A recent Wall Street Journal (WSJ) editorial on federal health reform decried the Massachusetts version as recklessly out of control and warned the rest of the nation to avoid such liberal delusions. For those that missed it, the subtitle under the headline was “The Massachusetts debacle, coming soon to your neighborhood.” Chapter 58 was passed three years ago this month, and it’s clear the WSJ is voting thumbs down. It is worth looking at some facts on how things are going — given the federal health reform agenda the Massachusetts model will get a lot more attention, both good and bad.
There are 432,000 newly insured by the most recent estimate. That means 97.4% of Massachusetts residents are insured, more than any other state in the US and close to the levels in the Netherlands and Switzerland where universal health care coverage is the law.
The WSJ noted that only 21,000 of the newly insured had obtained insurance privately in the free market via the Connector products, but that 165,000 were insured via free or subsidized government programs. What they neglected to mention was that nearly all of the rest (i.e., the majority) had become insured by taking up employer based insurance, encouraged by the artfully crafted employer requirements and the individual mandate. This is the first time in decades that this state has experienced a significant enrollment increase in private, commercial health insurance. Moreover, the rate of employers offering health insurance has actually increased in Massachusetts while nationally, fewer employers are offering coverage.
Finally, and significantly, the cost of broadening healthcare coverage has been distributed equitably across the newly insured, employers and government. A recent report from the University of Massachusetts, sponsored by the Blue Cross Blue Shield Foundation of Massachusetts has shown that the proportionate cost from each of those sources is almost identical to the level prior to implementation of expanded coverage. Surveys continue to show that the overwhelming majority of state residents support health reform and feel that the state has made progress on access to care (by a factor of almost 3:1).
There are obvious financial pressures in Massachusetts but these are more related to the tormented economy and healthcare cost inflation than health reform. Unfortunately, increased unemployment and reduced state tax revenues will make the tension worse. But the truth is that the cost for the state to fund health reform has been remarkably close to what was expected. Initial state government costs were about 13% higher than budgeted because the count of the number of uninsured proved to be an underestimate and more people enrolled in subsided insurance faster than predicted. Recent annual growth for the program is down to 7%, almost exactly the same as the aggregate national figure on healthcare cost increases. Premium increases for individuals with subsidized insurance have averaged less than 5% each year, and the fund to cover the state subsidized products is actually in surplus this year – one of the rare segments of the state budget that is!
Effective cost management is needed to deal with healthcare cost trends, not just because of health reform. Price controls and rationing, as threatened in the WSJ editorial, are being actively discussed. Price controls have never worked in healthcare; it seems unlikely they will this time either. With the current zeal for government regulation, we may see price controls anyway. As mentioned in this space previously, rationing healthcare on the grounds of clinical effectiveness may sound ominous but it makes more sense than the way we ration currently based on geography, employment and socioeconomic status. It is not as though we live at rationing Level 1 with unfettered application of any therapy that’s out there and are going to leap to Level 10 where everything is rationed/planned as if in a Soviet model. There is a great deal of practical work that can and will be done on comparative effectiveness (with funding from the federal stimulus package) which will have a trivial impact on choice and a major impact on cost trend.
Extending healthcare coverage to a broader population is not the cause of medical inflation although it can be a multiplier. The real opportunity to manage costs will always comes back to coordination of care for chronic illness (remember, 70% of healthcare spending is on 10% of patients) and the removal of barriers built into the payment system that make this impossible or difficult to do. Maintaining a high percentage of uninsured is not a cost containment policy.
David F. Torchiana, MD
Massachusetts General Physicians Organization
The problem with the Massachusetts reform package is that it keeps and boosts the most expensive and non-productive part of our national non-system — insurance companies.
Why can’t we have a rational discussion of the value of insurance companies in a health system per se?
Rarely is this being discussed and is usually couched in dismissive terms.
The nation would save money and lives if we merged Medicare, Medicaid, S-CHIP, the VHA and the healthier group selected by insurance companies. The expensive groups (pools) we take care of through taxes could be offset by the healthier ones. There’s a reason insurance companies try not to cover sick people.
