Achieving Universal Health Care for Kids (& Adults): The Minnesota Health Plan Ann Settgast, MD University of Minnesota Pediatric Grand Rounds August 31, 2011 Disclosures • No financial relationships • No discussion of off label or investigational use The U.S. health care system becomes a more embarrassing disaster each year… — Donald Kennedy, former President, Stanford University; former Editor Science, August 15, 2003 America has the best health care system in the world, pure and simple. — President George W. Bush, addressing the American Hospital Association, May 1, 2006 The U.S. health care system becomes a more embarrassing disaster each year… — Donald Kennedy, former President, Stanford University; former Editor Science, August 15, 2003 America has the best health care in the world, pure and simple. — President George W. Bush, addressing the American Hospital Association, May 1, 2006 - National research & education organization of ~ 18,000 physicians and medical students advocating universal, comprehensive, singlepayer health insurance - Single-payer care provides a more cost efficient and equitable way to administer health care - “…access to high-quality health care is a right of all people and should be provided equitably as a public service rather than bought and sold as a commodity…” Objectives • Distinguish single-payer healthcare reform from other reform proposals • Define the problems of uninsurance and underinsurance as they relate to US children • Introduce the Minnesota single-payer movement Definitions • Universal health care – Access for all – Doesn’t specify how • Socialized medicine – Publicly financed – Publicly owned • Single-payer system – Publicly financed – Privately owned (delivered) What is Single-Payer? • Hospitals & clinics now bill > 1000 payers (insurers) • In a single-payer system, there would be no private health insurance • Recovery of $400 billion annually due to drastically reduced administrative costs Why Single-Payer? Access US has major problems in all 3 areas Cost Quality 480,000 Uninsured 68% of the uninsured nonelderly have a FULL-TIME worker in the household. Source: http://www.census.gov/hhes/www/hlthins/hlthins.html Does being uninsured matter? 45,000 adult deaths per year Source: Wilper et al. American Journal of Public Health, 2009 Likelihood of Hospitalization After an Injury by Coverage Type n=1847 injuries in children <18 yrs Hospitalization Insurance Type Adjusted OR 95% Private 2.21 0.73-6.63 Medicaid Ref Uninsured 4.07 1.13-14.66 S Hostetler et al., Health Care Access After Injury by Insurance Type in a Pediatric Population, Pediatric Emergency Care Vol. 21 (7) July 2005 National Health Interview Survey 2000,01,02 * Adjusted for gender, race, age, region, hospital type, comorbid disease J Public Health (2010) 32 (2): 236-244 (Data from 23 535 491 pediatric inpatient hospitalizations over 18 years from 37 US states were analyzed). “The Hidden Uninsured” Among Children Insured in Jan 2006, Percent Uninsured in Each Month, Jan 2006 to Dec 2007 Underinsurance • 62% of personal bankruptcies due to medical expenses (2007) – 50% in 2001 • 78% of people with medical bankruptcies had health insurance when they got sick “Medical impoverishment, although common in poor nations, is almost unheard of in wealthy countries other than the US.” Himmelstein et al, American Journal of Medicine, June 4, 2009 “Underinsurance Among Children in the United States”, NEJM, 2010, 363;9 • 14.1 million US children with continuous coverage are underinsured • Underinsurance defined: – “Insurance does not provide adequate benefits, provider choices, or coverage of costs.” Data: 2007 National Survey of Children’s Health – sample size 91,642 children “Underinsurance Among Children in the United States”, NEJM, 2010, 363;9 Why Single-Payer? Access US has major problems in all 3 areas Cost Quality Growth in Total Health Expenditure Per Capita, U.S. and Selected Countries, 1970-2008 $8,000 Per Capita Spending - PPP Adjusted $7,000 $6,000 United States $5,000 Switzerland Canada $4,000 OECD Average Sweden $3,000 United Kingdom $2,000 $1,000 $0 1970 1975 1980 1985 1990 1995 2000 2005 Source: Organisation for Economic Co-operation and Development (2010), "OECD Health Data", OECD Health Statistics (database). doi: 10.1787/data-00350en (Accessed on 14 February 2011). Notes: Data from Australia and Japan are 2007 data. Figures for