Spurred by Apple co-founder and transplant recipient Steve Jobs, the bill has gained support from major politicos, including California Gov. Arnold Schwarzenegger, and is expected to land on his desk this summer.

Meanwhile, on the East Coast, a far more sweeping transplant bill would make every person an organ donor who doesn’t opt out. This would create an organ donation system in New York similar to the ones used in several European countries, but the measure is already facing opposition.

The two states have vastly different bills, but their intents are the same.

With more than 100,000 U.S. patients waiting for organ transplants, better methods of encouraging organ donations are needed, supporters say.

California

This bill creates a living donor registry for kidneys. Read the bill (enter SB 1395)

Patients who need kidney transplants often have friends or family members who are willing to donate their organs. But sometimes, these organs do not match.

Registries have been set up on the Web or by transplant centers where kidney patients and their donors seek to swap organ matches.

Having a state registry would “take it from a process that has been spontaneous and driven by the Web into a more organized fashion, that allows transplant centers to feel a greater degree of security and confidence,” said Dr. Bryan Becker, the president of the National Kidney Foundation, which supports the California bill.

The registry might increase the number of transplants, he added. About one-third of U.S. kidney transplants come from living donors.

Jobs, the CEO of Apple, was a major player in bringing the bill to the forefront, said Schwarzenegger, in a March 19 press conference.

“He’s a wealthy man,” Schwarzenegger said at the news conference. “That helped him get a transplant. But he doesn’t want that — that only wealthy people can get a transplant.”

A pancreatic cancer survivor, Jobs received a liver transplant at Methodist University Hospital Transplant Institute in Memphis, Tennessee, last year.

Livers are scarce, as only about one-third of the people on the national transplant waiting list receive one. Jobs’ transplant stirred controversy about whether celebrity and wealth gained him an advantage.

“He wants every human being — if you have no money at all or you’re the richest person in the world — everyone ought to have the right to get a transplant,” Schwarzenegger said. “This is why he has talked to my wife; he has talked to me to put the pressure on us to get this bill going so there’s enough organs available for all the potential recipients.”

Jobs spoke at the conference and noted that more than 400 Californians died waiting for a liver transplant.

“Last year, I received a liver transplant. I was very fortunate because many others died waiting to receive one while I received one…” he said. “I was almost one of the ones who died waiting for a liver in California last year.”

The bill is expected to be at the governor’s desk by July or August.

Also under the proposal, residents would be asked whether they would like to become organ donors when they receive or renew their driver’s licenses or identification cards. If they leave the box unmarked, a clerk will verbally ask the question.

New York

A New York assemblyman whose daughter’s life was saved by two kidney transplants said he wants more organ donations. One of Assemblyman Richard Brodksy’s most controversial ideas: Make everyone an organ donor unless the individual opts out.

This is also known as “presumed consent” — a marked departure from what’s done in the United States. Several European countries, such as Spain, France, and the Netherlands operate on this concept. Brodsky said this would save more lives.

“We can trust the decency of the American people,” Brodsky said. “But the government needs to come up with a program that lets people express that decency. That’s what’s missing — a connection between the fundamental goodness of the American people and a system that is not producing the organs that save lives.” Read Brodsky’s bill here

Every year, 500 New Yorkers die waiting for an organ transplant, he said.

Another one of Brodsky’s bills would prevent relatives from overriding organ donation decisions made by the deceased.

He became inspired by his 18-year-old daughter, Willie Brodsky, who had transplants because of an autoimmune disease.

While sympathizing with Brodsky’s perspective, Tarris Rosell, a chairman at the Center for Practical Bioethics in Kansas City, Kansas, said presumed consent infringes on individual’s rights.

“The saving of life is a deep, American value, but in this sort of situation, such as presumed consent, it goes up against other American values, like right to privacy, even property rights, which begins with our bodies and a deeply inscribed individualism,” he said.

Some religious and cultural beliefs value the integrity of the body and oppose organ donations, he added.

United Network for Organ Sharing, a nonprofit organization that administers the nation’s organ matching and placement process, does not support presumed consent, because of “inadequate safeguards for protecting the individual autonomy of prospective donors.”

These recent proposals in New York and California do not mean that public opinion toward organ donations is changing, said Sheldon Kurtz, a law professor at the University of Iowa who has drafted organ donation legislation.

“You can’t assume because bills are pending that public opinions have changed,” he said.

By Jerry Geisel

Under the provision, employees would have to meet two conditions to be entitled to the employer-funded vouchers: their family income could not exceed 400% of the federal poverty level; and the premium contributions their employers require them to make must be between 8% and 9.8% of their income. Some experts believe the 9.8% figure was a drafting error and will be changed later in a technical corrections bill to 9.5%.

If those conditions are met, those employees would be entitled to receive a voucher from their employers, and the value of the voucher would not be tied to the plan in which the employee was actually enrolled.

Instead, the voucher’s value would be equal to what the employer would pay if the employee were enrolled in whichever of its plans offered the largest premium contribution by the employer. Experts say it isn’t clear whether “largest” refers to the percentage of the premium paid by the employer or the dollar amount of the contribution.

Then, the employee could use the voucher to purchase health insurance coverage from a state health insurance exchange. The exchanges are authorized under the reform law and are supposed to be set up by 2014.

If the cost of a policy purchased by an employee through the exchange is less than the value of the voucher, the employee could pocket the difference in cash, which would be considered income and taxed.

The voucher feature could prove costly to employers, especially those that have a heavy concentration of low-wage employees—such as retailers—and require employees to make hefty employee premium contributions, relative to their incomes.

And depending on how the legislative language is interpreted in subsequent regulations, it also could prove costly to employers that offer employees a choice of health care plans ranging from relatively low-cost to very expensive plans.

Experts say the provision is almost certain to result in adverse selection, inflating employer costs.

For example, a young, low-paid employee working for a company with a high concentration of older, less healthy and expensive-to-insure employees likely would receive a voucher whose value would be much higher than the cost of buying coverage in an exchange, especially if the employee purchased a lower-cost high-deductible plan. Under the reform law, exchanges can base premiums on the age of policyholders.

As a result, employees remaining with the employer’s plan would be the most costly to insure, pushing up the employer’s insurance premiums.

“We are talking about something that could be very costly to employers,” said Chantel Sheaks, a principal with Buck Consultants L.L.C. in Washington.

“As I read it, any employer that offers comprehensive benefits and has low-wage employees could be impacted,” said Helen Darling, president of the National Business Group on Health in Washington.

Despite the potential financial impact of the provision, few employers have focused on the voucher provision, noted Jennifer Henrikson, a legal consultant with Hewitt Associates Inc. in Lincolnshire, Ill.

The likely reason for that, Ms. Henrikson said, is that employers now have to concentrate on reform-related issues that are more pressing. The voucher provision does not go into effect until 2014, while numerous others, such as elimination of lifetime dollar limits, go into effect beginning in 2011.

The intent of the provision isn’t clear, experts say. A much broader version of the provision was backed by Sen. Ron Wyden, D-Ore., who has sponsored a proposal in which employers no longer would offer coverage to their employees, but instead would give them cash that they would use to purchase health care coverage on their own.

Many issues involving the provision itself are not clear. “There is a lot of complexity here that has to be figured out,” said Sandi Hunt, a principal in the San Francisco office of PricewaterhouseCoopers L.L.P.

For example, the provision says the voucher contribution would be equal to the amount the employer would have paid if the employee had been “covered under the plan with respect to which the employer pays the largest portion of the cost of the plan.”

That legislative language is about as “clear as mud,” Ms. Henrikson said. For example, it isn’t clear whether the largest portion of the premium refers to the percentage of the premium paid by employers or the actual dollar amount employers pay, though experts say it likely is the latter.

If the latter interpretation is adopted through regulation, the provision could have a costly impact on employers that give employees a choice between lower-cost plans, such as consumer-driven health care plans and much more costly plans, such as traditional preferred provider organizations.

Take the case of a young employee enrolled in a high-deductible plan with a premium of $10,000, of which the employer paid $7,000. The employer also offered a more traditional PPO plan costing $15,000, of which the employer paid $10,000.

In that example, the employee would be entitled to a $10,000 voucher, funded by the employer. If the employee then found coverage in the exchange, perhaps similar to the high-deductible plan in which he was enrolled, for $8,500, he could purchase the coverage and then have $1,500 in additional cash. But his employer’s health insurance cost would be $1,500 higher.

Any time of year can be the right time to consider setting up a Health Savings Account (HSA). If you need a new way to reduce taxes while you put money away, an HSA may be just the thing for you.

Insurance Information

These high-deductible health insurance plans coupled with IRA-style savings accounts are really pretty easy to understand, offer a number of benefits and are becoming more popular.

What is an HSA? HSAs were developed to maximize your savings on health insurance while providing a valuable tax break. The two parts of an HSA program are an eligible, high-deductible health plan and a tax-advantaged savings account. For an individual, an HSA-eligible health insurance plan must have an annual deductible of at least $1,050 for individuals and $2,100 for families.

Insurance Tips

The second part of an HSA program is an IRA-style savings account that allows you to reduce your taxable income by building savings. You can deposit funds up to the total of your health plan’s deductible into the HSA each year. So, within certain regulatory limits, the higher your health plan’s deductible, the more you can tuck away tax-free.

How does the Tax Savings work? If you make $40,000 a year and you put $2,000 in your HSA, you’ll only pay taxes on $38,000. Like an IRA, the HSA is meant to encourage you to save for retirement. Funds placed into your HSA can be invested and the balance will roll over each year into retirement.

You can use your HSA funds to cover medical expenses such as over-the-counter drugs, eyeglasses, co-payments and any medical costs incurred before your annual deductible is met.

WASHINGTON – Better beat the crowd and find a doctor.

Primary care physicians already are in short supply in parts of the country, and the landmark health overhaul that will bring them millions more newly insured patients in the next few years promises extra strain.

The new law goes beyond offering coverage to the uninsured, with steps to improve the quality of care for the average person and help keep us well instead of today’s seek-care-after-you’re-sick culture. To benefit, you’ll need a regular health provider.

Yet recently published reports predict a shortfall of roughly 40,000 primary care doctors over the next decade, a field losing out to the better pay, better hours and higher profile of many other specialties. Provisions in the new law aim to start reversing that tide, from bonus payments for certain physicians to expanded community health centers that will pick up some of the slack.

A growing movement to change how primary care is practiced may do more to help with the influx. Instead of the traditional 10-minutes-with-the-doc-style office, a “medical home” would enhance access with a doctor-led team of nurses, physician assistants and disease educators working together; these teams could see more people while giving extra attention to those who need it most.

“A lot of things can be done in the team fashion where you don’t need the patient to see the physician every three months,” says Dr. Sam Jones of Fairfax Family Practice Centers, a large Virginia group of 10 primary care offices outside the nation’s capital that is morphing into this medical home model.

“We think it’s the right thing to do. We were going to do this regardless of what happens with health care reform,” adds Jones. His office, in affiliation with Virginia Commonwealth University, also provides hands-on residency training to beginning doctors in this kind of care.

Only 30 percent of U.S. doctors practice primary care. The government says 65 million people live in areas designated as having a shortage of primary care physicians, places already in need of more than 16,600 additional providers to fill the gaps. Among other steps, the new law provides a 10 percent bonus from Medicare for primary care doctors serving in those areas.

Massachusetts offers a snapshot of how giving more people insurance naturally drives demand. The Massachusetts Medical Society last fall reported just over half of internists and 40 percent of family and general practitioners weren’t accepting new patients, an increase in recent years as the state implemented nearly universal coverage.

Nationally, the big surge for primary care won’t start until 2014, when the bulk of the 32 million uninsured starts coming online.

Sooner will come some catch-up demand, as group health plans and Medicare end co-payments for important preventive care measures such as colon cancer screenings or cholesterol checks. Even the insured increasingly put off such steps as the economy worsened, meaning doctors may see a blip in diagnoses as those people return, says Dr. Lori Heim, president of the American Academy of Family Physicians.

That’s one of the first steps in the new law’s emphasis on wellness care over sickness care, with policies that encourage trying programs like the “patient-centered medical home” that Jones’ practice is putting in place in suburban Virginia.

It’s not easy to switch from the reactive — “George, it’s your first visit to check your diabetes in two years!” — to the proactive approach of getting George in on time.

First Jones’ practice adopted an electronic medical record, to keep patients’ information up to date and help them coordinate necessary specialist visits while decreasing redundancies.

Then came a patient registry so the team can start tracking who needs what testing or follow-up and make sure patients get it on time.

Rolling out next is a custom Web-based service named My Preventive Care that lets the practice’s patients link to their electronic medical record, answer some lifestyle and risk questions, and receive an individually tailored list of wellness steps to consider.

Say Don’s cholesterol test, scheduled after his yearly checkup, came back borderline high. That new lab result will show up, with discussion of diet, exercise and medication options to lower it in light of his other risk factors. He might try some on his own, or call up the doctor — who also gets an electronic copy — for a more in-depth discussion.

“It prevents things from falling through the cracks,” says Dr. Alex Krist, a Fairfax Family Practice physician and VCU associate professor who designed and tested the computer program with a $1.2 million federal grant. In a small study of test-users, preventive services such as cancer screenings and cholesterol checks increased between 3 percent and 12 percent.

Pilot tests of medical homes, through the American Academy of Family Physicians and Medicare, are under way around the country. Initial results suggest they can improve quality, but it’s not clear if they save money.

Primary care can’t do it alone. Broader changes are needed to decrease the financial incentives that spur too much specialist-driven care, says Dr. David Goodman of the Dartmouth Institute for Health Policy and Clinical Practice.

“What we need is not just a medical home, but a medical neighborhood.”

WASHINGTON – With tempers flaring, President Barack Obama and congressional Republicans clashed in an extraordinary live-on-TV summit Thursday over the right prescription for the nation’s broken health care system, talking of agreement but holding to long-entrenched positions that leave them far apart.

“We have a very difficult gap to bridge here,” said Rep. Eric Cantor, the No. 2 House Republican. “We just can’t afford this. That’s the ultimate problem.”

With Cantor sitting in front of a giant stack of nearly 2,400 pages representing the Democrats’ Senate-passed bill, Obama said cost is a legitimate question, but he took Cantor and other Republicans to task for using political shorthand and props “that prevent us from having a conversation.”

And so it went, hour after hour at Blair House, just across Pennsylvania Avenue from the White House — a marathon policy debate available from start to finish to a divided public.

The more than six-hour back-and-forth was essentially a condensed, one-day version of the entire past year of debate over the nation’s health care crisis, with all its heat, complexity and detail, and a crash course in the partisan divide, in which Democrats seek the kind of broad remake that has eluded leaders for half a century and Republicans favor much more modest changes. With Democrats in control of the White House and Congress, they were left with the critical decision about where to go next.

Obama and his Democratic allies argued at Thursday’s meeting that a broad overhaul is imperative for the nation’s future economic vitality. The president cast health care as “one of the biggest drags on our economy,” tying his top domestic priority to an issue that’s even more pressing to many Americans.

“This is the last chance, as far as I’m concerned,” Rep. Louise Slaughter, D-N.Y.

Obama lamented partisan bickering that has resulted in a stalemate over legislation to extend coverage to more than 30 million people who are now uninsured. “Politics I think ended up trumping practical common sense,” he said.

And yet, even as he pleaded for cooperation — “actually a discussion, and not just us trading talking points” — he insisted on a number of Democratic points and acknowledged agreement may not be possible. “I don’t know that those gaps can be bridged,” Obama said.

With hardened positions well staked out before the meeting, the president and his Democratic allies prepared to move on alone — a gamble with political risks no matter how they do that.

One option — preferred by the White House and progressives in the Democratic caucus — is to try to pass a comprehensive plan without GOP support, by using controversial Senate budget reconciliation rules that would disallow filibusters. GOP Sen. Lamar Alexander asked Democrats to swear off a jam-it-through approach, while Senate Majority Leader Harry Reid, D-Nev., defended it. Obama weighed in with gentle chiding, asking both sides to focus on substance and worry about process later — a plea he made repeatedly throughout the day with little success.

A USA Today/Gallup survey released Thursday found Americans tilt 49-42 against Democrats forging ahead by themselves without any GOP support. Opposition was even stronger to the idea of Senate Democrats using the special budget rules, with 52 percent opposed and 39 percent in favor.

A second alternative for Obama and his party is going smaller, with a modest bill that would merely smooth some of the rough edges from the current system. A month after the Massachusetts election that cost Democrats their Senate supermajority and threw the health legislation in doubt, the White House has developed its own slimmed-down health care proposal so the president will know what the impact would be if he chooses that route, according to a Democratic official familiar with the discussions. That official could not provide details, but Democrats have looked at approaches including expanding Medicaid and allowing children to stay on their parents’ health plans until around age 26.

