By MATTHEW HOLT

I was invited on the Health Tech Talk Show by Kat McDavitt and Lisa Bari and I kinda ranted (go to 37.16 here) about why we don’t have primary care, and where we should find the money to fix it. I finally got around to writing it up. It’s a rant but a rant with a point!

We’re spending way too much money on stuff that is the wrong thing.

30 years ago, I was taught that we were going to have universal health care reform. And then we were going to have capitated at-risk entities. then below that, you have all these tech enabled services, which are going to make all this stuff work and it’s all going to be great, right?  

Go back, read your Advisory Board Company reports from 1994. It says all this.

But (deep breath here) — partly as a consequence of Obamacare & partly as a consequence of inertia in the system, and a lot because most people in health care actually work in public utilities or semi-public utilities because half the money comes from the government — instead of that, what we’ve got is this whole series of massive predominantly non-profit organizations which have made a fortune in the last decades. And they’ve stuck it all in hedge funds and now a bunch of them literally run actual hedge funds.

Ascension runs a hedge fund. They’ve got, depending who you believe, somewhere between 18 billion and 40 billion in their hedge fund. But even teeny guys are at it. There’s a hospital system in New Jersey called RWJ Barnabas. It’s around a 20 hospital system, with about $6 billion in revenue, and more than $2.5 billion in investments. I went and looked at their 990 (the tax form non-profits have to file). In a system like that–not a big player in the national scheme–how many people would you guess make more than a million dollars a year?

They actually put it on their 990 and they hope no one reads it, and no one does. The answer is 28 people – and another 14 make more than $750K a year. I don’t know who the 28^th person is but they must be doing really important stuff to be paid a million dollars a year. Their executive compensation is more than the payroll of the Oakland A’s.

On the one hand, you have these organizations which are professing to be the health system serving the community, with their mission statements and all the worthy people on their boards, and on the other they literally paying millions to their management teams.

Go look at any one of these small regional hospital systems. The 990s are stuffed with people who, if they’re not making a million, they’re making $750,000. The CEOs are all making $2m up to $10 million in some cases more. But it also goes down a long way. It’s like the 1980s scene with Michael Douglas as Gordon Gecko in Wall Street criticizing all the 35 vice presidents in whatever that company was all making $200K a year.

Meanwhile, these are the same organizations that appear in the news frequently for setting debt collectors onto their incredibly poor patients who owe them thousands or sometimes just hundreds of dollars. In one case ProPublica dug up it was their own employees who owed them for hospital bills they couldn’t pay and their employer was docking their wages — from $12 an hour employees.

Now despite the ACA hoping to change American health care, these hospital systems make all their money not by doing primary care, but by running their high intensity services — cardiology, neurology, orthopedics, general surgery and all the rest of it. They recruit superstar surgeons who keep the cash tills running—even if they came from doing quasi-fraudulent care down the street. And they’ve spent the last decade growing.

I used to think – and this was the intent of the ACOs under the ACA –that this would be sorted out by capitation and value-based care, but it just hasn’t happened. Hospital systems spent the last couple of decades growing by buying primary care doctors, running their practices at a loss and capturing all their referrals for the expensive procedural stuff. In fact there’s a term for this—they call it preventing leakage.

I’ve been looking at this for a while, and then the real crowning thing that pissed me off, the cherry on top of the sundae if you will, was the answer as to why do they have all this money in reserves, or in their hedge funds? Why does a small health system have $2 billion plus sitting in the stock market or sitting in cash? You know why? Well, presumably it’s there for a rainy day, right? When something bad happens, they have money and they can sustain themselves, to run their mission.

Well we had a rainy day starting in March, 2020. Inpatient and elective care got shut down under Covid and they all started losing massive amounts. What happened? They said, now we need a bailout. That was a huge part of the CARES Act.

The only two organizations I respected at that time were for-profit chain HCA and Kaiser Permanente who were given bailout money but  gave it back because they said they didn’t need it. But many more were like Commonspirit with 140 hospitals across the country, which got $1.5 billion. Hundreds of millions went to hundreds of these individual systems.

I haven’t done this scientifically, but we know that in their “reserves” Ascension has got $40 billion, UPMC has got $12bn, Kaiser’s got a ton as well. A medium sized systems like that RWJBarnabas in New Jersey’s has $2.5 billion, and one in Minnesota called Essentia, which I’d never heard of until last week, has more than $600 million in its reserves. There is probably $250 to $350 billion sitting out there on the balance sheets of every non-profit hospital in America. And if you chuck in the health plans, it’s probably way more. There’s likely an Apple or Google size cash mountain sitting out there

If you started American health care from scratch what would you do? You would give everybody primary care. If you look at the people who actually have been moving the needle on controlling hypertension and managing diabetes, it’s all people with a primary care approach, who spend a lot more money on primary care than on later stage specialty care for the people who already are sick.

I heard a great talk from Bob Matthews who works with an inner-city medical group with a mostly low income African America population, helping them manage hypertension. The best at doing this in the state of California is of course Kaiser where 70% of people with hypertension are within official guidelines and are “under control”. The state average is below 40%. But with this tough population Matthews’ group was at 94%. We know how to do it properly, but we don’t spend any money on it.

So how much do we spend on FQHCs which are basically primary care for poor people. I asked ChatGPT and the answer is $38 billion.

If my guess is correct there’s $300 plus billion in these hospital reserves sitting there not doing anything other than buying Nvidia stock and yet it costs only $38 billion a year to run the FQHCs. You could add another $38 billion a year for probably ten years just by confiscating all the reserves and the hedge funds of the rich systems–which they don’t seem to be doing anything with!

