Not News, But History - A New Look at Medicaid Expansion

                لمشاهدة الفيديو كامل HD 
              والتحميل مجانا

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Now that 2014 and Obamacare are both here, there will be plenty of stories about Affordable Care Act implementation.  Some will be newsworthy; but others will just be history. 

Last week, we got our first history story characterized as exploding news.

The Washington Post reported on a newly-released Harvard study that analyzed the impact of the 2008 Oregon Medicaid expansion on hospital emergency department visits.  The study found that there was a 40 percent increase in the number of emergency department visits made by the new Medicaid enrollees.

For the Post article, an MIT health economist (I guess no Harvard ones were available!) commented  that he viewed it “as part of a broader set of evidence that covering people with health insurance doesn’t save money,” something he went on to characterize as a “misleading motivator for the Affordable Care Act.”

And Forbes went farther, claiming the study results are “undermining [the] central rationale” for ACA.

But the Oregon expansion increase wasn’t really news by itself, and it tells us nothing about the Affordable Care Act, either.

There are three reasons for this.

The first reason is that Medicaid recipients, as a group, have always been the most frequent users of emergency department care. 

I learned about this up close when I was involved in a community health project in Austin, TX, more than a decade ago. 

We compared the use of emergency departments for non-emergent reasons by privately insured, Medicaid-insured, and uninsured residents.  About half the visits made by privately insured or uninsured people were for non-emergent reasons.  But 60 percent of those made by Medicaid recipients were for non-emergencies. 

The same thing was true when that analysis was repeated in other hospitals in other parts of the country.

So the new study simply confirms what we have known to be the case for years.  Medicaid recipients use hospital emergency departments for non-emergent care more frequently than those who are not on Medicaid.

The second reason is that we also know why Medicaid recipients have historically gone to emergency departments for their non-emergency care. 

It isn’t that emergency rooms are more conveniently located than private doctors and walk-in clinics.  Or that some hospitals now use billboards, texting, or other mass media to advertise shorter emergency department waiting times.

It is simply because – unlike many private primary care providers – hospitals have historically been paid enough to take part in the Medicaid system. 

But there are new realities under the Affordable Care Act.  More federally-qualified health centers are being approved, and other private primary care providers are seeing increased rates – rates comparable to Medicare – for treating Medicaid patients.

While change won’t happen overnight, this means that over time more private providers will be signing up for Medicaid in the expanded Medicaid program, and more Medicaid patients will be choosing them over hospital emergency departments because they can.

And that makes the results of an expansion program that took place six years ago an interesting history lesson, but as poor a predictor of what will happen in the future under a different set of rules as historical stock market performance is of future returns.

The third reason is that cost-savings was not a “misleading motivator” for supporting the Affordable Care Act.

Despite the suggestion of the MIT economist and the Forbes headliner, it wasn’t actually a reason at all.  When the Act was debated in 2009 and 2010, it was clear to all that it was essentially cost-neutral. 

Both the CBO and the Administration projected that we were going to be spending about the same amount on health care overall for the next ten years whether or not we passed the law.  But the law would distribute the costs and savings differently.

Medicare and Medicaid would take on a slightly greater share of costs.  Out-of-pocket costs not covered by public or private insurance would go down (especially for those with chronic diseases and conditions who could not afford insurance in the past).  And private insurance would continue to pay just about one-third of the nation’s health care bill.

While not everyone in the media may have known this at the time, all the people voting on the law did.

That’s not news.  That’s history.

Just like the new Harvard study.

Paul Gionfriddo via email: gionfriddopaul@gmail.com.  Twitter: @pgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.  LinkedIn:  www.linkedin.com/in/paulgionfriddo/

A CBO Full of Surprises: Obamacare Will Insure 2 Million Fewer in 2014

Obamacare will insure 2 million fewer people in 2014 than previously reported.  That number is in a new report just released by the Congressional Budget Office (CBO).

That may come as a surprise to you.  But it isn’t the biggest surprise in the report for me.  I’ll explain why later. 

First, let’s review the new numbers.

Last May, the CBO estimated that seven million people would sign up for insurance through exchanges this year.  That number is not a surprise – it has been reported widely in the media.

It also estimated that nine million previously uninsured people would be enrolled in Medicaid or CHIP.  In other words, a total of 16 million people would obtain coverage this year through Obamacare.

But last week, CBO released updated estimates.  It now says that only 6 million will sign up through the exchanges this year, and only 8 million will enroll in Medicaid or CHIP. 

Because some of the people who would have signed up are already insured, that means that the number of uninsured people will grow by 1 million over the CBO’s previous estimate.

Is that really a surprise?

It has been evident for some time that getting 7 million people to sign up for insurance through the exchanges was an ambitious target.  And the early glitches sure didn’t help.  But enrollments have been going much more smoothly lately, and reaching 6 million would still be impressive.

Also, taking into account the new enrollments in Medicaid and CHIP, the overall number of uninsured would still be reduced this year by 13 million.  That would reduce the total number of uninsured people from 58 million in 2013 to 45 million – halfway to Obamacare’s 2016 full-implementation target of 31 million.

That is still a pretty good result, and about what could have been expected.

And there is a little more good news on the fiscal side.  Lower enrollment numbers mean a little less spending for ACA each year, and in a program this big, that comes to $18 billion saved over ten years.

That would be enough to fund the prevention fund again, but I guess we shouldn’t go there.

So where’s the surprise?

The first is, of course, could be in the perception.  Much as the headline from the CBO report last week that Obamacare would cause the loss of over 2 million jobs was pretty surprising, another headline that it has fallen 2 million people short of its 2014 insured targets could be just as shocking. 

Of course, last week’s headline didn’t mention that the jobs “lost“ come about largely from among people who feel too sick to work, and who hold onto a job solely because they need the health insurance that comes with it.   The next headline may also not mention that the newly insured people also will come from among those who perceive that they need health insurance the most.

The second is also in the perception.  If Obamacare falls short of its targets, and those targets are recast as promises, then this will be perceived as another Obamacare promise broken.  People always seem surprised when they hear about politicians breaking promises, and they often make them pay at the polls.

But what may be the biggest surprise of all in the new numbers? 

It is this: that Obamacare is working almost exactly as it was intended, and appears to be having almost exactly the result that was intended. 