Obama himself hinted at a Democrats-only strategy. When asked by reporters as he walked to the summit site if he had a Plan B, he responded: “I’ve always got plans.”

Many lawmakers and Obama stressed areas of agreement, including items such as allowing parents to keep young adult children on their health plans into their 20s, cutting fraud and waste and ensuring that sick people aren’t dropped by insurance companies. But such items occupy the edges of reform.

Indeed, any skepticism about reaching broad consensus was vindicated as soon as the first Republican spoke — in opposition to the mammoth bills that have passed the House and Senate. Alexander, of Tennessee, said Congress and the administration should start over and take small steps, including medical malpractice reform, high-risk insurance pools, a way to allow Americans to shop out of state for lower-cost plans and an expansion of health savings accounts.

“We believe we have a better idea,” Alexander said. “Our views represent the views of a great number of American people.”

Disagreements were not always expressed diplomatically.

Alexander challenged Obama’s claim that insurance premiums would fall under the Democratic legislation. “You’re wrong,” he said. Responded Obama: “I’m pretty certain I’m not wrong.”

As with much in the complicated health care debate, both sides had a point. The Congressional Budget Office says average premiums for people buying insurance individually would be 10 to 13 percent higher in 2016 under the Senate legislation, as Alexander said. But the policies would cover more medical services, and around half of people could get government subsidies to defray the extra costs.

Obama and his 2008 GOP opponent for the presidency, Sen. John McCain of Arizona, had a barbed exchange. McCain complained at length about what he said was a backdoor process to produce the original bills that resulted in favors for special interests and carve-outs for certain states.

“We’re not campaigning anymore. The election’s over,” responded a clearly irritated Obama.

“I’m reminded of that every day,” McCain shot back, adding that “the American people care about what we did and how we did it.”

Said Obama: “We can have a debate about process or we can have a debate about how we’re actually going to help the American people at this point. And I think that’s — the latter debate is the one that they care about a little bit more.”

Generally, polls show Americans want solutions to the problems of high medical costs, eroding access to coverage and uneven quality. But they are split over the Democrats’ sweeping legislation, with its $1 trillion, 10-year price tag and many complex provisions, including some that wouldn’t take effect for eight years.

The Democratic bills would require most Americans to get health insurance, while providing subsidies for many in the form of a new tax credit. The Democrats would set up a competitive insurance market for small businesses and people buying coverage on their own. Democrats also would make a host of other changes, which include addressing a coverage gap in the Medicare prescription benefit and setting up a new long-term-care insurance program. Their plan would be paid for through a mix of Medicare cuts and tax increases.

“Not only are lawmakers polarized, the parties’ constituencies are far apart,” said Robert Blendon, a Harvard University professor who follows public opinion trends on health care. “The president is going to use it as a launching pad for what will be the last effort to get a big bill passed. He will say that he tried to get a bipartisan compromise and it wasn’t possible.”

The Blair House setting wasn’t grand, or even particularly comfortable. About 40 senators, representatives and administration officials were crowded shoulder-to-shoulder around a hollow square table, perched for the six-hour marathon on wooden chairs with thin cushions. Coffee breaks were ruled out, so the only pause in the action came during lunch.

C-SPAN carried complete coverage, while news operations from cable networks to public broadcasting were making it the focus of their day.

Leaving the site during a lunch break, Obama was asked by waiting reporters if he thought the debate was engendering a lot of interest across the country.

“I don’t know if it’s interesting watching it on TV,” he responded.

___

Associated Press writers Erica Werner, Ben Feller and Natasha Metzler contributed to this story.

Posted: February 2, 2010

In his State of the Union address, President Obama vowed not to “walk away” from healthcare reform, though he was clearly chastened by the upset in Massachusetts that had swept Republican Scott Brown into the Senate, depriving Obama, at the 11th hour, of a signed bill before the speech. The legislation barely made it through each chamber, and the 60-vote victory on Christmas Eve in the Senate came without a vote to spare. The president did not reveal how he would move forward, but his rescue options are sorely limited. Still, whatever path he chooses, the walk provides a totally unexpected opportunity for the country: the chance to go back and make changes that would not have been possible before Massachusetts voters weighed in.

There are really only two paths forward, and both will take time. In the faster (and perhaps too clever) way, the House would pass the Senate bill untouched and send it to the president, bypassing the need for a final Senate vote that includes Brown. Secret negotiations are underway at both ends of Pennsylvania Avenue to modify the 2,700-page Senate monster to the House’s liking—but any changes can be voted on only after the president signs the bill into law. The post-facto recasting would use a political gimmick, a process called reconciliation, that applies to budget issues and requires a simple majority vote (51 percent) rather than the supermajority (60 percent) often needed to pass controversial legislation in the Senate. If the House balks at this feat of legislative engineering, Congress will have to take a deep breath, step back, and fashion a more bipartisan bill.

Both scenarios mean that healthcare reform could still be made far more respectful of patients’ individual choices and their pocketbooks—not just the federal purse. Let me suggest two big-ticket areas that badly need attention: prescription drug costs and insurance premiums. Both must be affordable, or a central goal of reform—ready healthcare for all—will never be achieved.

Pharmaceuticals: In the United States, medicines in exactly the same doses commonly run three to four times, and in some cases 10 times, prices in other places on the planet with drug-safety and approval systems like our own. The issue became hot in 2003, when older folks were caught boarding buses to Canada to buy their drugs at huge discounts. Rather than being cheered on by Uncle Sam for saving healthcare dollars, the renegades were threatened with confiscation of their “illegal” purchases. The federal government refused to relax the Food and Drug Administration’s rules against citizens’ importing drugs, even those obtained from perfectly legitimate pharmacies. And the consumers’ revolt was vigorously opposed—surprise, surprise—by the drug companies, which lobbied heavily to continue to soak American taxpayers under the guise of safety. A bill to allow such drug imports, cosponsored by none other than Barack Obama when he was in the Senate, was roundly defeated.

 Shortly after he was inaugurated, Obama vowed to bring down the cost of drugs by making it possible for Americans to fill prescriptions outside the country. It did not take long, however, for the special interests to entice him to cave. In a stunning surprise, given his legislative record and earlier promises, Obama made a backroom deal with the pharmaceutical lobby. Big Pharma would support Obamacare and even contribute $80 billion to the healthcare reform effort. The president would quash efforts in support of the citizen revolt.

Then, in mid-December, in one of the few bipartisan moves related to health reform, a majority of senators voted to amend the bill to allow Americans to buy drugs from Canada, Europe, Australia, New Zealand, and Japan. How could they not do so? The Congressional Budget Office had just estimated that the amendment would save the government almost $20 billion, and Democratic Sen. Byron Dorgan of North Dakota, who sponsored the bill, said it would lower patients’ costs by $80 billion. The amendment did not get the 60 votes necessary to be added to the health reform bill, but a reconciliation strategy that needs only 51 votes, or a new bill fashioned from scratch, could and should get the gray panthers a win after all. Health reformers ought to place value on healthy competition, which, if allowed to flourish, can lower costs to individuals as well as to the U.S. Treasury.

Insurance reform: In the same spirit of allowing competition and consumer choice to thrive, the way health insurance is sold should be addressed. The current system bears no resemblance to an open market where people can shop for the best policy for themselves and their families at the best price, as they can, say, for car insurance. Now, patients have little leverage. Those with health risks can be rejected out of hand, existing coverage can be canceled, and claims can be denied for little or no reason. Outlawing such abuses is the one part of the current healthcare reform legislation that has strong bipartisan support. And this is an imperative that cannot be walked away from.

But even then, a nagging problem remains: People don’t feel insurers are working for them, although the companies manage lots of their money and weigh in on their health. This could get worse, since a keystone of health reform—the individual mandate—would force people to buy coverage restricted to that sold through either a government-run exchange or an employer. Only the federal government would define the “essential” coverage every American must have and would set up the rules of the exchange.

Instead, to preserve patient choice while trimming cost, we need multiple nationwide exchanges, public and private, that will foster competition among insurers, expand choices, and lower prices by helping patients to be smart consumers. Rather than being forced to buy a one-size-fits-all, comprehensive, government-approved policy, for example, most young people could get insurance for thousands of dollars less by choosing a scaled-back, high-deductible cata­strophic plan that brings access to discounted ­prices for preventive and primary care.

Face it: Since most of the uninsured fall into the relatively healthy under-40 group, the current bills will force tens of millions of Americans to overpay for coverage, a juicy deal for insurers but not for anyone else. A bonus to allowing high-deductible plans is that they force people to think about the cost of their care and, much as those elders did when they boarded buses to cross the border to get cheaper drugs, to search for ways to save. We cannot ignore the power of the people to make their own wise decisions. Let’s give them an incentive to do so, and we’ll develop a generation of prudent healthcare consumers. 

By JOSEPH BROWNSTEIN
ABC News Medical Unit
Jan. 21, 2010—

With Republican Scott Brown’s victory in Massachusetts on Tuesday, Republicans in the Senate captured a seat long held by Democrats, and, perhaps more importantly, the possible 41st vote necessary to filibuster any new health care bill.

But while the future of a health care overhaul remains unclear, experts are divided as to how to read the tea leaves in public opinion on the issue following a vote from a state that already has universal health care. Brown, then a state senator, voted in favor of the measure when the Massachusetts legislature passed it in 2006.

Brown has vowed to halt the current version of health care reform, passed by the Senate on Dec. 24, saying he did not think the current plan was a good one for the country — or Massachusetts.

“We already have 98 percent of our people insured here,” Brown said Wednesday afternoon, repeating one of his campaign themes. “We know what we need to do to fix it. But to have the one-size-fits-all plan that is being pushed nationally — it doesn’t work.”

Experts were split on whether health care overhaul could continue forward at this point.

“President Obama’s already unpopular health plan didn’t lose just one vote in the Senate. It lost maybe a handful of votes in the Senate and perhaps a dozen or more in the House,” said Michael Cannon, director of health policy studies at the Cato Institute.

“Antipathy toward the Obama plan was the number one reason for Brown’s victory, and that has vulnerable Democrats in Congress running scared,” he said. “They are now far more likely to vote against the Obama plan, particularly since the elections in New Jersey and Massachusetts show that Obama can’t help them on the campaign trail.”

But others disagree.

“Health reform is not doomed. It just depends who does it,” said Uwe Reinhardt, a professor of economics and public affairs at Princeton University. “The task will always be much, much more difficult for Democrats, because they are suspected of plotting government hegemony just breathing. It is much simpler for Republicans to do the same thing.”
State of Opposition
To be sure, nationwide numbers have shown the public to be divided on the issue, with a slight majority opposed to the measure.

But it remains unclear how those numbers translate to Massachusetts, traditionally one of the most Democratic-leaning states in the union, but one that has some unusual circumstances when it comes to health care overhaul.

During his campaign, Brown said the health-care bill passed by the Senate would force Massachusetts to subsidize care in other states.

“It is a good point that Massachusetts residents didn’t ‘need’ national reform,” said David Dranove, a professor of health industry management at the Kellogg School of Management at Northwestern University. “But they must have been furious about having to pay for healthcare in Nebraska and Louisiana on top of paying for their own healthcare.”

He also noted that Massachusetts voters “could see that the national reform effort was a badly compromised version of their own reforms,” noting that Democrats in Congress struck some deals that he feels voters found unpalatable.

But some also noted the fact that Massachusetts has had some level of health care reform may be a sign that voters did not cast their votes based on that issue — and perhaps politicians shouldn’t interpret it to mean that.

“I do find it ironic that many people outside of Massachusetts are interpreting this vote as a message that those living in the state oppose health care reform, when a very similar system is very popular inside that state,” said Dr. Aaron Carroll, director of the center for health policy and professionalism research at the Indiana University School of Medicine. “If they were truly opposed, you should have seen at least one campaign running on a platform of scrapping their system. None did.”
Second Life Or Dead On Arrival?
While some may see health care overhaul as a lost opportunity, others see the vote as a setback that can be overcome.

Reinhardt noted that in the past, Republican administrations have pushed bills through Congress that brought price controls set by the federal government. Under Ronald Reagan the target was the hospital sector, and under George H.W. Bush it was doctors.

“Both times it went without a huge public outcry. But now imagine if a Democratic president — e.g., Bill Clinton or Obama — had done the same thing. He would swiftly be denounced as trying to impose Soviet-style pricing on American hospitals which, in effect Reagan’s [pricing systems] were,” he said.

“Moral of the story: There is a double standard here,” Reinhardt said. “Perhaps only Republicans can get health reform done, because only they can get away with doing even Soviet-style policies.”

Other ideas for a bill passage have been floated.

Some proponents of health reform have held out hope of persuading Maine Sen. Olympia Snowe, a Republican, to vote for a bill, and others wanted to speed through health care reform before Brown was seated, although Obama has nixed that idea.

“Here is one thing I know, and I just want to make sure this is off the table,” he told ABC News’ George Stephanopoulos on Wednesday. “The senate certainly shouldn’t try to jam anything through until Scott Brown is seated. People in Massachusetts spoke. He’s got to be part of that process.”

Leadership Unclear
Even Democrats in the Senate do not appear to have a clear plan for how to proceed right now.

In response to a question from ABC News correspondent Jonathan Karl about whether he was committed to finishing the health care bill and confident he could pass it on to the president, Senate Majority Leader Harry Reid replied, “I am confident that health care is an issue in this country. We are going to do everything we can to alleviate the pain and suffering of people who cannot afford health care and who want to maintain what they have.”

He then noted that the House had until Dec. 24, 2010 to pass the bill the Senate had passed at the end of last year and send it to the President.

His representative clarified afterward.

“We are still committed to getting health care done,” Reid spokesman Jim Manley said.

But Brown himself has given some hints that even if the current incarnation of health care reform is not something he will vote for, it does not mean he will oppose any proposal.

“I think it’s important for everyone to get some kind of health care,” he said Wednesday. “It’s just a question of whether we’re going to raise taxes, cut a trillion from Medicare, we’re going affect veterans’ care — I think we can do it better.”

ABC News’ Political Unit in Washington contributed reporting. The ABC News Medical Unit is based in Needham, Mass.

(CNN) — Faced with the once-unthinkable prospect of losing the Massachusetts Senate race, Democratic officials on Capitol Hill are quietly talking about options for passing health care reform without that critical 60th Senate vote.

Top White House aides insist they are not engaging in any talk of contingency plans, because they believe Democrat Martha Coakley will beat Republican Scott Brown in Tuesday’s crucial Senate battle.

“We are not having any discussions like that,” White House spokesman Bill Burton told CNN. “We believe she is going to win.”

Asked about potential contingency plans as Air Force One returned to the Washington area after President Obama’s Sunday campaign rally for Coakley in Boston, White House Press Secretary Robert Gibbs insisted to reporters the plan is to still pass health care reform with 60 votes. “We think Coakley will win this race,” Gibbs said.

But Democratic sources on Capitol Hill say “what-if” discussions are taking place about how they could proceed with health care if Coakley is defeated, and they privately admit none of their alternatives is very good. According to senior Democratic congressional officials, here are options under discussion:

Pass health care reform before Scott Brown is seated.

But multiple Democratic sources say this is unlikely. Even if House and Senate Democrats could reach a deal to meld their bills and pass them in the next couple of weeks — a big if — there would be a huge outcry from not only Republicans, but also an increasingly distrustful public.

For that reason, one senior Democratic source says some Democratic lawmakers who voted yes last time have already warned they would vote no if health care is voted on in advance of any swearing in of Brown.

The House passes the Senate health care bill.

Democratic sources also call this extremely unlikely, because House Speaker Nancy Pelosi likely wouldn’t have the votes to pass it. Many House Democrats have major differences with several provisions in the Senate bill, especially the way the Senate structured a tax on high-cost insurance plans.

Revisit the idea of trying to push health care through the Senate with only 51 votes, a simple majority.

But to do that, Democrats would have to use a process known as reconciliation, which presents technical and procedural issues that would delay the process for a long time, and Democrats are eager to put the health care debate behind them and move onto economic issues such as job creation as soon as possible this election year.

Try once again to get moderate Maine Republican Olympia Snowe’s vote. They could try for a compromise health reform plan with the independent-minded Republican, but multiple Democratic sources say they believe that is unlikely now.

Their health care overhaul dies.

Although some Democrats are not ruling out this possibility, numerous top Democrats say not passing a health care bill for the president to sign is unthinkable after he put so much political capital into passing a reform bill, and congressional Democrats spent much of last year working on it.

Democrats are in an all-out push to pass health care reform that will likely keep the Senate in session non-stop — 24-hours-a-day — between now and Christmas eve.

They are doing this because they think they can pass the bill now and don’t want to risk losing momentum when Congress goes on recess.   The only remaining hold-out is Ben Nelson, however, and if he does not come on board, not even Senate all-nighters can get it done.

To pass the bill, it will take a total of four separate votes, each requiring 30 hours of debate.  And first the Senate must pass the Defense appropriations bill (which requires two votes).