I understand that this is America. You will see no finer example of regulatory capture than the AHA and every single hospital in every single congressional district making sure that there is no such thing as a real assault on their balance sheet. And if things go in the least wrong, you know, they have all these employees and they’re very important for the local economy and yada, yada. And changing that is unbelievably difficult in America.

Bu at some point it’ll have to change.

Bob Matthews, who I mentioned earlier, is from a company called MediSync, which supports a bunch of primary care groups. They essentially use intelligent machines, telling the doctors which drugs the people with hypertension should be on and how they should be treated, and help the primary care docs match the patients to the guidelines. If you actually do that, you have a much better chance of actually helping people avoid the problems of hypertension, diabetes et al. There’s a bunch of stuff you have to do. It requires proper patient outreach and yada, yada, yada. It’s not easy, but you can do it. And we have failed to do it because more than half the people in this country don’t have access to a primary care doctor.

I remember at Health 2.0 years ago I asked Marcus Osborn why Walmart got into health care delivery. He said that they surveyed Walmart shoppers, asking how many of them had a primary care doctor? And about 60% of them said they have one, 40% said they didn’t have one. Then they asked the 60% what the name of their primary care doctor was, and half of them didn’t know it. So not much of a relationship there! So at that point they said, hang on, perhaps we should be investing in primary care. And that’s why Walmart, Walgreens, CVS et al are now in the primary care business — because they think there’s an opportunity because the current incumbents have done it so poorly.

And why would the current incumbent big health systems bother to do what Bob Matthew’s groups did? Because all they’re interested in is getting the expensive people into their facilities to do expensive stuff to them in order to generate money, which then ends up in their hedge fund.

This is so screwed up.

We’re spending so much more than anybody else. We do need hospital systems. We do need intensive inpatient stuff. We need to figure out how to fix cancer. But we need to do less of it and we need to pay less for all the stuff we’re doing. We’re spending way too much, when we’re paying 10 times what everybody else in the world is paying for drugs. They call it the free market. But there isn’t one. There’s price fixing and price setting.

Every other country does price setting. And we do price fixing by the companies who make Ozempic and Humira, and stents and hospital beds and then of course by the systems that provide all these services.

We shouldn’t be putting up with this. And expecting a free market approach to get it right means that we’re relying on people who haven’t figured it out for years. Like employers.

Healthcare is a regulated market. Our primary payer is the fricking federal government, it’s not the free market. I’m trying to connect the fact we need to spend money in places it’s not being spent while there’s this obvious source of money sitting there being managed by hedge fund guys.

Literally, the former CEO of Ascension actually moved over to the hedge fund and is paying himself like $12 million bucks a year to manage the investment. I mean, good luck to him. No one’s stopping him. But at some point, we’ve got to say, why do we allow this?

Because technically half the money in hospitals comes from the government. At least 50% of their activity is a public utility. If RWJBarnabas was a pure government organization would there be 28 employees making a million bucks a year? I sincerely doubt it.

So let’s have a real evaluation of what money is available and lets take it from the organizations that shouldn’t have it and put it in the place where it’s needed.

Matthew Holt is the publisher of The Health Care Blog

BY MIKE MAGEE

“As I’ve said before, I believe Dr. Ladapo is an anti-science quack who doesn’t belong anywhere near our state’s Surgeon General office, let alone running it. But now that he’s been confirmed, it’s my sincere hope that he and Governor DeSantis choose to focus on saving lives and preventing unnecessary illness instead of continuing their absurd promotion of conspiracy theories and opposition to proven public health measures — but I’m not going to hold my breath.”

If you identified these as the words of the former governor, and now Congressman Charlie Crisp, currently running to retake the office he once held, you’d be wrong. These are the words of another state Democrat who is running a distant 2nd in the Democratic primary battle set for this summer.

Her name is Nikki Fried, Florida’s Agricultural Commissioner, and the only Democrat in his Cabinet. This is not the first time she’s tangled with DeSantis over Joseph Ladapo. She vigorously opposed his nomination in October, 2021, citing among other deficits promoting Covid misinformation, discriminating against Black farmers, and refusing to wear a mask at the request of State Senator Tina Policy who was undergoing chemotherapy for breast cancer.

By all accounts, the health department that Dr. Ladapo is supposed to be surgeon generaling is a mess. An investigative report in this week’s Tampa Bay News, found that in the past seven months as Covid variant cases topped 80,000 per week in the state, public health officials failed to report back positive tests to nearly a quarter of those infected, and failed to include 3,000 cases of COVID-19 deaths in the states mortality stats. During this same period, Ladapo, who earned his reputation for incompetence as a Trump sycophant, recommended that the state’s health departments cease all COVID contact tracing.

It would be comforting to imagine that politically motivated medical malfeasance is restricted to this one state, but a comprehensive article published this week in the BMJ, tracking U.S. health data from 2001 to 2019, finds that politics does indeed affect your health.

In a prior study published in JAMA the authors had established that there was a growing gap in morbidity and mortality between rural and urban areas in the U.S. As a follow-up, the lead author decided to explore whether county level political leadership affiliation positively correlated with poor medical outcomes.

In an article this week, the author, Haider J. Warraich, an assistant professor at Harvard Medical School, stated, “Regardless of whether we looked at urban or rural areas, people living in areas with Republican political preferences were more likely to die prematurely than those in areas with Democratic political preferences. There was no single cause of death driving this lethal wedge: The death rate due to all 10 of the most common causes of death has widened between Republican and Democratic areas… Based on statistical testing, the gap in mortality appeared to particularly widen after 2008, which corresponds to the passage of the Affordable Care Act in 2010, a major part of which was Medicaid expansion.”

