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September 20, 2010

Washington Health Policy Week in Review Archive 59793f17-dd9b-4ffb-a15f-02e2b4a647e7

Newsletter Article


Record-High Uninsured Rate Fuels Partisan Feud over Health Care

By Rebecca Adams. CQ HealthBeat Associate Editor

September 16, 2010 -- The percentage of people living in the United States without health insurance rose to 16.7 percent in 2009, the highest rate since the Census Bureau began collecting data in 1987 and an increase of 1.3 percentage points over 2008 levels, according to a report released Thursday.

The previous record high was 15.8 percent, a rate reached in 1998 and 2006.

Census Bureau officials attributed much of the decline to the economic downturn as people lost full-time jobs that came with health coverage and then either remained unemployed or were forced to take jobs without benefits.

The number of people with health insurance actually fell for the first time since the bureau began analyzing health insurance data. The number of people who did not have insurance rose above 50 million for the first time — to 50.7 million in 2009. That's up from 46.3 million in 2008.

The decline would have been more precipitous if Americans had not been able to move into such government health programs as Medicaid, the federal-state health program for the poor; the State Children's Health Insurance Program, for the low-income children not eligible for Medicaid, and Medicare, the federal program for the elderly and people with disabilities.

President Obama said the children's health program "helped inoculate our children from the economic distress experienced by their parents, as there was little change in the percentage of children without health insurance." Obama added that the health care law (PL 111-148, PL 111-152) he signed in March "will build on that success by expanding health insurance coverage to more families."

The percentage of people covered by employment-based insurance continued to fall and hit the lowest rate in 22 years, going from 58.5 percent in 2008 to 55.8 percent in 2009.

However, the percentage of people covered by government programs —30.6 percent — was the highest since 1987. Medicaid accounted for a significant share of those government-provided benefits, reaching 15.7 percent of people in the United States.

Divergent Interpretations

Lawmakers and interest groups seized on the stark numbers to argue for their differing viewpoints on the law, which Obama signed in March.

Democrats and their allies said the numbers underscore the need for the law, which aims to expand both government-provided and employer-sponsored coverage.

"Last year, too many Americans lost their health insurance because of egregious insurance company abuses," said Senate Finance Committee Chairman Max Baucus, D-Mont. "The increase in uninsured Americans last year is clear evidence of how critical it was to to take action to protect patients, and that's exactly what the Affordable Care Act will do."

In the short term, the federal government is subsidizing coverage for people with pre-existing medical conditions and who have been without insurance for six months. The law also includes a tax credit that will temporarily help some small businesses and offers government subsidies to companies that provide retiree insurance for people who are not eligible for Medicare.

Starting in 2014, the law will require most individuals to buy insurance, will provide subsidies for low-income and some middle-class people, and will create health exchanges which will market policies under federal rules requiring minimum benefit levels.

"The health reform law will make a difference for tens of millions of people without insurance who will finally be able to afford quality health coverage," said House Ways and Means Health Subcommittee Chairman Pete Stark, D-Calif. "Republicans who want to repeal health reform have a message for them: You're on your own."

Republicans said they had a better way of handling the problem of the uninsured.

"The Republican alternative bill not only reduced the cost of insurance but reduced the number of uninsured,'' said Jim Billimoria, House Ways and Means GOP spokesman.

The Congressional Budget Office found that by 2019 under the Republican health care plan, "the number of nonelderly people without health insurance would be reduced by about three million relative to current law, leaving about 52 million nonelderly residents uninsured."

The GOP also said that some of the uninsured may be choosing to go without coverage, pointing to a 2009 study by former Congressional Budget Office director June E. O'Neill that said about 43 percent of those without policies could probably have afforded to buy them.

The census statistics showed that people were more likely to be uninsured as their incomes declined. About 26.6 percent of people whose annual household income was below $25,000 were uninsured, according to the bureau's report. At the same time, 9.1 percent of those in households with annual incomes of $75,000 or more did not have health coverage.

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Berwick Urges Insurers to Cooperate in Law's Implementation

By Rebecca Adams, CQ HealthBeat Associate Editor

September 13, 2010 -- Centers for Medicare and Medicaid Services (CMS) administrator Donald M. Berwick, in his first public address since taking office, urged insurers Monday to become partners with the administration to implement the new health care law.

Berwick, addressing a conference organized by the trade association America's Health Insurance Plans (AHIP), told the gathering of industry officials that if they stand in the way of changing the U.S. health system as the law requires, the partnership will not work.

During the health care debate, President Obama and health officials often tussled over new regulations that the law will impose on the insurance industry.

"My door is wide open," Berwick said, to anyone "who will join authentically join" the administration to update the health care system. "Those who welcome change and will agree to meet it will find a friend."

However, he said, "Those who wish only to preserve the status quo . . . cannot be effective partners."

At one point during the meeting, tensions between Obama administration health officials and the health insurance industry became clear when an industry representative questioned Berwick. He asked what the new CMS administrator would do to alleviate the image within the administration as a "villain," change the culture within CMS to "acknowledge there are forces for good within the insurance industry," and reduce the "tone of hostility" shown toward health plan executives.

