Comparing the Health Plans

Over the weekend the House of Representatives narrowly passed a health care reform bill that would cost approximately $1.1 trillion over 10 years and insure approximately 36 million Americans who currently do not have coverage. The action now turns to the Senate Conference Committee, where the work begins to consolidate the House and Senate bills.

For some assistance in understanding the differences that need to get worked out, the New York Times offers a helpful interactive web page. We offer an example below:

Require nearly all Americans to carry health insurance or pay a penalty

House version
Would include mandate.

Penalty: 2.5 percent of adjusted gross income over a certain level, which is $9,350 for singles and $18,700 for couples.

Exempt those with incomes below the above-mentioned thresholds, American Indians, people with religious objections and people who can show financial hardship.

Senate Health Committee
Would include mandate.

Penalty: Up to $750 a person a year.

Exempt American Indians and those who can show financial hardship.

Senate Finance Committee
Would include mandate.

Penalty would be phased in gradually: $200 a person in 2014; $400 in 2015; $600 in 2016; and $750 in 2017.

Exempt American Indians, people with religious objections, those who can show financial hardship, households with incomes lower than 133 percent of the federal poverty level ($29,327 for a family of four) and people who would have to pay more than 8 percent of their income to buy the lowest cost plan available to them.

White House
Open to a mandate as long as people who cannot afford insurance are exempt. During the campaign, President Obama proposed mandates for children only.

“I am open to your ideas on shared responsibility. But I believe if we are going to make people responsible for owning health insurance, we must make health care affordable. If we do end up with a system where people are responsible for their own insurance, we need to provide a hardship waiver to exempt Americans who cannot afford it.” (Letter to Senate leaders, June 3)

Interest groups
America’s Health Insurance Plans, the insurers’ lobby, supports individual mandates. But the trade association says the penalties for going without coverage are modest under the Senate Finance Committee’s bill. This creates “a powerful incentive for people to wait until they are sick to purchase coverage,” and could drive up insurance premiums, the group has warned.

Drug companies and insurers could benefit from mandates, which could provide millions of new customers.

Labor unions and consumer groups support mandates for individuals as long as employers are required to help pay for coverage.

Facing Higher Health Costs

In the health care reform debate, the escalating cost of health care is cited as one of the primary reasons for reform. And the rapid rise in the cost of health care is often attributed to the reimbursement model and that people who receive health insurance through an employer or through the state are insulated from the actual price tag for the care they receive. Many contend that if more consumers were directly responsible for a larger portion of the cost of care, then they would influence the marketplace and costs would go down. However, some consumer advocates insist that if employees shoulder a greater share of cost, then they will avoid preventive care and drive costs up, in addition to being unable to afford the care they need.

An article titled “Employees face 'shockingly higher' health costs” by Parija Kavilanz posted today on CNNMoney.com examines the growing trend of employers shifting the cost of health coverage to employees.

It's open enrollment time at work. Prepare yourself. Starting in 2010, your employer is making sure that when it comes to paying for your health care, you're going to be sharing much more of the burden.

"The headline is greater cost sharing," said Tom Billet, senior consultant with human resources consultancy Watson Wyatt. "That means higher [employee] contributions, higher deductibles, or both," he said.

In 2010, employers are "putting everything on the table," implementing benefit changes aimed at making workers more aware of the actual cost of services," said Paul Fronstin, director of the health research program at the Employee Benefit Research Institute (EBRI), a public policy research group.

Barry Schilmeister, health care consultant with Mercer, a global firm specializing in employee benefits, agrees.

"Most people are shielded from the true cost of care because all they pay when they go to the doctor is a $15 to $20 co-pay," he said. "To me the catch phrase in 2010 will be 'Taking responsibility.' "

Consumer advocates, however, aren't thrilled with these declarations.

"We recognize that this is a hard economy," said Cheryl Fish-Parcham, deputy director of health policy with Families USA, a health care consumer advocacy group.

"We know that medical debt is growing. We know that [employer-based] coverage is thinning," said Fish-Parcham. "This is a really difficult environment for everyone. That's why we're all looking forward to health reform."

…

Higher out-of-pocket costs
"Employers and employees will face shockingly higher [health care] costs," warned Helen Darling, president of the National Business Group on Health, whose members include Fortune 500 companies such as American Express, Coca-Cola and IBM.

Companies are raising deductibles, co-payments and employee out-of-pocket limits. "In better economic times, employers are better able to shoulder the [health care cost] burden. Not as much now," said Billet, who estimates that costs could increase between 10 to 20% for insured workers.