We are actually getting from the Affordable Care Act almost exactly what the President and Congress said we’d be getting way back in 2010.  And whether you like the law or not, this does suggest that members of Congress were a whole lot more knowledgeable about what they were voting for back in 2010 than most people give them credit for.

In other words, this law was put together out in the open.  The provisions in it were put together in a thoughtful way.  And those who made promises about what it would do were, in fact, telling the truth.  

And while a few of us may be surprised by how it has affected us personally, as a whole we all do know where we stand with this program.

I wish that were the case with all public policy initiatives. 

Paul Gionfriddo via email: gionfriddopaul@gmail.com.  Twitter: @pgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.  LinkedIn:  www.linkedin.com/in/paulgionfriddo/

Malice in Wonderland

As we gaze this week at the wonderland we call Congress, it might amaze us that Congress actually shut down the federal government over the implementation of the Affordable Care Act.

Rep. John Culberson of Texas grinned like a Cheshire Cat as he explained it this way in an outlandish interview on CNN, “we do not want the federal government socializing health care as they have in England and in France.”

This is socialized medicine?  Really?

He wasn’t content to leave it there, adding a new “sacred” right to the Constitution to explain further his position.

“The right to be left alone as Americans is probably our most important right.”

As the Mad Hatter would say, “Why, you might just as well say that ‘I see what I eat is the same as I eat what I see.’” 

But Representative Culberson was on a roll.  Literally.  This was two days after he was reported to have shouted “let’s roll!” as House Republicans concluded a caucus in which they re-affirmed their intent to shut down the government if Obamacare weren’t defunded. 

He explained that he was invoking the memory of the 9/11 heroes who brought down the airplane in Pennsylvania that was headed to Washington.  Was the irony lost on Representative Culberson?  That plane was in all probability heading toward the Capitol, and the heroes who brought it down may not only have kept our government open that day, they may have saved Representative Culberson’s life, and the lives of many of his colleagues.

Meanwhile, as Representative Culberson – a House member since 2000 – was giving his interview, some really bad things were happening to Americans hoping for an end to the economic quagmire he helped to create.

The Dow was shedding 129 points in anticipation of the shutdown.  In the last week, U.S. companies lost about $200 billion in value – more than the combined value of every company in Poland.

And we have had to suffer through all this because giving a $6000 tax credit to families earning $50,000 per year who purchase their own private health insurance is too “socialist” for Culberson.

I believe in our government.  I believe it is there to protect our actual rights (not ones Representative Culberson invents) and to work toward the common good.

And I am bothered because there is no charity in Representative Culberson’s view, only malice.

Toward the people who are helped most by Obamamcare – people with serious mental illnesses and other chronic conditions, lower-income workers, and uninsured people, for sure.

And toward the President on a disturbingly personal level, too – because this shutdown is not really about debt or deficit either.

Does anyone really think that if Ronald Reagan – not Barack Obama – were to be magically transported down a rabbit hole to the presidency today, then Representative Culberson would be saying the same things?

Five years into Reagan’s presidency, our national debt, which would triple during his term, was up over 100 percent – more than it has grown during Obama’s presidency.  Our federal deficit had grown from $74 billion to over $212 billion.

Medicaid was being transformed from a mostly long term care program for elders to a safety net health insurance program for families.  By 1988, eligibility was increased to 185% of poverty for pregnant women and children and even more for some through the Katie Beckett waiver.  These are far more generous than the 138% of poverty level Obamacare established for adults with chronic conditions.

Before he left office, piled on top of all that debt, Reagan even proposed the bare outlines of much of what became the Affordable Care Act.

He asked Congress to include catastrophic insurance, limiting out-of-pocket costs to $2,000, for every American covered by Medicare – along with a $60 a year increase in premium to pay for it.  He proposed a federal/state partnership to promote the formation of state-based risk pools to provide insurance for those who could not obtain it.  He called on states to mandate enhanced employer-based health insurance coverage.  And in his February 1987 radio address calling for all of these things, he said that the federal government should work with the private sector to promote public education about the choices and options available.

Representative Culberson was serving his first term in the Texas House of Representatives in 1987.  Do you imagine he – one of only two sponsors of legislation to put Ronald Reagan’s image on the $10 bill- favored a government shutdown to prevent Reagan’s “socialized health care?”

Paul Gionfriddo via email: gionfriddopaul@gmail.com.  Twitter: @pgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.  LinkedIn:  www.linkedin.com/in/paulgionfriddo/

Will Obama's Bold Vision End the Myth of Entitlement Reform?

As President Obama begins his second term, he does so with an expansive vision for America.

“America's possibilities are limitless,” he said in his inaugural address, “for we possess all the qualities that this world without boundaries demands:  youth and drive; diversity and openness; an endless capacity for risk and a gift for reinvention.   My fellow Americans, we are made for this moment, and we will seize it - so long as we seize it together.”

There are many potential roadblocks toward achieving that bold vision.  One is the myth that entitlement reform must be a part of it.

The reason that entitlement reform is at the top of some political agendas has nothing to do with the growth in entitlement programs today.

Some people with these agendas don’t like any government-run programs and won’t listen to the facts about them. 

Those who do look at the facts see the rapid growth in Medicare and Medicaid spending through 2009.  According to the Center for Medicare and Medicaid services, Medicare spending increased by an average of 10.9 percent per year between 1967 and 2009, and Medicaid spending by an average of 10.7 percent per year between 1975 and 2008.

They believe that this rate of growth is not sustainable.  But since the beginning of President Obama’s first term, we haven’t sustained a growth rate even close to this.

A report from last September and two more reports released in the last couple of weeks – one from the Department of Health and Human Services (HHS) and another from the Bureau of Labor Statistics (BLS) – show just how far the myth is from today’s reality.

The new HHS report found that per capita Medicare spending increased by just four-tenths of one percent in 2012, following increases of only 3.6 percent in 2011 and 1.8 percent in 2010.

And according to some new BLS data, the overall medical inflation rate last year – which should tell us something about Medicare and Medicaid growth in the coming year – was 3.2 percent. 

There is a much more immediate health spending problem about which policymakers should be worried – one that entitlement reform could make worse. 

High health costs may burden state and local governments.  But they burden people who rely on Medicare and Medicaid far more.