As expected, the poorest performing areas coincided with those under the control of Republican governors who refused to accept federally subsidized expansion of Medicaid services for their citizens.

While DeSantis and his fellow governors fan the flames of “replacement theory” and gratefully accept the unwavering support of the Trump base, they may want to focus on this surprise finding in the BMJ data – The “fourfold growth in the gap in death rates between white residents of Democratic and Republican areas seems to be driving most of the overall expanding chasm between Democratic and Republican areas.”

In 2005, I gave a speech at the Library of Congress that caused a stir. Its title was “Health is Political.” Dr. Warraich’s work adds concrete data in support of the argument. As he recently wrote, “In an ideal world, public health would be independent of politics. Yet recent events in the U.S., such as the Supreme Court’s impending repeal of Roe v. Wade, the spike in gun violence across the country, and the stark partisan divide on the response to the Covid-19 pandemic, are putting public health on a collision course with politics. Although this may seem like a new phenomenon, American politics has been creating a deep fissure in the health of Americans over the past two decades.”

Mike Magee M.D. is a Medical Historian and the author of “CODE BLUE: Inside the Medical-Industrial Complex.”

I went for an annual physical with my doctor at One Medical in December. OK it wasn’t actually annual as the last time I went was 2 & 1/2 years ago, but it was covered under the ACA, and my doc Andrew Diamond was bugging me because I’m old & fat. So in I went.

I had a general exam and great chat for about 45 minutes. Then I had blood work & labs (cholesterol, A1C, etc) and a TDAP vaccination as it had been more than 10 years since I’d had one.

Today, about one month later, I got an email asking me to pay One Medical. So being a difficult human, I thought I would go through the process and see how much a consumer can be expected to understand about what they should pay.

Here’s the email from One Medical saying, “you owe us money.”

When I clicked the “Make a Payment” button, I got this screen

It told me I owe $7 and change, and asked for my credit card. Why? Who knows?

So I clicked the “Account details” button in the corner –assuming that it would ask me to log in to One Medical’s site. But instead it sent me to a screen asking me to send myself a code. Although it did it in a messy way, saying “null null”

When I clicked on “null null” it did show me my phone number and enabled me to select it and to send myself a code. Why that step was needed I’m not sure. Security? To stop someone else paying my bill that they already showed me?

It now sends me to the actual page on a site called “Patientops” which has the details. Now it gets interesting. Or maybe not….

It showed me that I got charged for a blood draw (I know that because I can google what a Venipuncture is!). One Medical charged $15 and I owe $7.49.

But what about the billing for all those other aspects of the visit? You’d never know from One Medical’s site but of course I can go to my insurer, which happens to be Blue Cross Blue Shield of Massachusetts.

After a bit of navigation I find the claim for my appointment at One Medical. Here’s the summary

And here’s the breakdown by services.

It tells me that One Medical billed $975 and BCBS Mass nicely agreed to pay them $781 — which ain’t much of a markdown! And it does tell me that there were 4 different medical services. But there’s no way for me to know which was what. So much for online transparency

But wait. With a little bit of attention and hunting around the site, I can also download the EOB. You know, the multi page impenetrable document that health insurers send out that says THIS IS NOT A BILL on it. So I did that.

Below is a snip from the 6 page PDF of the EOB.

Just to confuse you further it tells me that BCBS Mass allowed $882 out of a total billed of $1,365 –and yes I owe $108 against my deductible which presumably was for services not mandated as preventive care under the ACA. (More on that to come). Given One Medical only billed them $975, I’m wondering where the $390 came from?

For that you need to go another 3 pages deep into the PDF of the EOB, and then you finally get some information. Yes, BCBS Mass has bundled all my health expenses for December together, including the labs generated in the visit to One Medical and a completely separate visit to my chiropractor. (My chiropractor is the most excellent Taylor Rabbetz who I highly recommend if you are in search of one in San Francisco and whose office is incidentally the next block over from One Medical’s in the Embarcadero).

Here you can see the details of all the parts of the visits.

One Medical charged $660 for the office visit for which BCBCS Mass paid $530. (Don’t worry Andrew Diamond is well worth it, but they’re still paying him a pretty decent hourly rate!). My Tdap vaccine was billed at $160 and BCBS Mass paid $153–which seems quite a lot given Goodrx will get it to you for around $55 at a pharmacy! There were “Other Medical Services” billed at $140 for which BCBS Mass paid $90 — I have no idea what those were, and there was no CPT code given so I have no way to figure it out. Finally that blood draw for the lab test was $15, for which BCBS Mass got a discount of $7.51, leaving me with a bill of $7.49. I guess lab tests and draws don’t count under “preventative care” while immunizations do. Hence that’s the $7.49 which started me off on this whole quest.

But wait there’s more. The poor chiropractor billed $120 and got a measly $57 for his efforts (which of course I paid, as it was under the deductible). Somehow BCBS is discounting that at 50% while One Medical is getting 90% of its billing. So my chiro has to see 10 times the number of patients in an hour that One Medical’s PCPs do to bring in the same amount of cash.

Then there’s the lab tests themselves–also apparently not covered under the ACA even though they are arguably the most important part of “preventative” care. I haven’t got the bill from Labcorp but now I know what is coming. Their bill was somehow broken up into 4 different tests. Again I can’t tell which was which, but I actually had CBC, lipid, A1C, uric acid and also Fecal Occult Blood (although that was a take home test which I delivered later so may not have been on this bill). But the most amazing part was that they billed $270 and only got $43. So while One Medical got about 90% of its demands and the chiro got 50%, the poor teeny lab corporation (OK, not teeny) only got about 15%. And yes I’ll have to pay them their $43 when they get round to billing me.

