Monday, January 31, 2011

Flordia ruling

Judge rules parts of the the law unconstitutional and I think he is saying that the entire law falls because of lack of severability clause. Of course, what really matters is what Anthony Kennedy thinks....I guess that comes sometime in the next year or so.

A better idea would be to work to improve the bill, along these lines.

Bending the Curve

This is a nice, succinct analysis from the Commonwealth Fund that places health reform into a deficit reduction context and that argues that all parts of the health care system need to have 'the cost curve bent' and not just federal health care spending.

I am increasingly convinced that the hardest part of health reform and bending the cost curve is not technical, but cultural. By that, I mean that people say that they want to slow health care cost inflation, but they don't seem to understand that if that happens, it will mean that we somehow spend less on health care than what we are now projected to spend. You can only cut payment rates so much. Eventually, if we slow health care cost inflation, it will mean that care that could be provided, is not. For example, a surgery that doesn't extend life, or improve quality of life, doesn't take place, when it could have. I think it can be done in a way that helps patients and doesn't harm them, but it will be hard. And we won't know unless we actually try.

Whether you think that some sort of expert-based rationing of care via guidelines and federal boards is the way to go about this, or believe that privatizing Medicare and having competition drive down costs (and everything in between) is the best route to take in bending the curve....the last step if health care cost inflation does slow is that less care will be provided than would be provided under the status quo.

I think we need that. Most say they want want it, but I am not sure I believe them.

Wednesday, January 26, 2011

Can Congress do hard things?

Interesting snippet from today's House Budget Committee hearing, where chairman Paul Ryan briefly explains his Roadmap plan's proposed Medicare changes after a Democratic member must have been criticizing it. The setting is a hearing where Richard Foster, the actuary of HHS testified to the following two notions according to press coverage (I didn't watch the hearing):
  • (1) some persons covered by Medicare Advantage would lose their private plans (and so violate the 'you can keep it if you want' pledge) because payment cuts will cause some insurance companies to not offer plans in their county; and
  • (2) he (Foster) doesn't think the Medicare savings promised in the ACA will materialize because he doesn't think Congress will follow through on hard things.
If the past is a perfect predictor of the future, Richard Foster is correct on point 2. We will not do the hard things to slow Medicare growth, and health care costs will bankrupt our nation.

Opponents of the ACA are gleeful over his pronouncements today, and seem to nearly be saying, 'we pledge to be irresponsible' and if we cannot repeal the ACA we will just get rid of the parts that have a chance to slow cost inflation (like the Independent Payment Advisory Board). And we 'know' Congress will never follow through with cuts in the future.

The essence of Mr. Ryan's Medicare portion of the Roadmap is to say to people age 55 and over, Medicare won't change for you. Fee for service Medicare will be around as long as there is one of you left. If you are 54 and under, we will take Medicare spending the year we enact the Roadmap, and let it grow much slower than health care cost inflation in Medicare has grown in the U.S. for the past 40 years. Then in 10 years, when the 54 year olds hit 65, they will get an amount of money to purchase private health insurance that will be a good bit less than what Medicare spent on 65 year olds the year before. This WILL SAVE THE FEDERAL GOVERNMENT MONEY. There is no doubt about it. Transitioning Medicare into a defined contribution voucher for private health insurance would reduce the federal government's expenditure of care for the elderly. The big question is what could it buy in the way of coverage for the elderly?

If it happens.

Why is it that Congress would be able to do this hard thing if we are now saying they cannot do any hard thing in the way of Medicare cuts? The year before the first age cohort (when the 54 year olds reach 65) get their voucher to go and buy private health insurance instead of fee for service Medicare, why will Congress not say 'well, we need to increase the amount of the voucher because we are worried about....' Or, 'we need to delay the implementation for 5 more years because'....

Health care costs are the essence of our long term budget problem. It would appear that our culture has a nearly insatiable ability to consume health care. We are spending ourselves into oblivion on health care, and do not appear to be getting our monies worth. The arrival of the baby boomers to Medicare is going to greatly stress the federal budget absent any consequential changes. We have got to do something, and it will be hard.

The tearing down of the best faith efforts of the CBO to score the ACA, and the statement that we can never do anything hard to achieve cost savings may win the sound bite competition on the next segment on cable news, or even the next election. However, at some point our country has to come up with a credible way to address health care costs. The proposed 10 year ACA Medicare cuts are nothing compared to moving in the future to replace Medicare with defined contribution vouchers with which the elderly can buy private health insurance. How does Mr. Ryan expect anyone to believe we will do what he wants if he and others say we can't even do easier hard things?

We will only do the hard work of addressing health care costs if somehow both political parties can work together.

Tuesday, January 25, 2011


Reasonable speech, but not enough specifics on the deficit for me. Similar for the Republican response. Both sides have experienced political success by essentially arguing "I am not as bad as them." That will not be enough going ahead for us to deal with the budget deficit. We need a long term plan that paves a route to a balanced budget. I have said in the past I think the President is the only person who can lead us in this in this Congress.

The longer we wait to address the long term deficit issues--and health care costs are the central long term problem--the fewer options we have. The President's Deficit Commission plan is a good place to start the discussion.

Today, Senator McConnell said that there were 6-9 months that a big effort on the deficit or anything else is possible. He also said that they wouldn't 'debate entitlement reform in public' which is fair enough. I hope Republicans and Democrats are talking behind the scenes about at least some steps to start this process.