Besides the economy, Billet said other underlying factors driving up health care costs include aging of the population, greater use of technology in health care and government cost-shifting.

"Medicare and Medicaid typically pays providers less than the actual cost of care," he said, adding that providers make up the difference by raising their rates to their insured clients.

Co-pay to co-insurance
Darling said companies have been shifting over the past five years from a co-pay, a flat dollar fee ranging between $10 and $35 that employees pay at each doctor visit, to a to co-insurance model.

With co-insurance, employees pay a percentage of the total medical expense. Experts say co-insurance rates are typically split 80-20 or 70-30 between the health plan and the insured worker.

"By changing to co-insurance, people are more aware of costs and the hope is that they'll be more careful about how they spend their [health care] dollars," said Schilmeister.

Billet, whose corporate clients include Time Warner, the parent company of CNNMoney.com, said co-insurance used to be the norm prior to the advent of health management organizations (HMO). "So it's almost like a back to the future," he said. Time Warner is shifting from a co-pay to a co-insurance model next year.

…

Consumer-directed health plans
About 20% of large employers offer consumer-directed health plans (CDHP), up sharply from 14% last year, according to Mercer.

These plans, which couple catastrophic illness coverage with employee-funded health savings accounts (HSA) or health reimbursement accounts (HRA), are 20% less expensive than traditional preferred provider organizations (PPOs) and HMOs, said Schilmeister. CDHPs usually have much lower premiums, although the deductibles are higher than other options. Some employers do help workers with the high deductibles by contributing money into their HSAs.

Still, Schilmeister said CDHPs probably make more sense for a healthy worker who doesn't utilize medical care frequently. Otherwise they can be expensive for employees.

"Be careful with these," said Fish-Parcham. "If employers aren't funding your HSA, it can become a huge problem especially for lower-income workers."

If employers increasingly shift health coverage costs to their employees, as those quoted in this article predict, what will be the impact on the cost and quality of health care in this country and the reform efforts in play in Washington?

A Different Kind of Public Option

Catholic Healthcare West co-led the task force that designed the nation's only public health care option for uninsured residents. It's not insurance in the traditional sense; it uses the medical home model to ensure that care is available (including hospitalizations) to all who need it.

The New York Times recently published a Q&A with William Dow, a health economics professor at the University of California, Berkeley, who is studying Healthy San Francisco. Here are a few excerpts:

Q. Healthy San Francisco is not a single-payer system, but it does seem to offer much more than is available to the uninsured in most U.S. cities. What were the origins of this program?

A. It was an initiative of Mayor Gavin Newsom and the San Francisco Board of Supervisors to provide universal access to health care for the uninsured.

Q. Has it done that?

A. There were about 60,000 uninsured adults in the city when Healthy San Francisco came into effect in July 2007. Since then, 45,000 have signed up.

Q. To be clear, this isn’t insurance per se.

A. No. The city is careful not to call it health insurance. It provides access only to health care within San Francisco and only at a specified set of providers, mostly safety-net providers. If you get sick outside the city, you’re in trouble. It’s more like an insurance plan with a geographically restricted network.

It started by covering only those under the poverty line. Then in January 2008, it expanded to those making up to 300 percent of the poverty level. Now that’s been extended to 500 percent of the poverty level, which qualifies the vast majority of uninsured individuals in the city. Five hundred percent would work out to an income of about $54,000 for an individual, or $110,000 for a family.

Q. What kind of fees do people have to pay to participate?

A. There is a participant fee, which is like a premium. Under 100 percent of the poverty line, you pay no participant fee. The next group — 100 to 200 percent of poverty — pay $60 per quarter, or $240 a year. That’s for an individual. It’s capped, so that no family has to pay more than 5 percent of income.

In addition, there is a co-pay of $10 for general care, $20 for specialty care, $5 for prescription drugs on the formulary, or $25 for those not on the formulary. For hospital admission, you have to pay $200. It’s not huge, but for those with the lowest income, it’s not trivial, so those under the poverty line are exempted from the co-pays.

Q. Are enrollees happy with the program?

A. The Kaiser Family Foundation did a survey and found people think they’re better off than they were before. Overall, 94 percent said they were satisfied with the program, which is quite impressive. But some of those people aren’t well informed about program restrictions. For example, about one-third did not know that the program does not provide access to care outside of San Francisco.

