No Mandate for Moffit

Interesting McClatchy piece in yesterday's Charlotte Observer, written by Robert Moffit of the Center for Policy Studies, about individual mandates. I am an unlikely candidate to support anything that comes from the Heritage Foundation, but I've got to admit, I'm with Moffit about 95% of the way.

Moffit's basic point is that individual mandates already exist, since taxpayers are already paying for health insurance in the form of uncompensated care and Medicaid and Medicare. He appears to put a lot of the blame on "people who can protect themselves through health insurance" but "are failing to do so."

I'm not sure I agree with that, since he doesn't clarify who he's referring to (I mean, what qualifies as affordable? What makes you too "low-income"? ... I want some percentages on why people don't buy insurance before I'm sold on this), but he has a point that unpaid medical bills are distributed to the rest of us in the form of higher premiums. He calls it "irresponsible" for people to ask others to pay for their bills. Fair enough.

Moffit writes

That's why my Heritage Foundation colleagues and I support the "personal responsibility principle." It's a simple idea: All adults have a responsibility to buy their own health insurance, pay their own health-care bills, and not shift those costs to others.

He supports the purchase of "catastrophic" insurance policies as a minimum form of coverage, which I assume can be purchased at a lower price than every day insurance plans. However, he writes, "People who do not wish to buy health insurance for whatever reason should be free to do so."

So no individual mandate for Moffit. I guess I shouldn't be surprised. His suggestion instead? People who "choose" not to purchase insurance "must demonstrate in some tangible way that they are really going to pay their own hospital bills," such as by putting thousands into an escrow or by providing some sort of financial guarantee that they can indeed pay those medical bills, should they incur them.

And if they don't?

The people who choose this option should no longer be able to claim a personal tax exemption when filling out their IRS and state tax forms every year. Somehow, these people should pay something that could be used to offset, to some degree, a portion of the rising costs of the uncompensated care.

I guess my problem with his whole argument is that he is operating under the assumption that people choose not to have insurance. And while I admit I live in a little health care news bubble, which tends only to focus on the cases that make you sympathetic, and have my young adult "invincible" tendencies, I'm just not buying it. I don't have a couple thousand to throw in an escrow, Mr. Moffit (in fact, I'm not really sure I even know what an escrow is), unless somehow my college loans and credit card debt are magically transformed into profit. As it stands, I struggle enough with my day-to-day living expenses. And from everything I read, the people without insurance are the self-employed with previous medical conditions, who maybe are solidly middle-class, but can't afford the hundreds or thousands per month that insurance companies want them to pay, or are people who just can't get insurance because they're too sick. To imply that people don't get health insurance because they don't want it is a little elitist/health-ist for my tastes.

To his credit, Moffit does suggest tax credits or vouchers for those who can't afford catastrophic care policies. But at what levels? Is he talking Medicaid levels? Because seriously, those income requirements are a joke. Just because someone makes 110% of the poverty level doesn't really mean that they are any more able to afford health insurance than those making 99% of the poverty level. (100% of the federal poverty level is an annual income of $10,210 for an individual.)

Alright, I'm changing my mind, I agree with Moffit about 70% of the way -- I should have known better than to almost agree with anything the comes out of the Heritage Foundation. In conclusion: Personal responsibility, good. Finger pointing at the uninsured, bad.

You're making me sick, Moore

Started this last week about Michael Moore's new documentary on the U.S. health care system. I'm looking forward to the movie coming out of Friday, so I can watch, and then really (knowledgeably, promise) rip it to shreds. I am a huge liberal, but Michael Moore just pisses me off. Enough with the theatrics already. Plus, I really disagree with the single-payer system and if this movie starts some movement, I will be angry.

UAW Shows "Flexibility"

UAW President Ron Gettelfinger said on a Detroit radio program on Monday he is considering offering some health care concessions to Chrysler, now that the company is posting losses. Gettelfinger said, "We've been talking to Chrysler quite frequently -- we do need to find a way to fix the problem there now that Chrysler is in a downward mode."

Detroit News reports

While the UAW has historically fought to preserve top-tier health benefits for retirees, the union has shown some flexibility in light of the severe financial issues facing Detroit's automakers.

Gettelfinger is looking for a deal similar to that offered to Ford Motor and General Motors back in 2005, which were posting high enough losses to warrant the reduction in health care benefits.

The deal required GM and Ford retirees to accept modest co-pays and deductibles, while active UAW employees gave up $1 an hour in raises.

Personally, this doesn't sound like such a big deal, considering Chrysler is in the red, although I admit I have NO idea how much autoworkers earn. If the reduction in benefits amounts to increased competitiveness with foreign imports, that would be a good thing, in turn perhaps keeping a greater number of workers employed in the long-run.

I think retirees are going to be screwed though. If you're promised one thing when you retire, and then a couple of years down the road it changes, it doesn't give you proper time to adjust your budgeting. Gettelfinger does seem particularly concerned about this, which is good. I personally think retirement benefits will go by the wayside in favor of 401(k)s, it's just going to be a painful phasing out.

**Closing quote from Troy Clarke, GM's North America's chief: "If there is a cost that keeps me up at night, it's health care. We have the retiree health care issues and it's very stressful. We've got to come at that some way.

More coverage from the Associated Press.

More coverage from the Detroit Free Press.

Haha, suckers

Fast food sucks, doesn't it?

Many were once convinced that Japanese people lacked the fat genes found in other groups. According to figures compiled in 2005 by the Paris-based Organization for Economic Cooperation and Development, only 3.2 percent of Japanese people had a body mass index greater than 30, compared with 30.6 percent in the United States.

Candidate Updates

I'm going to be honest here, I really only plan on blogging about the candidates who I personally think are viable.

For the Democrats:

• Hillary Rodham Clinton
• Barack Obama
• John Edwards

For the Republicans:

• Rudy Giuliani
• Mitt Romney
• Tommy Thompson (not really because I think he's viable, but because his whole platform is basically about health care ... at least, so you'd think from the coverage)
• Fred Thompson (again, not really because I think he's viable. I just really love Law & Order)

That said, here are some updates on their stances on health care:

• "Bearing scars, Clinton cautious on universal plan," McClatchy. Clinton's being a bit vague on her health care proposal to avoid comparisons to her last plan, while playing up her health care "scars." Smart move.
  
• "Edwards to Detail Health Care Plan," Associated Press. I personally thought he had already detailed it enough, but apparently he did it again today in Michigan. Also, he's added proposals to end patents on breakthrough drugs and require insurance companies to spend 85% of premiums on patients care.
• Gialiani has a 12 Step program for the country, one of which is increasing access to health care: "Giuliani Offers Up 12 Steps to a Better Future," Washington Post. "Rudy's Plan for the U.S.: 12 Promises to Keep if he Becomes Prez," New York Post.
  

Side note on party differences from the article on Clinton:

Democrats describe the escalating cost of health insurance and the rising number of uninsured Americans as "a crisis." All say they want universal coverage.

Republicans rarely mention health care, except when asked about it. Former New York Mayor Rudy Giuliani and Sen. John McCain of Arizona don't list health care in the "issues" section of their campaign websites. Former Massachusetts Gov. Mitt Romney rarely talks about his successful effort to make health insurance mandatory for Massachusetts residents.

Carmaker drama continues

Associated Press today reported more on the high cost health care puts on car manufacturers.

General Motors, Ford and Chrysler will seek labor cost reductions that put them on par with their Asian rivals during summer contract talks with the United Auto Workers, officials of the three automakers said Wednesday.

Detroit News columnist Daniel Howes, citing people familiar with Ford's bargaining strategy, reported earlier Wednesday that Ford would seek to cut hourly labor costs by 30 percent, from about $71 to around $50, including wages, pension and health care.

That's a pretty huge cut for workers and while UAW can fight some of it, I don't think Gettelfinger will be completely successful in blocking health care and pension benefit reductions. AP continues

UAW spokesman Roger Kerson would not comment Wednesday, but union President Ron Gettelfinger said in March that it made major health care concessions in 2005 to Ford and GM that saved the companies billions, and he implied that the union wasn't willing to give more. The UAW has completed an evaluation of Chrysler's finances but won't say whether it will give Chrysler the same deal.

Thoughts on high-deductible health plans

Okay, don't want to go into this in too much detail, but the Wall Street Journal today published a piece about how high-deductible health plans (HDHPs) with health savings accounts aren't gaining traction with workers. To me, this seems kind of self-explanatory. I mean, when given a choice between a plan that will pay for a lot of things for me, and a plan in which I have to save my own money and make a lot more choices, I'm going to choose the easy, cheap one. Of course, if you are telling me I have a choice between no health care and a HDHP with an HSA, I'm choosing the HDHP/HSA. Something is better than nothing.

One huge problem is, and the Journal notes this, that there simply isn't enough information out there for consumers to make educated choices about price versus quality in choosing doctors. If I was looking for a doctor to perform a heart bypass, would I really want the cheapest? But if I have this plan, that's what I'm constantly going back to. Not to mention, plenty of sites looking to compile data on costs have found that hospitals don't just toss out a price for any given procedure. Hospitals have one price for one insurance company, one price for another, one price for Medicaid and Medicare, and one price for the uninsured. Trying to get a straight answer about final cost is not easy.

On top of costs, where would I find information about quality of care? There isn't easily comparable data out there. I read some recent coverage (I forget where) about different companies trying to set up quality data about hospitals and even states, like New Jersey for heart surgery, that rate doctors and hospitals about very specific procedures. But really, the U.S. health care system just isn't there yet. It's not comparable data ... some sites measure quality in different ways, making a hospital good on one site and bad on another.

