Are insurers to blame for rising costs?
The San Francisco Chronicle’s Carolyn Lochhead and Victoria Colliver use the recent furor over insurer Anthem’s rate hikes to explore just how much of the blame for rising health care costs should be shouldered by insurers. The reporters find that, in the end, insurers are just another one of the cartels (others include device makers and providers) and operate inside the opaque world of medical pricing and snag hefty cuts for themselves. Lochead and Colliver put it thus:
While the Anthem case has raised a political storm, the underlying surge in costs gets far less scrutiny. But each sector of the health industry points fingers at the other for driving up prices, and all are raking in money.
Insurers blame hospitals and doctors, doctors blame insurers, and hospitals blame doctors and medical devicemakers in what academics call an inscrutable medical-industrial complex that rivals anything the defense industry ever invented. All these groups are combining into what many experts describe as cartels.
The reporters write that, despite their best efforts, they weren’t able to get many folks on the record. When they did find someone who was willing to talk, it was often a source we’ve seen before in other cost stories. It’s a tough theme to get quotes on, as nobody wants to burn bridges with their professional suppliers and everybody’s got some sort of skin in the game. They did, however, manage to find a local source who offered an original and illuminating anecdote:
Christina Bernstein, a medical-device engineer and independent sales representative based in San Francisco, sells disposable surgical tools made mostly out of plastic that she estimates are manufactured for about $40 each. These are marked up and sold to hospitals for as much as $350, she said, for a single use in a surgery on a patient.
“But if you were to get a detailed bill of what the hospital was charging the insurance company for the insured patient, those things get marked up to something like $1,200,” Bernstein said. “It’s ridiculous. There’s no open competition.”
(Hat tip to AHCJ Immediate Past President Trudy Lieberman, who wrote a column on CJR.org praising the Chronicle’s story.)
Reporters chronicle the death of a sugary drink tax
With a classic tale of powerful established interests, millions and millions of dollars and savvy lobbying, Chicago Tribune reporters Tom Hamburger and Kim Geiger draw our attention to the news vacuum that has formed where debate over a sugary drink tax used to be. From its optimistic beginnings to its eventual slow strangulation, Hamburger and Geiger track the rise and fall of the push to tax sugary drinks in order to discourage poor dietary choices and help fund health care reform.
The reporters do a wonderful job of chronicling every lobbying pressure point pushed by the industry, from faux grassroots to industry alliances to muli-million-dollar advertising campaigns. Here’s a small sample of their overview:
The White House has dismissed the idea, however, even after President Barack Obama had expressed interest last summer. A key congressional committee, though initially seeming receptive, ended up refusing to consider it. Several minority advocacy groups, including some committed to fighting obesity, lined up against the tax after years of receiving financial support from the industry.
…..
Meanwhile, beverage lobbyists attacked several nutrition scientists, accusing them of bias and distorting available evidence. The beverage industry also financed research that reached conclusions favorable to its position.
(Hat tip to Audrea Huff of the Orlando Sentinel’s Fitness Center blog)
Academics: Media added to reform confusion
Filed under: Health care reform, Health data, Hot Health Headline, Member news
Health News Florida’s Carol Gentry talked to journalism professors at three major Florida universities about the effect of media coverage on public perception of health care reform. The trio suggested that the media muddied the issue by focusing coverage on the political horse-race aspects while neglecting to invest the time necessary to fully explain the proposed legislation’s finer details.
In a column for AHCJ, Trudy Lieberman, the organization’s immediate past president has discussed some of the same shortcomings of health reform coverage. The academics say this is nothing new – many of the same issues surfaced during Clinton’s health reform push in the early ’90s, but say today’s fragmented media environment and 24-hour news cycle have certainly exacerbated matters.
[Kim Walsh-Childers, University of Florida journalism professor] said many Americans get their information from talk radio or blogs, “which are far less likely to provide balanced, complete information than are traditional news outlets, especially newspapers.”
“Even those who read newspapers may be getting far more information about the political strategies (of) the various stakeholders … than they are about what those proposals actually would mean for the average family,” Walsh-Childers continued.
Walsh-Childers praised NPR and The New York Times for their more thoughtful reform coverage, and said layoffs of experienced health reporters had likely weakened coverage at many outlets.
Gentry also cited surveys conducted by the Kaiser Family Foundation which found that peoples’ opinions of reform changed when they were better informed of the bills’ actual components.
