Archive for September, 2009

See Below: Reader Wins the Silly-Sign-Sighting Award. Come on, you know better: Medicare IS a Public Option (Socialized Medicine). Most people love it.

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September 23, 2009 at 3:19 pm 2 comments

Medicare Private Insurance Companies Are At It Again

Late last week Humana, one of the largest private insurance companies offering Medicare Advantage and prescription drug plans under Medicare, sent a letter to the Medicare beneficiaries enrolled in their HMOs and other Medicare Advantage plans.  The outside envelope warned that the letter contained important information about their Medicare benefits.  The letter itself said that Congress was considering cuts to Medicare in its health care reform legislation, these cuts would result in reduced benefits for Humana plan enrollees, and enrollees should contact their members of Congress to protest the cuts.

This is not the first time that private Medicare plans have written their enrollees with misinformation about alleged Medicare cuts.  The Center for Medicare Advocacy and a number of other beneficiary organizations have been concerned for years about these kinds of mailings by private Medicare plans.  We recently asked CMS to modify its guidance to private Medicare plans in order to specifically identify these communications as marketing materials,  which are subject to CMS oversight and review.  We said in our comments:

We are very concerned about plan sponsors soliciting their enrollees to join “grassroots” efforts to influence Medicare policy via member newsletters and other means. …We believe there should be a prohibition on plan sponsors soliciting members’ participation in political activities, particularly those that benefit the plan sponsor, and urge CMS to analyze whether such activity already violates current law.

CMS did not amend its guidance to plans per our suggestion, but it did take swift action against Humana.  CMS sent a letter to Humana yesterday telling the organization to stop sending misleading and confusing communications, and that it believed such communications are potentially contrary to federal regulations and guidance.  CMS further advised that the agency takes this matter very seriously and could pursue compliance and enforcement actions.  CMS also sent a comparable memo to all private insurance companies telling them not to send similar communications.

We thank CMS for acting so swiftly to curb misleading and confusing communications to people in their Medicare plans.  While we are pleased that the government is exercising its oversight and enforcement authority, we see this incident as another example of how reliance on private insurance companies can generate confusion and fear for Medicare beneficiaries. This happens because the interests of private Medicare plans are not always in accord with the interests of Medicare beneficiaries.

September 22, 2009 at 8:01 pm Leave a comment

How Will We Know If Good Enough is Good Enough?

We now have four health care reform bills and a proposal from the Senate Finance Committeee, the last of the Congressional committees with jurisdiction over this topic.   None of the bills are perfect and the Senate Finance Committee’s proposal, lacking both a public option and any Republican support, is the most disappointing.  Still, as Paul Krugman writes in today’s New York Times, several countries, including Switzerland and the Netherlands, manage to provide health insurance for all largely through the private market

So, how will we know if we should support what emerges as the final health care reform bill?  Here are six key standards to determine whether the final bill is good enough to support – let us know if you have others:

  1. Will the bill make quality health care coverage available to all, especially to the uninsured, underinsured, and those who will fall into these categories in the future?
  2. Will the bill provide real competition in the market place, with or without, a true public plan, so that reform will be reasonably affordable? 
  3. Will the bill provide adequate help for people of low and moderate incomes to purchase good quality health coverage ?
  4. Will the bill preserve and fairly enhance the Medicare program for future generations?
  5. Will the new coverage be adequately comprenhensive, understandable and easy to use?
  6. Will the new law provide a fair, accessible appeal system for people to contest denials?

I am often told not to let the perfect be the enemy of the good.  We will not get “the perfect” health care plan.  We may not even get “the good”.  But – will we get “the good enough”?  Too soon to tell.

September 18, 2009 at 6:00 pm 1 comment

Watch Robert Reich, Former Secretary of Labor, On Why We Need a Public Option (And what it is!)

In a new video, Robert Reich speaks about the necessity of a public option in health care reform.  Secretary Reich wrote us today summarizing his thoughts:

“A true public option is necessary to pressure private insurers to compete on quality and price, and to pressure drug companies and other medical providers to offer better deals. It’s the only way to expand coverage while continuing to reduce overall costs. Every American should have the freedom to choose a public insurance plan if they wish. ”

Watch Robert Reich now, and spread the word.

September 14, 2009 at 9:54 pm Leave a comment

They All Clapped

Okay, maybe not everybody, but most members of Congress, Democrats and Republicans, applauded last night when President Obama pledged to safeguard Medicare, calling it a “sacred trust” with older Americans.  

