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Friday, October 21, 2016

Today the Weekend Reader brings you Reinventing American Health Care, by bioethicist, former special advisor on health care reform to the White House, and current senior fellow at the Center for American Progress, Ezekiel Emanuel. According to Emanuel, health care in the U.S. was a “terribly complex, blatantly unjust, outrageously expensive, grossly inefficient, error-prone system,” but the Affordable Care Act aims to fix all that. Emanuel’s extensive background in both medicine and public policy is poured into Reinventing American Health Caremaking it a manual for understanding why health care is not only a divisive issue, but how the ACA will greatly improve our health care system for years to come. 

Despite being an advocate for the ACA, Emanuel recognizes that it was not a perfect law as implemented and will need improvements moving forward. The excerpt below highlights two of his four recommendations for continuing to develop the 2010 law. 

You can purchase the book here.

What Are the Post-ACA Reforms?

The Affordable Care Act was passed in 2010. However many changes it introduced to improve the American health care system, it was far from perfect. Everyone recognizes there were some things left out, some things done poorly, and some things that need further modification. There are many additional changes that could be implemented to improve the system.

There are four important reforms that build on the ACA to advance health promotion and prevention, cost control, and quality improvement that are “shovel ready,” meaning they can be initiated quickly and with lasting impact.

Raise Cigarette Taxes

A quick and easy way to prevent serious illness is to raise cigarette taxes.Cigarettes and small cigars represent the single-greatest preventable cause of death in the country. Over the last 50 years or so, the United States has reduced adult smoking rates by half—a great public health triumph. According to most experts a combination of factors, from eliminating advertising and adding graphic package warnings to forcing smokers out of restaurants and office buildings and raising cigarette taxes, have contributed to positive outcomes. The reduction in smoking rates has tapered off, however. Today about 20% of adults smoke, and it has remained at about that level for the last 5 years.

One effective way to further reduce smoking is to raise its cost. In 1862, during the Civil War, the federal government imposed an excise tax on tobacco. By 1969 all states had their own additional excise tax on tobacco. In 2009 the federal excise tax on cigarettes was raised from 39 cents to $1.01. If we raised the federal excise tax by 50 cents, the Congressional Budget Office estimates smoking rates would drop by about 3 percent, mainly by persuading younger people not to take up smoking. Because most people who smoke start as teenagers, this would lead to a prolonged decline in the smoking rates as well as declines in emphysema, lung cancer, heart disease, and the many tobacco-related illnesses—an important long-term preventive measure. Furthermore, this tax will reduce the disparity in smoking. Lower-income Americans are more likely to smoke and are more price sensitive. Raising the cigarette tax will disproportionately reduce smoking among Americans with lower incomes—a very good thing.

Not only would this policy improve health, it would also generate $37 billion over the next 10 years. That money could be used either to reduce the deficit or even to further improve the health of American children by investing in early childhood interventions.

More Competitive Bidding

Ever wonder how much a wheelchair costs? Or, more importantly, ever wonder who decides how much a wheelchair costs? You probably aren’t that concerned about the price of a wheelchair because in all likelihood you don’t think you’ll ever need one. You may feel that medical prices are too high but think you don’t have much bargaining power to influence them. Private insurance companies and public payers like Medicare have the power to ensure the prices are low.

Buy From

The problem is that our system for setting prices and paying for medical devices, equipment, and procedures is broken—and we need to fix it. Before the ACA, the government effectively set the price of a wheelchair. Medicare determined what it paid manufacturers for their wheelchairs.However, few Americans believe government price setting is the best way to ensure low-cost, high-quality wheelchairs; instead, most Americans believe the market is the best way to set prices.

The ACA contains provisions designed to change the system, to move from a government-price setting to market-price setting. One of these provisions is competitive bidding in Medicare, requiring competitive bidding mainly for wheelchairs, hospital beds, oxygen equipment, artificial limbs, and a few other things—what are technically called durable medical equipment, prosthetics, and orthotics.

The program began in 9 geographic areas in January 2011. Instead of the government setting prices, the companies bid on how much equipment they would supply and at what price. The program has succeeded remarkably. Overall, prices for wheelchairs, hospital beds, walkers, oxygen equipment, and other goods dropped more than 40 percent in 3 years. The ACA requires this competitive bidding program expand nationwide by 2016. The CBO projects that over the next 10 years it will save the government nearly $26 billion and Medicare beneficiaries, through reduced co-payments, $17 billion.