"Let's look ahead, not back," answered Berwick, who was sworn in two months ago. He said that if the administration and insurers steadily work together to make care better, "trust will resurface . . . If we do this together and make care better, the rest will follow."

Several new provisions of the new law will take effect Sept. 23, six months after its signing, forcing insurers to change the way they do business. At that point, the industry will have to allow dependents to stay on their parents' coverage until age 26; stop imposing lifetime limits and rescinding coverage when patients get sick; and cover all conditions, including pre-existing medical problems, for children.

Obama and top administration officials are expected to tout these changes as the anniversary approaches in an attempt to convince the public that the health care law will benefit many Americans.

Berwick's speech offered him the chance to show both a willingness to work with the industry as well as a determination to permanently alter its business model. Obama tapped Berwick for the CMS job as a recess appointment in July after it was clear that Senate Republicans would try to block his confirmation.

Berwick said Monday that he views his job at the helm of Medicare and Medicaid as involving three tasks: running a huge health coverage system; implementing the health care law; and, most importantly in his mind, improving health care in America.

He called the health care legislation an answer to the gaps in the U.S. health care system, but said it also poses an important question "for every single person in this room."

"The question the law asks is: Will we redesign health care in America? Will we reshape it together?" Berwick said, adding that his vision is for a "responsive, continually improving health care system that's available for all Americans at an affordable cost."

After the speech, AHIP president and CEO Karen Ignagni said the health insurance executives in the room intend to be helpful and work closely with CMS as the law is implemented.

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Governors Association Chief Says States Will Create Health Care Exchange

By Rebecca Adams, CQ HealthBeat

September 15, 2010 -- Even though many governors are resisting the implementation of the new health care law this year, National Governors Association Executive Director Ray Scheppach predicted that many governors will ultimately want to create their own version of the most significant part of the new system—the exchange markets that will begin in 2014. Despite the fact that officials in some states are suing the federal government over the law (PL 111-148, PL 111-152) and some are refusing to create their own high-risk pools this year as the law envisioned, Scheppach said that governors will want control over the insurance provided in their states.

"In the end, most states will, in fact, do the exchanges," Scheppach said Wednesday at a conference organized by the trade association America's Health Insurance Plans. If a state does not set up its own system, then HHS officials could come into the area and set up an exchange market there. Under a federally created exchange, governors might have less control over how much medical providers are paid and how the insurance system operates.

"There's a strong anti-Washington attitude out there," said Scheppach.

However, he said governors' level of interest depends somewhat on the amount of flexibility that Department of Health and Human Services officials give them as they write regulations. For instance, if HHS officials base the standard benefit design of an insurance plan on the equivalent of the actuarial value of an average BlueCross BlueShield plan, many states could meet that standard. But if HHS officials are very prescriptive in laying out precise details about how benefits are covered, officials in some states could walk away from creating their own markets.

Scheppach said that "there is a two-track kind of thing" happening, with governors simultaneously moving to implement parts of the law while complaining about it and even challenging it in the courtroom. He said that the NGA recently held a meeting in Vermont to explain the law to state officials and will have another one in two weeks in Seattle.

Some policy analysts have noted that only about roughly half of the states have set up their own temporary high-risk insurance plans this year. The health care law calls for high-risk pools to be set up in every state, but officials in each state have a choice of whether to set up the system themselves or allow the federal government to create it. But Scheppach said that this year's decisions about the high-risk pools are not a predictor of whether governors will want to set up their own exchange markets four years from now, in part because different officials may be in place then and in part because governors have an interest in tailoring the systems to the needs of their own constituents.

"I do not personally think that's any indication of what will happen in the exchanges," he said.

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Study: Little Link Between Physician Information and Quality of Care

By Jane Norman, CQ HealthBeat Associate Editor

September 13, 2010 -- High-quality medical care bears little relationship to publicly available information about physicians, such as their history of malpractice claims or years of experience, according to a study published Monday in the Archives of Internal Medicine.

The study from the Rand Corporation and the University of Pittsburgh Medical School said that government public health officials advise that consumers look at such measures on state medical board websites when choosing a physician, as do popular consumer websites. But it's "unclear" whether those are really good predictors of quality of care, the authors said.

The study comes at a time when quality of care is increasingly being stressed, including in the new health care law, as lawmakers and public health officials seek to bend the health care spending cost curve while not diminishing health care provided to Americans.

The review of more than 10,000 Massachusetts physicians and the care they provided to 1.3 million adults in that state found three characteristics somewhat tied to better performance: providers who are female, those who are board-certified and those who attended U.S. medical schools. But there's not enough evidence that patients would really get better care by switching to a doctor who embodied all three qualities, the study said.

"We found that the types of information widely available to patients for choosing a physician do not predict whether that physician will deliver evidence based care," said Rachel Reid, the lead author, in a statement. "These findings underscore the need for better physician performance data to help consumers choose their doctor."

The study points to a "serious problem" for consumers who are looking at public information that's not relevant and even possibly misleading, said Anne-Marie Audet, vice president for health system quality and efficiency at the nonprofit Commonwealth Fund, which helped pay for the study with the U.S. Department of Labor.

