Universal health care in California: $17 billion a year, says one estimate

https://www.sfchronicle.com/business/article/The-price-tag-for-universal-health-care-in-13602501.php?utm_campaign=CMS+Sharing+Tools+%28Mobile%29&utm_source=m.facebook.com&utm_medium=referral&fbclid=IwAR1EEjMdhaai-HH9u6jq_Mo2aNNQ8cpAlmBD1J7Saxmb3c_rVag5HdVnrGc

Universal health care in California could cost $17.3 billion a year, under one plan proposed Friday by UC Berkeley health policy researchers.

The paper offers one path for getting about 3 million uninsured Californians health coverage. It is one of several recent estimates from researchers and legislators who have devised various ways to work toward universal coverage in the state. It is not a plan for a single-payer system.

The figure is significantly higher than other analyses, which found that working toward universal coverage by expanding Medi-Cal insurance for the poor would cost less than half of that. That is because the paper builds in the assumption that the uninsured would get on private health insurance plans, whereas other estimates factor in federal funding for getting more people on Medi-Cal, which is jointly paid for by the federal and state governments.

The paper, by Richard Scheffler and Stephen Shortell of Berkeley’s School of Public Health, proposes a mix of new taxes on the health care industry, California employers and airline travelers, paired with contributions from the state’s general fund and premium payments from individuals who are now uninsured.

The ideas, presented Friday to a group of California health policy researchers and advocates, are considered one early stab at financing universal coverage and are not included in legislative proposals.

The largest source of financing, 41 percent, would come from a 3 percent tax on the revenue of hospitals, nursing homes, drug companies, home care providers and insurance companies, which would generate an estimated $7.2 billion a year. The tax would not apply to public hospitals.

The next largest source of funding, 31 percent or $5.2 billion, would come from currently uninsured residents who would pay a monthly premium for a health plan — envisioned as a plan bought through the insurance marketplace Covered California. The premium would be paid by those who earn too much to qualify for Medi-Cal, the insurance program for the poor, and would average out to $123 a month per person. The authors do not specify how many people would pay this premium, or address how to incentivize this population — many of whom are undocumented and hesitant to participate in government programs — to buy into the system.

The paper also proposes a tax on international and business class travelers who fly into and out of California’s five largest airports: Los Angeles International Airport, San Francisco International Airport, San Diego International Airport, Oakland International Airport and San Jose International Airport. The taxes would be $50 per ticket for domestic business class passengers, $60 per ticket for for economy international passengers and $250 per ticket for international business passengers. These five airports see a collective 188 million passengers each year, according to the authors’ analysis of California Department of Transportation air passenger traffic data. The tax would generate $2.3 billion a year.

The remaining funding would come from the state’s general fund in the amount of $1.7 billion, and a tax on employers that would generate $979 million. The employer tax would be modeled after Healthy San Francisco, a program started in 2007 to cover the city’s 14,000 uninsured residents. It would require employers that don’t provide insurance to their workers to pay into a fund by levying a 4 percent surcharge on customers. It would apply to for-profit employers with more than 20 workers and nonprofit employers with more than 50 workers.

Under the plan, the revenue generated through these proposed new taxes would go toward what’s known as integrated care systems to expand their geographic reach and offer more insurance plans on Covered California. The biggest and most well-known integrated system is Kaiser, which provides both the insurance coverage and health care services to its patients, but others have started forming their own integrated care systems in recent years including Sutter Health’s HMO plan, Sharp Health Care in San Diego and HealthCare Partners in Los Angeles. Those integrated care plans would be offered on Covered California.

Scheffler and Shortell say they hope their ideas are a starting point for debate and will inspire action by state legislators.

“We’re hoping for some interest from Sacramento,” Scheffler said.

Some policy experts who reviewed the paper raised questions about some of the proposed taxes and the cost estimate. Ken Jacobs, chair of the UC Berkeley Labor Center, said $17 billion is much too high for achieving universal coverage because it doesn’t take into account the federal dollars that would be available if the state were to expand Medi-Cal to more uninsured people.

A state-level employer mandate could face legal challenges, as Healthy San Francisco did, because of federal preemption issues under the Employee Retirement Income Security Act, or ERISA, Jacobs said. Similarly, the airline tax might run afoul of federal laws regulating interstate commerce and airlines. And the tax on hospitals would need a two-thirds vote in the Legislature and buy-in from health care providers.

“I look at the (financing) as throwing some ideas on the table to start a discussion,” Jacobs said.