Here’s the current plan:

-    Votes on Defense appropriations at 1am tonight and 7am Saturday. 

-    Saturday morning, Reid introduces his compromise deal – aka “manager’s amendment” – and moves to cut off debate.

-    Republicans likely force a reading of the Reid amendment.  I’m told it’s 500 pages. 

-     The first health care vote – to cut-off debate on Reid’s amendment  – happens as early as  Sunday night after 1am.

-     The 2nd health care vote would come 30 hours later or sometime after 7am Tuesday.

-    30 hours after that, the 3rd vote, possibly by Wednesday afternoon, December 23.

-    Republicans could insist on another 30 hours of debate, which would lead to final vote Christmas eve.

Despite this mad dash to pass a bill by Christmas, Harry Reid still hasn’t released his compromise bill or an estimate of how much it will cost.  I am told we are likely not to see either until tomorrow.

And remember … this bill still needs to be reconciled with the one passed in the House … and that reconciled bill then needs to be passed again in both chambers.   A final bill by the New Year?  Don’t hold your breath.

The AARP, the nation’s largest organization of older Americans, is a nonpartisan group that advocates for people 50 and older. The AMA, historically an opponent of health care reform, is considered one the nation’s most influential doctors’ advocacy groups.

“I want to thank both organizations again for their support, and I urge Congress to listen to AARP, listen to the AMA and pass this reform for hundreds of millions of Americans who will benefit from it,” President Obama said at the White House.

The backing of those two groups comes as House Speaker Nancy Pelosi, D-California, oversees final changes to the $1.1 trillion health care bill. The measure likely will come to a final vote Saturday.

A 42-page manager’s amendment on the health care legislation posted Tuesday night made mostly technical changes in the nearly 2,000-page bill compiled from three Democratic proposals passed by three House committees.

By making the changes public Tuesday, House Democratic leaders could open floor debate on the bill Friday, while fulfilling their pledge to allow 72 hours of review before bringing the measure to the full chamber.

Pelosi insisted Thursday she will have the 218 votes necessary to pass the bill. Meanwhile, President Obama is set to huddle Friday with congressional Democrats on Capitol Hill to review the legislation.

In a statement, AARP CEO Barry Rand said, “We started this debate more than two years ago with the twin goals of making coverage affordable to our younger members and protecting Medicare for seniors.

“We can say with confidence that [the House bill] meets those goals with improved benefits for people in Medicare and needed health insurance market reforms to help ensure every American can purchase affordable health coverage.”

The AMA’s president, Dr. J. James Rohack, told reporters Thursday that the legislation is “not a perfect representation of our views” but is close enough to warrant his group’s support and keep the reform process moving forward.

Rohack said the bill needs to be accompanied by legislation reversing scheduled Medicare reimbursement payment reductions to physicians.

Responding to the AMA endorsement, Obama said the doctors’ group is “supporting reform because [its members have] seen firsthand what’s broken about our health care system,” Obama said.

“They would not be supporting it if they really believed that it would lead to government bureaucrats making decisions that are best left to doctors.”

Meanwhile, House Republicans on Thursday continued to signal their opposition to the measure. GOP leaders held a rally on Capitol Hill along with “Tea Party” movement protesters and other activists to warn that the House legislation would translate into a full-blown government takeover of the health care system.

Rep. Michele Bachmann, R-Minnesota, told CNN’s “American Morning” on Thursday that Democrats had forgotten the lessons of August’s town hall meetings when angry conservatives criticized health care legislation.

“I think what we’re going to see is the town hall coming to Washington, D.C., just to remind members of Congress [that] we’re the ones we would like you to pay attention to, not lobbyists. And we don’t want the government to own our health care,” Bachmann said.

Speaking at Thursday’s opposition rally, actor John Ratzenberger, who played Cliff on the sitcom “Cheers,” slammed the Democratic bill as a form of socialism.

“These are Woodstock Democrats,” Ratzenberger said. “We have to remember where their philosophy comes. It doesn’t come from America. It comes from overseas. It comes from socialism. And socialism is a philosophy of failure.”

House Democrats have rejected an alternative $60 billion Republican plan as inadequate for meeting the goals of expanding health coverage to most of the nation’s 46 million uninsured while bringing down costs and ending controversial industry practices such as denying coverage for pre-existing conditions.

Pelosi’s bill would extend insurance coverage to 36 million uncovered Americans and guarantee that 96 percent of Americans have coverage, according to the Democratic leadership.

The claim is based on an analysis by the nonpartisan Congressional Budget Office.

Among other things, the bill would subsidize insurance for poorer Americans and create health insurance exchanges to make it easier for small groups and individuals to purchase coverage. It also would cap annual out-of-pocket expenses and prevent insurance companies from denying coverage for pre-existing conditions.

Pelosi’s office has said the bill would cut the federal deficit by roughly $30 billion over the next decade. The measure is financed through a combination of a tax surcharge on wealthy Americans and spending constraints in Medicare and Medicaid.

Specifically, individuals with annual incomes more than $500,000 — as well as families earning more than $1 million — would face a 5.4 percent income tax surcharge. Growth in Medicare expenditures would be cut by 1.3 percent annually.

The House bill also includes a government-run public option. Under the House plan, health care providers would be allowed to negotiate reimbursement rates with the federal government. Pelosi and other liberal Democrats had argued for a more “robust” public option that would tie reimbursement rates for providers and hospitals to Medicare rates plus a 5 percent increase. Several Democrats representing rural areas, however, killed the proposal after complaining that doctors and hospitals in their districts would be shortchanged under such a formula.

One thorny issue yet to be resolved among House Democrats is the bill’s final language on abortion. Rep. Bart Stupak, D-Michigan, has been pushing leaders to add stronger language prohibiting the use of federal money to pay for abortions under the health care overhaul.

Stupak has vowed that if he isn’t allowed a vote on the issue, a group of 40 anti-abortion Democrats will work to block the bill from getting to the House floor.

The House bill differs from legislation the Senate is considering in a number of critical ways. Senate Majority Leader Harry Reid, D-Nevada, also favors a public option but would allow individual states to opt out of the plan.

An $829 billion bill recently passed by the Senate Finance Committee does not include a tax surcharge on the wealthy but would impose a new tax on high-end health care policies, which critics have dubbed “Cadillac” plans. A large number of House Democrats are opposed to taxing those policies, arguing that such a move would hurt union members who traded higher salaries for more generous benefits.

Individuals under the $829 billion Finance Committee plan would be required to purchase health insurance coverage or face a fine of up to $750. The House bill imposes a more stringent fine of up to 2.5 percent of an individual’s income. Both versions include a hardship exemption for poorer Americans.

The Finance Committee bill would require large companies to contribute to the health care costs of lower income workers if those workers received a government subsidy for insurance. The House legislation would require larger companies to provide employee insurance for everyone or pay a penalty of up to 8 percent of total revenue.

Democratic leaders in both chambers agree on establishing nonprofit health care cooperatives and stripping insurance companies of an anti-trust exemption that has been in place since the end of World War II.

Reid refused earlier this week to predict when the chamber would pass a health care bill, possibly signaling difficulty in generating support from his entire Democratic caucus.

CNN’s Dana Bash, Lisa Desjardins and Deirdre Walsh contributed to this report.

WASHINGTON – For Democrats determined to get a health care bill, Sen. Roland Burris is like the house guest who couldn’t be refused, won’t soon be leaving and poses a plausible threat of ruining holiday dinner.

Suddenly, he can no longer be ignored.

The Illinois Democrat, appointed by disgraced former Gov. Rod Blagojevich, says he’ll only vote for a bill to provide health care to millions more Americans as long as it allows the government to sell insurance in competition with private insurers.

And he says he won’t compromise.

“I would not support a bill that does not have a public option,” Burris, 72, said in a recent interview with The Associated Press. “That position will not change.”

Those words caught the attention of the very Democratic leaders who tried to keep Burris out of the Senate, suggested he resign and have shunned him in unprecedented fashion. Burris is not the only Democrat to insist on creation of a government-run health plan. But he is the one who has the least to lose by defying President Barack Obama and the Democrats who once turned him out in the cold rain.

It was early January and Blagojevich had appointed Burris, a former Illinois attorney general, to Obama’s former Senate seat — defying Democrats in Washington who had wanted someone without a tainted patron and with a better chance of winning election in 2010.

What happened next was a procession of ugly images, from Burris’ rain-swept news conference after Democrats turned him away from a swearing-in to Illinois Rep. Bobby Rush daring Democrats to block an accomplished lawyer who would be the chamber’s only black.

Bitterly, the Democrats seated Burris. But when it came out that Burris had admitted what he had denied under oath — that he’d unsuccessfully tried to raise money for Blagojevich — Majority Whip Richard Durbin, D-Ill., suggested that Burris resign. He refused.

A Senate ethics committee probe is pending into Burris’ statements. Democratic leaders, meanwhile, refused to support any effort by Burris to seek a full term, and he will leave the Senate in 2011.

Meanwhile, his relationship with the rest of his caucus has settled into one of mutual, if chilly, benefit.

It works this way: Burris stays mum about any bitterness he may feel about his reception, and he gets Obama’s Senate seat for two years. Democrats seat him, don’t speak of him and can count on his loyal vote at a time when all 58 Democrats and two independents must vote together to prevent Republican filibusters.

They’ve never needed 60 votes like they do on the yet-to-be-finalized health care bill. A disciplined grin shows that Burris knows it.

No, he says, he will not vote for any version of a government-run plan circulating in the Senate, other than the full-blown one from the Senate Health, Education, Labor and Pensions Committee.

He won’t vote, for example, for Republican Sen. Olympia Snowe’s idea to use the threat of a public option to force insurers to lower premiums by certain deadlines. He hasn’t seen the details of another idea, proposed by Sen. Tom Carper, D-Del., that would allow each state to decide whether to offer public coverage to compete with private insurers. The health committee’s proposal, he says, must be in the final bill to earn his vote.

“Yeah, that’s the one,” Burris said.

By definition, all 100 senators are relevant because any one can block Senate business unless there are 60 votes to override the objection. But Burris’ stated position on the public option means that Democrats can no longer take his vote for granted.

It’s too early to tell whether the public option, or some version of it, ends up in the final compromise between a committee of House and Senate lawmakers. First, each chamber must pass its version of a health care bill. House Democrats are insisting on the government-run plan; but in the Senate, the public option is less popular in both parties.

Every Democratic vote is important. And yet, Democratic leaders aren’t talking about Burris.

Instead, they’re talking confidently about having the votes for the biggest policy overhaul in a generation, a signature issue for Obama and the Democratic Party.

Finance Committee Chairman Max Baucus, D-Mont., said Burris’ demand alone makes him no different than other senators seeking this or that in the bill.

“I will do what I can to address the thises and thats,” Baucus said. “But my strong feeling is in the end, the need for health care reform is to get 60 votes (and) is going to trump the concerns that some might have.”

For his part, Burris says he’s just representing the wishes of his state. And he’s relentlessly loyal to the arrangement. His only acknowledgment of being treated differently than others is a reference to the “distractions” that marked his first weeks in office.

Ask him whether he feels badly treated by the leaders, and he’ll answer with a question:

“By whose standard?”

Go a couple more rounds, and he’ll elaborate, generally.

“I feel that I’ve had great opportunities here,” Burris said. “I feel like anytime I had a question that needed answered, anytime I needed something, there was certainly assistance there.”

Does he feel respected and listened-to? Burris pauses and looks puzzled.

“Yes. I’m a senator from Illinois representing 13 million people. I’m one of 100, and I speak on the floor, I preside over the Senate, I co-sponsor legislation,” he says. “I’m very busy, I’m very challenged, and I have one problem.”

He grins.

“I enjoy what I’m doing.”

It is complicated. Listening to a singular pundit or TV channel for news about health care reform may only provide talking points, and attempting to put together the entire debate and its current status leaves most people confused and frustrated. The ins and outs of health care reform are undoubtedly complicated, especially as hundreds of pages of legislation filled with political-speak will likely dictate the future of health care in America. But the issues at stake are rather simple, and though the debates rage on, a basic understanding of the core of health care reform is necessary for the public to stay aware and involved in the process.

Health care reform became an issue partially because the public demanded it. Not only are there more than 46 million Americans currently without any type of health insurance, another 25 million people are underinsured. And recent economic woes have sent hundreds of thousands more into the category of uninsured as unemployment numbers rise. Another contributing factor to the underinsured and uninsured is medical costs that continue to rise; Health Affairs reported that $2.4 trillion was spent in 2007, which is 52 percent more than any other nation in the world. Add to those numbers the fact that of the 1.5 million Americans that are likely to declare bankruptcy in 2009, more than 60 percent of them result from medical bills, per a 2009 study by the American Journal of Medicine. Thus, the need for action increases by leaps and bounds.

When President Barack Obama campaigned for the office he currently holds, he spoke of the need for health care reform on a consistent basis. And just over one month after taking the oath of office, he reiterated his focus on the health care crisis that “cannot wait.” By June of 2009, he brought the issue to Congress as a must-do item on the agenda, and he urged the idea of a government-sponsored health insurance plan, similar to Medicare and now known as the “public option,” to compete with the private insurance companies now dominating the market, along with the mandatory removal of preexisting conditions as a reason for refusal of any health care.

While some Democrats in Congress embraced the plan, others were skeptical of implementing a public option, and Republicans blatantly rejected the idea, fearing low quality care and the strain that might cause private insurance companies to be put out of business. The debates then began in the hall of Congress but quickly disintegrated to divisive jabs when erroneous information spread that illegal immigrants would be covered under the public option, that death panels would be instituted to rid society of some of its sick or elderly members, and that people would not be able to keep their current insurance coverage if they chose to do so. Some of the public became fearful that the public option would create a socialist form of medical care in the United States, and many in Congress fell in line with those fears, standing back from support of any drastic changes to the current system.

Another stumbling block for potential agreement on the issue of reform is the ability of the government to find ways to pay for it. Numerous ideas have been introduced, including cutting excess from Medicare, and while those continue to be debated, the general consensus remains that any health care reform package should provide a viable alternative to increasing the U.S. government’s current deficit.

It should also be noted that a great majority of the members of Congress have or continue to accept large campaign donations from private insurance companies and their executives, making it more difficult to stand for changes that those companies staunchly oppose. Senators and Representatives who have chosen to support drastic health care reform have likely done so at the risk of losing campaign contributions and possibly future elections, if they accepted said monies in the first place.

The latest development in the ongoing saga of Congress’ attempt to address health care reform involves a bill introduced to the Senate on September 16, 2009, by Senator Max Baucus (D-MT). America’s Healthy Future Act proposes a 10-year overhaul of the health care system that would cost roughly $829 billion, though the Congressional Budget Office’s study revealed it would not only be paid for by taxes on expensive and comprehensive health plans and reductions in Medicare Advantage spending, but it would reduce the deficit by $81 billion over the next decade.

The meat of the bill proposes the creation of health insurance cooperatives (co-ops), which are non-for-profit insurance groups controlled by consumers to compete with private insurance companies. However, this is different from the aforementioned public option in that it would not be regulated by the government (after its initial launch and sponsorship by federal funding). Along with the co-op initiative, the Baucus bill proposes an individual mandate that will require every American to buy some form of insurance or pay a penalty, with those living three times below the poverty level eligible to receive subsidies to aid in their purchases.

Baucus prepared his bill to come before the Senate Finance Committee on October 13 for a vote, but on October 12, a lobby representing a group of insurance companies released a previously-commissioned study by PricewaterhouseCoopers that warned of insurance premiums rising drastically should the Baucus bill eventually be passed into law. It was speculated that the news was released to deter members of the committee from passing the bill, though it seemed to effect none of the votes either way.

The October 13 hearing was held as scheduled, and the Baucus bill passed by a vote of 14 to 9, split directly down the line with Democrats voting for it and Republicans voting against it with one sole exception when Olympia Snowe (R-ME) crossed party lines to cast her vote in favor of the bill.

Where does that leave health care reform?

Many steps remain in the process. Changes to the Baucus bill are inevitable, as it must be combined with the previously-passed Health Committee bill that provided for a public option. Ultimately, the bill that comes before the Senate must win at least 60 votes to pass and avoid the possibility of a Republican filibuster, and Congressional aides estimate that the meetings to merge the bills and finding consensus between House and Senate proposals will require a minimum of several weeks, according to CNN.

Therefore, Americans must wait. While constituents can contact their representatives in Congress to express their opinions, they must then wait as the fate of their health care coverage is debated on Capitol Hill. The goal is to pass some form of health care before the end of the 2009 calendar year, but what kind of reform eventually passes remains to be seen.

Vermont leads the nation in the delivery of its health care, while Mississippi is rated the worst, according to a non-partisan study that compares all 50 states and the District of Columbia.

