Of course healthy people are going to skip coverage. The penalty is, what, 2% of your income? My health insurance premiums cost me far more than that, and I get insurance thru work, so I’m not even paying the full cost. The penalty is cheaper, by at least an order of magnitude, than even the most basic plan.
I would be very happy to expand Medicare for all, and allow private health insurance companies to work on top of that, as happens in many, other countries.
What I’m not happy about is the continuing work these companies are doing to make an extra buck on the backs of their sickest members, because IT DOESN’T MAKE SENSE. If you make a working-class parent pay the top tier price of $45 for a child’s preventative asthma inhaler and she can’t afford that, she won’t buy it. Then the kid will end up in the ER or inpatient, and any corporate “savings” on that inhaler are moot. This has been demonstrated again and again, but insurance companies still do it, as if their members can will themselves out of asthma, diabetes, or heart disease.
I have said, and will say again, that until these companies smarten up and give a damn about their members’ health beyond nagging them with phone calls and emails, they need to go commit self-love up their jacksie with a small thermonuclear device.
Your stats are pretty much correct.
The top 5% are the incrediably sick patients – those with ESRD or major cancers, or “million dollar babies” born prematurely. Sometimes major, major traumas. We are able to control those costs by following evidence-based medicine protocols, applying appropriate preventatives (so grandma doesn’t get pneumonia on top of cancer, for example), and by keeping costs within the member network. Also, finding out from the patients what they want, so we don’t perform major interventions on a patient if that intervention doesn’t provide much benefit.
The second 5% or so is generally patients with multiple major clinical problems that aren’t well-controlled. Asthma with diabetes and hypertension, for example. The goal is to keep these people from moving into a sicker category, and to get their gaps in care under control so they can perhaps move into the “well-managed multiple clinical conditions (MCC)” cohort. CMS is working on improving care for MCC patients.
The bottom 80% or so range from perfectly healthy to well-managed chronic conditions.
What’s interesting, is that people don’t stay in one cohort. Someone in the second 5% can move into the bottom 80% by obtaining good medical care and following through on everything they need to do. This means, for example, that an uncontrolled diabetic receives counseling from a nurse and learns that he has to do some things to keep from getting sicker. So s/he measures his/her insulin daily and uses an app to track insulin levels; takes diabetes meds as prescribed; takes prescribed blood pressure and cholesterol medications to avoid cardiovascular side effects; works on his/her diet; takes exercise; gets lab tests as directed by his/her physician. This costs money up front, but saves it in the long run. THAT is what’s difficult to get insurance – and patients – to understand.
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Yup, and that explains why our healthcare system has a problem. We have a sick-care system in that way. We’re not willing to pay a little to treat a problem when it’s fairly small, and to work with patients to keep them healthy or to prevent them from getting worse.
I used to point to the fact that obesity counseling or treatment was always totally non-covered under insurance, but now they seem to be catching on that maybe that’s a false savings. Or maybe it’s just a hot topic right now.
That’s not a 20% margin though. 80% is what gets paid to providers. All the other costs have to come out of the other 20% before we know what the margin is.
Not on top of the single payer system, but in competition with it.
That’s simply not true. Private insurance plans in Australia, for instance, provide upgrades for “nicer” service – private rooms instead of shared rooms – but this is not “competition.” You’re completely wrong here.
What I meant is that this is how it should work, and how it does work in Germany. You can pay for the public insurance or you can opt out and get private insurance instead. About 11% of the population, mostly the well off, choose to opt out:
What we could do is keep Medicare and the VA, but change Medicaid into the new single payer health insurance. People could opt in if they wanted to, but everyone else could just keep what they have.
Grumpy,
That is why the incentive systems now are transitioning away from the old ways and into population health metrics.
Don’t get me wrong, I recognize that it is a work in progress and that not all get it yet. But overall medicine is not a solo event now; we work in systems. The evolution is to create the processes to identify those who are sickest and intervene with intensive outpatient care before they need lengthy admissions and re-admissions; to have fewer in that top group and have that healthier group be larger than 80%. That out of control diabetic with multiple co-morbidities? They have tons of resources being thrown at them, phone calls, care coordination, whatever it takes.
Many insurance companies do get it and quite a few medical groups do. I do not get the sense that UHC does but many do.
Since you used it as an example, asthma care in particular is often well incentivized. We as a medical group have significant dollars at risk based on our meeting or not meeting various quality of care metrics for preventative asthma care: documenting that patients are in a good clinical place, having asthma action plans reviewed, flu shots given, monitoring that there is not an excessive ration of rescue inhalers being used relative to preventative medicines prescribed, even documenting that depression has been screened for if control is more difficult to achieve.
Anecdotally we have at least as many children in our practice with asthma now as ever but kids needing to be admitted? Rare as hens teeth as they say. Usually a no-doc showing up in the ED when we are on ED call.
Remember that movie “As Good As It Gets” with Helen Hunt and Jack Nicholson in which her child had asthma and they portrayed the HMO as refusing to give him care? The irony is that it was the HMOs in real life who were spearheading incentivized disease management models that got kids better preventative care so that they needed admissions, ED visits, and even rescue inhalers less often.
