Friday, October 15, 2010

Health Reform: Declaring and Winning Victories on the Way Forward

Invitation to a Discussion

Many are mad as hell this election season, including some progressives. Absent the funding of the madly rich and insanely right-wing Koch brothers, what are we to do?

For one thing, take a sober look at the policy and politics associated with the Affordable Care Act.

This is not the single payer system many staunch health care reform advocates - including me - preferred, but lacked the power to enact. As we continue the campaign for a single payer, it is essential to recognize, vigorously defend and advance the victories we achieved in the Affordable Care Act, in order to preserve the gains for people in need and also to shore up the valuable activists, and activism, we will need for what is going to be a long haul ahead.

Here's what the ACA accomplishes, what single payer systems do, why we're absolutely right to continue to advocate for them, and how we can shape policy to get there from here.

What does the ACA accomplish? The U.S. health care system will do a better job of treating illness and improving health at an affordable cost. The Medicare Trust Fund will be solvent for an additional 12 years, through 2029. There are substantial improvements for lower and middle income people, and immediate benefits for women, younger people, seniors and small businesses. Importantly, the ACA creates policy space to continue efforts to cover everyone while controlling costs, goals that are popular with the public. It accomplishes these objectives in part by imposing new progressive taxes and fees on the wealthiest 2% of the population and on employers.

Politically, the ACA opens opportunities to challenge corporate power at the national level, in the formation of extensive regulations. It throws some leverage to the states, which progressives can use to advance our goals of equitable, quality, universal, affordable health care.

The law includes compromises that call out for revision, particularly on affordability, and on coverage for immigrants and for reproductive health care. And the political process that got us here will be grist for analysis for decades to come.

But it is just not true, as some have characterized it, that the law is primarily a victory for business as usual by the insurance industry. Furthermore, the fight to undermine and defeat the law unquestionably empowers and invigorates the most predatory anti-government political and financial interests in the country. Since the facts don't serve their agenda - to profit by destabilizing our social and financial security, including dismantling Medicare - they rely on hyperbole and distortion to mobilize the public's complicity in opposing our own real best interests. In contrast, we can and must remain critical while carefully examining sweeping generalizations that don't fit.

Single Payer: Getting There from Here

Single payer systems funnel all payments for health care to one collection point - usually a state or national government. This single payer then pays all the health care providers: doctors, hospitals, drug companies. There is overwhelming evidence that single payer systems are more cost-efficient and affordable, along with their many benefits for equity and quality of care.

This is different from our current system in at least two ways that are key to controlling health care costs.

• First, it is administratively efficient. It eliminates the middleman: the proliferation of private insurance companies that take a bite out of every health care dollar for the administrative service of paying the bills. These insurance companies, both for-profit and non-profit, now rake off about 30% or more of our insurance premiums, using ploys that at the same time restrict access to necessary health care and inflict great suffering on ailing humanity. They also add to the administrative burdens of doctors and hospitals.

• Secondly, it moderates prices. It gives a powerful negotiator - the government - the authority to negotiate prices with the health care industry: hospitals, doctors, medical supply companies, drug companies.

Largely for these reasons, single payer proposals are fiercely attacked, maligned and misrepresented and in all manner just blocked in the halls of power by the industry, which profits nicely from this mess.

The state and federal governments are now writing the rules for implementing the Affordable Care Act. Advocates can help to shape these rules to get us closer to administrative efficiency, and to expand the public sector's purview over prices. Some examples:

• In 2014, new insurance Exchanges will standardize health insurance plans. People who buy insurance now as individuals or in small groups will be grouped into much larger pools, sharply reducing cost-shifting. Advocates have the opportunity to craft and support state laws implementing the exchanges that can push limits on standardizing health plans and require financial transparency.

• The law sharply expands the number of people covered by public sector health plans. For the first time Medicaid will cover everyone under 133% of the federal poverty level, regardless of health status. State governments already do negotiate drug prices under Medicaid, in which enrollment will grow by almost half by 2014. State laws to adopt a public option would further expand the number of people who receive health care either paid for or provided directly by the public sector.

• There are numerous opportunities to regulate, review and otherwise limit premiums, depending on the rules adopted by HHS, and state implementation laws. The current policy debate on how to define and enforce the Medical Loss Ratio is an important example.

• The law also draws on the public's control over Medicare to address some of the underlying drivers of increasing health costs through new measures such as comparative effectiveness research and payment reforms to encourage more cost-effective delivery systems. It also expands primary care and public health.

• Finally, as soon as 2017 - maybe sooner - there is a defined process for states to prepare for and enact alternative systems, including single payer.

The corporate media surround us with messages - and messengers - that exhort us to succumb to cynicism (nothing will ever work, they'll always sell us out). Voluntarily taking ourselves out of the real health care fights of the day is tantamount to capitulation. Effective strategies for building the power we need will require and emerge from engagement as well as resistance. Advocates can rebuild public awareness and momentum for single payer systems, and at the same time support legislation and regulations that maximize the progressive aspects of the ACA. If done well, our work on the ACA will build the pathways we need to a single payer system.

Monday, October 11, 2010

California’s Health Insurance Exchange Law: Why Does It Matter?

The Affordable Care Act (ACA) has created a new system of health insurance exchanges. States can design and implement the exchanges to offer new opportunities for access to affordable, accountable health insurance. California’s law is the first in the nation..

Under the federal ACA, exchanges will open in 2014 to offer standardized insurance plans to individuals and small businesses, with subsidies available to people earning up to 400% of the federal poverty level. The California law creates a 5- member governing body with two important features. First, it must “take into consideration the cultural, ethnic, and geographical diversity of the state so that the board’s composition reflects the communities of California.” Secondly, its strong conflict of interest provisions exclude participation by active agents of the insurance and health care industries.

In a key provision for affordability, the state will have the right to engage in “selective contracting” with insurance plans, meaning it will be able to negotiate on premium rates. In addition, it has the right to “require carriers to offer additional products within each of” the five levels of coverage specified by the ACA. These could conceivably refer to supplementary dental plans.

The exchanges for individuals and small employers are initially separate. They could be united in the future, pending a study due by 2018.

The exchange must be self-supporting, after repaying an initial loan for administrative start-up, although there is a prospect for General Fund support. Critics have noted that this funding limitation could hamper the exchange’s viability.

The law includes other important features. It requires coordination with existing health programs. The exchange must provide “oral interpretation services in any language for individuals seeking coverage through the Exchange and makes available a toll-free telephone number for the hearing and speech impaired.” And, “The board shall ensure that written information made available by the Exchange is presented in a plainly worded, easily understandable format and made available in prevalent languages.” Further, the Board must “consult with stakeholders relevant to carrying out” its activities, including “health care consumers who are enrolled in health plans, individuals and entities with experience in facilitating enrollment in health plans, representatives of small businesses and self-employed individuals, the State Medi-Cal Director, and advocates for enrolling hard-to-reach populations.”

Read the bills here:

California Exchange Bill AB 1602

CA Exchange Bill – Senate Bill 900 (Governance)