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Gender: Female
Hometown: Washington state
Home country: USA
Current location: Directly above the center of the earth
Member since: Sat Aug 16, 2003, 01:52 AM
Number of posts: 51,907

About Me

Major policy wonk interests: health care, Social Security/Medicare/Medicaid, election integrity

Journal Archives

How Liberals Tried to Kill the Dream of Single-Payer

Incrementalism only works if you have a vision and long-tern goals.


Let’s first admit the obvious: The political terrain for transformational health care reform is currently quite adverse. A single-payer bill would encounter colossal resistance from, for instance, the health insurance lobby, which is understandably in no great rush to be legislated off the face of the planet (nor does the pharmaceutical industry look forward to long-avoided price negotiations with the government). It’s also true that a Democratic sweep of both houses of Congress is unlikely in the coming election. And Democrats are, in any event, divided on the issue, as this primary election demonstrates.

To proceed, however, from an admission of these facts to an acceptance that the cause should be abandoned is to concede the contest before the first shot has been fired. This is something the Democratic Party has excelled at—with disastrous consequences—for decades. Conservatives, in contrast, have been far more willing to adopt ambitious, long-range political goals, even when contemporaneous political forces are arrayed against them.

As Daniel Stedman Jones describes in his Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics, the articulation of an initially unpopular, highly ambitious, anti-New Deal “neoliberal” program—outlined and promoted in the decades following World War II by economists like Friedrich Hayek and Milton Friedman and associated think tanks—took decades to “bear fruit.” But when political and economic circumstances changed in the 1970s, conservatives had an ambitious program ready to launch, and the right-wing revolutions of Ronald Reagan and Margaret Thatcher could begin in earnest.

The liberal retreat on single-payer is in line with a long history of centrist Democratic thinking that haplessly confuses rearguard action with political vision. Passing a federal single-payer bill would, no doubt, necessitate key electoral victories, a powerful campaign at the governmental level, and a formidable grassroots struggle. Useful initial steps in this direction might include the election of a president determined to pass single-payer, the restoration of single-payer to the platform of the Democratic Party, and vigorous support for such reform by pundits and scholars in high places. That none of these things may wind up happening is a cause of the alleged political “impossibility” of single-payer—not its result.


Second, proposals for “Medicare-for-all” usually call for the elimination of cost sharing, which is to say no copayments, deductibles, and co-insurance
. I’d argue that this is an essential aspect of real universal health care (with some notable exceptions, such payments are absent from the systems of Canada and the United Kingdom). The harms of such payments are all too real: As a result of out-of-pocket exposure, an analysis of survey findings published by the Commonwealth Fund last year put the number of underinsured Americans—the insured who lack sufficient coverage against the cost of medical care—at 31 million in 2014. Though discarding such out-of-pocket payments might sound like a pricey proposition, to the extent that these monies are already being spent, their elimination would be a wash, with no net effect on overall national health expenditures. But again, as is the case with the uninsured, insofar as some individuals and families are avoiding health care because of out-of-pocket payments, the elimination of these financial barriers would result in some real increases in health care utilization.

The “Cadillac Tax” on Health Benefits in the United States Will Hit the Middle Class Hardest


PNHP press release: http://www.pnhp.org/news/2016/march/‘cadillac-tax’-on-health-benefits-will-hit-middle-class-hardest-study

U.S. employment-based health benefits are exempt from income and payroll taxes, an exemption that provided tax subsidies of $326.2 billion in 2015. Both liberal and conservative economists have denounced these subsidies as “regressive” and lauded a provision of the Affordable Care Act — the Cadillac Tax — that would curtail them. The claim that the subsidies are regressive rests on estimates showing that the affluent receive the largest subsidies in absolute dollars. But this claim ignores the standard definition of regressivity, which is based on the share of income paid by the wealthy versus the poor, rather than on dollar amounts. In this study, we calculate the value of tax subsidies in 2009 as a share of income for each income quintile and for the wealthiest Americans. In absolute dollars, tax subsidies were highest for families between the 80th and 95th percentiles of family income and lowest for the poorest 20%. However, as shares of income, subsidies were largest for the middle and fourth income quintiles and smallest for the wealthiest 0.5% of Americans. We conclude that the tax subsidy to employment-based insurance is neither markedly regressive, nor progressive. The Cadillac Tax will disproportionately harm families with (2009) incomes between $38,550 and $100,000, while sparing the wealthy.

