Sunday, May 20, 2007

Which poison do you want?

On Friday afternoon, after two days of focusing on their individual likes and dislikes, the 208 Commission selected 4 health care reform proposals which will be modeled for economic consequences, and then sent the legislature next January with the Commission's recommendation of the best plan. They reserved a fifth spot for creating their own proposal for modeling -- and I predict that their own proposal will be their recommendation to the legislature.

Although commissioners spoke repeatedly about choosing a wide selection of plans across a broad spectrum between "markets" and government control, in the end, they firmly rejected the only plan for reforming medicine and health insurance using capitalism and its free market. All four selected options completely and fundamentally impose increasing government control and regulation, and will act as poison to systemically and systematically kill medicine and health insurance in Colorado. Why do I say that?

Over the coming weeks, you will begin to hear about different aspects of these plans from a lot of sources and they will focus on the differences. But let's focus on a fundamental today. All of these plans look at the Colorado State government as the solution. Three of the four proposals want to force every single Colorado resident to either purchase health insurance or be a part of a new government health care program -- and the government will determine what the benefits are and what the providers are paid.

All of these plans impose severe restrictions on at least a portion of both health insurance and the medical services markets. All increase the amount of medical services purchased by government -- and it's already the biggest purchaser of services in both markets. As the largest consumer of services and health insurance, its purchases affect the pricing and the amount and kind of services offered. But, in addition, government then imposes regulatory mandates and controls on what's left of the market, so that consumers are increasingly left with fewer choices at higher prices. And the capitalist marketplace is blamed for this result -- when in fact, it is the Emergency Medical Treatment and Active Labor Act (EMTALA) that has caused many hospitals to close their emergency rooms and physicians to stop practicing at hospitals with emergency rooms because they can't afford to treat patients without payment as this law requires them to do. There are many other examples.

Health care is not a right. Medicine is not a right. Health Insurance is not a right. Health, itself, is a contextual condition. "I feel better today." "I'm sick today." "I don't feel as well as I usually do." "I feel healthier today than I did ten years ago." These are all statements that reflect the contextual nature of health. There is no one absolute health condition applicable to all that any individual can strive to meet -- no one perfect blood pressure reading, no one perfect weight, no one perfect cholesterol reading, heart rate or any other measure of health. People even have different temperature readings. Our health measures are a matter of statistics -- of averages, of ranges -- and there are disagreements among medical professionals about standards for most of those. Health is one measure of how well we are living -- and it changes daily.

So, how do these four plans intend to reform health care in Colorado? The four plans are as follows:

1. The Better Health Care for Colorado plan (Better Health)-- proposed by the Service Employees International Union and the Colorado Association of Public Employees -- is characterized by the Commission as the "no mandate" plan. It expands Medicaid and provides subsidies to fund the purchase of private insurance for those up to 300% of the federal poverty level.

2. Solutions for A Healthy Colorado (Healthy Solutions) -- sponsored by the Colorado State Association of Health Underwriters -- is characterized by the commission as an individual mandate plan. This plan wants to eliminate "free riders" of health care -- and seeks to expand Medicaid. It would force every Colorado resident to obtain health insurance, and has a minimum core benefit package.

3. A Plan for Covering all Colorado (Plan for All) - submitted by the Committee for Colorado Health Care Solutions -- is characterized by the Commission as having individual mandates; employer mandates (or pay assessment); expands subsidies and Medicaid; provides minimum benefits of medical, dental, vision, substance abuse, mental health, and prescription drugs; and has a "purchasing pool" to negotiate insurance rates.

4. The Colorado Health Services Program (Single-Payer) - is a single-payer plan administered like a public utility with benefits to consumers and payment schedules to providers to be determined yearly. It would be independent of the legislature. It includes everyone and no one can opt out.

Three of these programs ("Health Solutions", "Plan for All" and "Single-Payer") explicitly state that health care is a right --- and the "Single-Payer" plan is the most forthright about this. It describes it as a right where a new government agency will annually decide what benefits to provide to the consumer -- and how much the doctors get paid. But, in fact, rights aren't benefits awarded by the government. Properly identified, rights are a moral principle that define and sanction a person's freedom of action in a social context, i.e. in society. Rights are freedoms to act and enforced by a proper government. These limited benefits forced on the residents of Colorado by the power of government are not rights.