I wrote this about Paul Ryan's Roadmap back in February. I have changed my thinking about Social Security a bit since then....basically, the problem with Social Security is not as bad as I thought it was a year ago and I am not sure it makes sense to burn so much political capital with Social Security reform. The problems with Medicare and Medicaid (and health care generally) are even worse than I thought a year ago. We need to tweak Social Security and then set about what will be a 20 year + effort to address health care costs. It is important to remember that Ryan voted against the Deficit Commission proposal even though he should have recognized lots of his ideas in it, so it is a bit hard to take him seriously at this point. He is of course the Chairman of the House Budget Committee, so has plenty of opportunity to prove me wrong.

Monday, January 24, 2011

More on high deductible

Ezra Klein discussing high deductible insurance options and discussing Jon Cohn's post on similar topic. They both point out that high deductible options will be available in exchanges. Klein points to this interesting paper that I haven't read on the subject by Jason Furman.

Cohn asks a question that is important and to which I don't know the answer: how do current HSA plans compare in an actuarial value sense to the Bronze insurance level that would be available in exchanges in 2014? A further question, what would the options look like if we moved away from, and not toward more tax preferenced spending for health insurance and health care?

I think that trying a push for universal coverage with catastrophic coverage and then trying to develop a market for underneath cover would be a step ahead. I know that people can choose Bronze in the future, but I still think we would be better off to focus on getting everyone into something while moving away from tax preferenced spending on health insurance and health care generally. And if you got to universal, you could do away with the individual mandate; let people choose to buy underneath cover or not, as was their wish. In any event, if we discuss policy options to alter the ACA that would be never know, the different sides might stumble into some things we could agree upon.

Keeping with the notion of talking, Igor Volsky with 5 health policy ideas/compromises he says the President should embrace tomorrow night in the State of the Union. Ross Douthat with his ideas along the lines of compromise/further talk.

CLASS Discussion

Austin Frakt has two posts up this morning on the CLASS provisions of the Affordable Care Act. The discussion of CLASS has focused on the actuarial soundness of the program (the goal is to create a self-sustaining long term care insurance plan, meaning paid for by individually paid premiums) and the contribution of the CLASS provisions to the 10 year CBO score (it accounts for around half of the 10 year deficit reduction of the ACA). I wrote this column on CLASS in Dec. 2009, and CLASS is instructive in helping folks understand how scoring works. My column says, in part:

"CLASS is designed to be self-financing, meaning premiums plus interest must pay for future benefits. The 10-year deficit reduction occurs because benefits are not paid out for the first five years, but premiums are paid in. Proponents claim that CLASS is self-financing over the long term, and opponents say it will increase the deficit in later years. Both are correct.

It is hard to project what will happen with CLASS, mostly because of uncertainties regarding disability rates 30-plus years from now, but there are numerous provisions designed to ensure that the program is self-financing. Regarding the long-term deficit, when a program runs a surplus, it buys federal securities that pay interest. When interest is later used to pay for care, it is counted as a transfer instead of revenue. Therefore, CLASS will inevitably increase the deficit in years 30 to 75 even if it pays for itself totally through premiums and interest earned on premiums, given current budget accounting rules."

The most important discussion of the CLASS provisions is what are the policy goals it is trying to accomplish, what are the other options, how successful is it likely to be given the law that actually passed, what tweaks might be made to it, etc.

  • The big idea of CLASS is to make thinking about long term care a normal part of being a young adult. It is not today, and this means many do not plan well for LTC. Keep in mind that Medicaid is the current default payer of nursing home care in the U.S.
  • CLASS is designed to be 'age in place' insurance with benefits on the order of $50/day, so not enough to cover a nursing home. You would expect such benefits to have a very high moral hazard effect, certainly higher than insurance that covers nursing home admission would have (I have never met anyone who hoped to some day live in a nursing home). This is good in that it holds out the chance to slow admission to a nursing home, but also means people will be interested in claiming benefits.
  • Private long term care insurance is fairly rare, on the order of 7-10% of the population age 50 and over, depending on the sample used to measure it. There are lots of reasons people don't purchase private long term care insurance, and this paper I wrote with colleagues in the January 2010 issue of Health Affairs on the use of genetic markers as LTC insurance underwriting variables lists 6 major ones. In short, there is no reason to expect the private insurance market is likely to take off any time soon. It is likely going the other way. MetLife announced in Nov. 2010 they were stopping the sale of such policies.
  • The CLASS provisions needed a conference committee bill more than many parts of the ACA, in my opinion. Some aspects of the law are viewed as too vague, while with CLASS there is a fair amount of detail that may box in implementation in a way that makes it hard for the program to be self sustaining due to adverse selection. Notably, the definition of work is quite generous (I believe less than $2,000 per quarter in earnings) which means that those who are now disabled may be able to qualify. [you must be working to sign up for CLASS] I am not saying those now disabled are not worthy of support and help, but CLASS is not the vehicle to help them. The idea of CLASS is to get young, healthy people to plan ahead. Adverse selection is the biggest risk to any such a plan.
  • The part of HHS that is primarily implementing CLASS is the Agency of Aging. I am not privy to why this is the place it is being done, and obviously there are many things to do to implement the law, but putting CLASS into AoA seems an odd place if the goal is to get younger, healthier folks to sign up. This isn't proof of a problem, it just seems odd to me. At one point ASPE was to be the main place, but they typically do policy and analysis and not as much on implementation.
  • There is extreme danger of a self-fulfilling prophecy with CLASS. If the American Academy of Actuaries says the final implemented version of CLASS is unsound and will fail, then healthy people aren't going to sign up and it will fail.
I strongly support the idea of CLASS--to get young adults to think about long term care before they need it. And risk pooling is the way to handle the problem of long term care. In fact, if ever there were a risk that called for social insurance, it is long term care. Around 7 in 10 people will use some LTC, with around half of those using some doing so for less than a year, but 10 percent using it for more than 5 years. 30% will die prior to using LTC, and if you are sitting around a table, I bet the person to your left, to your right and across the table from you think they will be among the 30%. However, more social insurance is not going to happen any time soon, and a self-sustaining insurance pool is theoretically possible if you work hard to get young people to sign up.