Comment by Don McCanne of PNHP: The “Cadillac tax” is an excise tax on premiums of more expensive employer-sponsored health plans. It was included in the Affordable Care Act partly as a revenue source to help pay for ACA, partly to offset the tax subsidies for employer-sponsored insurance that were more generous for higher income individuals, and partly to reduce the incentive to purchase more insurance than necessary under the theory that making patients more sensitive to health care costs will prevent spending on supposedly excessive health care services (certainly a contentious point).

Because of the high costs of health care, we do need funding mechanisms that result in a transfer to those less able to pay. The Cadillac tax is a problem because, instead of disproportionately assessing the very wealthy, it impacts primarily working families. Not only is the tax unfair, the health plans will likely have their benefits reduced in an effort to escape the taxes.

In a PNHP press release (link above), Steffie Woolhandler, one of the co-authors of the report, stated, “Taxpayers should be paying directly for health care through Medicare-for-All, not indirectly through tax subsidies to private insurance. However, removing the tax subsidies – as Obamacare will do – without setting Medicare-for-All in place is a step backwards. It’s shameful that economists have provided cover for this tax that will hit middle-class families and largely spare the wealthy.”

The Cadillac tax is just one more example of the flawed policy patches required simply because the architects of reform decided to build on our current dysfunctional, fragmented financing system instead of replacing it with a more efficient, effective and equitable single payer Medicare-for-all program. That doesn’t mean that we have to live with our highly flawed system. We can still change it.

My comment: Do you know what they call "Cadillac plans" in other developed countries? Just plain old "health care."

Medicaid and CHIP premiums decrease access to health care

Well, like, duuuhhhh!!


OBJECTIVE: Our objective was to review effects of premiums on children’s coverage and access.

RESULTS: Four studies examined population-level coverage effects by using national survey data, 11 studies examined trends in disenrollment and reenrollment by using administrative data, and 2 studies measured additional outcomes. No eligible studies evaluated health status effects. Increases in premiums were associated with increased disenrollment rates in 7 studies that permitted comparison. Larger premium increases and stringent enforcement tended to have larger effects on disenrollment. At a population level, premiums reduce public insurance enrollment and may increase the uninsured rate for lower-income children. Little is known about effects of premiums on spending or access to care, but 1 study reveals premiums are unlikely to yield substantial revenue.

CONCLUSIONS: Public insurance premiums often increase disenrollment from public insurance and may have unintended consequences on overall coverage for low-income childre

Comment by Don McCanne of PNHP
: Most individuals are relatively sensitive to the health insurance premiums they pay. This particular analysis of multiple studies shows that the rate of low-income children enrolling in the Medicaid or CHIP programs declines as the premium increases. Since an important objective is to try to ensure that all low-income children have insurance coverage, charging premiums for the government programs is an unwise policy as it results in the opposite outcome.

In fact, health insurance premiums are a deterrent to enrollment for all populations. A goal of health reform was to have everyone covered (though that was abandoned when it was acknowledged that the Affordable Care Act model could not accomplish this). Thus we still have 29 million people who remain uninsured without much of a prospect that we can significantly decrease the numbers simply because of the administrative complexity of the ACA model. Many of these 29 million people are disqualified for the public programs or cannot afford even subsidized premiums and thus will remain uninsured.

A single payer system is not funded through insurance premiums but rather is funded through equitable taxes based on the ability to pay. Taxes are automatic. An individual does not have the option of not paying them, unlike the option of declining to pay insurance premiums, thus forgoing coverage. True, some people fail to pay their taxes. Although that might cause problems with the IRS, it does not result in the revocation of the right to enjoy the fruits of government funded services. If we funded an improved Medicare for All program through the tax system, nobody would lose his or her coverage for non-payment. Health care coverage would always be there for everyone.

We should be supporting effective policies that would bring health care to all of us rather than being distracted by peripheral issues such as protecting the the interests of the inefficient private insurers. Switching from insurance premiums paid to private plans to equitable taxes to fund a more efficient public insurance program is exactly the type of public policy that we should be considering if we really do want everyone to have health care.

Cherry-picking Statistics to Bash Sanders’ Medicare-for-All Plan


In the heat of battling Sen. Bernie Sanders, Hillary Clinton's camp (and the camp followers at the Washington Post and Fortune magazine) has made a remarkable discovery: National health insurance (aka Medicare-for-All) hurts poor people.