The buzzword phrase in the industry is “value-based health care” and catalyzing the transition is more than anything else the biggest achievement of the ACA, of much bigger import than the exchanges.
That would be kind of a PITA, since Medicaid is administered by the states and as far as I know, does not have any kind of central repository of member information. It would cost money to set it up so it would be an effective option nationally.
Medicare is already set up with a centralized member database (through Social Security) and can access and share that claims and member information across state lines if needed. There would be no need to change from one plan to another when you move or if you receive services somewhere else. No need to get different states’ claims systems to be able to “talk” to each other, since that already exists with the Common Working File.
To get Medicare for all up and running, you really would only have to send out Medicare cards to everyone and upload the SSN information for every American into the Medicare eligibility file. Wham, ready to go.
Medicaid would have to be handled on the state level, which would be a logistical nightmare.
I work in population health, DSeid. 
And unfortunately, we do still see plans that have those false savings, and have high levels of ED and inpatient claims. Maybe not with children, but we see it with adults a lot.
To continue:
And unfortunately, I still see plans that have those false savings, and have high levels of ED and inpatient claims. My employers work with a lot of large insurance companies. ACOs are doing the best job of using value-based care; insurance companies are also learning, though I don’t know how much of that is passed on to members, to be honest.
It certainly doesn’t stop them from pulling crap like making the formulary for a class of medications very small and charging the highest co-pay if you need to go off-formulary, or deciding to make generic drugs the highest co-pay. That’s great for people with chronic conditions.
HMO’s might’ve been incentivizing DM models for kids’ preventative care back in the day, but more than one HMO in real life kept very sick people from going to the ED, telling them they had to wait to see their PCP. That was a huge problem in the 90s until laws were passed to stop it. Ditto not approving medications, based on the opinions of physicians employed by the HMO, and there was no way to fight them. It was ridiculous.
BTW, I worked in Medicare and health insurance from 1992 onward. For the last 3 years, I’ve worked in population health.
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I did specify that not everyone “gets it” yet and that is an evolution in progress. Some indeed are still penny-wise pound foolish. And some systems, maybe even most at this point, get the basic concept now but are still completely inept at executing it. Obviously you see the wide range out there.
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To be, well not “fair”, but at least accurate, from the insurance company bean-counter perspective, the savings are not always “false.” Some of the investments will pay off but pay off years later … and by then the insured will quite likely be in another plan. Avoiding that investment might make fiscal sense for them. They do respond though to incentives that focus on processes and shorter term population goals.
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And to to be fair, there was and continues to be a significant level of abuse of the ED being used for things that do not need ED level care. Among the most common presenting complaints and diagnoses in EDs? Sore throats, URIs, gastroenteritis, basic bruises, headaches, back aches … some of which do indeed need care within a reasonable period of time but relatively few that need ED level care. And there was and continues to be a huge amount of prescribing with no regard to cost or even to guidelines. Lots of expensive nth generation-osporins when good antibiotic stewardship guidelines would advise either amox or watchful waiting with no antibiotic at all, lots of name brand Crestor when generic Lipitor would do just as fine, lots of name brand proton pump inhibitors before a basic H2 blocker has even been tried, lots of Advair scripts when a cheaper preventative (unfortunately few true generics in this sector) would be the better and safer clinical choice (yes Advair, one target for price controls, is way way way over-used). The “huge problems” of the 90s were to everything I ever actually saw, experienced, or researched, more a handful of scattered horror story anecdotes, well publicized and used for political theater. Actual data showed the HMOs of the 90s providing often better outcomes than traditional FFS did.
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No question though in my mind that most insurers are inept at handling the pharm benefits issues, especially regarding generics. Some of their attempts to control cost backfire and result in worse quality of care … lower value. No question.
So, what exactly do you do in population health? Maybe you can explain to me how a particular chronic health problem becomes an HCC one and others don’t? (The actual nuts and bolts of the risk-stratification bit confuses the heck out of me!)
Why would it be a nightmare to be administered at the state level?
The single-payer system in Canada is done that way.
Can you imagine the bureaucracy/admin that would carve off GDP overnight.
We might reasonably expect that a fundamentally healthier population would offset that.
Do we want fifty different administrators of healthcare?
Why not? That’s how federalism works.
In any event, how many do you have now, when you count all the private insurance companies, which I understand are restricted to working in single states, not across state borders? Wouldn’t fifty single-payers actually be a reduction from the current number?
And you’ve said it would be a nightmare. What concrete problems do you foresee?
How many insurance company processing centers are there? Do we want five hundred different administrators of healthcare?
No strong opinion but simple contribution of a statement of fact: there is big difference between the circumstance of the ten provinces of Canada and the fifty states of the United States. Those differences include more than the five times as many of them.
The Canadian system allows each province to opt out, requires that provinces have reciprocity, and does not cover drug benefits or mental health services.
I agree - the US system is more complex - but that to my mind is an argument for decentralization to the states, not a single health payer system run out of Washington.
Compare Alaska, Rhode Island, New York and California: would a one-size-fits-all-states model run from DC really work?
That’s the benefit of federalism: the federal government can set the general ground rules, provide money to states that want to implement it, and then the states actually do implement it, based on local conditions.