We enter into the 2020 election with very different views between Republicans and Democrats (and even within the Democratic party) as to how to solve our health-care challenges. Unfortunately, the national discussion is misguided. Despite the fact that health care is the number one issue for voters and their concern is how to pay for it, Republicans have focused their efforts on eliminating or crippling the ACA, and Democrats have focused on how to provide more coverage and what benefits should be included. There could not be a wider disconnect between the voters and their elected officials, and neither party has a plausible solution to our health-care spending problem.
The National Health Care Debate and the Trojan Horse
Why is the national discussion misguided?
First, the debate centers around two issues – who should be covered (ACA, Medicare for all, guaranteed issue, etc.) and what benefits should be covered (short-term health plans that don’t cover all the essential health benefits, Medicare for all with dental, vision, and long-term care coverage, etc.).
These are not unimportant issues, but none of these ideas will solve the spending issue.
Second, these matters are not even what is important to voters. Survey after survey shows that Americans are primarily concerned about the cost of their medical care, not who is covered and what benefits are covered.
Here’s the real problem. The Centers for Disease Control and Prevention (CDC) has determined that 75 percent of health-care spending goes to treating and managing chronic diseases. According to the CDC, the 10 most expensive chronic diseases contributing to U.S. health-care spending are:
- Cardiovascular diseases
- Smoking-related health issues
- Alcohol-related health issues
- Alzheimer’s disease
Many of these conditions are preventable or avoidable, but I am alarmed by the growing prevalence of many of these diseases and risk factors and the development of many of these conditions at a younger age.
Let’s take a few examples.
High blood pressure is a risk for cardiovascular disease and stroke, two of the chronic diseases listed above. It is estimated that in 1999-2000, there were 40.4 million women and 46.6 million men with hypertension. From 2015 – 2016, those numbers jumped to 53 million and 55.2 million, respectively.
Another example is diabetes. The overall prevalence of diabetes is rising steadily. Previously, type 2 diabetes was predominantly a disease of middle-aged and older individuals and historically has been referred to as “adult-onset diabetes.” There has been a significant decline in the age of onset, and we are seeing this disease much more commonly in children and adolescents; a recent study revealed that one in five adolescents has pre-diabetes. I cannot tell you how shocking that is.
One in four adults has prediabetes, and while not everyone with pre-diabetes will develop diabetes, the concern is that many will. Many also have additional risk factors for cardiovascular disease, stroke and even cancer, including obesity, high blood pressure and high cholesterol. Diabetes is, in turn, a risk factor for cardiovascular disease, so the increased incidence may result in more cardiovascular disease, and the significantly earlier onset of diabetes may mean that we will see cardiovascular disease earlier in life.
Similarly, we are seeing growing prevalence of obesity and at a younger age. About one in three of American youth are overweight. Obesity is a risk factor for cardiovascular disease, diabetes, Alzheimer’s disease, cancer, arthritis and stroke. Obesity has now been associated with at least nine cancers – esophageal, pancreatic, colorectal, breast, endometrial, kidney, thyroid, liver and gallbladder.
My point is that even if we are successful in covering more individuals with insurance and providing more benefits, the pipeline of chronic disease is growing, and with that, health-care spending will increase. We will be seeing chronic diseases at earlier ages, resulting in a significant impact to employee productivity and absenteeism.
Therefore, even with the focus on improved efficiency, transparency in pricing and lower health-care prices, it is certain that health-care spending will go up significantly over the coming years and decades – unless we do something radically different.
At least eight of the 10 diseases listed above can be prevented or the risk reduced. The question is whether we as a society, and as a matter of health policy, will decide that we need to change the focus of our efforts from putting out fires to preventing the fires in the first place, so to speak. This would require significant investments in addressing the social determinants of health. Over a period of years, this would decrease the prevalence of these chronic diseases and therefore, our national health-care spending.
While the political system is not designed to reward long-term investments, these investments would do a lot more than decrease our health-care spending. Decreasing the number of people with chronic diseases at the prime of their lives would positively impact workplace productivity, absenteeism and employer health-plan costs. Improvements in education, one of the social determinants of health, are likely to result in increased wages, increased state GDP and less demand on Medicaid, and has been correlated with better health.
Surprisingly, I have rarely been asked, from a policy standpoint, how I would redesign the American health-care system to solve the current problems and challenges. A huge part of my plan would be an investment in addressing social determinants of health, preventive care, health screenings, health education and a focus on activity and healthy eating. For the past couple of years, we have seen the first-ever declines in American life expectancy. This is not just a failing health-care delivery system. This is a failure of society to address risks that are affecting our children.
Since the national discussion is what it is, let’s discuss some of the current proposals.
Medicare for All
There are many variations on this theme. The purest form (but neither proposal is pure Medicare for All) most resembles the proposals from Sens. Bernie Sanders and Elizabeth Warren. They are advocating for a single-payer (Medicare), universal (cover everyone) health plan.