Behind the scenes, however, private companies that typically champion the free market in their public remarks are trying to modify and weaken the law. They have profited from the old government price-setting arrangement and, despite their rhetoric, don’t really like the competitive market as much. Using claims of artificially low prices, limited supply, and shoddy quality, they are suggesting ways to keep prices up.

What should the government do? Resist these company entreaties and expand competitive bidding. First, given the success of the program thus far, there is no compelling reason to wait until 2016 to expand it nationwide. Why not expand it nationwide by 2015 and reap billions in additional savings not just for the government but also for seniors?

Second, to help CMS run this process even better, we might establish an independent advisory board composed of business and academic experts in the competitive bidding process. For instance, wouldn’t you want Walmart’s or GE’s experts to help run the government’s competitive bidding process? There are economists who study successful and unsuccessful competitive bidding processes that can also help to improve the operations. Adjustments in how the competitive bidding process is run can help ensure low prices, a diversity of suppliers, and high-quality equipment.

If you enjoyed this excerpt, purchase the full book here.

Excerpted from Reinventing American Health Care: How the Affordable Care Act Will Improve Our Terribly Complex, Blatantly Unjust, Outrageously Expensive, Grossly Inefficient, Error-Prone System by Ezekiel J. Emanuel (March 2014).  Reprinted with permission from PublicAffairs.

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  • Duke Leigh

    Fifteen paragraphs of “weekend reading”.

  • paulyz

    Affordable Health Care for ALL (American Citizens) would be attainable if we didn’t have Millions of Illegal “immigrants using it for Free. We must get our borders fully secured & mandatory E-verify passed & enforced or it may fall-apart, as well as the drain on our other Social Programs, schools, resources, etc.

    • Independent1

      Pure hogwash as usual!!!!!

      If illegals purchase insurance through the private market, they would not be eligible for subsidies, so they would be paying for their insurance just like anyone else; which would not be eliciting an freebees from our government . Where are you getting your absurd notions?????

  • Dominick Vila

    Any person with half a functioning brain understands that access to affordable healthcare, and access to preventive medicine, are beneficial to ALL Americans. It doesn’t take a genius to understand that the ACA also has the potential of helping corporate America become more profitable and competitive. Needless to say, process improvements, more effective oversight to minimize the probability of fraud, reduction in the frequency of duplication, unconditional healthcare to the handicapped, and the elimination of insurance caps are all steps in the right direction.
    It is also worthwhile to remember that language, and strict regulation, was introduced to ensure tax payers monies were not used to support abortion or to provide medical care to illegal immigrants.

    • paulyz

      When Illegals aliens receive “another” Amnesty, Illegal aliens will be eligible for Obamacare. That is why Pres. Obama is urging Illegals to sign up for Obamacare and not to worry about deportation. See for yourself.

      • Dominick Vila

        The only amnesty of illegal immigrants in recent decades was granted by former President Reagan in 1986, when the status of four million illegal immigrants was legitimized.
        President Obama has not urged illegal immigrants to sign up for Obamacare. ACA applicants sign up with participating insurance companies. What some beneficiaries are eligible for, because of income, is subsidies, which illegal immigrants are ineligible for because of a clause in ACA that prohibits extending services and giving subsidies to them.

      • Independent1

        As usual, your posts are full of hot air – including lies and distortions. The truth is, that illegal immigrants DO NOT cost our country BIG TIME. In Fact, there’s some evidence they actually contribute more to the economy than they cost us, and they contribute about 7 billion/yr into Social Security, which they aren’t even eligible for; so do a little research and get your facts straight before you start blathering even more:

        CBO study:

        During 2007, the nonpartisan Congressional Budget Office reviewed 29 reports published over 15 years on the impact of unauthorized immigrants on the budgets of state and local governments. While cautioning that the reports are not a suitable basis for developing an aggregate national effect across all states, they concluded that:[21]

        State and local governments incur costs for providing services to unauthorized immigrants and have limited options for avoiding or minimizing those costs;

        The amount that state and local governments spend on services for unauthorized immigrants represents a small percentage of the total amount spent by those governments to provide such services to residents in their jurisdictions;

        The tax revenues that unauthorized immigrants generate for state and local governments do not offset the total cost of services provided to those immigrants, although the impact is most likely modest; and

        Federal aid programs offer resources to state and local governments that provide services to unauthorized immigrants, but those funds do not fully cover the costs incurred by those governments.

