Last week’s post highlighted encouraging initiatives in several states to implement a single payer system within a single state.
This was always a daunting challenge even before health reform. The Patient Protection and Affordable Care Act has raised the bar even higher.
ERISA and its preemption
Before PPACA a legal hurdle called the ERISA preemption severely hamstrung state health reform efforts. For those of us in the employee benefits profession, ERISA, including its preemption clause, is our bible or at least our Deuteronomy.
ERISA was passed by Congress in 1974 to regulate employee benefit plans. The preemption clause precludes states from regulating employee benefit plans. There were two exceptions to that preemption and both are instructive.
Insurance and not insurance
Under the McCarran Ferguson Act of 1945 states have the authority to regulate insurance plans. Under ERISA states still retain the right to regulate insured health plans.
After the law was passed, Congress figured out that the state of Hawaii had already established a law requiring employers to provide health insurance to their employees. I guess news travels slowly from Hawaii. Congress passed the first of many subsequent amendments to ERISA making an exception to the general preemption for Hawaii.
One reason for the preemption clause was the belief that Congress would tackle national health care reform soon and they wanted to protect that right at the national level, a theme that would reappear in PPACA.
The consequence of allowing states to only regulate “insured” health plans was the movement by many larger employers to “self-insured” plans. By taking on the risk of health insurance themselves, employers escaped the mandates imposed by state insurance departments. Companies operated in multiple states could establish uniform benefit designs for all of their employees. At least one source estimates about 43% or 53 million people with health care coverage are regulated by ERISA and not by state insurance departments.
When Congress exempted Hawaii from the preemption clause they only exempted the Hawaii law as it existed in 1974. Employers have since discovered the loopholes in Hawaii law for part time employees and contract employees. Now, even though Hawaii has always had the lowest rate of uninsured in the country, that number is increasing as more and more employers exploit that loophole.
The ERISA preemption prevents efforts by state to expand coverage by requiring employers to offer health insurance. Instead they are confined to a hodgepodge of confusing and complicated programs to expand state Medicaid insurance programs or offer subsidies to small employers.
Obama blocks states?
The PPACA does not make it easier for state single payer advocates. The Obama Administration vigorously opposed bipartisan efforts in the House Education and Labor Committee to give states more latitude as laboratories for reform.
Photo Credit: Maui-Tropica
An improved patient delivery system is a necessary pre-condition for affordable and quality health care.
What do I mean by a “patient delivery system”?
Understanding patient delivery system means recognizing that people without health insurance do not receive treatment until they are in an immediate life-threatening situation.
I cannot back this up with a scientific study, only my daily experience. But that experience contradicts an oft cited myth that no one who needs health care is turned away. One of the most common reason that people call our office is because something happened to their health insurance that lead to a denial of treatment.
It may be as simple as the doctor calling the wrong number or it may be that the member has failed to pay their share of their health insurance premium. But the reasons don’t make the stories any the less heart breaking.
You have heard the arguments.
In the first corner: “We have the best health care system in the world. People travel to this country from all over the world to get the best health care. the parking lots in hospitals bordering Canada are full of cars with Canadian license plates.”
In the second corner: “There are 100,000 deaths per year from hospital infections and a similar number from prescription drug errors, and an equally horrific number of people who need to be re-admitted to the hospital for complications. And what about “Never Events”, those medical errors that are described as adverse events that are unambiguous (clearly identifiable and measurable), serious (resulting in death or significant disability), and usually preventable.
And there is a voice in a third corner: “We have the most expensive health care system in the world yet the United States is not ranked among the top twenty nations in infant mortality, maternal mortality, longevity, or hospital admissions avoidable with access to health care.”
It’s a bit like arguing who won the Super Bowl (this is Super Bowl weekend, after all) by comparing rushing yardage, passing yardage, first downs, time of possession. Unlike football, in health care there is no touchdown metric, no definitive “points on the board” that decides health care quality.
Which corner would you pick?
Is health care reform dead? Doubtful? What will it look like? Not nearly enough.
So I want to get a head start on the next round.
