Obama Should Consider Canadian Health Care System 'Hardships' When Developing Overhaul Plan, Editorial States

This article discusses another reason why the Canadian Healthcare in not necessary less expensive than the US system It seems that the Canadians have found the way to reduce costs is to provide their citizens with less services. Will Americans be happy when services and tests are being withheld? Will they want bureaucrats making health related decisions for them? Also check my blog on 10/27/08 about how the Canadian system provide less testing services than we are use to in the US.

President Obama and congressional Democrats last week took a "first step ... toward government-run health insurance" with the enactment of a law to reauthorize and expand CHIP, but they should consider "Canada's experience" before "proceeding further," Nadeem Esmail, director of Health System Performance Studies at the Fraser Institute, writes in a Wall Street Journal opinion piece.

He writes, "Health care resources are not unlimited in any country ... and must be rationed either by price or time," and as a result, when "individuals bear no direct responsibility to paying for their care, as in Canada, that care is rationed by waiting." Esmail cites several "constitutional challenges" filed by Canadian patients placed on waiting lists for health care that "share a common goal: to win Canadians the freedom to spend their own money to protect themselves from the inadequacies of the government health insurance system."

According to Esmail, the "experiences of these Canadians -- along with the untold stories of the 750,794 citizens waiting a median of 17.3 weeks from mandatory general-practitioner referrals to treatment in 2008 -- show how miserable things can get when government is put in charge of managing health insurance." He concludes, "Canada's system comes at the cost of pain and suffering for patients who find themselves stuck on waiting lists with nowhere to go," and "Americans can only hope that ... Obama heeds the lessons that can be learned from Canadian hardships" (Esmail, Wall Street Journal, 2/9).

Obama Pick Gets a 2nd Chance on Health Care

Here is some information on the Kansas Governor and Secretary of Health & Human Service nominee Kathleen Seblius. I find it interesting that as the State's Insurance Commissioner she fought against HMO's rationed care and early releases from hospital. Studies show these are the methods used by socialized medical systems around the world to control cost. Therefore I have to wonder how she will expand coverage of a system that is already draining the trust fund?

By KEVIN SACK

TOPEKA, Kan. — In Kansas, Gov. Kathleen Sebelius is known as a Democrat who can deal with Republicans, a necessity in a state where the opposition party dominates both houses of the Legislature.

But on matters of health policy, which she will oversee if she is confirmed as President Obama’s secretary of health and human services, Ms. Sebelius’s efforts to forge bipartisan consensus have rarely succeeded. She recently observed that the greatest frustration of her six years in office had been her inability to persuade lawmakers to raise tobacco taxes for a modest expansion of government health coverage.

Now, with the backing of a Democratic Congress, Ms. Sebelius will have a chance to achieve in Washington what she failed to accomplish in Topeka, and then some. When he announces her nomination on Monday, Mr. Obama will effectively make her the point person for what may become the largest expansion of taxpayer-subsidized health insurance in more than four decades.

Ms. Sebelius, 60, would start the job in midstream. Last week, while she was battling with the Legislature over its desire to allow a pair of coal-fired power plants in western Kansas, Mr. Obama began his effort to revamp American health care by telling Congress that change “will not wait another year.”

Mr. Obama then proposed to raise taxes on the wealthiest Americans to help pay for a $634 billion investment in expanded government health coverage over 10 years. His efforts are complicated by the recession, which is draining the Medicare trust fund more quickly than expected, according to federal officials.

Ms. Sebelius’s nomination comes nearly a month after Mr. Obama’s first choice, former Senator Tom Daschle, withdrew upon revealing that he had owed $128,000 in back taxes and paid it only after being selected. The White House used the time not only to vet Ms. Sebelius, but also to make sure that the two Republican senators from Kansas, Sam Brownback and Pat Roberts, would not oppose her confirmation.

The governor is a Roman Catholic who supports abortion rights, and her vetoes of anti-abortion measures have drawn derision from social conservatives, including a request by the archbishop of Kansas City that she not take communion. Her spokeswoman declined an interview request for the governor, saying her schedule would not permit it.

Ms. Sebelius is said to have a wonkish understanding of health policy, but she has failed to make significant improvements in health coverage or costs during her two terms as governor. Although the proportion of Kansans who are uninsured remains well below the national average — 12.7 percent versus 15.3 percent — it has grown seven times as fast in the state than in the nation during her tenure, according to census figures.

