Thursday, July 23, 2009

"Healthy San Francisco" is No Model for Health Reform

Mayor Newsom touts his tax-hiking public-health bureaucracy as a model for national health reform. I managed to get a contrary opinion deep into opposition territory - the opinion page of the San Francico Chronicle.

Tuesday, July 21, 2009

U.S. Index of Health Ownership, 3rd edition

North Dakota tops, New York bottom of the barrel (for the third time in a row), in the latest edition of the U.S. Index of Health Ownership, which measures 24 variables of government interference in health care.

Monday, July 20, 2009

SCHIP's Race to the Bottom

The New York Times reports that 13 states have sought to bail out out their public-health bureaucracies by raiding taxpayers in the 37 other states. They have marched to the trough to take advantage of the SCHIP expansion signed by President Obama soon after he took office. (The newspaper didn't quite put it like that.)

SCHIP (State Children's Health Insurance Program), of course, creates a "race to the bottom" of government dependency because a state has to spend its own taxpayers' money to "prime the pump" that fills the trough with federal dollars. One silver lining to the cloud of recession is that most states simply do not have access to enough of their own taxpayers' funds to execute this raid.

We can all be thankful.

SCHIP expansion is popular, because it's "for the kids" and the expansion is primarilly financed by taxes on smokers. What the NY Times neglects to note is that SCHIP crowds out private coverage by at least 56%, which will get even worse as states enrol kids from higher-income households, as I've discussed before.

Furthermore, the Wall Street Journal notes a side effect of Government's unhealthy addiction to tobacco taxes - violent crime as states "go to war" on cigarette smuggling (which would not exist without discriminatory taxation).

We are effectively in an era of neo-prohibition, where governments' demonize smokers' peaceful habit in order to seize their earnings to fund a state take-over of children's access to medical services.

Thursday, July 9, 2009

Health Plan CEO for Governor of Massachusetts?

With an announcement that will certainly have implications for the national debate on health reform, Charlie Baker, the CEO of Harvard Pilgrim HealthCare, has announced that he is a candidate for the Republican nomination for governor of Massachusetts.

Gutsy move: He's a leader in the industry (health insurance) that 4 of 10 people believe is most responsible for increasing health costs, and "enjoys" a reputation as low as tobacco and oil companies.

More importantly, he was a key player in Governor Romney's reform that mandated universal health coverage, about which he was skeptical (as described very forthrightly in his blog, and about which I recently scribbled.) The media and voters are going to expect him to have some solutions to the health crisis.

Because of the likelihood of a national coverage mandate, and Mitt Romney's continuing presence as a presidential candidate, Baker the politician's views on health reform will be at least as interesting as Baker the health-plan CEO's.

Women Better Patients Than Men

A new study by CIGNA reports that women are 1/3 more likely to check prices of medical procedures than men are: 20% of women checked prices versus only 15% of men. Remarkably, some of them seem to enjoy it.

This is an interesting finding, and one that I would never have thought to pursue. Why did CIGNA do it? My guess us that men will soon be getting messages that we should bring our wives to the doctor with us: It may motivate us to swich to generic prescriptions, when appropriate, to keep costs down.

What will the government do to screw this up? I can see a flood of nonsense from the political class that consumer-driven health care is disadvantagous to women (which is actually an old tactic), because they are "forced" to make decisions about treatment based on costs.

Wednesday, July 8, 2009

Medical Bankruptcy Equal in Canada & the U.S.

While the reported incidence of "medical bankruptcy" in the U.S. is grossly overstated, an equally unsubstantiated claim is that a single-payer, government-monopoly health system would eliminate medical costs as a cause of bankruptcy. (If you troll the Internet, you'll find that it seems to be an article of faith.)

Indeed, I sort of fell for it myself, when I sarcastically noted that if the government exerts absolute control over citizens' access to medical services, and forbids them spending directly for care, they cannot go bankrupt from medical costs.

But then news from Canada led me to believe that people do go bankrupt from medical costs. After all, if you are sick enough and the government will not treat you in time, a lot of costly problems will pile up.

All we needed was some good research on the relative rates of medical bankruptcy in the two countries. Well! What do you know? Brett Skinner & Mark Rovere of The Fraser Institute has rode (ridden?) to the rescue with a well researched article concluding that the rate of medical bankruptcy is about the same in Canada and the U.S.

No "medical bankruptcy" under government-monopoly health care? Don't you believe it.

Tuesday, July 7, 2009

Sebelius' $100 Million SCHIP Marketing Bailout

One of the most pathetic consequences of the federal government's drive to control children's access to medical services is the failure of the State Children's Health Insurance Program (SCHIP) to enrol most of the kids eligible for it. In California, 80% of families eligible for SCHIP reject it for their kids.

The obvious remedy? Bail out SCHIP's sales & marketing operation. 350 self-styled advocacy groups joined U.S. Secretary of Health & Human Services Kathleen Sebelius for a teleconference where she announced her intention to release $40 million of a budgeted $100 million for "outreach".

Release the hounds!