Other proposed measures and analyses put different cost estimates for getting California closer to universal coverage. A report released this month by Covered California found that providing more financial assistance to consumers to buy plans would cost between $2.1 billion and $2.7 billion a year.

One bill, AB-4, proposes expanding Medi-Cal to all undocumented adults — a move the Legislative Analyst’s Office has estimated would cost $3 billion annually. Another bill, AB-174, aims to provide financial assistance to those making between $48,000 and $72,000 to buy insurance. It would cost $40 million to $75 million a year, according to estimates included in a previous bill.

Gov. Gavin Newsom’s proposed budget included expanding Medi-Cal coverage to undocumented young adults between ages 19 and 25, and providing state-funded financial assistance to help Californians buy insurance — both of which would be steps toward universal coverage in the state. It is unclear how much the initiatives would cost.

 

Democrats Have No Safe Options On Health Care

Democrats Have No Safe Options On Health Care

Even though most of the candidates have committed to some form of universal health care, the Democratic primary is turning into a debate about the future of the country’s health care system. Presidential hopefuls have proposed policies ranging from an ambitious four-year plan to transform Medicare into a universal single-payer system, in which the government pays for everyone’s health care and private insurance plans are effectively eliminated, to a more modest scheme that would leave the existing health care system intact but create a government-administered public insurance plan people could choose to purchase. But some of the candidates have been light on policy specifics, so it’s likely that health care will be a big topic at the debates and beyond.

In the abstract, focusing on health care makes a lot of political sense for Democrats. It was a top issue among Democratic voters in the 2018 midterms, and the Trump administration recently renewed its efforts to strike down the Affordable Care Act in the courts, which means the law could be hanging in the balance throughout the primaries and into the general election. A recent ABC News/Washington Post poll also found that Americans, by a 17-point margin, say that President Trump’s handling of health care makes them more likely to oppose him than to support him in 2020. By a similar margin, an Associated Press/NORC poll found that Americans trust Democrats more than Republicans on health care.

All of this means that Democrats are heading into the 2020 election cycle with a serious edge on an issue that has the potential to mobilize their base. But if the candidates pitch big, sweeping changes to the health care system without addressing voters’ concerns about cost and access, that advantage won’t necessarily hold up. And trying to sell Americans on a completely new system carries risks, even in the primaries.

Why do people care about health care so much?

First, it’s important to understand how health care has morphed over the past decade from just another issue to one of the issues voters care most about. In the 2018 exit polls, 41 percent of voters said health care was the most important issue facing the country, up from 25 percent in 2014 and 18 percent in 2012. (It wasn’t asked about in 2016.) And although Democrats are more likely to prioritize health care than Republicans, a Pew Research Center poll from January found that a majority of Republicans say health care costs should be a top priority for Congress and the president.

The reason? Health care is becoming more of a financial burden, according to Mollyann Brodie, executive director for public opinion and survey research at the Kaiser Family Foundation. Specifically, Americans’ out-of-pocket health care costs have risen significantly over the past decade, even for workers who get insurance through their jobs. In an economy that by many measures is doing well, health care — rather than something like taxes — is becoming one of voters’ most important pocketbook issues, she said. “If you’re worried about whether you or your loved ones can afford your next health care bill, that’s really a matter of life or death, so you can understand why this issue is moving to center stage politically.”

And Americans are increasingly likely to say that the government has an important role to play in ensuring access to health care. In November, Gallup found that 57 percent of Americans said they think it’s the federal government’s responsibility to ensure that everyone has health care coverage, up from a low of 42 percent in 2013. Support for the Affordable Care Act rose over the same period, too. But, notably, support for government intervention in the health care system was even higher before President Obama was elected and the ACA passed — in 2006, 69 percent of Americans thought the government should guarantee health care coverage.

While support for government involvement in health care is rebounding, it’s not clear how much change voters are really asking for. “The average American is first and foremost concerned about the financial problems facing their family,” said Robert Blendon, a professor of health policy and political analysis at Harvard. “They’re less worried about system-level concerns like health care spending and inequality. They want their existing coverage to be better and more affordable.”

What do voters want politicians to do?

Americans aren’t opposed to the idea of government-run health care, but there’s not a lot of consensus on what that would mean. For example, a recent Kaiser Family Foundation poll found that a majority (56 percent) of Americans favor a national “Medicare for All” plan. But according to a March Morning Consult poll, Americans are more likely to favor a plan that offers some kind of public option — a government-sponsored health insurance plan available in addition to existing private plans — over a system where everyone is enrolled in the same plan.

