1. Marcia L. Comstock, MD MPH Carol A. Staubach, MPH
Health Care Coverage: Different Problems, Different Solutions, Everyone’s Issue
Marcia L. Comstock, MD MPH
Carol A. Staubach, MPH

2. Today’s Agenda on the Uninsured
What does it mean?
Why should you care?
How did we get here?
What do you think?
What do others think?
What can be done?

3. Cover the Uninsured Week
Does insurance “coverage” equal “access”?
Is each of us our “brothers’ keeper”?
Should it matter to us as an individual, as a member of a family, as a member of society that many Americans are not assured access to healthcare that promotes and sustains health and productivity?

4. Key Facts About Health Insurance
About 246 million people have health insurance that pays part of the costs of getting care.
Almost 46 million individuals do not have health insurance.
The likelihood of an individual or family being covered depends on many factors, including the kind of job they have, their income level, where they live, their age, and their health status.
No additional notes needed

5. Who Lacks Access to Health Insurance?
More than 1 in 7 Americans – almost 46 million – do not have health insurance.
They are not necessarily “poor.”
Over 80% are members of working families, often they can’t afford to buy health insurance.
Over 80% of uninsured children live in families with at least one working parent.
Some uninsured could afford to buy health insurance, but choose not to.
This estimate of the number uninsured is for one point in time during the year. Other estimates of the number of people with no health insurance at ANY point in time during the year are significantly higher: an estimated 51.6 million in The number of people estimated to have no health insurance at all for more than a year is lower: 29 million people. In addition, millions more who do have health insurance have only very limited coverage.

6. Who are the Uninsured?
Hispanics and low income adults are most likely to be uninsured.
Source: Economic Research Initiative on the Uninsured; based on MEPS 2002 data.

7. Most Uninsured People Work
No additional notes needed
Note: Numbers may not add up to 100% due to rounding.
Source: Economic Research Initiative on the Uninsured, 2005.

8. Most Uninsured People Have Incomes Above the Poverty Line
Many still can’t afford health insurance.
Their incomes may be too high to qualify for help.
Note: Numbers may not add up to 100% due to rounding.
Source: Economic Research Institute of the Uninsured, 2005.

9. In fact, the fastest growing segment of the population lacking insurance is for individuals and families with annual incomes over $75,000.

10. The Uninsured* are More Likely to Not Get Care Due to Cost
No additional notes needed
Source: Centers for Disease Control and Prevention, National Center for Health Statistics, 2005.
*People under age 65 in 2003.

11. Becoming Uninsured Could Happen To You!!!
Unexpected changes can affect coverage:
Serious illness or injury
Worsening of a chronic condition
Losing or switching jobs (after federal COBRA protection runs out or is unaffordable)
Changes to health insurance policies
People can keep insurance from an employer for a limited amount of time after leaving a job under COBRA.
COBRA (Consolidated Omnibus Budget Reconciliation Act ) provides certain former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage at group rates. 

12. What are the Consequences of Being Uninsured?
People without insurance:
Are less likely to get health care that they need, especially preventive care and treatments for chronic health problems
Are at risk for the huge expenses of catastrophic health care
May have worse health outcomes
~18,000 died last year because they did not have health insurance, according to IOM
What do we mean by catastrophic? Medical care so serious in nature as to require extensive, long-term, and expensive medical treatment

13. What are the Consequences of Having Uninsured People in Our Community?
A burden on hospitals for uncompensated care
Cost-shifting to employers
Negative impact on community health
Drain on economic development

14. How Did We Get Here? In the beginning…….
Insurance: Coverage by contract in which one party agrees to indemnify (guard or secure against anticipated loss) or reimburse another for any loss that occurs under terms of the contract.

15. Before Health Insurance…
US railroads and wanted to insure productivity of employees
Hired contract physicians (surgeons) to care for employees
No insurance—healthcare services provided for employees…but in the interest of their employer!

16. The Beginning of Health Insurance-”The Blues”
Blue Cross 1st created by President of Baylor University to pay for hospital care
If everyone paid a small amount ($15/wk), those that needed hospitalization could be cared for (benefit of $25,000)
1932-Texas Legislature passed the enabling statute to create the first blues plan
Law became a national model
It was expanded after a decade to include payment for physician services, “blue shield”
The plans were NFP companies
BODs represented community-citizens, providers, businessmen
Concept of “shared social responsibility”

17. Employer Role in Healthcare
Originally employer-based insurance was not for healthcare. It started as insurance for lost wages when ill
Early 1940s: amendments to Tax Codes allow business to offer health insurance to help recruit workers despite wartime wage freezes
: growth in cost & utilization of medical services by employees, supported by labor unions
Health insurance typically 80/20; co-pays, deductibles
1980s: growth of managed care as response to rising costs-temporarily effective—1st dollar coverage, NOT insurance
Late 1990s-resurgence of costs
2000+ move to consumer-directed health plans…..??solution
Some employers offer on-site clinics/pharmacies….?Back to the future?

18. The 5 A’s of Access
Health insurance does not equal access to the right healthcare!
Affordability
Accessibility
Acceptability
Assurance
Appropriateness

19. Coverage & Access: What Does it Mean?
Coverage refers to the ‘menu’ of what is available through an insurance policy (limited vs comprehensive.) Relates to technical adequacy and assurance of services
Access refers to what is 'practically' available and encompasses barriers such as affordability and logistical accessibility
Coverage opens the door but does not ensure access!

20. Issues with Coverage & Access
What are we trying to achieve with coverage and access??
Language is important! People don’t use these terms to mean the same thing.
If coverage equals insurance, we need to answer the question, insurance for what?
We have not been able to reconcile our split approach to “sponsorship” of health insurance, or pick one over the other.
Coverage means more than insurance. It is 'protection', 'security' that is defined at the individual level

21. Do you have health insurance?
Did you purchase it yourself?

22. The Plight of Employers

23. Our Health Care Crisis
Total health care spending represents 16 percent of the gross domestic product
Estimated to reach 20 percent by 2015.
The US has the highest per worker health care costs in the world
Impact
Erodes corporate profits
Reduces growth of business
For small enterprises or those with low profit margins
Reduces number of jobs
Reduces compensation packages
Increases unemployment and uninsurance

24. What Do We Get for What We Spend?
We spend 33% more than Canada, our nearest competitor on costs
We do not have more doctors or nurses or hospital days
We do have more MRIs and get more tests-many unnecessary
We rank lowest of English speaking countries on patient satisfaction and access and on the doctor-patient relationship
We rank well only on access to specialists and non-urgent care! Is this most important?

25. Health Care Costs and Profit Margins
Source: Cowan CA, McDonnell PA, Levit KR, Zezza MA. Burden of health care costs: businesses, households and governments. Health Care Financing Review. 2004

26. Projections by 2015 Can Employers Really Afford It?
2015 rates:
15%-$29,128
12%-$22,362;
10%-$18,675;
8%-$15,544
Cost per employee per year
Comparing Healthcare trend figures at compounded rates: 15%,12%,10% and 8% over a 10 year period. Starting point $7,200 or approximately $600 PEPM.

27. 2005 Trends 9.2 % increase in premiums
Previous years 2000 – 2004 – 14%
Smallest employers (under 200) hit with highest increases across all sectors – 15%
Manufacturing sector hit with highest increases – 11.2 %; healthcare and transportation the least at less than 8%

28. Reaction to Premium Increases
For Employers
Cost shifting to employees
Cost sharing in premiums
Increase co-pays and deductibles
Reduce coverage
Drop Insurance
Employee Response
Pay the Increase
Drop Coverage

29. 2005 Status of Employer Coverage
60% of employers offer insurance, down from 69% in 2000
98% for firms greater than 200
93% for firms between 50 – 199
87% for firms between 25 – 49
72% for firms between 10 – 24
47% for firms between 3 - 9
Large ers get great prices and programs from national health plans bec they have 10s of thousands of lives.
Sm to mid size market is 40 mill
Average NFIB member has 10 ees; this market extremely sensitive to price; primary concern is risk selection
Sl incr in offering in small firms
80% of ees in small firms (<100 ees) have no plan choice;½ of companies w/<200 ees offer one health plan; 25% offer 2.
40% of ees in firms w/ < 100 ees get ins thru er; 83% of theose in firms w/ > 1000 ees get hlth ins there

30. The Small Employer
Firms with less than 20 employees make up 89% of American business and 19% of the working population.
Firms with 20 – 499 employees make up 10% of businesses and represent 33% of the working population

31. Who Provides Coverage & Who Doesn’t
Firms with higher wages where 65% or more of workers earn $20,000 or greater have higher coverage rates than where the majority earn $20,000 or less annually.
Nearly 50% of employers not offering health benefits, pay annual wages of less than $15,000 per year to 40 percent or more of their employees, compared to 13 percent of companies that do offer health benefits.
There are a greater proportion of part-time workers in smaller firms who do not offer benefits.
The demographics reflect a larger proportion of females, workers under age 30, and minority employees.
65 percent of those small employers’ not offering benefits have annual gross revenues that are less than $500,000, 65 percent. For employers with $1,000,000 in gross revenues or more, only 18 percent do not offer benefits.
Firms in business less than five years are less likely to offer benefits.

32. Hidden Costs of Insurance
Employee Retirement Income Security Act of Federal governs self-funded plans; states oversee fully insured plans.
Rules, regulations and offerings differ from state to state
Variables
Risk Rating & Underwriting – Some less fair than others
Administrative Costs – can be as high as 40% of premium

33. WHAT DO YOU THINK?

34. What is good public policy to promote adequate coverage & access for all?
Is there a level of health services that everyone should be guaranteed?
Should it be heavily subsidized by government and employers?
Should individuals who can afford to be allowed to "buy up?"

35. Should we work toward financial equity (justice/fairness)?
What does pluralism mean in healthcare? Pluralism that meets the needs of individuals for the kind of care and setting that is appropriate to them? Pluralism in funding streams?
Do we need to ration healthcare? How should it be done?

36. WHAT DO OTHERS THINK?

37. Voices from Communities…
“The measure of a health care system is how it cares for the have-nots.” CEO, Community Health Center, California
“Will the majority of the voting public support giving something up to get everyone covered?” Psychologist, Mississippi
“Are we willing to ration for ourselves? When we get sick, we want everything available.” Physician representative of the White House
“More people realize now [than in the early 90s] that the uninsured represent a threat to all of us.” Physician Leader, NH

38. Harris-Commonwealth Fund Opinion Leaders Survey
Covering the uninsured should be Congress’ top priority over the next 5 years
The proportion of Americans without health insurance (currently 18% under 65) should be reduced by half to about 8% in 10 years.

39. The Citizens’ Health Care Working Group
Charged by Congress with engaging the public in a dialogue on healthcare
What healthcare benefits and services should be provided?
How does the American public want healthcare delivered?
How should healthcare coverage be financed?
What trade-offs is the public willing to make?
Recommendations and an action plan will be presented to Congress

40. What Does the Public Think?
95% thinks the US healthcare system is in a state of crisis or has major problems
>90% believe it should be public policy that all Americans have affordable health care coverage
~90% think it would be better to provide a defined level of services for everyone, rather than providing coverage for particular groups of people as it is now (elderly, poor, employees)

41. What Does the Public Think?
>60% believe the most important reason to have health insurance is to pay for high medical costs
~30% believe the most important reason to have health insurance is to pay for everyday medical expenses
~74% believe everyone should be required to enroll in basic health coverage, either public or private

42. What Does the Public Think?
~ 69% think some people should be responsible for paying more than others
Criteria varied: Income most popular response; health behaviors also quite high
Should public policy continue to use tax laws to encourage employer-based health insurance?
Yes 47.9% ( )
No 52.1% ( )

43. What Does the Public Think?
Guaranteeing all Americans have health insurance was cited as the number 1 spending priority in nearly all communities
Guaranteeing all Americans get healthcare when they need it through public “safety net” programs, (if they cannot afford it) also ranked quite high in most places