If she really wanted to enrol kids in SCHIP, instead of perverting civic groups through government handouts, she'd offer commissions to insurance brokers to sign up kids.

Obviously, that would be unacceptable - because insurance brokers are businesses, not community activists.

Was ACORN on the teleconference? I have no idea. I think it's time for a stronger spotlight of transparency on groups that accept taxpayers' money to promote government dependency for health care.

Monday, July 6, 2009

Is Maine Ground Zero for Health Reform?

Tarren Bragdon and colleagues at the Maine Heritage Policy Center are obviously too humble to claim credit in the struggle for health freedom in Maine and the U.S. So, let me do it for them by noting today's New York Times, which runs an article describing Maine as sort of a Ground Zero for health reform.

Maine, of course, is the home of the two Republican U.S. Senators potentially most favorable to the idea of the government controlling people's access to medical services. So, the SEIU (Service Employees International Union), which would like nothing more than to take over American health care, has poured money into the state.

Fortunately, the Maine Heritage Policy Center's Crisis to Cure tour, which the New York Times notes, emphasizes the costs of current government intervention, especially Maine's failed Dirigo plan.

Frankly, I'm surprised that the New York Times would deign to report that there's an alternative to "reform" that gives more power to government, instead of the people. Kudos to the Maine Heritage Policy Center!

Thursday, July 2, 2009

"Universal" Care=More ER Use: An Old Lesson Relearned

Tomorrow is Independence Day, when we look back to the successful Revolution of 1776. I suppose we can't quite "celebrate" July 4, because we've surrendered much of that hard-won independence back to our home-grown political class.

Speaking of our political class, if I had a dime for every time President Obama or another of our betters announced that increasing coverage through more government programs would result in better access to primary care and less ER use, I'd be able to pay my taxes many times over.
There is no evidence of such an effect, as recent analyzes of the Massachusetts "reform" that introduced "universal" coverage have discussed (here and here). In a previous analysis of hospital ER use in California, I found the same effect. Indeed, ERs were far more likely to be jammed with people who had coverage, and whose symptoms could have been better handled in a primary-care physician's office, than the uninsured.

Will our rulers, who want to impose their vision of health "reform" on us, learn from this evidence? Fat chance!

Overcome by a wave of nostalgia for lost liberties, I decided to have a quick look at evidence of the effect of "universal" health care in the scholarly literature:

Exhibit A: an article from 1973 reporting a survey of Montreal households conducted over 12 months in 1969 and 1970, just before "universal" coverage was imposed by the provincial government of Quebec in 1971. The survey did conclude that higher-income households used more medical services than lower-income households did. Furthermore, 4/5ths of ER visits were for non-urgent reasons.

Sounds like those folks needed "universal" coverage, right? Wrong.

Exhibit B: the same authors published a subsequent article in 1978, which reported that ER visits increased by 14% annually in the five years after "universal" coverage versus 7% in the five years prior. Before "universal" coverage, 33% of patients surveyed had attempted to contact a physician before going to the ER and 63% were successful. After "universal" coverage, 39% of patients had attempted to contact a physician but only 38% were successful. Most of the increase in coverage happened through the ER, not primary-care doctors.

Three decades later, Massachusetts is learning the same lesson - or not.

Wednesday, July 1, 2009

Gaming State-Run Health Insurance in Massachusetts

I hope you don't mind if I'm a little lazy this morning and simply point you to a post by the CEO of Harvard Pilgrim Healthcare, which addresses an issue which I do not believe we have covered in our analyzes of Massachusetts. (I was directed to it by Bob Laszewski's blog.)

Critical examination of Massachusetts' experience with a government-run health-care "market" (e.g. Connector) are prevalent in this blog. Recent analyzes from the consumer-directed reform camp, by Grace-Marie Turner & Tara Persico, as well as Michael Tanner have focused on the budget-busting increases in costs and the absence of incentives for patients to use medical services appropriately (although Mr. Tanner does allude to adverse selection, the topic of this post).

Mr. Baker of Harvard Pilgrim points out that merging the small-group and individual markets, as the Connector does, creates an incentive for individuals to game the system by only buying health insurance when they become sick. Before the "reform", Massachusetts imposed guaranteed issue and community rating on the individual market, so people were already motivated to wait until they became sick to buy health insurance. (This is a key reason why the Bay State ranks so poorly in the U.S. Index of Health Ownership.)

However, this adverse selection was minimized because state law allowed insurers to exclude pre-existing conditions for up to six months. Under the Connector, which merges the small-group and individual markets, it would have to do the same for the much larger small-group market alongside the individual market.

Follow me so far?

Insurers were unwilling to do this in the small-group market, so they had to remove the exclusion in the individual market. The tax for not obeying the mandate to have health insurance is about $900 annually, or $75 monthly), which people are content to pay if they know they can wait until they get sick and get individual coverage through the Connector with no exclusion for pre-existing conditions.

Result? Death spiral! Mr. Baker reports that Harvard Pilgrim's individual policies written since the "reform" only last five months, and the premiums are ramping up fast.
What will the state do? Well, I suspect it will do what all government's do when their policies fail: impose more government.