Health insurance premiums in Kansas rank just below the national average and have increased at about the same rate as the nation’s, according to figures compiled by the federal Agency for Healthcare Research and Quality. The same was true during the previous eight years, when Ms. Sebelius served as state insurance commissioner.

In that job, Ms. Sebelius cast herself as a consumer champion by pushing to protect patients from rationed care by health maintenance organizations and rapid discharges by hospitals. She declined campaign contributions from the industry she regulated and, in her boldest move, rejected the 2002 purchase of the state’s largest insurer, Blue Cross and Blue Shield of Kansas, by Anthem Inc., based in Indianapolis.

No other state insurance commissioner had blocked such a sale, but Ms. Sebelius argued that it would result in higher premiums for Kansans. Litigation ensued, and she ultimately was upheld by the State Supreme Court.

“She rode that decision all the way to the governor’s office,” said Sandy Praeger, the current insurance commissioner and a Republican.

Legislators in both parties said that as governor, Ms. Sebelius’s efforts to reach across the aisle had seemed more strategic than instinctually bipartisan. She is skilled at exploiting the divisions between moderate and conservative Republicans, and has successfully forged coalitions with one caucus or the other on redistricting, school financing and the state budget, among other issues.

When she stood for re-election in 2006, she persuaded a former state Republican chairman, Mark Parkinson, to join her ticket as a Democrat (he will succeed her if she is confirmed for the cabinet position).

But when it comes to health care, the governor and the Legislature have been separated by a philosophical gulf, with Ms. Sebelius supporting a larger government role and the Republicans steadfastly resisting it.

“Both her proposals and her accomplishments have been limited to some extent by the political realities of the state that she governs,” said Dr. Robert F. St. Peter, president of the Kansas Health Institute, a research foundation.

In 2004, her second year in office, Ms. Sebelius proposed expanding the state’s low Medicaid thresholds to cover 70,000 of the state’s 300,000 or so uninsured, and to pay for it by raising tobacco taxes. The measure died.

The next year, she issued an executive order creating a new health policy agency that would centralize purchasing and planning in her office. The Legislature blocked the move, and instead created an agency controlled by legislative appointees. Ms. Sebelius went along.

In her 2007 State of the State address, Ms. Sebelius urged lawmakers to “commit ourselves to universal coverage.” Though she said little about how to achieve that, Republicans tarred her as an advocate of “socialized medicine” — or “Hillarycare,” as Melvin Neufeld, who was House speaker at the time, put it.

Ms. Sebelius, a former state representative, called on the Legislature to begin by covering all children up to age 5. Again, she made little headway, though in 2008, an election year, the Republicans expanded eligibility for the State Children’s Health Insurance Program without appropriating any money to do so.

Although she signed the bill, which also made a modest expansion of Medicaid for pregnant women, she called it the session’s biggest disappointment. She had also failed to win approval of a statewide indoor smoking ban.

“It has been something that I find puzzling and troubling and not a lot different from what’s happened in Congress and with the administration,” she said in a December interview with the Kansas Health Institute News Service.

Legislative leaders say Ms. Sebelius presses her case in occasional meetings and news conferences, but rarely cajoles or twists arms.

“I see her in the hall and say hello, and that’s it,” said State Representative Brenda K. Landwehr, a conservative Republican who heads the Health and Human Services Committee. “She’s never asked me to visit with her. I think she’s a very strong individual, that things are either done her way or the highway, with little room for compromise.”

The daughter of an Ohio governor, John Gilligan, and daughter-in-law of a Kansas congressman, Ms. Sebelius herself appears healthy and fit. She and her husband, Gary, a federal magistrate judge, have been married for 34 years and have two sons. She played basketball in college, runs three miles nearly every day and does not smoke. By all accounts, she remains popular in Kansas, scoring a 57 percent approval rating in one January poll.

Because the possibilities for change here have been so narrow, there is little sense of Ms. Sebelius’s views on broad questions like whether Americans should be required to have health insurance or whether, as Mr. Daschle proposed, health policy should be delegated to a board styled after the Federal Reserve.

As secretary, Ms. Sebelius would have considerable influence over government policy on abortion. Although she says she personally opposes abortion, she has consistently defended abortion rights in a state where the anti-abortion movement can be fierce. She has vetoed anti-abortion measures almost every year, including bills that would have required the licensing of abortion clinics and allowed relatives to petition a court to stop a late-term abortion.