In an article entitled the High Cost of Out-of-Pocket Expenses published in September by the New York Times, Judith Graham summarized from a third recent study.  The study found that during the last five years of life:

• People on Medicare spend $38,688 on medical costs.
• People with Alzheimer’s spend $66,155. 
• The top quarter of spenders spend a whopping $101,791.

Some policymakers love talking about the unfairness of the “death tax.”  How about the unfairness of this hidden “pre-death tax” that gets bigger every time elected leaders cut entitlement spending? 

Entitlements are not the problem.  The cost of health care is.  Entitlements are – and always have been – the solution to the problem of a middle class forced into poverty by high health care costs near the end of life. 

And while entitlement reform may reduce government expenditures, it will only do so at the expense of those who need Medicare and Medicaid the most.

President Obama said it well in his address. 

“We must make the hard choices to reduce the cost of health care and the size of our deficit.  But we reject the belief that America must choose between caring for the generation that built this country and investing in the generation that will build its future.  For we remember the lessons of our past, when twilight years were spent in poverty, and parents of a child with a disability had nowhere to turn.  We do not believe that in this country, freedom is reserved for the lucky, or happiness for the few.  We recognize that no matter how responsibly we live our lives, any one of us, at any time, may face a job loss, or a sudden illness, or a home swept away in a terrible storm. The commitments we make to each other - through Medicare, and Medicaid, and Social Security - these things do not sap our initiative; they strengthen us.  They do not make us a nation of takers; they free us to take the risks that make this country great.”

Contact Paul Gionfriddo at gionfriddopaul@gmail.com. Twitter: @pgionfriddo.  LinkedIn: www.linkedin/in/paulgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.

In the Fiscal Cliff Deal, A New Push for Long Term Care in 2013

When the House of Representatives voted by a comfortable margin a few hours ago to approve the American Taxpayer Relief Act (ATRA) and step away from the "fiscal cliff" for another two months, it agreed to two Senate provisions affecting elders and others with long term care needs.

The first was the "doc fix," which prevented a nearly 30% cut in Medicare payments to physicians.  This was important.  If it hadn't happened, doctors would have fled the Medicare program.

The second was tucked away into Section 643 of the Act.  It establishes a new 15-member Commission on Long Term Care, replacing the CLASS Act provisions of the Affordable Care Act that are now finally, formally repealed by ATRA.

The Commission could turn out to be a very big deal if it does it job well, because it could lead the way in changing our system of providing and financing long-term care in America.

The Commission is charged with writing a bill over the next six months "to establish a plan for the establishment, implementation, and financing of a comprehensive, coordinated, and high-quality" long term care system for elders, people with cognitive impairments, people needing help performing activities of daily living, and all "individuals desiring to plan for future long term care needs."

The Commission will focus on three things:

• the interaction and coordination of new services with Medicare, Medicaid, and private long term care insurance;
• improvements to Medicare, Medicaid, and private long term care insurance needed to ensure availability of long term supports and services; and
• long term care service workforce needs.

If the Commission completes its work on time, it could mean the introduction of new long term care legislation as early as the fall of 2013.

What could this legislation mean for us?

It could be the first step on our nation's long and necessary path to bring long term care costs under control, and make long term care services available to individuals without first impoverishing and exhausting them or their families.

It could also help states bring Medicaid costs under control, and the federal government better manage Medicare costs, too.  Long term care costs are the real culprits in rising Medicaid costs for state budgets and state taxpayers.

Let's keep our eyes open, and hope for two things.  First, that this new Commission does a better job fixing our nation's long term care problem than our broken Congress has done with the Fiscal Cliff.  And second, that if it does bring some recommendations forward, Congress listens.

This column is an Our Health Policy Matters extra.  Read on below for this week's regular column.  Follow Paul Gionfriddo on Twitter @pgionfriddo.  

The Top Health Policy Stories of 2012

Health and mental health policy stories dominated 2012.  From how the Affordable Care Act framed the health policy debate at the start of the year to how the Sandy Hook tragedy framed the mental health and public health debate at year’s end, 2012 will go down in history as the most significant year in health policy since the 1960s.

Here are summaries of a few of the biggest news stories.

The Supreme Court Decision on the Affordable Care Act.  Nothing quite compares to the drama of the day in June when the Supreme Court ruled the Affordable Care Act to be constitutional.  Few people guessed right in advance that the decision would come down to finding the “individual mandate” to be constitutional because it is a tax, but mandatory Medicaid expansion unconstitutional because it tied future federal funding for the existing state Medicaid programs to the Medicaid expansion.

People on both sides of the debate came away wanting more, and states reluctant to accept the decision waited months to see if the fall election would change the policy environment.  It didn’t.  So as the year drew to a close was whether they, or the federal government, would implement the insurance exchanges.

The Debate over the Future of Medicare.  In the campaign, we all learned more about the two major parties’ competing visions about the future of Medicare.  The Democrats want the current structure of the program preserved; the Republicans would like to make the current Medicare program just one option available to seniors among a variety of private health insurance plan choices.

When the dust settled, the Democratic vision had carried the day.  Nevertheless, Mitt Romney’s supporters argued afterwards that he actually “won” the Medicare debate when he took a majority of the vote of senior citizens.  But even that “victory” may have resulted from the fact that he opposed the $716 billion cut.

Meanwhile, a little compromise is all we really need to preserve Medicare – but not the increase in the age of eligibility policymakers have recently pushed. 

The Medicaid Expansion.  The governors of seven southern states declared in the summer that with Medicaid expansion now an option, they weren’t planning to implement it.  They cited the significant cost of doing so.  Florida, for example, said it would cost $351 million a year, and Texas trumped that with a $4.4 billion price tag. 

But by the end of the year those states were faced with the fact that it will be at least 9 times more expensive not to expand the program.  Not embracing the expansion would cost Florida at least $3.2 billion and Texas $39.6 billion in annual lost federal revenue. 

That’s a lot of money to turn down – especially when the alternative is asking state taxpayers to foot the bill.

The Cuts to State Mental Health Services.  As of 2012, the tally of state budget cuts to mental health services grew to $4.6 billion over the past four years, with no end of cutting in sight.  I wrote about the real-time effects of these cuts in Anna Brown’s Death, California Screaming, the Mental Health Policy Mistakes We Make and the Sons and Daughters Who Pay for Them, and, focusing on veterans, in Iraq and Back and Answering the Call. 