Q. How’s the quality of care?

A. The providers give high quality medical care. But the typical health-care user doesn’t rate health care on adherence to evidence-based medicine or the latest medical guidelines. They have different patient satisfaction metrics. The public has a perception that safety-net providers are lower quality because they have longer queues for service and a particular demographic uses them. These aren’t facilities that have invested in soaring atriums and beautiful physical plants. So the city is pleased that a few private providers, such as Kaiser Permanente, have now agreed to join the provider network.

Q. This obviously is a different type of public option than we’re discussing on the federal level. Do you see it as an alternative?

A. I’ve made the argument for that. The current versions of the public option in Congress are threatening to insurers. If a public option were designed to be attractive only to the lowest income individuals, it would be much less threatening to the health care industry. This could easily be accomplished by giving anyone the public option of buying into their state Medicaid program. It’s a very sensible way to craft a compromise around a public option, but it’s not gotten much traction at this point. Public-option supporters haven’t wanted to backpedal to something like this, but I fear that lower-income folks will lose out if we let the perfect be the enemy of the good.

Preventing the Spread

Prevent the spread of H1N1, this doctor's rap goes viral:

House Resolution 441

Today, the U.S. House of Representatives passed House Resolution 441 in honor of the Catholic sisters in the United States. As an organization founded and sponsored by Catholic sisters we would be remiss if we let this honor pass without bringing it to our readers:

HRES 441 EH
H. Res. 441
In the House of Representatives, U. S.,
September 22, 2009.

Whereas the social, cultural, and political contributions of Catholic sisters have played a vital role in shaping life in the United States;

Whereas such women have joined in unique forms of intentional communitarian life dedicated to prayer and service since the very beginnings of our Nation’s history, fearlessly and often sacrificially committing their personal lives to teaching, healing, and social action;

Whereas the first Catholic sisters to live and work in the United States were nine Ursuline Sisters, who journeyed from France to New Orleans in 1727;

Whereas at least nine sisters from the United States have been martyred since 1980 while working for social justice and human rights overseas;

Whereas Maura Clark, MM, Ita Ford, MM, and Dorothy Kazel, OSU were martyred in El Salvador in 1980;

Whereas Joel Kolmer, ASC, Shirley Kolmer, ASC, Kathleen McGuire, ASC, Agnes Mueller, ASC, and Barbara Ann Muttra, ASC were martyred in Liberia in 1992;

Whereas Dorothy Stang, SNDdeN was martyred in Brazil in 2005;

Whereas Catholic sisters established the Nation’s largest private school system and founded more than 110 United States colleges and universities, educating millions of young people in the United States;

Whereas there were approximately 32,000 Catholic sisters in the United States who taught 400,000 children in 2,000 parochial schools by 1880, and there were 180,000 Catholic sisters who taught nearly 4,500,000 children by 1965;

Whereas today, there are approximately 59,000 Catholic sisters in the United States;

Whereas Catholic sisters participated in the opening of the West, traveling vast distances to minister in remote locations, setting up schools and hospitals, and working among native populations on distant reservations;

Whereas more than 600 sisters from 21 different religious communities nursed both Union and Confederate soldiers alike during the Civil War;

Whereas Catholic sisters cared for afflicted populations during the epidemics of cholera, typhoid, yellow fever, smallpox, tuberculosis, and influenza during the 19th and early 20th centuries;

Whereas Catholic sisters built and established hospitals, orphanages, and charitable institutions that have served millions of people, managing organizations long before similar positions were open to women;

Whereas approximately one in six hospital patients in the United States were treated in a Catholic facility;

Whereas Catholic sisters have been among the first to stand with the underprivileged, to work and educate among the poor and underserved, and to facilitate leadership through opportunity and example;

Whereas Catholic sisters continue to provide shelter, food, and basic human needs to the economically or socially disadvantaged and advocate relentlessly for the fair and equal treatment of all persons;

Whereas Catholic sisters work for the eradication of poverty and racism and for the promotion of nonviolence, equality, and democracy in principle and in action;

Whereas the humanitarian work of Catholic sisters with communities in crisis and refuge throughout the world positions them as activists and diplomats of peace and justice for the some of the most at risk populations; and

Whereas the Women & Spirit: Catholic Sisters in America Traveling Exhibit is sponsored by the Leadership Conference of Women Religious (LCWR) in association with Cincinnati Museum Center and will open on May 16, 2009, in Cincinnati, Ohio: Now, therefore, be it

Resolved, That the House of Representatives--

1. honors and commends Catholic sisters for their humble service and courageous sacrifice throughout the history of this Nation; and
2. supports the goals of the Women & Spirit: Catholic Sisters in America Traveling Exhibit, a project sponsored by the Leadership Conference of Women Religious (LCWR) in association with Cincinnati Museum Center and established to recognize the historical contributions of Catholic sisters in the United States.