I think that with some tweaks, CLASS could work well. It is unclear to me whether the tweaks can be made in the implementation of the provisions that have passed into law, or whether new legislation is needed. CLASS has mostly been a political football in discussions of CBO scores, and the notion of budget gimmicks in the ACA. In my view, this is incorrect, and a good deal more attention should be paid to the policy goals that CLASS is seeking to advance. And the problems that it is intended to address. We can repeal CLASS, but we certainly cannot repeal the reality of disability. It would be better if we tried to make it work.

Update Jan. 25: @IncidentalEcon posted this Jan. 2011 CRS report on CLASS that I have yet to read.

Saturday, January 22, 2011

Most detailed health reform poll to date

is out, done for NY Times/CBS News. Several folks have already blogged about it: Kevin Drum and Greg Sargent. The health reform questions start on page 18 of the link.

48% say the law should stand as is, with 40% saying it should be repealed. They then asked those saying they wanted repeal if they favored repeal of the entire bill or parts of it, and about 20% wanted full repeal, 18% repeal of parts of it, with 2% saying they were not sure. The poll then asked more detailed questions than I have seen about what aspects of the law those wanting repeal most want ended. Of those saying they want repeal, when asked what they most want repealed, 8% say everything, and 11% say the individual mandate. Nothing else gets more than 1%.

There are some other interesting questions from about page 15-18 about the deficit, and people's view of how to address the deficit, including their preference for increasing taxes or cutting spending. Roughly speaking, they prefer cuts in the abstract, but the more specific you get about programs like Medicare, Social Security and Medicare they prefer increased taxes.

Of course, the one true item of bipartisan consensus is lower taxes and more spending....

There are 5 or 6 polls out this week and the confidence interval on what percent want repeal of some or all of it (the two combined) is 37% to 50%, with those wanting total repeal clustering around 20%. Hopefully the Republicans in the House will move on with some modifications that could improve the law, especially in addressing health care costs.

Friday, January 21, 2011

CBO Fuzzy Math

Austin says it well. Exhausting discussion.

The Grand Bargain

Austin Frakt responding to Republican claims that they want to first lower health care costs which would make it easier to insure more people. This is of course true, but it is hard to do and the public and providers will freak out if we actually lower costs because providers would make less money and the population would get less care. I don't think you can realistically tackle costs without addressing coverage. Austin wonders if there is a compromise that could lower costs while expanding coverage?

I wrote a post about a month ago that outlines what I see as a way forward to try and do this. However, the policies I suggest wouldn't represent a series of small bills, but would in fact be quite a grand compromise. This 'plan' really represents what the health bill that passed might have looked like if the two parties had actually compromised with one another in the 111th Congress.

If we are looking for a smaller compromise, look to the interests of Democrats and Republicans. When you do this, I am not optimistic that a smaller compromise exists because the ACA passed, moving us toward a key Democratic party goal: universal coverage. Arguing for a compromise in spite of the passage of the ACA is the uncertainty of the legal challenges related to the individual mandate.

To simplify, Democrats (liberals/progressives) understand the lack of universal coverage to be an existential mark against our country, really a matter of national shame, and so universal coverage of some sort is their ultimate health policy interest. I am not sure that Republicans (conservatives/liberterians) have one health policy goal that is as widely held as strongly as is universal coverage for Democrats, but I think that worries that costs are too high and the moral hazard of overly generous insurance is as close as you can come. If you combine medical malpractice as a generalized proxy for lawyers/regulation holding back business, then you probably have a comparable Republican interest.

Democrats have just passed a bill that will move us to around 94-95% insurance coverage by 2020; no universal coverage, but creeping up on it. The only way the Democrats will play ball on a compromise is one that produces universal coverage.

If Republicans decided to focus on costs and trade universal catastrophic coverage for heightened cost control, they would deserve a great deal of credit. And they could claim a victory in getting rid of the individual mandate, though of course guaranteed catastrophic coverage is a type of mandate (as is Medicare). They could of course, still claim victory. And Republicans could likely get quite a lot on malpractice reform for universal coverage, which would save some money, but not as much as most think. And the trade of universal coverage for pared back guaranteed insurance levels (high deductibles) would also help to slow cost inflation.

The hardest health care cost control steps would remain to be taken, notably ending the tax preference of employer paid insurance premiums which would mean making those with generous private insurance worse off, and doing something to slow cost inflation in the Medicare program. Whatever mechanism is used, the test of success is whether less care is delivered to Medicare beneficiaries than will be done under the default. This will be hard.

Would a malpractice reform and less generous guaranteed benefits be enough of a victory for Republicans to cut a deal that gave the Democrats universal coverage? Would such a compromise then pave the way for a later compromise that truly addressed health care costs?

My head says yes, but my heart says no. Or maybe it is the other way around, I am not sure.

Thursday, January 20, 2011

More Delusion

NY Times poll and commentary by David Leonhardt.

Roughly speaking, we think the deficit is a big problem, but it is always "their" fault. We believe the deficit can be fixed without raising taxes or cutting spending. We are profoundly delusional. When giving talks to community groups on health reform and health care costs audience comments always goes something like this. Taxes are too high. We have to reign in out of control health care spending. Then I talk through several options that could slow health care cost inflation and people hate them all.