Surveyors found that while a majority said they were opposed to the legislation, support grew markedly when survey participants found out the major parts of the plan.
Three-fourths became more favorable when they heard about tax credits for small businesses and two-thirds liked what they heard about health exchanges, constraints on health insurers and plugging the Medicare prescription-drug “doughnut hole.”
Related
More columns by Lieberman about coverage of health reform:
- Putting a human face on McCain, Obama health plans
- Look for opportunities to localize the debate on national health reform
- If candidates won’t focus on aging issues, journalists better
- Candidates’ health reform language needs closer scrutiny, definition
- Journalists must do better to inform, educate public
Health reform and the Supreme Court
Filed under: Government, Health care reform, Health data
Sarasota Health News‘ David Gulliver and Health News Florida’s Mary Jo Melone considered exactly how last Thursday’s Supreme Court ruling on campaign contributions by corporations would impact the health care lobby and the health reform debate. Their most interesting angle? That health care companies have already spent such gigantic sums of money on lobbying (more than $2.2 billion in 2008 and 2009) that the ruling won’t have the same impact on health as it will on other industries. In other words, the medical industry has already had the volume on the lobbying amp cranked to 10 for some time now, and it’s just not possible to ratchet it up any higher.
Gulliver and Melone on exactly what has changed in theory:
Until now, companies could not spend their own money directly on political advertising. They had to create political action committees, or a shadowy type of nonprofit known as a 527 organization. Then those groups could raise money from donors to pay for advertisements. For PACs, those donations are limited under federal law to $5000 per person per year.
In practice, the impact is less clear. Even under the previous system, those with money found ways to use it with impunity. It’ll be a more straightforward process now but, especially in health care, may not lead to huge changes in the money being spent. According to one school of thought, the biggest change will be in the use of explicit anti-candidate advertising threats as a metaphorical club during negotiations.
NOTE: It’s important to remember that, in a companion decision, the court upheld the transparency requirements that accompany these political donations. If you’re interested in tracking the changes in donations post-decision, head over to OpenSecrets.org, where they have a post explaining exactly how to use their tools to do so.
As for immediate impact, the reporters quote several experts who seem to think that unrestrained spending won’t transform the health care reform debate, partly because it’s already been so thoroughly transformed by other factors.
(Brad Ashwell of Florida Public Interest Research Group) said the legislative health-reform package pending in Congress is already “pretty moderate,” and it’s not likely to get more consumer-friendly now that business interests “can go straight to their treasuries.”
Even before the Supreme Court ruling, chances of helping Florida’s 3.8 million uninsured were looking increasingly sketchy, with a special-election loss that cost Democrats a crucial seat in the U.S. Senate this week. The only quick route to passage was for the House to accept the version of the legislative package that barely passed in the Senate on Christmas Eve, and House Speaker Nancy Pelosi announced Thursday she doesn’t have the votes to pull it off.
How health reform lost popular support
Filed under: Government, Health care reform, Health policy
Kaiser Health News staff writers, including Jordan Rau, Mary Agnes Carey, Julie Appleby and Phil Galewitz, teamed up to figure out why Americans are so disenchanted with health care reform. After talking to an analyst who admitted that politicians “can do everything right and still fail in health reform,” the reporters set out to figure out what, if anything, went wrong.
The reporters divided the administration’s missteps (and, to a lesser degree, those of lawmakers) into four categories: helping individuals understand how reform tangibly benefited them, threatening Medicare, proposing a number of confusing tax increases, and the lengthy and frustrated deal-making process that preceded the reform bills now under consideration.
Myth surrounds reform’s ‘Safeway Amendment’
Filed under: Government, Health care reform, Health policy
Throughout the health care reform process, politicians have held up Safeway’s health incentive program as a model for future government health plans. The supermarket chain’s program requires employees who fail basic health screenings for blood pressure, weight, and cholesterol to pay higher health insurance premiums. 
Safeway maintains that this policy encourages its employees to make healthy lifestyle changes to in turn lower their health care costs. The Washington Post’s David Hilzenrath looked into the grocer’s impact on proposed health reform plans. Hilzenrath reports on how misconceptions about Safeway’s wellness program could impact public health policy in the U.S. Senate’s proposed Safeway Amendment.
Under a regulation advanced during George W. Bush’s administration, incentives conditioned on meeting wellness targets are limited to 20 percent of the premium – including employer and employee contributions to the premium. The Safeway Amendment would allow employers to increase the stakes to 30 percent, and it would give federal officials license to raise the limit to 50 percent. It would also allow insurers to use the same approach – initially in 10 states and potentially in others.