Vermont, Hawaii, Iowa, Minnesota, Maine and New Hampshire ranked 1 to 5 in 38 indicators of health care.

At the bottom were Mississippi, along with Oklahoma, Louisiana, Arkansas, Nevada and Texas.

The Commonwealth Fund Commission’s “Scorecard on Health System Performance,” which was released today, rated the states on access, quality, costs and health outcomes in a follow up to their 2007 report.

Overall, the states which did best on the Commonwealth scorecard were in New England and the upper Midwest, and the worst states were in the South.

Vermont, with only 640,000 residents, has nearly universal health care coverage with 93 percent insured. Its innovative “Blue Print for Health” focuses on prevention of chronic diseases.

Click Here to Compare Health Care Quality State By State
http://www.commonwealthfund.org/Charts-and-Maps/State-Scorecard-2009.aspx

“We’re small. There are 19 cities larger than the state of Vermont,” said Susan Besio, director for health care reform and Medicaid for Vermont.

“But I believe there is something unique about Vermont in terms of its culture,” she told ABCNews.com. “We want to take care of each other and we are a healthy state.”

In Mississippi, however, about 20 percent are uninsured despite having some of the highest rates of hypertension, diabetes and asthma.

According to the report, only 35.7 percent of adults 50 or over in Mississippi receive recommended screening and preventive care.

“When you compare Mississippi on almost any socio-economic profile, we are a struggling population that has a large percentage of low-income individuals, high unemployment rates, low rate of education,” said Robert Pugh, director of the Mississippi Primary Health Care Association.

The scorecard “paints a picture of health care systems under stress, with deteriorating health insurance coverage for adults and rising health care costs,” according to co-author Cathy Schoen, who is senior vice president of the commission.

“Where you live matters for access, quality of care and whether you live a long and healthy life,” she told ABCNews.com. “These wide and persistent gaps among states highlight the need for national reforms and federal action to support states.”

For example, 32 percent of working-age adults in Texas are uninsured, compared to only 7 percent in Massachusetts in the most recent survey.

“It’s very hard to have a high performing health care system and hospitals that do well for everyone if you have a high rate of uninsured in the state,” said Schoen.

In 1999-00, there were only two states with 23 percent or more of adults uninsured. But by 2007-2008 there were nine.

Children fared much better, due in large part to the Children’s Health Insurance Program (CHIP) under Medicaid. The number of states with 16 percent or more of children uninsured dropped from nine to three during the same time period.

Other findings of the report were that in a, costs rose and quality improved in areas where outcomes were reported to the public.

Vermont’s ‘Blue Print For Health’ A Model
The Green Mountain state was cited for its model “Blue Print” program. Launched by Republican Gov. Jim Douglas, it covers everything from teaching children healthy eating to helping seniors stay in their homes rather than going to costly nursing homes.

“You betcha, I feel good about the reforms we put in place,” Douglas told ABCNews.com. “It’s centered on quality and containing costs. Care shouldn’t start in the emergency room.”

All Vermonters are encouraged to have yearly exams and adults are notified when they are due for check-ups.

Douglas talks to children about “getting off the couch” and set an example just this week by joining elementary students on a walk to school.

With the second oldest population in the nation, Vermont subsizes care for seniors and the disabled to defray the costs of home care. Nursing home beds were reduced by 200 last year.

In one pilot program, electronic medical records can avert expensive tests like MRIs and x-rays. One emergency room doctor seeing a woman with stomach pains discovered in her online medication history that she had not filled her prescription for ulcer medicine.

“It takes time and so a lot of the fruits come from years of work and planning and cooperation,” said Douglas.

Health Care Affects a State’s Economy
But Mississippi, with the highest infant mortality and low birth rates in the nation, makes access to these Medicaid programs more difficult, according to Roy Mitchell, director of the Mississippi Health Advocacy Program (MHAP).

“I am not at all surprised we were 51st on the list,” he told ABCNews.com. “We are last on several health indicators. Our policy makers work hard at being last.”

Despite one of the highest matches of federal to state dollars in Medicaid funding, the state mandates “face-to-face” eligibility, requiring all new applicants and those reapplying for benefits to come in for an interview.

“As a direct result, 65,000 children have fallen off the rolls,” Mitchell said.

“Mississippi does virtually no outreach at all. They don’t publish where these face to face stations are and what times,” he said. “It’s a bureaucratic maze even to find out where to go. And when they get there they don’t have a certain document.”

Of those, about 77 percent would be eligible, he said. “It’s touted as fraud prevention.”

These disparities between the highest and lowest ranked states could be alleviated with national reform, according to Commonwealth.

The report emphasizes the need for insurance reform that rewards good outcomes, payment reform with an emphasis on prevention and advanced information systems that travel with the patient from physician to physician, saving time, money and preventing errors.

“What the scorecard is showing is that we have a system under stress, no matter where we live,” said co-author Schoen. “The costs are rising more than people’s incomes. We need to act.”

Schoen said she has hope for reform. “There is real leadership and people are taking reform seriously.”
Copyright © 2009 ABC News Internet Ventures

As a young man working for Suhrkamp Verlag, the renowned publishing house in Berlin, Michael Prolingheuer bought private health insurance. Coverage was then relatively cheap (though it now costs $905 a month). It also promised greater choice of doctors and easier access to care than Germany’s statutory quasi-public plan, which consists of 187 nonprofit insurers closely supervised, but not run, by the government.

Today, 28 years later, he’s having second thoughts. In January 2007 Prolingheuer, now 54, was diagnosed with amyotrophic lateral sclerosis (also known as Lou Gehrig’s disease), a progressive disease of the nervous system that paralyzes and ultimately kills a patient. Not long after he got the grim news, the fight with his insurer began. At first his carrier, Allianz, balked at paying for the respirator that helps him breathe, arguing it wasn’t specified in his policy. It only relented after a doctor at Berlin’s Charite-Universitaetsmedizin, a teaching hospital, sent a letter saying that without the machine he would die. Then Allianz suggested cutting the amount of time Prolingheuer was hooked up to the respirator, which would lower treatment costs by eliminating round-the-clock home nurses. In a letter dated June 10, 2009 it asked him for a medical report that would state “to what extent your daily breathing treatment could be reduced to heighten your quality of life” and inquired to what degree his wife assisted him in his daily routine, as “she has been trained in using these machines.”

“We deeply regret causing Mr. Prolingheuer distress,” says an Allianz spokesperson. She adds that while his policy “does not cover the particular medical equipment he requested, Allianz nevertheless provided it after confirming with his m.d. that this was needed.”

Prolingheuer isn’t having any of it. “My insurer would like to see me dead,” he taps out on his black laptop. Lying in a short-sleeve black sports shirt and striped pajama bottoms, Prolingheuer can no longer speak and is mostly confined to his bed. He paid insurance premiums for many years. “Now that I need the basic care, they say no.” He figures his care costs as much as $370,000 a year, of which his out-of-pocket cost is $21,000 in addition to his monthly premiums. If he had to do it over again, Prolingheuer says, he would be part of Germany’s public insurance system–the choice of 90% of the population, 74 million or so people.

People like Angela Jansen, 53. Diagnosed with ALS in March 1995, her care is covered by public insurer Barmer, which, together with the government, pays $360,000 or so a year to support round-the-clock nurses. Jansen, too, can no longer speak or use her hands and legs but relies on a computer with a laser camera that captures the movements of her left pupil as it scans letters on the keyboard. “This thing called Eyegaze the insurer paid for, the wheelchair, the breathing machines … the things I need to live,” she writes. Where it skimps: on medicines, offering generics, which “are not always the best. Sure I get what’s on the list, but not everything is on it,” she writes. One excluded item is a cream that might prevent her bedsores.

This pair of patients with extreme needs represents the two faces of health care in Germany and its mix of private and quasi-public insurance plans. More than any model in the world, the German system offers a glimpse of what health care could look like in the U.S. That’s assuming any bill survives the popular revolt. Unlike many countries with national health–Canada, say, or the U.K.–where private insurance generally supplements public coverage, Germany has two separate systems that coexist, with private plans indirectly benefiting from the cost controls of the public system.

Whether they have public or private coverage, most Germans love their care. In a recent survey by m&m Management & Marketing Consulting 84% of private insurance clients expressed satisfaction; so did 85% of those who rely on the public system. Tough to find that in America. Germany spends $3,588 per capita, per year, or 10.4% of its GDP, on health care. The U.S. shells out $7,290 per person, 16% of economic output. This difference is not because we have more old people. One in five Germans is 65 or older, compared with one in eight in the U.S.

“If you want a health care system where you don’t have to worry that you could go broke, where you could lose your health insurance or get off-the-charts doctors bills, look at the German model,” says Uwe Reinhardt, economics professor at Princeton University. He believes that German and Swiss systems, which offer near-universal care without rationing services, come closest to something that Americans, long used to a private system, could stomach.

Senate Finance Committee Chairman Max Baucus today released a 10-year, $856 billion health care proposal, which is already being met with criticism on both sides of the political aisle.

The Montana Democrat dubbed his bill as balanced and fiscally responsible. At a news conference, Baucus expressed confidence that the final bill will get bipartisan support, despite his appearing without any fellow party members or Republicans.

“Everyone should understand it’s just the beginning, but it’s a good beginning. The choice is now on those on the other side of the aisle,” he said. “At the end of the day, there will be Republican support for this bill.”

The nonpartisan Congressional Budget Office estimates the Baucus bill would cost a total of $774 billion over 10 years. But the bill would, in effect, cost more than $800 billion, Finance committee staffers say, because of differences in scoring between the CBO and Finance committee. That would not account for the $900 billion in federal revenue raised by taxes on insurance companies, employers who don’t offer coverage and assumed cost savings in Medicare that are envisioned to pay for the bill and keep it deficit neutral.

The White House had little to say about the plan, except that it would provide momentum to the president’s goal of achieving health care overhaul in the near future.

“Last week, the president laid out his plan to bring stability and security to Americans who have insurance, and high-quality, high-quality, affordable coverage for those who don’t have insurance,” White House spokesman Reid Cherlin said. “The Senate Finance Committee [proposal] released by chairman Baucus is another boost of momentum for the president’s effort to reform the health system.”

Baucus’ Health Care Plan
Under Baucus’ plan, all Americans would be required to purchase health care or pay a fine if they don’t. It also includes provisions barring insurance companies from prohibiting care based on pre-existing conditions, and prevents practices such as charging more to people with more serious health problems. But, at the same time, the language in the bill suggests that those rules could be relaxed based on tobacco use, age and family composition. It would also place caps on yearly health care costs.

Baucus’ proposal includes a provision to create an insurance exchange system on the Internet, an idea President Obama also proposed last week during his joint address to Congress.

The “state-based Web portals, or ‘exchanges,’… would direct consumers purchasing plans on the individual market to every health coverage option available in their Zip codes,” according to the plan. “The exchanges would offer standardized health insurance enrollment applications, a standard format companies would use to present their insurance plans, and standardized marketing materials.”

Much to the chagrin of some Democratic lawmakers and liberal groups, the proposal does not include any language for a government-run insurance plan that would compete with the private sector. But it opens the way for health care cooperatives — member-owned, non-profit companies providing health insurance. All other bills produced in Congress so far — three in the House and one in the Senate — include a public option.

The proposal also outlines measures to improve and expand Medicaid. Baucus’ plan would make all parents, children, pregnant women and childless adults at or below 133 percent of the federal poverty level eligible for Medicaid. The plan would be paid for with $507 billion in cuts to government health programs and $349 billion in new taxes and fees.

“The Finance Committee has carefully worked through the details of health care reform to ensure this package works for patients, for health care providers and for our economy,” Baucus said in a statement. “We worked to build a balanced, common-sense package that ensures quality, affordable coverage and doesn’t add a dime to the deficit. Now, we can finally pass legislation that will rein in health care costs and deliver quality, affordable care to the American people.”

Under Baucus’ plan, illegal immigrants would not get insurance, a point that became increasingly contentious after South Carolina’s GOP Rep. Joe Wilson’s outburst during Obama’s speech last week.

Senate Majority Leader Harry Reid, D-Nev., said the Democrats are going to hold a special caucus Thursday to discuss the package put forward by the Finance Committee. Baucus’ bill will be voted on next week in the Finance committee before it goes on to the Senate floor.

Since returning from recess last week, the “gang of six” senators of the Finance committee have been working for hours behind closed doors to reach a bipartisan solution. Baucus had set today as his deadline for the bill, despite outcry from both his party members and the GOP. Some Democrats said they would not vote for the bill in its current form because it lacks a “public option,” a government-run insurance program that would compete with private insurance companies. Republicans say the plan is too costly.

Despite the differences, the bill that would pass the Senate Finance Committee has the best chance at bipartisanship. Bills proposed by three House committees and the Senate Committee on Health, Education and Labor led to backlash by conservatives and a rowdy recess for many Democratic lawmakers.

Democrats, Republicans Unhappy With Health Care Proposals
As some Democrats start the difficult task of rallying support in their own party for Baucus’ health care plan, Republicans are lining up against it. Even those who were involved in the negotiations with Baucus, including Sen. Olympia Snowe, R-Maine, and Sen. Charles Grassley, R-Iowa, say additional talks are needed before they can get on board.

“I believe the chairman’s legislation moves in the right direction away from a government-run system contained in bills that have passed other Congressional committees, but a number of issues still need to be addressed — including cost assumptions and ultimate affordability to both consumers and the government as well as ensuring appropriate competition in the health insurance exchange,” Snowe said in a statement.

Other GOP leaders are complaining that the plan would lead to a government takeover of health care in the United States but, at the same time, they are also raising alarm bells that the plan would cut benefits for seniors, who already receive government-run health care in the form of Medicare.

Senate Minority Leader Mitch McConnell, R-Ky., gave Baucus’ plan a thumbs down, saying that it will cut Medicare and set up government-run health care for others.

“This partisan proposal cuts Medicare by nearly a half-trillion dollars, and puts massive new tax burdens on families and small businesses, to create yet another thousand-page, trillion-dollar government program,” McConnell said in a paper statement. “Only in Washington would anyone think that makes sense, especially in this economy.”

McConnell added that it’s just another “trillion-dollar” bill, although the Baucus bill is only $856 billion in its current form. As for Medicare cuts, the bill assumes those savings will be realized with greater efficiency.

Republicans are making a talking point of all the “thousand-page” bills Democrats want to pass, including the other health care bills and the stimulus package. The Baucus bill, as written, is only 223 pages long, but it will get longer when it’s translated into legal language.

But Republican opposition is not the only issue that supporters of Baucus’ plan will have to face. Even before the release of the proposal, Democrats expressed their disapproval with the lack of a public option in Baucus’ proposal.

“There is no way, in its present form, that I vote for it unless it changes in the amendment process by vast amounts,” Sen. Jay Rockefeller, D-W.V., said in a conference call with reporters Tuesday.

Others expressed concern about the proposed taxes on higher-end insurance plans, expected to rake in about $349 billion in new taxes and fees.

“They tax the sort of wealthiest benefit packages, and you’ve got some health insurance, you know — quite a bit of health insurance policies in America that during the next couple of years will top the $16,000 and $21,000 mark that exists in their bill that triggers taxation,” said Rep. Debbie Wasserman Schultz, D-Fla., on ABC News’ “Top Line.”

Democratic Oregon Sen. Ron Wyden said the plan would cost lower-income Americans too much and give many people too little choice of insurance plans.

“If the Baucus proposal passes,” Wyden said in an interview with the Washington Post. “They’re going to say, ‘Huh? Health-care security means I pay a whole lot more than I’m paying today or I get to be exempt from it, or I pay a penalty?’ They’re not going to say that meets the definition of health-care security.’”

ABC News’ Teddy Davis contributed to this report

WASHINGTON — The conventional wisdom, here and around the country, is that the centerpiece of President Obama’s domestic agenda — remaking the health care system to cut costs and cover the uninsured — is on life support and that only a political miracle could revive it.

Here’s why the conventional wisdom might be wrong:

While the month of August clearly knocked the White House back on its heels, as Congressional town hall-style meetings exposed Americans’ unease with an overhaul, the uproar does not seem to have greatly altered public opinion or substantially weakened Democrats’ resolve.

Critical players in the health care industry remain at the negotiating table, meaning they are not out whipping up public or legislative opposition.

Despite tensions between moderate and liberal Democrats, there is broad agreement within the party over most of what a package would look like. Four of the five Congressional committees considering health care legislation have already passed bills. Each would require all Americans to have insurance and provide government subsidies for those who cannot afford it. Each would bar insurance companies from refusing coverage for pre-existing conditions; imposing lifetime caps on coverage; or dropping people when they get sick.