Because whatever happens in this round, round 2 cannot come soon enough. It is unrealistic to expect health care reform to be a once and done proposition. The Model T was not invented with 4 wheel anti-lock disk brakes or fuel injection.
So over the next few weeks, I would like to take a look at some of the issues that will still remain even after health care reform legislation is passed.
But first let’s give some thought to what we want from our health care system.
The next time you hear a Republican or a teabagger complain that President Obama is moving the United States closer to "fascism and socialism" (despite the two philosophies being ideologically opposite of one another), remember this: some of these same people are taking thousands of dollars in a form of "socialism" that we usually don’t think about: farm subsidies.
For those not in the know, farm subsidies are when the government pays farmers and businesses in the agricultural field to (a) supplement income, (b) manage commodity supply, and (c) influence commodity cost.
Here’s the dirty little secret: some politicians, mostly Republicans but also a few Democrats, figured out how to make tons of money off of this "socialism for the wealthy." It also comes as no coincidence that most of these particular politicians come from largely rural states.
The Senate Dems are talking about expanding Medicare. Well, expanding Medicare to people over 55. Um, expanding Medicare to some people over 55. Er, expanding Medicare to some people over 55 who can afford to pay the price.
Is this a good idea, or part of a good idea? What and Why?
What is it?
The details are sketchy at this point. The so-called expansion of Medicare is tied to discussions about killing the public option because that insurance company lackey, Senator Joe Lieberman (I, CN), could otherwise kill health care reform demanded by the majority of Americans.
And those right wing nut cases think we lefties are jamming health care reform down their throats?
We turn to the New York Times
The New York Times offered a variety of perspectives on the issue.
This morning driving to work I listened to a story on NPR Morning Edition. It described the effort to build Charles Babbage’s Difference Engine – a mechanical predecessor to today’s computer. Babbage died before he could ever complete his machine but modern engineers have recreated it.
The analogy with health care struck me. Congress is building a Babbage machine in an era of super computers.
And we dare to call it progress?
November 28th, 2009
When a 2,000 page piece of legislation traverses the legislative sausage making process, it is a large target for those who want to take pot shots.
When you are trying to fix a system that is broken in lots of places, it is not an easy process.
Let’s remember what we are trying to fix.
The system does not cover everybody. Estimates on the number of uninsured range from 30 million to 70 million depending on whom and how you are counting.
It’s expensive. Our economy already sets aside more resources per person than any other country on the planet. We pay more in taxes for health care than any other country on the planet.
We are not a healthy country. Relative to other industrial countries, we don’t live long. Our babies die before they reach their first birthday. Our pregnant mothers die in child birth.
That’s a lot of fixes.
In fact, the 2,000 pages is a pretty mediocre start. If either the House or the Senate version survives intact, it still will not cover everybody. It still will be expensive. And there isn’t much reason to believe that we will be any healthier as a result.
But it is a start.
And let’s not forget that simple in the form of single payer (HR 676) was taken off the table very early in the process.
With the election of Barack Obama, there is a lot of hope and optimism about the potential for health care reform.
There is also some nervousness.
The nervousness originates from those who think that the current economic crises will inhibit reform efforts. That somehow the price tag of reform will scare people away from health care reform. I am encouraged by an insightful article by Ezra Klein on Obama’s choice of Director of the Office of Management and Budget.
According to Klein, Peter Orszag believes that health care reform is the key to the fiscal future. Since it his office that will pin the price tag on any health care proposal, his biases matter.
Others are worried that Obama might be soft on insurance companies.
I am not a great friend of the insurance companies. I deal with them every day. But neither am I a knee-jerk opponent of insurance companies.
Insurance companies reflect the markets they operate in. And health insurance companies function in a market that brings out their worst qualites.
Unlike home insurance, or auto insurance, there is no legal or market mandate to have health insurance. This allows health insurance companies to avoid insuring the very people that need it the most – high risk (read sick) individuals.
Outside of the Medicare supplemental insurance market, there are very few limitations on what should be covered or not covered in a health insurance plan. This gives insurance companies the license to put restrictions and exclusions in their policies as they, or their customers, see fit.