Posts Tagged ‘Wellpoint’

The Insider: The Political Ecology of Health Reform Implementation

Wednesday, May 5th, 2010

Throughout the debate on passage, pollsters regularly found that the public wanted a “bipartisan solution” to health reform. Of course, no such solution was forthcoming if by bipartisan we mean something that attracts votes from members of both parties. As implementation moves forward, the partisan divide looks, if anything, to further grow.

The persistence of these bipartisan wishes suggests that many Americans do not fully appreciate the extent of the rightward shift in the Republican Party. This can clearly be seen in the standing of Republican Governor Charlie Crist of Florida, now a candidate for the U.S. Senate who recently decided to run as an independent after he was overtaken in the primary polls by tea-party favorite Marco Rubio. Crist, while less extreme than former governor Jeb Bush, is no liberal. But he finds no home for himself in today’s Republican party. Similarly, Utah Senator Robert Bennett is at risk of losing his party’s nomination to a challenger on his right, even though he has an 84 percent lifetime favorability rating from the American Conservative Union.

Another marker of this shift is the sharp contrast between the support for reform of recent Republican leaders such as former Senate Majority Leader Bill Frist from the pronouncements of today’s party leaders. Even some of the moderate Republican governors who have been more supportive of reform—e.g. Connecticut’s Rell, and Schwarzenegger—are about to exit the political stage.

If the elections were held today, most projections show that the Republican Party, increasingly indistinguishable from the extreme far right, would claim a significant though not decisive victory, bringing into office a new crop of officials publicly committed to repeal of reform.

That’s the bad news.

The good news comes in two parts:
a) Even if there is an electoral tsunami, the repeal strategy faces enormous hurdles and
b) While the repeal torch burns as hot as ever for the true (un)believers, there is some indication of an upswing in support from the general public.

The latest Kaiser poll shows 49 percent of the public supports reform, compared to 40 percent who are opposed. Importantly, all of the early implementation provisions rack up big majorities among Republicans and Independents as well as Democrats.

The popularity of these measures muddies the message of the repealers–but only if people know about them. Educating the public about the early provisions of reform, then, is crucial not only to make sure that people get the new benefits, but to influence the future political environment in which reform will be implemented.

Insurance Rate Regulation and Beyond
When it rains it pours for insurance giant Wellpoint. Last week it was outed for its aggressive policy of trying to dump women with breast cancer from its rolls. Then it withdrew its controversial proposal for a 39 percent premium rate increase in California, admitting that there were errors in its calculations but claiming those miscalculations were inadvertent.  (In related news, the company has announced it will be putting the Brooklyn Bridge on the market to help recoup the revenue from the cancelled rate increase, but so far no buyer has stepped forward).

Even taking the company at its word, Wellpoint’s debacle illustrates the need for stronger rate oversight. Leaders of the Senate HELP committee continue to debate the options for moving the Feinstein rate oversight bill, S.3078, which also picked up an important endorsement from the American Cancer Society/Cancer Action Network. Companion legislation has been filed in the House by Illinois Congresswoman Jan Schakowsky.

At the same time, advocates need to be mindful that strong oversight of insurance premiums is a necessary but not sufficient piece of the cost-containment puzzle. The anti-trust investigation into possible monopoly pricing by Partners Healthcare—the largest hospital system in Massachusetts—illustrates a pervasive problem in the U.S. health system. While it remains to be seen if there was anything actually illegal in Partners’ negotiating strategy, the issue of concentrated provider power is real and not confined to Massachusetts. (See this recent report on the effect of market power on health care costs in California.)

In fact, the high prices that we in the United States pay for health care across the board add much more to our high costs than do the mix or amount of services we use, as Ezra Klein shows here. On a series of charts comparing the prices U.S. insurers pay to those of other countries–regardless of procedure or number of appointments–“the block representing the prices paid by American health-insurance plans [looms] over the others like a New York skyscraper that got lost in downtown Des Moines.”

Sure, it’s fun to pick on the insurers, and certainly they deserve it. But we can’t approach cost-containment like the drunk looking for his keys under the streetlight–not because that’s where he dropped them, but because that’s where the light is. Going after the insurers may represent the low-hanging fruit, but the sustainability of health reform will depend on effective cost-containment–and that means taking a close, hard look at the delivery system.

