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‘Medicare For All’ Can Be a Common Enemy to Unite ‘Foes’

It is both comical and infuriating to watch how key healthcare stakeholders react to two different, but highly inter-related subjects: 1) Medicare For All, and 2) Who is at fault for outrageous medical prices. Stakeholders in healthcare include hospital systems, provider groups, health insurance companies and pharmaceutical and device manufacturers. Employers are another major stakeholder, but much too often, they are largely excluded when it comes to contractual relationships between many of the aforementioned players.

When many of these stakeholders are asked who is at fault for charging high prices for medical services, each will conveniently step into a circle and point fingers at one another, as if they are participating in a circular firing squad. It seems that someone else is always at fault, but never the accused.

However, when asked about the growing ‘Medicare For All‘ proposals, commonly believed to eliminate private insurance and ‘socialize medicine,’ many of these same stakeholders will quickly hold hands in support of something centrally sacred to their collective well-being, as if they are military comrades in the HBO mini-series, “Band of Brothers.” These stakeholders’ words and actions are quite transparent about protecting their own self-seeking interests.

Below are just a few examples of this love-hate relationship between various healthcare stakeholders.

Medicare For All

Former Secretary of State, Condoleezza Rice, was quoted as saying, “We need a common enemy to unite us.”  For stakeholders who are frequently at odds with each other, such as medical providers are with insurance companies when it comes to contractual reimbursement arrangements, the relationships can be confrontational, if not outright brutal. However, for various reasons, both typically view Medicare For All as a major threat to their profitable well-being, if not survival. Given what is at stake with a ‘Single-Payer’ system that presumably would be controlled by federal bureaucrats, providers and insurers have found this ‘common enemy’ to mask their mutual differences with each other.

On April 16, UnitedHealth Group CEO David Wichmann warned Democrats that Medicare For All would destabilize the nation’s healthcare system. As mentioned in The Hill, Medicare For All would be a “wholesale disruption of American healthcare [that] would surely jeopardize the relationship people have with their doctors, destabilize the nation’s health system, and limit the ability of clinicians to practice medicine at their best.”

Insurance companies are greatly threatened by the many proposals initiated by progressive Democrats to expand Medicare to the entire U.S. population, most likely greatly reducing the role of private insurers. It must be noted, however, even with any given Medicare For All program implemented, private insurers would most likely be chosen as subcontractors to administer the program, but the profit motive would be greatly reduced from today’s standards.

Not to be outdone, a major counterpart to private insurers, the American Hospital Association (AHA), have similar views to Wichmann’s. AHA President Rick Pollack wrote in February that Medicare For All proposals “could do more harm than good to patient care.” Additionally, this one-size-fits-all approach could disrupt coverage of 180 million Americans who are currently covered by employer plans, and that physicians and other providers “may limit the number of Medicare or Medicaid patients they see because of chronic government underpayment.”

When lobbyists from both stakeholders were recently on stage together in Nashville addressing the Medicare For All topic, such as Matt Eyles (CEO of America’s Health Insurance Plans (AHIP)) and Chip Kahn (CEO of the Federation for American Hospitals), one could almost detect John Lennon’s epic song, “Give Peace A Chance” in the background. Kahn discussed a new organization that he formed, Partnership for America’s Health Care Future, and its purpose of ‘counter-messaging’ against the Medicare For All movement. Eyles acknowledged that AHIP was one of the first groups to become part of this new organization.

Healthcare Prices – Who is at Fault?

The camaraderie found in Medicare For All quickly vanishes when stakeholders are simply asked why healthcare prices are so high. This healthcare ‘hot potato’ can quickly determine just how deep-seated relationships are (or not) between major industry players. The April 15 cover of Modern Healthcare appropriately illustrates fingers pointing at each other, deflecting the price question and placing the blame elsewhere. Additionally, when leaders from Pharmacy Benefit Managers and the Pharmaceutical Research and Manufacturers of America (PhRMA) have appeared in front of the Senate Finance Committee during the past few months to justify their pricing methods, both pointed fingers at one another (insurers also), making sure that their respective organizations and industry were not to blame.

Deflecting responsibility and other self-preservation behaviors will only add to the desire to seek alternative solutions that can reform a grossly underperforming and bloated healthcare system. Stakeholder organizations and industries must decide whether they want to be part of the solution – or, at their own peril – continue to pursue their ‘business-as-usual’ behavior that benefits no one – but themselves.

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Single-Payer Debate: Gaining Traction?

What do the terms ‘Single-Payer’ and ‘potato’ have in common?

The English language can be confusing at times. For example, the words, ‘either’ and ‘neither’ can be pronounced two different ways. What about ‘tomato’ and ‘potato?’ Yep, even song lyrics from ‘Let’s Call the Whole Thing Off’ described the pronunciation conundrum of potato, potahto, tomato and tomahto.