One of the worst byproducts of our political culture today is that both parties are able to get away with saying 'we are not as bad as them.' This basic message worked well in 2008 and 2010. This keeps us from directly addressing the big problems like health care costs in a serious manner. We need to go beyond the Affordable Care Act, not have meaningless votes to repeal these first steps with no concrete proposals about what would be better. Conservatives answer 'tax cuts' regardless of the question. Progressives are late arrivers to the issue of the deficit, and this has let the conservatives get away with rank fiscal hypocrisy.

In the end, I think Progressives have more at stake on the deficit than do Conservatives, because Progressives believe that government does have a key role to play in modern life. Conservatives are happy to cut taxes but not spending and then say the inevitable deficit proves government doesn't work. Progressives must take up the cause of developing a long range balanced budget or else there will be no room for government action where it is needed in the years ahead. Hopefully the President will begin making the Progressive case for sensible deficit reduction in the State of the Union.

Day 3, Negotiated Rulemaking

Day 3 of the January 2011 negotiated rulemaking committee is underway. Full committee meets until Noon (with public comment at 11am). Subcommittees will then meet this afternoon to refine our work plans/tasks in preparation for the next meeting.

8:30: starting with reports from subcommittees proposing their work to be done prior to the February 2011 meeting. Basically laying out tasks that need to be completed to inform key decisions. Key areas are pros/cons of various provider data sources and especially the tradeoff between supplementing readily available data with primary collected surveys/data collection areas. Big question is how much better info for how much more local cost?

9:00: Presentation on Healthy People 2020. We have been having some discussion in the committee about choice of measures and when in doubt picking measures that overlap with other key efforts (like Healthy People 2020 targets and goals).

9:35: Marc Babitz (committee member from Utah) giving a presentation on his vision/route to completing our work. He has been the most consistent member of the committee and asking us to focus on identifying poor health status/need in prioritizing designation methods which are used to allocate resources. He has done a good job of helping us to see the big picture goal of what we are doing (easy to get lost in the weeds). It is a gift to be able to take alot of information that has been provided in many ways and to restate them in a straightforward manner.

10:00: Excellent discussion has resulted in response to Marc's presentation. The clarity of Mark's views have helped other members of the committee to clearly present their views. Very positive last 45 minutes in helping the committee think through the issues and refine their positions/views which is a necessary for us to be able to reach a consensus.

10:30: Committee member Bob Phillips presenting some of his work (much done in conjunction with/by his colleague at the Bob Graham Center Steve Pettersen) on the use of social deprivation indices to proxy poor health outcomes. They began around 8 years ago seeking to devleop a measure of poor access to primary care, but have found the measure to be fairly highly correlated with poor outcomes (like Ambulatory care sensitive conditions, diabetes prevalence, mortality, etc). There is some interest in potentially combining the use of a social-deprivation type index plus actual observed health outcomes in areas to allow for an aspect of 'fact checking on the ground' a designation approach.

Discussion of tradeoff between many variables with highest explanatory power v. more parsimonious (simple) model that explains most of the variation that a more complicated method would.

Bob has showed a conceptualization based on observed data that is useful, I think. High risk below means as measured by social deprivation index, high need means based on observed outcome measures.
  • High risk, high need >>> high priority for resources
  • Low risk, high need >>> ambiguous, need to look closer
  • High risk, low need >>> ambiguous, need to look closer
  • Low risk, low need >>> lower priority for resources
Discussion of face validity and ability to explain results and how you move it into an actual designation process.

As an aside, Alan Morgan, if you are reading, the discussion this morning is what you have been wanting! Very specific, committee members interacting and communicating well!

11:15: setting agenda for February meeting.

11:20: public comment.

2:45: subcommittees adjourned. Good meeting, progress made.

Wednesday, January 19, 2011

ACA: Repeal and Implementation

Today the House of Representatives voted to repeal the Affordable Care Act (ACA) in what is viewed as largely a symbolic action because the Democrats control the Senate and President Obama would veto a straight repeal in any event. I think meaningful compromises that would improve the bill are available, but it is unclear whether today is the just the start of Republican health policy efforts in the 112th Congress, or the pinnacle. Time will tell.

During the repeal vote, across the Potomac in Crystal City, Va. a 28 person negotiated rulemaking committee (I am a member of the committee) that was created by the ACA was diligently working on one small piece of the nitty gritty of implementing the law: considering changes to how the federal government identifies Health Professional Shortage Areas (HPSA) and Medically Underserved Areas/populations (MUA/P). These designations make local areas and populations eligible for special resources to help address shortages of primary care providers (like the National Health Service Corps, Medicare physician bonus, etc.) and/or extreme health care needs (Community Health Centers, Rural Health Clinics, etc.).

The means of designating HPSA and MUA have been largely unchanged since the 1970s. The Clinton Administration attempted to revise these methods, but the proposed changes were rejected during the federal rulemaking process as constituencies affected by the changes revolted. The Bush II administration also tried to revise these methods, with the same result.

The ACA stipulated the creation of a negotiated rulemaking committee that is based on the notion (and a statute) that you bring different stakeholders together to work on difficult issues, with the government agency in question (in this case the Sec of HHS) agreeing to use the solution developed by the committee as the new rule for how these designations are done if the committee can reach consensus. The idea is that interest groups will feel represented by the process and therefore accept the new rule (though there is no guarantee of this result).

Serving on the committee has been an interesting experience. It has been time consuming and complicated because of the many issues with which we have to grapple. At times it has been frustrating, yet I believe we are making progress toward an improved designation process.

