The Center for Public Integrity

Wouldn’t it be great if our candidates had to take a dose of truth serum every morning before hitting the campaign trail? If they did, those of us who will be voting tomorrow wouldn’t be nearly as confused about what Obamacare is and what it isn’t, what it will do and what it won’t.

Since there is no such truth serum requirement, I believe that many of us will actually be voting against our own best interests. Many Americans will vote for candidates who have scared them into believing that Obamacare is a government takeover of health care that it will bankrupt the country while slashing Medicare benefits.

In the event that you or someone you know might benefit from some truth-telling, here, then, are a few things you ought to know before pulling that lever tomorrow:

·         The Affordable Care Act is not a government takeover that has put us on a slippery slope toward socialism, or even toward a single-payer system like the one in the People’s Republic of Canada. In fact, the law actually shores up our uniquely American,  market-based,  multi-payer system now dominated by for-profit insurance corporations.  That is not my favorite part of the law. But if you think insurance companies contribute value to our system, you should know that Obamacare gives them a new lease on life.  Their business practices—which for years have included refusing to sell coverage to people with pre-existing conditions and pricing many other folks out of the system—have actually resulted in an ever-shrinking market. As a consequence, the insurers’ business models are not sustainable. Without a requirement that we all buy coverage from them, insurance companies will be able to grow only by taking market share away from each other and by persuading senior citizens to enroll in their profitable Medicare Advantage plans.

The big five health insurance companies have begun reporting their third quarter 2012 earnings and so far, they are pleasing their shareholders with profits that are better than Wall Street expected, in large part because they are doing especially well in one key area: Medicare.

Over the past several years, the largest insurers — Unitedhealth, WellPoint, Aetna, Cigna and Humana — have reported record profits, even during the quarters when enrollment in their employer-based and individually purchased health plans declined because of the recession. They’ve been able to do this in two ways: by taking in significantly more in premiums from their commercial customers than they have paid out in medical claims, and by persuading increasing numbers of retirees to enroll in their Medicare Advantage plans. If you enroll in one of their plans, the government sends a check to the insurance company you choose for your coverage. The amount varies depending on where you live. You might have to pay an additional premium out of your own pocket for better drug coverage, a broader network of providers, reduced copayments and discounts on gym memberships.

Many lawmakers have wanted to privatize Medicare for years and saw the Medicare Advantage program as an ideal way to begin that process. But insurers wouldn’t offer the plans without a significant financial incentive to do so. So several years ago the government started padding the checks it sends the insurers to get them to participate. By 2010 the cost to the government of Medicare Advantage patients on average was 117 percent of regular fee-for-service Medicare.

When people find out I used to work for an insurance company, many of them ask if I can help find them a decent policy that won’t bust their family budgets. Many others ask if I would consider going to bat for them after their insurer has denied coverage for a potentially life-saving treatment. And a lot of folks have reached out just to tell me their stories, just to get someone to listen.

That was the case following my column last week about Mitt Romney’s contention that uninsured people don’t have a problem getting the care they need — that the care is readily available in hospital emergency rooms. The commentary provoked an outpouring of emotion illustrating just out tragically out of touch many of our political leaders are.

Readers have left more than 600 comments since my column was published last Monday here and by the Huffington Post. Many were written by folks who just wanted to express an opinion about Mr. Romney’s comment or about Obamacare. But many others were from people who wanted to talk about losing a loved one or not being able to pay for care because of a system that has come to be controlled by powerful insurance companies. Here, in their own words, are a small number of them. They should provide all the evidence any politician needs to understand that the ER is not the magic cure some of them apparently think it is.

I understand where Mitt Romney was coming from when he said last week that Americans without health insurance don’t have to worry about dying at home.

“We don’t have people that become ill, who die in their apartment because they don’t have insurance,” the GOP presidential nominee told members of the Columbus Dispatch editorial board. “We don’t have a setting across this country where if you don’t have insurance, we just say to you, ‘Tough luck, you’re going to die when you have your heart attack.’ No, you go to the hospital, you get treated, and it’s paid for, either by charity, the government or by the hospital.”

I have no reason to believe that Romney saw anything wrong with what he said. In fact, I probably would have said the same thing back when I was still a health insurance PR guy and trying to convince folks that the problem of the uninsured wasn’t really such a big deal.

And Romney is absolutely right, people who are uninsured don’t have to die in their apartments. They can indeed be rushed to a hospital, and the hospital is obligated to treat them. It’s what he didn’t say, and likely doesn’t understand because he simply can’t relate to 47 percent of us, that is actually more important: many of the uninsured die in the hospital, in the emergency room, because they could not afford to get care earlier when it might have saved their lives. Instead of going back home to their apartments, many of them, unfortunately, go to the morgue.

In 2007, when the Democratic candidates for president were beginning to talk about health care reform, I was asked to write a policy paper that the insurance industry would use to “educate” people about the uninsured. I found that if you sliced and diced the data in just such a way, you could make people believe that many of the uninsured were simply shirking their responsibility by not buying coverage.

During last week’s debate, GOP presidential nominee Mitt Romney once again pledged to repeal Obamacare, but he was light on details about what he would replace it with, other than to suggest that his administration would encourage states to come up with reform plans of their own.

“What we did in Massachusetts is a model for the nation, state by state,” he said. “And I said that at that time. The federal government taking over health care for the entire nation and whisking aside the 10th Amendment, which gives states the rights for these kinds of things, is not the course for America to have a stronger, more vibrant economy.”

But considering that the Massachusetts law was the model for Obamacare, what, other than replicating what Massachusetts did, are the states to do?

High on the list of recommendations in Romney’s health care platform is an idea frequently touted as a silver bullet by conservatives: allow insurance companies to sell policies across state lines. Doing so, they say, will increase competition and, consequently, bring down the cost of coverage.