It would be difficult to contemplate the cost for such a program and what this would mean in terms of corporate and individual tax rates; their proposals expand Medicare benefits, making their concept significantly more expensive than just an expansion of Medicare. They propose adding vision, hearing and dental coverage, which are not currently covered under Medicare. However, the part that adds tremendously to the cost is coverage for long-term care.
Keep in mind that the commercial market for long-term insurance has almost collapsed and most Americans wouldn’t be able to get a long-term health-care policy even under a free market, because of the adverse risk. If an insurer is willing to underwrite such a policy, most Americans can’t afford it. To imagine a Medicare program covering every American for long-term health insurance is to imagine an astronomical price tag attached to it.
While public support for “Medicare for all” has certainly increased over the past several years, that support significantly erodes when voters are told that their taxes will go up to pay for it. Further, though it is difficult to think of a scenario where it could pass the House, the Senate and be signed by the president, Democrats would have to, at a minimum, hold the House, take control of the Senate (60 votes) and have a Democrat in the White House. Even with all of this, as President Obama discovered in 2009, the lobbying resistance would be intense.
Democrats lost control of the messaging for “Medicare for all” long ago. Some candidates went overboard and indicated that they would cover everyone, including undocumented aliens. For citizens who have been struggling to pay for their own care, the thought that Democrats would now provide health care for free to undocumented aliens was offensive to many.
They then completely missed the messaging on the cost. Instead of realizing that just defending the cost of current Medicare benefits for every American would be a challenge, they added on expensive additional benefits for which there was no American outcry of demand. The conversation soon moved on to whether the middle class would be hit by tax increases and by how much; there was no discussion of the fact that middle-class Americans currently pay more than $8,000 per year for their insurance and all of this would go away under the Sanders and Warren plans.
Sens. Sanders and Warren also allowed the conversation to go off the rails when they proposed to get rid of all the insurance companies. That would likely happen under their proposals, but it wasn’t the point, and polls began to reflect that people overall were happy with their insurance plans. I doubt that this is even the case. My guess is that people are happy with their choice of doctors and hospitals under their plans, but I have yet to meet someone who tells me they love their insurer.
I believe Americans were reacting to fears of not being able to see the doctors and go to the hospitals of their choice, but under the Sanders and Warren models, most hospitals and physicians in the country would be in the network, which would be tremendously larger than the networks most Americans are currently in.
Get Rid of the ACA
While Republicans say they want to preserve guaranteed issue, their talk and actions do not support that (see last week’s blog post for a full discussion on this topic) and again, polling data demonstrates that this is important to Americans.
First, the Trump administration has supported short-term health plans, association health plans and ministry health plans. These are not guaranteed-issue policies. These plans place annual limits on benefits, charge higher-risk individuals more in premiums, can include waiting periods and exclude pregnancy coverage or charge separate co-insurance for pregnancy. None of these provisions would be allowable under the ACA.
These plans are obviously meant to remove young, healthy people from the larger insurance pool, making their health insurance premiums lower while increasing insurance costs for everyone else. More than one in four Americans under age 65 have something that could be characterized by an insurance company as a pre-existing condition. These plans will not meet their needs.
Further, a return to the days of excluding people from coverage for pre-existing conditions also means returning to the very undesirable situation where people believe they have coverage only to learn of their condition after purchasing insurance and the insurance company determining that, based upon prior symptoms or test results, the condition was pre-existing, even though the patient was unaware of the condition.
Finally, despite the rhetoric of Republicans supporting guaranteed issue, they have launched a constitutional attack on the ACA (see Texas v. United States above) that, if upheld on appeal, will end guaranteed issue, and they have been unable to draft any bill that could be enacted to protect guaranteed issue in the event of the ACA being struck down.
It is unfortunate that there is no discussion by politicians of either party as to the real issues driving health care costs and the tremendous threat that we face of even higher health care spending in the future. Perhaps I will write more about this in the future.
However, for now, the national discussion is what it is and people are being asked to make a choice. Therefore, my intention will be to inform you sufficiently about these various proposals so that you can make your own decision. In my next blog piece, I will explain to you what I refer to as the Trojan horse – the public option. This is something that few people understand, but you need to. This is what Iowa Democratic front-runner Mayor Pete Buttigieg is proposing, as well as former Vice President Biden. A public option would have huge implications for the entire health care industry, impacting it far more than the Affordable Care Act did. I’ll also have more to say about Medicare for All since it appears that Sen. Bernie Sanders is likely to win the New Hampshire Democratic primary and came in a very close second in Iowa. Finally, I will write about another proposal, this one from the Trump administration, concerning Medicaid block grants – something, for the sake of Idahoans, I hope the Idaho legislature does not pursue.