Which all leads me to a few conclusions:

1. Six years after Health 2.0 & Mad*Pow ran a challenge with ONC, AARP & RWJF called A Bill You Can Understand there is still no such thing for most of us. I mean other than a nerdy curmudgeon like me, who the hell is going to go through all the trouble I just did? And even so there’s no information like CPT codes to really track down what happened.
   
2. There seems to be no relationship between time spent or services delivered and payment. Yes my chiro spent 15 mins with me and my PCP 45 but what’s the logic in a 10 fold difference in payment?
   
3. There’s also no relationship between “charge” and “payment” — I mean that’s been known for decades. But still, why is One Medical getting 90% of charges and LabCorp only getting 15%?
   
4. There seems little logic about what is actually paid for as preventative care as mandated by the ACA. Here’s the official list of what is covered. It includes cholesterol screening yet BCBS Mass thinks I owe for that, and I also pay for the blood draw–tough to imagine getting my LDL et al checked without one! (Sorry, Elizabeth Holmes!). I should also get free diabetes screening, yet I am being charged for the A1c test. The immunization, though, is on the list and yes that was paid for in full.

The only way out of this would seem to be a uniform fee schedule. And my guess is that we’re not getting that any time soon. But otherwise the consumer has basically no chance figuring this all out. Remember this not so simple billing experience was for a routine check up! Heaven knows what it’s like for patients with complex conditions!

Oh yes, I’m off to pay One Medical their $7.49 whether or not I really owe it. Given their recent stock price, they might need it!

By  JEFF GOLDSMITH

The Trump administration’s health care journey began with a trillion dollar near miss–the failed Repeal and Replacement of ObamaCare- and ended with a full-on train wreck, the catastrophically mismanaged COVID epidemic that will have claimed 300,000 lives by the time he leaves office. After four years of posturing and lethal incompetence, it will be a relief to see caring and professionalism return to the White House health policy under President-Elect Joe Biden.   

Like Inheriting a Badly Managed World War

Like Barack Obama, Joe Biden will be saddled at the beginning of his regime with a damaged national economy. He will also walk in the door to the immediate need to manage the greatest public health catastrophe in a century as well as its economic consequences–a deep and enduring recession. Biden will be inheriting the equivalent of a badly managed World War we are presently losing.

Public health professionals who were marginalized by Trump will be challenged not only to craft coherent policy to contain and extinguish COVID  but also to sell it to a frightened and polarized general public, many of whom reject the need for basic public safety measures.    

Controlling COVID and rebuilding the critical public health agencies–CDC and FDA–that have damaged by political meddling will consume the lion’s share of the administration’s health policy bandwidth in its first year. It will be pressed to address a huge readiness gap–from critical PPE supplies to the development and deployment of testing and tracing capability to public health co-ordination and messaging–for the next pandemic. Increasing the presently inadequate level of public health funding (less than $100 billion a year in a $21 trillion economy) seems inevitable.

The inability of Congress to produce a fall round of COVID relief will create pressure on Biden to take immediate action to help struggling sectors of the economy, like airlines, restaurants and hospitals, as well as further help for the long term unemployed. Only a little more than half of the 22 million jobs lost in the spring have returned by November. Twenty million Americans were stranded by the July expiration of supplemental unemployment benefits as well as countless millions more “free agents” and contractors not eligible for traditional unemployment that are losing coverage at the end of the year. Mortgage, credit card and consumer loan forbearance are ending, and unless Congress acts, acres of rotten credit will turn rapidly into a banking and bond market crisis which the Federal Reserve cannot fix by itself.   

State governments face FY21 deficits equaling $500 billion over the next two years , against a current annual spending base of about $900 billion.  Further assistance to state and local governments will almost certainly include an additional increase in the federal match for Medicaid (FMAP), beyond the 6.2% temporary increase passed in March). Medicaid enrollment will likely top 80 million by mid 2021, almost one-quarter of the US population. Some states will have upwards of 40% of their population on Medicaid by mid-2021.

States laboring under severe revenue shortfalls will be unable to afford the expanded Medicaid program that was part of ObamaCare without a further increase in the FMAP rate.  President Trump and Senate Republicans blamed the state and local government fiscal crisis on profligate Democratic mismanagement, and blocked aid to them during 2020. But Texas, Florida, Georgia and other red states have the same problems New York and California do. 

Serious Fiscal Limitations Push the Health Policy Agenda Away from Coverage Expansion

Barack Obama entered office with a FY08 federal deficit of $420 billion. Joe Biden enters with a FY20 deficit of $3.1 trillion and a baseline FY21 deficit of $1.8 trillion, before adding the cost of the likely additional trillion dollar-plus stimulus package early next year. It will be passed over the dead bodies of Republican Congressional leadership suddenly recommitted to deficit reduction after racking up $8 trillion in deficit spending during the four years they controlled the federal government.

Coverage Expansion via Medicare and Public Option Unlikely

That deficit will significantly constrain a further expansion of health coverage. Not only will “Medicare for All” be off the table. Severe fiscal pressures will cause the new administration to “slow walk” a public option (which would require federal subsidies to implement) and Medicare expansion to people over age 60. These expansions were going to be  controversial and politically costly because they would be fiercely contested by hospitals and other care providers concerned about the erosion of their commercial insured customer base (the source of perhaps 130% of their bottom lines) as well as the use of Medicare as a de facto price control lever. 

