Just a quick FYI - Today’s Boston Globe reports that the Federal Government has approved a new 3 year Medicaid demonstration waiver for Massachusetts - with $10.6 billion to enable the continuation and growth of the state’s health insurance coverage expansion program.  The original 3 year waiver expired at the end of June, and the state and Federal officials had been discussing a new 3 year waiver for many months before that deadline.  Since the end of June, the state’s program has been running on a series of several week extensions to the old waiver granted by the Federal Government.

A couple of months ago I wrote about how one percent of adults in the US get free government health care.  While the statistics in the February Pew study were very interesting (and somewhat shocking), I saw a report in a local Connecticut newspaper (The Day, June 26th) that put a face on these statistics.

The Day’s story was about Jihad Abdulshaheed, a 36-year-old man who had been incarcerated since November 2007.  The judge was prepared to sentence to a one year sentence, and since he had already served at least 50% of his time, under the Department of Corrections guidelines for nonviolent prisoners he could have been released the next day.

However, this is where the story gets very interesting.  The man asked the Judge to hold off his sentencing “because he is waiting for the Department of Correction to schedule his surgery for a groin hernia.”  The newspaper also noted that the DOC’s health care budget for its 23,000 prisoners was $99.3 million.  This works out to a little more than $4,300 per prison.  It seems that finding a way to release this man, and still pay for his hernia surgery would make more sense than keeping him locked up until the DOC can pay for the surgery……. I also wonder about his follow-up care? Where will he get it - in prison or outside?  And how will that be paid for?

This man’s situation and the Pew study illustrates how communicating the essence of a healthcare story can involve statistics, analyses, and anecdotes.  The first two provides a framework if the issue, and the anecdote puts a face on that skeleton.  Each one can be powerful, but together they create a remarkable picture that can change policies, attitudes and actions.

A recent report from the Pew Foundation indicated that 1 out of 100 adults in the US get free government health care with no premiums, deductibles or co-payments. The reason this report didn’t get more media attention was because the 1% of Americans getting free government health care are behind bars – as in prison or jail.

The Pew report indicates that for the first time, more than 1 in 100 adults in America are in prison or jail. That’s over 2.3 million in state or federal prisons or local jails, and the numbers and percentages have been growing. (See the Department of Justice chart below)

This data is an interesting launching point into other aspects of our current health care system’s problems:

First, health care costs for people behind bars represent about 10% of the costs of incarceration. (In 2004 this was about $3.7 billion.) And as the Pew report notes, “Under the 1976 U.S. Supreme Court ruling Estelle v. Gamble, states are compelled to provide a constitutionally adequate level of medical care, or care that generally meets a “community standard.” (I assume that Federal prisons are required to meet a similar standard.)

This was the basis for Harris Wofford’s 1991 successful campaign message, (in a special election for the US Senate), that Americans in jail have a guaranteed right to health care, but nobody else does. He was quoted in the New York Times in 1994 as saying about health insurance: “The wealthy have it. The poor have it. If you go to jail, you have it. Only the middle class doesn’t have it, and I don’t think that makes much sense.” (It will be interesting to see how the health care issues of costs and access play out in this year’s elections.)

Second, upon leaving prison (or jail) these individuals are not automatically enrolled in any type of health insurance. Given that they are likely making a difficult transition back into unincarcerated society, health insurance paperwork is probably not their highest priority. A study done by the American Public Health Association of parolees in Los Angles County described these challenges:

Many of the parolees’ illnesses go undiagnosed and untreated by prison physicians. To exacerbate the problem, California’s prison-based health care system does not prepare parolees to use public and private health clinics in the counties where they will reside. There is no coordination between counties and prisons in planning for the continued care of inmates after they are released.

Most parolees do not have medical insurance or stable sources of medical services. Eligible parolees may sign up for various programs but few do, often because they are unable to complete required application forms, do not possess appropriate personal identification documents, and/or have no permanent address. If parolees do succeed in applying for public health insurance programs, they often experience long delays while their enrollments are finalized.