Employers and insurers would be required to make exceptions for people with extenuating medical circumstances.
Supporters of the amendment maintain that it will encourage private-sector employees to monitor and improve their health. Dissenting organizations, including the American Heart Association and the American Cancer Society, suggest that the legislation will unhinge a central tenet of health reform: That an individual’s health status will no longer impact premiums.
Safeway credits its internal health plan for keeping the company’s health care costs nearly steady between 2005 and 2009. An external survey of 1,700 employers revealed that companies’ health care costs increased by 30 percent in the same time period, on average.
Hilzenrath reports that “a review of Safeway documents and interviews with company officials show that the company did not keep health-care costs flat for four years. Those costs did drop in 2006 – by 12.5 percent. That was when the company overhauled its benefits, according to Safeway Senior Vice President Ken Shachmut.”
Reform bills would benefit Indian Health Service
Filed under: Government, Health care reform, Health policy
Mark Trahant, writing for InvestigateWest, points out that, because it’s in both the House and Senate versions of the bill and thus safe in conference committee, the reauthorization and extension of the Indian Health Care Improvement Act will pass as long as the larger reform package does.
The Parker Indian Health Services Hospital in Parker, Ariz. Photo by churl via Flickr.Originally enacted in 1976, the IHCIA has, in various iterations, been the primary vehicle for the delivery of health care to the country’s American Indians and Alaska Natives.
The latest version of the bill would adjust the Indian Health Service budget to account for medical inflation and population growth, increase efforts to recruit and retain health care professionals, introduce coverage for long-term care, improve youth suicide prevention programs and encourage innovation that will help provide easier access to health facilities.
Medical tourism expected to continue growth
Filed under: Health care reform, Hot Health Headline
The San Francisco Chronicle’s Carolyn Lochhead writes that the draw of medical tourism lies with both transparency and affordability and implies that its success shows the need for an overhaul of the U.S. medical system.
She also notes that the reform efforts don’t seem likely to change those two central systematic problems, and thus medical tourism is likely to be here to stay, at least in the foreseeable future. The piece also explores the consumer side of medical tourism, profiling an Oklahoma surgeon who competes on price and transparency.
The article also cites an executive who advises that the economics of going overseas for treatment start making sense when the American price tag for a procedure reaches about $15,000.
Resources
- Controversy follows medical tourism’s top couple
- Story examines risks, rewards for medical tourists
- Self-insured groups may encourage medical tourism
- Tip Sheet - Medical tourism: Trend or aberration
- Article - Health Journalism 2008: Medical tourism - trend or aberration?
- Role of the Internet in medical tourism
- Tip Sheet - Medical Tourism Takes Flight
MPR builds health-reform impact calculator
Filed under: Health care reform, Hot Health Headline
As part of her series on the effects of health care reform on small businesses, Minnesota Public Radio’s Elizabeth Stawicki and Bob Collins created an online calculator/quiz for employers wondering if reforms will apply to them.
It’s a simple way to use the Web to personalize health care reform and test the effects of reform.
Tip: If you’re just looking to put the tool through its paces, try the “will you be assessed under pay or play” option. It’s the most fully realized of the four.
Health care reform for the young and healthy
Filed under: Health care reform, Hot Health Headline
As part of the ProPublica Eye on Health Care Reform blog’s ongoing “What Health Care Reform Means For…” series, reporters Sabrina Shankman and Olga Pierce considered how the Senate and House reform bills would effect young, healthy, independent Americans. Here are a few highlights from their piece:
- They’ll no longer have the option of going without insurance (unless they’re willing to incur a penalty).
- They’ll get to ride their parents coverage until age 26 or 27, depending on which version you’re looking at. At present, it doesn’t last much past 19.
- The poorest may be eligible for Medicaid, even if they don’t have kids.
- In the Senate version, they’d also have the option of bare-bones coverage until age 30.
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Health Journalism 2010, AHCJ's annual conference, features a world-class program with story ideas, sources, stronger reporting skills, chances to meet newsmakers and network with other journalists.
- Health and education: Covering these intersecting beats
- Reporting on the business of health care
- Health reporting resources for journalists on state and local government beats
- Shortened Lives: How location, lifestyle affect health
- Covering a complex story for the long haul
- Aging in the 21st Century: Presentations and tip sheets
- AHCJ calls for better information from Joint Commission Web site