Insurance coverage is not more efficient or cheaper, except of course when it denies care. The endless complex forms which waste the time and money of hospitals and doctors also have the effect of wasting the money we pay for insurance. That same money spent on a single-payer system would cover everyone in the country (and without Medicare recipients having to pay another $4-10,000 per year in Medigap insurance).
We are the least healthy nation among the 36 leading developed nations.
We have the highest infant and/or maternal death rates, the lowest number of doctors per 1,000 population, the shortest life spans (3 years on average), and the most chronic illnesses.
For that “privilege,” we pay more than any of the other 35 nations and about 1/3 more than the average.
The Massachusetts experiment shows that compromising with insurance companies makes them richer and leaves the insured often with too little money to pay the co-payments, so therefore they must skip care. Further, those policies are usually very limited.
While I disagree with the Wall Street Journal on what is wrong with Massachusetts’ system, and I respect the legislators’ good-intentioned and serious efforts to get control of the problem, I feel that the problem in both cases is that we need a single-payer, not-for-profit system.
The Canadian national government doesn’t control health care; it requires certain basic care (essentially: doctors’ office visits, dental care for children, and necessary hospitalization), then distributes MORE (not less, which we typically do) than the per head cost of those needs. The money goes to the provinces (like our states). Each province decides on the package offered to its residents in addition to the required items — dental care to the elderly, nursing home care, or whatever. A group of citizens negotiates the salaries of health care personnel every 3 years (I think it is) and the price of drugs and medical hardware, etc.
They pay a fraction of what we do (per person) and are substantially healthier. Yes, there are backups for some procedures or exploratory machinery, but here we simply deny care — not put it off — for 100’s of thousands. Here, our emergency care sections of hospitals sometimes have people waiting for 14 hours; there, care is usually within 10 minutes.
Doctors aren’t as rich there, but then they don’t need to earn as much because they don’t have $200,000 in medical school debt or humongous incompetency insurance to pay. There are more doctors so they aren’t as stressed. People routinely take care of illness because it doesn’t cost cash and it’s convenient, which means major illnesses are caught early.
No system is perfect. Not even France’s, which is the best. But the rest of the developed world has discovered the truth — single-payer, universal systems work better than “the market.”
As a visitor, a passer-through, a tourist, I have used the systems briefly in Canada, England, France, Israel, Palestine, and Austria. I never had a bill. I had excellent care. I never had to wait.
Yours truly,
Alison Long
Thank you, Alison. The Baucus and Kennedy porposals are essentially the MA model and will not solve the health care crisis in America anymore than it has been solved in MA. Having a health insurance card means nothing if you can’t afford to use it which is a big problem with the MA so-called health care reform. Actually, all MA has done is intimidate and coerce residents into purchasing policies that many can’t afford, nevermind being able to use the products.
Those who couldn’t afford to purchase insurance or didn’t want the Connector keeping track of their lives or to be subject to estate recovery or property liens have paid tax penalties they couldn’t afford and remain uninusred. Many in the subsidized plans are afraid to increase their income b/c they will be bounced to an different plan. This is regressive and oppressive.
MA has merely shifted costs around while keeping the same inadequate and profit-driven mess in tact, and this is the same thing that the national plan will do if it resembles the MA plan in any way, shape or form.
Unfortunately, our public servants haven’t been curious enough to seek the facts but prefer to take the word of BCBS reports, etc., or they are in the pockets of the health insurance industry. I believe it is a little of the first and more of the second.
So we will be sold down the river to the highest bidder unless someone in power grows a brain and realizes that this will be a huge mistake that will take this nation further down the road to ruin. It certainly will not help the economy unless they mean the economy of their friends in the industry.
Instead of using a system that works and is already in place – Medicare – and expanding it to cover everyone, we will end up with more of the same while a larger number of Americans will be worse off than before as is the case in MA. The MA plan was never about health CARE and neither are any of the current proposals with the exception of HR676 – Medicare for All.
We are about to become part of the biggest heist history has seen. It may be time to get out of this country if we want to live and die free.
Why is it not possible for us to have the same health coverage as our congressmen?
One of the potential benefits of universal health care is the potential that it will help our economy.
Sick people are not very productive as employees, small business owners or even as parents.
If through better preventative care, we keep more people healthy for longer periods of time, we stand to get back much more than any potential increase in our taxes.