But this apparent contradiction makes sense, according to Brodie, because Americans are risk-averse when it comes to health care, and the switch to single-payer would affect far more people than the ACA did. Tens of millions of previously uninsured people received coverage under the ACA, but that number would be dwarfed by the 156 million people who get their insurance through their employers and could see their coverage change if the country switched to a single-payer plan. “Even if the current system isn’t working, transitions are scary,” Brodie said. “And people aren’t necessarily aware of what a national plan really means. When you start telling people that there might not be any more private insurance companies, that’s actually not a popular position.” For example, a January Kaiser Family Foundation poll found that support for a national Medicare for All plan dropped significantly when respondents were told it would mean eliminating private insurance companies.

And when asked what health care policies they want Congress to prioritize, Americans don’t list Medicare for All first. Instead, according to a recent Kaiser Family Foundation poll, they want Congress to pass targeted measures that would lower prescription drug costs, continue the ACA’s protections for preexisting conditions and protect people from surprise medical bills. Only 31 percent of Americans say that implementing Medicare for All should be a top priority for Congress, compared to 68 percent who want lowering drug prices to be a top priority. Moreover, prioritizing Medicare for All is politically polarizing: Only 14 percent of Republicans support putting that kind of plan at the top of the to-do list, compared to 47 percent of Democrats.

Some health care issues get only one-sided support

Share of Republicans and Democrats who say each issue should be a top priority for Congress, and the difference between the parties

Dem. Rep. Diff.
Making sure the ACA’s preexisting condition protections continue 82% 47% D+35
Implementing a national Medicare for All plan 47 14 D+33
Expanding government financial help for those who buy their own insurance coverage on the ACA marketplace to include more people 36 18 D+18
Lowering prescription drug costs for as many Americans as possible 77 66 D+11
Protecting people from surprise high out-of-network medical bills 55 45 D+10
Repealing and replacing the ACA 16 52 R+36

Source: Kaiser Family Foundation

However, smaller policy steps like lowering prescription drug costs and protecting people from surprise medical bills get more bipartisan support. Overall, Americans seem to be more concerned with fixing the current health care system than creating a sweeping new replacement — even if that replacement could address the issues they most want fixed in the current system.

What does this mean for the Democrats?

The complexity of Americans’ views on health care doesn’t change the fact that Democrats have a big advantage over Republicans on this issue, but it does mean that the individual candidates are in a tough spot because there’s no obvious unifying message they can adopt for the primary. And embracing a single-payer plan now could hand the GOP a weapon for the general election, allowing Republicans to frame the health care discussion around the Democrats’ controversial plan while glossing over Trump’s efforts to dismantle the ACA.

“The safest bet for a Democrat in the general election is to emphasize Trump’s track record on health care and say you’re going to make the ACA work,” Blendon said. The problem is that while that kind of argument might appeal to moderates, it’s likely to fall flat among a significant sector of the Democratic base that supports prioritizing a national Medicare for All plan over improving and protecting the ACA.

Democrats arguably still have an opening to make a case for a more ambitious health care overhaul, since voters still have relatively little information about what something like Medicare for All means. “It’s fine to support single-payer if you think that’s where the country needs to go, but you can’t just lean on principles like fairness or equality when you’re selling it,” said David Cutler, an economist at Harvard who advised Obama’s campaign on health care strategy. “You also have to tell voters, very specifically, what you are going to do to lower their costs and improve their coverage next year — not in 10 years.”

Even though Americans mostly prefer Democrats’ health care positions to the GOP’s, Democrats still risk alienating voters if they emphasize bumper-sticker slogans over concrete strategies for reducing the financial burden of health care. This is particularly important because their base of support for a single-payer system may be shallower than it appears, even within the party — especially when it comes to getting rid of private insurance. Big changes to the status quo are always politically challenging, but they may be especially risky when many Americans are concerned about losing the protections they already have.

 

 

 

Dems tee up new document fight with DOJ over Obamacare

https://www.politico.com/story/2019/05/14/democrats-doj-obamacare-1318932

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House Democrats are mounting yet another confrontation with the Justice Department that could lead to subpoenas, but this time it’s not about special counsel Robert Mueller’s report — it’s about health care.

Five committee chairman foreshadowed a possible subpoena as soon as May 24 if Attorney General William Barr declines to provide documents related to his decision to stop defending the constitutionality of the Affordable Care Act — the health care law signed by President Barack Obama in 2010.

In letters to Barr and White House Counsel Pat Cipollone, the chairmen say they’ve been asking since April 8 for documents connected to the decision, as well as testimony from four key officials involved in the effort. The request, they said, sought a response by April 22 but that the reply fell short. Now, they’ve giving the Justice Department two more weeks to meet the committees’ demands. They’re also asking the White House to make budget director Russ Vought available for an interview.