So really, it's no surprise that HDHPs/HSAs haven't caught on yet. They are just TOO much work. Health care is important, but I just want it, I don't want to have to research it. I have other things to do. Maybe Bush is right when he says we need a culture shift toward people acting more like consumers about their health care. But right now, it's just not easy enough to make it worthwhile.

The Individual Mandate

Last Thursday, Republican presidential candidate Rudy Giuliani psuedo-announced his national health care proposal on the Sean Hannity radio program. According to the Long Island Newsday, Giuliani made "no mention of covering everyone" in the U.S. during the interview. Meaning no individual mandate, popular in most Democratic candidates' plans (not particularly surprising, but still...).

Obama received quite a bit of criticism for his health care proposal, which makes health insurance a requirement for children but not for adults. A Boston Globe editorial states:

Senator Barack Obama came out yesterday with his plan, which comes close but doesn't cover everyone, though he implies it does. ... without a broader mandate, he can't be sure adults will buy insurance."

An opinion piece in the Chicago Sun-Times writes

Obama proposes mandating coverage of children but not adults, opening the question of whether his plan will lead to Obama keeping his first pledge, to sign a universal health care law by the end of his first term.

Apparently Obama felt a bit threatened by the criticism and wrote in a letter to the editor in the Boston Globe that

The major reason that 45 million Americans don't have health care is not that they don't want it, it's that they can't afford it. If we require people to purchase insurance before we bring down its cost, we'll make a bad problem worse.

He added that the editorial was "inaccurate" when it "stated that my universal health care plan would not cover everyone," adding, "My plan will cover every American."

I agree with Obama in that requiring people to purchase insurance right away will most likely create significant problems for a lot of lower-income people. Massachusetts is having problems with that right now ... the only age group for their new insurance law that has affordable coverage is young people ages 19 to 26. The state is going to have significant growing pains come July 1, the date set for the law's enforcement, which maybe could have been lessened if the state slowly implemented the mandate.

In the long run though, the individual mandate is necessary to balance the risk pool for insurance companies. If 19- to 26-year-olds -- the healthiest age group and the one least likely to purchase insurance -- don't buy insurance because it's going to cost them $150+ per month (I personally fall into this age range and would find it difficult to come up with the extra $150, in addition to my student loans, credit card debt, and overpriced rent), then insurance companies are going to be over-burdened with health care costs for the sick. If a mandate is what it takes to get healthy people to buy insurance, then it's necessary in order to lower premium costs across the board.

More news on health care cost crisis for car makers...

CEO and Chair of General Motors Rick Wagoner discussed the effects of health care costs on the company's bottom line. AP/Philadelphia Inquirer reports:

[Wagoner] said that the company had made progress with the United Auto Workers in becoming more competitive, but that more needed to be done in forthcoming national contract talks this summer.

GM, he said, needs to "further reduce our still-unsustainable health-care bill, which was a staggering $4.8 billion in 2006."

A couple of the big automakers are discussing creating a trust fund of sorts for workers' health care, which would allow them to put in a set amount and allow the unions to control how the money is spent (called a VEBA, or Voluntary Employee Benefit Association). A May article in Business Week, writes that leaders at GM, Ford , and Chrysler "believe they may have a cure for Detroit's epic health-care woes" in VEBA.

VEBAs would hand "over the companies' long-term liability to an independent fund managed by the UAW, which would be financed by a huge one-time injection of cash and stock. Union workers would probably contribute more toward their own coverage costs but would gain protection from the devastating prospect of bankruptcy."

I'm not sure how I feel about VEBAs yet, but they seem like a pragmatic compromise if done fairly.

Welcome

Welcome to Health Care Policy 101. My name is Emily is I will be your blogger, from now until ... I lose interest, most likely. A little bit about myself: I've been writing for a couple of different health policy publications for about 7 months now and the experience has taught me some things:

1. Health care is incredibly, and I mean incredibly, complicated. Managing a hospital is complicated, health care law is complicated (one exec at the company I work for actually used the phrase, "I feel sorry for anyone who entered health care law"), and crafting health care legislation that can actually pass through one or both of the chambers -- not to mention the White House -- is really complicated.
2. Health care is so important right now. Which could be because there's a presidential campaign going on ... but more likely it's because the whole employer-based health insurance system is falling apart. Some 46.6 million U.S. residents were uninsured in 2005, according to the U.S. Census Bureau, and companies are increasingly having difficulty dealing with the rising costs. Chrysler has said repeatedly that the costs associated with health care for workers adds $1,000 per car as compared to competitors (see recent coverage by the AP/Houston Chronicle). You know when you have businesses like Wal-Mart teaming up with the SEIU and corporate giants like Safeway calling for health care reform something is very, very wrong.
3. It's going to be a long time before anything gets done. It just is. Any candidate who claims they can get universal coverage by 2012 is being incredibly optimistic. Democratic candidates, you know who you are.

So with those very basic assumptions, I begin to blog. Looking forward to the months ahead, and to hearing your thoughts.