By the time Biden addresses the first two problems–COVID and the economic crisis–he will probably have expended his limited stock of political capital and be weakened enough to be unable to take on the large messy issues of health coverage expansion and cost control. The Affordable Care Act exhausted Obama’s store of political capital, by early 2010. His administration’s failure to turn the economy cost the Democrats control of the House of Representatives and 20 (!) state legislatures in 2010.

What Can Biden Do in Health that Does Not Require Federal Spending?

Thus, the focus of Biden health policy is likely to be on items not requiring fresh spending.

Two major candidates for Biden policy activism: facilitating unionization of health care workers and antitrust enforcement. Labor unions were major Democratic supporters in this election cycle. Moreover, they were extremely active this spring and summer as advocates for the safety of health workers. They ran a very effective orchestrated press campaign to pressure large health systems such as HCA and Providence Health. Union leaders were prominent in health policy working groups for the Biden campaign after the conclusion of the primary season. Aggressively pro-union appointments to the National Labor Relations Board and legislation to facilitate union elections are almost certain to be early Biden initiatives.

Antitrust action to slow down or unwind hospital and health insurance mergers are also likely. The California Attorney General Xavier Becerra’s settlement of his aggressive anti-trust action against Sutter Health not only resulted in a huge financial payment (useful for reducing California’s budget deficit) but also forbade Sutter from “all or nothing” rate negotiations with health insurers. Spreading this approach nationally would significantly damage the financial position of large multi-hospital systems and complicate the forthcoming rate negotiation cycle with health insurers.  

It is also likely that the Biden administration will continue the push begun during Trump for price transparency and disclosure of patient financial responsibility prior to service, further complicating rate negotiations with health insurers. Resolution of the deadlock over surprise billing is also likely.

Finally, Biden is likely to attack the 5% margins generated by Medicare Advantage carriers who now control 37% of all Medicare lives, and are getting a 50% share of each year’s worth of baby boomers enrolling in the program. Only half of boomers are yet enrolled in Medicare, and cutting Medicare Advantage cap rates will be a juicy target for Biden’s OMB in attempting to control the exploding federal deficit. Cutting health insurer profits is not the same as “cutting Medicare”.

Health care’s corporate sector is presently basking in record valuations and a largely favorable regulatory climate from the outgoing Trump administration, even as the care system has reeled from COVID.  Financial pressures from the COVID health economy and continued slack demand for care will certainly challenge the care system, as it faces renewed regulatory and political pressures from the new administration. 

Jeff Goldsmith is the President of Health Futures, Inc

Episode 30 of “The THCB Gang” was live-streamed on Thursday, October 29th! Watch it below!

Matthew Holt (@boltyboy) was joined by some regulars and this episode was a spooky be a COSTUME PARTY! On this episode were data privacy expert Deven McGraw (@healthprivacy), writer Kim Bellard (@kimbbellard), health economist Jane Sarasohn-Kahn (@healthythinker), CTO of Carium Health Lygeia Ricciardi (@Lygeia), MD & hospital system exec Rajesh Aggarwal (@docaggarwal), policy & tech expert Vince Kuraitis (@VinceKuraitis), and me, THCB’s Editor-in-Chief (@zoykskhan). The conversation had a more spooked tone to it as many of us are worried about the safe transition of power, the safety of voters, the misinformation about herd-immunity, the rising COVID-19 cases, and everything happening in the Senate. What will the results of November 3rd bring for this country?

If you’d rather listen to the episode, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels — Zoya Khan, producer

Cautionary tales are timeless. Take for example Aesop’s Fables, from 620 BC, which included the advisory, “Be careful what you wish for lest it come true.”

Trump and the Republicans who oppose the ACA take heed. You may be inadvertently taking the entire collusive Medical-Industrial Complex down a rabbit hole.

In the opening salvo to the Amy Coney Barrett hearings, House Speaker Nancy Pelosi seemed to be anxious for the fight.  Her view of Trump’s strategy? “The president is rushing to make some kind of a decision because … Nov. 10 is when the arguments begin on the Affordable Care Act…He doesn’t want to crush the virus. He wants to crush the Affordable Care Act.”

With no health plan replacement on the shelf, death star Republicans have been struggling to bury this ever more popular piece of legislation for ten years.

In the process, they’ve alienated not only those who believe health care is a right rather than a privilege, and those who support protections for pre-existing conditions, but also those against deceptive skimpy health insurance, those who believe transgender Americans deserve care guarantees, those who demand access to affordable drugs, those who have their under age 26 adult children covered on their family plan, those opposed to cuts in coverage of contraceptives, and those in favor of federal funding of Planned Parenthood clinics.

As Kaiser Health News Washington correspondent, Julie Rovner, recently wrote, “With the death of Ruth Bader Ginsburg, the ACA’s future is in doubt.” In a case now known as California v. Texas, set for presentation to the Supreme Court in just a few weeks, 21 attorneys general (AGs) led by California are seeking clarity on a challenge by Texas led Republican AGs to declare the ACA unconstitutional based on a weak technicality.

Experts like University of Michigan law professor Nicholas Bagley have sounded the alarm that Barrett’s confirmation could mean the deciding swing vote on the case. He writes, “Among other things, the Affordable Care Act now dangles by a thread.”

But charter members of the Medical-Industrial Complex (MIC) aren’t lining up with Mitch McConnell. America’s Health Insurance Plan (AHIP), the lobbying arm for the big insurance companies, says a Trump win here would cast “a long shadow of uncertainty over ACA-based investments and denies health insurance providers, states, individuals, and other stakeholders of much needed clarity.”

The AARP, with its own proprietary Part D pharmaceutical plan, says a bad decision here “plunges millions of Americans into an abyss of prolonged uncertainty because they do not know if they will lose access to life-sustaining health care coverage and consumer protections.”

