That omission may have been due to a political decision, made by the state agents who commissioned the report, to exclude single payer from RAND’s remit. Whatever the cause of the missing analysis, that failure destroys the entire credibility of the RAND report.

The utter failure of the MA RAND report is easy to see in comparison with a recent study, conducted by the New York State Commissioner of Health and Insurance Superintendent. N.Y. Governor Mark Patterson requested the Commissioner to research and analyze which of several possible state health insurance reform proposals was the best means of providing quality, affordable health care to all New Yorkers.

Unlike the RAND report produced for MA, the N.Y. State Commissioner’s remit included single payer as a health reform option. The Commissioner’s findings were released on July 17, 2009.

And because Medicare For All was part of the analysis, the data forced the N.Y. State Commissioner of Health to conclude that Single Payer Medicare For All was the most effective and most cost efficient means of organizing the state’s health care system:

“The report found that savings from single payer substantially increase over time. By 2019, the Urban Institute concludes that single payer would save $20 billion annually based on the report’s projected 6% annual increase in baseline health care cost ($130 billion for single payer vs. $150.25 billion for present system). Single payer would cost $28 billion less annually than the public-private hybrid (e.g., expand public programs like Medicaid, a small public option, and a mandate to obtain insurance). The hybrid model had been a favorite of Governor Spitzer and his health care advisors.

“Single payer would also cost $19 billion less annually by 2019 than the NY Health Plus proposal by Assembly Health Committee Chair Richard Gottfried. NY Health Plus would automatically enroll all New Yorkers in Family Health Plus; however, employers could decide to opt out to purchase private insurances and a tax subsidy would be provided.

“A similar report by the Lewin Group for the State of California concluded that a state single payer system would reduce spending below projected levels by an average of $34 billion annually over a ten-year period. Studies done in five other states also found that single payer was the most cost-effective approach to universal health care.”

Let us compare the manifold benefits proven to result from a single payer, Medicare For All system to the likely results of “global budget” capitation through private insurers.

On July 29, 2009 the New England Journal Of Medicine published an analysis of the likely impacts of the the badly flawed RAND study proposals. NEJM noted that under the RAND global payment system funding would be directed by insurers to an patient’s ACO (e.g. doctors, nurses, etc.). Thus the insurers also would delegate to providers in the ACO the unpleasant task of denying care that is not within the patient’s budgeted capitation.

Further, the patient would not be allowed to be treated by providers outside of the ACO that previously denied coverage. The NEJM noted, “If all patients were restricted in this way … pushback is likely.”

The NEJM continued:

“[A]llowing a greater choice of hospitals, physicians and medicines to patients who were willing (and able) to pay more would undermine the cost-control, quality-improvement, and care-coordination purposes of global payments. Since patient choice is such a sensitive issue, the [RAND] commission waffled, recommending that ‘patients not be restricted (unless as a condition of their insurance contract) to providers in their primary care physician’s ACO” and that carriers “might continue to pay providers that patients might select from another ACO on a fee-for-service basis.”

For the MA Secretary of Health and Human Services to use the RAND report to force a change to global payment capitation will not solve the Commonwealth’s health care crisis. Rather, Ms. Bigby immediately should reject the RAND study, returning it to RAND with an expanded remit that includes Single Payer in its remit.

Thanks for this article and for pointing out the RAND report. I wish the emotional temperature of the national debate was reduced (if only there were such a thing as a political antipyretic).

Whether on the national or state level, the health care discussion ultimately centers around quality and costs. Our current system obscures those key aspects through legacy incentives of a bygone era which do not fit our current goals or capabilities.

I am proud to be a citizen in a state where frank and frankly difficult discussions about quality and costs are acceptable notions. This is not to say that the path to reform will be easy. However we can take solace in the fact that in the state of Massachusetts the discussion has a properly pragmatic framework.

I wish you the best in your continued efforts.
I will be digging through the RAND report shortly.

Thanks,
Evan Pankey
@epiStoic