Experiences of Cancer Patients Illustrate Potential Problems With Private Health Coverage For People With Life-Threatening Illnesses

Many employers now provide their employees with the option of a Critical Illness plan that helps employees in the situation outlined below. These plans are normally employee paid and can offer the employer payroll tax savings. If you would like to learn more about these plan please contact me.

WASHINGTON, DC – Cancer patients can face severe challenges in paying for life-saving care – running up large debts, filing for personal bankruptcy and even delaying or forgoing potentially life-saving treatment – even when they have private health insurance, according to a new report by the Kaiser Family Foundation and the American Cancer Society.

The report profiles 20 patients and illustrates the potential difficulties people diagnosed with cancer or other serious illnesses have in maintaining affordable health insurance and paying for their health care. The patients in the report and accompanying video were selected to illustrate typical cases from the many people who call the American Cancer Society’s Health Insurance Assistance Service, which helps families affected by cancer who encounter problems navigating the health care system.

For these patients, having private health insurance at the time of their cancer diagnosis did not protect them from high out-of-pocket costs – leaving them with large debts to cover their treatment costs and forcing some to skip or delay necessary treatments.

“The stories of people with cancer in this study and video documentary show what our earlier survey work found: that the insurance system often fails people when they need it most, when they get really sick,” said Kaiser Family Foundation President and CEO Drew Altman, Ph.D.

“Cancer patients too often find out that their insurance doesn't protect them when they need care the most,” said John R. Seffrin, Ph.D., national chief executive officer of the American Cancer Society. “High out-of-pocket costs coupled with the high cost of insurance premiums can force cancer patients to incur huge debt, and to delay or forgo life-saving treatments.”

The report, which was released today at a briefing in Washington, D.C., highlights five key gaps in the health care system that can leave people with cancer and other life-threatening diseases in financial jeopardy as a result of their diagnosis:

• High cost-sharing, caps on benefits leave cancer patients vulnerable.The various types of cost-sharing and limits on benefits found in some insurance plans may quickly lead to high out-of-pocket costs once cancer treatment begins. For instance, Jamie Drzweicki of Miami ran up more than $75,000 in debts after her breast-cancer treatment costs exceeded her policy’s annual limit.

• Those with employer-sponsored coverage may not be protected from catastrophically high health care costs if they become too sick to work. Most people get their health coverage through their employers, which often pay most of the premiums. Under existing law, people who lose their jobs because they are unable to work generally must decide within 60 days whether to temporarily retain their employer-sponsored coverage through COBRA by paying the full premium costs. Phyllis Miller of Johnstown, Pa., who has been unable to work since having emergency surgery for late-stage colon cancer, missed the 60-day deadline and has struggled since then to afford the premiums and cost-sharing of her less comprehensive individual policy.

• Cancer patients and survivors are often unable to find adequate and affordable coverage in the individual market. Cancer survivors who have been in remission for years and have a good long-term prognosis may still have trouble finding coverage or pay higher premiums in the individual market. For instance, 10 years after Thomas Olszewski of Graham, Texas was treated for early prostate cancer, he still is unable to find affordable health coverage and pays one-fourth of his family’s income in premiums for a high-deductible plan.

• High-risk insurance pools are not available to all cancer patients, and some find the premiums difficult to afford. High-risk pools, which are designed to help cancer patients and others who are uninsurable, are not available in all states, and when they are available, they are often much more expensive than most other plans in the individual market. For example, high costs have prevented breast cancer survivor Mardel Budreau of West Lafayette, Ind. from enrolling in a high-risk pool after learning her individual insurance policy only paid $250 toward her radiation treatment.

• Waiting periods, strict restrictions on eligibility, or delayed application for public programs can leave people who are too ill to work without an affordable insurance option. Cancer patients too sick to work may qualify for Social Security Disability Insurance income and, after two years of receiving this income, may qualify for Medicare coverage. During the waiting period, patients typically have reduced incomes and may not be able to afford private insurance coverage. This happened to David Young, a truck driver from Godwin, N.C., who has not worked since being diagnosed with late-stage kidney cancer. Young became eligible for Social Security disability benefits in October 2007 but does not yet qualify for Medicare benefits.

The report, Spending to Survive: Cancer Patients Confront Holes in the Health Insurance System, was jointly authored by researchers at the Kaiser Family Foundation and the American Cancer Society. The Kaiser Family Foundation also released a separate video documentary profiling three of patients featured in the report.

The report and video are available online at www.kff.org and www.cancer.org. In addition, a webcast of today’s briefing will be available online after 5 p.m. ET today.

The Kaiser Family Foundation is a non-profit private operating foundation, based in Menlo Park, California, dedicated to producing and communicating the best possible information, research and analysis on health issues.

The American Cancer Society is dedicated to eliminating cancer as a major health problem by saving lives, diminishing suffering and preventing cancer through research, education, advocacy and service. Founded in 1913 and with national headquarters in Atlanta, Georgia, the Society has 13 regional Divisions and local offices in 3,400 communities, involving millions of volunteers across America. For more information anytime, call toll free 1-800-ACS-2345 or visit www.cancer.org.

Medicare reimbursement shakes things up

Comment: This article discusses a survey that suggests part of the high cost of employer paid and individual health insurance (10.6%) is due to the insufficient payment made by Medicare and Medicaid. Something to consider when many people want the government to take a larger role in the process.

By Lydell C. Bridgeford

January 28, 2009

Insufficient reimbursements to physicians and hospitals by Medicare and Medicaid contributes to higher health insurance costs for private employers and their workers, according to a study by Milliman, a Washington, D.C.-based actuarial consulting firm.

The annual health care cost for an average family of four is $1,788 higher because of insufficient payments made by Medicare and Medicaid to physicians and hospitals.

As a result, privately insured employers and consumers make up the shortfall through cost-shifting. Employers and health insurers pay a "hidden tax" of $88.8 billion each year, reports Milliman.

The analysis defined the cost shift as the difference between actual payment rates and average payment rates for Medicare, Medicaid and private payers. The research doesn't examine appropriate levels of payment, but instead shows the disparities between current payment rates.

The study reports that cost-shifting adds an estimated $1,512, or 10.6%, to the average premium for a family of four. Of this amount, employers pay $1,115, and the employee share is $397. Families also spend an extra $276 more in coinsurance and deductibles due to the cost-shift.

"As we consider approaches to expand coverage nationally, we need to keep in mind the disparity among Medicare, Medicaid and commercial provider payment rates and the pressure that this disparity places on hospitals, physicians and commercial payers," says John Pickering, principal and consulting actuary at Milliman.

Medicare reimbursement polices will also affect how hospitals use nurses to generate revenue, according to a survey by AMN Healthcare, a health care staffing company.

The survey involved 305 hospital chief nursing officers and examines the role of nurses as financial rainmakers.

Under new Medicare rules, hospital reimbursements will also factor in patient-satisfaction rates regarding quality of care. When asked about Medicare efforts to tie hospital reimbursement to patient satisfaction scores, 62% of nurses indicated that patient satisfaction-based payment systems would enhance the status of nurses.

"Many hospitals in the past have considered nurses to be a cost," notes Marcia Faller, chief nursing officer of AMN Healthcare. "Under the new payment systems, they are more likely to be seen as an investment," she adds.

Cobra Update

Did you realize that the Stimulus Package has made changes to the Cobra options offered to involuntary terminated employees back as far as September 1, 2008?

On Tuesday, February 17, 2009, President Obama signed the American Recovery and Reinvestment Act into law. Included in the Act is a provision that may affect any companies which are required to offer COBRA to former employees: the Health Insurance Assistance for the Unemployed provision.

At this point, numerous items in the Act are unclear. So far, one major component of the Act is clear:

• A 65 percent subsidy toward the purchase of health insurance will be available to individuals:
• who have been involuntarily terminated from their employment between September 1, 2008 and December 31, 2009, and
• who earn less than $125,000 (single) or $250,000 (couples) annually.
• The subsidy will only be good for a nine-month period and will be for the purchase of health insurance only.
• The Treasury Department will administer the subsidy, providing employers with a credit against their payroll taxes to cover the cost of the subsidy.
• While there is no “look-back provision” for current COBRA Participants, qualified individuals who were involuntarily terminated and initially declined COBRA coverage will be allowed to reverse their earlier decision. Specifically, a special election period will be offered during which they may elect COBRA coverage and thereby receive the subsidy.

This provision may well increase the number of individuals on COBRA.

Now that this is law, the DOL is expected to release guidance concerning this provision.

For more information about Cobra Adminstrators that can help you comply with these new changes, please contact Ray Ward at Legacy Benefits & Insurance Service.