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Newsletter, 'What's Going On...", October 2, 2010

October 2, 2010     (early this week to work around being out of town)

Dr. Aaron Carroll has had an intelligent series of articles on “What makes the US health care system so expensive” at The Incidental Economist.  From his last two paragraphs: “But there are a few things we all have to own up to.  The first is that most of the “extra” spending is in areas of care.  So, please, let’s stop pretending that cost containment can be painless or unnoticed. The second is that, to make cost reform feasible, we will need to have all sectors share in the pain.  That won’t be popular, but at least it might be fair.  Moreover, it will increase the chances of success.  The final thing is that we have to stop looking for others to blame.  We are all to blame.  So let’s get past blame entirely, and start dealing with the problem.   From Mother Jones/Kevin Drum

You will have read that the average total medical cost for a family of four is about $18,000.  The median family income in this country is a bit over $50,000.  Those numbers don’t compute, do they?  Don McCanne has a careful analysis of the numbers, and they really do compute.  They really do.  This is worth reading. 

The average total health care premium per employee for large companies will be $9,821 in 2011, up from $9,028 in 2010. The amount employees will be asked to contribute toward this cost is $2,209, or 22.5 percent of the total health care premium. This is up 12.4 percent from 2010, when employees contributed $1,966, or 21.8 percent of the total health care premium. Average employee out-of-pocket costs, such as copayments, coinsurance and deductibles, are expected to be $2,177 in 2011—a 12.5 percent increase from 2010 ($1,934). These projections mean that in a decade, total health care premiums will have more than doubled, from $4,083 in 2001 to $9,821 in 2011. Employees' share of medical costs—including employee contributions and out-of-pocket costs—will have more than tripled, from $1,229 in 2001 to $4,386 in 2011.  From Hewitt Associates. The Milliman Medical Index indicates that “the total 2010 medical cost for a typical American family of four is $18,074.”  The figure is an estimate of the “total annual medical spending for a typical American family of four covered by an employer-sponsored preferred provider organization (PPO) program” but does not include the “non-medical administrative component of health plan premiums.”  Both reports cited in an earlier Quote of the Day from Don McCanne.

The Hill reports an independent study indicating that only about 1-2% of the projected average 8.8% premium increase this year is attributable to the Affordable Care Act. 

Last week, without thinking enough about it, I passed along a piece from Politico: FIRST IN PULSE: EXCHANGES A PATH TO SINGLE-PAYER?   Senator John Cornyn had asked the Congressional Research Service what would happen if a state denied certification to every private insurance company that wanted into that state’s insurance exchange.  Politico PULSE assumed that if that happened, the state would force the market into a single payer system. WRONG.  It’s not clear what the outcome would be, but whatever it was wouldn’t be a single payer system unless the state had done some very major work to create that kind of a system.  Thanks, Pippa. 

Ezra Klein. “The states that are resisting the new health-care law are getting a lot of press lately. But on some level, that's a sideshow. The more consequential story is what's happening in the states that are implementing the new law. And here, as is often the case, California is leading the way:”   

Speaking of which, the Health Access WeBlog has a list of measures that passed the California legislature, a scorecard on their fate in attracting the Governor’s signature or veto, and comment on the legislation establishing an insurance exchange, legislation mandating affordable coverage for all children, and on disappointing vetoes+ of legislation that would have protected against junk insurance and that would have phased in maternity care as part of the state’s basic benefit package. 

The Importance Of California’s New Health Exchanges.  Igor Volsky, the Wonk Room

McDonald’s: This week’s health care non-story.   The brief excitement over McDonald’s mini-med insurance for its employees has highlighted an HHS statement on mini-meds and their place in Medical Loss Ratio calculations.  From Health Reform GPS.  Ann Molison passed along a Kaiser Health News comment on the controversy.

Rand Paul on Medicare.  Yes, he really does favor increasing the annual deductible under Medicare to $2000.

Sebelius: Secretive Campaign Spending Distorting Health Care Reform Is 'Alarming’.  From TPMDC

Igor Volsky considers the political gains and losses were the Republicans to defund parts of the Affordable Care Act. 

“As Democrats and Republicans gird themselves for a fight over President Obama’s health care law, the leading health care reform coalition in the country is locked in a brawl with the 60-Plus Association — a corporate-backed organization posing as a senior citizen’s advocacy group.”  The Wonkline.  The coalition supporting the health care reform includes Health Care for America-Now (not to be confused with Healthcare-NOW) and MoveOn.org ,  “The 60-Plus Association bills itself as a conservative alternative to AARP, but has virtually no income from member dues. (It is running TV) ads whose most prominent argument is that the health care law will "cut" Medicare by $500 billion.”

Paul Bedard of U.S. News and World Report previews Former Senate Majority Leader Tom Daschle’s new book, Getting It Done: How Obama and Congress Finally Broke the Stalemate to Make Way for Health Care Reform. “The book is due out October 12th, and if this excerpt about 10 Healthcare Reform Pitfalls is any indication, we’re in for a good dose of honesty about the future politics of reform”:  Igor Volsky, The Wonk Room.

Malpractice, tort reform and defensive medicine get a good going-over in Health Affairs this month.  Wright on Health has a summary of the issue.  (the issue of the Journal, that is, not the issue of malpractice.)