How is that possible? It's not. But a widely-quoted analysis by Ken Thorpe, a former Clinton administration official, used statistical sleight of hand to zoom in on the tiny slice of the poor who might pay more (while getting better care), and hide the vast majority who would gain.

Here are the real numbers we came up with by analyzing data from the Census Bureau's 2015 Current Population Survey, the standard source for estimates of income and health insurance coverage.

At present 9.2 million people living in poverty -- and 8.8 million just above the poverty line -- are uninsured. They often can't get vital care, and when they do, they face ruinous medical bills. For these 18 million, Medicare-for-All would be a godsend.

Another 10.7 million poor Americans and 21.5 million near-poor have private insurance. For virtually all of them, the new Medicare-for-All taxes would cost less than their current premiums.

Some of this windfall would go directly to families that now pay all or part of their own premiums.

The rest would go to employers who now chip in to premiums for the poor and near-poor workers, but most economists believe these gains would be passed on to workers since benefit costs are, in fact, deducted from wages.

Comment by Don McCanne of PNHP: An Improved Medicare for All system would provide for everyone all necessary health care, and it would be funded with progressive taxes that are fair and affordable for each of us. Using one tentative set of tax policies as an example of how the system could be funded does not change this basic truth.

Selected numbers associated with Bernie Sanders’ loosely sketched out Medicare for All proposal have been used to attack the fundamental concept of single payer with no acknowledgement that eventual legislation would ferret out any numbers or assumptions that might be slightly off (though that's in dispute) and then carefully tune them to get the financing right.

One example, using the widely circulated set of numbers, indicates that some lower income individuals might end up paying more than they do now, though the extent and intensity of the deficits have been exaggerated, as the analysis by Steffie Woolhandler and David Himmelstein shows.

The point is that tax policies are quite malleable, with many potential sources and variable rates. They can be adjusted to ensure that taxes would be equitable for all.

Under the tentative Sanders numbers, about 1.2 million lower-income individuals might be slightly worse off financially, but at least they would be insured. Compare that to the 2.9 million adults who are in the ACA coverage gap who remain uninsured - a far worse problem than facing a modest financial imbalance. It would be far easier to adjust the taxes under a single payer system than it would be to fill in the coverage gap resulting from the complex administrative infrastructure created by ACA.

Those who continue to bash the Medicare for All concept based on tentative numbers and then conclude that we should stick with the Affordable Care Act are being disingenuous.

The Medicare for All model only needs fine tuning to meet the goal of health care for all, whereas merely patching the irreparably flawed ACA infrastructure will always leave us short of the goal. We need the right infrastructure, and then we can get them numbers right.

Health Care ‘Retailization’ Is Coming


Speaking at the Federation of American Hospitals annual meeting on Monday, CMS acting administrator Andy Slavitt invited providers to join the agency's ongoing push for the "retailization" of health care.

"A retail strategy calls on you to imagine you are negotiating directly with a cash paying consumer who used to be a source of bad debt — except one who now has the wherewithal to pay for services and wants to build a relationship where they can also find elective, outpatient and wellness services," Slavitt said. He went on to elaborate about the need for further price and billing transparency in health care — just like in other consumer markets.

Comment by Don McCanne of PNHP: Yesterday, at the annual meeting of the Federation of American Hospitals, Acting CMS Administrator Andy Slavitt asked the for-profit hospitals to join CMS’s ongoing push for the "retailization" of health care.

Retailization? Providers should imagine negotiating with cash paying consumers. They should strive for “further price and billing transparency in health care — just like in other consumer markets.”

Could there be a more explicit advocacy of consumer-driven health care - placing the patient-consumer in charge of health care spending? It fits with CMS’s efforts to privatize Medicare by over-paying the private Medicare Advantage plans, with overtures to convert Medicare to a premium support (voucher) market of private plans.

Politics? This is coming from an administration headed by a Democrat - a neoliberal administration that has been mislabeled as progressive - and supported by a presidential candidate who rejects Medicare for All and wants to build on Obamacare with its high deductible private health plans that place the patient-consumer in charge.

Retailization. Watch out, here it comes!

Economists decry political attacks, urge serious exploration of universal, publicly financed health

CONTACT:Ben PalmquistNational Economic and Social Rights Initiative
(212) 253-1710 ext. 304, ben (at) nesri.org

Friday, February 26 – Senator Bernie Sanders’ proposal for universal, publicly financed, single payer health care has prompted a raucous public debate among economists.