There’s a depressing bottom line to all these stories: people with mental illness got lip service or worse. 

Athletes – and Others – Dying Young.  When Pro Football all-star Junior Seau died in the spring, it revived talk of the Curse of the 1994 San Diego Chargers. He was the 8^th member of that team to die before turning 45.  Were these deaths the cumulative effect of concussions? Or related to long-term side effects of performance-enhancing drugs that ruined the legacy of Lance Armstrong and a host of steroid-era baseball superstars, like Mark McGuire, Barry Bonds, Sammy Sosa, and Roger Clemens?

Not exactly.  At least in the case of the ’94 Chargers, former professional athletes weren’t dying young from concussions or performance-enhancing drugs, but for many of the same reasons – accidents, obesity, heart conditions, and complications from diabetes – non-athletes die young, too.  It’s avoidable, but not when we cut $5 billion from public health as we did this year.

Sandy Hook.  We need to say it again. Violence is a public health problem, not a mental health problem.  If we learn nothing else from tragedy, I hope it will be these three things: anyone of us could be a victim of violence; we can prevent much of it by treating it as a public health problem; and blaming people with mental illness for the increase in violence in America will only lead us down a dark path.

I wish you all a safe, peaceful, and Happy New Year. 

Secession Fever

There’s a new disease this year along with the winter flu.  It is called Secession Fever. 

Secession Fever has reached epidemic stage across the south.  As of Monday, there were more than 25,000 cases in each of eight southern states – North Carolina, South Carolina, Georgia, Florida, Alabama, Tennessee, Louisiana, and Texas.  A ninth, Arkansas, had over 23,500.  Collectively, these states had almost 402,000 cases, and the number was still growing.

Secession Fever is a self-reportable disease.  People who have it signed a petition on the White House website.  Secession Fever is characterized by the irrational belief that the federal government does more harm than good, and that states would be better off if they seceded from the Union.

So what if these nine states did secede and form a new Southern Confederacy?  Would their citizens be better off?  Some data from the Kaiser Family Foundation and the Central Intelligence Agency suggest not.

In forming the Southern Confederacy, approximately 86 million people would find themselves living in the 14^th most populous country in the world, just behind Vietnam.  (The rest of the United States would drop from 3^rd to 4^th in population, trading places with Indonesia.)

They would find themselves worse off than they think they are.

The percentage of people living in poverty in the Southern Confederacy would be 17 percent, comparable to that in Trinidad and Tobago, Jamaica, and Turkey.  Meanwhile, the percentage living in poverty in the remaining United States would drop to 14 percent, comparable to the rate in the United Kingdom.

Life expectancy in the Southern Confederacy would also take a hit.  It would decline immediately to 77.7 years, 61^st in the world and comparable to life expectancy in Libya.  In the remaining United States, it would be almost 79 years.

That’s not all.  The health status of Southern Confederacy citizens would decline, too.

One in five residents in the Southern Confederacy would be uninsured, versus only 14 percent in the remaining United States. 

Even that high percentage would grow dramatically without the federal Medicaid and Medicare programs.  Without the federal share of Medicaid dollars, the percentage of uninsured in the Southern Confederacy would grow by at least 9 percent more, to close to 30 percent.  And without Medicare providing insurance for 16 percent of its population, the Southern Confederacy’s uninsured rate would approach 50 percent, killing off nearly every hospital and long term care provider.

Infant mortality would go up, too. 

For every one million births, 1100 more babies would die in the Southern Confederacy than in the remaining United States.  The infant mortality rate in the Southern Confederacy would be 7.5 per thousand – comparable to that found in Chile.

Disease prevention would also take a hit. 

The percentage of overweight adults in the Southern Confederacy would be over 65 percent, pushing ever higher the prevalence of diseases like diabetes, hyperlipidemia, and hypertension.

Public health would suffer, too.  The AIDS rate would grow, and the proportion of people infected with HIV in the Southern Confederacy would be similar to that found in Somalia.

Mental health services would not be spared, either. 

Nationally, we currently spend around $120 per capita on mental health services.  But in the Southern Confederacy, state mental health spending would be half that – just $61 per year.

It isn’t that people in the Southern Confederacy have better mental health status and need fewer services.  Just over one-third report being in poor mental health, just as in the rest of the country.  They’re just more likely to be ignored, neglected, or maltreated.

If there were ever a compelling argument for why we need a strong federal government, life in the Southern Confederacy is it.

Aspiring to the health standards of Somalia, Chile, Libya, Trinidad and Tobago, Jamaica, and Turkey – all nations with much to offer, to be sure – is hardly the stuff of “American Exceptionalism.”  But these nations turn out to be the real role models for those with Secession Fever.

These harsh health conditions reflect the realities of life in these southern states today.  We can argue that we can do better than this, but not if we can’t accept this reality – people are worse off in these states than in the rest of the United States.

Those with Secession Fever – and the political leaders who have fanned the flames of anti-federal sentiment for years – must be living in an alternate universe.

If you would like to schedule Paul Gionfriddo to speak to your group or organization, please email gionfriddopaul@gmail.com.

The Rule of 9 and the ACA Medicaid Expansion

There’s a simple way to calculate just how much a state will save in the long term by expanding the Medicaid program under the Affordable Care Act.  Just multiply whatever it says it will cost by 9.

That’s because the federal government will contribute at least $9 worth of match for every dollar a state spends on Medicaid expansion.

By now, we’ve all heard just how big some of the match numbers will be.  Based just on the estimates provided by the state itself in its January 2012 Supreme Court brief, Florida, for example, would gain at least $3.2 billion annually.

But Florida’s Governor has openly fought the expansion until recent weeks, and has yet to say whether or not he will support it in any form. 

He’s not the only one.  A weekend article in the Washington Post reported that as many as thirteen states may be leaning against the expansion, versus 17 plus the District of Columbia that are pursuing it.

According to the analysis on which the article was apparently based, the governors of 8 of the 13 anti-expansion states have recently reiterated their opposition to the expansion.  These include six – Georgia, Louisiana, Mississippi, Texas, South Carolina, and Oklahoma – that have been in the “rejection” category since the summer, and two –Maine and Alabama – whose governors added their states to the rejecting list in mid-November.