But there’s another problem with words. We sometimes use different words or phrases interchangeably. This is certainly the case in healthcare. Many times, politicians and the media will use ‘health,’ ‘healthcare,’ and ‘health insurance’ as if they mean the same thing. Although they’re inter-related, they have different meanings.

Another healthcare issue that appears to be gaining some traction is the ‘Single-Payer’ debate. But what does ‘Single-Payer’ actually mean? Is it synonymous with ‘Universal Healthcare’ or ‘Medicare for All?’ These terms are thrown around quite loosely as we debate our country’s future on how to deliver and pay for the healthcare we consume. Do all three represent a ‘government takeover’ of our healthcare delivery and payment system?

Here is a primer of the three aforementioned terms:

Single-Payer

This plan creates a single source of payment to healthcare providers, typically through a state or federal program. Financed by taxes, a single-payer approach would cover basic healthcare costs for all residents regardless of income, occupation, or health status. It is important to note that single-payer systems may contract for healthcare services from private organizations (similar to Canada) or may own and employ healthcare resources and personnel (as found in the United Kingdom). ‘Single-Payer’ describes the mechanism by which healthcare is paid for by a single public authority, but not the type of delivery for whom physicians and providers work. The U.S., by contrast, uses a multi-payer approach that includes a mixed public-private system.

Universal Healthcare

This plan is often used interchangeably with ‘Universal Health’ and ‘Universal Care.’ This is a broad term for a program that makes some level of basic coverage available to everyone (most likely through a government program), but can also allow for private insurance. Universal Healthcare will typically refer to a healthcare system that provides healthcare and coverage (health insurance) to all citizens of a particular country. Such coverage provides a specific package of benefits to all members of a society with the goal of providing financial risk protection, improved access to health services and improved health outcomes. Contrary to detractors of Universal Healthcare, it is not one-size-fits-all and does not imply total coverage. In short, Universal Healthcare can be determined by three dimensions:

  1. Who is covered
  2. What services are covered
  3. How much of the cost is covered.

Usually some costs are borne by the patient at the time of consumption, but the bulk of costs come from a combination of compulsory insurance and tax revenues. In some cases, government involvement includes directly managing the healthcare system. However, many countries with Universal Healthcare use mixed public-private approaches to deliver this care.

Medicare for All

This is a universal system in which the basic coverage would be provided by an expansion of the federal Medicare program, but would still allow citizens to purchase private insurance (supplemental plans). It is a single-public or quasi-public agency that organizes healthcare financing, but the delivery of care remains largely in private hands. As we know, Medicare is a federal health insurance program (administered by privately-contracted organizations) for people who are age 65 or older and certain younger people with disabilities, including those with End-Stage Renal Disease. According to the Kaiser Family Foundation and other sources, the administrative costs under Medicare are lower compared to private plans. Bernie Sanders famously argued that correcting the inefficiencies within our current system would actually pay to expand coverage for all Americans. In lieu of designing a whole new healthcare system in the U.S., Medicare-for-All proponents suggest that disruption would be minimal to stakeholders and citizens by merely embracing a program that we already use for a segment of our population.

The nuances of all three approaches can vary immensely, even within each of the above healthcare categories. No two countries with single-payer systems are alike. As we all know, the devil will be in the details on who pays for the program, how will payments be determined (taxes vs. premiums), who will administer the health plan(s), and how will health providers be allowed to practice – either privately or government-employed.

As Senate Republicans attempt to cobble together 50 votes to “repeal and replace” Obamacare, a handful of legislators in Democratic states have proposed some variation of single-payer bills – California, Massachusetts, New York, New Jersey and Rhode Island. The likelihood of these states passing such measures are quite remote at this time, primarily due to divided political ideologies and funding estimates that wreak havoc on fragile state budgets. Not to be outdone, 112 of the 193 U.S. House Democrats are positioning themselves for the 2020 national elections by supporting a broader version of public health coverage – endorsing the “Expanded and Improved Medicare for All Act.

Given the inability of Congress to come to a consensus on replacing Obamacare, will a single-payer or some hybrid-approach ultimately emerge as an alternative? A January study published by the Pew Research Center indicated that a sizeable majority – about three in five Americans – said the government had a responsibility to ensure everyone had healthcare (compared to 38 percent who said it is not the government’s responsibility). A few influential business leaders, such as Warren Buffett and Charles Munger, appear to have some interest in the idea of a single-payer approach, primarily because health costs continue to be a drag on the economy.

As I write this blog about single-payer nuances, the three approaches appear to be synonymous with one another. Any future state and national proposals will no doubt be a hodge-podge of all three approaches.

When that time comes, it will most likely become one hot potato!

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