Reasonable Goals for Health Insurance Coverage and Defining Medical Necessity

Health care should be a right but it needs to be paired with some responsibility – some share of the cost, especially for routine care, and some attention to maintaining a reasonably healthy life style. To do so will not only lead to better health but reduced expenses overall – positive outcomes for all.
One of the major goals of the Affordable Care Act is to reduce the number of uninsured from the current about 50 million people (or 16+% of the US population) by both offering Medicaid to many more individuals and creating state-based insurance exchanges for individuals who cannot obtain insurance at their worksite. Medicaid will be available for those at <133% of the federal poverty rate (currently $22,050). The insurance exchanges will be available to everyone but those with income below 400% of the poverty level ($88,200 for a family of four) will be eligible for tax credits based on actual income. Unlike Medicaid which has essentially no cost sharing by the individual, insurance from the exchanges will be purchased at one of four levels – 60, 70, 80 or 90% of the approved covered expenses will be paid by the insurance; the remainder will be the individuals’ responsibility. Higher deductibles will likely correspond to lower premiums.

The Institute of Medicine (IOM), at the request of the Department of Health and Human Services, formed a committee to consider the process for defining “essential health benefits” which ultimately will translate into what is covered or not by the insurance from the exchanges. The IOM, wisely in my opinion, emphasized he need for affordability rather than just comprehensiveness. They argued that coverage should be “evidence-based, specific and value promoting over time.” They proposed that medical necessity should be based upon clinical appropriateness, best scientific evidence and a likelihood of providing an “increased health benefit…that justifies an added cost.” [For a fuller discussion of the IOM recommendations, see John Iglehart’s article in the New England Journal of Medicine, Oct 20, 2011]

These seem like wise and sensible proposals. Too often there has been a “push” to insist on very comprehensive coverage, little attention to evidence-based criteria and little or not cost sharing by the patient.

My own hope is to see insurance that carries high deductibles to encourage each of us to personally monitor our health expenditures. When we have our own money at stake, we are more likely to ask our physician if that MRI, procedure or specialist visit is really needed of if it is “just to be complete.” That high deductible may also encourage us to maintain a better life style and maintain our health. That is good for us and reduces the overall costs further.

My new book discusses these topics in detail – “The Future of Health Care Delivery, Why It Must Change and How It Will Affect You” will be published in Feb, 2012 by Potomac Books

Misconception– Health care is or should be a right – not a privilege and not a responsibility

