California’s Senate has passed a bill to study the possibility of a public option on Covered California, their state run exchange:
BREAKING: California Senate passes #AB2472 (@JimWoodAD2) on a 26-10 bipartisan vote. The bill directs a new CA Council on Health Care Delivery Systems to do a feasibility study of a #PublicOption in #CoveredCA & the state health insurance market. #CALeg https://t.co/jCImpoIGqw
— Health Access CA (@healthaccess) August 22, 2018
Study is needed as this is a big honking deal.
The biggest question that has to be answered in this type of study is a simple one. What problem is the potential public option trying to solve?
This is a critical question.
Emma Sandoe and I outlined the evaluation framework for potential Medicaid buy-ins last March. We thought there were several different types of questions that a Medicaid buy-in could solve but some of those questions are in direct conflict with each other.
- Improve choices on the exchange
- Lower non-subsidized premiums
- Provide better post-subsidy premiums
California has numerous Medicaid like insurers on their marketplace. Covered California aggressively manages the Silver Gap which means in most regions, there is only a single Medicaid insurer offering a single Silver plan with a significant Silver Gap. Adding another Medicaid like insurer or even a Medicare Advantage like provider in terms of what it pays hospitals and doctors will significantly compress the Silver spread. In regions without a narrow network, low premium insurer, a Medicare Advantage like insurer might be able to take the least expensive Silver position and rejigger the Silver spreads.
The challenge for the study and for California policy makers is identifying what problem they are trying to solve and then lining up the trade-offs that a public option at either Medicaid-esque or Medicare-like rates would generate.
Major Major Major Major
What a bunch of sellouts… studying the impact of a mere public option when they should be going all the way and failing to implement single-payer!
Thanks David, I hadn’t seen this.
kindness
Jerry Brown has left a footprint on the Democratic Party out here. Jerry is a moderate to liberal but he won’t do anything if he doesn’t see it working fiscally. We have been blessed with that one. The rest of the party, which has had it’s share of bomb throwers in it’s day, is much more disciplined than it had been previously. As a result now there are voters who were moderate Republicans but now vote for Democrats more than Republicans want to admit. Of course the Republican party going full Monty probably helped.
rikyrah
We will see what the study will say. I am interested.
Thanks Mayhew for the news.
Major Major Major Major
@kindness: I think Brown is a liberal but not a leftist, and while he’s conscious of budgetary impacts I don’t think that actually makes one conservative. I’m sure many disagree.
Baud
@kindness: @Major Major Major Major:
I don’t know how you can ignore budgetary impacts with respect to anything. The cash to pay for things has to come from somewhere.
Major Major Major Major
@Baud: neoliberal whore!
weavrmom
I think it’s become clear that the folks who don’t give a damn about budgetary impacts are Republicans, which is why they aren’t in charge here in CA anymore. The only time they ‘worry’ about such trivia is if someone who isn’t rich might benefit from a policy/program. Otherwise, let the looting begin, and ‘nobody cares about deficits’! As a fiscally responsible extreme liberal, I feel very comfortable here, where things get done for actual citizens. And more so every day, as we pull away from the wreck Republicans left behind them before they were thrown out. It’s wrenching to see the rest of the country choose to go through the same damn thing. We voted so hard against Trump bc we’ve seen where that leads. Just my 2 cents.
weavrmom
@weavrmom: Just adding: Another reason CA Repubs aren’t in charge anymore: extreme racism. Yeah, they are out in the damn wilderness, and gonna stay there.
Martin
Oh, I think the problem is easy – What are the dynamics and break even points of taxpayer-funded healthcare. I don’t see how this would be all that different from studies for single-payer – it just comes without the political freak-out.
Brachiator
@Major Major Major Major:
If you live in California, you know that they looked at single payer before and the cost would have been prohibitive.
CA currently has a number of programs including Medi-Cal, in addition to Obamacare and Medicaid. But a continuing problem I see is that too many people do not have, or cannot easily get, a primary care doctor.
Also, in the real world, California also has to serve a significant undocumented population (and this is a public good), and will have to do so despite increasingly hostile federal action. This has to be factored into the cost and service analyses of whatever the state comes up with.
ETA: I believe in a universal health care system. But I have not seen that single payer is the obvious solution.
Martin
@Major Major Major Major: Agreed. I really like Brown because he’s not afraid to sound like a small-c conservative on the budget. He is constantly restraining Democrats that are trying to restore social services cut under Republican budgets while still encouraging those services to be expanded to the degree the budget allows, while also pushing for increased revenue.
I’m not a deficit hawk, but over some reasonable time frame budgets do need to come into equilibrium. It’s also important to be realistic about the fragility of revenues, and CAs budget is pretty fragile due to how the tax system is structured. He has the benefit of being able to see the consequences of 50 years of budget policy better than anyone else.
My frustration with both Dems and the GOP is that both parties seem to be dependent on operating around (different) severely flawed understandings of economics. Brown runs his own course on that topic – one that I feel is much more realistic.
L85NJGT
@Baud:
We’ll seize the means of production, and float our own pot backed crypto currency.
Major Major Major Major
@Brachiator:
Yes. And a true liberal champion would keep heroically trying anyway.
ETA actual commentary I’ve seen! The original feasibility studies were flawed because the studiers didn’t clap hard enough/were tainted by corporate money
Brachiator
@kindness:
Very interesting point! There is, for example, this recent analysis:
However, California independents are not just “Rebublicans” who are afraid to say so. CA Independents, especially in state-wide elections, consistently vote for Democratic candidates. However, I can see that it might make sense that a former moderate Republican would be happy registering Independent and voting for Democrats.
Maybe Dems could find a way to exploit this in other states.
L85NJGT
The Public Option. How 2009.
Rural counties are at risk from a primary employer pulling out, and leaving a smaller, poorer, and less healthy headcount. Like those power rates going through the roof in (no longer) coal country.
StringOnAStick
The thing that never seems to get discussed in the idea of single payer, Medicare for all, etc, is just how expensive US health care is compared to the rest of the western world. The medical lobbies are pretty powerful because they are so damned rich. I’d like to know how other countries with a universal system of some kind manage to keep their costs down, in concrete terms, such as how much debt do MD’s have when they graduate from medical school, the hours they work, benefits, etc. Then move on to the differences between for-profit and non-profit. I don’t think we’re going to get to a true universal system without some wrenching changes to get provider costs down, and that’s going to be a serious fight with a lot of well funded groups opposed.
We’ve got a specialist MD friend in BC, he has normal hours because he’s an employee, and gets 3 month sabbaticals every 5 years. Compare that to the hours a private practice doc works and what a freaking crisis it is to get coverage so they can go on a vacation. A young anesthesiologist I know works for Kaiser because he likes having regular hours and being able to schedule time off without paying a fill-in doctor a fortune; quality of life counts and I’m hoping more new medical graduates see that. As for controlling costs for the for-profit imaging, urgent care, hospitals, etc., getting costs down there means wrestling with individual vampire squids and that’s going to be tough, but necessary. Plus of course the overarching wealthy entities known as health insurance companies…
L85NJGT
@StringOnAStick:
Yep. Private practice is all but dead. Providers are scaling up in a M&A frenzy, hoping to make the numbers work on the back of shared service job offs, facilities consolidation, and increased purchasing power. Bottom line is they have too many high income earners.
Martin
@Brachiator: Single payer is the inevitable solution, but the transition is unbelievably difficult and expensive. That’s why it usually happens when an economy completely implodes. All policy is cheap when there is no economy.
I don’t fault the senators from Nebraska and CT for being uneasy about the public option – a significant number of jobs in their states are dependent on selling insurance to people. And I’m of the view that if a policy change of that scale needs to take place, then just buy out the affected workers, don’t put the economic costs of the transition on the shoulders of the workers. And that applies to a lot of places – if Mexico is such a great place to build air conditioners, than buy out the workers in Indiana that are going to lose their job.
There are only 16,000 coal miners in the US (actually in the extraction jobs). The EPA just said that the cost of continuing to use coal for energy would cost 1,500 lives a year. I mean, FFS, there is no way in hell the economic benefits of keeping 16,000 people in jobs beats out the economic loss from 1,500 workers dying. Take the lifetime economic benefits from keeping those 1,500 people alive and just give it to the 16,000 workers. It’s got to be more than what they’re earning now.
Brachiator
@Martin: If single payer was the inevitable solution, every country with universal health insurance would have it. But this is not the case. There’s variations.
kindness
@Brachiator: I have serious doubts about any study that states that California Democrats are leaving the party in droves. That is some fine quality bullshit there.
Brachiator
@kindness: The data about California voters registering as independents has been consistent for a number of years. There’s nothing controversial here. And as I noted, voters tend to favor the Democrats and punish the hell out of the Republicans. Facts is facts.
jl
@StringOnAStick: I think you make very good points. For some reason the US is absolutely obsessed with how to finance the insurance, and far too little emphasis on other policies that will be needed for good population health and affordable care no matter what method is used to finance the insurance.
First there is the famous three-legged stool: 1) universal coverage and participation, 2) community rating that eliminated individual underwriting for basic coverage. and 3) subsidies for low income people and risk adjustment for providers that get a bad risk pool for whatever reason.
I think you can also add 4) some method to control monopoly and oligopoly price gouging, 5) free or very cheap preventive care and care that is critical for long term health, such as child health and maternity, and 6) elimination of unregulated profit motive for basic care. That last is important, even countries with supposedly private market systems, such as Netherlands and Switzerland have policies that eliminate (Switzerland), or control (Netherlands, where above regulated profit has to be reinvested in health care investment) profit motive for basic care.
Those are just as important as how insurance is financed. I think it would be interesting to see how much of the conclusions of these studies depend on the mode of financing itself, versus the other aspects of the system.
jl
@Brachiator: I agree. But I think the US may have to move, one way or another, towards single payer because successful multi-payer, and private market systems will face too many problems with political feasibility, and legal and Constitutional hurdles in the US. The very strict regulation needed for a more private market based system similar to Swiss, Dutch, or Singapore system just not work in the US. I think some of the methods Dutch and Swiss use to control price gouging by providers and insurers may be struck down by courts, and be considered restraint of trade. IANAL, so I am not sure. but is there a feasible way to get each state to force physicians and labs to negotiate a fixed fee schedule for each service? Can the US impose federal open book audits, some of which by law must be made public, for any provider that wants to go above soft price control bands? I dunno. May end up will just go Medicare for all, either through legislation, or gradually through buy-in and gradual program expansion.
jl
@jl: And the Swiss and Dutch regulation would include forcing state by state hospitals, clinics and pharmacy to agree to fixed price schedules for at least a year. Even if the AMA agreed to a system like that, I doubt big corporate interests that run much of those big cost centers would agree. They would run to the welcoming arms of Roberts and Gorsuch in the Supreme Court to strike any plan like that down.
Bob Hertz
Does California really have to give medical care to the undocumented? I am a liberal from MN, but I am baffled at how much California spends on non-citizens.
jl
@Bob Hertz: In California, unless they have fraudulent documents for eligibility, undocumented immigrants have to rely on emergency services and indigent care. They don’t quality for the CA Obamacare program, or state Medicaid program.
Here is a link to the fact sheet for Covered California, the state PPACA exchange
https://www.coveredca.com/individuals-and-families/getting-covered/immigrants/
jl
@Bob Hertz: I don’t think there are good estimates of state by state costs of heatlh care to undocumented immigrants. Right wing thinktanks have some wild guesstimates the fit their preconceptions, but people can go find them on their own. Here is a good source for national estimates. Maybe could divide by proportion of undocumented immigrants in each state to get state estimates.
HEALTH AFFAIRS VOL. 25, NO. 6:
Immigrants And The Cost Of Medical Care
Dana P. Goldman, James P. Smith, and Neeraj Sood
https://www.healthaffairs.org/doi/10.1377/hlthaff.25.6.1700