Poll Vault: Reuters Poll Shows Majority of Americans Think Costs Will Increase in the Next Year
Posted by The Campaign on December 03, 2009 at 11:43 AM
"Believe the amount of money spent on healthcare will be less 12 months from now: 52 percent strongly disagree, 13 percent strongly agree."
For the full article, click here.
ICYMI: Time Magazine's Karen Tumulty -- Experts Believe Legislation in Congress Will Ultimately Increase Costs
Posted by The Campaign on December 03, 2009 at 10:27 AM
Time Magazine's Karen Tumulty cites experts' concerns about the current health reform proposals in Congress, which highlight the bills' shortcomings in terms of cost-saving measures.
Here are a few key excerpts:
"...what about [the] pledge to pass a measure that reins in the larger forces driving up health care costs? Or [the] vow that a reformed system would deliver more-efficient care, with better results for patients? That's where the legislation could fall well short of the promises."
"...economists — as well as other health experts — are watching in dismay as the legislation's reforms and cost-saving measures are whittled away by powerful special interests."
"While families' health bills may go down, they say, costs for the government — and ultimately taxpayers — are sure to rise."
"The legislation in Congress is chock-full of pilot projects designed to test out ideas for lowering costs. But critics contend that such projects work to preserve the status quo. 'We don't need pilots. We have enough information,' says Kenneth Thorpe, chairman of the health policy department at Emory University. 'Let's go ahead and get on with this.'"
For the full article, click here.
ICYMI: The WSJ Argues that CBO's Premium Analysis Underestimates Cost Increases
Posted by The Campaign on December 02, 2009 at 7:45 AM
A Wall Street Journal article asserts that premiums will increase even more than projected by the CBO.
Here are a few key excerpts:
"CBO found that premiums in the individual market will rise by 10% to 13% more than if Congress did nothing. Family policies under [the current Senate proposal] will jump to $15,200."
"So the bill will increase costs but it will then disguise those costs by transferring them to taxpayers from individuals...The Reid bill's $371.9 billion in new health taxes are also apparently not a new cost because they can be passed along to consumers, or perhaps will be hidden in lost wages."
"CBO is almost certainly underestimating the cost increases...One reason is community rating, which forces insurers to charge nearly uniform rates regardless of customer health status or habits. CBO doesn't think this will have much of an effect, but costs inevitably rise when insurers aren't allowed to price based on risk."
"In a 2008 paper in the peer-reviewed Forum for Health Economics and Policy, these economists [Amanda Kowalski of MIT, William Congdon of the Brookings Institution and Mark Showalter of Brigham Young] found that state community rating laws raise premiums in the individual market by 20.9% to 33.1% for families and 10.2% to 17.1% for singles. In New Jersey, which also requires insurers to accept all comers (so-called guaranteed issue), premiums increased by as much as 227%."
For the full article, click here.
ICYMI: Former Insurance Commissioner and AHA Study Look at Impact of Cost-shifting
Posted by The Campaign on December 01, 2009 at 9:35 AM
Experts and economists agree that a driver of health care costs is cost-shifting, which happens when providers (doctors and hospitals) are not paid the full amount of the cost of providing services by the government which then causes costs for individuals, families and employers with private insurance to go up.
Below are an OpEd and a study from the American Hospital Association focused on cost-shifting:
1) The Olympian, Frank Byles – Cost shifting is a big part of the problem in health care
"The single greatest cause for the unaffordability of health care is cost shifting by the federal government."
“Cost shifting is when a doctor pays one dollar for a bandage to put on your wound and Medicare/Medicaid reimburses only 70 cents. Now, the doctor must recover this loss by charging paying patients/insurance enough more to cover the loss. This method of financing medical services is very inefficient and costly to those who actually pay for services.”
"Generally, over 40 percent of a person’s total lifetime medical expenses will be incurred during their last year of life usually when they are on Medicare/Medicaid. Not many people or employers will be able to afford such a horrendous increase on top of already unreasonable health insurance costs."
For the full article, click here.
2) American Hospital Association Cost-Shifting Study
Here are the two studies:
AHA's Underpayment by Medicare and Medicaid Fact Sheet
AHA's Uncompensated Hospital Care Cost Fact Sheet
AHIP Perspective: AHIP Statement on CBO Report
Posted by The Campaign on November 30, 2009 at 12:22 PM
AHIP's Robert Zirkelbach issued the following statement on today's CBO report:
“This is the latest report to confirm that the current health care reform proposal fails to bend the health care cost curve and will result in double-digit premium increases for millions of Americans.”
Highlights from the CBO report:
· Failure to bend the cost curve: The CBO analysis confirms that the current health care reform proposal does not bend the cost curve – a key goal of health care reform.
· Double-digit premium increases for millions of Americans: CBO projects that premiums will increase for many people higher than they would under current law. The CBO and JCT analysis estimates “that the average premium per person covered (including dependents) for new nongroup policies would be about 10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law”.
· One in five workers could lose their current coverage: According to CBO, “an estimated 19 percent of workers with employment-based coverage would be affected by the excise tax” in 2016. Further, the analysis states that “those who kept their high-premium policies would pay a higher premium than under current law”, but “most people would avoid the cost of the excise tax by enrolling in plans that had lower premiums; those reductions would result from choosing plans that either pay a smaller share of covered health care costs (which would reduce premiums directly as well as indirectly by leading to less use of covered medical services), manage benefits more tightly, or cover fewer services”.
