A LONG while back I had a
diary that spent a full day on the rec'd list that was about a talk I heard by Uwe Reinhardt about
Health Savings Accounts.
I remember being totally inspired by this talk. I remember Uwe basically pissing all over the idea of HSA's (he kept saying "Is that in the Bible?"). I remember he backed it all up with numbers. Overall there was the 80/20 rule that the 20% of sickest people use 80% of all healthcare. With insurance, this works. With HSA's, the sickest 20% is screwed. But I had a fuzzy memory of most of the talk.
Since healthcare is this year's social security and Bush is supposedly going to blow sunshine up the ass of the American public about these HSA's, I thought I should resurrect the most relevant parts of that old diary and then see what else I could find on the subject.
If you are not among the 59% of Dems who say they aren't even going to bother watching Chimpy McFlightsuit embarrass himself tonight, take a look below and feel free to recommend so we can all be prepared for the fight.
From my old diary:
Would you believe it if I told you that several thousand healthcare professionals from all over the U.S. gave a standing ovation to a liberal proposal to reform American healthcare? The thing is, I identified the talk as liberal because when ideas get politicized, a lot of "common sense" falls on the side of "liberal." But the speaker was a PhD in economics who used research to support the conclusions he spoke about - he was trying to be accurate, not liberal. And the room was full of doctors, nurses, administrators, and IT folks who live in the real world of American healthcare every day and they were listening to the facts they already know well - they weren't thinking about the truth as "liberal" either. If your name is not George Bush, and you are not trying to skew the system to screw the poor, good old fashioned common sense and facts are not inherently political.
-snip-
Uwe's Talk about HSA's
Then Uwe addressed the idea of the Health Savings account. The idea is this: A normal family has low healthcare costs most years, with a few years where costs spike due to cancer, car accidents, etc. There are 2 types of HSAs:
- The employer contributes an amount per year, there is a high deductible (with everything above it paid by insurance), and the patient picks up the tab on the rest. In the good years, the money accumulates in the savings account, and in the bad years, the savings account money pays up to the deductible (with the patient hopefully not paying too much), and insurance picks up the tab on everything else.
- The patient contributes money up to a high deductible and insurance pays the rest.
Here are the issues with this plan:
First of all, it CAN be used to a good purpose. If the employer is putting enough $ in the account and paying the premiums, and the patient is not chronically ill, it can really help the patient out.
But, consider the 80/20 rule: 20% of patients (the chronically ill) use 80% of all healthcare services. These patients would have to pay up to their deductible every single year, which means it would be a huge financial hit for them, even if their employer was contributing. This system would put the worst burden on our sickest patients.
Second, consider a mother of 3 who makes $25k per year at Wal-Mart in Dallas, TX. Wal-Mart doesn't give her healthcare. This was the part of Uwe's talk that made the biggest impression on everyone.
He looked up the plans available to this woman online. There were 2 - one with a ~$120/mo premium and a $10,000 deductible and $5 generic$10 brand name drug copays, and one with a $160/mo premium and a $5000 deductible.
I unfortunately do not have the numbers in front of me, but he extrapolated out health care costs over the next 10 years using the 2 1/2 % rule (healthcare costs grow at a rate 2 1/2% higher than that of the GDP) and the calculations came out that this woman would have to spend something like 55% of her income on healthcare alone.
He said that the people who contribute the most to our successful society are mothers and high school teachers. The CEO of GE can put a bunch of engineers in a room and kick their butts so they work, but it was their mothers who really got them to that point where they were educated and capable of doing their jobs. He said this woman deserves a medal - or 3, one for each kid.
One more point he made to the audience - basically, if the system screws the patient and the patient doesn't have the cash to cough up, ultimately the costs will all wind up as bad debt for the hospitals. The entire room was filled with representatives of the largest and most prestigious healthcare organizations in the country, and they are familiar with the idea of bad debt. They want to provide care for their patients, and they don't want to create a system in which they get stuck with costs as bad debt. I can't remember more specifically what was said because I work in clinicals and have very little familiarity with billing, but it reminded me of the bankruptcy bill. The credit card companies can write the policies to screw the little guy by not allowing people to declare bankruptcy, but ultimately if the money isn't there, the money isn't there - it will just wind up as bad debt for the credit card companies anyway, meanspirited morally bankrupt bill or no.
He ended on this note: He said he is an economist, and it is not an economists job to tell you how to make moral decisions, but it is his job to point out when a moral dilemma exists. The case above of the woman spending 55% of her income to get healthcare is a moral dilemma.
When Uwe delivered this talk, I was inspired. The entire room exploded into a standing ovation. He was absolutely right. Completely right. But - healthcare savings accounts? I hadn't heard of them. And if I had, in passing or something, they were no rightwing bogey man for me. Yet.
Ok, so off to find information to prep for tonight. Turns out, HSA's haven't really caught the attention of other people either. Way to go Uwe for being ahead of the game. Here's what I did find... stay with it all the way down to the bottom because the last article I found really makes an excellent point.
Tipsheet
A "tipsheet" I found about the SOTU quotes two people. I would bet you this exactly previews Bush's points.
The first is a Bush advisor (Dr. Arthur Garson Jr.) who makes the point that the system is broken.