–Michael Miller, director of strategic policy

The Insider: Repeal Watch

Tuesday, April 27th, 2010

With Enemies Like This, Who Needs Friends?

As they tried to regain their footing after the surprise Senate election of Scott Brown, reformers received an unexpected boost from for-profit insurer Wellpoint. In February, the insurance giant announced it was planning to raise rates by 39 percent in California, and similarly large increases were reported elsewhere. Coming off a $2.5 billion profit in the last quarter of 2009, this didn’t sit so well with much of anyone but insurers, and became a major rallying point in the White House, Congress and advocates’ final push for reform. Some conservative commentators went so far as to blame Wellpoint for reform’s subsequent passage.

Now Wellpoint is at it again.  Recent headlines suggesting that the company routinely targets women with breast cancer for rescission boost the case that, if anything, the tougher insurance oversight that is part of the Patient Protection and Affordable Care Act doesn’t go far enough.   Since it seems the folks at Wellpoint can’t help themselves, it’s up to advocates and regulators to stop them before they kill again (no joke).

Repeal Watch 1: Public opinion
This latest Wellpoint scandal makes it crystal clear: The repeal chorus is defending the indefensible.  And yet, with 45 percent of conservatives getting most of their information from cable news, it’s unclear that the indefensible is making it on air. The latest Kaiser tracking poll (pdf) has some moderately good news for reformers: a plurality of the country supports reform, but many are confused (or misinformed) about what reform actually does.

This lack of understanding underscores both the need and opportunity for an aggressive public education effort using all available means—everything from paid and earned (and social!) media to one to one conversations at the community level.

More bad news for repealers (and good news for us): there is strong cross-partisan public support—among Democrats, Republicans and Independents—for the early provisions of reform like small business tax credits, $250 rebate for seniors with high drug costs and coverage for children with pre-existing conditions.

But people over 65 continue to hold a more negative view of reform than younger adults do—and that’s worrisome, especially in light of their disproportionately big turn out at the mid-term polls, which we’ve talked about here before.

Even so, repeal may not be the ticket to ride that some conservative activists hoped for. A recent poll of Florida voters showed that a majority think that the state Attorney General McCollum’s decision to sue the federal government was a bad idea and that McCollum, the front runner in the Florida governor’s race, was losing ground.

Repeal Watch, Part 2:  Breaking down the repeal arguments

Voters have good reason to be skeptical of the repeal efforts, which have overwhelmingly been advanced by candidates seeking higher office or as part of a larger right-wing electoral strategy. A growing number of state legislatures hold a similarly skeptical view—so far more than 12 have rejected repeal measures.

And they are right to, since the main repeal arguments are so far-fetched.  Basically, they amount to:

  • The law is illegal because the Medicaid expansion imposes new costs on states. By the same reasoning, other provisions of Medicaid law, such as the requirement to cover certain children or people with disabilities, would also be illegal, and Medicaid would become nothing more than a blank check written to the states. And what of those new costs? A recent CBPP report shows that new state costs through 2019 add up to only 1.25 percent of projected state spending, and that’s before factoring in possible offsetting savings to states.
  • States have the ability to selectively decide which federal laws they will obey. This argument essentially parallels the case made by segregationists almost 50 years ago and has been decisively rejected by the courts.
  • The individual mandate falls outside of Congress’ authority to regulate interstate commerce because it regulates “inactivity” and/or it is an impermissible tax.

But from a legal standpoint, the “mandate” falls squarely within Congress’ authority to raise taxes. Semantics aside, the individual mandate is not really a mandate, but a financial incentive to purchase coverage.  From an economic standpoint, it is no different than the existing tax subsidy that goes to employer-sponsored coverage; lowering the cost of doing something or raising the cost of not doing it are functionally the same (more at the New England Journal of Medicine–subscription required).

In sum, both the legal and political campaigns for repeal (if indeed the two are distinguishable) rest on shaky ground—and more and more voters and political leaders are beginning to figure that out.

–Michael Miller, director of strategic policy