Other Factors to Consider:
· Subsidies do not lower premiums: Subsidies are essential to helping low- and moderate-income families afford health care coverage. But in the same way that Pell Grants do not lower the cost of college tuition, subsidies do not reduce underlying medical costs.
· Incentive for people to delay purchasing coverage: Most experts agree that the current proposal provides a powerful incentive for people to wait until they are sick to purchase coverage. This unfairly penalizes current policyholders who will be forced to cover the cost of providing care to those who wait to purchase coverage.
· Ignores regional variation in premiums: The CBO analysis estimates the nationwide average premium rather than examining the impact in each state across the country. Some states previously enacted guarantee issue and community rating reforms which led to significant premium increases in the individual market in those states. The current proposals would cause average premiums to decrease in those states while dramatically increasing premiums for people in states that currently allow medical underwriting.
· Ignores cost-shifting to families and employers with private coverage: Experience has shown that when doctors and hospitals receive less money from Medicare and Medicaid, they charge more to families and employers with private coverage to cover those costs. According to a Milliman, Inc., the average family of four is currently paying $1,500 in higher premiums as a result of this cost-shift. New Medicare cuts and a new government-run plan would exacerbate cost-shifting to families and employers.
· Many policies would not be protected under “grandfather” clause: The provision that supposedly “grandfathers” people into their current plans offers limited protection against higher costs because one-third of Americans change their coverage each year. Anyone who changes jobs, gets married or divorced, has a child or moves to another state would not be protected by the grandfather clause.
ICYMI: Jim Roche -- Congress Not Placing Enough Emphasis on Controlling Costs
Posted by The Campaign on November 30, 2009 at 11:47 AM
Jim Roche, President and CEO of the Business and Industry Association, foresees increased costs brought on by current legislative proposals.
Here are a few key excerpts:
"It’s remarkable, therefore, that health care reform under consideration by our congressional delegation in our nation’s capital seems very likely to add to health care costs, not reduce them. What happened to 'bending the cost curve' and eventually lowering it?"
"Pick your source – the Congressional Budge Office, the Lewin Group, the Centers for Medicare & Medicaid Services and others – and they conclude that health care reform legislation under consideration by both chambers of Congress will, incredibly, increase costs, not lower them."
"More underfunding from the federal government means more cost-shifting to the business community in the form of higher health insurance premiums. How is this reform?"
For the full article, click here. "Until the great health care reform debate shifts emphasis away from its current focus on expanding government health care programs or creating new ones, and toward reforming payment incentives, there will be no bending of the cost curve...And that curve will continue to rise and employers will find it increasingly difficult to provide a critical benefit for their employees and compete in the global economy."
ICYMI: Experts Say Health Care Bill Do Nothing to Lower Costs
Posted by The Campaign on November 30, 2009 at 11:22 AM
David Lightman of McClatchy Newspapers cites several experts on the health care bills' lack of cost control.
Here are some key excerpts:
"'The problem is that historically, Congress has not been able to keep its word on constraining costs,' said Amitabh Chandra, a professor of public policy at Harvard University's John F. Kennedy School of Government."
"'As long as the payment process is tied up with the political process, it's highly unlikely we'll see the kinds of savings you expect to see,' Chandra said."
“Nothing is guaranteed, the CBO warned. ‘These longer-term calculations assume that the provisions are enacted and remain unchanged throughout the next two decades, which is often not the case for major legislation.’”
"'Considering the dismal state of our budget, we need to do better,' added Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, another bipartisan watchdog group devoted to fiscal discipline."
For the full article, click here.
ICYMI: Former Oregon Governor on Costs and Health Care Reform
Posted by The Campaign on November 30, 2009 at 11:03 AM
"'I don't believe that what's going to come out of Congress is going to have any impact on the medical cost inflation, which is what's really crushing individuals and businesses, and really putting the country at economic risk,' he says."
For the full article, click here.
ICYMI: San Francisco Chronicle -- Current Legislation Fails to Control Health Care Spending
Posted by The Campaign on November 30, 2009 at 8:27 AM
The San Francisco Chronicle examines the lack of cost control measures in the current reform proposals.
Here are a few key excerpts:
"But many experts, including some who signed the letter, said Orszag is only partly right…Nearly everyone agrees that the bill's cost controls have been weakened and may grow weaker. And all agree that the House bill would do even less."
"The cost question is vital. Lack of affordability is why 47 million people don't have health insurance and why millions more risk losing it. Rising costs are devouring wages and bankrupting individuals, businesses and government at all levels. They are a main driver of scary U.S. budget deficits. Failure to slow health spending would aggravate the nation's economic problems; success could begin to address them."
For the full article, click here."'One of the worst consequences would be if the U.S. government promises 300 million people health care reform and health coverage for everyone - and then can't pay for it,' said Ralph Neas, head of the National Coalition on Health Care, a group of business, labor and other groups. 'There is going to be a considerable public backlash.'""Worse would be the economic effects. 'It's not just the health care system at stake,' Neas said. 'It's our economic system writ large. We cannot have a situation where costs continue to grow at this rate.'""If new legislation requires people to buy insurance they cannot afford, it will fail. If it promises coverage without controlling costs, the coverage cannot be sustained."
ICYMI: Economist Argues Legislation Will Not Slow Premium Growth
Posted by The Campaign on November 30, 2009 at 8:08 AM
“…there isn’t agreement that such measures go far enough to slow spending…That’s ‘not being addressed much in any of the legislative proposals,’ says Christine Eibner, an economist with RAND, a think tank. Because of that, ‘I don’t think there’s any reason to think (premium growth) will moderate.’”
For the full article, click here.