        Note in this one that even in Texas, they estimate that illegals contribute as much as 18 billion to the Texas economy:

        Taxes contributed[edit]

        Most arguments against illegal immigration begin with the premise that the illegal don’t pay income taxes, and that they therefore take more in services than they contribute. However, IRS estimates that about 6 million unauthorized immigrants file individual income tax returns each year.[21] Research reviewed by the nonpartisan Congressional Budget Office indicates that between 30 percent and 50 percent of unauthorized immigrants pay federal, state, and local taxes.[21] Illegal immigrants are estimated to pay in about $7 billion per year into Social Security.[26] In addition, they spend millions of dollars per year, which supports the US economy and helps to create new jobs. The Texas State Comptroller reported in 2006 that the 1.4 million illegal immigrants in Texas alone added almost $18 billion to the state’s budget, and paid $1.2 billion in state services they used.[27]

        The Social Security and Medicare contributions of illegal immigrants directly support older Americans, as illegal immigrants are not eligible to receive these services.[28] The Internal Revenue Service issues an Individual Taxpayer Identification Number (ITIN) regardless of immigration status because both resident andnonresident aliens may have Federal tax return and payment responsibilities under the Internal Revenue Code. Federal tax law prohibits the IRS from sharing data with other government agencies including the INS. In 2006 1.4 million people used ITIN when filing taxes, of which more than half were illegal immigrants.[29]

      • Independent1

        And here’s another opinion from someone more expert than either you or me:

        Professor of Law Francine Lipman [57] writes that the belief that illegal migrants are exploiting the US economy and that they cost more in services than they contribute to the economy is “undeniably false”. Lipman asserts that “illegal immigrants actually contribute more to public coffers in taxes than they cost in social services” and “contribute to the U.S. economy through their investments and consumption of goods and services; filling of millions of essential worker positions resulting in subsidiary job creation, increased productivity and lower costs of goods and services; and unrequited contributions to Social Security, Medicare and unemployment insurance programs.”[58]

      • charleo1

        The reality about our immigration system is, it’s flat broken. Another reality about our immigration system is, the number one obstacle to fixing it, is a political one. Right now, there is one particular political Party with enough power to either help reform, and fix the system. Including stopping the open, and unregulated employment of the undocumented, that serves as the number one attractant for illegal entry. Or to stop immigration reform initiatives altogether, by whipping up fears surrounding the amnesty issue. Or, use the issue as a political cudgel to drive their own Party further Right. Or, demand the President fix the broken system. Claim he’s not trying hard
        enough, or he’s actually allowing a free for all, or they would
        consider working the problem, but they have trust issues with Obama. About the lamest assed excuse, I’ve ever heard in my life. So then, the first thing that must be done, since this immigration is a big complicated subject, that will take both Parties, working in a spirit of cooperation to fix it, is to bring this one Pigheaded Party to the table. Don’t you agree? Of course you don’t. Because as per typical of Right Wing adherents, you actually care very little about immigration, per say. Except that it is a subject where there seems to b a lot of political hay to be made. As we’ve seen it’s one more excuse to not reform healthcare. It’s a great rabble rouser at political campaigns. “What would you do at the fence?” “Oh, I’d electrify it!” “Well, I’d dig a moat, and put gators in it!” Right?
        A lot of yucking it up, for folks so tore up about immigration,
        if you ask me. Plus, if they did jump in, and made the system better, with Obama as President, might reflect favorably on him. And that is never a good political result, no matter what subject we’re discussing. Then there’s all that corporate money. Always the folks in there that like our immigration system, with all it’s open door employment policies just fine the way it is, thank you very much. And, unlike the rabble rousers, they are very serious about going after politicians dumb enough to try to change any of it. Now, if you were running as a Right Winger, and wanted to win. Tell me you wouldn’t find it much easier to just blame a President. Than to run the gauntlet of big money opposition required to fix the immigration system of your Country. Right.

  • Mark Gehrke

    Obama Care works? Not for me and many others.My deductible went up $3000+ dollars PERIOD! When I was suppose to save as much as $2400 PERIOD. It wasn’t suppose to change PERIOD. Others lost their health care completely. Now this maybe modern math too you — but it does not compute.