Will College Health Plans Be Exempted From Health-Care Overhaul Law?  The plans are notorious, but there may be a wrinkle that allows them exemption from the new health care reform law.  Wall Street Journal blog

POLITICO Pulse:  IN DENIAL - The new version of HealthCare.gov went live early this a.m. (Friday), fleshed out with pricing information and percent of people who pay more than the base premium. But insurers are griping over one particular number: the denial rate. "It includes a variety of things that are not a denial," says AHIP's Robert Zirkelbach. "If a person applies for a policy, but the health plan finds a better one that's more affordable, that's a denial. If somebody applies for coverage, but doesn't live in that state, it's a denial. It's misleading." The site www.healthcare.gov.   I gave the new site a test run this morning, wound up with 90 plans to choose from.  jwr

When Republican House leaders recently unveiled their "Pledge To America," they revived an idea long popular with conservatives: legislation that would allow consumers to buy health insurance across state lines so that residents of a state with expensive health plans could find cheaper options elsewhere.  When they were writing the new health law, Democrats said they heard the GOP and they included a way to sell insurance across state boundaries. They put in language allowing states to establish "health care choice compacts." But Republicans say that the compacts won't bring the same benefits.  Consumer advocacy groups are part of the political back-and-forth, arguing that such provisions would erode many state protections, leave policyholders with inadequate coverage and could actually lead to higher premiums for some people.  From the Kaiser Daily Health Policy Report

Doc Shortage to Worsen After Healthcare Reform. A new estimate from the Association of American Medical Colleges (AAMC) pegs the projected physician shortage at 50% worse than it would have been if healthcare reform hadn’t passed.  From KevinMD.

A new report from the Kaiser Family Foundation shows the extent to which the job and benefits loss of the recession has pushed individuals onto Medicaid, the government program to help the poor access health care. One in six Americans was using the program by the end of 2009.  Washington Independent.

A new brief prepared by the Public Consulting Group for State Coverage Initiatives, a national program of the Robert Wood Johnson Foundation, looks at the issues states will face as they consider whether to create health insurance exchanges, and if so, how to structure them. The Henry J Kaiser Health Reform Source.

The community pharmacist lobby is blasting Wal-Mart's latest Medicare prescription drug offering, saying the superstore's joint venture with Humana will penalize seniors who want to buy their drugs from local pharmacies. "On Friday, Walmart and Humana announced that they'd joined forces to offer seniors a new Part D plan in 2011. The Humana Walmart-Preferred Rx Plan boasts a national monthly rate of $14.80 per month, but co-payments will vary depending on where seniors purchase their drugs. In-store generic co-pays will start as low as $2 in "preferred" pharmacies, including Walmart and Sam's Club, the company said Friday, but rates will be higher in other shops.  The Hill’s Healthwatch.

A MATTER OF PRINCIPAL – New York Times: “The Principal Financial Group announced on Thursday that it planned to stop selling health insurance, another sign of upheaval emerging among insurers as the new federal health law starts to take effect. The company, based in Iowa, provides coverage to about 840,000 people who receive their insurance through an employer.”  DON’T BELIEVE EVERYTHING YOU READ - Principal was about to exit the medical market regardless of reform, Iowa’s insurance commissioner Susan Voss told PULSE late Thursday night. “There’s no correlation between health reform and Principal,” Voss says. “They have been slowly decreasing the medical percentage of their revenue base for 10 years now, from something like 30 percent down to 3 percent. We knew a decade ago they were focusing on a different market

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Sunday, October 3,  7PM CDT.  Healthcare-NOW monthly activist phone call. Please use this Dial-in Number 1-218-862-1300 and Conference Code 441086. To mute and unmute the line, please hit *4.

Monday, October 4. 2010  @ 5:30 PM.  North Alabama Healthcare for All Monthly Meeting —Huntsville/Madison County Public Library, 901 Monroe Street  (downtown).  The meeting is in Room AB, on the first floor. After you enter the library’s front door, turn right towards the auditorium.

Thursday, October 28, 8 PM CDT.  PNHP’s monthly activist phone call.  Please call me for the phone number and access code. 

Please join PNHP in Denver for our Annual Meeting on Saturday, November 6, at the Sheraton Denver Downtown Hotel. The Annual Meeting is PNHP's most important, energizing and inspiring gathering of the year. This year's theme is "From PPACA to Single Payer: Next Steps for Single-Payer Activists in the Wake of the Obama Health Plan." Speakers will include Amy Goodman, PNHP co-founders Drs. David Himmelstein and Steffie Woolhandler, and more. A limited number of travel scholarships are available for medical students.

Are you ready for Leadership Training? New PNHP members - and longtime members who want to take the next step and get active - are invited to come to Denver the day before the Annual Meeting to participate in PNHP's popular crash course in health policy and politics starting on Friday, November 5, at 1:00 p.m. We look forward to working with you! Contact Matt Petty at matt@pnhp.org or 312-782-6006 to register.

Healthcare-NOW National Strategy Conference.  When: Saturday, November 13th and Sunday, November 14th
Where: William Way Community Center, 1315 Spruce St., Philadelphia, PA Time: Sat, 4pm to 9pm; 
Sun, 8am to 4pm
 Fee: $30 for Healthcare-NOW! Members and $50 for Healthcare-NOW! Non- Members  Go to our National Strategy Conference page to register and more information.

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