"Tax breaks will clearly help reduce the uninsured," Garson says. "The key is how much is the break. It's no good if anyone has to come up with more than 5 percent of their income, or if they buy `insurance' that when you read the fine print actually barely covers a doctor visit and no tests. More than 7 in 10 people who are uninsured work -- and continue to work -- and so the ability to be covered between jobs is vital. Automobile accidents don't just occur when people are working."
So, here are the bullets:
- Tax "reform" helped poor people
- Lots of people who work don't have health insurance
- Even people who do get insured on their jobs need insurance between jobs
Hard to disagree with all of that, even though the bit about the tax reform makes me angry because it's what Al Franken would call "a weasel" (technically the poor got some tax cuts... but not as much as the billionaires)
The second blurb on the "tipsheet" is by Elizabeth Olmsted Teisberg, a business professor who co-authored a book called Redefining Health Care. She said Bush is going to advocate HSAs, and they don't work. The current system doesn't work either, and she thinks we need universal healthcare. The interesting thing is she said we need universal healthcare not just for ethical reasons but for economic reasons as well. I bet you her book is a great read... maybe I'll check it out, now that healthcare is the topic du jour.
Center for American Progress
Next, I checked Center for American Progress. After the SOTU I am sure they will have great stuff about HSA's, but so far I found nothing on their site.
"Fair and Balanced" Description of HSA's
I tried a Yahoo! search and found an old USA Today article that gives a good summary of what an HSA is, how you use it, and when it might benefit (or not benefit) you. It seemed unbiased, so I won't go into it here because I think Uwe covered it pretty well but you might want to check it out.
Other Articles
Amazing what sort of fluff our media gets away with. A search for news about healthcare in the SOTU returned a big bunch of articles about "Bush is real busy, getting ready," "Bush wants to get an approval ratings boost from SOTU," "Bush is almost ready!" and other fairly useless articles.
Then, *bingo* I found it! Not what I was looking for... exactly... but I'll take it.
But one electronic-health entrepreneur will watch the speech with special interest: the President's 36-year-old first cousin, Jonathan S. Bush. That's because he runs athenahealth Inc., a technology outsourcing outfit that will be a huge winner if efforts to improve health-care record keeping through technology take off.
source
Wait a second, so you mean Bush's cousin... actually, this isn't really news, is it? Just business as usual. I swear, if the Clinton administration worked the way the Bushies do, Tommy Lee Jones would've been our attorney general because he was Al Gore's college room mate and (I don't know the man, but I'm guessing) "he has a good heart."
One Last Decent Article I Found
I found one more good article. Other than that... crickets chirping. Nothing. Nada. Maybe I'm not a very good internet-looker-upper. Seriously, though... there's really not much out there and it is an important topic. Al Franken's had Uwe Reinhardt on his show before so I would keep an eye out to see if he'll have him back to talk about HSA's.
So here's my last good article that I found. I think it makes one of the most important points of all.
State of the Union health care proposals must include provisions for preventive care, U-M experts say
Any cash-based changes must include provisions for preventive care, they say
University of Michigan researchers who have studied the impact of out-of-pocket health costs on Americans' behavior are available to comment on new 'consumer-driven health care' proposals that President George W. Bush is expected to unveil in his State of the Union address on Tuesday evening.
While the details of those plans are not known, they are expected to involve more emphasis on individual cash accounts and cash expenditures for health care, in exchange for tax breaks or other incentives.
If so, the researchers say, any plan to increase the consumer's role in health spending must also include a way to ensure that consumers get essential, proven preventive care for little or no money of their own.
These include medications and tests that have been proven to save money in the long run, by preventing the progression of problems or spotting them early. They include screening high-risk individuals for cancer, cholesterol-lowering drugs for people who have survived a heart attack, vaccines for children, and certain medicines and tests for people with diabetes mellitus.
Research at U-M and elsewhere has shown that the more money people have to pay out of their own pockets to get such care, the less likely they are to actually take the medicines or have the tests done. And that increases the risk of more expensive -- and preventable -- problems down the road.
"Involving consumers in making their own health care spending decisions is important and will likely save money at least in the short term," says A. Mark Fendrick, M.D., co-director of the U-M's Center for Value Based Insurance Design and a professor in the U-M Medical School and U-M School of Public Health. "But most of the discussion regarding consumer-directed health plans fails to address the fact that increasing out-of-pocket expenditures will lead to decreased utilization of essential health care services. We need to create a system that will remove financial barriers for those clinical services where there is clear evidence of value."
In brief this is saying: Why the hell would you go in for a mammogram that costs you a $100 to $150 out of your account? Save that money for when I'm really sick, you think. Well guess what? Breast cancer is largely preventable if you find it EARLY!!! So if you don't go get that mammogram, you might make yourself "really sick."
Paying for preventative tests and procedures might look like a financial game if you are writing the checks yourself - but this is really a life or death game. It shouldn't have to do with money. And as Uwe said, when the patient has an incentive to avoid going in for preventative care and they wind up with a REALLY BIG problem - who pays? The patient? If that patient had enough money to pay they would probably buy good enough insurance to cover the preventative tests in the first place. The hospitals will be stuck writing off the costs when these patients turn up in the ER and they can't pay.
End result: hospitals lose, patients lose, insurance companies and employers like Wal-Mart win. Just repeat that in your head while you watch (if you watch) the SOTU tonight.