Answers to Your Health Reform Questions

The Detroit Free Press publishes a helpful Q&A today on the health care reform debate. It's notable for its straight-forward tone and lack of unecessary adjectives. If you're ever in doubt about a health reform claim you've been hearing, you can always check out www.politifact.org or www.factcheck.org to decipher fact from fiction.

For now, a few of the more salient pieces from the Detroit Free Press' article:

Do we need health care reform? Health care expenses in the United States have been rising a lot faster than either inflation or wages, and there is no end in sight. National health spending is expected to be about $2.5 trillion this year—approaching 18% of the U.S. gross domestic product. The Business Roundtable, a group of top American CEOs, says health care costs for employers will rise 166% over the next decade to more than $4.4 trillion if something doesn’t change. Meanwhile, the trust fund that pays for Medicare—the nation’s biggest health care program, mainly for seniors over age 65—could run out of cash by 2017 if ways aren’t found to reduce the increase in health care costs.

But doesn’t the U.S. have the best health care in the world? That depends on who you ask and how you measure it. The World Health Organization, in a 2000 report, ranked the U.S. system 37th in the world (France and Italy were No. 1 and 2, respectively), but the report took into account the issue of “financial fairness.” And by that measure, socialized systems of medicine do better than private ones, like that in the United States. On the other hand, America was No. 1 in responsiveness of care, meaning we do better in getting people care when and where they want or need it. It’s also true though that the U.S. pays far more than other countries for health care but its life expectancy is lower than Japan, France, Italy, Canada, Germany and the United Kingdom.

What is this so-called public option everyone is talking about and is it a good thing? The public option would be a government insurance plan, with different levels of coverage. It would be an option on the exchange (see previous question) just like the others from private insurers and no one would be required to use the public option. It would not provide universal coverage as in other countries, such as Canada, where government provides health care to all.

Still, the public option is controversial and here’s why: Insurers argue the government would have an unfair advantage in the market and be able to undercut insurance company prices to a level where they could be driven out of business. Supporters of the public option say that’s not the case – no taxpayer money would be used to prop it up, only premiums, like other insurers – and that it’s a good way to ensure that private insurers keep their profits – and monthly premiums for their customers – down.

Will I pay less for health care? That depends entirely on what happens to health care costs, what kind of coverage you have (and through whom) and, potentially, your income. If you don’t get coverage through your job – and you’re paying for insurance that’s a big chunk of your income because of a pre-existing condition or because you make less than three times the federal poverty line—you’re likely to get a break or a subsidy. And you’ll probably pay less. On the other hand, if you don’t pay for insurance because you’re young and healthy and don’t want it, then you’re going to have to pay – like it or not.

If you have coverage through your employer, there’s a good chance your situation won’t change much. Finally, if you have a high-priced plan, it’s likely that an additional fee for that plan is going to be charged to your insurer as a way to help pay for reform, and there’s a very good chance your insurer is going to pass that fee onto you either though higher premiums, higher deductibles or lower benefits.

Does the bill provide health insurance to illegal immigrants? No. The Senate Finance bill expressly requires personal information to keep illegal immigrants out of the health care exchange. Like the House bill, it prohibits federal subsidies to illegal immigrants to help pay for insurance. But the House bill does not expressly stop illegal immigrants getting insurance through the exchange.

Dare to Imagine Better, Cheaper Care

by Lloyd Dean, President/CEO, Catholic Healthcare West

The debate over health care reform continues to heat up across the country. But the heat isn’t shedding much light. Instead of continuing to stir up fear and anxiety, let’s take a breath and reflect on why reform is needed: so that the quality of the health care you receive will get better, cost less, and be there when you need it.

Picture this scenario a few years in the future following reform: Despite having improved your health by losing weight and increasing your exercise (which you’ve accomplished through programs entirely paid by your health insurance), you are admitted to your local hospital because you’re experiencing the symptoms of a heart attack. 

Thanks to the expanded use of electronic medical records, the hospital knows you are on your way, who your doctor is, what drugs you are taking, which ones you are allergic to, and what types of diagnoses and treatments you’ve had.

