Sunday 25 June 2017

Sorry You Asked?

No, I haven't been for a visit & not planning one anytime soon.
I've somehow acquired quite the motley united nations of foreign friends.  Some wake up to spiders that look like this on their bedroom ceiling, others consider lutfisk an edible substance.  But they have one characteristic in common (other than great taste in friends): They arebaffled by the U.S. healthcare system.  You see, all civilised countries have some form of universal healthcare.  Access to affordable healthcare is something my overseas friends have been able to take for granted all their lives.  But now that we've reached the age when the 'rents are starting to show some wear and tear, and even our own knees and backs are needing servicing, we end up discussing healthcare a lot more than we used to.  Yes, I'm afraid the conversations have shifted from "Should I get that cute dress?" to "Should I get that hip replacement?"  It seems our main topic of discussion these days is not whether to order dessert (we always do) but what to do about our increasingly dysfunctional parents.  Somehow, despite watching our parents take care of our grandparents, we never expected it to be this frustrating.  But my foreign friends don't have to worry about money.  There may still be screaming fights and slamming doors, irrationality and guilt-tripping and hair-pulling exasperation, but at least there are resources.  When the conversation gets around to me, "But can't you just…." is always followed by my shaking my head and lamenting, "Can't afford it."  But doesn't the U.S. have universal healthcare for old people, they ask, and I have to explain the limits of Medicare.

They've also read in the news that Obamacare gave millions more people access to healthcare and they don't understand why Trump is trying to repeal it.  So, for my foreign friends, here is a brief, simplistic primer on the egregious travesty that passes for healthcare in the United States.

If you don't have universal healthcare, how do people get the care they need?

Via an ugly patchwork of methods, with many holes and loose threads.  Most people receive health insurance via their jobs (about 72%).  Their employer pays part of their monthly premium and they pay the rest out of pre-tax income.  People who don't get health insurance from work can purchase it privately.  The very poor are sometimes eligible for Medicaid, which is a government insurance program a bit like universal healthcare just for people in poverty (75 million as of April 2017).  But providers are not required to take it and states can set strict limits on who qualifies.  Everyone over 65 is eligible for Medicare, another government program, which covers about 17% of the population.  But, again, providers are not required to accept it and its coverage is minimal.  To avoid large out-of-pocket costs, Medicare recipients who can afford to do so top up their coverage with additional insurance.  But these supplemental policies are expensive and half of all Medicare recipients earn less than $24K/year.  Special categories of people can sometimes get government-subsidized coverage, such as veterans and the disabled.

So, everyone is covered, one way or another?

Not even close.  People who are not covered by their employer or a government program and who cannot afford to purchase private insurance simply go without (that's about 10.5% of the population currently).  Some may be able to pay out of pocket for very minor illnesses: an acquaintance who cannot afford insurance but who makes too much for Medicaid just paid $50 to a low-income clinic and $300 for a prescription for a simple case of pink eye.  She only broke down and searched for a clinic in her city when she could no longer work her waitressing job due to the pain and itching.  In other words, she spent money she couldn't afford only when she was going to lose more money by missing work.  That's typical.  And how many people did she infect before she gave in and paid for treatment?

Emergency rooms are required by law to see patients regardless of ability to pay so some people without insurance use them for non-emergency care or wait until a problem festers into an emergency.  Since these patients cannot afford to pay and have no insurance to pay for them, the hospitals pass the cost of their care along to everyone else.

Wait, if people who are uninsured just do without care, then why do I hear horror stories of Americans losing their houses due to medical debt?

Ah, well, the ER is required by law to stabilise people.  Someone who arrives unconscious from a car wreck could rack up hundreds of thousands of dollars in medical bills before being released from the hospital.  The hospital would then sick collection agencies on them, and sue them, resulting in their homes and other assets being seized.  So, a sudden illness or injury is one way people lose everything to medical bills.  If they have nothing a creditor can seize, the debt follows them and prevents them ever acquiring any assets—you can't buy a house if it will be taken in fulfilment of a judgment against you for outstanding medical debt.  In fact, you can't even save for a down payment on a house because any money in your bank account is vulnerable to seizure.  Shortly after Obamacare went into effect, a struggling young comedy writer in NYC who was unable to afford a policy suffered a serious leg injury and received a $405K bill for her treatment.  She raised $75K towards it via an online fundraising campaign.  Crowdfunding medical bills is becoming a thing.  It's counterproductive, as are stunts like John Oliver paying off $15M in people's medical debt because it legitimises the debt and feeds the dodgy collection agencies.  The correct response is not to pay a penny of it and protest it as illegitimate.