These governors typically cite the cost of the expansion as the reason to reject it.

However, a report released last week by the Kaiser Family Foundation took a close look at these costs over the next ten years and came to a different conclusion.  During a decade when the federal match will range from 90% to 100% for newly covered populations, the first column in the table below represents the incremental cost of the expansion over ten years for each of the eight current rejecting states.  And the second column represents the increased federal revenues each state will receive if it changes its mind:

Alabama             $1.1 billion          $14.3 billion

Georgia               $2.5 billion          $33.7 billion

Louisiana             $1.2 billion          $15.8 billion

Mississippi          $1.0 billion          $14.5 billion

Texas                  $5.7 billion          $55.6 billion

South Carolina   $1.2 billion           $15.8 billion

Oklahoma           $689 million        $8.6 billion

Maine                 ($570 million)      $3.1 billion

That comes to over $160 billion in lost revenue to these eight states alone.

Those lost billions represent money that will reimburse hospitals, nursing homes, community health centers, doctors, nurses, and behavioral health providers for care they will have to provide anyway.   

It’s especially hard to imagine what the Governor of Maine could be thinking.  Its $3.1 billion in new federal Medicaid revenue would actually be accompanied by a reductionin state Medicaid spending over the next ten years. 

The same is true in Connecticut, Delaware, Massachusetts, New York, Hawaii, Maryland, Iowa, Vermont, and Wisconsin.  With the exception of Iowa and Wisconsin, the others are all – logically – working toward expansion.

By the rule of 9 alone, it would seem that Medicaid expansion would be as close to a policy no-brainer as a state could get.

But just as there is a reason beyond the headlines why some states are reluctant to embrace setting up state health insurance exchanges under ACA, there is a reason why they don’t want to expand Medicaid, too.

It is because – just as in the case of rejecting ACA health insurance exchanges – states that are thinking of rejecting the Medicaid expansion just don’t do a very good job of protecting the health and mental health of their population.

On average, the thirteen states embracing the Medicaid expansion rank just under 17^th in the Best States for Your Health ranking, while the eight current rejecting states rank 39^th– a huge difference despite the presence of Maine, ranked 8^thoverall, on the rejecting list.

And on average, the thirteen states embracing the Medicaid expansion currently average 20^th overall in spending on mental health services, while the rejecting states together average 36^th. 

Some state governors saying no to expansion claim that the reason is because they are worried that the federal government will someday cease to fulfill its end of the bargain to pay 90% of the costs. 

But what I think they are really communicating is something else.  They personally reflect the view that health and mental health are not priorities in their state.  And they still hope to elect more people like them to Congress in the coming years to kill the expansion.

It’s cynical to hope for this, and it won’t happen.

President Obama's New Health Policy Road

Newly re-elected President Barack Obama may now have a new road to health policy-making after three years of defending the Affordable Care Act.  And even if the Congress does nothing to help in the months to come, his road may be a whole lot easier than it has been.

Even with the Affordable Care Act in place, our health policy debate has been dominated by the belief that health care Armageddon is just around the corner.

But some recent data suggest that Armageddon may still be down the road.

Just how far may well determine how our health policy debate shakes out over the next two years.

First, let's look at the Armageddon scenario.

The candidates accepted the scenario that health care costs are out of control when they made the future of Medicare and Medicaid a centerpiece of the campaign.  Governor Romney’s proposed solution was to clamp down on federal funding for these programs.  President Obama advocated managing state and local costs by expanding the federal role in both programs.

But neither strategy leads to lower projected Medicare and Medicaid spending in the near future.  Both will become trillion dollar programs in the next few years.  There’s no turning back; this is already written in stone as the baby boomers age.

The $716 billion Medicare rate cut in both the Affordable Care Act and the Ryan Budget will help.  But it won’t be enough to stop Medicare from growing to 6% of GDP over the next generation.  And at least part of that cut – the physician payment cut – is likely to be overturned by the new Congress. 

So if policy leaders want to save Medicare, they will have to do more.  But there is no consensus about what this should be.

Medicaid spending is even more contentious, because the program is so expensive for the states. 

Romney’s solution – to change it to a block grant – only addressed this problem on the surface.  This is because the increase in projected Medicaid costs represents the actual projected costs of the actual projected Medicaid-eligible people using today’s eligibility standards. 

To put this more simply, there will be a trillion dollar bill to pay, no matter what.  Block grants will only change who pays that bill. 

Obama’s choice – to have this burden shouldered equally by everyone through the federal government – will help states immensely, but won’t make the program any cheaper.

The cost of healthcare for returning veterans will also drive health care costs upward during the next few years. 

In 2010, the CBO estimated that this could mean another $30 billion in VA spending over what we are paying today.

In this Armageddon scenario, all the pressure on governmental health care spending pushes upward.  And we have no clear policy solutions.

Limiting the growth in Medicare spending to 5% per year, instead of 5.7% is something for which most of the members of both parties have voted during the last two years.  That is already in place through the Affordable Care Act, and one potentially bipartisan option. 

But we need to go much lower than this to reduce the GDP burden of health care, and more aggressive rate-setting and regulation may do irreparable harm to certain safety net providers.

So President Obama’s hands may be tied – unless our healthcare future is tied to the second scenario.

In this scenario, healthcare inflationary growth declines rapidly.  And the information from 2010 and 2011 suggests that this is exactly what is happening.

Health care inflation was under 4% per year for two straight years in 2010 and 2011 for the first time in fifty years.  This may well have been recession-related.  But if health inflation stays low for even a little while longer, this will change the trajectory of health spending projections for years to come.

That may be why President Obama and Vice-President Biden made this a centerpiece of their campaign message in the closing weeks of the campaign. 

Even if the new Congress does nothing, low inflation changes the health policy picture dramatically.

Low health care inflation will add years of life to Medicare, absorb the 2.8% projected increase in state Medicaid spending attributable to the Medicaid expansion, and eventually drive down the price of health insurance even as Affordable Care Act consumer protections remain in place.

That puts the President in a position of strength for the next two years.  President Obama just won a tightly contested re-election.  The next few months will decide with just how easily his health policy agenda moves forward now.

Why ACA Has Become Politically Irrelevant in the 2012 Campaign

Why did the health care debate in this year’s election campaign pivot so quickly from the Affordable Care Act to Medicare?