Getting a bill through the Senate remains a big challenge, but even there, the Obama administration has a reasonable chance of corralling the 60 votes it would need to pass legislation more or less on its terms. One wavering Democratic moderate, Senator Ben Nelson of Nebraska, signaled over the weekend that he might be able to go along with one of the compromise proposals under discussion. Senator Olympia J. Snowe, the Maine Republican whose vote would be vital to Mr. Obama, remains deeply engaged in negotiations, and there are indications that one or two other Republicans, like Senator George V. Voinovich of Ohio, might be in play.

Politically, there is an imperative for Democrats to act; they remember well the disastrous political fate that befell them in 1994, when they lost control of the House and Senate after failing to pass a health bill under President Bill Clinton. Rahm Emanuel, the bare-knuckled political operative and former Clinton aide who is now the White House chief of staff, has wasted little time in reminding his fellow Democrats that, as he said in an interview Tuesday, “the inability to act here will have political consequences.”

None of this is to understate the magnitude of the task facing Mr. Obama as he begins a final drive for the legislation with a nationally televised address to Congress on Wednesday night. The size and complexity of the legislation, the deep partisan divide, the undercurrent of concern among voters about whether government is getting too big and intrusive, opposition from special interests — all create land mines that could still blow up the effort.

But even after weeks filled with seemingly ominous portents for Mr. Obama’s ambitions, there is evidence that public opinion remains basically supportive of him. Despite intense controversy over the “public option,” a government-backed insurance plan that would compete with the private sector, a CBS poll at the end of August found that 60 percent of Americans still support the idea, down from 66 percent in July. And half the respondents to the poll said Mr. Obama had better ideas on health care than Republicans, down from 55 percent.

Mr. Obama likes to say that in the 100 years since President Theodore Roosevelt began advocating universal health care, “we’ve never had such broad agreement on what needs to be done.” On Capitol Hill, it is possible to see how a compromise could come together; Mr. Nelson indicated over the weekend that he could back a provision known as a “trigger” to create a public option if private efforts to cover the uninsured failed.

And despite the fracas of August, the major stakeholders in the health care debate — hospitals, doctors, insurers and the pharmaceutical industry — have not abandoned the negotiations. Ralph G. Neas, chief executive of the National Coalition on Health Care and a veteran of Washington legislative fights, said this was especially significant.

“They’re saying to themselves: ‘We’re going to get 30 to 40 or 50 million new customers. This is in our economic self interest,’ ” Mr. Neas said. “That, as much as anything else, could propel this forward to a law that does provide quality health care for all.”

Mr. Obama still clearly has not closed the deal, which is a major reason he will be making his case directly to the American people and their elected representatives on Wednesday night. The CBS poll found that 6 in 10 Americans say Mr. Obama has not clearly explained what his plans for health reform would mean.

That is a problem for the White House, though it also presents the president with an opportunity to reframe the debate on his own terms. In his address on Wednesday, Mr. Obama has promised to outline what he wants to see in a bill; Republican leaders say the message from August is that Democrats and the president need to start over.

“At this point, there really should be no doubt where the American people stand: the status quo is not acceptable, but neither are any of the proposals we’ve seen from the White House or Democrats in Congress,” Senator Mitch McConnell of Kentucky, the Republican leader, said in a statement, adding: “It should be clear by now that the problem isn’t the sales pitch. The problem is what they’re selling.”

Yet Mark McClellan, who ran the Food and Drug Administration and later Medicare under President George W. Bush, said he saw the churning in August as a part of the public’s education, a “necessary step in the process” and not a fatal blow.

Whether or not Mr. Obama gets the kind of comprehensive bill he is hoping for, Dr. McClellan said, Congress is all but certain to take up health legislation by early next year to fix a measure that would impose a draconian 21 percent cut in Medicare reimbursements to doctors. And once it is tinkering with health care, he said, it is not that big a leap to imagine lawmakers using that bill to take smaller steps toward expanding coverage and passing insurance market reforms.

“Everybody is talking about how the public is very concerned about some of the specifics that they’ve heard,” Dr. McClellan said. “But the public is also very concerned about some aspects of the health care system, including the cost, including the security of their coverage. So depending on how this plays politically, I think there is the foundation for building support for broader legislation.”

Small health care cooperatives have worked in a couple of markets. But whether the idea can be applied on a national scale is debatable.

Sen. Kent Conrad, chairman of the Senate Budget Committee, is pushing the co-op idea as an alternative to a government-sponsored insurance program that would compete with private insurers. He doesn’t think a government option will pass in the Senate.

Conrad, a North Dakota Democrat, told CNN’s “American Morning” on Tuesday that his model could attract 12 million members and “be the third-largest insurer in the country and be a very effective competitor [with private insurance companies].”

“If you believe competition helps drive down costs, then they would certainly contribute to holding down costs,” Conrad said.

But Tim Jost, a professor at Washington and Lee University, said that Conrad is not offering concrete statistics on how the plan will help reform health care.

“I have not seen anything, other than Sen. Conrad’s statements to the press, explaining how this is going to work,” he said. “He put out a couple of one-pagers early on, but he is talking about this actuarial data. Let’s make it public, let’s find out who the actuaries are.”

Co-ops are nonprofit organizations that aim to provide better coverage at a lower cost for their members. They put profits back into the system, so any money that is earned is used on patients and other costs. In addition, patients elect a governing board.

Cooperatives are already established in cities such as Minneapolis, Minnesota, and Seattle, Washington.

In order for a co-op to have reduced costs, analysts say, it needs to have tens of thousands of members. That could be a hard slog for the nonprofits because start-up costs would probably be in the millions. That may be where the federal government steps in — by adding seed money for the program.

That government infusion of money probably would put Democrats at odds with Republicans, who are worried about the rising federal deficit and an expanded role of government in health care. 

And the costs of a cooperative might not allow enough people to sign up, meaning that some of the nearly 46 million uninsured Americans wouldn’t be able to buy into the program. Other health reform alternatives, such as the public option, cost less for participants.

“Let’s see how they [Conrad and others] explain that they are going to get to 10 to 12 million members. … I can’t see how that’s going to happen,” Jost said.

Probably the biggest barrier, Jost said, is entering a new market and trying to establish a network.

“You have to go out there, you have to contract with hospitals, doctors, other providers of care. Well, the private insurers have their networks in place, and they often have what they call ‘most favored nations’ clauses, which provide that a provider cannot [offer] a lower rate than it does to the dominant insurer.”

The idea of co-ops appears to have received some support from the Obama administration.

A top White House aide told Bloomberg Television’s “Conversations with Judy Woodruff” that President Obama may accept nonprofit health insurance cooperatives in place of a new government-run plan.

“We would be interested in that” if certain conditions are met, said Nancy-Ann DeParle, director of the White House Office of Health Reform.

And the idea has gotten support from a key Republican senator.

Sen. Richard Shelby, R-Alabama, said on “Fox News Sunday” that co-ops are “a step in the right direction.”

“I don’t know if it will do everything people want, but we ought to look at it. I think it’s a far cry from the original proposals.”

But not everyone is so sure that co-ops will work to reduce health care costs across the board.

CNN Medical Correspondent Elizabeth Cohen, who spoke with top officials at both co-ops, said this type of model would not solve the problem of uninsured Americans.

“Will co-ops solve that? No. That is according to two folks who run co-ops [one in Seattle and one in Minneapolis]. … They said ‘we are not charities. You have to spend money and pay premiums to join our co-ops. And we don’t take everyone. We sometimes say no to people with pre-existing conditions,’ ” she said.

Co-ops also may not have the industry clout of the big insurance companies. 

“They [co-ops] would have some cost advantages over private plans — they wouldn’t have to make a profit — but they are going to be running on a very small scale, at least initially, and therefore they are going to have very high administrative costs proportionate to claims,” Jost said.

“But again, the big problem is how are they going to get providers to give them a better deal than the providers give the private insurers. They may not even be able to legally do that under their contracts with the commercial insurers,” he added.

CNN’s Dana Bash, Lesa Jansen and Chris Welch contributed to this report.

The major argument for a universal system can be found in the spiraling cost of health care in the United States, where insurance premiums continue to rise as do the costs of prescription medication and medical procedures — to the tune of about $2.5 trillion annually. In the current recession, providing health care benefits to employees is a burden many small businesses cannot bear. By the same token, workers who have lost their jobs are hardly in a position to pick up expensive private policies on their own.

Advocates for universal health care argue that such a system is inherently more efficient as it would encourage more preventive care, streamline record keeping for individual patients, and cut out on the repetitive mountains of paperwork that underpin even the most simple insurance claim. Proponents, however, are quick to counter with the real fact that there is no such thing as “free” health care. The services the government proposes providing will be paid for by taxes and no doubt by budget cuts in other areas, perhaps some as crucial as defense and education, thus shifting an unfair burden of cost onto healthy Americans who will be paying for their unhealthy counterparts while losing services in other sectors.

Given the government’s often muddled record of inefficiency, proponents also argue that the transition period from a private to a public system will be one filled with chaos and will, in the end, create an even larger bureaucracy than that already in place. Some estimates place the cost of implementing and supporting a universal health care system at as much as $1.5 trillion over the next decade, a figure far larger than the $634 billion set aside by the Obama administration to jump-start the system.

At the most basic levels, then, the “pro” argument is that the only way to reign in health care costs is to implement universal health care that encourages preventative medicine and levels the playing field of expense while improving record keeping and information sharing. The “con” argument is that such a system will raise taxes, force crucial budget cuts, limit consumer choice, and potentially encourage medical abuses as patients are more likely to access services they do not need because they are “free” for the taking. As is often the case, both sides have valid points, and in either scenario, the American consumer will continue to pay — either through higher taxes or through insurance premiums he may or may not be able to afford.

Given the enormous influence of the insurance and pharmaceutical companies and the significant profit loss a universal health care system would pose for them, the Obama administration faces a long, hard fight in Congress to get its package enacted into legislation and, provided they are successful, an even longer transitional period that will, most likely be fraught with mistakes and red tape. No matter how you shake out the scenarios, it seems that at least in the short term, it will be the American people who bear the greatest burden in either scenario.

• I worked in the healthcare industry for 10 years, in administration and finance, as a Registered Nurse and as hospital business office, IT systems and clinical consultant.  I  worked in California, Texas, and Louisiana.  While working in Hospital Administration and finance I managed patient financial services which dealt with access to services, pre-certification of services for insurance purposes, and the collection of payment for service provided. I also developed an interface between a clinical practice analysis tool and patient financial information which allowed one major hospital to identify best practices based on outcomes and cost associated with specific services provided and the level of co-morbidities associated with the service.  As a nurse I worked in Burns Intensive Care, Med-Surg and long term care and rehabilitation. 

Facts:

• Hospitals must hire and train large patient financial services staff in order to properly pre-certify patients and collect for services rendered.
• Every insurance company has its own guidelines on what is covered and when pre-certification is necessary, without pre-certification insurance companies will not pay for services.  In some cases the insurance company provides pre-certification staff to the hospital / care provider during the normal work week.  Emergency care is provided w/o pre-certification.
• Insurance companies employ large staffs to sell insurance policies,  provide subscriber services, and review claims.
• Insurance companies are slow to pay the average days in accounts receivable for insurance claims was 90 nationwide between 1992 and 2001.
• Care providers partially base their charges for services on expected reimbursement for services, one hospital I worked at as a consultant went from being 22 million in the black to 20 million in the red in the span of a year after managed care carriers became prevalent in Louisiana.  The reason, days in accounts receivable averaged 270, and reimbursement rates averaged 32% of cost.
• Most healthcare providers will set up payments plans directly with the patient if no insurance is provided.  When doing this the cost of services can be lowered by as much as 50% below the same service when insurance is provided.
• Medicare and Medicaid have enormous amounts of fraud waste and abuse as a result of government regulation and lack of oversight.

What is wrong with the governments new plan?

• It penalizes people for not buying insurance?
• It raises our taxes to support the insurance companies, not to ensure we receive quality healthcare – the two are not the same thing.   Most Americans can get quality healthcare when they need it. 

The Solution:

1. Provide tax credits to people who have preventive care on a regular basis and don’t abuse drugs (alcohol, cigarettes, prescription drugs included) or food, allow medical savings plans that don’t force you to lose money if not spent in any given year.  This could be used to fund item 2.
2. Establish a medical sinking fund for all Americans which pays for catastrophic care only.routine care is and should remain a personal
   responsibility.
3. Establish national standards for the cost of services based on outcomes and best practices.  The system to do this has been used for at least the last ten years.
4. Allow patients to die with dignity.you should not be forced to vegetate because someone feels guilty or has a God complex.
    

Larry

By David Whelan – Forbes.com

Eric Remjeske, 38, was skiing in Vail this February when he made the mistake of flying off a jump too slowly. He didn’t clear it. Result: broken bones in both feet and the prospect of big medical bills. So Remjeske, a financial planner who returned home to Minneapolis for surgery, set out to trim his costs. Haggle with your doctor and hospital? These days you’d be crazy not to.

Remjeske needed a night in the hospital plus an orthopedic surgeon to put two screws in each heel. His health insurance included a $6,000 deductible, along with a 20% share of any expense after that. He got quotes from three different surgeons at three hospitals and tried to anticipate related expenses like anesthesia and physical therapy. The estimates ranged from $14,000 to $18,000. He picked the University of Minnesota’s hospital, which had the lowest estimate.

After the successful surgery the bills came, totaling $16,000–more than what he’d expected. Remjeske fought back, objecting to specific hospital charges. The hospital agreed to strike a $500 charge for time in the recovery room, $200 for a leg-lifting device that Remjeske claims wasn’t used and $800 for other items including physical therapy sessions that never happened. He says he missed out on the opportunity to get a deal on his sedation medicine because the anesthesiologist wasn’t able to tell him the price ahead of time. “We think we give the best care, so it’s nice to know that we’re also competitive,” says Jennifer Amundson, a spokeswoman for the hospital.

“If you go in unknowing and come out unknowing, you could end up with an unbelievable bill,” Remjeske says.

The rise in health care costs, and especially in the share paid by the patient, is giving people a lot more incentive to screw up their courage to try to bargain down prices. Last year an average insured family spent $3,350 on copays, coinsurance (the percentage that is the patient’s responsibility), premiums and deductibles. That’s twice the average of a decade ago. Among the many uninsured patients, the ones who are not impoverished are getting skilled at negotiating. Patients pay cash for elective procedures like stomach-stapling or laser eye surgery, so these customers get in the habit of searching for bargains.

No surprise that doctors and hospitals disdain cheapskates. “Shopping by its nature assumes you can judge the quality of the product you’re getting,” says Michael Millenson, a Chicago hospital consultant. On Sermo.com, an online “virtual lounge” only open to physicians, many doctors scoff at the notion of negotiating prices with patients. “There is no negotiating,” writes one family physician. “You’d better come with your credit card or cash.”

Maybe for that physician. But working out a deal in advance makes sense if you plan on paying directly. Debra Snell, who owns T&D Body Shop with her husband in Bowman, S.C., has Crohn’s disease and has been unable to get an insurance policy, so she’s become adept at shopping for care. She cut a deal with her gastroenterologist, Dr. Narayanachar Murali, to pay $35 for an office visit, compared with $150 for a typical patient. For a scope of her lower intestines she pays $400 rather than $750 (or $1,500 at a hospital). Dr. Murali agreed to the lower fees because she pays promptly and fills out her paperwork ahead of time. “Most uninsured people who see me do this part of the work and get quality care at a very low cost,” he says.

Comparison-shopping with hospitals is tricky. One hospital might have 30 different insurance contracts and the same number of rates that it charges them, plus a list price inflated to double or even triple those rates that it charges customers who lack insurance. Out-of-network providers are the most likely to charge sky-high prices. Beware also ancillary providers, such as anesthesiologists, pathologists, radiologists and pharmacists, who might bill separately from the hospital and the surgeon. For those shopping ahead of time, it pays to compare the prices with benchmarks. Healthcare Blue Book, a Web site that launched this January, will tell you what big insurers, the ones with bargaining power, are paying in a given zip code.

Once a bill comes the strategy changes. There are companies that will negotiate a bill on your behalf for a third or so of the savings. Typically they make an offer based on an estimate of what patients with in-network insurance are paying. John Gillis, president of Insnet, a bill negotiator in Scarborough, Me., recommends that those patients confident enough to do the negotiations follow a script. First ask: “Are you authorized to give me a discount?” If yes, “What is it?” Then ask: “Who is authorized to give me a bigger discount?” Ask to speak to that person. When it comes time to discuss specifics, come armed with data on what other patients have paid for similar services. Gillis says he is successful three in four times, once knocking 55% off a $180,000 bill from a New York hospital.

Other negotiation services are geared more toward bill review. Candice Butcher, who runs Medical Billing Advocates of America in Salem, Va., recommends asking for an itemized statement from the hospital, which will typically run many pages. Double billing is common. Some of her tips include making sure that you aren’t being billed separately both for a room and for all the standard amenities in a room like sheets and a toothbrush. Similarly, if you have surgery, she says look for items like “kits” and “trays” and make sure there aren’t also individual charges for specific surgical instruments. Ultimately you can get a 35% discount from the inflated list price just by challenging individual items, she says.

