive graph explains the costs and benefits of the bill, based on your income, marital status, and the size of your family.

Two Good Ideas for a Bad Economy

Deductibles and health insurance premiums are going up rapidly, according to the latest Kaiser Family Foundation Employer Health Benefits survey, especially among small businesses. About two-thirds of small businesses offer health insurance plans to their employees, and of those about one-third of the plans have a yearly deductible of $1,000 or more, according to the survey. Average health care premiums paid by employees have risen five percent since last year, and roughly doubled since 1999.

In response to this trend, the Blue Cross Blue Shield Association has partnered with state governments in Oklahoma and Arizona to develop a health care premium subsidy program for small businesses with 50 or fewer employees, CQ HealthBeat News reported recently. Close to 20% of the population in both states is uninsured, according to the article. Over half of the employees who signed up for the Oklahoma program (called Insure Oklahoma), had been uninsured previously. Advocates of the partnership hope that these subsidies will decrease or eliminate the number of uninsured people in these states, CQ HealthBeat News reported.

Another good idea in today's economy: vegetarianism. A NewScientist.com article in July cited a Cornell University study that showed that if all Americans ate a vegetarian diet (unlikely, I know, but possible), they could reduce the amount of fossil fuel used to produce food by one-third. Producing animal products consumes far more energy than producing plant products for human consumption. Plants such as feed corn must be grown and transported to animals in another field in order for the animals to grow large enough to eat. Then the animals or their dairy products must be processed and transported to the grocery store. Corn meant for human consumption only takes one field and, once harvested and processed, is transported directly to the grocery store.

The health benefits of eating a plant-based or plant-biased diet are well documented. Eating less meat and dairy and more fruits, vegetables, and grains can save money on both energy costs and health expenses. Eating more plant products might not be a radical idea, but it could directly impact the troubled economy.

The Price of Being a Patient

Whatever benefits modern medicine has for patients, I've experienced first-hand its power to undermine your ordinary life. In the spring, I switched primary care providers when I became frustrated with my long-time PCP's sluggish response to several urgent medical problems. When I gave my new PCP a sticky note listing a few medical concerns of mine at our first meeting, however, I inadvertently triggered an avalanche of medical appointments. She gave me a few referrals to specialists, including physical therapy to resolve some old injuries, and as I dutifully worked my way through the list I watched my time slip away. Add to that several medical checkups for my children, and the time drain was enormous.

Perhaps unwisely, I added it all up: six medical appointments in April (one of them for a child), and nine in May (one for a child). Some were mercifully clustered around a medical campus in the north part of city, some in the south part of the city, and two were east or west of the medical campus. Some providers collected co-pays on the spot, and others sent a big fat bill later on ("What's this?" my husband asked, waving an itemized list of co-pays in the air recently). To complicate things further, my insurance company periodically sent me bills for provider visits recommended by my PCP that they only covered partially.

My experience was typical, according to a poll of women's views of health care released today by the American Academy of Family Physicians (AAFP). The Harris Interactive poll of 1,270 women, commissioned by the AAFP, found that cost and time constraints were the top challenges women faced in obtaining health care for themselves and their families (in San Francisco, I would add "parking"). The AAFP used the poll's data to advocate for a medical home model, where all medical care is coordinated through a primary care physician and streamlined through technology such as electronic medical records, e-prescribing, and emails between patients and providers.

Considering the number of uninsured Americans, I'm supposed to write that I'm grateful to have decent medical insurance -- which I am, of course. I'm also grateful, however, for the new clients I gained in May, whose work, out of necessity, took up many nights and weekends this month as I juggled interesting new assignments with a relentless march of medical appointments. I'm equally grateful, as these appointments wind down at last, that I'm not coping with a chronic condition that requires frequent provider visits, and co-pays or bills for visits, prescriptions, or durable medical equipment.

At the end of May now, I have finished my assignments and met my target number of work hours, although I spent less time than I wanted to with my children. Luckily, I managed to squeeze in a weekday off to play hooky with my older daughter recently, who had a rough month at school. We both needed the break.

Health Care Reform's Impact on Business

I think that the health care system will be fixed gradually with the next administration. Perhaps the new president will kick-start health care reform with an action designed to build goodwill toward the process, such as an announcement of federally-subsidized catastrophic coverage or medical debt forgiveness for a small segment of Americans, and build out slowly from that.

If employers no longer need to purchase private health insurance for employees, they might need to pay into a local, state, or national health care plan fund. If the plan (either government-based or private) is structured and administered well, with a reasonable level of services for patients and reasonable reimbursement rates for providers, it can provide better care at a lower cost than the patchwork of plans currently available. The debate about the cost of such a plan is raging in San Francisco now, though, with the city mandating employers to pay into a fund that would cover uninsured adults. The Golden Gate Restaurant Association fought the plan, claiming the mandated costs are higher than restaurant owners can afford.

If employer-provided health care is decreased or goes away completely, I think that there will be some unintended consequences for large companies in particular. Many people hold on to jobs they don't like at larger employers solely for the access they provide to quality health insurance. If other affordable, high-quality options become available, I think that these employees will leave their employers. Some will move to work in different fields, but others will move to competing companies, or start their own businesses to compete with their former employer.

According to the White House, small businesses are the engine of job creation in this economy, providing two out of every three new jobs, although the nonpartisan National Bureau of Economic Research questions these rosy statistics. Small businesses freed from the burden of taking on large health care costs once they reach a certain size, however, are likely to grow rapidly. As some larger businesses lose employees and smaller businesses gain them, will the revenue gap between the two types of businesses decrease? Will that change ultimately decrease the gap between rich and poor, and shore up the middle class again?