The Good and The Bad of Health Care Reform
Let's start with The Bad - Obamacare.
The uninsured rate for those ages 45 to 64 jumped to 10.3% in 2018, up from 9.3% a year earlier, according to a report from the Centers for Disease Control and Prevention published Thursday.
It's the first time a government study has shown an increase in the rate, though polling and research groups had previously found that people had been losing their health insurance since President Donald Trump took office.
Then there is The Worse.
Though Medicaid is a federal program, states can proposition for changes in their administration of funds and benefits. If approved by the state Senate, HB955 would authorize Governor Ron DeSantis to ask the federal Department of Health and Human Services for a Section 1115 waiver, granting permission to impose a new work requirement of 20 hours per week on adult Medicaid recipients who aren't disabled. But 20 hours of work at Florida's minimum wage of $8.46 per hour would yield about $677 per month, well above the state's income limit of 33 percent of federal poverty level for Medicaid eligibility, creating a bind that's all but certain to eliminate coverage for Florida's very poor either way.
Have no fear, because here is The Good.
Washington state will become the first in the U.S. to offer a public option for health insurance to all its residents, according to ABC. The option, known as Cascade Care, will include tiered plans that will cover standard health services and are expected to cost up to 10 percent less than private insurance. The plans will be available to all Washington residents regardless of income.
The Washington legislature passed the plan in April, and Gov. Jay Inslee, who is running for president in 2020, is expected to sign it on Monday. Similar public options have been proposed in eight states, including Colorado and New Mexico, but Washington is the first to successfully pass a bill.
The model that will be put in place in Washington is one that’s supported by some of the centrist candidates running for office in 2020. It doesn’t cut out private insurance companies, but instead incorporates them into the public plan...With their new plan, Washington will avoid the obvious way of saving money on healthcare: cutting out insurance companies. Instead, Cascade Care lets insurance companies remain central to healthcare by hiring them to administer the plan.
And here is The Better.
The Congressional Budget Office issued a report on May 1, 2019 titled "Key Design Components and Considerations for Establishing a Single-Payer Health Care System." This report reviews a range of considerations as regards the design and implementation of a single- payer system as applied to the United States.
...The CBO does not take an explicit position as to whether a single-payer system will also deliver benefits for the 65 percent of the population which presently has full health-insurance coverage. On the one hand, the report does note both the prospects for both improved outcomes as well as reduced costs as regards this population cohort, observing that:
Unlike private insurers, which can experience substantial enrollee turnover over time, a single-payer system without that turnover would have a greater incentive to invest in measures to improve people’s health and in preventive measures that have been shown to reduce costs.
It is also the case that both the Jayapal and Sanders bills offer more extensive coverage than is currently provided under a typical employer-sponsored policy, including significant support for long-term care. Expanding coverage in such ways should further improve overall health outcomes for those already insured. But the CBO also recognizes that the expansion of coverage to the uninsured and underinsured will entail increased overall demands on the country’s supply of health care resources. It is therefore possible, as the report notes, that this could produce shortages in terms of availability of providers, which, in turn, could mean reductions in quality of care. This is a legitimate issue which the CBO has properly highlighted.
More specifically, the single-payer system will need to be capable of establishing measures through which the provision of provider services can increase to match the increased demand resulting from universal coverage. I examined this question in depth in a 200-page peer-reviewed study with co-authors released last November, "Economic Analysis of Medicare for All." In our study, we conclude that a single-payer system will produce major reductions in the administrative burdens throughout the whole health-care system. The CBO report also recognizes this prospect for major reductions in administrative burdens under single-payer. These dramatic cuts in administration will then mean significantly less paperwork for doctors and nurses, freeing them to spend more time treating patients. On balance, our study concluded that this effective increase in the providers’ available time to treat patients should roughly match the increased demand for their services resulting from universal coverage.
But the report does not take a position as to whether a U.S. single-payer system will be able to successfully control costs. Rather, the study concludes that:
The cost of a single-payer system would depend on various design choices such as the services covered, cost-sharing requirements, and provider payment rates.
In addition to those design choices, policymakers could consider using two other techniques to contain the growth of government spending on the single-payer plan and total health care spending: global budgets and utilization management. (p.26)
The CBO assessment here is indisputable. It is therefore incumbent on the designers of a single-payer system to consider the range of design choices with great care, to achieve the potential cost savings that are available through a well-designed system.