But the appalling fact is that most crippling medical debt is accumulated by people who have insurance.  You see, insurance doesn't cover 100% of healthcare costs.  There is usually a deductible, co-pay, and co-insurance for most services.  If you have treatment that costs $100,000 and your insurance pays 60%, that still leaves you with a $40,000 bill.  There is also the tiresome issue of in- vs. out-of-network coverage.  Many outrageous medical bills result from patients inadvertently receiving care from a mix of in- and out-of-network providers.  A typical example is someone having surgery at an in-network hospital by an in-network surgeon and then getting a bill from the out-of-network anaesthesiologist.  It is difficult for patients to ensure that every care provider in a hospital is in network, even if they inquire beforehand.  I know of a pregnant woman who checked carefully that everyone associated with her delivery was in network.  But her baby was born prematurely and it turned out that the NICU in the hospital was contracted to an out-of-network company.  She received a $750K bill that was not covered by her insurance.  This is typical in the U.S., and it's not accidental.  The official line from providers is that you are responsible for all charges and they bill your insurance as a courtesy.  They claim that they cannot be experts on what every policy might or might not cover, which is technically true, but it's more sinister than that.  Providers are paid on a per-procedure basis, so they have an incentive to deliver as much care as possible, from as many specialists as possible.  Insurance companies negotiate how much they will pay for each covered procedure and providers agree to accept it.  But an out-of-network provider can charge whatever they want.  This gives them an incentive to come and "consult" for 5 minutes on your case so they can send a nice juicy bill for far more than they could get reimbursed for by insurance.  The differences are staggering:  It's not unusual for a doctor to charge over $5K to an uninsured person for a test that insurance wouldn't pay them more than $100 for.  This piecemeal billing also incentivizes doctors to see as many patients as possible, spending little time with each one, but that's another issue.

Wasn't Obamacare supposed to fix all this?

No. It was designed to solve one problem only: Cover the uninsured.  Before Obamacare, around 18% of Americans lacked health insurance because they weren't covered by an employer, they couldn't purchase it privately, and they weren't eligible for programs like Medicare or Medicaid.

Obamacare did attempt to address an additional problem: People who were underinsured.  That is, they technically had health insurance but the coverage was so limited that it was virtually useless when they needed it.  Estimates vary, but this number was at least as high as the number of uninsured and much higher in some states; in Texas, for example, the number of underinsured people before Obamacare was over 38%.

Obamacare attempted to fix these coverage gaps by requiring everyone to buy insurance and mandating minimum coverage.  But if you require insurance companies to provide minimum coverage they are going to raise premiums, as well as deductibles and co-pays and co-insurance, so how the heck can you then require people who already can't afford insurance to purchase it?  The Obamacare solution was a system of income-based subsidies that paid part of the premium costs.  In theory, this would make insurance affordable for most people who lacked it, and expanding Medicaid would cover many of the rest.

Reality was less rosy.  The Supreme Court ruled that states could not be required to expand Medicaid, leaving insurance still out of reach for most of the working poor, and people who made too much to be eligible for subsidies (for 2017 eligibility was capped at an income of only $47,520) could not afford the premiums.  And then there were the out-of-pocket costs.  Obamacare ended coverage limits and it capped annual out-of-pocket expenses.  But with policy deductibles of $7K, many people found themselves paying high monthly premiums for insurance they could not afford to use.

There were a few other teething pains for the new law.  People who had cheap but barebones insurance were angry that their premiums rose under the new minimum coverage policies.  Some found that their local and/or preferred providers were not in their new policy networks.  (Early in the policy-making process, Obama glibly assured people that they could keep their doctors.  It was a mistake that came back to haunt him, although rising premiums and changing networks were a feature of the U.S. healthcare system before Obamacare.  If you changed jobs, there was never a guarantee that your new employer's policy would cover the family doctor you'd been seeing for 20 years or the only specialist within 200 miles that treated your kid's condition.)  The idea of being forced to purchase insurance, a provision demanded by insurance companies to pool risk in exchange for covering people with pre-existing conditions and providing minimum coverage, grated with many Americans as a matter of principle.  This is cultural and something foreigners may not understand.

