Georgetown Professor Linda Blumberg Discusses Commercial Health Insurance "Middlemen"

In a world of unbridled self-interest or where self-interest becomes the basis for reason, where integrity is abandoned, where there exists a striking absence of and/or contempt for moral analysis, virtue and empathy and where cynicism becomes inevitable, power compromises the law and evil no longer needs to be justified. These realities, for example, help explain a projected 14+ million deaths by 2030 via US AID funding cuts, the US quitting the WHO and the Paris accord, cutting Medicaid funding by ~$1 trillion, reducing projected ACA enrollment by nearly 50%, disappearing AHRQ, crippling the CDC and dismantling the EPA. As Prof Neiman argues, “In all the words written in an attempt to understand the present crisis, what’s striking is the scarcity of moral analysis.” “Trump and his ilk could never have come to power without one belief: Moral concepts are for suckers who don’t know they’re being conned.” Professor Susan Neiman bios are at: https://www.susan-neiman.com/ and at: https://en.wikipedia.org/wiki/Susan_Neiman. Info on “Call It Evil” is at: https://wwnorton.com/books/9781324131045.

On July 30 Senate Finance Committee Democrats issued an 86-page Request for Information (RFI) titled, “Health Coverage That Works for Everyone.” As Ranking Democratic Member Ron Wyden explained, much like the Finance Committee’s 2008 white papers that laid the groundwork for the ACA, this RFI constitutes an essential blueprint for necessary and immediate federal healthcare reform. Surprisingly - or not, beyond a limited number of trade publications and policy shops the RFI has to date been ignored. The authors 167-page paper make essentially two arguments: while the Ds diagnosis is correct in that part of the problem is how commercial insurers (termed “Big Insurance”) make money (and how much), nearly half of the RFI’s 71 propose reforms will likely cause payers to move money to unregulated subsidiaries or affiliates instead of saving it or applying the savings to actual care spending; and, by ignoring hospital prices, that substantially are responsible for both health care spending and inflation (once again think: “It’s the Prices, Stupid”), the Senate Finance Ds are ignoring over $300 billion in potential annual savings. E.g., they write, “squeeze insurer margin perfectly and the hospital price base is exactly where it was,” and “you cannot audit the pricing power of the party [hospitals] you have just cast as the injured one.” The report deserves the attention of all serious healthcare policy students. The authors’ work, published as INET working paper, is at: Alvelda-Ferguson-Wyden-RFI-Critique-Brainworks-INET-final.pdf. INET is at: https://www.ineteconomics.org/. Professor Ferguson’s bio is at: https://www.ineteconomics.org/research/experts/tferguson. Dr. Alvelda’s bio is at: https://www.ineteconomics.org/research/experts/pAlvelda and at: https://brainworks.ai/about-us/.

Beginning in the 1970s and 1980s (think, e.g., Hayek, Friedman, Reagan, Stockman and Clinton), US policymakers decided healthcare should be defined like any other commercial or market commodity. It’s not, think: Ken Arrow. Therefore, national policymakers under the mantra of the financialization of everything or privatization included healthcare (think: Medicare Advantage); largely per Robert Bork’s book, “The Anti-Trust Paradox” policymakers freed healthcare of anti trust enforcement and increasingly deregulated healthcare (think: the employer-sponsored insurance (EIS) system). Today, US healthcare is arguably the largest industry in the world’s largest economy, with a ~$7.5 trillion market cap, and is highly concentrated. As Prof McDonough cites, “America’s health care crisis is,” per Phil Longman, “brought to you by monopoly.” Think: UNH that controls approximately 2,700 global subsidiaries and affiliates. We know the results. In his introduction Professor McDonough appropriately cites Maya Angelou’s observation, “if you don’t know where you’ve come from, you don’t know where you are going.” Possibly more optimistic, James Baldwin phrased the idea as, “If you know whence you came, there is really no limit to where you can go." One can hope. Information regarding “America’s Wrong Turn” is at: https://www.press.jhu.edu/books/title/53872/americas-wrong-turn?srsltid=AfmBOoqNV4mGGs9z2P9ym233e-Bsp4EBV3SAAvJKYm2RTAKtcuAk1afm. Prof McDonough’s Harvard Chan School of Public Health website page is at: https://hsph.harvard.edu/profile/john-e-mcdonough/.

With the Congress adjourned for summer recess and the mid-terms now 83 days away, August is a good time to discuss substantive or systematic HC reform. Listeners, and/or anyone paying attention to mid-term campaigns and primaries (think: Dr. Abdul El-Sayed) are well aware healthcare is again on life-support largely due to increasing unaffordability and political acquiescence. In “Beyond Medicare for All,” Mr. Terry essentially argues healthcare can be achieved without dismantling private insurance or expanding single-payer government health delivery by creating a bifurcated or two-tiered delivery and financing model that would be led in part by independent primary care physicians. Information about Ken Terry’s is at: https://kevinmd.com/post-author/ken-terry Information about “Beyond Medicare for All” is at: https://physicianledreform.com/ .

As everyone is well aware, healthcare, particularly acute care (think: hospitals) has become increasingly more unaffordable. For the four-year period ending next year ERISA or employer-sponsored health insurance plans will increase employee premiums by ~25%; this year the average employee family premium is ~$27,000; by the end of this year six million are expected to lose ACA coverage; and, to really on one’s surprise a recent survey found less half of Americans, regardless of income, believe they have the ability to pay for needed medical visits. The answer seems to be legislating hospital price transparency. Earlier this month both the House Energy and Commerce and the Senate Health, Education Labor and Pensions (HELP) committees passed price T bills out of committee. Regarding the Senate effort, HELP Committee Chair, Dr. Bill Cassidy, stated, “I'm very optimistic that it will pass . . . and I'm confident that it will." Information on Turquoise Health is at: https://turquoise.health/patients. Testimony presented during the June 10 House E&C hearing noted during this interview is at: https://democrats-energycommerce.house.gov/committee-activity/hearings/hearing-lowering-health-care-costs-all-americans-examining-policies.