Will Universal Coverage Mean “Medicaid for All”?
Often, I refer to the health care reform bill that President Obama signed into law in March of 2010 as “the Affordable Care Act” or ACA. Friday, as I read the Institute of Medicine’s (IOM’s) report on the “Essential Health Benefits” (EHB) that private insurers will be required to cover under reform, I resolved never to make that mistake again.
The lawmakers who crafted the legislation called it the “Patient Protection and Affordable Care Act” (PPACA) and with good reason. The first goal of the legislation is to protect patients by ensuring that they have access to all of the health care that they need. Yet the IOM committee charged with proposing how the Department of Health and Human Services (HHS) should go about defining “essential benefits” made “Affordable” its first priority. “Patient Protection” trails, in second place.
The summary of the report makes this clear when it suggests that “one way to think about the EHB package is to compare HHS’s task to going grocery shopping. One option is to go shopping, fill up your cart with the groceries you want, and then find out what it costs. The other option is to walk into the store with a firm idea of what you can spend and to fill the cart carefully, with only enough food to fit within your budget. The committee recommends that HHS take the latter approach to developing the EHB package.”
I have talked to two of the experts who served on the 18-member IOM committee: Marjorie Ginsburg, Executive Director of the Center for Healthcare Decisions, and James Sabin, a Clinical Professor in Harvard Medical School’s Departments of Psychiatry and Population Health, who is also Director of the Harvard Pilgrim Health Care Ethics Program. Those conversations have convinced me that the committee did not necessarily intend to make “cost” the main theme of a report which is actually sub-titled “Balancing Coverage and Cost.”
As Sabin and Ginsburg pointed out to me, the full report is far more nuanced than the introductory summary suggest. Yet few will ever read the full 300-page report. When it was released, most journalists only had time to read the 4-page “Report Brief”–especially after an overly ambitious blogger broke the embargo on the full report late Thursday. (This meant that journalists were working hard to get the story in newspapers Friday morning, before the formal release of the report later in the day.)
The 4-page summary puts costs up front, and the grocery-shopping analogy pops off the page. It’s easy to grasp and it seems to make sense. As a result, media headlines, like this one from the Washington Post, sum up IOM’s message this way: “Health-care law benefits must be limited to ensure affordability.”
Defining “Essential” as the Benefits Small Employers Offer
Yet while the summary may not do justice to the full report, the truth is that the report does downsize the required benefit package by recommending that it should be modeled on the “scope and design” of packages that “small employers offer today.” By contrast, the Patient Protection and Affordable Care Act suggested that “essential benfits” should mirror the coverarge that Americans receive through their employers. Most observers assumed this meant that, under reform, everyone would be able to count on the standard benefits that the majority of U.S. workers now receive from large to mid-sized firms.
But instead, the IOM committee chose the package that small employers can afford, which is typically less generous. One way to measure the difference is to look at premiums. According to the Kaiser Family Foundation in 2011, family coverage offered by small employers (with 3 to 199 employees) averaged $14,000, with the employer contributing a little over $9,000 and the worker chipping in roughly $5,000. By contrast, family coverage offered by large employers cost $1,500 more, or $15,500, with the employer contributing $11,700 and the employee kicking in $3,700.
Let me be clear: Harvard’s Jim Sabin argues that if we excised some of the waste from our health care system, we should be able to provide high-quality family coverage for $14,000 — and I agree. But the report suggests that “essential benefits” should be based on the “scope and design” of the policies that small firms offer. Here, we’re talking about just how comprehensive the policies that for-profit insurers sell on the Exchanges must be.
What is omitted from the small employer package? Kaiser offers several examples, including “smoking cessation programs (offered by 31% of small firms vs. 63% of larger firms), and weight-loss programs (28% vs. 53%.) The IOM committee also looked into the “scope” of these plans, and the report explains that there is little data available on “typical benefits” in the packages small employers provide. But the group did manage to collect information from three major insurers. An Appendix to the report reveals that the following services:
- hospice care
- drugs that help smokers quit smoking
- services for autistic children
- hearing exams and hearing aids
- diabetes care management
are less likely to be included in the plans that small companies offer.
How the PPACA Contradicts Itself– the Committee’s Solution
The IOM committee points out that health care reform legislation lists “10 general categories of health services” that should be considered “essential”:
• Ambulatory patient services
• Emergency services
• Maternity and newborn care
• Mental health and substance use disorder services, including behavioral health treatment
• Prescription drugs
• Rehabilitative and habilitative services and devices
• Laboratory services
• Preventive and wellness services and chronic disease management
• Pediatric services, including oral and vision care
Yet, the committee observes, “standard” packages offered, not just by small companies, but by large employers, often do not cover mental health and substance abuse services, dental and vision care for children, some wellness services, and chronic disease management.