Hospitals often prefer to chop a bill down in percentage terms rather than fight over individual charges. Todd Roscoe, a former executive at the hospital chain Tenet Healthcare, says that a 40% discount off the inflated list price is the norm for cash-paying customers.

A 61-year-old woman living in Albion, Pa. got a $13,000 bill recently for an emergency hospital admission for chest pain and high blood pressure. Her “indemnity” insurance turned out to be a bust–for $320 a month it will pay at most $1,100 in room and board at the hospital but won’t cover drugs or procedures. She went to the hospital billing office where a rep offered her a 50% discount because she was paying herself. Since she was unemployed, the assumption was that she would pay it off month to month. From $6,500, she asked what they would charge if she paid it all at once and she got another third off the bill. She is in the process of paying just over $4,000 by cashing in a 401(k) account.

James Muckle, who manages a 32-unit apartment building in Sebastopol, Calif., had a similar experience. He got hit with a $6,000 bill after a four-hour visit to the er that consisted of a diagnosis of kidney stones, pain pills and instructions on how to pass the stones. He called the hospital and politely noted he was surprised by the charges. He says he was offered a 40% discount if he paid within 30 days. After an hour of back and forth, asking the clerk to explain each charge, he asked if he could pay $1,000. The hospital countered with $2,300, and he eventually paid $2,000. “Maybe I should have pressed it a little more,” he says.

Medical Markdowns

These web sites publish the prices of procedures, which help when negotiating. Remember that hospital fees are different from physicians’ fees. Also, the cost of imaging, drugs, lab work and anesthesia are often billed separately.

Healthcarebluebook.com
Changehealthcare.com
Outofpocket.com
Myhealthscore.com

These companies offer bill-negotiation services for the nonconfrontational. They typically charge a contingency fee based on the percentage of savings achieved:

Myinsnet.com
Medicalcostadvocate.com
Billadvocates.com

Rep. Ron Paul (R-TX) has been a very vocal critic of the president’s plan. He spoke to Kiran Chetry on CNN’s “American Morning” Wednesday.

Kiran Chetry: You’re a physician as well and I’m sure that you have a lot of thoughts on this issue as we debate health care. You oppose President Obama’s reform plan. You favor giving Americans control of their health care. Does it boil down to two different philosophies over who should get health care coverage? Do you believe not everyone can expect free or low cost health care?

Ron Paul: Yeah, I think there’s a lot to that. But I come from the viewpoint that the most important thing we do is preserve the doctor/patient relationship, which we do not. For the past 30 years or so we’ve had a lot of government involved. We have veterans care, we have Medicare, we have Medicaid and we also have a lot of people getting private insurance. People having private insurance are not all that unhappy. So what are we doing now or at least Obama is proposing that we turn the people that have service on insurance and make them join the governmental programs that everybody is unhappy about.

So it doesn’t make any sense. It’s a total failure to run anything by a bureaucracy. It always costs more and the services are always less favorable. So for us to pursue government solutions to a problem the government created sort of reminds me of the T.A.R.P. bailouts. You know what we do financially. So medical bailouts by more government when government created our managed care system of 35 years will only make things much worse.

Chetry: One of the things we’ve talked about is whether or not independents are backing this. There seems to be some eroding support because of concerns about whether or not we can afford it, whether or not the timing is right. Even though there is that apprehension right now about whether or not we can afford it most do agree that we need to do something about health care. Is there a Republican alternative out there that makes more sense in your opinion?

Paul: Oh, yeah. I think so. I think we should pursue the idea that the patient get control through the medical savings accounts and deductions so that you can deduct everything. The biggest problem is the misunderstanding about insurance. They talk about we need to give everybody insurance. You can’t give people insurance – you don’t expect from your car insurance to be able to buy gasoline and do all your repair bills and that’s not insurance. And this is not insurance either. Insurance would be major medical to take care of the big problems.

That is one of the basic problems. As far as costs goes, they’re estimating $1 trillion or $1.5 trillion in the midst of this crisis no wonder people are starting to wake up a little bit. Because the money just isn’t there. The one thing for sure, is if you look at every other previous program by government, if they proposed that say the prescription drug program would cost $49 billion, well, it might turn out to be $150 billion. It’s always much more so if they’re saying $1.5 trillion for this, be sure it’s going to cost two or three times that much.

Chetry: What do we do, though, about this problem with, you know, uninsured children, many people uninsured – the millions? Your state by the way, according to the United Health Foundation survey, ranks 46 out of 50 in terms of overall health. And one of the biggest challenges for your state right now is that there’s a high percentage of children in poverty and a big uninsured population. So, there you are opposing this, your state seems to be in dire straits when it comes to this situation. What’s the solution for Texas?

Paul: Well, one thing you have to do is say, why do people come up short and why is the cost so high? It’s inflation and it’s a government management of the health care system that is at fault. But even though I have my ideal system I would like to see with the government out completely because that would be a much better system, that’s not going to happen. I’m realistic. One thing we shouldn’t do is pay for it with money created out of thin air. So what I would do in a transition, I’ve talked about this a whole lot, is cut spending somewhere and take care of the very people you’re talking about. Because you don’t want to cut, under these conditions, medical care from poor people who have been dependent or the elderly.

But I would cut from overseas spending. I would cut from these trillions and trillions of dollars that we have spent over the years and bring our troops home so that we can finance it. A first, very, very minor step was done yesterday by cutting the F-22. I applaud Obama for that. We don’t need one system removed – we need to change our foreign policy. Then we could afford the health care that is necessary to tide us over until we have come to our senses and believe freedom can deliver medical care much better than a bureaucracy in government. You have to deal with the problem of inflation as well because that’s why people find that medical care costs too much.

(CNSNews.com) – Voters in Arizona will decide next year whether residents will be subject to mandates in the pending health care reform that President Barack Obama and congressional Democrats are promoting.
 
At least five other states – Indiana, Minnesota, New Mexico, North Dakota and Wyoming – have considered proposals to take pre-emptive action against the pending federal mandates, but those proposals have either not made it out of committee, failed to get enough votes from one side of the legislature, or are still being crafted.
 
Only the Arizona Legislature introduced an initiative (HCR2014), which if passed, would amend the state constitution to codify that no resident would be required to participate in any public health care option. Arizonans will vote on the initiative in November 2010.
 
“HCR2014 is proactive and will protect patients’ fundamental rights,” Arizona State Rep. Nancy Barto, a Republican, said in a statement. “We are a front-line battle state to stop the momentum of this powerful government takeover of your health care decisions. Health care by lobbyists thwarts your rights and can be stopped here.”
 
The main issue is the core of the Obama health plan – a government run or “public option” – to compete with private health insurers. Some state lawmakers fear such legislation would force residents to buy into the public plan.
 
“The eyes of the nation will be on Arizona next year to see what happens,” Christie Herrera, director of the Health and Human Services Taskforce with the American Legislative Exchange Council, told CNSNews.com. “If this succeeds in Arizona, other states will take notice and push harder.”
 
The Obama administration insists that the public option will provide another choice for Americans who are not insured or are unhappy with their current insurance and will force private companies to be more competitive.
 
Critics of the plan say private firms could not compete with a public option – with unlimited government resources – and thus would go out of business, leaving what is tantamount to a single-payer system in place.
 
What happens in Arizona could spur other states to pass similar laws or constitutional amendments, said Wisconsin State Rep. Lea Vukmir, a Republican, who sponsored similar legislation in 2008 that passed the House but failed in the Senate. 

If the Obama administration’s “public option” becomes law before Arizonans vote in November 2010, their initiative would still allow the state the challenge the Obama plan.
 
Vukmir said that the Obama proposal could be unconstitutional, under the Tenth Amendment, which states, “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”
                          
“I’m a strong believer in the Constitution and the Tenth Amendment,” Vukmir told CNSNews.com. “The Tenth Amendment has been eroded by Congress and the Supreme Court for decades. We have to ask, does the Tenth Amendment have any meaning? We are supposed to have strong state governments and a weak central government. That has eroded away.”
 
Georgia State Sen. Judson Hill, a Republican, said that the Obama plan would put a big strain on state budgets and told CNSNews.com that he would be interested in introducing similar legislation in the Georgia state house.
 
Medicaid and S-CHIP payments to states already make cutting costs untenable for states in lieu of a benefit cut or tax hike, Hill said.
 
He has introduced legislation to use state medical grants to go directly to patients as a sort of medical scholarship. (S-CHIP is the acronym for the State Children’s Health Insurance Program, run by the federal Health and Human Services, which provides matching funds to states that provide expanded health insurance programs for families with children in low- to moderate-income brackets.)
 
“I call them federal crack dollars,” said Hill. “States get addicted to health dollars sent by the U.S. government.”
 
Arizona’s Health Care Freedom Act, firstly, establishes the right of state residents to spend their own money to seek and receive health care and, secondly, the right to choose not to participate in any health care system of any type.
 
An advocacy group was started to campaign for the amendment.
 
“Protecting the rights of individuals to be in control of their health and health care must be a fundamental component of health care reform, so the Arizona legislature is to be congratulated for giving all Americans the opportunity to make certain our voices are heard,” said Dr. Eric Novack, chairman of the group Arizonans for Health Care Reform.

Biden made his pitch as senior administration official Nancy-Ann DeParle huddled with Democrats struggling to forge a consensus on a health care bill before the planned August congressional recess.

Health care reform is the “foremost economic and moral issue that this administration is determined to deal with,” Biden told the business leaders at a meeting near the White House.

He noted that premiums for employer-provided health insurance have doubled in the past nine years, rising three times faster than wages.

As a result, small business owners are “being forced to make some very difficult and … unnecessary choices,” he said. “[They] are faced with deciding to provide coverage that is increasingly swallowing up more and more of their bottom line, not providing coverage at all or having to raise the cost of the service or product they’re selling, making them uncompetitive.”

Biden also argued that the federal government “cannot sustain this trajectory of health care costs … and think we’re ever going to get control of our fiscal house.” 

The vice president’s remarks came a day after fiscally conservative House Democrats known as “Blue Dogs” effectively put the brakes on health care legislation by pressing the Democratic leadership for significant changes to the draft bill.

As Democratic leaders worked feverishly to finalize details of the legislation, initially slated for a Friday rollout, the Blue Dog Coalition released a letter Thursday night saying the bill “lacks a number of elements essential to preserving what works and fixing what is broken.”

Forty of the group’s 52 members signed the letter, making it clear that a major block of the House’s Democratic Caucus wants some concessions in return for their votes. Shortly after the letter’s release, a group of Blue Dogs met in the office of House Speaker Nancy Pelosi, D-California, with other leaders for nearly two hours.

Rep. Mike Ross, D-Arkansas, a leading negotiator for the Blue Dogs on health care, told reporters that he and Reps. John Tanner, D-Tennessee, and Allen Boyd, D-Florida, also met with White House Chief of Staff Rahm Emanuel on Wednesday to go over their concerns.

“The message to him was the same as to the leadership — that we could not support the current bill,” Ross said.

Boyd said that no deals were struck Thursday night, but the group agreed to meet Friday with Reps. Henry Waxman, chairman of the House Energy and Commerce Committee; Charlie Rangel, chairman of the Ways and Means Committee; and George Miller, chairman of the Education and Labor Committee.

Boyd and other members representing rural areas pushed leaders to adjust the rates that Medicare pays rural doctors and hospitals for health care services.

“From a practical standpoint in terms of a timeline, a bill doesn’t come into the House chamber until you’ve got the votes to pass it, and I don’t think they have the votes to pass it at this point,” Boyd said. “We’ve got to try to get to point where we’re comfortable.”

Pelosi on Thursday repeated her pledge that a government-run health care plan would be included in the House bill, but Ross said conservative Democrats have major reservations about how a public option would work.

In the letter and in the meeting, the conservative Democrats stressed they did not want a “Medicare-like” structure for a public option.

“What we are saying is — if there is a public option, it can’t be based on Medicare rates unless the regional disparity in Medicare rates is fixed,” said Ross, who also plans to press for more controls on government spending on health care and more savings from changes to Medicare.

House Majority Leader Steny Hoyer, D-Maryland, waved off any suggestions that Thursday night’s development was a setback.

“Let me make it very clear that everybody in that room thinks we ought to pass health care,” Hoyer said.

But he acknowledged they still need to work through the details.

I have been a proponent of universal health care and single payer since retiring from the practice of surgery more than 10 years ago. During this decade I have never waffled on my conviction that our nation should transition to a system in which every citizen has an equal opportunity to obtain their health care from practitioners of their choice.

Further, I am convinced that the for-profit form of health care has morphed into an uncontrolled hierarchy of greed that has escaped from the normal restraints of personal ethics, compassion, empathy and basic unqualified concern for one an other without reservation. I feel that social justice should leap to the forefront of our decisions when an individual — any individual — has a health problem. Accordingly, it is obvious that universal health care has my support, and it is not surprising that polls of physicians, nurses and the general population concur.

Now, we have arrived at a point in the history of our nation where it is reasonable to say that universal health care is near at hand, and after trying practically everything else, the vast majority are convinced that a reform has arrived. Black, white, Republican, Democrat, Green, young, old, Catholic, Jew, Muslim, Asian, Native American, rich or poor — a modern melting pot has come to be, and we are all in it together. After a 10-year wait, I am delighted, the bus has arrived. I hope.

Single payer usually tags along when universal health care is the subject at hand. At times when being discussed, they are wed, and health care reform may be referred to as “universal single payer.” That’s too fast for many who look upon this as two separate entities. Not me, though. I believe we, as a nation, deserve both. I further believe that single payer will happen, and we need to work diligently to make this happen sooner, rather than later.

Another decade of waiting, with its stymieing of small business, its shameful financial effects on the middle class, its drain on state treasuries, its primary etiology in bankruptcy and its continuous release of wealth to special interests, cannot be tolerated by a nation already brought to its knees by mammoth fraud, greed and incom-petence. We cannot add health care to the list that includes Enron, banks, brokerages, insurance companies, a protracted automotive industry collapse, and stunning Ponzi schemes. We, as a nation, are on the ropes. The time has come to learn to say no. No more rip-offs. No more robbery. We have come to a fork in the road with a hairpin turn. We need to take the high road regardless of forks and turns, regardless of the consequences to those who have taken advantage of us. We cannot tolerate another hit.

Single payer is a great way to start. A great way to express the confidence we have in our federal government to do the right thing on our behalf. To show that we are tough at home as well as abroad. All we want is a fair and inexpensive accounting of expenditure of health care dollars. This is single payer, not socialized medi-cine.

When we hear criticism of the federal government, with critics saying they do not trust the government to run health care, then we simply should remind such skeptics that our federal government already administers and funds well over 50 percent of total health care expenditures by this nation. We should remind them and our-selves that the government already runs a stable of health care agencies which are national jewels, and include: Medicare, Medicaid, military medicine, Food and Drug Administration, National Institutes of Health, Centers for Disease Control and Prevention, Public Health Service, health care aid to the Third World, World Health Organization participation and aerospace medicine.

We are fortunate to have such a list — a list whose executives are employed by us and whose compensation is Main Street, not Wall Street. A list that could be enhanced enormously simply by adding single payer.

——————————————————————————–
Richard C. Dillihunt, M.D., a retired general, vascular and transplant surgeon, lives in Portland.

Medical problems caused 62% of all personal bankruptcies filed in the U.S. in 2007, according to a study by Harvard researchers. And in a finding that surprised even the researchers, 78% of those filers had medical insurance at the start of their illness, including 60.3% who had private coverage, not Medicare or Medicaid.

Medically related bankruptcies have been rising steadily for decades. In 1981, only 8% of families filing for bankruptcy cited a serious medical problem as the reason, while a 2001 study of bankruptcies in five states by the same researchers found that illness or medical bills contributed to 50% of all filings. This newest, nationwide study, conducted before the start of the current recession by Drs. David Himmelstein and Steffie Woolhandler of Harvard Medical School, Elizabeth Warren of Harvard Law School, and Deborah Thorne, a sociology professor at Ohio University, found that the filers were for the most part solidly middle class before medical disaster hit. Two-thirds owned their home and three-fifths had gone to college.

But medically bankrupt families with private insurance reported average out-of pocket medical bills of $17,749, while the uninsured’s bills averaged $26,971. Of the families who started out with insurance but lost it during the course of their illness, medical bills averaged $22,658. “For middle-class Americans, health insurance offers little protection. Most of us have policies with so many loopholes, co-payments, and deductibles that illness can put you in the poorhouse,” said lead author Himmelstein. “Unless you’re Warren Buffett, your family is just one serious illness away from bankruptcy.”