Third, these individuals have more health care needs than average. As the APHA report found, parolees in LA County had:

• 4 times higher rate of active tuberculosis
• 9-10 times higher rate of hepatitis C
• 5 times higher rate of AIDS
• 1.5 -5 times higher rate of mental illness

Fourth, about 25% of children get health insurance through Medicaid or the State Children’s Health Insurance Program (~34 million), about another 24 million adults have insurance through Medicaid, about 3 million Americans get health care from the Veterans Affairs (VA) health system, and over 8 million have health insurance benefits through the Federal Employees Health Benefits Program.

Together this all paints a picture where multiple government health systems lack coordination. One of the most likely pairs for coordination would be the government run Department of Defense and Veterans Administration health programs, but they have had significant coordination problems that they continue to work on today. Conversely, one of the best examples of coordination may be in the private sector, where people can transition from one private insurer to another if they maintain insurance coverage. However, this ability is not an innate result of the market, but was a provision in the Health Insurance Portability and Accountability Act (HIPAA) of 1996, and illustrates the managed-market reality of the US health care system.

Some would argue that this all just means we should have a single-payer health care system. However, while that may look good in theory, the challenges of getting from our current system to a single payer program are beyond huge. And even if that is our ultimate goal, getting better coordination between programs would make lots of sense – as would making it easier (or routine) for people being released from behind bars to get health insurance. After all, we do this for people leaving their jobs by enabling them to continue their employee coverage (this was in the 1986 COBRA law), and then transition to another private insurance plan under HIPAA. So we should be able to do something similar for people being released from jail, shouldn’t we?

What do you think?

A year ago the hype in healthcare was about state-based reform initiatives. Massachusetts was implementing its law, and several other states - including California - were considering their own proposals for increasing insurance coverage as a first step towards universal coverage and cost containment.

How things have changed in a year. Not only has California’s initiative crumbled under the expected costs to employers, but the economic downturn has undercut states’ healthcare expansion ideas, and may force them to cut back Medicaid enrollment and/or services. This week’s National Journal has an article titled “State’s Rapidly Shifting Gears,” that discusses these and other issues, including how a few years ago states cut their Medicaid payments to providers, so that on average Medicaid pays physicians 69% of Medicare levels, and how pending Federal Medicaid rules and proposals would reduce funding for State Medicaid programs making it difficult for states to reverse these payment reductions.

The importance of our current economic uncertainty for health reform initiatives is tremendous. Consider the following facts:

• Massachusetts’ Medicaid waiver is up for renewal this summer. If this isn’t successfully negotiated and renewed, it could mean the collapse of the state’s insurance expansion program - which is already running well over budget because of underestimates of the number of uninsured who would enroll.
• As the economy falters, not only do more people end up out of work, but they also end up uninsured - with about 40% of them enrolling in Medicaid or SCHIP.
• Medicaid costs represent about 20-24% of state budgets, and 49 states have requirements for balanced budgets.
• National Journal’s poll of political insiders (April 12th issue) showed that 83% of Democrats and 79% of Republicans believe that the economy is much more important issue national security for the 2008 presidential election. AND, these percentages are WAAAAY up from November 2007, when they were only 35% (D) and 34% (R), and national security were deemed more important at 56%(D) and 59%(R).
• The Kaiser Family Foundation’s analysis of public opinion polls found a similar dramatic rise in voters’ interest in the economy as an issue for the 2008 campaign:

The key factors that I believe will determine the fate of health reform intiatives over the next several years are:

• How deep the economic downturn goes
• How long it lasts
• What actions the states and the Federal government take to preserve or dismantle the healthcare delivery, financing and public health systems
• When the economy rebounds, how well prepared the states and the Federal government are to pursue health reform initiatives, and what resources are available for these initiatives

The economic drain imposed by the ongoing conflicts in Iraq and Afghanistan, and the inflationary ripple rising energy costs are sending through the world economy are also factors that may very well undermine anyones ability to expand coverage, while at the same time, increasing incentives and efforts to control healthcare costs.

As Homer Simpson might paraphrase James Carville from the 1992 Presidential campaign, “It’s the Stupid Economy.”

