Federal reform update

Obama’s attention turns to affordability
In a series of television interviews airing over the weekend, President Obama continued his press for passage of health reform legislation, arguing that insurance will be made affordable through a competitive exchange and government subsidies (“Obama Insists That Insurance Will Be Affordable,” New York Times, Sept. 21, 2009).

The focus of the health reform debate appears to be shifting to affordability as the Senate Finance Committee prepares this week to mark up its proposed bill (pdf, 223 pages). At issue is criticism among some Democrats that the bill crafted by Sen. Max Baucus, the Montana Democrat who heads the Finance Committee, does not offer generous enough subsidies to offset its mandate that all individuals have insurance.

Note: The Finance Committee released a list of 564 proposed amendments to its bill on Friday. A summary of amendments related to the health care delivery system can be found here (pdf, 14 pages), coverage expansion amendments are here (pdf, 21 pages) and financing amendments are here (pdf, 10 pages).

The Health Foundation of Greater Cincinnati unveils reform Web site
The Health Foundation of Greater Cincinnati announced last week that it has created a new Web site devoted to providing information on the ongoing health reform debate. The site is: www.healthfoundation.org/reform.

Content on the site includes a discussion of what factors are driving the health reform debate, local opinion about health reform, and definitions of health care terms. One section, called "Is What I Hear True?", attempts to separate myth from fact.

Debate continues on financing reform
Legislators continue to debate the best way to pay for the proposed legislation (Source: “Democrats squabble over who will pay health-care bill,” Politico, Sept. 20, 2009).

At issue is whether taxing so-called “Cadillac plans” or fining individuals who do not sign up for coverage or employers who do not offer it amounts to a middle-class tax hike.

Obama said he “absolutely rejects the notion” that either plan should be considered a middle-class tax increase and Sen. Kent Conrad (D-N.D.), a Gang of Six member who supports the insurance tax on more expensive plans, argued that the tax is a necessity. “Does that create some pain? Yes, it does,” he said.  “People want to see real pain? Stay on the current course,” with health care costs rising unchecked.

However, many conservatives disagree. In a fact sheet released last week titled “The Max Tax: Baucus Health Bill Is More of the Same,”  the Heritage Foundation contends that “The Baucus bill would impose a new sales tax on drugs and medical devices and a new federal excise tax on insurance plans that exceed $8,000 for an individual and $21,000 for a family. These taxes will ultimately be passed down to the consumer, putting many middle class families on the receiving end of a tax hike.”

Studies: Employers struggling to keep up with health insurance costs
A series of new studies released in the past week all confirm that employers both nationally and in Ohio continue to struggle with providing health insurance coverage for their employees.

A new study from consumer activists Families USA found that the percentage of U.S. employers that offer health insurance to their employees has dropped from 69 percent in 2000 to 63 percent in 2008 (Source: “More employers drop workers' health insurance,” Columbus Dispatch, Sept. 18, 2009).

And in Ohio, the drop has been even greater. Ten years ago 65 percent of Ohioans were covered by employer health plans. By 2007, however, the number dropped to 58 percent, according to the Families USA study. At the same time, many larger employers have kept coverage by shifting more costs to employers through higher deductibles and co-pays, said Doug Anderson, chief policy officer at the Ohio Department of Insurance.

According to a release from Families USA, health care premiums rose 7.2 times faster than earnings from 2000 to 2009. While premiums increased 84.1 percent, earning rose just 11.7 percent.

Those same trends also were identified in the Kaiser Family Foundation’s annual review of health costs and another by insurance consultant Mercer (Source: “Firms reducing health benefits, survey finds,” Wall Street Journal, Sept. 16, 2009).

The Kaiser survey found that 21 percent of about 3,200 companies surveyed nationwide had reduced benefits or increased cost-sharing for employees. The Mercer survey found that 63 percent of employers will has employees to bear a greater share of expenses next year and 18 percent plan to eliminate more generous plans.

"We're in a period where employers are very concerned about costs, and that's why we're having a health-care debate," Kaiser Family Foundation president Drew Altman said.

Nearly 45,000 deaths caused by lack of insurance, according to study
A study by researchers at the Harvard Medical School concludes that as many as 44,789 Americans of working age die each year because they lack health insurance (Source: “Lack of Insurance to Blame for Almost 45,000 Deaths: Study,” Atlanta Journal-Constitution/HealthDay News, Sept. 17, 2009).

Using data from the Third National Health and Nutrion Examination Survey, conducted between 1988 and 1994, researchers determined that Americans without health insurance are 40 percent more likely to die than tose with private insurance. The results of the study were published on the Web site of the American Journal of Public Health.

However, the National Center for Policy Analysis, which supports more market-based reform efforts, called the research “flawed.”

"The findings in this research are based on faulty methodology and the death risk is significantly overstated," NCPA President John C. Goodman said. "The subjects were interviewed only once and the study tries to link their insurance status at that time to mortality a decade later. Yet over the period, the authors have no idea whether subjects were insured or uninsured, what kind of medical care they received, or even cause of death."