Belgium, Canada, Netherlands, Norway and Switzerland, are OECD estimates. Numbers are PPP adjusted. Break in series: CAN(1995); SWE(1993, 2001); SWI(1995); UK (1997). Numbers are PPP adjusted. Estimates for Canada and Switzerland in 2008. Why Single-Payer? Access US has major problems in all 3 areas Cost Quality US ranked 37th by the WHO World Health Report Why do we pay more and get less? • 31 cents of each healthcare $ is spent on administration • Administrative spending comes from two sides: – Providers – Payers (Steffie Woolhandler et al., “Costs of Health Care Administration in the United States and Canada,” New England Journal of Medicine 2003;349:768-75) Interactions between physician practices & insurers are costly $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Ontario physician practices US physician practices Spending per physician per year interacting with payer(s) Morra et al, Health Affairs, August 2011, 30:8, 1443-1450 Why do we pay more and get less? • 31 cents of each healthcare $ is spent on administration • Administrative spending comes from two sides: – Providers – Payers (Steffie Woolhandler et al., “Costs of Health Care Administration in the United States and Canada,” New England Journal of Medicine 2003;349:768-75). Insurance (Payer) Overhead 30% 26.5% 19.9% 20% 16.3% 10% 3.1% 0% Medicare Non-Profit Blues Commercial Carriers International Journal of Health Services 2005; 35(1): 64-90 Investor-Owned Blues Why are their administrative costs higher than Medicare’s? • • • • • • • • • Advertising/marketing Enrolling/disenrolling Underwriting Denial of claims Deciding what to cover (exclusions, pre-existing conditions) Negotiating multiple contracts with providers Lobbying ($1.2 billion in 2009) Salaries (CEO pay at top 10 insurers in 2009 = $228 million) Profit (Top 5 insurers reported $11.7 billion in 2010) April 13, 2011 UnitedHealth Group Inc. CEO Stephen Hemsley took home $48.8 million in total compensation in 2010. Admin costs of private payers versus Medicare: • Do these “services” make our patients healthier? • Should we be spending these healthcare dollars on healthcare?? • Do these “services” help you as a doctor to diagnose, treat, or prevent illness? Is it feasible??? • We already have… – Excellent hospitals and well-trained professionals – A nation of vast wealth with sufficient spending – Acceptance of pooled resources to publicly fund the military, the NIH, the CDC, highways and roads, police and fire services, schools, libraries, water sanitation, etc. • And… – Every other industrialized nation is doing it! What do doctors think of singlepayer? • 5000 surveys, 2008: 51% response rate • “In principle, do you support or oppose government legislation to establish national health insurance?” • 59% supported (49% in 2002) Support for government legislation to establish National Health Insurance in 2007 and 2002, by specialty Annals of Internal Medicine, 1 April 2008, Volume 148 Issue 7, Pages 566-567 But didn’t we just pass historic national reform? • Individual Mandate – Mandated health insurance for some (23 million will remain uninsured in 2019) – Policies required to cover at least 60% of expected health costs (problem of underinsurance remains alive and well) – Raises costs “While the legislation will enhance access to insurance, the trade-off will be an accelerated crisis of costs and perpetuation of the current dysfunction…” – Jeffrey Flier, dean of Harvard Medical School SF 8/HF 51 Chief author Senator John Marty Minnesota Health Plan • Who: All Minnesota residents • What: All medically necessary services – Inpatient/outpatient services – Rehab care/NH care/HHC/Hospice – Immunizations/preventive care – Prescription drugs/Medical equipment – Mental health care – Dental and vision care • How: Funded through premiums based on ability to pay + a business health tax Unique features of a SinglePayer System • • • • • Guaranteed care for all Decreased costs Healthcare de-linked from employment Free choice of provider Publicly accountable & responsive Thank you for your attention! • Educate yourself and others (www.pnhp.org) • Join PNHP-MN and/or sign our physician resolution • Invite a PNHP speaker to your organization or group’s event • Support the single payer resolution at the 2012 AAP annual leadership meeting “Of all the forms of inequality, injustice in healthcare is the most shocking and inhumane.” - Dr. Martin Luther King, Jr.