The "Plan for All" and the "Single-Payer" plan seek to provide every kind of benefit -- vision, dental, mental health, substance abuse, wellness, medical, drugs, medical equipment, audiology, PT, home health and hospice care, as well as full long-term care. They would both have regulatory bodies with no or minimal legislative or court oversight and whose members would serve for 10 to 12 years. They both determine payment to the doctors using egalitarian principles (with some sort of incentive plan based on a standardized quality program), regardless of overhead, location, quality or any other factor that affects pricing in the marketplace. All providers -- including now dentists, opticians, nurses, and doctors are treated as widgets -- as another good -- and not as individuals who have the right to set their own practice guidelines and payment schedules. The single-payer plan seeks to fund this through "sin" taxes -- alcohol taxes to treat alcoholism, gasoline taxes to treat automobile related injuries, taxes on weapons and ammunition to treat firearm related injuries, as well as an income tax. The "Plan for All" would impose taxes on products with health-adverse impacts, e.g., tobacco and alcohol, or "luxury" products or services, a premium tax on health insurance and a tax on providers.

In particular, the "Single-Payer" and the "Plan for All", which both would create administrative bodies to determine consumer benefits and provider payments, put all residents of Colorado in the position of a beggar asking for a handout from the legislature or an administrative body -- how much do I get from the government this year? Each consumer and each doctor is restricted, hampered, and loses the ability to be a free and independent trader -- one who trades value for value -- based on each individual's rational assessment of the value of a particular service or good to her.

The "Better Health" plan, while not having employer or individual mandates, has, as its goal, universal care. It does impose many restrictions on the population it seeks to cover -- which is expand Medicaid to another 560,000 Colorado residents -- which would more than double the current Medicaid population. It would do this by including those up to 300% of the federal poverty level -- or a family of four of up to with an income of about $55,000. It calls these people low-income. It also creates a pool to fund subsidies for the low-income to purchase insurance and creates a Health Insurance Exchange. For these persons, it would provide limited options for coverage and emphasize managed care. These subsidized plans would be required to identify at least four lifestyle behaviors that clients would be responsible to actively follow to reach a health goal. It could include an initial assessment, follow-up in 90 days, compliance with a treatment plan, financial incentives to reward healthy behavior, and employer mandated support. This plan would treat these one-half million people as if they were small children.

But, the plan would ultimately affect all Colorado residents because someone has to pay for this program. There were 396,000 Medicaid participants in December 2005 according to the Colorado Medicaid Physician News at a cost of $1.5 billion (Another 1.5 billion was provided by the feds). The total state budget was around $15 billion then. More than doubling the Medicaid budget will affect all of Colorado. What new taxes do we see? And when this is not affordable and we have almost twenty percent of Colorado's population on Medicaid, where do we go then? The only solution that the legislature will suggest will be mandatory, universal care.

Finally, the "Healthy Solutions" plan mandates that all individual residents in Colorado purchase health insurance -- and that all insurers participate in the plan. They propose to fund this program with a 2 to 5% sales tax on all foods that have little or no nutritional value, such as fountain sodas and walk-up coffee, chips, candy and other "junk foods." They recommend that lawmakers encourage employers to push individuals to healthier lifestyles. It recommends that Medicaid start reimbursing providers at the same rate as the Colorado State Employees Health Benefit Plan. It seeks a Core Benefit Plan for Medicaid with a maximum annual benefit of $50,000, and premium subsidies for those up to 200% of Federal Poverty Level (or an income of $40,000 per year for a family of four). They also consider an employer-mandated contribution -- but only as a last resort.

So, pick your poison. A slower but, nevertheless, certain incremental death of medicine and health insurance through the "Better Health" plan. Or a quicker, faster death from one of the other three. The Commission was caught as a deer in headlights and blinded by the legislative mandate to any true reform -- to reducing government regulation and government control of medicine and health insurance. We don't have to be blind. We can reject the Commission's selection and the legislative supposition and premise that the only solution is more government. One thing is absolutely certain. More government control and regulation of medicine and health insurance means fewer quality doctors, fewer quality medicines, rationing and limiting of medical services available, as well as fewer innovations in medical treatment and care. The death of medicine is the death of us all.

We have to start talking about this now. Next year will be too late.