The American Hospital Association, the Catholic Health Association of the United States, and the Association of American Medical Colleges issued a joint warning that a Trump/McConnell victory here could  “have serious, perhaps irreparable, consequences for hospitals and the patients they serve.”

Why would charter members of the MIC be spurred to such progressive, public-spirited action against their very own free-market allies, you might ask.

The answer lies in the “What if?” What if Republicans actions in the Supreme Court on November 10th succeed in throwing American health care into full-throttled chaos in the middle of a pandemic now slated to result in 400,000 plus American casualties by February, 2021…and Joe Biden wins control of the executive and legislative branches of government?

Here are two possible scenarios:

1.Biden rolls back the Trump regulatory actions thus far enacted, and the Democratic Congress reinstates the ACA mandate (the technicality that led to the claims of unconstitutionality of the ACA) thus negating the effects of the negative Supreme Court decision. Medicaid extensions in the 12 remaining purple (formerly red) states proceed. At the same time Biden approves extended eligibility to enroll in a voluntary public option.

2. Biden takes a good hard look at the ACA, and at the Republican led legal challenges that will continue unabated with tacit support for the MIC status quo – and says, “Screw it. I’m going Medicare for All.”

Mike Magee MD is a Medical Historian and Journalist at the University of Hartford. He is the author of Code Blue: Inside the Medical Industrial Complex. ((Grove Atlantic/2019)

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The new Supreme Court, in all likelihood including just nominated Justice Amy Coney Barrett, will be hearing the California v Texas suit against the ACA on November 10th, seven days after the election. The lower courts have already ruled the ACA unconstitutional. Some hopeful moderates among my Democratic friends seem to believe that the justices will show cool heads, and not throw out the ACA. But it’s worth remembering that in the NFIB vs. Sebelius decision which confirmed the legitimacy of most of the ACA back in 2011 all the conservative justices with the exception of John Roberts voted to overturn the whole thing. With Ginsburg being replaced by Barrett there’s no reason to suppose that she won’t join Thomas, Alito, Kavanagh & Gorsuch and that Robert’s vote won’t be enough to stop them this time. The betting odds must be that the whole of the ACA will be overturned.

There is nothing the Democrats can realistically do to prevent Barrett filling RBG’s seat on the court, but assuming Biden wins and the Democrats take back the Senate, the incoming Administration can give the Supremes something to think about regarding the ACA. I would not suggest this level of confrontation before the election but, if Biden wins, the gloves must come off.

Assuming he wins and that the Dems win the Senate, this is the speech Biden should give on November 9th. (The TL:DR spoiler is, “Keep the ACA or I’ll extend Medicare to all ages”)

“I’m directing this speech to an extremely select number of people, just the Supreme Court Justices appointed by Republican Presidents. It is obviously no secret that we have political differences on many issues and we find ourselves in the strange situation in which I am the incoming President with an incoming Democratic Senate majority and yet you are considering overturning the signature bill of the administration in which I was Vice-President. You may recall that at the time of its signing I told President Obama that it was a “big f****** deal”  and, although many of my colleagues in the more progressive wing of the Democratic Party have criticized the ACA since its passage, it turns out that I was right. 

I am not referring here to the apoplexy that the ACA created amongst the Republican Party including not only the current and outgoing President but also almost all Republican members of Congress between 2010 and 2018. Instead I’m referring to the ACA’s impact on the nation and its health care system. 

Since 2010 there have been many changes to the way our nation’s health care system operates; almost all of them have their roots in the ACA. 

First, the ACA gave access to health insurance coverage to many people who had great trouble getting it before. That includes young people moving between their parent’s home, college and getting into the workforce; small business owners; freelance workers; the unemployed; people with low incomes; and people with underlying “pre-existing” health conditions. I remind you that due both to the pandemic and changes in our economy, there are many, many more of these people now than there were in 2009. 

Before the ACA these people were either not well served by the private health insurance industry or literally were unable to buy coverage at all. This not only caused extreme personal and financial suffering and in some cases death to the people affected, but also impacted the economy. It restrained innovation and entrepreneurship, and it meant that the participants in the health care system–including very many well meaning clinicians and provider organizations–had to play very inefficient games in order to try to provide those people with much-needed care, which drove up the cost of care to everyone else. Warren Buffet calls that the tapeworm in the US economy.

The ACA changed this in two main ways.

First it created a system of standardized insurance benefits and mandated insurers to provide those benefits to anybody regardless of health status. It also directly subsidized the cost of insurance for people of low to moderate-incomes. Given that median household income is around $63,000 in the US and the current cost of family insurance is around $28,000, these subsidies are essential. Otherwise people who do not have employment-based insurance would not be able to purchase coverage.

Second, the ACA expanded Medicaid coverage for the poor, creating a standardized set of benefits for those earning up to 133% of poverty. Sadly, the conservative majority on the court, joined (in my view to their everlasting shame) by Justices Breyer and Kagan, decided that the federal government did not have the right to force states to expand Medicaid even though the federal government paid 100% of the cost. It turned out that many states with Republican governors chose not to expand Medicaid, even though this meant that many rural hospitals in their states were forced to close. Numerous studies have shown that Medicaid expansion has improved the financial and emotional health of the poor, and other work has shown that the current Administration’s policy of allowing states to restrict access to Medicaid, by using such tricks as work requirements, have been cruel and counterproductive–and that they have not reduced health care costs or increased employment. States that have not expanded Medicaid have left their most vulnerable and poor populations in an extremely difficult state. For example in Texas a single parent with two  children is only eligible for Medicaid if the children are on Medicaid and total household income doesn’t exceed $230 a month, which would barely cover your clerks’ daily lunch bill. Some estimates suggest that nearly three-quarters of a million people in Texas are in the coverage gap between Medicaid and qualifying for the ACA.

