Health Policy Checkup

Health Policy Briefs April 3, 2012

Compiled by Benita Dodd

Breast cancer surgery or not? In the Health Policy Checkup of February 14 we recommended “Overdiagnosed,” the eye-opening book by Dr. H. Gilbert Welch that reveals the unhealthy impact of too much health care. Excessive medical screening and diagnostic treating in asymptomatic people can produce overtreatment. The quest to detect health problems as early as possible is often more harmful than helpful, as Welch points out.

Now comes a study out of Norway that estimates that between 15 percent and 25 percent of breast cancers found by mammograms wouldn’t have caused any problems during a woman’s lifetime, but these tumors were being treated anyway. Researchers estimated that for every 2,500 women offered screening, one death from breast cancer will be prevented but six to 10 women will be overdiagnosed and treated.

“When you look for cancer early and you look really hard, you find forms that are ultimatedly never going to bother the patient,” Welch told the Associated Press. It’s a side effect of early diagnosis.” Welch was not part of the research. Source: Associated Press

Alternatives to the feds: In “Healing Health Care Policy in Georgia,” the Georgia Public Policy Foundation’s Friday commentary on March 30, I outlined some of the state-based proposals that would work instead of a top-down federally-regulated health care system for the uninsured. Among them is leveling the playing field, so that people who purchase their own policies do not face tax discrimination.

Health care expert John Goodman of the National Center for Policy Analysis expands on this in his health care blog, titled, “Is there a Republican Alternative to Obamacare?” Goodman suggests a system of tax credits so that “people who must purchase their own insurance (including part-time workers and the self-employed) would get just as much tax relief as people who obtain insurance through an employer.”

The approach should start with these basic ideas, Goodman says:

  • The current system of tax and spending subsidies would be replaced by a tax credit of, say, $2,500 per person or $8,000 for a family of four for the purchase of health insurance.
  • The subsidy would be refundable; everyone gets it even if he does not owe any income taxes.
  • Families can obtain the subsidy in the year in which the insurance is purchased and would not have to wait until April 15 the following year to get their credit.
  • Insurance companies and other intermediaries would be able to help families obtain their credit and apply it directly to the health insurance premiums.

Most beneficial of all, “The tax credit would subsidize the core insurance that everyone should have. It would not subsidize all the bells and whistles, as the current system does. Since employees and their employers would be paying for additional coverage with after-tax dollars, everyone would have an incentive to compare the value of extra health benefits to the value of other things money can buy.”

Medicaid Patients and the ER:  Researchers have found two standout trends among Medicaid beneficiaries: They have more difficulty getting primary care and they visit hospital emergency departments more often than those with private insurance, according to data from the U.S. National Health Interview Survey between 1999 and 2009.

Medicaid patients face significantly greater barriers to primary care, including not being able to reach a doctor by phone, not being able to get a timely appointment with a doctor and lack of transportation to the doctor’s office. Researchers found that about 16 percent of Medicaid beneficiaries faced one or more such barriers to primary care. This proportion is significantly greater than the 9 percent of those with private insurance who have the same problem.

Dr. Adit Ginde, of the University of Colorado School of Medicine, says the lack of primary care is just one part of the ER use, citing an overall lower health quality among Medicaid patients as another factor. Source: U.S. News and World Report

Medicare as we know it may be on its way out: Medicare, which provides health care to the elderly and disabled, is under consideration for some changes, especially when lawmakers take into account the costly imminent enrollment of retiring baby boomers, according to Health Affairs. U.S. Rep. Paul Ryan (R-Wis.) and U.S. Sen. Ron Wyden (D-Ore.) propose an innovative plan that would more or less supplant the traditional fee-for-service system of Medicare in favor of a subsidy program.

Here’s how it would work: The plan would encourage participants to seek out health insurance options that fit their specific needs. The government would then provide participants a fixed contribution to help them pay for that insurance’s premiums. If the amount of the contribution were less than the premium, the individual policyholder would make up the difference. The government would control its aggregate spending through a predetermined growth formula that recognizes the historical inflation of premium rates.

The Ryan-Wyden plan would eliminate current Medicare almost entirely, allowing continued access only for a small number of participants.  Additionally, the plan has set its growth formula at the rate GDP growth plus one, expected to will allow for government savings while providing ample support for retirees so that their premiums do not become unaffordable. Reports vary on how the plan will affect government spending in the area, but most conclude that it will create significant savings: The Congressional Budget Office estimated that the 2011 Ryan proposal would probably reduce federal spending by 2030 by 8 to 11 percent and be affordable for participants. Read more here: Source:

Quote of Note: “Why do you define the ‘market’ that broadly: ‘Health care?’ It may be that everybody needs health care sooner or later, but not everybody needs a heart transplant; not everybody needs a liver transplant. Could you define the market such that everybody has to buy food, sooner or later? So you define the market as food; therefore, everybody’s in the market; therefore, you can make people buy broccoli?”  — U.S. Supreme Court Justice Antonin Scalia

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