The Institute of Medicine put out a report yesterday titled “Retooling for an Aging America: Building the Health Care Workforce.” The report discusses how the aging of the baby-boom generation will create greater needs for health care providers (of all types) who are trained in caring for the elderly with chronic conditions. The report’s recommendations fall into three categories: training, system transformation and financing. Like many reports about health system improvement, their recommendations all make sense - particularly within the context of the three categories. However, like many IOM reports, the writing by Committee process is a bit evident in that, (at least from the Executive Summary), it doesn’t seem to describe a complete plan, nor does it prioritize any of its recommendations - either in terms of funding or which actions should be done first.

In addition, while the report recognizes that the elderly in the coming decades will be healthier than those of 20 or 30 years ago, it doesn’t seem to fully address how this will change the healthcare services needed by the future elderly.

It seems to me, that one of the major challenges facing the healthcare system of the future is how to better manage chronic conditions - regardless of the patient’s age. Thus, rather than retrain clinicians (or train more caregivers) in geriatrics, there needs to be more across the board efforts in chronic care management and coordination among all levels of caregivers. This would benefit the growing elderly population - many, but not all of whom will have multiple chronic conditions - as well as the non-elderly with chronic diseases like diabetes, and the many neuromuscular degenerative diseases like MS or rheumatoid arthritis. This type of system-wide transformation seems like a better use of resources than segmental/specialized retraining and recruitment.

What are your thoughts?

Today’s Boston Globe has a lead article about the higher than expected costs for Massachusetts’ healthcare program implemented to create near universal insurance coverage. The costs of this program have been greater than expected due primarily to more people joining the subsidized health insurance program. (This greater than expected number has been attributed to underestimates of the actual number of uninsured in Massachusetts prior to the start of the Commonwealth Care program.)

The higher costs are certainly a problem for the state’s budget - although almost 50% of these costs may be paid for by the Federal government under the state’s Medicaid waiver. However, concerns about these cost overruns are in contrast to the Medicare Part D prescription drug benefit, which has been costing less than originally expected…… In part because fewer than the expected number of people have enrolled in Part D plans. Despite this, Medicare Part D has come under attack for it’s high costs - among other reasons.

The compare & contrast lesson here is that costs and access are like twin suns circling each other. One or the other can be dominant, but the two effect each other. Policy makers and pundits can praise or pummel each of these plans for their high costs or failure to cover more people, but the reality is more access will - at least initially - require additional spending. While cost containment can certainly be part of any acess expansion plan, it often requires reduced benefits or cutting reimbursements (or their growth rate) for specific clinicians, services or products, but these actions often have negative consequences down the road. Paraphrasing what the head of a national healthcare foundation stated a few months ago: “Lousy insurance can be provided inexpensively.” (And the inverse is true too - Inexpensive insurance can be lousy.)

What do you think?

The January 26th issue of The Economist had a short article about growing healthcare costs in the US. It pointed out (referencing CMS as a source), that healthcare costs had increased 6.7% from 2005-2006, but that Medicare spending had increased 18.7% What these numbers reflect, (but the Economist article only implies), is that because Medicare Part D started in 2006, spending growth shifted from private spending (and Medicaid) to Medicare. Looking at the actual data shows this to be the case:

• Public sector healthcare spending increased 8.2% in 2006 compared to 2005; Greater than the 7.1% the previous year
• Private sector healthcare spending o increased 5.4% in 2006 compared to 2005; Less than the 6.1% the previous year

Looking closer at the data is even more interesting. For 2006 compared to 2005:

• Medicare spending increased 18.7% compared to the prior year’s 9.3%
• Medicaid spending declined by 0.9% (the first decline in the history of the program) compared to a 7.3% increase the prior year
• Spending on private health insurance increased 5.5% (the slowest rate of growth since 1997) compared to 6.2% the prior year
• Out-of-pocket payments increased 3.8% compared to 5.2% the prior year

However, although total Medicare spending has increased, Part D spending has been tens of billions of dollars per year lower than originally projected.

What do you think this all mean for:

• Longer term spending within the US healthcare system?
• The political fighting over Part D?
• Changes to Part D’s structure (e.g. donut hole), and financing?
• Medicare’s contracting with managed care plans in Medicare Advantage (formerly Medicare+Choice)?