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Health Care Reform Sorting It Out: The Federal Plan vs. The Minnesota Health Plan

Health Care Reform Sorting It Out: The Federal Plan vs. The Minnesota Health Plan. Amy Lange, RN, MS MINNESOTA UNIVERSAL HEALTH CARE COALITION. Where are we in the United States??. Cost Quality Access. Health Care Spending, Percent of GDP.

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Health Care Reform Sorting It Out: The Federal Plan vs. The Minnesota Health Plan

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  1. Health Care Reform Sorting It Out:The Federal Plan vs.The Minnesota Health Plan Amy Lange, RN, MS MINNESOTA UNIVERSAL HEALTH CARE COALITION

  2. Where are we in the United States?? Cost Quality Access

  3. Health Care Spending, Percent of GDP Source: Organization for Economic Co-operation and Development (OECD), 2009

  4. Health Care Spending Per Person, 2006 Source: OECD, 2009

  5. Health Insurance Premiums Source: American Family Physician, 2005.

  6. Maternal Mortality- Industrialized nations Maternal Death per 100,000 birthsDeveloping Countries 450/100,000

  7. Infant Mortality-Industrialized Countries

  8. Access Source: http://www.census.gov/hhes/www/hlthins/hlthins.html • 46.3 million Americans (15.4%) with no health insurance (2008) • 480,000 Minnesotans (9.1%) with no health insurance (2009)

  9. Sources of Insurance Coverage in Minnesota

  10. The Uninsured Sources: American Journal of Public Health, 2009; Archives of Surgery, 2009 • Approx 45,000 deaths/year from uninsurance • 305 Minnesotan deaths in 2008 • Uninsured have a 40 percent higher risk of death than those with private health insurance • Uninsured children who wind up in the hospital are 60% more likely to die than children covered by either private or government insurance plans

  11. The Insured Source: American Journal of Medicine, 2009 • 62% of personal bankruptcies due to medical expenses (2007) • 50% in 2001 • 78% of people with medical bankruptcies had health insurancewhen they got sick

  12. Administrative (In)Efficiency

  13. Insurance Overhead International Journal of Health Services 2005; 35(1): 64-90

  14. Health Care Reform Definitions and Principles

  15. Definitions • Universal health care • Access for all to health care • Doesn’t specify how • Ex: Insurance Mandate • Single-Payer System • Publicly-financed, privately delivered • Medicare-for-all • A type of national health insurance • Socialized Medicine • Publicly-financed, publicly owned • Payer also employs providers (VA)

  16. The Big Questions • Is health care coverage an individual responsibility or a communal responsibility? • Is health care a commodity or a public good? Should wealth determine the quality of care or security of access? • What is the “value added” by insurance companies? • What is the role of government?

  17. Federal Health Care ReformWhat just passed???The Patient Protection and Affordable Care ActMarch 2010

  18. The Federal Reform Bill- the Basics • Expanded Access • Insurance Mandate- everyone required to have insurance- or pay a fine (2014) • Guaranteed issue- insurance companies can’t turn people away for pre-existing conditions (2014) • Young adults on parents’ plan until age 26 (2010)

  19. The Federal Reform Bill- the Basics • Affordability • Community Rating- can’t charge extra based on health history, only age, tobacco • Insurance Exchanges- one for individuals and one for small businesses • Subsidies to purchase for up to 400% FPL (2014) • No annual or lifetime caps on insurance pay-out (2010) • Expansion of Medicaid eligibility to 133% of poverty line, includes childless adults

  20. The Federal Reform Bill- the Basics • Affordability • Funding for community clinics • Temporary subsidized high risk pool (2010) • Small business tax credits-25 or fewer employees (2010) • No co-pays for preventive services (2010) • Closes Medicare “donut hole” ($250/yr subsidy in 2010, phase out “donut hole” by 2020) Requires Rx manufacturers to discount brand name drugs (2011)

  21. The Federal Reform Bill- the Basics • Cost Control • Cuts to Medicare Advantage, private plans (2011) • Phased in excise tax for high cost plans (over $10,200 for individuals, over $27,000 for families) • Establish Payment Advisory Board, Innovation Center, Accountable Care Organizations, would affect Medicare reimbursement only

  22. What’s Wrong With All That? • COMPLEXITY- hundreds of plans, new layers of rules, lots of verification of eligibility, income, compliance • WASTE- increases administrative burden to insurers, families, providers. Leaves in place a fragmented system where 31% of health care spending goes to administrative overhead.

  23. What’s Wrong With All That? • COST- People forced to buy a product they can’t afford to use. Doesn’t control rate hikes, doesn’t guarantee claims will be paid. Imposes a fine if you don’t comply, healthy people may chose this, raises cost to people with insurance. Doesn’t use proven methods of cost containment: bulk purchasing, administrative simplicity, global budgeting.

  24. What’s Wrong With All That? • ACCESS-Leaves people out- 23 million estimated to be uninsured in 2019 • INEQUITY- Leaves in place a system where the quality and security of your coverage is largely determined by your wealth

  25. Affordability?? • Family of 3 with income of $56,000 /year (305% of Federal Poverty Line) • Subsidy to reduce premium to 9.5% of income=$5,320 • Subsidy to reduce out-of pocket for co-pays and deductibles to max of $7973/ family • Total possible cost/year= $13,293= $24% of income (before taxes) • Subsidies taper and stop at 400% FPL- $73,700 for family of 3

  26. Lessons from Massachusetts • Individual mandate, penalty for uninsured, insurance exchange, affordability subsidies. Lowest rate of uninsured in country but: • Exploding costs • Decreasing subsidies, changing eligibility • People “gaming system”, only purchasing when ill • Insured skipping care due to cost (1 in 5 problems with medical debt) • Not all providers accept subsidized plan

  27. Lessons from New York • Instituted community rating (rate not based on health history)and guaranteed issue (can’t be denied based on pre-existing condition) in 1993 • Exploding costs • Policies priced out of reach- leads to “adverse selection death spiral” healthy drop coverage, only sick in pool, rates rise, cycle continues.

