When the Affordable Care Act, also known as Obamacare was originally negotiated, the idea of a public option or single payer was deemed politically impossible at the time.
We will probably never learn the real truth behind the forces trying to prevent a true single payer system as most western countries have developed (Often we hear the political narrative or talking points instead) until we finally have a single payer system, and the facts eventually surface years later. We do know that the president met with all the major groups that have opposed national healthcare before with their Harry and Louise ads (Drug companies, hospital groups, insurance companies), and negotiated with them before even moving forward, so we can assume he handled those forces. Tactically, his approach markedly improved the odds of success and he ultimately succeeded. It didn’t help that the two political caucuses did not work together as Democrats and Republicans should have, to refine and simplify Obamacare before it ultimately passed and became law. Since there was no real understanding or consensus of why costs were so high prior to the law (other than greed, inefficiencies and defensive medicine), we were left with insurance companies raising premiums yearly, even though overall healthcare costs were said to be slowing over the past five years and many of us were forced out of plans we were told we could keep, and may even left doctors who were no longer in their plans. What gives?
Single payer has a new champion whose name is Bernie Sanders. As you already know, he wants to become president and believes we can roll out Medicare for everyone. Considering he is talking about a system that works for millions of elderly people in this country already, it has already been proven to work, at a cost at least 20 percent less than insurers are charging us. His plan would eventually eliminate Medicaid, the VA system and others because they would all become part of the Medicare for all Strategy. Strategically, having one healthcare system for all is simpler, would require one set of rules, and by having everyone who is an American covered similar to Canada or Great Britain, something that would be much simpler to administrate. Just think of the administrative waste, requiring government growth on exchanges going away. If you are suddenly unemployed but have a serious health problem, it will not bankrupt you and you can still afford to go to the doctor due to the low yearly deductible or copay. Most seniors who are on fixed incomes already take this for granted but before Medicare, this was a major problem for the elderly, even though healthcare costs were less, but on the other hand, we had shorter lifespans as well. For more about the ideas behind Medicare for all, I found this blog that explains Bernie’s plan well.
Without being partisan, the idea of eliminating vouchers without reform, or other supposed free marked ideas sound great until you are seriously ill, a situation that is not unlike having a ticking bomb placed in your hands while trying to figure out how to most cost effectively diffuse it as the clock is ticking. Try making a rational decision when being told you will die unless… . When being faced with this idea, perhaps you can understand why some of the market reforms being suggested by different politicians without the details to back them up are baseless and ideological, when you are in that situation.
Imagine having a gunshot wound; are you going to price hospitals or just to the local ER for immediate help as you race the clock and worry about the cost later. Do you have an insurance company who may pay your bill (or may not causing you to fight them after your care), as they try to deny medically necessary care, while paying for expensive image advertising and make further changes to the healthcare system that have over time proven to make care more expensive or a Medicare card and maybe a secondary which has defined rules on what is and is not covered.
In NJ, we are now seeing tiered plans, high deductible plans, plans that have people put off needed care or wait until they meet the deductible and then they splurge on services that may have cost less had they acted sooner, hardly a cost effective way of operating.
Horizon Blue Cross Blue Shield just launched their new idea called Omnia which suspiciously looks like they took their failed Advanced network and rolled it into their Omnia Network and called it tier 1. Other providers are being offered as tier 2 with higher deductibles or copayments. This incentive of a smaller network within a bigger network likely reduces the pool of providers you may personally want to use, and there is no explanation why 90% of the doctors of chiropractic are Tier 2, yet 86 percent of the physical therapists are given tier 1 status. Basically, if you are already confused, that is the idea. Oh, and by the way, they left 40 hospitals out calling them tier 2 as well, which is anti competitive. AmeriHealth has done something similar, but they have a more minor impact on the state of NJ.
As many insurers do, they have lowered the price of Omnia to give people the impression they are saving money, until they realize the doctor they want is not in the tier 1 network and they need to pay a higher cost to see the provider they really want. While they are giving you a discount, they are also raising the price of your currently overpriced plan to force you out of it financially. If you look at this slight of hand, what they are really doing is creating a plan with a range of prices that has perhaps slightly better coverage than advanced did, but charges you more if you want more access to the rest of their network; giving the illusion than you are getting a better deal for coverage.