44. What Does the Public Think?
REACTION TO PROPOSALS TO ADDRESS UNINSURED:
Not Popular:
Offer uninsured Americans income tax deductions, tax credits or other financial assistance to help them purchase private insurance:
Rely on free market competition among doctors, hospitals, other healthcare providers and insurance companies rather than having government define benefits and set prices

45. What Does the Public Think?
REACTION TO PROPOSALS:
Mixed reactions:
Expand state government programs for low income (Medicaid, SCHIP)
Require businesses to offer health insurance to all employees
Require all Americans to enroll in basic healthcare coverage, public or private

46. What Does the Public Think?
REACTION TO PROPOSALS:
Most popular:
Create a national health insurance program, financed by tax payers, in which all Americans would get their health insurance: (1st in almost all cities)
Expand neighborhood health clinics
Open up enrollment in federal programs, e.g., Medicare or FEHBP

47. WHAT CAN BE DONE?

48. If you segment the uninsured, it is apparent that different answers are needed for different groups:
The working poor
Those temporarily uninsured between jobs
Those who can afford but do not choose to buy insurance
The young and healthy who feel it is not worth the investment for them

49. Solutions for Employers

50. Potential Solution Join a Purchasing Pool
Small employers join forces to create purchasing power and reduce individual inequities by virtue of their size
Share risks
Negotiate competitive prices
Gain access to a variety of plans
Provide affordable co-pays
Streamline and reduce administrative costs

51. Examples
COSE – Council of Smaller Enterprises, part of Cleveland Chamber of Commerce
Assume role of purchaser
At least three health plan alternatives
Health Pass – New York Business Group on Health – for employers with less than 50 workers
28 benefit plan designs
Provides consulting services
Handles all administrative duties
PacAdvantage – California – Pacific Business Group on Health – 2 – 50 employees

52. Community and Private Sector Partnerships
Muskegon County, Michigan – for those businesses with median hourly wage of $11.50 or less and have not offered any coverage in previous 12 months
County pays 1/3; employer pays 1/3; employee pays 1/3
Plans offered are ½ of cost if employer sought plan as an individual employer
New Mexico Health Insurance Alliance

53. Another (But Risky) Solution – Self Insurance
Financial strategy used primarily by large employers – employer assumes all or part of risks
Sets funds aside to pay claims as they come in (Vs paying an insurance company a premium) - actors out administrative costs
Exempts the company from state mandates that can be costly and cumbersome for employers who operate in multiple states
Increase risk for small firm – one catastrophic medical case could be devastating
Purchase Stop Loss Insurance to cover any individual’s medical expenses higher than $25,000

54. Latest Health Plan Solution Consumer Directed Health Plans
High Deductibles
HSAs
Requirements
Learn to manage an HSA
Learn to be a savvy medical consumer
Learn to lead a healthier life

55. Employer Costs for Poor Health R. Goetzel, JOEM, Jan. 2001
Reduced Productivity: Poor Results; Reduced Co-Worker Morale; Training for Replacement
Impact on Competitiveness: Higher % of Profits for Healthcare; Increased Insurance Premiums; Increased Training and Overtime Costs; Risk Management and Safety Costs
Total = $9,992

56. Trends in Health Status - CDC
In 10 years
Obesity increased 61%
Diabetes increased 49%
Serious smoking related illness affects 8.6 million Americans
$92 billion in lost productivity annually
$75.5 billion in medical expenditures

57. Less Healthy People – Huge Costs

58. Determinants of Healthcare Costs
Source: Center for Disease Control and Prevention

59. Statistically….For Every 100 Employees
64 are overweight
25 have high blood pressure
18 or more have high cholesterol
6 have diagnosed diabetes
4 have undiagnosed diabetes
16 smoke
8 are heavy drinkers
29 don’t wear safety belts regularly
50 sit all day to do their work
21 have cardiovascular disease
Source: Wellness Council of America 2005

60. Strategies to Integrate Benefits and Work Site Health Management
WEYCO Inc. - service company for benefit plans and management Employees
Healthcare – eating the bottom line
Employers give employees an unrestricted medical card
Employees are making unilateral lifestyle decisions that affect the bottom line and other employees’ paycheck