  28. The Solution is Single Payer The Minnesota Health Plan

  29. Principles of the Minnesota Health Plan • Ensure all Minnesotans receive high quality health care, regardless of their income • Not restrict, delay, or deny care or reduce the quality of care to hold down costs, but instead reduce costs through prevention, efficiency, and reduction of bureaucracy • Cover all necessary care, including all coverage currently required by law, complete mental health services, chemical dependency treatment, prescription drugs, medical equipment and supplies, dental care, long-term care, and home care services

  30. Allow patients to choose their own providers • Be funded through premiums and other payments based on the person's ability to pay, so as not to deny full access to any Minnesotan • Focus on preventive care and early intervention to improve the health of all Minnesotans and reduce costs from untreated illnesses and diseases • Ensure an adequate number of qualified health care professionals and facilities to guarantee availability of, and timely access to quality care throughout the state; • Continue Minnesota's leadership in medical education, training, research • Provide adequate and timely payments to providers

  31. A Single Payer, Single Plan • Equity- everyone has the same comprehensive plan • Continuous coverage cradle to grave, guaranteed, no change in coverage with job change, or loss • Premiums based on ability to pay, not on age, gender or medical history, not regressive funding like insurance • Eliminateswasteful practices of underwriting, marketing, redundant billing, negotiation of networks and plans, insurance lobbying, exorbitant CEO salaries • Choice of doctor and other providers- all licensed providers in state-wide network.

  32. Single-Payer Saves Money • Bulk Purchasing of supplies • Reducing excess capacity- technology and hospital beds • Negotiated reimbursement rates • Global hospital budgeting • Elimination of wasteful multi-payer paperwork, claims, co-pay and deductible processing • Primary care reduces costly ER visits • Is compatible with other payment reform options

  33. Cost of Various Colorado Health Care Reform ProposalsIn 2006, the Colorado Blue Ribbon Commission for Health Care Reform hired the Lewin Group, a national health economics analysis firm, to evaluate the costs and effectiveness of four proposalsmoving towards universal health care. The results were clear:

  34. Senate File 118/House File 135 • 74 Legislators have signed as co-authors- over 1/3 of the legislature • First introduced in 2007 • Has passed 4 committees since being reintroduced in 2009 • All of the DFL Gubernatorial candidates would sign the Minnesota Health Plan. Dayton and Kelliher actively support it

  35. Legislative Co-AuthorsSen. John Marty, Rep. David Bly • SENATE: Anderson (66), Bakk (6), Berglin (61), J. Carlson (38), Chaudhary(50), Cohen (64), Dahle (25), Dibble (60), Doll (40), Erickson Ropes (31), Foley (47), Higgins (58), Kubly (20), Lourey (8), Moua (67), S. Murphy (28), Olseen (17), M. Olson (4), Pappas (65), Prettner Solon (7), Rummel (53), Saltzman (56), Scheid (46), Skoe (2), Skogen (10), Tomassoni (5), Torres Ray (62), Wiger (55) • HOUSE: Anzelc (3A), Benson (43B), L .Carlson (45B), B. Champion (58B), K. Clark (61A), Davnie (62A), Doty (12B), Eken (2A), Falk (20A), Faust (8B), Fritz (26B), Greiling (54A), R. Hansen (39A), Hausman (66B), Hayden (61B), Hilstrom (46B), Hilty (8A), Hornstein (60B), S. Johnson (67B), Kahn (59B), Kelliher (60A), Laine (50A), Lesch (66A), Liebling (30A), Mariani (65B), Masin (38A), Mullery (58A), E. Murphy (64A), M. Murphy (6B), Newton (49B), Otremba (11B), Paymar (64B), Persell (4A), Reinert (7B), Rukavina (5A), Sailer ((2B), Scalze (54B), Slawik (55B), Slocum (63B), Thao (65A), Thissen (63A)Tillberry (51B), Wagenius (62B), Ward (12A)

  36. Endorsers of the Minnesota Health Plan • AFSCME Council 65 • American College of Nurse Midwives- MN • Duluth City Council • Great Northern States Health Care Initiative • Greater Minnesota Health Care Coalition • Headwaters Foundation for Justice • International Brotherhood of Electrical Workers 110 • Itasca Progressive Caucus • Lake Country Progressives • Land Stewardship Project • League of Women Voters- Minnesota • Mature Voices Minnesota • Metropolitan Independent Business Alliance • Minneapolis City Council • Minnesota Alliance of Peacemakers • Minnesota Association of Professional Employees • Minnesota Citizens Organized Acting Together • Minnesota DFL Progressive Caucus • Minnesota Farmer’s Union • Minnesota Green Party • Minnesota Independent Field Staff and Clerical Association • Minnesota Nurses Association • Minnesota Public Interest Research Group (MPIRG) • Minnesota School Employees Association • Minnesota Universal Health Care Coalition • National Association of Social Workers- Minnesota • National Lawyers Guild • National Organization for Women- Minnesota • Network of Spiritual Progressives • Older Women’s League • Physicians for a National Health Program- Minnesota • Retired Teachers Council #59 • Stonewall DFL • TakeAction Minnesota • United Food & Commercial Workers #789 • Universal Health Care Action Network • Veterans for Peace Chapter 27 • Women’s Cancer Action

  37. Minnesota Universal Health Care Coalitionwww.muhcc.org2469 University Ave W, Suite W150St. Paul MN 55114651-641-4073

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