4 policy ideas to improve health care BEFORE single payer

Sepatuads.com   Agustus 21, 2017   Affordable Care Act, Contraception, FEHB, high risk pool, Katherine Swarz, Maternity, Pediatrics, Single Payer, Trump Administration   Comment  

Today's Managing Health Care Costs Number is 4

I get angry when politicians and candidates pledge to implement "single payer health care," but are mum about what they would do right now to improve the health care system and enable a future transition to single payer when the political system is ripe for such a move.  

Here are four suggestions for efforts that "single payer" advocates should promote right now. All are consistent with continuing the employer sponsored health insurance system that we now have. That's important because

employers pay about 20% of total costs ($720 billion a year), and it will take some time to replace that contribution!  All of these ideas could garner some degree of bipartisan support, and all could be implemented at (relatively) low cost and with dedicated revenue streams.   All would also be opposed by someone - since there are a lot of parties within the medical care industry who are doing quite well under the current expensive, fragmented, and low quality system. 

All of these ideas would be better promoted federally than by state, as the federal government is better able to spend dollars during economic downturns, and since the need for these solutions is often highest in those states least likely to act progressively themselves. Progressive states can lead the way, though, and these incremental approaches are more likely to be financially sustainable than full-blown immediate state implementation of single payer, as shown by unsuccessful single payer efforts in Vermont and California.

1. Provide national (or state) coverage for high cost insurance beneficiaries.  
   
   Remove high cost members from the fragmented insurance system when they hit a set point (such as $100,000) -and provide insurance coverage for these members through a pool funded by a levy on all insurance plans. This can be modeled on the reinsurance arrangement that was in the Affordable Care Act, and would need to include levies on self-insured insurance plans.  This would be easier to do through federal legislation and regulation; states are poorly positioned to intervene in ERISA-regulated self-insured plans. Nationalizing coverage for the highest cost beneficiaries would lower the desire for insurers or employers to seek to "dump" high risk members/employees, and it would mean that those with such severe illness would no longer face financial ruin. It could be administered by CMS, which already administers such a program for those with end stage renal disease.  

Katherine Swarz of the Harvard TH Chan School of Public Health has written extensively about this for two decades.

This won't be easy. Reinsurers, providers who care for the super-sick, and pharmaceutical companies could feel threatened by this. High cost individuals will need to be disenrolled when they are no longer high cost. But this will make the current market stronger by eliminating some gaming incentives, and could serve as a way to gradually increase the portion of the medical budget that is financed through a single payer.

2. Provide access to the Federal Employee Health Benefits program in counties without at least 2 Affordable Care Act plans
   
   Competition is good!  The FEHB already insures 8 million beneficiaries in all 50 states.  The FEHB is managed competition - and some single payer advocates will object that this undermines the single payer cause.   Au contraire!  FEHB is a single payer with multiple health plans arranging the care - and there are many developed countries that have a single payer which "subs out" the care arrangement to dozens (or hundreds) of independent health plans.  The exchange market simply isn't robust in rural areas and areas with provider concentration - let's be sure that rural Americans have access to choice just like those of us who live in the cities.
   
   Health plans might object - and FEHB administrators won't be happy with a new mandate that probably comes without adequate resources.  But this is more business for the health plans that participate in FEHB - and a great model for eventual single payer.
   
    
3. Provide universal coverage for maternity care
   
   Having a baby is expensive - and the quality of maternity care in the US is horrendous and we are the only developed country with increasing maternal mortality.  Young families have relatively lower income than a generation ago, and are often burdened by student loans and huge housing expenses.   Do we really want them to decide to put off having kids because of the expense?  Universal coverage of maternity care is the ultimate pro-life policy, and could help address our declining birth rate and diminish our economic need for immigration. 
   
   Obstetricians and hospitals might be unhappy - Medicaid currently pays for over 49% of births- and pays lower rates (by about 50%).  Does anyone want pregnant women to not have coverage for their prenatal care and deliveries?
   
    
4. Provide universal coverage for kids
   
   Kids are cheap!  There are a few expensive neonatal ICU babies (there will be fewer if we have universal maternity coverage), and a few kids get leukemia or have horrible diseases.  But overall, the costs of adding universal pediatric coverage are tiny.   Kids are our future.   Kids who have access to medical coverage have better academic outcomes, are less likely to land in jail, and will pay more in taxes over their lifetimes.  Childhood vaccinations are one of the two medical services that genuinely save money beyond their costs. (The other is birth control, and the Trump Administration is effectively reversing the ACA coverage mandate).   Also- for those who think that laziness or sloth is responsible for poverty, kids didn't do anything "wrong" to land on the wrong side of the wealth divide in our country.

Pediatricians are more likely than other physicians to accept Medicaid, and the loss to hospitals will be small as kids aren't hospitalized that much.  Fees for kids could be set somewhere between Medicaid and private insurance rates so that we don't produce a devastating shortage of pediatricians in the future through underfunding now.

There you have it.  Four things that can be done now to make health care better and advance the cause of single payer at some point in the future.  So next time a politician says "I will get together a committee to  discuss next steps," don’t accept that answer!