The problem is that no one had done a study to determine definitively whether the across-state-lines idea would work — until now. And the conclusion of that study, conducted by the Georgetown University Health Policy Institute, is that allowing coverage to be purchased across state lines is much more of a blank than a bullet.

The study also finds that no new federal law is even needed to allow insurance companies to sell policies across state lines.

“With or without changes to federal law, states already have full authority to decide whether or not to allow sales across state lines and, if so, under what circumstances,” the study noted.

If you want to get a clearer understanding not only of why the U.S. health care system fails so many of us but, more importantly, how we can transform it to make it the best in the world, go to the movies this weekend.

Regardless of your political affiliation or your opinion of Obamacare, you will find “Escape Fire: The Fight to Rescue American Health Care,” a compelling and convincing indictment of a health care system controlled by special interests that profit from the status quo and that spend millions of dollars every year to make sure nothing happens in Washington that would be harmful to their bottom lines.

You will also find that it offers some common sense ideas of how to fix many of the things about our system that are badly broken, including fixes that won’t require an act of Congress but that will require some innovative thinking and risk-taking on the part of health care providers, employers and other stakeholders in the private sector.

"Escape Fire" describes how health care in America has turned into a business, how the quest for money has hurt the quality of care provided to patients and how it has kept millions of us from having access to even mediocre care.

As a consequence of allowing this to happen, our system has become littered with perverse incentives, such as paying for medications and procedures that address only the symptoms but not the underlying causes of illness and disease, and not paying for prevention. Because of those perverse incentives, we have a system that rewards quantity instead of quality and that leads to unnecessarily expensive and often harmful overtreatment. And we spend enormous amounts of money on the latest high tech equipment but give short shrift to high-touch care, which in many cases is exactly what the patient needs.

The months-long Center for Public Integrity investigation into the Medicare program has uncovered a textbook example of the expensive consequences of  what’s known as “regulatory capture.” Doctors and hospitals are likely being overpaid billions of dollars, which is hastening the depletion of the Medicare trust fund, because lawmakers and regulators put lobbying and professional groups representing health care providers in charge of writing the rules that determine reimbursement.  

And to make matters worse, to maximize revenue and profits, some doctors and hospitals have figured out how to game the system to their financial advantage by abusing what has been held out as a means to improve care and reduce administrative costs —electronic health records.  

“Regulatory capture” is a term that describes an all-too-common situation at both the federal and state levels in which special interests — in this case groups like the American Medical Association — dominate regulatory bodies that set the rules and make important decisions affecting them. In many regards,  the Centers for  Medicare and Medicaid Services (CMS) has become a “captured agency” as a result of decisions made decades ago — with the full blessing of both the White House and Congress — to pretty much let health care providers determine how — and how much — they will be paid.

Politicians who are promising to repeal ObamaCare won’t find any evidence in the Kaiser Family Foundation’s analysis of health insurance costs that the law has caused premiums to skyrocket, as many of those politicians have contended.

On the contrary, premiums have increased on average only 4 percent over the past year, the lowest rate of increase in years, according to Kaiser’s 2012 Employer Health Benefits Survey, which was released last week. Double-digit premium increases were once the norm, especially during the George W. Bush administration. Premiums increased 10 percent in 2004 and 13 percent in 2003.

So the good news is that premiums increased only 4 percent. The not so good news is that, because of all those past double-digit increases, the average premium for employer-sponsored health coverage has reached a record high of $15,745. And because employers have been shifting more and more of the cost of coverage to workers, employees are now paying, on average, nearly 30 percent of that total, much more than they used to. The hike in worker contributions has far outstripped the overall rise in premiums.    

A study published last year in Health Affairs found that the gains in wages U.S. workers made over the past decade were more than wiped out by increases in the cost of health care and health insurance. Kaiser’s annual surveys document that: since 2002, premiums have increased 97 percent, which is three times as fast as wages (33 percent) and inflation (28 percent).

That’s not all the bad news, unfortunately. More Americans are now enrolled in high deductible plans, because that’s frequently all their employers are offering. Kaiser found that the percentage of workers enrolled in plans with an annual deductible of $1,000 or more has increased from 10 percent in 2006 to 34 percent in 2012. The growth has been even greater for employees of small firms.

What happened in Maine is a sobering reality check on the oft-repeated myth that getting rid of ObamaCare and other consumer protections is the answer to our health care problems. If the government will just get out of the way, the myth-makers would have us believe, the free market will magically transform our dysfunctional health care systems into one of the world’s very best.

The voters in Maine fell for magical thinking in 2010 when they turned over control of the legislature and governor’s office to candidates who promised to block ObamaCare and implement what they called “common sense” free-market solutions. Once they did, they assured voters, insurance premiums would fall and more people would have access to affordable care.

Sure enough, soon after being sworn in, lawmakers passed legislation that in many ways took Maine in the opposite direction of where President Obama wanted to go. When newly elected Republican Governor Paul LePage signed the bill into law —a bill enthusiastically endorsed by insurance companies — many consumer protections enacted over two decades disappeared. Especially hard hit: people living in rural areas and folks over 40.  

Among other things, the new law abolished protections for rural families that had required insurers to have at least one doctor in their provider networks within 30 miles of where those families lived and at least one hospital within 60 miles. The law also allows insurance companies to effectively double rates for older residents. That provision is affecting not only individuals and families, but also small businesses that employ older workers. Within months of the bill’s passage, insurers began jacking up the rates they charged businesses with older workers by 90 percent or more.

Even so, backers of the new law continued to insist that after it had been in effect for awhile, the measure would help a majority of Mainers.