“If we do not receive a response by this date, we will have no choice but to consider alternative means of obtaining compliance,” the lawmakers wrote.

The letters are signed by Oversight Chairman Elijah Cummings (D-Md.) , Energy and Commerce Chairman Frank Pallone, Jr. (D-N.J.), Ways and Means Chairman Richard Neal (D-Mass.), Education and Labor Chairman Bobby Scott (D-Va.) and Judiciary Chairman Jerry Nadler (D-N.Y.).

Nadler’s committee has already voted to hold Barr in contempt for refusing to provide an unredacted version of Mueller’s report to Congress as well as Mueller’s underlying evidence. But the full House has yet to consider the committee’s effort. Speaker Nancy Pelosi indicated last week that other committees may want to combine similar contempt proceedings into one overarching floor vote that could come in the next few weeks.

Democrats are also locked in confrontations with the Trump administration over accessing Trump’s tax returns — a request made by Neal’s Ways and Means Committee. The House Intelligence Committee has demanded access to Mueller’s report as well on national security grounds and issued a subpoena for his files last week.

The new effort on health care could become part of the broader strategy, if they continue to accuse the Justice Department of stonewalling by the time the new deadline arrives on May 24. But convincing other lawmakers to wait until June — following a weeklong Memorial Day recess — for a comprehensive contempt vote could be difficult. Rank-and-file Democrats have been clamoring for punitive measures against Barr for weeks for his handling of Mueller’s report.

Unlike the other demands, though, Democratic leaders, though, believe that picking a fight on health care is better politics — and it shows their efforts to confront the Trump administration has policy dimensions, not just Trump-focused investigations.

Democrats have attributed the Trump administration’s efforts to overturn the health care law, known familiarly as Obamacare, to “politically motivated forces” in the White House. The Obama White House took a similar step in 2011 when the Justice Department, at Obama’s urging, stopped defending the Defense of Marriage Act, which barred federal recognition of same-sex marriages — a move social conservatives denounced at the time.

The Department of Justice declined to comment.

 

 

 

Doctors bring in a lot of money for hospitals

https://www.axios.com/newsletters/axios-vitals-f3febfe2-1e33-46ad-993e-dc47d3fa3638.html

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Doctors are generating a lot of revenue for hospitals — much more than those doctors receive in salary, according to a recent survey by physician staffing firm Merritt Hawkins.

Why it matters: It’s easy to see why hospitals view acquiring physician practices as a lucrative opportunity — which hospitals are doing at a rapid pace.

  • “This is [a] good reminder that doctors are the gateway to the rest of the health care system. It’s doctors that make the decisions about whether people get admitted to the hospital, or get a lab test, scan, or prescription,” the Kaiser Family Foundation’s Larry Levitt said.

Go deeper: A recent survey by the American Medical Association found that for the first time ever, the U.S. has more physicians who work as employees than those who run their own practice.

https://www.merritthawkins.com/uploadedFiles/MerrittHawkins_RevenueSurvey_2019.pdf

https://www.axios.com/doctors-hospital-employees-independent-practices-7f91e1b6-aab3-452b-8204-98e0884c359c.html

 

 

 

 

 

Healthcare Triage News: Infants and the Medicaid Expansion

Healthcare Triage News: Infants and the Medicaid Expansion

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What can we do about infant mortality and disparities in health care? This week we take a look at a recent study in JAMA that may have an answer.

 

 

Uninsurance of children, parents inched back up in 2017, report finds

https://www.healthcaredive.com/news/uninsurance-of-children-parents-inched-back-up-in-2017-report-finds/554590/

Dive Brief:

  • After improving for several years, insurance gains and participation in Medicaid and the Children’s Health Insurance Program tilted downward in 2017, a new Urban Institute report shows.
  • In the first three years following implementation of the Affordable Care Act, the uninsurance rate dropped from 7% to 4.3% among children and from 17.6% to 11% among parents, or about 40% for both groups. In 2017, however, the children’s uninsurance rate inched back up to 4.6%, or an additional 281,000 uninsured children, and parents’ coverage rate stalled.
  • Uninsurance rates rose both in states with and without the ACA’s Medicaid expansion, but the increase was more pronounced in states without expansion programs.

Dive Insight:

The findings jibe with recent data from the Centers for Disease Control’s National Health Interview Survey, which showed more than 1.1 million Americans lost health coverage in 2018, pushing the total number of uninsured from 29.3 million in 2017 to 30.4 million last year. Among surveyed adults between 18 and 64 years old, 13.3% were uninsured, 19.4% had public health coverage and 68.9% had private coverage.