In other words, the Patient Protection and Affordable Care Act contradicts itself. It says that the policies offered in the Exchanges should be modeled on employer-based insurance, and at the same time stipulates that these policies must cover 10 areas that even the insurance offered by large corporations often doesn’t cover.
The IOM report suggests that HHS will need to modify the typical package offered by a small employer to include these 10 broad categories. But at the same time the report clearly states: “Every service or item that might be classified in the 10 categories is not essential.”
What does this mean?
The commitee is quite candid. In the report, it acknowledges that “Taken together, these provisions complicate the task of designing an EHB package . . . The Committe’s solution is to begin with what small employers cover, and then modify the package to include the list of ten–while keeping in mind that everything which logically would be included in one of these categories need not be in the package.”
Ultimately, the report proposes that HHS “build on what currently exists” for employees working at small firms, “learn over time, and make it better. That is, the initial EHB package should be a modification of what small employers are currently offering.”
What Patients Want vs. What They Need
This morning, when I talked to Marjorie Ginsburg, I asked her to explain how one can reconcile the list of 10 essential areas with the notion that the scope of the benefits should mirror a typical employer plan.
Ginsburg replied: “The ball is back in HHS’ court.”
She also emphasized that the committee was concerned, not just with “affordability” but with making sure that the benefit package promotes “evidence-based care.”
Here, of course, I wholeheartedly agree. “Patient protection” legislation was never intended to guarantee that all Americans will receive all of the health care that they may want. As I noted in a recent post, both Medicare and private insurers now cover many services and products that we are beginning to realize offer little or no benefit to many patients–and in fact may actually harm them.
Yesterday, for instance, the United States Preventive Services Task Force issued a draft recommendation saying that healthy men should no longer receive routine P.S.A. blood tests to screen for prostate cancer. “Medical evidence has shown that the test does not save lives over all and often leads to more tests and treatments that needlessly cause pain, impotence and incontinence.” This advice is based on the results of five well-controlled clinical trials. The Task Force did not take cost into account when making its decisions. Its counsel is based solely on what medical evidence reveals. (I wrote about PSA testing back in the summer of 2007 when I began this blog.) I am impressed that the USPSTF summoned the political courage needed to announce this decision. Too many men have been hurt by unnecessary treatments for a cancer that grows so slowly that most will never experience symptoms.)
In the end, I would suggest, “essential benefits” should include all treatments that medical research suggests will benefit patients who fit a particular medical profile. This is the care that everyone needs– which may be different from what they think they need– when they don’t have the facts about risks and benefits. ( “Shared decision-making” research reveals that when men are given straight information about the risks of PSA testing, and the possible benefits, as well as the low odds that their early-stage prostate cancer will cause problems in the future, a great many decide against the test.)
“Medicare for All” or “Medicaid for All” ?
Still, I fear that there is a real possibility that “universal coverage” will wind up looking like “Medicaid for All.”
The report draws a parallel between “essential benefits” and “Medicaid benefits” when it points out that some people will move back and forth between Medicaid and a policy that they purchase in the Insurance Exchanges as their income goes up and down. The committee advises that HHS should strive for “consistency” between benefits covered by Medicaid and benefits that must be covered by all policies sold in the Exchanges.
Here, the panel raises a crucial question: Does this mean that “the Exchange benefits” should look like Medicaid, or that Medicaid should be changed (and presumably expanded) so that the benefits offered to the poor resemble benefits included in insurance plans sold in the Exchanges? The committee does not try to answer that question, but my guess is that if the states have anything to say about it (and they will), we are not likely not see Medicaid benefits enriched.
Moreover, the very first paragraph of the Report Brief seems to suggest that when we talk about “essential benefits,” we may be talking about a “poor program for the poor.” Under the PPACA, the Committee writes: “private health insurance plans will be offered to low- and moderate-income individuals and small employers through state-based ‘purchasing exchanges,’ often with financial help.”
“Wait a minute,” I asked Ginsburg, “won’t high income individuals who don’t have employer-based insurance(including the self-employed), also be shopping in the Exchanges?”
“Why, yes, they will,” she replied, sounding a little startled
Why, then, does the report suggest that “Essential Benefits” applies mainly to low-income and middle-income families? Probably because the Essential Health Benefit package package is meant to define “a minimum set of benefits that the plans must cover.” But, as the report notes, “insurers may offer additional benefits.” Presumably, wealthier Americans shopping in the Exchanges will pick richer plans that cost more, and offer more.