Board certification was the one element that did stand out somewhat in connection with quality care in both acute and preventive circumstances, the study indicated, suggesting some "preliminary evidence" that there may be benefits from maintenance of doctor certification programs or board certification activities as a condition of maintaining licenses.

Reporting of individual physician quality data "may provide the consumer with more valuable guidance when seeking providers of high-quality health care," the study said.

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Public Health Money Starts to Flow—but from Overhaul Law Fund Targeted by Republicans

By John Reichard, CQ HealthBeat Editor

September 13, 2010 -- Twenty-seven public health training centers across the country will receive $17 million in funding under grants announced Monday by the Department of Health and Human Services, the first wave of funding under the health care overhaul law to help reverse budget declines for public health programs, advocates say. But the money is coming out of a preventive care and public health fund that has a big target on its back, the advocates add.

The grants, which include $15.4 million from the preventive care fund established by the health care overhaul law (PL 111-148, PL 111-152), will be used to train workers to engage with the public on a wide variety of health issues.

"Whether facing public health emergencies such as natural disasters, or chronic conditions like obesity, a well-trained public health workforce is critical to ensuring the nation's health and welfare," said Mary Wakefield, the administrator of the Health Resources and Services Administration in an announcement Monday. HRSA is the agency that oversees the training centers, which are housed at nonprofit institutions, including schools of public health.

The Prevention and Public Health Fund created by the overhaul law also is expected to fund preventive care programs tailored by local communities to meet their own health care needs as well as programs to help smokers quit, among many other activities. Senate appropriators recently voted to add $750 million to the fund in fiscal 2011. It includes some $15 billion in mandatory funding over a 10-year period.

But public health groups worry that Republicans critical of the overhaul law will eliminate the fund. Sen. Mike Johanns of Nebraska, for example, is expected to offer an amendment Tuesday that would eliminate the fund to help pay for dropping a requirement that businesses file 1099 forms with the IRS to cut down on tax cheating by their vendors.

Rich Hamburg, deputy director of Trust for America's Health, said in an interview Monday that the public health training grants are "the first money that's coming available to help turn around the pretty dire situation that the public health workforce is in." The trust advocates increased funding of public health programs.

"I'm cautiously optimistic that the votes aren't there" to pass the Johanns amendment Tuesday, Hamburg said. But "I think we have to look at the long term," he added. "It's a big fund and it seems to have a bull's-eye on it. We fully expect that there will be other efforts to divert the funds. It's not going away with this one amendment."

Hamburg said some 250 public health, union, and other groups have sent a letter to senators opposing elimination of the fund. They view the Johanns amendment as just the first of repeated efforts to take money out of the fund or to eliminate it, Hamburg said.

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Health Care Law's Advocates Point to 'Tax Cut' on the Way

By Jane Norman, CQ HealthBeat Associate Editor

September 14, 2010 -- As Congress fights over whether to extend expiring Bush-era tax cuts, a group that has backed the health care law released a report on Tuesday that characterizes a health tax credit due to go into effect in 2014 as a "huge middle-income tax cut."

The report from Families USA said that the new refundable tax credits will go to an estimated 28.6 million Americans, with a total value for the tax credits in 2014 of $110 billion. Most recipients will be people with jobs, and many will be employed by small businesses, said the report.

"Right now there's ample conversation taking place in Washington about tax changes, so the report we are about to release is quite timely," said Ron Pollack, head of Families USA, in a briefing with reporters.

The health care law has not provided the bump in political support that Democrats wanted as they approach the midterm elections, and studies such as the one from Families USA give advocates a chance to shine a light on portions of the law that they believe are misunderstood or unknown.

At the same time, popular provisions due to go into effect on Sept. 23, including those clamping down on insurance industry abuses and expanding coverage, are in for a big shot of publicity in the next two weeks.

Pollack said the health tax credit report isn't tied to any specific developments in connection with the law or demands from Republican congressional candidates to "repeal and replace" it, but rather is part of a Families USA myth-busting roadshow that has toured across the country. Pollack said members of the group have found that misconceptions abound. "I remember one of the seniors asking a question about death panels, still," he said.

The lack of knowledge extends to provisions still far in the future. "I'm not sure that people even understand what an exchange is, today," said Pollack, referring to the health insurance marketplaces that will be established by 2014 to help consumers and small businesses purchase coverage. But as the law is explained, "I believe we're going to see, over time, support for health reform grow," he said.

The report, assembled by the Lewin Group for Families USA, says that people in working families with incomes at or above 200 percent of poverty level, or $44,100 for a family of four in 2010, will make up two-thirds of those eligible for the premium tax credit. Those on the lower end of the scale, though, will receive the largest credits, said Pollack. "This is one of the largest middle-income tax cuts in history," he said.

Rep. Pete Stark, D-Calif., chairman of the Health Subcommittee of the Ways and Means Committee, praised the findings in the context of the drive to roll back the health care law. "Congressional Republicans would repeal these tax credits — raising health care costs for working families and jeopardizing coverage for tens of millions of Americans," Stark said in a statement.

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