Does this seem like it makes sense to allow insurance carriers to continue what they have been doing which has been a large contributor to the high cost of care in our country. One of their legacy’s has been the 10 minute office visit for primary care which has increased the amount of referrals for many problems they used to handle affordably, by underpaying primary care. Obamacare unfortunately, left private insurance in charge, not unlike the Clinton plan would have years ago. The result is have massive yearly increases in premiums when Obamacare took hold. Even if those increases are only 5-8%, the effect of compounding does has amplified the costs, not unlike the effect of buying a certificate of deposit, and which amplifies the value of your money over the years.
The point of this blog is not to bash insurance carriers, but to help us, the consumers of these services become aware that all is not as it seems. Insurers are working toward making sure we pay more so they can make more. The more we pay, the more they make because they are allowed to make 20% on the money they take in. Basically, over several years, they will be able to raise premiums until they are making what they did in 2010 when Obamacare took effect. For those of you who have not seen our previous post, check out the real math of why the costs continue to rise, and it has little to do with healthcare costs, but everything to do with why wall street loves them.
Bernie Sanders, love him or loathe him, has a good point. We already have a social system that works (not socialist, just social for those who are sensitive about the subject) and while insurers already manage private plans for major corporations, we as a country do not need to shake up and dump the system, but when the cost savings come in, the system will likely move toward a true single payer system anyway. Just imagine how the major corporations can simplify things if healthcare moved from their domain to a simple tax (remember, healthcare premiums are a tax anyway) that cost them less for better and more extensive care than runs across state lines.
As one legislator said it a while ago, Medicare for all will likely be offered first to older American’s under 65 and they will pay a premium which they pay now. The difference being, it will cost the typical American less for better coverage, putting more money back in the hands of the middle class. As mentioned before, health insurance is a tax we all pay anyway, so no matter who gets the premium, it is a social responsibility. Paying it monthly as Bernie suggested it in a recent article in the Guardian as part of our payroll may be a good way to bankroll this. Another way is a consumption tax or VAT which is used in other countries, which will likely capture more revenue. This would be a tax on those who consume more and while not perfect, has worked in many countries. Imagine keeping more of your paycheck, while paying more for things; since we all consume, those who consume more pay more and the wealthy will have a more difficult time not paying taxes, as well as those on the lower end of the income curve, so everyone contributes according to what they consume.
The current insurers can sell Medigap policies that the public can purchase to help with the cost of drugs and copayments, except for one thing; will the average American feel the need to buy medigap insurance if their yearly deductible is only $160 dollar and their plan covers 80%. Compare this with most insurance plans these days with $3000 dollar deductibles and high copays, and most folks will opt for Medicare. Companies who self insure may reevaluate their position if it is cheaper for them to buy insurance via payroll through the government.
Insurance carriers who have offered Medicare Advantage plans typically offer an inferior product, with smaller networks, but spend a lot of money trying to convince seniors that they will take better care of them. Why is all this money spent on advertising instead of care? This is yet another reason government systems that are proven to work in other countries need to be used here; healthcare premiums need to be used for healthcare, not advertising, not CEO bonuses, not for exchanges which for most people are confusing and scary, even if you get a government supplement.
Bernie is likely right and he has taken a strong position on this. Perhaps the republican candidates should consider the good it would do to finally move our system into one that is simpler to administrate and one that will have a huge group to spread the cost of care through, eliminating the state by state restriction of competition the carriers enjoy now. Unfortunately, lobbying influences and money from all ends of the medical system needs to be put into check, and the system requires a level playing field.
Nobody knows who will ultimately win the primaries and eventually the elections in November, but it is time our legislators start working for us, and since most Americans on both sides of the isle want simplicity in our system, rather than Obamacare which seems to have created healthcare monopolies, raised the cost of insurance and empowered companies who are say they are trying to keep costs in check, while doing things that make it cost more, real change is needed and as Sanders puts it, healthcare is a social responsibility, and simplifying it is a first step in making it work for everyone.