However, regardless of the final outcome of our work, the highlight for me has been meeting people with different backgrounds from all over the country who are unified in a simple goal: to improve the health of those with poor access to primary care, and to improve the lives of those with unique health problems that would otherwise be unaddressed. Even when I have not understood the perspective or position of a colleague, or disagreed with someones position, I have never doubted their commitment to trying to best use the finite resources our nation has for these purposes in the best possible manner. And I have learned a great deal from these committed people. I am hopeful we will achieve a consensus by early Summer, when our work is to wrap up.

Here are my thoughts on the first two days of the January 2011 meeting.
September 2010 meeting day 1, day 2.
October 2010 meeting day 1, day 2.
November 2010 meeting day 1, day 2.

Day 2 Negotiated Rulemaking Committee

9:30am: Starting out today with an important discussion of the difference/relationship (if any) between HPSAs and MUAs. Dealing a great deal with the differences between the statutory language and the current rules and operating procedures. Key discussion. Committee had tentative consensus that we will have two processes, HPSA and MUA and that seems to hold still. My understanding of the statutes would make it very hard (impossible) to have one overall designation approach. Further, there are distinct programs that use these designations, some using HPSA and others MUA/P designations.

10:30: Discussion of measures of supply of primary care providers, with report from the data technical subcommittee on these issues. Lots of detailed issues to discuss, who is a primary care provider, who provides primary care, who (what types of providers) to be excluded from determining supply for purposes of designation, data sources to measure same, etc.

10:55: Thought this part would be straightforward, but roadblock on how to/whether to account for the provision of primary care by specialists for the purpose of determining supply of primary care. Sigh.

11:30: Still discussing how to determine primary care provider supply. Issue of how to count non-physician providers a big task (essentially a weighting issue). The technical subcommittee has recommended counting of Nurse Practitioners (NP) and Physician Assistants (PA) in the determination of primary care supply for the purpose of HPSA designation, which is not currently done. The distributional politics of this are tricky. As you expand who is counted, the supply goes up and makes it harder to get a designation, especially in states with more open/advance practice laws for non physician providers. Adding such providers will require a recalibration (meaning you can't keep a ratio to define supply based on one type of provider).

12:30: Lunch break. If my granddaddy were alive, he would say we are on a twisty path....

1:15: Started back and working to clarify some consensus on what types of providers will count as primary care and to clarify what analytical tasks the data/technical subcommittee will complete for the February meeting.

2:30: working now on what population adjustments may need to be made in calculating provider:population supply ratios. For example, what to do about residents in prisons, jails, long term care facilities and the like.

3:10: some discussion on different types of adjustment (age, race, sex).

3:45: We are now working through the pros/cons of several variables that could be used as measures of/proxies for health status that could be used in an index to designate areas as being medically underserved and/or to denote high need for areas seeking a HPSA designation.

4:35: now talking a bit about the merits of having a unified index-type measure (end result, one number) from a disaggregated approach, where you would explicitly show the various parts of an index.

5:15: continuing discussion of an index approach that combines direct measures of health status with social deprivation type measures (area level variables that have been shown to proxy health status/outcomes). One issue being discussed is the poverty rate and how it doesn't adequately account for cost of living. This is important because the research done by some of the data/technical subcommittee shows that poverty level is one of the most important proxies of bad health outcomes/high need. How to take cost of living into account?

We have also talked about the RWJ County Health Rankings and looking at the variables they use and the weights they used. The source data are mostly vital statistics, BRFSS, some Dartmouth Atlas info and other economic measures....they assign county scores but don't observe data in all counties for all variables they use. My take on this is that it is a cousin of where we are likely to end up....there are only so many ways to do this....the key turns out to be how you weight particular items in an index.

5:45: Made progress today.....28 members is a lot to have on a committee. Just sayin.

Tuesday, January 18, 2011

HR 105

This bill was noted this morning as a replace piece of legislation by Rep. Burton. I haven't read it closely, but it includes tax credits for insurance purchase by low income persons, allows deductibility of premiums paid for private insurance up to your federal income tax liability, sale of insurance across state lines with companies setting up a primary state in which they do business (and follow that state's insurance regulations), and setting up high risk pools (which are not working so well in the ACA).

It will be interesting to see what CBO says about this...I will try and read it tonight.

Update: @igorvolsky with a blog post comparing the ACA to the House Republican alternative bill that was offered in Nov. 2009 and was scored. Not sure how similar HR 105 is to HR 3962 the House alternative from Nov. 2009.

Negotiated Rulemaking Committee

The first morning of our fourth meeting got off to a good start with an excellent presentation by the subcommittee that is focusing on issues related to sub-population designations. Key issues of discussion:
  • making space for sub-populations that may emerge in the future which are today unknown; for example, HIV didn't exist (or at least wasn't identified) when these designation approaches were first developed in the 1970s.
  • the relationship between medically underserved population designations and facility Health Professional Shortage Area designations, notably a medically underserved population should result in automatic facility HPSA designations;
  • determining what data sources and what measurement and documentation standards are needed for the designation of sub-populations as being medically underserved (ex. homeless persons)
Good start to the day.

After lunch, the data/technical subcommittee presented our work. We made some good progress in developing some preliminary decisions about types of providers to count for the purpose of HPSA designations. When looking at medically underserved area (MUA) designations, we are looking at different approaches. The main issues/debates are:
  • Do we attempt to directly measure health status/outcome/underservice or use a proxy approach? The tradeoffs are that direct assessment conducted locally would be the most specific, and could be address local realities, but this would be time consuming and the most underserved areas might not be able to launch such research-driven exercises. Basically, there is a tradeoff between specificity and simplicity/ease of designation. Also, a combined approach can be used with proxy measures and direct health measures.
  • Do we put multiple variables/parts of a designation into one index (in which case the weighting of component factors is key), or use disaggregated component measures that identify different 'parts' of the problem?
  • Do we assess these concepts as compared to a normative standard, or do we set designation in a relative sense (e.g., worse quartile)?
Update 4:05pm: now discussing rational service areas, or the geography at which we assess geographical HPSA/MUA. [special population designations will also exist]. The phrase 'Gaussian kernel density' was just used and this has prompted a move toward a coffee break....

Actually, no coffee break but a presentation by David Goodman of Dartmouth, a member of the committee on Primary Care Service Areas (PCSA). County and some sub county unit of geography will be needed for impact of testing of any new method(s) that the committee will propose. PCSA is one option that is national, and can be overlaid with multiple data sources to allow us to understand how new approaches will impact designation.

Administration's Back Track on EOL Planning

Jim Hufford on his blog Organon with a detailed and insightful commentary on the Obama Administration's backtrack on expanding Medicare's paying physicians for EOL counseling. He makes a convincing case that while the announcement of this policy change may have been handled appropriately, given the context of this policy from the health reform debate, withdrawing the policy change was the correct thing to do. (h/t Austin Frakt and @IncidentalEcon)

On the policy merits we should expand funding for this type of counseling. However, policy changes do need to be done in the appropriate manner.

Update: article on related topic in NY Times. More on MEDPAC's proposed 2012 payment update for hospice.

Monday, January 17, 2011

January Meeting of Negotiated Rulemaking Committee

I will be in Washington, DC Tuesday-Thursday Jan. 18-20 participating in the HRSA Negotiated Rulemaking Committee meeting that is reconsidering how the Health Professional Shortage Area (HPSA) and Medically Underserved Area (MUA) designation indices are constructed. The Negotiated Rulemaking committee was created by the Affordable Care Act. These methods (HPSA and MUA) are used to designate areas as being eligible for resources such as National Health Service Corps Physicians, Community Health Centers, and a Medicare Physician payment bonus. Subcommittees have been working hard since our last meeting in November and we are making progress. I will blog a bit from this event to give insight into our deliberations, which are open to the public if you are nearby the Radisson Hotel-Reagan National Airport on Jefferson Davis Highway in Arlington, Va. this week. Hours are 9:30am - 6:30pm on Tues; 9:00am-6:00pm on Wed; and 8am-Noon on Thus. There is time reserved for public comments.

Back to the future

Interesting post by Ezra Klein, imagining a class in 2030 discussing health care reform from 2010-2030.

Sunday, January 16, 2011

Outline of Health Compromise (@kevinmd on twitter) posted my suggestion from mid-December for what a compromise health plan could look like. It will be interesting to see what House Republicans do in the way of developing a 'replace' or 'modify' bill(s).

Friday, January 14, 2011

The President's Next Step

Matt Yglesias says the President shouldn't lead on tax reform, while Andrew Sullivan thinks he should.

Yglesias is correct that there are political risks of getting out front on this, but there are also political (and policy) risks of not taking this head on. Now that we have a second stimulus through the extension of the tax rates and a payroll tax holiday, a credible long term deficit reduction strategy is correct on the policy merits. For the President, it is likely the best politics as well, because leading on the deficit issue is likely the only way to win back independents in key states like mine (North Carolina) that the President narrowly won in 2008.

We will deal with the deficit and cumulative debt at some point, the only question is whether we do so only after an economic crisis when our options will be limited, or whether we do so in a reasoned manner. Now is the time to fight this out.

A two-pronged approach makes the most sense for the President: try and work with the Senate on tax reform, while insisting that the House Republicans follow through (after their repeal vote) and make clear what they would do to replace the health care law.

The President shouldn't allow the House Republicans off the hook after the repeal vote, but he should go back on offense and continue to ask: when are the committees going to start writing the replace part? If you have good ideas, lets have them and see if we can work something out. Remind them how easy they said it would be to enact common sense reforms that would truly address costs. See what the CBO thinks of their plans. Of course it is much easier to be opposed to something than it is to describe what you are for.

There are some consequential ways the Affordable Care Act could be changed to both address the unpopularity of the individual mandate, but more importantly to take some next needed steps to address health care costs. Modification bills along these lines (and perhaps others) would be good news, and the hardest steps on costs will only be done with both parties participating.

The President's Deficit Commission report (Bowles/Simpson) was approved by 5 of the 6 Senators on the panel, and this signals the potential for a consequential reform emerging from the Senate. All of the Senators voting in favor of the report, including leading conservative Tom Coburn, said the plan wasn't what they would have personally written, but they all know that a serious, long term deficit reduction strategy will look something like Bowles/Simpson, with an overall tax reform at its heart. The Senate being so closely divided means anything will take both sides participating (7 Republicans will have to vote to override a filibuster), and the President should seek to work with the Senate on a long range tax reform/deficit reduction plan. Given all the words that have been said about needing to address the deficit by House Republicans, a White House/Senate deal would produce enormous pressure on the House to get involved, and of course to shape any bill that would emerge.

If we ever adopt a serious, long term deficit reduction plan that moves us toward a sustainable federal budget, the last political step will include members of both parties passing a bill that is akin to their holding hands and jumping off a cliff together. The President is the only person who can take the first step toward the edge.

Small Steps

My friend Frank Hill with an interesting post talking about talking with people who differ from you on issues, big and small.