The study underscores President Barack Obama’s arguments in calling for health-care reform legislation this year. In a letter to Democratic Senate leaders this week, the President said: “Health-care reform is not a luxury. It’s a necessity we cannot defer. Soaring health-care costs make our current course unsustainable. It is unsustainable for our families, whose spiraling premiums and out-of-pocket expenses are pushing them into bankruptcy and forcing them to go without the checkups and prescriptions they need.”

Highest Costs for Diabetes, Neurological Illness
The study was funded by the Robert Wood Johnson Foundation and published online June 4 by the American Journal of Medicine. It will appear in the Journal’s August print edition. The researchers examined the court records of a random sample of 2,314 bankruptcy filings across the nation during early 2007, and also contacted those filers for written explanations. The researchers then followed up with extensive phone interviews of 1,032 of those filers.

They found that a number of medical factors contributed to a family’s financial disaster. More than 90% of medically related bankruptcies were caused by high medical bills directly or medical costs that were so high the family was forced to mortgage their home. The remaining 8% went bankrupt because a medical problem caused them to lose income. The authors were not able to track credit-card defaults caused by medical bills, but a 2007 study found that, of low- and middle-income households with credit-card debt, 29% used their plastic to pay off medical expenses.

Individuals with diabetes, one of the most common chronic diseases in the U.S., and those with neurological illnesses such as multiple sclerosis had the highest costs, an average of $26,971 and $34,167, respectively. Hospital bills were the largest single expense for half of all medically bankrupt families.

Dr. Woolhandler, an advocate of a single-payer health-care system, said lawmakers in Washington should reconsider health-care reform in light of the study. “Covering the uninsured isn’t enough,” she said. “Reform also needs to help families who already have insurance by upgrading their coverage and assuring that they never lose it.”

Arnst is a senior writer for BusinessWeek based in New York.

Medical tourism is the practice of “outsourcing” healthcare services to an area outside of the patient’s home country.  Many common operations cost a fraction of what they might cost in the United States. 

As healthcare costs continue to rise, more and more patient’s are beginning to realize the potential cost savings!  Not sure I would be willing to leave the comforts of home, but I understand that some may not have the option…  

Medical Procedure       USA               Mexico       Cost Rica       India      Thailand   Korea

Angioplasty              Up to $57,000     $17,100      $14,000    $10,000     $9,000     $21,600
Heart Bypass            Up to $144,000    $21,100     $26,000    $10,000     $26,000   $26,000
Heart Valve Rep.      Up to $170,000    $31,000     $31,000     $3,000       $24,000    $38,000
Knee Replacement Up to $50,000       $11,500     $12,000    $9,000        $14,000   $19,800
Hip Resurfacing       Up to $30,000+    $13,400     $13,000    $10,000      $18,000   $22,900
Hip Replacement      Up to $43,000      $13,800     $13,000    $10,000      $16,000   $18,450
Special Fusion        Up to $100,000    $8,000       $16,000    $14,000      $13,000   $19,350
Face Lift                 Up to $15,000      $8,000       $6,500       $9,000       $8,600       $5,000
Breast Implants      Up to $10,000       $9,000       $4,000      $6,500       $5,700      $13,600
Rhino Plasty           Up to $8,000         $5,000       $6,000      $5,500       $5,400       $6,000
Lap Band/Bariatric  Up to $30,000       $9,200       $9,000      $9,500       $14,000    $11,500
Hysterectomy        Up to $15,000       $7,500       $6,000      $7,500       $7,000      $11,000
Dental Implant   Up to $2,000/10,000   $1,000       $1,100      $1,000       $1,000      $2,000

 *Prices are as of 2009 -  Prices are approximate and not actual prices and include estimated airfare for patient and companion.  Prices will vary based upon many factors including hospital, doctor’s experience, accreditation, currency exchange rates and more.  Not included are costs for meals, miscellaneous expenses and any hotel costs or tourism costs. 

Prices obtained from Medicaltourism.com.

Craig

Health insurance premiums for an average family are $1,000 a year higher because of costs of health care for the uninsured, a new report finds.

And private coverage for the average individual costs an extra $370 a year because of the cost-shifting, which happens when someone without medical insurance gets care at an emergency room or elsewhere and then doesn’t pay.

The report was released Thursday by advocacy group Families USA, which said the findings — which it calls a “hidden tax” — support its goal of extending coverage to all the 50 million Americans who are now uninsured. Congress and the Obama administration are working on a plan to do that.

Families USA contracted with independent actuarial consulting firm Milliman Inc. to analyze federal data to produce the findings.

“As more people join the ranks of the uninsured, the hidden health tax is growing,” said Ron Pollack, Families USA executive director. “That tax hits America’s businesses and insured families hard in the pocketbook, and they therefore have a clear financial stake in expanding health care coverage.”

The report found that, in 2008, uninsured people received $116 billion in health care from hospitals, doctors and other providers. The uninsured paid 37 percent of that amount out of their own pockets, and government programs and charities covered another 26 percent.

That left about $43 billion unpaid, and that sum made its way into premiums charged by private insurance companies to businesses and individuals, the report said.

The major government insurance programs — Medicare for the elderly and Medicaid for the poor — are structured in a way that doesn’t easily allow payments to insurers to adjust upward. And somebody has to pay.

In the case of people who are covered through their employers — most insured people under 65 are — the extra costs from the uninsured would be spread between the employer’s health plan contribution and what the employee pays, but the report didn’t attempt to quantify that division.

Ronald A. Williams, chairman and chief executive of Aetna Inc., gave the example of a local community hospital that provides care to someone without insurance who arrives at the emergency room. When it’s not paid for, the hospital has to raise its rates to insurance companies, and they pass that on in higher premiums, Williams said.

“Our members then say, ‘Well, why is health insurance so expensive?’” Williams said in an interview. “And the answer is because you’re paying for your own care as well as for the care of some of the uninsured in the community.”

Aetna was not involved in writing or funding the report but Williams appeared at a news conference Thursday with Families USA officials to release its findings.

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Copyright © 2009 ABC News Internet Ventures

Over 9,000 Americans in all 50 states and the District of Columbia signed up to host Health Care Community Discussions.  Thousands more participated.  Friends, family, neighbors, and co-workers, representing the views of both health care patients and providers, came together in homes and offices, coffee shops and fire houses, universities and community centers, all with a common purpose: to discuss reforming the health care system.

The 3,276 group reports were systematically analyzed and the information generated by the Health Care Community Discussions captured in the report, Americans Speak on Health Reform: Report on Health Care Community Discussions.

Accounts and plan data are easily accessed online by HR, for plan administration functions, and by employees for inquiry and contribution updates, regardless of employer size. Online reporting and analysis based on qualified medical expense data, as well as, premium and deductible data is always available. The real time data tools create a complete picture of plan participation and usage specific to the company.

 NEOS CDH has also improved its secure healthcare document services for EOBs, Statements, Out of Pocket Receipts, and other healthcare attachments. These improvements include enhanced search capabilities and additional privacy options for personal image storage and retrieval.

NEOS Consumer Driven Healthcare is a HIPAA compliant third party administrator with a focus on CDH administrative services and products. NEOS is a provider of services and applications that drive self service functionality coupled with superior customer service. NEOS offices are located in Phoenix, Arizona.  Additional information about NEOS Consumer Driven Healthcare can be found online at www.NEOSCDH.com.

For NEOS Consumer Driven Healthcare:

Barack Obama’s American Recovery and Reinvestment Act of 2009 was signed on February 17, and is already beginning to filter out funds to hopefully stimulate the economy. One of the principal goals of the package is to reform the health care system while creating jobs and insuring more Americans. Through measures to support the unemployed, integrate cutting-edge information technology systems into medical networks, and insuring more children, the act may in some way affect how you receive health care. Find out how.

1.  Health care industry set to go tech: One of Obama’s umbrella strategies for reforming health care and stimulating the economy involves pumping money into health care technology systems. He hopes to create a health information network for hospitals, rural and urban clinics, and other health care centers by making all medical records electronic; making existing medical technologies more accurate and effective; and reducing errors in medical care. This technology boost to the health care system will, Obama hopes, save money, create jobs, and improve the standards and delivery of health care and medical information. The Dallas Business Journal reports that the stimulus package will invest $19 billion for health information technology.

2.  The unemployed will still receive health care benefits, at least temporarily: Obama plans to ease the burden of health care costs for the unemployed and reduce the number of uninsured Americans by extending Medicaid benefits to the unemployed, at least for a time. Individuals who get unemployment checks would also be able to receive Medicaid, as would their spouses and children who are under the age of 19, reported the New York Times in January. States will receive federal aid to help ease Medicaid costs. In late February 2009, TheState.com reported that Obama “released $15 billion in economic stimulus Medicaid funds for states” to disperse.

3.  Children’s Health Insurance Program Reauthorization Act of 2009: The Senate and House reformed the Children’s Health Insurance Program under this legislation, which extends insurance to nearly 4 million more children by reworking the Social Security Act. The program will help families of low-income children who do not qualify for Medicaid pay for their health insurance, and states will still be able to set their own income eligibility requirements. The program is funded by a tax increase on cigarettes.

 4.  Governors hold power over releasing funds: While the federal government has designed and approved the health care stimulus package, governors are in charge of actually releasing funds, creating eligibility requirements when appropriate, and overseeing the implementation of the stimulus plan in their states. In late February, governors like Louisiana’s Bobby Jindal (R), opposed many parts of the economic plan and may reject at least some of the money that is coming to their state from the federal government. The New Orleans Times-Picayune reports on Nola.com that Jindal will most likely accept the Medicaid supplements, but according to Medical News Today, other governors are begrudging about accepting funds that are meant to be used in a specific way. Instead, governors like New Hampshire Gov. John Lynch (D) are arguing for more flexibility in how they disperse the federal funds.

 5.  Federal government helps states fund COBRA for unemployed: The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives individuals who are laid off, retired, switching between jobs, or have dependents at the time they stop working the option to continue their group health benefits for a limited time. Some beneficiaries may have to pay for the group rate insurance, however, but the U.S. Department of Labor holds that “COBRA generally requires that group health plans sponsored by employers with 20 or more employees in the prior year offer employees and their families the opportunity for a temporary extension of health coverage.” Under Obama’s stimulus plan, the federal government will provide states with subsidies to help offset the costs of COBRA. They will pay for up to 65% of COBRA premiums “for eligible workers who are involuntarily terminated,” according to the accounting firm Amper, Politziner and Mattia. Qualifying workers include those who have been involuntarily terminated on and after September 1, 2008, and qualifying employers include those who are subject to COBRA legislation, as well as small employers who are subject to State Continuation legislation.

 6.  Job training funding for those entering health care industry: In another measure to stimulate the economy while improving health care standards, Obama plans to increase job training opportunities for those entering the health care industry. The stimulus budget has allotted $750,000,000 “for a program of competitive grants for worker training and placement in high growth and emerging industry sectors,” $500,000,000 of which will go to renewable energy programs. The rest will be distributed by the Secretary of Labor “giv[ing] priority to projects that prepare workers for careers in the health care sector.”

 7.  Preventive care takes precedent: In his address to Congress in February, Barack Obama outlined the promised benefits of his economic stimulus benefits, highlighting the fact that the health care reform boasts “the largest investment ever in preventive care, because that is one of the best ways to keep our people healthy and our costs under control.” According to a report by NPR, this move would also create jobs, at least in the short term, even if it did not result in sustainable medical research projects, as hoped.

8.  A contract for accountability: In order to promote accountability in health care reform and to make sure that all of this funding is actually helping the economy and the health care industry, Obama’s plan includes a contract between the federal government and the Institute of Medicine. The stimulus package outlines that the $1.5 million contract will require the Institute to “produce and submit a report to the Congress and the Secretary [of Health and Human Services] by not later than June 30, 2009, that includes recommendations on the national priorities for comparative effectiveness research” that will eventually be subjected to public commentary and review.

9.  Health IT dominates in all areas of medical industry: The stimulus package lists several ways in which new health care information systems and technologies will help the facilitation of medical care and the industry as a whole. These include the exchange of patient medical records and a subsequent reduction in wait times at hospitals and health care facilities; the increase of telemedicine technologies for those living in rural areas and who do not have access to cutting edge medical resources; “technologies that help reduce medical errors;” and “technologies that meet the needs of diverse populations.”

10.  Total health care stimulus cost: $150 billion: The total cost of all these (and more) health care reforms under the American Recovery and Reinvestment Act of 2009 is $150 billion, according to the Dallas Business Journal, including $17 billion for Medicare and Medicaid incentive programs, $2 billion for technology grants, and $19 billion for a health information technology movement.

I have no figures to quote or studies to point to, just my innate sense that the un- & under-insured in our country may be using a disproportionate amount of health care dollars by accessing care for lower priority health issues at facilities designed to offer a higher level of care (i.e. accessing emergency rooms for colds).  I’m sure we’ve all heard the “common wisdom” that this is so.  Assuming that it is, it seems to me that it would reduce the cost of healthcare across the board if appropriate care could be provided in the appropriate setting by appropriate practitioners.

Another factor that I haven’t noticed being addressed is the shortage of key medical personnel, such as nurses, general practitioners, family doctors, obstetricians, dentists and others.  While these shortages affect everyone, they can be more significantly detrimental in underserved areas.

Additionally, it seems to me that having under- and un-insured individuals go for long periods of time without health care ultimately results in the care they eventually receive costing more and requiring longer periods of care.  To eliminate this, it would seemingly make sense to work to get them insured sooner rather than later.  In order to accomplish this, underwriting and financial access issues would need to be addressed. 

One last thought:  the development of medications and technologies to combat disease is universally beneficial.  Sharing the responsibility, costs and benefits universally would also seem to make sense and would, hopefully, accelerate the discovery of new treatments and cures.

To that end, I offer the following suggestions and ask for your thoughts in refining and expanding them:

 1.  Offer tax incentives to hospitals, clinics & urgent care centers who work in underserved areas a minimum of 30 hours/week.  The 30 hours to encompass a minimum of 1 hour before 7 AM and 1 hour after 7 PM at least 2 days/week and 3 hours on Saturday and Sunday.

 2.  For facilities opening in underserved areas willing to safely and appropriately renovate and/or remove and rebuild “blight” structures, Federal money should be made available to the local police department for the purpose of providing security.  The amount of money to be applied to be based on factors such as local population and crime rate in facility’s immediate vicinity.

 3.  Salaries paid to health care professionals (doctors, nurses, technicians) and limited to 2 administrators/site in underserved areas to be tax exempt for the first $100K (gross and unadjusted).

 4.  Create a federal insurance program (like the federal flood insurance program) for catastrophic illness (i.e. cancer, ESRD, Alzheimer’s, HIV) and require all health insurance carriers to contribute 1% of every policyholder’s premium to the program’s fund.  In years in which the carriers net profit exceeds 20% above the average net profit for the previous 5 years, they would be required to pay 10% of the net profit above 20% to the fund.  Upon confirmed diagnosis, the federal program would repay to the insurance carrier 75% of all care costs (including medications) paid on behalf of the insured.  Claims with any of the defined diagnosis codes denied would be subject to review by the same board that currently reviews Medicare claim denials.  GAO to do random financial and performance audits, with every carrier with audits performed a minimum of once every 5 years.  Deliberate fraud punishable by repayment to fund of 100% of monies paid for all patients from catastrophic fund for entire period of fraud plus a 10% penalty and posting of a bond equal to 33% of the amount of the fraud.  Said bond to be maintained for 5 years and to be released only upon completion of passing GAO audit.  Subsequent fraud would result in forfeiture of bond and loss of license in all states to sell health care coverage to Federal Employees and Medicare members for a period of 5 years.

 5.  Make health insurance premiums paid by individuals who do not qualify for coverage through an employer-sponsored plan 100% tax deductible up to an adjusted annual income of $200K with the deduction reduced by 10% for each $25K over $200,001.

 6.  Make payroll deducted employee health insurance contributions (including both fully and self funded plans) pre-tax for those whose adjusted income is less than $200K.

 7.  Reduce the threshold for claiming out of pocket medical costs as a tax deduction from 7% of adjusted income to 5% for adjusted incomes less than $200K.

 8.  Offer interest free scholarships in medical fields to highly qualified candidates where there is lower enrollment but a higher public need (i.e.:  nurses, family practitioners, obstetricians, general dentistry).

 9. Offer grants to cover 100% of tuition towards specific medical degrees in return for 2 year commitment to actively practice a minimum of 1300 hours/year in under-served areas (i.e.:  Indian reservations, low-income urban areas)

 10.  Standardize health insurance underwriting for specific chronic conditions on the condition they be certified by a physician to be under control for a minimum of 1 year with either diet/lifestyle change or medication at time of application (i.e.:  Type II diabetes, asthma, cholesterol, high blood pressure).  The rating factor applicable to these conditions when they meet the controlled criteria should be standardized (i.e.:  asthma +1.5%, Cholesterol +3.0%).