Obamacare did nothing to address the in- vs. out-of-network billing problem and may have made it worse.  With insurers jockeying to maintain and increase their profits under the new system, some of them simply pulled out of markets they deemed less lucrative, leaving people in certain areas with only one insurer, or none.  Some people are stuck in places with only one insurer and no in-network providers for hundreds of miles.  Almost all of the counties in this predicament are poor, rural, Southern, and voted for Trump.  These are the people Trump was pandering to when he lied that he would give them better and cheaper insurance than Obamacare.

Obamacare has cut the number of uninsured nearly in half and it has saved lives, not to mention improved quality of life for millions of people who could not obtain insurance previously.  But its reliance on the cooperation of states and insurance companies has left it vulnerable to high costs and limited coverage options.

So, what happens if it's repealed, you go back to status quo ante?

Obamacare & Trumpcare comparison
No, all except the most rabidly conservative Congressmen realise that is not an option.  The Rethugs would like to remove all government-subsidized healthcare, cut taxes, and leave everything to do with healthcare to the private sector (well, except for regulating women's bodies).  The callousness of this attitude is baffling to foreigners who see healthcare as a basic human right.  How can the richest country in the world let people suffer and die if they cannot afford to pay their healthcare costs?  The main reason is the myth of the American dream.  America, the fiction goes, is a classless society, with no barriers to unlimited socio-economic advancement.  So, if you are poor, it is your own fault.  Why should others who have worked hard for their money bear the costs of your laziness or unhealthy lifestyle?  Add to that an individualism that doesn't recognize societal benefits from public goods like education and healthcare and you have a fair part of the explanation for the Rethug mentality.  The legacy of Calvinism also figures in there, as well as a smattering of racism and sexism.

Yet even the most ideological Rethug Congressmen is shrewd about re-election.  Openly reducing access to healthcare is an electoral risk a few are not willing to take.  So, they have crafted a repeal bill that they can claim retains the most popular provisions of Obamacare, such as the requirement that insurers cover people with pre-existing conditions, and eliminates the unpopular ones, like the individual mandate.  (No, I am not kidding.  Yes, they are bad at math.)  It throws a bone to the fundies by cutting funding to Planned Parenthood, to companies by ending the employer mandate, and to the rich by cutting taxes.  The hard sell is going to be around the issue of out-of-pocket costs for consumers.  The main complaint about Obamacare was high premiums, coupled with high deductibles, co-pays, and coinsurance, despite the subsidies and caps.  The Senate bill eliminates minimum coverage, which will allow insurance companies to go back to selling useless plans – the kind that left so many millions of Americans underinsured – but which might have cheaper premiums, superficially appeasing voters who won't realise they are being screwed until they need the insurance.  And the ability to sell whatever useless plans they can get away with might entice insurers back into some of the markets they have pulled out of.  But cuts to Planned Parenthood, which millions of lower-income Americans rely on for basic care, the end of Medicaid expansion, raising the cost of insurance for older people from 3x to 5x what younger people pay, and drastically reducing the premium subsidies, are all likely to lead to higher out-of-pocket costs, even for plans with greatly reduced coverage.  Also, the elimination of the individual mandate combined with keeping the too-popular-to-cut requirement to insure people with pre-existing conditions is likely to cause premiums to keep rising, even for policies with useless coverage.  Overall, consumers will be paying more for less, the opposite of what their orange saviour Trump promised them.
Notice anything about where the uninsured are located?
Clearly, Obamacare and Trumpcare both have their problems, but what the hell should be done to fix this mess?

Well, obviously, what you have in the civilised world: Universal, single-payer healthcare.  But that is not politically viable.  One issue that no-one across the political spectrum has addressed is the cost of healthcare.  All of the debate is around who pays but no-one ever proposes limiting what providers charge.  Of course, intervention in the sacred free markets in the current political climate is about as likely as Trump spontaneously quoting Demosthenes in the original Greek in one of his speeches.  The most likely outcome is that enough Rethug Senators will get cold feet to prevent the repeal of Obamacare.  In the short-term, nothing will be done about the dearth of insurers in certain areas or the high out-of-pocket costs, leading to more Rethug electoral victories due to misplaced blame but no concrete change in policy.  If Dems were in charge, there might be some sort of public option brought into those markets that lack private insurers, but don't hold your breath—that's not covered.

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