61. WEYCO, Inc.
Health plans do not emphasize prevention, personal health improvement and compliance
Little or no employee involvement in cost
Plan Strategy
Align plan with Weyco health strategy
Involve employees and families in prevention
Move to qualified high deductible plans with health savings accounts (HSA) by 2007

62. WEYCO, Inc.
Health Strategy – As important as customer service, quality, & safety
Personal health improvement
Reduce demand to reduce costs
Eliminate lifestyles that create risk
Illegal drugs and tobacco
Excess use of alcohol
Unhealthy eating
Physical inactivity

63. WEYCO Inc. Worksite Programs HRA & Biometrics
Health Education: Cardio, Strength & Flexibility, Weight Management, Stress Management
Web-based info & Telephonic Health Coach
Physical Evaluations
Screenings

64. WEYCO Inc.
Incentives
Employer contributions/credits for participation in preventive exams, personal evaluation, physical evaluation
Credits used to reduce employee contributions to plan. Employee pays if chooses not to participate.
Preventive Exams at 100% - Health Credits if exams are completed & verified by 12/31 of each year
If employee waives coverage, WEYCO provides $ in an HRA if employee provide proof of other medical coverage

65. WEYCO Policy Tobacco-Free Program
Stop hiring or retaining tobacco users
Ban the use of tobacco on property
Tobacco assessments and voluntary testing
Company sponsored smoking cessation programs
Mandatory testing
Random testing for all employees
Extend program to spouses

66. Recent State & Federal Efforts

67. S. 1955: Health Insurance Marketplace Modernization and Affordability Act of 2005
A bill to amend title I of the Employee Retirement Security Act of 1974 and the Public Health Service Act to expand health care access and reduce costs through the creation of small business health plans and through modernization of the health insurance marketplace
Introduced by Senator Michael Enzi (R-WY)
approved by the Senate Health, Education, Labor and Pensions (HELP) Committee

68. Critics Fears
Legislation, eliminates state jurisdiction and with it almost all state-enacted consumer protections for people buying insurance individually or through their employers
States will no longer be able to mandate coverage of benefits, services, or categories of providers for individuals, small groups, or large group
Premium rating protections, enacted by states to make small group insurance more affordable to older and sicker workers, will be set aside
Insurers will be allowed to sue states that do not comply. The bill sets a ceiling on, but no floor under, what states can do to protect insurance consumers 

69. Massachusetts Universal Health Care Coverage
Those without coverage must purchase an “affordable” plan (to be defined) or pay financial penalties
Businesses with at least 11 workers will provide insurance or pay $295 per employee per year to the state
Residents with coverage must certify their insurance status on state income tax forms, or face tax penalties
State will provide sliding-scale subsidies for people who can't afford to buy a health plan on their own

70. Observations Ability to gain consensus
Compromise may be a way to break the gridlock and logjam that exists in Washington and in states across the country
Details important to the overall acceptability of the new program
How much people will have to pay to get insurance
What will the affordable plans cover
Massachusetts precedent of agreeing to expanding coverage with Medicaid waiver program provided the building blocks of working together at state level to allow this next step

71. What About the Future??

72. Perspective of Leaders
Comprehensive proposal in the short-term unlikely…until the REAL crisis strikes…?? By 2008 or 2012 elections
To develop a long range plan, create a sense of urgency!
Healthcare industry leadership must agree that solving the problem will require compromise

73. How Can We Make Real Progress?
We need to clarify what we want to achieve long-term!
Don’t assume the federal government will solve the problems
Look to communities for solutions
Focus on health—not just healthcare
Everyone needs to be involved! Our health is too important to leave to others

74. A Vision for Patient-Centered Care
"The care we need and no less, the care we want and no more."
Albert Mulley, MD
Chief of Internal Medicine, Massachusetts General Hospital

75. Marcia L Comstock, MD MPH
COO
WRGH/FAHCL
117 Lafayette Road
Wayne, PA 19087
Phone:
Fax:

76. CA Staubach & Associates
Carol A Staubach, MPH
CA Staubach & Associates
305 E. St. Andrews Drive
Media, PA 19063
Phone: 
Fax: