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Editorial: There are some positive Rxs in sick health care system

Obamacare, long under attack by Republicans who knocked out key provisions like the individual mandate, did result in more people with health coverage. But many of those – especially in New Mexico – simply enrolled in government programs like Medicaid. And nothing was done to control the real issue: costs.

And so the long-term impact has been to squeeze health care providers by failing to adequately reimburse doctors and hospitals under Medicare and Medicaid – with those providers in turn increasingly squeezing the private health insurance market to make up for the deficits.

In fairness, this dynamic goes back to the mid-1990s.

But a piece by three Ph.D.s at the Johns Hopkins Bloomberg School of Public Health in a recent Journal of the American Medical Association explains how it’s exploded.

For example, between 1996 and 2001, private prices for inpatient hospital stays were 10% greater than Medicare rates. By 2012, the gap was 75%. The government sets Medicare rates, so hospitals continued to ratchet up charges in the only area they could: private insurance. “These high and rising prices have forced employers to devote a larger share of compensation to health benefits, which constricts wage growth, and to pass on costs to employees in the form of higher premiums and cost sharing.”

People with employer-sponsored health insurance have experienced a steady climb in out-of-pocket costs in the form of premiums, deductibles and out-of-pocket limits. Out-of-pocket spending by people with private insurance jumped 12% between 2013 and 2017, leading many to skip doctor visits affecting the ability of clinicians to treat patients.

Even so, the tab is staggering. By one estimate, 43 million Americans have about $75 billion in past due medical debt on their credit reports. Many of those people had insurance.

Democrats are talking about various permutations of “Medicare for All” without necessarily having a viable plan to pay for it – or even defining what it is. Medicare isn’t anything approaching free – you pay via Social Security deductions and need supplemental coverage for doctor visits, prescriptions and dental. And even now it isn’t paying its share of underlying costs. Yet there are positive developments.

Bipartisan Senate legislation pushed by Republican Lamar Alexander of Tennessee and Democrat Patty Murray of Washington has momentum. Among other things, it aims to bring more lower-cost generic drugs to patients by eliminating anti-competitive practices by brand drugmakers and targets the notorious practice of “surprise billing.” The specific intent of the bill is to reduce out-of-pocket costs.

And, the bill now includes an amendment introduced Monday by Senate Majority Leader Mitch McConnell, R-Ky., and Sen. Tim Kaine, D-Va., that would raise the legal age for buying tobacco to 21. Alexander welcomed it. American Heart Association CEO Nancy Brown urged “strong bipartisan support” and urged lawmakers to resist language to weaken the impact or benefit tobacco companies. They should.

Administratively, the Trump administration has approved a landmark change allowing companies to provide employees with tax-free dollars to buy an individual policy rather than offering a group health plan. The hope is more buyers in the individual markets will stabilize insurance pools and the new “Health Reimbursement Arrangements,” or HRAs, will make health benefits easier for workers to evaluate.

U.S. health care is a massive industry, accounting for nearly 18% of gross domestic product in 2017. It affects every single person. While it makes sense to debate overhauling the system and we have to get honest and transparent about costs, we can improve what we have. Finally, both parties in Congress are taking steps in that direction.

This editorial first appeared in the Albuquerque Journal. It was written by members of the editorial board and is unsigned as it represents the opinion of the newspaper rather than the writers.

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