Meanwhile, there is the danger that “essential benefits” for most Americans will turn out to be “bare bones” coverage. No smoking cessation programs– even though the majority of U.S. adults who smoke are poor. If they develop lung cancer or emphysema, we all pay for their care through Medicare or Medicaid. Even from a purely economic perspective, this makes little sense. No hearing exams or hearing aids, despite the fact that low-income individuals are less likely be able to afford to pay for a hearing aid out-of-pocket. And if you cannot hear, most likely you will find it difficult to land a job. Research reveals that the poor also are more likely to suffer from mental health and substance abuse problems. Finally, consider children. Many low-income and middle-class children need eyeglasses, yet the report points out that insurance plans offered by smaller companies often do not cover pediatric vision care. Does this mean eye care for children will not make the cut?
What About Palliative Care?
Let me add that the problem is not just that the ten areas that the PPACA names may not be fully covered; there are some notable holes in that list. First, the legislation explicitly mentions “vision care” for children in a way that suggests that eye care for adults need not be part of EHB. Granted, many commercial insurance policies do not reimburse for eye check-ups unless you are suffering from glaucoma or another disease. But how do you find out that you are developing glaucoma, or acute macular degeneration (which is likely to become the leading cause of blindness among baby boomers), unless you are able to afford regular eye appointments?
The other, more glaring, omission is palliative and hospice care. Ultra-conservatives smeared the idea of end-of-life counseling with the label “death panels,” and Congress backed away from explicitly including such counseling in heath reform legisation– let alone making palliative care and hospice care part of the program.
Yet many would agree that we all should have the right to die as we choose– and this means that no one should have to die strapped to a bed in an ICU, or writhing in pain in a hospital bed. Everyone should be offered a chance to take advantage of the comfort that palliative and hospice care can provide.
When I asked Ginsburg about end-of-life care, she replied: “Just because something isn’t listed in the 10 areas doesn’t mean it won’t be covered. We discussed adding to the list of ten areas that must be covered,” she added, but the commitee decided it just wasn’t feasible to try to make those decisions.”We met only four times,” she pointed out.
Ginsburg underlines the role that the public is supposed to play as HHS finalizes the list. HHS has called for “listening sessions” where Americans from across the country can express their priorities. “’Public deliberation’ asks people to weigh alternative options against what they value most and to consider the costs and consequences of their choices,” says Ginsburg. “A public deliberation process can help ensure that the final essential health benefits package reflects the perspectives of the American public who will be most affected.”
While I applaud the idea in the abstract, when it comes to questions of “value,” not to mention “values,” this nation is so polarized on so many levels, that I suspect it will be very difficult to reach a consensus on questions of end-of-life counseling, or whether smokers should show “personal responsibility,” and quit smoking on their own, without expecting help in the form of drugs or smoking cessation programs.
Ditch the Grocery Store Metaphor
Finally, I would suggest that HHS drop the notion that defining essential health benefits is a lot like shopping for groceries. As I argued in a recent post, Science should determine what care is covered, both under Medicare, and under universal coverage of younger Amerians. This means that all effective care should be included, using “comparative effectiveness research” to sort out which treatments will help which patients.
At some point down the road, will we have to look at “cost-effectiveness” as well as “comparative effectiveness,” and begin ruling out treatments that can help patients, but are, by some measure, too expensive? Conceivably. For example a course of chemotherapy that costs $100,000 and gives the average patient only a week or two of additional life might well fall into the category of treatments that are not “cost-effective”–even though some patients might live for an extra six months. But what about one-on-one counseling for autistic children? Organ transplants for adults over 70? Costly, agressive interventions for premature or very sick infants when the odds that they will survive are slim–yet far from non-existent?
These are questions for medical ethicists. But I don’t believe that we, as a society, must face them today. Keep in mind that the consensus among both physicians and medical researchers is that one-third of our heatlh care dollars are squandered on unnecessary, redundant, over-priced, ineffective and sometimes unwanted treatments.
First, let’s see how much waste we can squeeze out of the system. At that point, I believe that we will find that we have enough money to provide a new and improved evidence-based version of Medicare-for-Everyone– including everything now covered by Medigap and Medicare Advantage. This is what most other developed countries do now, while spending far less per patient than the U.S.
Those who believe that health care reform should begin by determining how much we are willing to spend usually don’t talk about removing waste from the system. This may be because conservative politicans often represent those who benefit from the excesses in U.S. healthcare– either by profiting from unnecessary treatments that they sell, or by receiving the overtreatment that they are convinced they need and deserve — whether in the form of PSA tests, fully body scans, or angioplasty to provide temporary relief from angina.
Many over-treated and well-insured Americans truly believe that they are entitled to all of the care that they think they need. After all, they–or their employers–are willing to pay for the most expensive insurance. Why shouldn’t they receive everything that 21st century medical technology has to offer? What they don’t realize is that all of us help pay for their over-treatment–through our own higher insurance premiums, and eventually, through higher Medicare co-pays, deductibles and taxes.
One might resent that sense of entitlement, yet here is the irony: Those who demand unnecessary care are, in fact, putting thier own health at risk.