Frank and I met via correspondence around one of the columns I wrote on health reform for the Raleigh (N.C.) News and Observer. We were disagreeing about some aspect of the pending health reform law (I don't even remember what) but we started talking and sharing our distinct perspectives (Frank was Chief of Staff for Sen. Elizabeth Dole, and Rep. Alex McMillan from Charlotte).

The more we talked, the more we realized that our basic motivation for being involved in public policy discourse was fear about what we are leaving for our children, both in terms of debt, but also the seeming inability of our system to practically solve problems. We have become friends and have a project or two cooking together. Meeting and talking with Frank actually has helped me to clarify what I believe about some issues, and also to appreciate and see how 'the other side' thinks about some of them. However, Frank is no longer 'the other side' but now a friend.

Tuesday, January 11, 2011

Politics of illegitimacy

It is a bit off-topic for this blog, but several students have written and asked me what I think of the events in Tucson. It was a terrible human tragedy and a very sad day for our nation. It was a particularly grievous act in my mind simply because the shooting took place while an elected representative was going about her duties to represent her constituents.

We don't know why the shooter did what he did, but from past assassinations we know there is often a complex etiology for such attacks that tends to include mental illness. The role that rhetoric and imagery could have on violence is an important question, but I simply don't have an evidence-based answer. Yet, this event feels like a momentous occasion that is worthy of introspection.

As I thrash about and try and make sense of this tragedy and what it means for our nation going ahead, I settle on something I have been thinking about for awhile, and which has crystallized in my mind the past few days. The disturbing trend in American politics for losers of elections to decry the winners as being illegitimate.

I first voted for President in 1988 and I voted for the winner in that election. The country moved on pretty well.

I voted for the winner again in 1992, but there was a very different context to the aftermath of Bill Clinton's election. There was a general sentiment from some quarters that he was illegitimate as President because he received less than 50% of the popular vote cast due to the presence of Ross Perot's strong third party candidacy. Of course, the President is elected by the Electoral College and there is no stipulation that the winner must get a majority of the votes cast, though that typically was the case in modern times.

In 1996, President Clinton was re-elected with less than 50% of the votes cast (49.2% to be exact), again due to Perot being a candidate. It always bothered me that opponents of the President whom I knew personally would argue that he was illegitimately elected due to the fact that 'more people voted against him than for him.'

President Obama won approximately 53% of the popular vote, and had the largest Electoral College victory since President Reagan. Of course that hasn't stopped some of his political opponents from arguing that he is illegitimately elected even though the issue of his citizenship was long ago decided. Much of the opposition to the President has been tied to his 'otherness' I think, which is all designed to label him as illegitimate, which would make his policies all the more heinous.

Of course, my chronology skipped an election.

In 2000, the tables were turned, and I voted for the loser, Al Gore, who got more votes than did President Bush. Even though I had been irritated by the phrase after the 1992 and 1996 elections, this didn't stop me from saying to some that 'more people voted for Al Gore than President Bush' which is of course true but constitutionally irrelevant. I can vividly remember calling President Bush the 'President Select' before his January 2001 inauguration in derision of the Supreme Court's ruling in Bush v. Gore that settled the disputed election.

Several people older than I who are not big fans of President Obama have told me that they haven't seen the country 'as angry as it has been the past 2 years' in their lifetime. I always remark that they must not have come to Durham or Chapel Hill, N.C. between 2003-2008! Self righteous rage against one's political opponents is truly bipartisan.

There was a ubiquitous bumper sticker and tee shirt in Durham, N.C. around 2003 that said 'Somewhere in Texas a Village is Missing its Idiot.' This always made me chuckle until one day I heard one of my young children say that President Bush was dumb. I sternly told her that was disrespectful and asked her who she had heard that from. She said simply, you Daddy.

For some reason, I cannot get that out of my mind this week as I try and make sense of the tragedy in Tucson.

I think the essence of the progressive/liberal hubris is that we think we are smarter than everyone else. Instead of listening, and then trying to be persuasive and make the case, we are tempted to construct a defense mechanism that says that if you don't quickly adopt my view it is just because you don't understand. If only the country was filled with those as smart as me.....

I think the essence of the conservative hubris is the belief that conservatives are more moral/noble/patriotic than others. They are tempted to write off those who disagree with them as being unworthy of America because they think we don't love it enough. If only the country was filled with those as good as me.....

At their heart, both sources of hubris say that people with different views are illegitimate in one way or another. Someone who is illegitimate is not worth talking to, respecting, listening to, understanding, or even debating reasonably. Certainly not worthy of compromising with to solve the huge problems facing our nation.


Word this morning of a major development in the local health care delivery marketplace where I live: Blue Cross/Blue Shield of North Carolina and the University of North Carolina Health System are beginning a joint venture to provide health care delivery services to BCBSNC customers in the Durham/Chapel Hill area. This joins the largest private insurer in the State of North Carolina with the very large UNC health system.

The plan is for 5,000 BCBS NC customers to be cared for at this facility, and only persons covered by the insurer will be treated by the new organization, with care being provided by UNC. The goal is to improve quality and lower cost via increased data sharing and organization. It is being heralded as an uber-medical home approach that will test new ways of interacting with patients and linking data to improve care. My biggest question is who will receive care in this new venture?

I would assume that many of the persons getting care at this facility would be State Employees who work at UNC health care or the University of North Carolina at Chapel Hill. However, the State plan is a self-insured plan that is administered by BCBS NC. Not sure if that fits the description of BCBS NC 'customers' or not? BCBS NC also has many employees in this area, so it could be that many of those who will receive care in the new facility will be their employees; again, I believe that BCBS NC has a self-insured plan that they administer for their own employees, so it is not clear if their employees are included in the planned 5,000 patients. Presumably the number will also include persons in the area covered by group or individual policies written by BCBS NC.