 11. Cancer survivors who have been certified to be in remission for a minimum of 5 years and have no other risk factors must be offered coverage with the pre-existing condition rated in the same manner as those conditions referred to in item 10.

 12.  Insured individuals who actively reduce their health risks (i.e. appropriate weight loss or gain, smoking cessation, reduced cholesterol, etc) may, at their discretion, request a review of their physical condition by their family/primary physician 2 months prior to the renewal of their policy to present to the insurer which is to be considered in determining renewal rates.  Significant, maintained health improvement should be “rewarded” with consideration when underwriting renewal rates (i.e.:  if rate increase would have been 8% consideration might allow for a reduction to a 6% or 7% rate increase). 

 13.  A public access website should be created using Medicare accumulated data showing a RANGE OF AVERAGE cost of care for the most common diagnoses and treatments by zip code (i.e. New patient office visit/consultation in zip code 60606:  $180 – $215).  (Although this information is more typically available to members of insurance plans through their secured websites, for uninsured individuals, gathering this information in order to make informed health care decisions is very difficult.)

 14. If medical procedures can be performed safely and more cost effectively overseas, allow 50% of travel exclusively for the performance of these procedures to be tax deductible if not covered by an insurer.  If the patient is insured, insurer must cover the procedure cost at the benefit level specified by the COC, assuming the procedure cost is a minimum of 25% less than if performed in-country:  i.e.:  if their in-country contracted rate for San Diego, CA for a hysterectomy is $1400 with the patient responsibility of 20%, the insurer would pay up to $1050 to the out-of-country provider with the patient paying 20% of the actual cost.  Insurance carrier has the right to ‘vet’ the out-of-country facility to ensure appropriate care and safety.  Insurance carriers would be permitted to negotiate contracts with out-of-country facilities and make a listing of “approved” facilities available upon request to insured’s.  Insurance carriers would NOT be permitted to pressure insured’s to receive care out-of-country.

 15. The US should seek to enter into an agreement with other like-minded countries to create an international fund (contributions to which would be pro-rated based on each country’s population) the purpose of which would be to subsidize pharmaceutical and scientific research into treatments and cures for cancer, HIV, Parkinson’s, Alzheimer’s, etc.  Distribution of funds to be determined by a board of independent, non-political scientists, medical professionals and representatives from organizations such as WHO, NIH, CDC, etc and their international counterparts.

Patients are likely to seek health care information wherever they can these days, from friends, other patients and, increasingly, the Internet. They may also have the urge to add their own voices to the mix.

For these patients, Web sites such as Angie’s List and RateMDs.com can be a place to opine and rate their physician experience.

But information on the Internet is still information on the Internet, which means it is of uncertain credibility. And inaccurate physician ratings have the power to do a lot of damage when patients forget to take them with a grain of salt.

A company called Medical Justice from Greensboro, N.C., has been attempting to remedy what it calls misinformation by heading off would-be posters with a waiver, to be signed pre-treatment, in which patients promise not to contribute to online rating sites about their doctor.

But the idea of signing such a waiver does not sit well with some patients.

“I would not use a doctor that pushed that in any way,” said Danielle Panetta, 34, who has type-1 diabetes and visits specialists monthly to care for her disease. “It’s not legally binding as far as I’m concerned.”

Preventing the Inevitable?
Restricting online activity in any way may be a losing battle.

According to a study from the Pew Internet and American Life Project, 74 percent of adults in the United States go online and, of those, 80 percent look for health information online. Another study from 2006 showed that 29 percent of Internet users had looked online for information about a particular doctor or hospital.

“If there are doctors who are nervous, they should be nervous,” said Susannah Fox, author of the Pew studies. “This is a tried-and-true activity online, researching a product or service before you buy it.”

But Dr. Jeffrey Segal, CEO and founder of Medical Justice, says the waiver his company developed is not trying to restrict information but that the company is more interested in quality control.

“There is a disconnect between what we expect of health care in general and the system out there asking patients to rate their doctors,” Segal said, pointing out that the average doctor, who may see thousands of patients each year, may have only five ratings on a site.

Good Luck With Quality Control
“Patients are granted additional privacy protection above and beyond that mandated by law. In return, patients are asked not to post on online rating sites without the doctor’s permission,” Segal said. “It’s been characterized incorrectly as a gag [order].”

Segal said that the “additional privacy protection” includes physicians refraining from giving patient information to companies that may wish to market to people with specific health problems.

Still, attempts at quality control on the Internet appear to be dubious, at best.

Dave deBronkart, 59, who blogs at The New Life of e-Patient Dave, pointed out that his own excellent physician could get a handful of nasty reviews online.

“That’s just the nature of democracy,” deBronkart said. “I do think it’s hopeless to try to hold back the tide. And it’s going to be bumpy along the way but things will improve. … When things are transparent, things improve eventually.”

How Is Your Doctor?
And patients are looking for transparency in their health care information.

Jim Conway, senior vice president at the Institute for Healthcare Improvement in Cambridge, Mass., said the state of Massachusetts has been conducting consumer research in the past six months about what people want to know in terms of healthcare. One of the top three things users want to know is what other people think of their hospitals and their doctors.

“The perspective of the consumer is unbelievably important,” Conway said. “In helping people make decisions around where they’re going to seek care.”

But patients know that consumer rating sites, particularly anonymous, unmonitored ones, are not the be-all and end-all source for physician information.

“It’s a good thing for patients to have access to but you’ve got to watch out,” said Panetta, an attorney in Boston, Mass., who is also actively involved in diabetes patient advocacy. “The people that are more likely to use it are going to be people who have an axe to grind, and it may be because they’re crazy.”

Segal pointed out that defamers could also be competitors, former employees or ex-significant others. Nor is there a way to monitor undeserved praise.

The Waiver Is a Questionable Solution
But a waiver such as the one Medical Justice proposes doctors use may not be the solution.

“I don’t see how that kind of contract could actually protect the physician in any other specific way than they would have without the contract,” Panetta said.

As with other printed defamatory comments, Panetta said, the doctor could ask the host site to remove the comments and, if they did not, he or she could sue, which may not be effective.

“I think it doesn’t work for any of the parties,” Panetta said. “You can’t contract away liability.”

Straining the Relationship?
But the wrong kind of contract can set the tone for the important doctor-patient relationship.

“Great patient care is the result of a partnership and trust-relationship between the patient and the people taking care of the patient,” Conway said. “I worry that the introduction of something like this could begin to break down trust.”

Segal believes the waiver, if presented correctly, can address the trust issue head on while acknowledging the patient’s need to voice opinions about his or her experience.

“We don’t want to repackage the problem because we know the inevitability of useful Internet rating sites,” Segal said. “Try and view the program as a way to move the process forward where patients and doctors share in the solution rather than engaging in adversarial relationships.”

Preventing Internet users from using the Internet as they like is a tall order, doubly so when it comes to healthcare where seeking out others’ opinions is ingrained.

Blogger deBronkart knows exactly what he would do if his doctor confronted him with a waiver asking him not to post comments about him online.

“I would decline,” he said. “But I would look him right in the eye and say, ‘You don’t need to worry about me shafting you.’”
Copyright © 2009 ABC News Internet Ventures

If 24 months ago, someone had predicted a catastrophic real estate price collapse, auto company bankruptcy, stock market decline, bank failures and rising unemployment, that person would have been called alarmist. At risk of being called histrionic, we are predicting that health care in the United States is in danger of collapsing within 24 months.

Eighty years ago, in 1929, as hospitals tried to find a way to stay in business in the face of a failing economy, Blue Cross was founded by a group of Dallas teachers who agreed to pay about 12 cents a week for up to 21 days of hospitalization a year at Baylor University Hospital. The American Hospital Association supported the origination of Blue Cross because it was a way to guarantee regular revenue during hard times.

For the schoolteachers, paying $6 per year for insurance was a way to assure they would receive at least minimal care if they became gravely ill. Since then, expectations and costs for payer-provided health care have grown dramatically.

In our current period of reduced expectations, most Americans continue to expect high-quality healthcare at affordable prices when they walk into a doctor’s office or if they are admitted to a hospital. But that is changing.

Hospitals in Trouble
More and more, Americans have to wait for insurance company permission before receiving life-saving medical treatment or, if they are on Medicaid, they have to go to specific city and county hospitals to be treated. Hospitals are in financial jeopardy, reimbursements to doctors discourage preventive medicine and there is a severe and growing shortage of nurses.

The U.S. Food and Drug Administration, which has the responsibility to assure that drugs are safe and effective, is in disarray, and pharmaceutical research and development has become a singularly focused quest for blockbuster drugs, those that create $1 billion or more of revenue per year.

The U.S. hospital system is currently the weakest link in the health care chain. The total number of hospital beds in the U.S. has dropped since 1981and the number of beds per 1,000 people has declined from more than four per 1,000 to a little over 2.5 per 1,000 in 2006.

Hospital finances are precarious. More than half of hospitals are technically insolvent or at risk of insolvency. According to the American Hospital Association, in 2007, uncompensated care costs were $34 billion, with an additional $31.9 billion gap between costs and payments to hospitals for Medicaid and Medicare patients. In addition to philanthropy, some hospitals are forced to rely on unpredictable sources of funding, such as gift shop revenue or parking fees.

Hospitals now spend nearly $100 billion per year to provide uninsured patients with health services. During the 2008 election, the total number of uninsured in the U.S. was between 40 million and 50 million people. That number is growing, and uncompensated hospital care continues to increase as the number of uninsured goes up.

Money Woes
For every percentage of increase in the unemployment rate, 2.5 million people become uninsured. With the unemployment rate jumping about 3 percent since mid-2007, that translates to another 7.5 million uninsured.

Even without unemployment problems, fewer employers are paying for health insurance, and even among those that do, plans are transferring more cost to the patients through increasing co-payments, larger deductibles and changing rules on what is covered and what is not. Two groups of Americans are experiencing growing insurance coverage gaps — children who reach the age when they are no longer eligible for their parents’ insurance coverage and older workers, who lose their jobs and are not yet eligible for Medicare.

The medical system pays more for treating sick patients than for preventing disease. Doctors in preventive specialties are reimbursed much less than those who attempt to reverse the consequences of years of neglect. For example, cardiac and thoracic surgeons, who perform surgery to limit damage from high cholesterol, earn on average, two-and-a-half times more than family medicine and internal medicine specialists, who monitor patients and prescribe medicines to prevent the need for such surgeries.

People who suffer from largely preventable diseases, such as heart disease, stroke and diabetes, incur more medical costs than healthy people their age and die at higher rates than the healthy population. One disease, diabetes, kills more than 75,000 people in the U.S. annually, and is closely linked to the national epidemic of obesity, which is clearly preventable.

It is estimated that by 2020, the shortage of nurses will reach 1 million. Nurses perform most of the patient care in the country’s 4,897 community hospitals. Nurses monitor patients, track vital signs and administer drugs. If a hospital patient takes a turn for the worse, it is the nurse who will be first to respond and take action. Yet, staff nurses earn less on average than a real estate property manager, who isn’t exposed to deadly diseases, doesn’t have to make life-or-death decisions and isn’t required to regularly work nights and weekends. It is not surprising that there is a growing gap between the need and availability of registered nurses.

The Drug Problem
The FDA, and other agencies, which have responsibility for ensuring the efficacy of drugs and the safety of food we consume, are on the verge of collapse. The current problem with peanut product purity is only the most recent in a long line of failures to protect the food Americans consume. These failures frequently lead to illness, and in some instances, death. There was an even more dramatic failure this past summer when heparin, a life-saving blood thinner, was found to have been made with adulterated ingredients. As a consequence, as many as 62 people are believed to have died.

For a half-century, most pharmaceutical research and development has been carried out by large pharmaceutical corporations. But R&D has been hammered by decreasing profits and increasing corporate bureaucracy.

Though large pharma is focused on blockbuster drugs, the need for mundane cures is more necessary than ever. As early as 2005, more people died from antibiotic-resistant infections than from HIV/AIDS, and the threat of these so-called superbugs increases every year. R&D on new antibiotics is at a virtual standstill because, according to the prevailing large-pharma model, developing yet another antibiotic doesn’t pay.

In 2008, only 21 first-of-a-kind drugs were approved by the FDA, but 46 new or updated black-box warnings (the highest level warning) were issued in the first nine months of the year, which indicates problems that were identified only after the drugs were approved. At the same time, development-stage biotechnology companies, where most of the really innovative R&D takes place, are finding it almost impossible to raise the cash they need to keep their doors open.

Consumers Hindered by Lack of Information
All these problems are enhanced by lack of information. The average patient knows more about the cost of a brake job on an automobile than the cost of medical care. Patients are finding it harder and harder to make informed choices. Ask a physician about the cost of a procedure or diagnostic test and you are liable to get a non-answer. Charges and reimbursements vary by insurance carrier and individual plan to the point where there can be a wide variety of differences among them. Explanation of Benefit reports are often confusing and lack critical information, so it is difficult for patients to identify which procedure or examination is being reported.

The U.S. health care system is sick. We can wait until the patient needs heroic intervention before taking action, or we can treat the patient now, before the cost goes higher and before thousands of people suffer needlessly.

Today, 80 years after the first Blue Cross plan was created, we need a new mechanism that will enable Americans to continue receiving the medical care that will keep us healthy and provide for us in the event of disaster. Based upon the experience of Great Britain and Canada, it is clear that such a mechanism should not be purely governmental. It is equally clear that our present system, which is largely based on private funding, is inadequate. What is required is a uniquely American solution to the health care challenge that melds private and public funding in a way that benefits the patient and provides economic continuity for caregivers.

Steve Brozak is president of WBB Securities, an independent broker-dealer and investment bank specializing in biotechnology, medical devices and pharmaceutical research.
Copyright © 2009 ABC News Internet Ventures

Much has been written and discussed regarding the plight of the uninsured. Various programs and subsidies have been proposed to help alleviate this problem. It’s important to ask, who exactly constitute the uninsured? Most experts define uninsured as people who routinely pay at least 10 percent of their annual income toward medical expenses, not including insurance premiums. Federal law allows the deduction of medical expenses that exceed 7.65 percent of gross income. The burden of increased healthcare costs are not only affecting the uninsured, but also people that have insurance. Of the people that are still fortunate to have jobs that subsidize their medical care, most employers are increasing deductibles, co-pays, and out-of-pocket costs to keep their health plans in place. Premiums are going up and with it, including the employees’ share of those premiums. How can people manage these costs?

There are a number of things you, as the consumer, can do to help with potentially higher out-of-pocket costs. Oftentimes spousal or family coverage can be really expensive. That’s because the employer typically doesn’t subsidize any portion of dependent healthcare. If you’re family members are in good health, it may be helpful to enroll them in a comparable individual plan. (Depending upon the state you live in, group coverage may be their only option if they are uninsurable.) On the portion of healthcare that you pay on a group health plan, whether for yourself or your dependents, be sure the amount you pay is taken out before taxes as well. Another way to help minimize medical expenses is to enroll in voluntary products if your employer offers them. These are payroll-deducted plans that start around $4 a week. They usually are taken out of your paycheck before any taxes are taken out, reducing their cost further. These voluntary plans pay an amount per occurrence for accidental injuries, certain sicknesses, lost time from work, etc. to offset the increased exposures from employers trying to manage their bottom line.

When you are faced with medical debt it may be tempting to ignore it. In a word, don’t. The bills themselves won’t go away. Typically they are turned over to a credit agency that then starts harassing you to pay. The best thing to do is to work out payment arrangements with the providers before it goes into collection. When a bill goes into collection, the provider is paying that agency a fee to attempt to collect the debt for them or giving them a percentage of what is ultimately collected. It’s far better to try and negotiate the balance due directly with the providers than to try to negotiate after they have already put it into the collection agency’s hands. If you aren’t able to negotiate your bill down don’t be tempted to put it on a credit card. Putting it on a credit card totally eliminates your chance of reducing the bill through negotiating with the provider. Additionally, should you miss a payment on a credit card, the interest rate could be hiked to 29 percent or higher. The interest that a collection agency charges shouldn’t be anywhere near that high. Same thing with second mortgages. Although you may be able to write off the interest, the additional time it takes to pay off your mortgage translates into many, many times the original amount of the medical debt and also puts you at a greater risk of foreclosure.

Many people are eligible for assistance with their medical bills and don’t even know it. It’s important to know not only federal programs, but state-specific programs designed to help those faced with high medical expenses. Even pharmaceutical companies have programs to enable people to purchase their necessary medication at reduced prices. The key is to explore your options.

You don’t have to be a slave to your medical debt. The key is preparing. Supplemental programs can be very helpful and doesn’t cost the employer anything. Help and various options are available to help you manage medical debt once you get it. The key to this is being informed. Doing a little research before you throw your hands up in despair is always a smart choice.

Until next time, stay healthy!