It may well be because of this:  While people still feel strongly about ACA, they don’t really see it as relevant to them.  But Paul Ryan made Medicare relevant to everyone when he proposed changing the program for the under-55 population.

Some new data from the U.S. Census Bureau may explain why most people don’t see ACA as relevant to them.

We learned this month that the number and percentage of people without health insurance changed modestly in the year after ACA passed.  The number of uninsured people went from 50 million to 48.6 million.  The percentage of uninsured decreased from 16.3 percent to 15.7 percent.

These changes were small, as were some others.  The percentage of people with employer-based insurance decreased slightly, from 45.7% in 2010 to 45.1% in 2011, and the percentage of people who purchase private insurance directly remained the same, at 3.6%.

Despite rumors of a “government takeover” of health insurance, government programs also experienced modest changes.  The Medicaid population grew from 48.5 million, or 15.8% of the population, to 50.8 million, or 16.5%.  Medicare recipients grew by 2 million, from 44.9 million people (14.6%) to 46.9 million people (15.2%).   

And the populations experiencing the biggest gains because of ACA aren’t very big when compared to the population as a whole.

• Nearly 3 million young adults under the age of 26 are covered on their parents’ insurance plans as a result of ACA, but they represent less than 1% of the population – and some were already on their parents’ plans before ACA passed because they were still in school.
• Approximately 3.6 million Medicare donut hole recipients saved drug money in 2011 because of ACA, but they also represent only about 1% of the population – and they were already on the Medicare program anyway.
• 4.5 million early retirees remained on employer plans after ACA – but many of these had been on those plans anyway; it was the plans that became eligible for financial relief under ACA.
• Approximately 13 million people got insurance rebates because of ACA in 2012, but many of those rebate dollars were credited to employers, not to individuals.  Perhaps another 1% of the population – one third of those covered by individual insurance only – actually received the full value of the rebate in the form of a check.

These numbers are just big enough to elicit a yawn from more than 95% of the population.

And most of us may keep yawning in the future.  According to 2012 data from the Center for Medicare and Medicaid Services, the percentage of our nation’s health care bill paid by private insurance in 2011 was 34%.  The percentage private health insurance will be paying in 2021, after ACA is fully implemented, will be 33%.

Just as ACA changed the political landscape in 2010 because of how much people worried about what it might do, it may have little effect in 2012 because of how much it hasn’t done.

And even after ACA is fully implemented in 2014, many of us might not notice.  Up to 30 million uninsured people may gain insurance – an extraordinarily significant number – but they still represent less than 10% of the population.

When you add it all up, here is one way to quantify the change to which we can look forward.

Out of every 20 people today, 9 have employer-based insurance only, 1 has individual insurance only, 3 are on Medicare (sometimes in combination with Medicaid), 2 are on Medicaid alone, 1 has another type of government plan, 1 has a combination of coverage, and 3 are uninsured. 

When ACA is fully implemented, in that same group of 20 the number of people purchasing insurance directly will eventually increase from 1 to 2, the number on Medicaid will increase from 2 to 3, and one will still be uninsured.

That’s it.

That’s why the campaign debate has pivoted to the future of Medicare.  

When Paul Ryan proposed making changes to Medicare that affect the under-55 population and when Mitt Romney chose him was his vice-presidential candidate, they took a program that until now has mattered mostly to the 55+ population (Medicare and near-Medicare recipients) and made it relevant to everyone.

And just like that, the political landscape shifted.

If you have questions about this column or wish to receive an email notifying you when new Our Health Policy Matters columns are published, please email gionfriddopaul@gmail.com.

Haley Marie is Born

I am writing this column just a few hours after the birth of my second grandchild, Haley Marie.  Haley Marie looks like her father.  She is long and thin, and she is going to be very pretty when she is older.

Our first grandchild, Noah, was born four months ago.  He’s in the 5^th percentile in weight, and my wife and I joked that it would be hard for Haley to beat that when she came along.

She did.  She weighed in at two pounds and eleven ounces, which means that, according to the Annie E. Casey Foundation Kids Count project, she is one of the 1.5% of all U.S.  babies who are born each year at “very low birth weight,” or less than 1500 grams (3 pounds, 4 ounces). 

So Haley Marie will spend her first days in a hospital neonatal intensive care unit. 

Haley is fortunate.  She was beyond thirty-two weeks of gestation.  Her Apgar scores were stellar.  She is strong and has good lungs.  I can also offer direct testimony that she is alert and responsive to light.  I learned this when I snapped a picture of her at five hours without turning my camera flash off!

But not every baby born at very low birth weight gets off to as good a start as Haley.

We all say we care for babies, but here is something we don’t like to mention:  low birth weight babies have a higher risk of dying.  Very low birth weight babies have a 24% chance of dying during their first year of life.

I’m a worrier by nature.  So statistics like this have always worried me.  Even before there were children and grandchildren in my life back when I was a state legislator, I stressed constantly over how to help reduce our too-high infant mortality rates.

Prevention and good prenatal care are answers.  But sometimes – as in Haley’s case – a baby is born at low birth weight even though her mom has taken good care of herself during pregnancy and received high quality prenatal care.

Neonatal intensive care, thankfully, is another answer.  But neonatal care is expensive. 

In 2005, the Institute of Medicine found that most of the $26 billion annual cost of premature birth  - or over $51,000 per child – was for neonatal intensive care.  Haley’s parents can’t afford this, nor could most of us.

Thank goodness we have insurance to pick up the slack.  But relying on private insurance to pay our neonatal intensive care bills is a double-edged sword.  Insurers often charge hefty co-pays, and the amounts can change unpredictably.  As Michelle Andrews pointed out in an article in Kaiser Health News in January, 2011, “fewer parents-to-be realize that they may be in for a nasty surprise if their baby is premature or for some other reason needs special care immediately after birth: The neonatal intensive care unit (NICU) personnel at their in-network hospital may be out-of-network.”

Here’s something that may offend some people, but I’m going to write it anyway:  Relying on private insurance alone to pay for health care is too big a gamble when children’s lives are at stake. 

It’s a good thing many children have the security of a public option, too.  Shame on the politicians who say they have a problem with this, and want to roll back or block grant Medicaid or SCHIP funding at Haley’s expense.