The debate rose to a crescendo last week when four former heads of the Council of Economic Advisors (CEA) and economist and New York Times columnist Paul Krugman lashed out at Sanders and economist Gerald Friedman (a Hillary Clinton supporter who conducted an independent analysis of Sanders’ health care plan) in what many are calling a dishonest political attack.

The four CEA chiefs criticized Friedman for making “extreme claims” based on “no credible economic research,” and Krugman followed suit with a stinging column calling Friedman’s work “horrifying,” “embarrassing,” and “voodoo.” Their criticism focused on skepticism of Friedman’s projection that universal health care and other public stimulus programs would induce the economy to grow significantly in the coming years.

As soon as the five economists lashed out, other economists rushed in to defend the integrity of Friedman’s work, calling out the five economists for what they saw as an attempt to smear Friedman and Sanders, and pointing out that they had done no rigorous economic analysis on which to base their claims. A number of economists are urging serious exploration of publicly financed universal health care, arguing that such a system would be more sensible, pragmatic and ethical that the current for-profit insurance system.

James Galbraith, a former Executive Director of the Joint Economic Committee, wrote an open letter to the CEA chiefs calling their accusations “not fair or honest.” Galbraith continues, “What the Friedman paper shows is that under conventional assumptions, the projected impact of Senator Sanders' proposals stems from their scale and ambition. When you dare to do big things, big results should be expected. The Sanders program is big, and when you run it through a standard model, you get a big result.”

Ron Baiman, an economist at Benedictine University, wrote on his blog that “the CEA’s appear to believe that their status entitles them to a blanket dismissal, without a shred of argument or analysis, of a standard economic analysis of a raft of economic proposals the scale and scope of which have not been seen since the New Deal.”

Dean Baker, co-director of the Center for Economic and Policy Research, says, “It is understandable that those opposed to Senator Sanders’ candidacy would want to belittle his health care proposal, but it would be more helpful in advancing health care policy if we could have a serious discussion of why the U.S. health care system costs twice as much per person as the average among other wealthy countries.

A number of economists have pointed to the high costs and inefficiencies inherent to the for-profit insurance system.

Katherine Moss, Economist and Visiting Faculty at Sarah Lawrence College, says, “It is well known that the U.S. health care system is fragmented, costly and inefficient. Single payer, publicly funded health care would expand access while reducing wasteful and excessive spending.”

Patrick Mason, an economist at Florida State University, says that for-profit employer-sponsored insurance “is an inefficient and costly approach to providing health insurance.” He points out that a publicly provided national health care program would be much more efficient that the current system both because it would considerably lower administrative costs and because by expanding health care access to everyone, it would create a healthier population with fewer costly illnesses.

Robert Chernomas, Professor of Economics at the University of Manitoba, says, “The US has by far the most expensive health care system in the world, the worst health indicators among wealthy industrialized nations and is the only industrialized nation without some form of truly universal health care. The overwhelming findings of the New England Journal of Medicine, the Journal of the American Medical Association, the Canadian Medical Association Journal and the Harvard School of Public Health is that private, for-profit health care is more costly, of lower quality, provides lower patient satisfaction and has a higher mortality rate than not-for profit health care.”

Chernomas asks, “Why spend $1.50 on inefficient private health insurance, ineffective and more costly for-profit hospitals and a poorly regulated pharmaceutical industry when for $1 or $1.10 you can get higher quality universally accessible health care paid from taxes and protected by democratically elected governments?”

Other economists argue that because health care is not only part of the economy, but also a fundamental human right, universal, publicly financed health care is both good economics and a moral issue.

Mark Paul, a PhD candidate in the Department of Economics at the University of Massachusetts Amherst says, “The current health care system is based off bad economics. Single payer health care in the United States can save billions of dollars. Not only are the economic numbers in favor of a single-payer system, but more importantly, it would save lives.”

Terrence McDonough, an economist at the National University of Ireland Galway, says, “Universal single payer health insurance is the only way forward for the United States health care system. Health care is a human right and should not be rationed according to ability to pay. For this reason universal coverage is the only ethical option.”

A number of economists contend that the reason there has been so much resistance to a policy that would both cost less and produce better health outcomes is that powerful health care companies have overwhelmed the political process.