The trend coincides with Trump administration efforts to weaken the ACA by eliminating several mechanisms meant to stabilize payers participating in ACA exchanges and pushing stripped-down, noncompliant health plans. The result has been rising premiums and a resurgence in the number of uninsured.

Adding to uncertainty about the ACA’s future is the U.S. Department of Justice’s support for a Texas federal district court that ruled the law unconstitutional without its individual mandate penalty, which a Republican-led Congress removed in 2017. A previous Urban Institute report estimated up to 20 million Americans would lose health insurance if the lawsuit prevails — a majority of whom are currently covered through Medicaid expansions and ACA exchanges.

While the ACA remains in legal jeopardy, Democrats and presidential candidates are looking at ways to increase the numbers of insured Americans, from shoring up the ACA to implementing some type of single-payer system or “Medicaid for All.”

According to the Urban Institute, participation in Medicaid/CHIP among children increased from 88.7% in 2013 to 93.7% in 2016, and from 67.6% to 79.9% for parents. Those gains reversed in 2017, however, with Medicaid/CHIP participation dropping to 93.1% among children and remaining unchanged for parents.

Among those who did not enroll in Medicaid/CHIP in 2017, 2 million children and 1.7 million parents were eligible for the programs — versus 1.9 million and a steady 1.7 million, respectively, in 2016.

More than half of the uninsured children and parents who were eligible for the Medicaid/CHIP lived in California, Florida, Georgia, Illinois, Indiana, New York, Pennsylvania and Texas, according to combined 2016-2017 data.

Parents were more than twice as likely to be uninsured as children in 2017. For example, children’s uninsurance rate was less than 5% in most states and under 10% in nearly every state, while parents’ uninsurance was less than 5% in just four states and over 10% in close to half the states, the report says.

The decline in improvement was worse among certain subgroups. “In 2017, the uninsurance rate was nearly 6% or higher among adolescents, Hispanic and American Indian/Alaska Native children, citizen children with noncitizen parents, and noncitizen children,” according to the report. “And consistent with prior years, one in six parents or more who were ages 19 5o 24, Hispanic or American Indian/Alaska Native, below 100 percent of FPL [federal poverty level], receiving SNAP [Supplemental Nutrition Assistance Program] benefits, or noncitizen were uninsured in 2017.”

 

 

 

 

 

 

Number of uninsured adults reaches post-ACA high

https://www.healthcaredive.com/news/number-of-uninsured-adults-reaches-post-aca-high/546653/

Dive Brief:

  • The uninsured rate in the U.S. is at a four-year high, having reached 13.7% in the fourth quarter of 2018, according to a new Gallup poll. That rate is the highest since the Affordable Care Act’s individual mandate was implemented in 2014. 
  • Despite the rise in the uninsured rate, it’s still below the peak of 18%, recorded in the third quarter of 2013. That figure then dropped to an all-time low of 10.9% in 2016. The elimination of the individual mandate penalty, cost-sharing reductions and other policy decisions made under the Trump administration have helped boost the rate back up. 
  • According to Gallup, the uninsured rate has increased most among women, young adults and low-income Americans. Separate research has shown the number of uninsured children in the U.S. has also increased for the first time in over a decade.  

While employees are one of the largest costs for most hospitals, they’re also critical to the success of health systems. Our Trendline covers everything you need to know about labor in the healthcare industry

Dive Insight:

The Affordable Care Act helped the U.S. reach historical lows for the rate of uninsured adults, but that figure has continued to tick back up as the Trump administration has undermined the law.

In all, the 2.8 percentage point increase since 2016’s low point represents about 7 million more uninsured Americans. Most of those 7 million became uninsured in 2017, which experienced the largest single-year increase (1.3 percentage points) since Gallup began polling Americans on the question in 2008.

The continued rise in the uninsured rate is reversing the gains made under the Affordable Care Act.

The ACA ushered in a time when people could buy insurance not tied to a job — without having to worry about being denied for having a pre-existing condition such as diabetes or cancer. Plus, it allowed states to expand Medicaid to low-income residents who otherwise could not afford to purchase private coverage on their own.

During that time of record-low uninsured rates, many Americans were required to have health insurance or risked incurring a financial penalty.

But once President Donald Trump was elected he began working to overturn the law. In December 2017, the GOP’s tax bill eliminated the financial penalty for not having insurance. 

A separate Commonwealth Fund report found that the uninsured rate was up significantly among working adults in states that did not expand Medicaid.