There has been tremendous aggregation in the local health care market, with many medical practices being bought up by UNC or Duke over the past decade, and especially the past 3-4 years. Duke owns Raleigh Community Hospital, and UNC has large linkages with Rex Health Care in Raleigh, which recently lead Wake Medical Center in Raleigh to seek records about UNC's dealings, and to claim that UNC was acting in a predatory manner in Wake County.

In short, the big player hospital and health systems are all trying to lock up as many physician practices, and therefore patient streams, as possible. And they are also looking for ways to improve care and reduce costs. This type of experimentation is what is needed in our health care system, but of course we don't know the results until they implement and evaluate this venture.

It is easy to say any change is due to health reform. In one sense that is correct. But, the aggregation was happening before health reform, and it will continue regardless of what happens next in Washington. The facts on the ground in the health care system are that we are spending ourselves into oblivion and our outcomes suggest we aren't getting our monies worth. We have to do something different. Ventures such as the one described lay out the hope of better organization leading to better care, potentially at lower cost.

The downside is the further aggregation of medical care delivery into fewer and fewer providers, reducing consumer choices. At least in the Research Triangle Area of North Carolina, the cow is well out of the barn on the medical practice aggregation issue and the only question remaining is how many large provider systems will remain in 10 years. Given that reality, and the fact that it is not easy to imagine moving away from this aggregation, it is good to test and evaluate new models such as this one.

Update 4:30pm 1/11/11:Someone from BCBS has told me that BCBS NC employees can use this facility, as can self-insured plans that are administered by BCBS; discussions between BCBS NC and the State Employees Health Plan about potential benefits of this facility for State employees are underway.

Friday, January 7, 2011

Christians and rationing

Charles Camosy with an interesting discussion of how he thinks Christians should view rationing of health care services.

Wednesday, January 5, 2011

EOL Switch Again

Word that Medicare is reversing its course and will not allow expanded discussion of patient choices such as advanced directives and options such as palliative care as part of Medicare annual exams. This is bad in policy terms and serves to limit access to important care for America's elderly. I guess the politics were understood to be too negative, especially the notion by some that this effort was sneaky and done in secret, put out in the federal register with little fanfare. OK.

Sing this from the rooftop, no more secrets.

We will all die. It is a matter of when, and from what. I want my grandmother, my mother, my father, myself, my wife and everyone I know to be able to hear the truth about prognosis, choices and quality of life. I want to make sure that informed consent means both 'informed' and consent which means 'made a choice.' Palliative care focuses on improving quality of life regardless of prognosis. I want access to it, again for those I love and for me. Everyone doesn't have to make the same choices my family makes or that I make.

Lets talk about this more, over and over. When you have an inevitable outcome of death, eventually there will be diminishing returns on what we do to forestall death. If you don't believe this, you believe it is possible you could live forever. You cannot. Lets talk about these facts as a country and figure out what we want to do. But, we need to start from the only thing I know to 100% true of the health care system: we will all die, it is only a matter of when, and from what. What do we want to be true about the care available in the Medicare program (8 in 10 deaths in the U.S. occur among Medicare beneficiaries) as this reality unfolds?

Quick update: I don't know if there was a faulty procedure in how Medicare put out this change; if yes, that is quite amateurish; if no, then politics are overriding policy/best care for patients.

Monday, January 3, 2011

It is a good to revisit health reform

The Republican majority in the House of Representatives is moving ahead with a repeal vote of the Affordable Care Act (ACA), which is set to take place on January 12, 2011. The conventional wisdom is that this is a waste of time because it would take 60 votes in the Senate to repeal the ACA and two-thirds of the House and Senate to override the inevitable Presidential veto.

I disagree. It is good news that we will revisit health care reform. I have written consistently that the ACA was a good step, in large part because it was a step. The law that was passed has the chance to begin to address health care costs if implemented, and substantially expands coverage, but we know that we will have to do more in the future to get a handle on health care costs. And we must do more soon because our long term deficit problem is fundamentally a health care cost problem.

One of the benefits of passing the ACA is that it has put the health care system in play, making further changes to health care inevitable. There are certainly policy options that would improve the ACA, and if the Republicans used their new found majority in the House to push some of these options like capping the tax exclusion of employer paid health insurance premiums to slow health care cost inflation, they would deserve credit.

Here are some thoughts I have about what a compromise between Democrats and Republicans could look like. If Republicans are inexorably opposed to an individual mandate now, then lets produce true universal coverage and do away with the need for one. I would trade true universal catastrophic coverage for scaled back insurance benefits and no individual mandate in a second.

The Republicans promised in the election that they would repeal the ACA. Fair enough, have the show vote. But, after that, they owe it to the country to provide clarity in the direction they would take the nation on health care reform. They have to shift from defense to offense. There is no evidence they have an offense.

Now is their chance to prove me wrong: they control the House of Representatives, and all the committees. They need to move beyond slogans and sound bites and write a bill. If it is so simple to address costs and 50 Million uninsured persons, the bill will be short and everyone can read it and get to know it well. Then have hearings on their bill. Mark it in a committee(s). Have the CBO score the bill. Let the country talk about it, and how it compares to the ACA. Debate the best way forward. And then put it to a vote in the full House of Representatives. The Republicans not only owe specificity to the country, they owe it to themselves if they want to be taken seriously on matters of health policy.