What the President didn’t say, and what too many people forget, or try to, is that Medicare IS a public health insurance program.  It was created and is broadly  implemented by the federal government; claims are administered by private insurance companies. For everyone who applauds Medicare – and most people do – support a public option so we can pass the sacred trust of health care security on to younger generations!

September 10, 2009 at 1:46 pm Leave a comment

Watch and See Why We Need A Public Health Plan

An animated cartoon is worth a thousand words:

http://www.youtube.com/watch?v=Jng4TnKqy6A.

September 8, 2009 at 5:33 pm 1 comment

Why the Public Option is Critical

Stephen M. Davidson
Professor of health policy and management at the Boston University School of Management
Originally posted on the Huffington Post, August 19, 2009 02:03 PM

The health reform proposals being considered by Congress depend on private insurance companies competing. Proponents of this strategy believe that to win subscribers from competitors, insurers will need to find innovative ways to keep costs down at the same time they provide good coverage. To keep them focused on providing good value to the public, some of the proposals, including the President’s original one, include a public plan to compete with the private firms. If retained in the bills, this contentious provision may sink the reform effort. So, how important is it to achieving reform’s goals?

The answer is no mystery: The competition strategy is so weak that the public option is essential. The fact is that competition is a good thing only when it produces innovation that leads to better, less expensive things for sale. The new computer we bought a year ago was faster, more powerful, and less expensive than the one it replaced — in part, at least, because of competition.

The U.S. already has the most competitive health insurance system in the world. Many insurers make lots of money. How do they do it? My colleague, Jim Post, who has studied the industry, reports insurers have only 3 factors to work with: who is covered (availability), what they are covered for (quality), and price. So, among other things, in the present, badly broken system, they refuse to cover people with pre-existing conditions or make coverage so expensive for such people that they cannot afford it. They provide coverage that excludes some of the services their subscribers need. They charge cost-sharing amounts that make doctor-recommended services unaffordable for many covered patients. They introduce administrative procedures that make it difficult for patients to receive and doctors to provide covered services. And with it all, instead of falling, premiums keep rising and lead increasing numbers of employers and employees to drop coverage.

So, given this history, how do policy makers arrange for a competition-based strategy that will cover everyone and keep costs under control? The president and his allies in Congress have proposed 2 main strategies. One is to impose regulations that prohibit the firms from using the tactics just described. Guaranteed issue and renewal, community-rated premiums, and limits to cost-sharing would be required.

But if private insurers can no longer engage in the tactics that got them to profitability, what methods are left to them? How will they keep spending under control at the same time they provide value to the public? That is a question they should be forced to answer.

To protect the public against the possibility that they will find ways to vary the 3 factors in their control in ways that undermine the reform goals, the second proposed strategy is to introduce a publicly operated plan to compete with the private firms. The primary mission of this government-run insurer would be to offer affordable coverage for people who could not find it from private firms. It would not need to earn a profit for shareholders, nor to engage in expensive marketing campaigns to win subscribers. In order to avoid losing too many subscribers to it, the idea is that private insurers would need to respond to its offerings. The coops that are suggested as a substitute pale in comparison.

The best hope insurers — and the public — have to achieve the goals of reform is to change the incentives on providers by ending fee-for-service payment and to promote the development of integrated group practices which would have the means to furnish better, more efficient care. This being the case, should we expect insurers to contract selectively with physicians and pay capitation rates? Will they encourage creation of integrated delivery systems which, being fewer in number and larger than most of today’s practices, would have more bargaining clout over rates and terms?

If we are stuck with a competition-based strategy, the public option is the last, best chance for private insurers to show us they can provide better value at lower cost. The public option is needed because the insurers have already demonstrated that they do not do that on their own.

Supporters of reform should demand that Senator Conrad and his like-minded colleagues who oppose the public option answer these questions: In the absence of the public option, what actions will insurers take to accomplish the goals of reform? And why they have not used them until now?

Advocates of the public option should not allow themselves to be put on the defensive. Instead, they should insist that opponents explain what innovations insurers will introduce to provide good value at affordable prices.

Stephen M. Davidson, a Boston University School of Management professor, is author of the forthcoming book, In Urgent Need of Reform: The U. S. Health Care System.

September 2, 2009 at 7:17 pm 1 comment


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