Health Care Reform

By Sean Shaw, Florida Insurance Consumer Advocate

Why do we need reform?

To begin the health care debate we must first ask some very basic policy questions: Is access to health care in America a right or a privilege? As a country, we have made the decision that the elderly, the disabled and the very poor will have access to health care through Medicare and Medicaid. We have not made the decision that everyone else is entitled to health care. We have good health care in America, but the delivery system is in serious need of reform.

There is no doubt that health care is becoming increasingly more expensive. More people are losing their jobs and thus their health insurance benefits since health insurance is generally tied to employment. We have approximately 46 million uninsured in America, and over 2.5 million in Florida.

There are not enough primary care or general practice doctors to meet the needs of our citizens – especially in rural America. Many medical students are going into specialized practices so they can make higher wages in order to pay the hundreds of thousands in loans they accrued for their education. We currently don’t have many programs to assist in educating physicians. Evidence based medicine is not consistently being practiced. Over utilization is a significant issue contributing to health care costs. The use of the latest and most costly tests, the over use of Emergency Rooms as primary care medicine are all adding to the cost of health care delivery. Some of the extensive use of complex tests is for protection against law suits and some are for profit.

Insurance companies are limiting and excluding more services thus pushing care to the public sector. CEO’s are paid millions in salary and benefits. Insurance company administrative expenses are approximately 30 percent compared to the Government plans (Medicare and Medicaid) 2 percent. The cost to provide health care is continuing to eat up more of the countries Gross Domestic Product (GDP) and it is simply unsustainable. The health care system in America needs to change to cover more people at a lower percentage of GDP, provide quality, evidence based medicine in all areas of the country to all segments of the population.

Below are some facts and quotes that are properly sourced for use.

First, - If you don't have health insurance, you will finally have quality, affordable options once we pass reform. If you have health insurance, we will make sure that no insurance company or government bureaucrat gets between you and the care you need.

Second, reform will finally bring skyrocketing health care costs under control, which will mean real savings for families, businesses and our government.

Third, by making Medicare more efficient, we’ll be able to ensure that more tax dollars go directly to caring for seniors instead of enriching insurance companies.

Lastly, reform will provide every American with some basic consumer protections that will finally hold insurance companies accountable. (NYT Editorial - Barack Obama, 8/15)

What type of reform is best for the consumer?

Reform that provides accessible, quality, evidence based health care in the most appropriate venue at a reasonable cost. So that health care can be provided in the most cost effective manner, everyone should be covered by a health care plan whether it is a government plan, an insurance plan or a combination of the two. Health care should treat illness and injury in a cost effective manner, not in a manner that produces the most profit.

Why are the costs skyrocketing here vs internationally?

There is evidence to support the following behavior in our current medical system contributes to additional costs: (1) referrals to specialists to provide front line care that should be performed by Primary Care Physician’s (PCP); (2) the use of interventions and treatments proven in scientific studies to be ineffective; and (3) the use of expensive imaging studies for the diagnosis of the problem.

What are other Countries doing right that we are not?

Many of the practices that increase costs in the U.S. health care system, such as over utilization of expensive procedures, over utilization of specialty care, too many cottage industries at the trough etc., are not being repeated in other industrialized nations. Below is a review of what other countries are doing in health care:

Other countries health care costs as a percentage of GDP are as follows: (WSJ 8-2009)

What are the biggest traps that consumers fall into in the healthcare arena and how can we reform to fix that?

Asking the wrong questions of health care providers such as - do you take my insurance? Balance billing by providers. Not getting prior approval, or preauthorization, from health insurance providers prior to service being rendered. Not knowing health plans benefits, limitations and exclusions. Since health insurance is tied so closely to employment, when people lose their jobs, they are failing to continue their health insurance either through COBRA, conversions contracts or HIPAA contracts – primarily due to cost. In Florida, if you are over 63 days without health coverage, you will be subject to pre-existing condition limitations. Additionally, some health plans are post claim underwriting – when a claim is submitted, insurance companies have a two year period in which to contest applications for misstatement of information so they scour applications and medical records to see if information was left out about a condition that may have previously existed. The company can then reject the entire application on the grounds that someone did not provide full disclosure.

Tort reform may or may not fix healthcare

Tort reform in Texas was supposedly passed to decrease the incentive for people with non-meritous claims to file lawsuits. The real effect however, was to decrease the incentive and the ability of those with meritous claims to file lawsuits. Our courts already have numerous mechanisms in place to dismiss non-meritous cases.

All the evidence available shows that the liability "crisis" is a myth. Malpractice payments account for less than 1% of the nation's health care costs each year. Since 1987 medical malpractice insurance costs have risen just 52% despite the fact that medical costs have increased 113%. The size of malpractice damage awards has remained steady since 1991. Adjusted for inflation, the average malpractice payment has actually decreased since then. The only evidence supporting claims of a liability crisis is anecdotal; hearsay propagated by lies from malpractice insurers who tell doctors their premiums are high because of out-of-control malpractice claims. Yet, data show that the medical liability system produces rational outcomes. (Andrew Sullivan, The Atlantic, 8/21/2009)

Malpractice reform effort must balance the interests of injured patients, doctors, and the insurance industry, all while recognizing the universal goals of lowering costs, improving access, and ensuring quality. The goal of stabilizing malpractice premiums may not align with the goals of tort law: improving quality by deterring future incidents of negligence and providing fair compensation for those injured. Despite these challenges, there is no shortage of reform proposals.

Most tort reform legislation, at both the state and federal levels, is centered on capping award payments. Capping awards may provide juries with a more consistent framework, but critics argue that capping at some arbitrary level will inevitably result in underpayment for some actual victims with minimal effect on premiums. (By William M. Sage, M.D., Margaret Thompson, Cynthia Gorman, Melissa King | June 12, 2008)