Jose A. Tapia, an economist at Drexel University, says, “The only explanation of this absurd situation is the strength of the forces opposed to single payer national health care. Huge private and public costs of health care in the United States flow into enormous profits for those companies and individuals who benefit from the health care business.”

Paddy Quick, Professor of Economics at St. Francis College in Brooklyn, says, “The need for a fundamental restructuring of the health care system of the United States is clear. The opposition comes from the many insurance, pharmaceutical and other health-related corporations (as well as the many so-called ‘non-profit’ institutions) who profit from the current system. In this they are supported by those whose income enables them to purchase the ‘best that money can buy.’”

Yavuz Yasar, Associate Professor at the University of Denver, says, “What makes the single payer plan radical is the existing wasteful, outrageously expensive and inefficient U.S. health care system that helps health insurance firms, pharmaceutical companies and providers to increase their profits at the expense of ‘we the people.’”

Baiman too sees the current debate as more a political debate than an economic one. “No one assumes that Bernie’s economic program will be passed as currently conceived. The fate of these proposals depends on the power of the ‘political revolution’ that the Sander’s campaign is leading. … This is not a technocratic economic debate. It’s a political and ideological debate.”

Support for single payer depends on how you ask the question.



At first blush, many Americans like the idea of “Medicare for all,” the government-run health system that’s a rallying cry for Democratic presidential candidate Bernie Sanders.

But mention some of the trade-offs — from higher taxes to giving up employer coverage — and support starts to shrivel.

Comment by Don McCanne of PNHP: Most polls place support for a single payer Medicare-for-all national health program at about 60%, with some variation based on labels, framing, and polling technique. Yesterday’s Kaiser poll placed it at 50%. This new Associated Press GfK poll places it at about 40%, but it is unusual in that over one-fourth of those polled expressed no preference. Of those expressing a preference, 54% were supportive and 46% opposed. But there was something else that was also very unusual about this poll.

Yesterday’s Kaiser poll demonstrated that the views on single payer were malleable. When asked about negative features that allegedly are associated with single payer, support declined, whereas support increased when asked about positive features. In this AP-GfK poll they were asked only about allegedly negative features, and support declined. But what were these negative features?

* Your own taxes would increase - But no mention was made of the savings in premiums, out-of-pocket expenses and other taxes that would more than offset the new taxes, resulting in a net savings.

* Some people needed to switch doctors - But that is a characteristic of private plans with their narrow networks whereas single payer provides free choice of health care professionals.

* It took longer for new drugs and treatments to become available - There is no way that the pharmaceutical industry is going to walk away from a $3 trillion market.

* Longer wait times for nonemergency medical services - Responsible stewards would use capacity adjustment and queue management to prevent excessive queues, as has been done successfully in several other nations.

* People needed to give up other coverage like employer coverage - But they would be trading that for a superior program with more comprehensive coverage, reduced out-of-pocket costs and greater choices in health care.

* The new system would replace Medicare for seniors - Who would want to continue with the current Medicare program that pays for only about half of health care when you could have an improved Medicare with more generous benefits?

Why would the Associated Press conduct such a deceptive poll at a risk of impairing its credibility? When you read the AP release, you can’t help but come to the conclusion that it was designed to slam presidential candidate Sen. Bernie Sanders and his support of Medicare for all. They even included a gratuitous comment from an unemployed office manager to the effect that the single payer system is “subpar” like in “Europe and Canada” - an absolute falsehood.

Whatever the intentions of the Associated Press, we must make every effort to dispel the deceptions and disseminate the true facts about single payer Improved Medicare for All. The health of America is at stake.

Can Clinton get a public option into the ACA?


While Clinton's spokesperson told PULSE that she has consistently backed the public option since the 2008 campaign, Clinton pointed out just last month that Congress wasn't able to get it through during the ACA. "There was an opportunity to vote for what was called the public option," Clinton said during a debate in South Carolina, after she rebuked Sanders' plan as impractical. "But even when the Democrats were in charge of Congress, we couldn't get the votes for that."


Continue to support a “public option” — and work to build on the Affordable Care Act to make it possible. As she did in her 2008 campaign health plan, and consistently since then, Hillary supports a “public option” to reduce costs and broaden the choices of insurance coverage for every American. To make immediate progress toward that goal, Hillary will work with interested governors, using current flexibility under the Affordable Care Act, to empower states to establish a public option choice.

PNHP doesnt't like it, but I think it's still worth pursuing.