However, the ACA was not just about expanding insurance for those who had trouble getting it before. It also closed several loopholes that had confronted many other people who needed to use the health care system. This included closing the donut hole in the drug coverage for seniors provided by the Medicare Modernization Act in 2003. It also did away with maximum coverage benefits which severely compromised the care received by extremely sick people–often children or those with very rare diseases. And, in a great benefit to many, many young Americans from middle class and even wealthy families, the ACA allowed parents to keep their children on their insurance up until the age of 26, when they were usually established in the workforce.

Many of you on the Supreme Court believe that private delivery of insurance and health care services are superior to those delivered by the government. For you the ACA should indeed have been a very welcome piece of legislation. All of the new enrollment coming through the ACA exchanges went through private health insurance companies, and the vast majority of Medicaid expansion is also managed by private health insurers. While federal tax dollars are subsidizing this coverage expansion, it’s worth pointing out that a IRS decision in 1954 confirmed the tax-free status of private health insurance premiums paid by employers which translates to an annual subsidy to private employers that exceeds the cost of the premium subsidies in the ACA. On the night that the ACA was passed a Canadian journalist reported that America had just seen the largest expansion of private health care coverage ever–and he was right.

This coverage expansion was by no means all that the ACA did. It was also the legal and regulatory basis for a substantial modernization of the nation’s health care system. Of course since the 1930s, US health care has largely been based on a fee-for-service payment approach, acknowledged by experts to be both inefficient and inflationary. The ACA created the Center for Medicare and Medicaid Innovation which has been at the forefront of creating programs that encourage improved care at a lower cost by, for instance, bundling payments for joint surgery, cancer and other care. It also created the system of accountable care organizations which encourages doctors and hospitals to work together to more efficiently and effectively manage the health of large populations of Medicare recipients. And while the ACA did not create the Medicare Advantage program, it put in place an environment in which private health insurance companies were able to use government funding within the Medicare program to deliver innovative programs that are improving the quality of care received by our seniors. 

In addition, since the passage of the ACA, and assisted by it and the HITECH Act passed in 2009, there has been a considerable boom in the development of new types of health care technologies, particularly digital technologies. These show amazing promise for delivering 24/7 care to many vulnerable populations. The significant spread of telehealth and remote patient monitoring during the current COVID-19 pandemic was only possible because of the innovation of numerous private companies. They developed those technologies in large part in response to incentives created by the ACA.

Finally, although the cost of health care in the United States is still significantly higher than it is in other countries, since the passage of the Affordable Care Act the rate of increase of health care cost has slowed and up until this year the health care system was barely growing as a share of the overall economy for the first time ever (other than a brief blip in the mid 1990s).

This is just a brief overview of the impact of the Affordable Care Act. It has directly meant access to health care coverage for around 20 to 30 million people and, as health futurist Ian Morrison points out, has tentacles impacting every single part of the health care system. This was not the case when four conservative justices including two currently on the bench (Alito & Thomas) voted to throw out the ACA in 2012. And it has not escaped my attention that the two justices who have replaced Scalia and Kennedy appear to have similar or perhaps even more conservative viewpoints.

If following the arguments you will hear this week, the Supreme Court decides to uphold the lower court hearing and abolish the entire ACA on what is pretty much a technicality, the consequences will be dramatic. And they will be very bad.  

Tens of millions of people will lose their health insurance. Of course they will still require care. The cost of delivering that care will fall upon the nation’s health care providers, and eventually on the taxpayer. That cost will be distributed in an unplanned and chaotic manner –resulting in much actual and financial pain.

In addition, virtually every current organization funding, delivering or involved in care delivery will have to completely reformat the business operations it has spent the last decade putting in place. American health care will be thrown into chaos and the cost in both dollars and human suffering will be extreme. 

Given the extreme impact of throwing out the ACA,  I will appeal to all the justices to maintain the ACA in place.

Unlike the outgoing president, I respect the institutions and separation of powers inherent in the constitution of our nation. But given that I and my colleagues in the Senate have just been elected by a significant majority of Americans, and also given that none of the conservative justices on the court were appointed by a President who won the majority of the vote of his fellow citizens when initially elected, I would recommend that the court consider its actions very carefully. Unlike some in my party, I am not advocating significant constitutional changes such as appointing more justices, but the more the court bends against the arc of history, the more likely it is that such actions may be taken in the future.

However, in regards to the nation’s health care system I am hereby telling you exactly what I will do–should the court return a verdict overturning the ACA.

You are well aware that in the Democratic primary campaign, which was largely settled before the covid-19 pandemic had its full effect, my opponent Senator Sanders was campaigning to create Medicare for All. While I was and am opposed to this policy, it is clear that a significant majority of Democrats and in some polling a majority of Americans were in favor of expanding Medicare For All even before the full effect of the pandemic was realized. 

The world of course is radically different now compared to how things were even at the start of 2020. Not only has our health care system had to deal with the onslaught of the pandemic, but the recession that it caused has placed many more millions of Americans out of work, and some 5 million of those have already lost their health insurance. I pledged in the election campaign both to get the economy moving and also to support those who were victims of the recession, which includes those millions who lost their health insurance. 

In my campaign I pledged to build on the successes of the ACA. As you are well aware, two of the most significant policies I proposed were to create a public option and to reduce the eligibility age for Medicare to 60 years old. If the Supreme Court throws out the ACA, it will be by definition impossible for me to build on the ACA’s infrastructure.