During the presidential debates, Tom Brokow asked “is healthcare a right, a privilege or a responsibility?” The candidates did not answer the question but now would be a good time for Congress and the Obama Administration to balance the rights being offered as part of reform with corresponding responsibilities.
We are the only developed country that does not assure all of its citizens basic medical care insurance access – shame on us. We spend more per capita for medical care than any other developed country yet our outcomes are not the best – shame on us. We mostly use price controls to try to slow rapidly escalating costs. They not only don’t work but leave patients with less than adequate care and huge bureaucratic frustrations – not logical. All too many individuals find that they are denied coverage because of a preexisting condition when they move from one job to another or find themselves unemployed - unacceptable. As a population we have all too many adverse behaviors such obesity, lack of exercise and smoking that are leading to expensive, lifelong chronic illnesses like diabetes and heart failure – killing ourselves. And primary care physicians find that they do not have time to offer good preventive care nor care coordination to those with chronic illnesses because insurance does not pay for these essential activities, thereby resulting in more visits to specialists, more expensive prescriptions when life style changes could have been effective, more procedures and tests - all of which lead to higher total costs of care.
Howard County, Maryland has instituted a program that offers the uninsured access to primary care for a minimal fee along with specialist care given pro-bono and hospital care for no charge. But in return, each patient works with a health coach to develop a set of goals for the year such as weight control, smoking cessation, exercise enhancement or stress reduction. Patients also are expected to receive appropriate vaccines and obtain basic screening such as checks for high blood pressure. The health coach assists the patient to overcome barriers to success such as helping to find a free smoking cessation program or an inexpensive gym. Patients have been pleased with the program and responded well to the responsibility element. It is a model worth emulating.
Congress is rightly seeking to assure all of access to care regardless of ability to pay. It is not inappropriate for the tax payer to expect the individual in return to lead a reasonably healthy lifestyle as a means to not only maintain and improve health but to lessen the cost of care. Congress also plans to ban the practice of insurers excluding individuals with predisposing conditions. A reasonable expectation [responsibility] in return is that everyone participates in insurance so as to keep the risk pool large and the costs down. In another pairing of rights with responsibilities, commercial insurers and Medicare should be able to incent patients to hold down costs with premium reductions for those who do have an appropriate weight, do exercise, do not smoke, do get their vaccinations and do have screenings done.
Primary care physicians should be able to have a reasonable income without a huge patient load nor the necessity of short visit times but in return the insurer/payer should be able to expect excellent preventive services and good coordination of the care of those patients with chronic illnesses. In this model, both doctor and insurer each have their rights and each their responsibilities, resulting in better care, healthier patients and reduced total costs to the system. Government, and therefore the taxpayer, in accepting the responsibility of universal coverage for those who cannot afford it should have the right in return of a reasonably healthy lifestyle by those covered. The result is better health with lower costs over the long term.
This combination of rights and responsibilities can assure that everyone has access to care and incentives to better health. Yet, it will reduce expenditures through improved quality and eliminate many of the current frustrations with the “system.” It satisfies the legitimate arguments of those who insist that medical care is a right with the equally important argument that we all have to accept a meaningful level of responsibility for our health and its costs.

Maximizing Rights with Responsibilities to Enhance Access and Reduce Total Costs

Healthcare reform was supposed to be about both access to care and reducing the cost of care. So far it is only about the former and the new costs look to be huge with only a portion of the uninsured actually benefiting. As to cost reductions, the only suggestions have been mostly just about reducing payments to providers with the assumption that they can figure out how to provide good care with less funding. That is not a strategy but just a tactic – and it will backfire.
There does need to be a way to reduce costs and the way to do so is a combination of rights and responsibilities related to the development and the care chronic illnesses. It is possible to reduce health care expenditures without rationing and without draconian across the board cuts to providers. Much of the rapid rise in costs is due to the increase in chronic illnesses that last a lifetime and are expensive to treat – heart failure, diabetes with complications, cancer, etc. Over 70% of healthcare costs go to treat these individuals who are only about 15% of the population. And these illnesses are increasing in prevalence as the population ages and as we persist with adverse behaviors such as smoking, over eating, lack of exercise and stress.
Chronic illness should be addressed from two perspectives – coordinating the care of those who are already ill and preventing new illness from occurring. Both will reduce costs and improve the quality of life.
What has become very clear is that chronic illness needs intensive care coordination to prevent unnecessary specialist visits, procedures, tests and even hospitalizations – the source of excess expenditures. Primary care physicians [PCPs] are in the best position to coordinate care but do not do so because they are not reimbursed for the effort. They receive about 5% of the healthcare expenditures but can have a major impact on the other 95%. Changing the reimbursements to PCPs with the proviso that they coordinate care would have an immediate impact.
Workplace wellness programs that offer reductions in health insurance payments in return for healthy behaviors reduce over-all costs and improve the health of the workforce. Safeway, General Mills and others have convincing data on the value of wellness programs. It’s an incentive toward healthier living.
Similarly, insurance policies should have variable rates for behaviors and preventive medicine – not smoking, weight control and obtaining simple screening tests like blood pressure and cholesterol would mean lower premiums.
Combining rights [access to insurance at lesser cost] with responsibilities [live a healthy life style] for patients and rights [increased pay] with responsibilities [coordinate care] for PCPs will have a major impact on the total costs of care and do so quickly.