A quarter century of experience with public/private competition in the Medicare program demonstrates that the private plans will not allow a level playing field. Despite strict regulation, private insurers have successfully cherry picked healthier seniors, and have exploited regional health spending differences to their advantage. They have progressively undermined the public plan — which started as the single payer for seniors and has now become a funding mechanism for HMOs — and a place to dump the unprofitably ill. A public plan option does not lead toward single payer, but toward the segregation of patients, with profitable ones in private plans and unprofitable ones in the public plan.

Comment by Don McCanne of PNHP
: You remember the public option. During the drafting of the Affordable Care Act (ACA), efforts were made to include a public option - a government-run plan that would compete with the private health plans in the insurance marketplace. If the private plans proved that they could provide greater value, then they would prevail. If the government could do a better job, then the public option could expand by demand and eventually become the single payer for the nation, so supporters believed.

The original concept for the public option was to allow individuals to buy into the Medicare program instead of purchasing private insurance. There were some obvious problems. Medicare lacked some important features required of the private plans such as catastrophic coverage - establishing a maximum out-of-pocket responsibility of paying for health care. Also, the existing Medicare pool was composed of the elderly and those with long term disabilities - expensive groups to insure. The exorbitant premium that would have to be charged could not be competitive with the private plans.

It was then decided to establish a new public insurance program that was designed like the private plans and that would have to follow the same rules. The insurance industry immediately opposed this since it would be “unfair” competition considering the government resources backing up the public plan, and the inherently higher administrative costs that the private insurers face, not to mention the need to profit from their operations - profit not being a feature of a publicly-owned insurer. Several (anti-competitive) features were proposed for the public option which would give the private insurers a “fair” playing field.

The insurers were still concerned that they could not compete against even a restricted government plan, and thus they continued to oppose it. There is a basis for that concern since the private Medicare Advantage plans are able to “compete” with the traditional Medicare program only because of the overpayments that are being made to the private plans. If they were in the same playing field, the private plans would perish. Nevertheless, the issue of the private option became moot when Sen. Joseph Lieberman, with no votes to spare, threatened to kill the entire Affordable Care Act if the public option were included.

We were left with the co-ops as a substitute for the public option. The co-ops are non-profit organizations in which the insured members are the owners. Congress, under the Republicans, has refused to provide promised funds, and half of them have collapsed. They are now being used by opponents of single payer to “prove” that the government would be incapable of running a single payer system - an obvious non sequitur.

Since the enactment of ACA there have been endless calls to add a public option. Single payer failed to gain traction because of the pervasive meme that single payer was not politically feasible. But if we could just get a public option, that would automatically evolve into a single payer system, they said.

Then along came Bernie Sanders. He carried the message that not only was single payer politically feasible, it was a moral imperative to achieve health care justice for all. To the surprise of Hillary Clinton and her campaign staff, Bernie Sanders came out of nowhere and gained traction carrying the single payer banner, and, as a result, has become a genuine challenge to her candidacy.

Hillary Clinton has always been an opponent of single payer and instead has supported the private insurance industry. Some have misinterpreted a statement of hers many years ago as supporting the fact that we would have single payer in the United States. But that statement was not in support of single payer but rather was her threat to us that if we did not accept her managed competition model of reform, we would have single payer.

So what was her campaign to do? They decided to bring back the concept of a public option to appease those who were turning to Sanders because of his advocacy of single payer. They are relying on the meme that the public option is our door to single payer (even though it is not true). But look at what her version of the public option is.

She says we should build on ACA. She has proposed no new federal public option legislation but she is merely suggesting that the states look at Sec 1332 of ACA which authorizes waivers for limited innovations on a state level. Imagine the difficulties that states would have, within the confines of Sec 1332, in building their own intra-state public plan. Unless they used private insurance innovations such as high deductibles, narrow provider networks, and tiered services, the premiums would be unaffordable to most. A single payer system would be funded equitably through progressive taxes, but you could not do that with a public option since that is only one plan in a multi-payer system.

In 2009, David Himmelstein and Steffie Woolhandler explained in very brief terms why the public option is a flawed concept (reproduced above). Hillary Clinton is now showing us how it is a diversion from the reform we really need - single payer. It is up to us, the people, to convince our politicians that single payer is what we want. It will not happen without us.

Bad Debt Is the Pain Hospitals Can't Heal as Patients Don't Pay


Hospitals are feeling the pressure from those patients. Community Health Systems Inc. operates 195 hospitals in 29 states and is the U.S.’s second-biggest for-profit U.S. hospital chain. This month, it revised its fourth-quarter 2015 provision for bad debt up by $169 million -- and said that 40 percent, or about $68 million of that amount, was from patients being unable to pay deductibles and co-payments. Patient bankruptcies also contributed, the company said.

While higher out-of-pocket charges can lower what insurance costs up front, it means more costs for patients on the back end. Under individual Obamacare mid-level “silver” plans, the annual deductible was $2,556, and under less expensive, low-level “bronze” plans it was $5,328 in 2015, according to the Kaiser Family Foundation.

Outside of Obamacare, deductibles are becoming more common, as well. Last year, 81 percent of coverage people got through work came with a deductible, up from 70 percent in 2010, according to Kaiser. The average deductible in a high-deductible, individual plan gained through work was $2,099 last year.

Rural hospitals have been hit particularly hard. Minnesota has long had high rates of care coverage, and many employers have switched to high deductible offerings, according to Joe Schindler, vice president of finance for the Minnesota Hospital Association. Last year, bad debt rose by 20 percent to $425 million at the association’s 140 member hospitals.

Comment by Don McCanne of PNHP: The Affordable Care Act (ACA) was supposed to make health care affordable, yet many hospitals are finding that patients are generating more bad debt. A large portion of that is due to the inability of patients to pay the high deductibles and other cost sharing required by their insurance plans. Patient bankruptcies also compound the problem.

Deductibles are used by insurers to shift some of the spending to patients so that the insurers can keep the premiums for their plans competitive. But much has been written about how these deductibles create financial burdens for patients. And when the patients cannot pay the deductibles, physicians and hospitals are faced with bad debt. With greater use of higher deductibles, the problems with debt will surely increase.

This is a problem inherent in the model of reform perpetuated by ACA. Various policies such as the deductibles are developed to comply with the private insurance model. How would the incrementalists fix this problem? There are too many moving levers.

What we should have instead is a system in which the policies are developed to comply with the needs of patients. Deductibles can be eliminated if we do away with premiums as a means of financing health care.

The financing of a single payer system is not through individual premiums but rather is through a single universal risk pool that is funded equitably through progressive taxes, making health care affordable for everyone. Medical debt simply goes away.

Indiana Governor Pence seeking help from Congress in Medicaid dispute


For example, Indiana is testing whether requiring participants to make monthly contributions to a health account that can be rolled over if not used for health care reduces the use of unnecessary care.

That feature is based on high-deductible insurance plans with health savings accounts that are becoming increasingly common in private insurance coverage.

Pence argues that the Urban Institute, one of the evaluators chosen by the federal government to assess Indiana’s plan, has previously been skeptical of using the health savings account model for Medicaid recipients.

Pence wrote Health and Human Services Secretary Sylvia Burwell in December, asking that the federal review be dropped as the Healthy Indiana Plan has already been evaluated by a state-hired contractor.


The RWJF/Urban Institute report that Pence argues shows a bias against using healthy savings accounts in Medicaid:

Comment by Don McCanne of PNHP
: Gov. Mike Pence of Indiana wants to select his own facts for a report to CMS confirming that their consumer-directed health program for Medicaid, authorized by a Sec. 1115 waiver, is meeting Medicaid requirements for the patients.

They have already independently contracted with the Lewin Group to provide a report to CMS, but numerous organizations have expressed the concern that this report could be biased because of the conflict of interest. CMS has contracted with the Urban Institute, but Gov. Pence objects because Urban has produced a previous report expressing some concerns about the option to charge premiums for individuals living in poverty and about the administrative costs and inefficiencies of health savings accounts that are used in Indiana’s program. Also there is concern about Medicaid patients being locked out of care if they are in arrears with their premium payments.

Indiana’s program is driven by ideology rather than by objective application of health policy principles. Pence touts their success at “applying consumer-health care principles to the Medicaid population.” It is more important for him to require patients to demonstrate individual responsibility through sharing in the costs of care than it is to ensure that they do receive the care that they need. It has been demonstrated that requiring payments creates barriers to care, particularly for low-income individuals.

Imagine instead having one national standard program that automatically includes everyone, gives them free choice of their health care professionals, and removes financial barriers to care. We could have that with a single payer national health program, as long as we keep ideologues like Pence out of the way.
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