Because of reform measures promoting use of the best methods of care, the physicians at the hospital are aware of the most recent studies about your condition and they have an individual care plan developed for you. Your care plan at your local community hospital is as up to date as it would have been at a research hospital. 

After you leave the hospital, you participate in a months-long integrated recovery and rehabilitation program under supervision of your primary care doctor. The program keeps you from having to be readmitted because you have followed the regimen of exercise and proper medication. 

As a result of these efficiencies, your health insurance costs are affordable. You feel better about the care you receive, your family is thrilled about your recovery, and your physician and hospital are pleased about the care they provided.

And, on top of all of this, you aren’t worried about taking that new job you are considering, because health insurance companies can’t deny you coverage based on this pre-existing condition.

A dream scenario? It doesn’t have to be if Congress achieves the reforms that can result in truly improved care for you and your family.

Today, our health care delivery system is too fragmented to achieve optimum results. Handwritten records, cryptic insurance forms, confusion about primary or specialist coverage, and a stifling layer of laws and regulations make it virtually impossible to provide integrated medical care.

That can change for the better. The health reform proposals being considered in Congress contain a number of vital measures that can give us the health care future we all want:

• A focus on quality by establishing best care protocols and sponsoring research programs to spur treatment innovations;
• Incentives that reward improved care rather than redundant procedures;
• The use of electronic medical records, by a greater investment in information technology;
• Coordinated care among providers;
• A focus on preventive care that provides the right care at the right time in the best setting;
• Evidence-based care that reduces health disparities; and
• Health insurance portability so that changing jobs or moving to a new city or state doesn’t jeopardize an individual’s continuity of care.

Of course, the health care debate encompasses broader issues of program funding, cost reduction initiatives, and expanding coverage to the uninsured. These issues have provoked a heated battle in Washington, DC precisely because of their scope and impact on the federal budget and everyone in the United States.

We may be weary of watching the political maneuvering associated with reform. But all of us have a deep and vested interest in policies that ultimately affect our own health, as well as the health of our country’s economy.

At Catholic Healthcare West, we hope that everyone will take a break to look beyond the headlines and bickering. Think about how health reform can dramatically improve the lives of you and your family. We think that after a closer look, and a renewed focus on the objective, people will breathe easier about the idea of reforming our health care system.

Shamans in the Hospital

The New York Times featured CHW's Mercy Medical Center in Merced, Calif. on Sunday. The story focuses on the multicultural care offered at the hospital, specifically within the Hmong community.

The patient in Room 328 had diabetes and hypertension. But when Va Meng Lee, a Hmong shaman, began the healing process by looping a coiled thread around the patient's wrist, Mr. Lee's chief concern was summoning the ailing man's runaway soul.

“Doctors are good at disease,” Mr. Lee said as he encircled the patient, Chang Teng Thao, a widower from Laos, in an invisible “protective shield” traced in the air with his finger. “The soul is the shaman’s responsibility.”

At Mercy Medical Center in Merced, where roughly four patients a day are Hmong from northern Laos, healing includes more than IV drips, syringes and blood glucose monitors. Because many Hmong rely on their spiritual beliefs to get them through illnesses, the hospital’s new Hmong shaman policy, the country’s first, formally recognizes the cultural role of traditional healers like Mr. Lee, inviting them to perform nine approved ceremonies in the hospital, including “soul calling” and chanting in a soft voice.

The policy and a novel training program to introduce shamans to the principles of Western medicine are part of a national movement to consider patients’ cultural beliefs and values when deciding their medical treatment. The approach is being adopted by dozens of medical institutions and clinics across the country that cater to immigrant, refugee and ethnic-minority populations.

Certified shamans, with their embroidered jackets and official badges, have the same unrestricted access to patients given to clergy members.

Jim Sabin at the Health Care Organizational Ethics blog offers his thoughts on the article. We're very proud of this program, and other multicultural care programs at our other facilities. This work is part of our mission to care for the whole person.

CHW Road to Health Reform

Over July and August this year six CHW hospitals held health reform town hall meetings in their communities. The tone of these town halls stand in stark contrast to the town halls that were covered on the news. In all, more than 750 people of all ages came together to talk about the health system and the changes they hoped to see in a reformed system. Take a look: 

Care for Our Patients, Care for Earth

Our mission to protect the Earth extends inside and outside our hospital walls. Take a look at this video from the National Science Foundation featuring our linen services at St. Joseph's Hospital in Stockton, CA: