While not intending to do so, my fellow blogger, Joe Paduda has made a well-constructed argument for single payer health care, all the while examining the impact of health insurance status has on workers’ comp.
Rather than give you my take on what Joe wrote, I am providing the reader with his entire post below:
Health insurance status and workers’ comp
The headlines were comforting – not much change in the number of Americans without health insurance.
Before you breathe that sigh of relief, you’d be well-advised to dig a bit deeper, because there’s plenty of bad news just under the headline.
While the national number of uninsured stayed about the same, that’s irrelevant to you – because healthcare is local. Here’s what I’d be worried about.
Young adults are almost twice as likely as older adults to be uninsured – about one in six younger adults don’t have coverage.
- Takeaway – no health insurance = more incentive to file work comp claims
- Over a quarter of working-age Texans don’t have coverage. Georgia, Florida, and North Carolina are not far behind
Takeaway – no health insurance = poorer health status, more comorbidities, more charity care for providers thus more incentive to cost- and claim-shift.
- 44% of working-age adults were covered by high-deductible plans – but more than half of them don’t have health savings accounts needed to fund those high deductibles
Takeaway – “High” deductible health plans aren’t much different than no insurance at all if the patient can’t afford the deductible – and over half can’t. So, more incentive to cost- and claim-shift.
What does this mean for you?
Workers’ comp will be affected by the Administration’s ongoing behind-the-scene effort to hollow out the ACA and cut funding for Medicare and Medicaid.
But what it also means it that single payer will be the only way every American can be assured of access to health care that is affordable and available when they need it, and is not a luxury they can do without,
It may also mean that the workers’ comp silo may have to be folded once and for all into the health care silo that will cover the elderly, the poor, children, the military and their families, and everyone else not currently covered under any insurance, or under employer-sponsored insurance, which would be done away with.
So, Joe gave us an unintended gift by showing how health insurance status and workers’ comp may lead to the implementation of single payer health care.
A report issued Monday by Milliman indicated that the cost of health care for a typical American family covered by the average employer-sponsored preferred provider organization (PPO) plan in 2018 is $28,166, as per the Milliman Medical Index (MMI).
Broken down into component parts, this represents the following costs:
The key takeaway from the report is that employers are paying more; but employees are paying a lot more.
The health care expenditures are funded by employer contributions to health plans and by employees through their payroll deductions and out-of-pocket expenses incurred when care is received, according to the report.
The report continues that they are seeing over the long-term, and that employees are paying a higher percentage of the total, with employee expenses increasing 5.9%, and employer expenses increasing 3.5% in 2018.
The total cost of health care is shared by both the employer and employee for a family of four, the MMI stated, which breaks down to three categories:
1. Employer subsidy. Employers that sponsor health plans subsidize the cost of healthcare for their employees by allocating compensation dollars to pay a large share of the cost.2. Employee contribution. Employees who choose to participate in the employer’s health benefit plan typically also pay a substantial portion of costs, usually through payroll deduction.3. Employee out-of-pocket cost at time of service. When employees receive care, they also often pay for a portion of these services via health plan deductibles and/or point-of-service copays.
The relative proportions of medical costs for 2018 are:
Looking at this another way, employees are paying a total of 44% as either a contribution or out-of-pocket, which adds up to $12,378, compared to the employers’ 56% and $15,788, respectively.
As health care gets more expensive, it will naturally lead to higher costs for employers, but also higher costs for employees. And as has been happening more commonly, employers are shifting more of the costs onto the employees. With stagnant wages, as reported daily in the news, this is going to be a problem for those families caught in the squeeze between rising costs for medical care and stagnant wages.
This would be resolved by creating a single payer health care system that will save both employers and employees money,
Follow-up to the last post and yesterday’s regarding CMS’ initiative for quality reporting.
See the link:
The report also found physicians are moving more toward independent and physician-led group practices after a six-year trend of doctors moving to hospitals.
The proletarianization of physicians marches on. As you recall from my reviews of “Health Care under the Knife”, there has been a steady movement towards making physicians into employees of hospitals, or rather their proletarianization. Now it seems they are up against noncompetes, as the article below reports.
Here is the link to the article:
Legal experts say noncompete agreements are common practice for hospitals, and are usually enforceable. But physicians, and in some cases the courts, are pushing back.
As readers of this blog have noticed in the past, I have been very critical of CMS’ introduction of myriads of models, programs, and schemes to improve quality reporting and physician performance, so it is no surprise that I look upon this new initiative with a bit of skepticism. But I’ll let you the reader decide if this is just another wasted effort by CMS or if it has a chance to actually work this time. After all, after forty years of tinkering, the American health care system is no better off than it was before CMS got involved.
One of the quality networks CMS wants to roll into a single contract concerns something your humble writer is going through, ESRD.
Here’s the article:
Quality Improvement Networks and Organizations, End Stage Renal Disease Networks and Hospital Improvement Innovation Networks are all being bundled into a single $25 billion contract.
Physician shortage issue has resurfaced, this time with regard to primary care physicians’ salaries, as per the Healthcare Dive article below.
Compensation for non-physician providers grew 8% over the past five years, reflecting their increased role amid an aging population.
It’s May, and you know what that means. It means NCCI has held its Annual Issues Symposium, and the State of the Line Report, presented by Chief Actuary Kathy Antonello.
But this year I am going to do something a little different. I am going to compare the data presented this year with some of the data from last year and the year prior, so that the reader can see how much change there has been year over year from the 2017 and 2018 reports. Last year’s data and the year before was presented in my post, “Slight Increase in Average Medical Costs for Lost-Time Claims, Part 2.”
First up, this year’s WC Average Medical Lost-Time Claim Severity in Chart 1.
As you can see, there has been another slight increase in the lost-time claim severity from the 2016 to 2017 preliminary data. In 2016, the average medical lost-time claim severity was $28,800 and the preliminary 2017 severity was $29,900, an increase of nearly $1,000.
The key takeaway here is that NCCI estimates that the AY 2017 average medical lost-time claim severity is 4% higher than the corresponding AY 2016 value.
Looking back at the data from last year’s report, we can compare the preliminary 2016 data with the actual 2016 data reported above. Chart 2 exhibits last year’s data.
Source: NCCI’s Financial Call Data; p Preliminary based on data valued as of 12/31/2016.
In chart 2, the preliminary medical lost-time claim severity was $29,100 and represented a 5.0% change from 2015. In 2015, it was $27,700 and saw a -1.4% change from the prior year.
This is borne out in the next chart, Chart 3, where the 2015 average medical lost-time claim severity was estimated at $28,500, or a 1.0% change from 2014.
Next, we look at the cumulative change in medical lost-time claim severity (1997-2017p), as highlighted in chart 4.
In this chart, the cumulative change in medical lost-time claim severity is contrasted with the cumulative change in the Personal Health Care Chain-Weighted Price Index (1997-2017p). The PHC is a proxy for medical care price inflation that responds to changes in the blend of different medical services over time.
From the chart, the cumulative change in medical lost-time claim severity has strongly outpaced the change in the PHC index in that same period, indicating that while the PHC index is nearly flat, the medical lost-time claim severity is rising and will continue to do so.
According to NCCI, the medical lost-time claim costs have risen faster, +175% , than the PHC index of +61%, over the period from 1997-2017, with most of the gap occurring in the years before the recession.
However, looking at the data from last year’s report, as shown in chart 5, the cumulative change in medical lost-time claim severity was much higher, as estimated by NCCI, which was +227%.
Sources: NCCI’s Financial Call Data; Centers for Medicare & Medicaid Services ; p Preliminary based on data valued as of 12/31/2016.
The next chart, chart 6, compares the relative growth rates between medical severity and price inflation.
On the left-hand side, the medical lost-time claim severity grew approximately 4.5% per year faster than the medical care prices for the same period.
On the right-hand side however, the change in the medical lost-time claim severity and the medical care price tracked one another in the same ten-year period. Yet, there is a slight rise in the medical lost-time claim severity after 2015 continuing into 2017.
The key takeaways as NCCI reported were that much of the gap between the cumulative changes in medical lost-time claim severity and the PHC index since 1997 arose from the years prior to 2007. And that both the severity and care prices have grown at approximately the same rate, as indicated above.
Lastly, the next chart, chart 7, indicates the average annual change from 2012 to 2016 for all NCCI states. Note: all states in grey are either monopolistic states or are intrastate-rated states that do not report data to NCCI.
The state with the highest average annual change was Nevada, and the states with the lowest average annual change, were Maine, Massachusetts, North Carolina, Oregon, and Rhode Island.
The key takeaways here are that the average annual change in medical lost-time claim severity was +2.3% from the four years between 2012 and 2016. The increase in Nevada, NCCI stated, was due to a very large claim that occurred in 2016. The decrease in North Carolina was due to a combination of large claim activity in 2012 and a change in the medical fee schedule in 2013 and 2015.
But it is apparent that most states experienced a change at, or below 10% from 2012 to 2016. And if we are to believe that claim frequency is decreasing, then we must ask ourselves, why is the medical lost-time claim severity rising, as seen in chart 1, one hundred dollars short of $30,000.
One answer we have already examined is the cumulative change in medical lost-time claim severity from 1997 to 2017, although preliminary as of this week’s report.
However, what is not shown is what lies behind those numbers, i.e., what is happening in each claim to cause the severity to rise, or not rise. There is no indication, as there never is, as to what amount of the rise is due to the cost of surgery or to other claim factors such as hospital bills, ancillary services such as medical equipment, anesthesia services, any testing performed, etc. In short, we don’t know if what is causing health care costs generally to rise also is affecting the medical lost-time claim severity.
As I have stated before in this blog, workers’ compensation must look to other alternatives to help bring down the medical lost-time claim severity. This cannot be achieved by looking between all three coasts. It must include looking at less expensive, but equally advanced medical care elsewhere. Otherwise, the gap will only get wider over time.
In a rebuff to the current neo-liberal regime and its recent plan to tackle drug prices, the State of Vermont became the first in the nation to allow cross-border purchasing of drugs from Canada. Makes sense because the border is not that far away.
Years ago, my late mother worked for a company here in Florida that facilitated drugs to come to patients from Canada, the UK and Israel.
But thanks to successful lobbying by a former Democratic Congressman from Louisiana who after leaving Congress became a lobbyist for the pharmaceutical industry, the government forbade the importation of Canadian drugs.
The measure is one of the most aggressive attempts by a state to tackle rising drug prices that critics say are crippling state finances.
Last month, I wrote two articles about the book by Howard Waitzkin et al. entitled, “Health Care under the Knife: Moving Beyond Capitalism for Our Health.
The first article was a review of the Introduction to the book. The second article examined the Affordable Care Act (ACA), also known as “Obamacare”, as the last stage of neoliberal health care reform.
In this article, I will critique the overall message of the book and give some reasons as to why I believe radical change in American health care and radical change in American society in general cannot take place until one key condition is met for that change.
This will also apply to the rest of the world where neoliberal policies have taken root. But since much of the impetus of these policies comes from the US and institutions the US created after World War II such as the International Monetary Fund (IMF), the World Bank, and the United Nations’ World Health Organization (WHO), as well as many international financial institutions and the Gates Foundation, it will be difficult, but not impossible to turn back those policies and effect the necessary change to secure universal health care for their citizens. Some have already done so.
The authors have made a very convincing case for their argument that the failure to achieve universal health care is a result of neoliberal policies enacted over thirty years ago both here in the US and in the UK under both Republican and Democratic administrations, and under the various Conservative Party Prime Ministers, from Thatcher, Major, Cameron, and now Theresa May, and Labour PMs, Blair and Brown.
However, their prescription for how we overcome these policies assumes that social change is necessary before there can be change in health care. While technically correct, their understanding of the conditions necessary for that change is flawed.
Economic determinism, the socioeconomic theory that underpins much of Marxist thought about Capitalism and the relationship between workers and owners of the means of production is central to the thesis in “Health Care under the Knife.” But can economic determinism really explain why the central thesis of Marxism has not materialized, since Marx predicted that the contradictions inherent in Capitalism would bring about the revolution that would free the working class.
The truth is more complicated than that, because Capitalism has a nasty habit of reinventing itself, or in the case of the New Deal and the Great Society programs of the 20th century, reform the system to improve the lives of those most affected by the inequalities of the Capitalist system.
Many American families, mine included, benefitted from those reforms. Whether we are talking about Social Security, the GI Bill, student loans guaranteed by the federal government to cover the cost of college for those in the working and middle classes, job training programs, other forms aspects of the social safety net, millions of Americans have moved upward in social mobility.
Anecdotal evidence from friends and relatives, stories of celebrities rising from humble beginnings, and lately, the rise of a biracial male from the State of Hawaii, whose father was an African immigrant and whose mother was a White American, and reached the highest office of the nation, is indicative of this upward social mobility. He did it by working hard and proving that if he could do it, given his background and personal tragedy of losing his father early in his life, anyone can.
The long-predicted revolution, therefore did not happen because many working people, to use a euphemism, “made it”. Some have made it into the middle class, and some have made it into the upper middle class. And some others managed to make it into the lower strata of the upper class. They are not the proverbial “1%”, but nevertheless, they are wealthy. And happy, well-off people don’t make revolutions.
We are however, seeing a reversal among some of the middle class and working class, and that is most definitely due to neoliberalism. And the opioid crisis is decimating the White working class and economic dislocation is one reason for the increase in suicides among White males.
So, to base the argument for single payer solely based on economic determinism and the change the authors contend is necessary for that to occur, is only looking at one side.
After the ascendency of Ronald Reagan to the Presidency, I realized that there was something else besides his charm and ability to communicate effectively that made Americans vote for him overwhelmingly. But I was unable for many years to understand why beyond believing that they did not want to be poor, as many living in Socialist nations were.
However, in the evolution of my consciousness, I have discovered that a socioeconomic theory only tells part of the story. Some years ago, I learned of a biopsychosocial theory of development called Spiral Dynamics. I have written about it before in other posts.
Without going into detail, suffice it to say that Spiral Dynamics is the theory that explains how people think, either as individuals or as a collective. And the reason is it called Spiral Dynamics is because the adult human mind is an oscillating, dynamic spiral from lower order to higher orders of thinking.
Based on the research of Clare W. Graves, Don E. Beck and Christopher Cowan, patented their ideas into Spiral Dynamics. Spiral Dynamics is concerned with the life conditions and coping measures used to solve the problems life conditions present to individuals and collective societies. It also reveals the deep codes about how people think, and what they value.
Using Graves’ labels for the first six levels of existence, they borrowed the term “meme” from Richard Dawkins, the British biologist, and color coded them for better mnemonic effect, as shown in the table below. Beck and Cowan labeled their version of memes, vMemes, or value systems, as they are concerned with the values individuals and collectives manifest at any given time in their development. Individuals and collectives can exist at more than one level at any time.
The table illustrates the last three levels as they currently are represented in the American population, along with the percentage of the world population at each, and the percentage of social power they have. The US is included in these figures, and only at Green do we see what percentage of Americans are at Green. But we can use them nonetheless for our purposes here.
By adding the percentage of population at both Blue and Orange, which in today’s America represents the Republican Party’s bases’, we notice that Blue/Orange has 70% of the population. Conversely, adding the percentage of power for each gives us 80% of the power, meaning that 70% of the American population controls 80% of the social power. Given that fact, to effect any change, either in society in general, or in health care, those percentages must change.
Blue has throughout history viewed the delivery of health care as a form of charity. The word hospital comes from the Knights of the Hospital of St. John, who provided care for poor, sick, or injured pilgrims coming to the Holy Land. And more recently, several Christian denominations have established hospitals for the same purpose. Catholic, Baptist, Methodist, and Presbyterians are but a few of the Christian churches that have built hospitals in cities across the country. Jews also have built hospitals, even the one this writer was born in.
Orange, on the other hand, sees the delivery of health care as a commodity that can be purchased for a price through the instrument of an insurance policy issued by a for-profit insurance company. If one can pay for it, then health care is easily accessible, and available when needed. But if one is not able to do so, then they should have planned accordingly. It is not their responsibility to provide them with health care by using their hard-earned income for such care, is their reasoning.
Green, therefore believes that health care is a right, and that is how it should be. It should be no surprise that one of the areas where the Green meme is seen is in Canadian health care. Many progressives point to Canada’s system as a model for the US.
But what prevents the US from moving forward towards that model is exactly how both Blue/Orange sees health care delivery. And since Orange has most of the power between the two, it is Orange’s Capitalism and Neoliberal policies that dictate how health care is delivered, paid for, and who can get it.
Thus, the one flaw in the argument the authors of “Health Care under the Knife” have is not understanding the value systems that underpin opposition to universal health care. It is not enough to discuss the economic reasons, as they have so successfully done, but to examine the psychosocial aspects as well. Taken together, economic determinism and Spiral Dynamics, in my opinion, explains in greater detail why change cannot happen as the authors would wish, until most of the US population evolves up the spiral.
One of the outgrowths of Spiral Dynamics as theory has been its merger with economics which Said Dawlabani has termed, MEMEnomics. MEMEnomics has been defined as a new branch of social science that studies patterns of economic policies and practices by taking an integral, whole-systems approach to economic sustainability.
According to Dawlabani, the US has entered what he called the Third MEMEnomic Cycle and it is expressed as the “Only Money Matters” Meme. This period began in the 1980s, the same time when neoliberal policies began. It led to what Dawlabani called the perfect Memetic storm. It is at this juncture where we find ourselves, and it his belief that a new paradigm is needed to move into the next cycle.
So, despite polling favoring single payer health care, as the authors rightly note, powerful interests will block any movement towards single payer. Until Orange has diminished in its social power and Green’s has increased, nothing will change. And the radical change they prescribe for this to occur will not, so long as social mobility for some prevents it, and profit can be squeezed out of the system.
Nevertheless, I highly recommend this book as a significant resource for understanding the dysfunction of our broken health care system despite its one flaw of being only one part of the story.