They have never walked in her tiny shoes; I hope they never even have to walk in mine.

The NICU providing care to Haley today was also built in large part through the investment of hundreds of millions of taxpayer dollars beginning fifty years ago.  I’ve lost faith that the “tax cuts at all costs” politicians of today would have the backbone to launch a similar project.

And for this Haley’s granddaughter could someday pay a price.

As a group, children born at very low birth weight face more challenges as they grow up.  According to Child Trends, they are more likely to have chronic health conditions and developmental delays.  They are also more likely to need special education services.  They are at greater risk of dropping out of school, and have lower earnings potential.

I’m not going to think about all this today, however.

Haley, I am sure, will be just fine.  So I’m just going to celebrate the miracle that is her life.

And acknowledge with gratitude the governments that protect us all, especially those, like Haley, who are most in need.

If you have questions about this column or wish to receive an email notifying you when new Our Health Policy Matters columns are published, please email gionfriddopaul@gmail.com.

Please Vote for the Mental Health Association of Palm Beach County in the Chase Community Giving Campaign before Sept. 16th.  It just takes a couple of minutes to help win dollars for programs that prevent mental illness in children.  Click here to vote http://bit.ly/VoteMHA

Paul Ryan's Magical Thinking

A Medicare exchange in which private plans compete with a public option?  A Medicaid program unshackled by federally determined program requirements and eligibility criteria?

Now that Governor Romney has chosen Rep. Paul Ryan as his running mate, these new visions of Medicare and Medicaid will become part of the health policy debate in every state.

They are both part of Vice-Presidential candidate Ryan’s now-famous Path to Prosperity proposal published earlier this year.

In his vision, Ryan attacks an “open-ended, blank-check” Medicare subsidy that in practical terms means a government that will pay providers what it costs to treat diseases even for the most expensive seniors. 

In his own words: 

“Medicare subsidizes coverage for seniors to ensure that coverage is affordable.  Affordability is a critical goal, but the subsidy structure of Medicare is fundamentally broken and drives costs in the wrong direction.  The open-ended, blank-check nature of the Medicare subsidy drives health care inflation at an astonishing pace, threatens the solvency of this critical program, and creates inexcusable levels of waste in the system.” (p. 48)

In his new Medicare program – which would apply to everyone under the age of 55 – Medicare would no longer be a government-run insurance program for all. 

Instead, it would be transformed into a voucher system, in which every person at the age of 67 would be given a certain amount of money to spend making a choice among “private plans competing alongside the traditional fee-for-service option on a newly-created Medicare exchange.” 

Ryan envisions that “all plans, including the traditional fee-for-service option, would participate in an annual competitive bidding process to determine the dollar amount of the federal contribution.” 

Here’s the most important part.  The plans with the best coverage won’t determine the amount of the 

Medicare subsidy.  Instead, the second-cheapest plan would; Medicare beneficiaries would be responsible for anything above this.

There’s more.  The Medicare subsidy payment would also have a “hard cap” of no more than one-half of 1% more than GDP.  If medical inflation were higher than that – as it is nearly every year – the Medicare recipient would pay the difference.

From a consumer perspective, Ryan’s Medicare exchange will be like the Affordable Care Act’s health exchange on steroids – except that it will still have a public option.

It will save the federal government money in direct care subsidies, but not through medical cost containment strategies like capping rates.  Instead, it fills in a number on the formerly blank check sent to seniors, and if this number is too small makes seniors responsible for rationing their own care. 

And if higher out-of-pocket costs aren’t enough, those seniors will also have to spend 15% or more of their payment on the administrative costs and profits of the private insurance plans they will now be offered. 

Finally, none of this comes without added federal bureaucracy.  Because the existing Medicare bureaucracy – which has little fat in it – will still be needed to manage the public option, the government will need to grow a new Medicare bureaucracy to manage and regulate the Medicare exchange.

It is magical thinking to believe that an approach that shifts costs to seniors, skims dollars for new bureaucracies, and has no direct health care cost containment features will result in better care at a lower cost.

Current seniors may be breathing a sigh of relief after considering all this, knowing that Ryan preserves Medicare as we know it for everyone over the age of 55.

But it’s too soon for a victory dance.  The biggest health care challenge a good portion of the 55+ group faces is how to pay for long term care.  Ryan has $810 billion of cuts over ten years in mind for the Medicaid program on which they will rely.

He wants to reform Medicaid “by converting the federal share of Medicaid spending into a block grant indexed for inflation and population growth…. States will no longer be shackled by federally determined program requirements and enrollment criteria.”

In other words, if a state chooses not to cover nursing home “room and board” or name-brand pharmaceuticals to absorb its portion of the $810 billion cut, it won’t have to. And if it chooses to count all of the non-institutionalized spouse’s income and assets toward the Medicaid eligibility of an institutionalized spouse, it will be allowed to.

Ryan is right that we need a debate about the future of Medicare and Medicaid.  He is wrong, however, in believing that reducing benefits can happen without pain.

Our Health Policy Matters published early this week because of the selection of Paul Ryan as Mitt Romney's running mate.  It will return to its regular publication schedule next week, with a new column on Wednesday, August 22.

Denying the Inevitable

If 243 members of Congress knew that they were going to develop Alzheimer’s Disease or related dementia, would it change the way they make Medicaid and long term care policy?

Or would they continue to deny the inevitable?

When Congress convened in 2011, the average age of a House member was 57, and the average age of a senator was 62.   They were approaching the prime years for dementia.

If you don’t already have Alzheimer’s Disease or related dementia by the time you turn 65, then your chances of developing it between the ages of 65 and 74 are greater than one in 20.  Your chances of developing it between the ages of 75 and 84 are almost one in 7.  And after that your chances of developing it are one in 4.

At today’s prevalence rates, 28 members of Congress will develop dementia between the ages of 65 and 74, 91 between the ages of 75 and 84, and 124 later on.

The only thing that will change this trajectory is if they die sooner of something else.

If I were a younger elected official today, this might get might attention, and it also might get my attention that the number of people with dementia will increase from 5.2 million today to at least 11 million during my lifetime.

Representative Aaron Schock of Illinois and Senators Mike Lee of Utah and Marco Rubio of Florida all fit this bill.  They were the youngest members of their respective chambers (at 39, Senator Lee was a week younger than Senator Rubio), and they had remaining life expectancies of at least 40 years. 

So while we might forgive 87-year old Representative Ralph Hall of Texas and Senator Frank Lautenberg of New Jersey if they feel they don’t always have the luxury of taking the long view in policy-making, we should wonder a little more about Senators Lee and Rubio and Representative Schock.

They are all likely to be around when the fruits of their recent healthcare work ripen over the coming decades. 

And they may find some of them especially bitter.  

According to the Alzheimer’s Association publication 2012 Alzheimer’s Disease Facts and Figures, the cost of caring for people with Alzheimer’s Disease and other dementias – in today’s dollars – will increase from $200 billion to $1.1 trillion per year by 2050.

These $1.1 trillion are not inflated by forty years of GDP growth or the increased costs of medicine.  They represent what dementia will cost us down the road even with no inflation simply because there are more of us and we’re living longer lives.

Dementia is an adversary worthy of battle at the highest levels of government.  But neither Senator Lee nor Senator Rubio nor Representative Schock mentions it on his website. 

Instead, Senator Lee champions what he calls “saving the American dream,” which rolls back Medicaid funding to 2007 levels and caps it there.  Senator Rubio has endorsed the same approach.  Medicaid currently pays $36 billion a year of the $200 billion cost of care for people with dementia.  Under Senator Lee’s plan, it will pay even less than that toward the $1.1 trillion cost of care in 2050.

And Representative Schock goes one step further.  He touts a bipartisan effort last year to repeal the CLASS Act, which ironically would have offered private insurance for dementia-related care to take some of the burden off Medicare and Medicaid.

Dementia hits close to home for all of us.  A member of our family has it, and it has been progressing relentlessly for several years.  This is a pretty scary thing to witness.  It’s like watching a blackboard filled with facts and figures being erased, one giant sweep at a time, until all the information fades.

Senator Lee wants to save the American dream, but does he really want to do it by substituting a national nightmare of disease with no relief?  And whose dreams is he really saving?  Not the ones of our family members with dementia, nor the ones of their caregivers who already shoulder so much of the burden, nor even the ones of the 243 members of Congress who may someday join the ranks of those with dementia. 

Senator Lee, Senator Rubio, and Representative Schock are, of course, entitled to pursue the policies they choose.  But I hope they will never say that no one could have foreseen what they chose to ignore.

If you have questions about this column or wish to receive an email notifying you when new Our Health Policy Matters columns are published, please email gionfriddopaul@gmail.com.

Mental Illness, Aging, and the Failure of Public Policy

In the next twenty years, more than 3 million people over the age of 65 will likely experience serious mental illness.  Are we prepared to treat them?

The answer is no, according to a new Institute of Medicine report. 

The report was released in July, and it contains some striking evidence of the challenges we face as we confront the growing behavioral health care needs of our aging population.  We don’t have nearly enough trained providers.

And when states cut their existing state Medicaid programs or refuse to adopt the ACA Medicaid expansion, these decisions have devastating consequences for the providers we do have – and, of course, their patients. 

Today, between 5.6 and 8 million adults over the age of 65 are believed to have mental illnesses.  These numbers could nearly double over the next twenty years. 

There’s a reason that the range is so big.  We’ve given so little attention to this challenge in the past that we don’t even have an accurate count.

We do know a lot, however.  As the IOM report documents:

• At least 14-20% of the elderly population has a mental illness.
• Up to 1.9 million have a mental illness described as “serious” – a number that could grow to over 3 million by 2030.
• 57% of nursing home residents, or 675,000 people, have one or more mental health conditions.
• Dementia is not the same as mental illness.  However, 57% of adults with dementia, or approximately 2.5 million people, also have symptoms of mental illness.
• Older women are more likely than older men to have every type of behavioral health condition except two – alcohol abuse and drug abuse.  In fact, the prevalence rates of mental illnesses among elderly women are 50% higher than they are among elderly men.

Publicly funded programs – like Medicare and Medicaid – are essential to treating all these people. 

The 2009 AHRQ MEPS data determined that the cost of the mental health services alone for the over-65 population exceeded $17 billion.  Affecting 7.4 million individuals, behavioral illness was the 8^th most costly condition for the over-65 group. 

Medicare paid just over half the bill all by itself and the combined Medicare, Medicaid, and other public share was 70%.  Private insurance, on the other hand, paid under 12%, far less than patients paid out-of-pocket.

These costs don’t occur in isolation from other health care costs.

This is because elders with mental illness are also likely to have chronic physical conditions.

In one representative study cited in the IOM report, this group had an average of 3.8 co-occurring physical conditions:

• 58% had hypertension
• 57% had chronic pain
• 56% had arthritis
• 55% had hearing or vision loss
• 39% had urinary tract or prostate disease
• 28% had heart disease
• 23% had chronic lung disease
• 23% had diabetes
• 21% had gastrointestinal disease
• 11% had cancer  
• 8% had neurological disease

This puts pressure on providers, who must manage multiple chronic conditions at the same time. 

What’s the most cost-effective way to do this?  We already know the answer.

“What works for many older adults who need MH/SU services is a patient centered, team-based, primary care-centered model that is proactive and employs a coordinated team of personnel with specific roles and special training,” the IOM report concludes.

In other words, the same primary and behavioral health care integration initiatives that work for the non-elderly population work for elders, too.

But unless policymakers change the course of their current thinking dramatically, we may not get close to what we need.

• The report identified “a conspicuous lack of national attention” to developing an appropriate workforce – including mental health counselors, primary care providers, care coordinators, and others – to give this care.
• It also described “a fundamental mismatch” between the need for coordinated care and Medicare’s refusal to pay for the services of trained care managers and psychiatric consultations.

We could add a third.  State cutbacks to existing Medicaid programs and states’ refusals to implement the ACA Medicaid expansion compromise our most vulnerable aging adults.  Those with mental illness and other chronic conditions usually have few resources of their own to pay for their care.

The question raised by the way we treat elders with mental illness is an important one.  Do federal and state policymakers mean to throw the neediest of us out into the cold as we age?

If you have questions about this column, or wish to receive an email notifying you when new Our Health Policy Matters columns are published, please email gionfriddopaul@gmail.com.  For more columns about mental health policy, click on the “Mental Health” tab at the top of the page.