But at a time of a pandemic during a recession I will not stand by and allow tens of millions of Americans to suffer. 

Instead let me tell you what I will do. 

As you know under the current rules of the Senate and from the convoluted passage of the ACA itself, it is virtually impossible to pass significant legislation without 60 votes. In the election that just happened we Democrats have retaken control of the Senate, but only with a slight majority. However, as you also know, the Senate can pass legislation impacting budgets under the process of reconciliation with a simple majority. You will recall that using reconciliation the Republican majority in the Senate tried to repeal the ACA in 2017, and were only prevented from doing so by the deciding vote of my friend the late Senator John McCain.

On the day which I hope never comes that the Supreme Court invalidates the ACA, my colleagues in the House and Senate will immediately introduce legislation amending Title 18 of the 1965 Social Security Act that created Medicare to reduce the age of eligibility not to 60 but to zero. At the same time we will amend title 19 of the 1965 Social Security Act that created Medicaid to reduce its budget to $0 other than to pay the premiums into Medicare for those known as “dual eligibles” and to pay for long term care and other services that Medicare currently doesn’t cover.

You and other conservatives might believe that we will not be able to complete this because of the Byrd Rule for reconciliation which was designed in the 1980s to ensure that reconciliation did not radically change the budget of the federal government. But the Senate Republican majority in the Congress before last essentially already violated these rules by passing a scandalously unfair and unfunded tax cut, and my colleagues in the Senate will be prepared to override the Byrd Rule. This, I point out, is significantly less controversial than overriding the filibuster or changing the number of justices on the Supreme Court.

Conservatives might also believe that Medicare expansion would significantly increase the budget of the federal government. This would be true but is ignoring two salient facts. The first is that the expansion to the federal budget would be something of the order of 2 trillion dollars a year, as the federal government already spends roughly 1.5 trillion of the 3.5 trillion the United States spends on health care. That level of expansion of government is somewhat similar to the deficit spending which just happened under the CARES act and other stimulus money spent during the current pandemic. So it’s not that large a leap for the country to make.

In addition while the expansion of Medicare under reconciliation would not directly abolish private health insurance in the manner that my colleague Senator Sanders has proposed, the fact that Medicare part A is free to Medicare recipients, and that parts B & D are very heavily subsidized, will mean that it is not only those who have lost their insurance or have trouble buying it in the individual market, or those who were previously on Medicaid, who will voluntarily enter the Medicare program. It is extremely likely that the vast majority of employers who are currently providing health insurance for their employees, which to be noted would be voluntary if there is no ACA, will cease to do that. After all their employees could now enter the Medicare program at no extra cost to them. While this will cost the government more, it will save employers and individuals an approximately equal amount and so the net effect on the economy will be limited.

Part of the reason that I am not a proponent of Medicare for all, has been that the change it would cause to employer-based health insurance, and to the finances of our nation’s health care system would be too extreme. It is worth noting that Rand  recently showed that employer-based health insurance paid hospitals and doctors at nearly 250% the rate they receive from Medicare. There will certainly be high transition costs for the health care system from this move but everyone in the health care system already understands how Medicare works. My Administration will to work with providers and care delivery organizations to make sure that they are able to fulfill their mission of providing high-quality care to Americans.

Even though I have been a political centrist my entire life and have never been a proponent of Medicare For All–despite the fact that every other industrialized nation has something pretty similar to it–if you strike down the ACA I will act immediately. I would view the suffering of Americans as being too great not to respond. With no ACA in place there is no available legislative option other than this Medicare expansion.

I am well aware of the ideology of many on the political right in the US including most of the conservative justices on the Supreme Court. I would stress that this type of radical expansion of Medicare is not what I would ordinarily want to see. But if the ACA is abolished in the middle of a pandemic and a massive depression, my first duty to the American people as their President will be to relieve the suffering of as many of them as possible.

As you consider your judgement in the California v Texas case I would ask you not to put me in the position where I would have to take such a radical step.  

But I assure you that if necessary I will have no hesitation in doing so.

Matthew Holt is the publisher of THCB. He has not written a speech for Joe Biden before but would happily lend him this one

Episode 26 of “The THCB Gang” was live-streamed on Thursday, September 24th! Watch it below!

Joining Matthew Holt (@boltyboy) were some of our regulars: health futurist Ian Morrison (@seccurve), patient advocate Grace Cordovano (@GraceCordovano), patient & entrepreneur Robin Farmanfarmaian (@Robinff3), health care consultant Daniel O’Neill (@dp_oneill), and patient safety expert Michael Millenson (@MLMillenson). The conversation revolved around the dismantling of the ACA, conservatives causing chaos in the government, the dismissal of pre-existing conditions, and the state of women’s health rights after the passing of RBG. It was both an emotional & impactful conversation.

If you’d rather listen to the episode, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels — Zoya Khan

Episode 17 of “The THCB Gang” was live-streamed on Thursday, July 9th! Watch it below!

Joining me were some of our regulars: patient advocate Grace Cordovano (@GraceCordovano), health economist Jane Sarasohn-Kahn (@healthythinker), WTF Health Host Jessica DaMassa (@jessdamassa), and guests: Tina Park, partner at Diagram (@diagramoffice) & Shannon Brownlee, Senior VP at the Lown Institute (@ShannonBrownlee). The conversation focused on asynchronous care, the gap between patients & technology, and the Supreme Court ruling on employers’ ability to limit women’s access to birth control coverage. It was a great and engaging conversation with some of the top health care experts in the field.

If you’d rather listen, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels — Zoya Khan