Regardless of who wins the White House, healthcare policy will be prominent in the next administration. The industry is America’s biggest employer (17.5 million), its biggest and fastest growing expense (18% of Gross Domestic Product) and the biggest contributor to the nation’s staggering $26.9 trillion federal debt.
In Thursday’s debate, the opening segment on the pandemic surfaced contrasting views about its handling. According to polls, it’s the issue of most consequence to voters this year:
MANAGING THE PANDEMIC
President Trump
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‘The pandemic was unavoidable. China caused it.’
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‘The U.S. response is a success. We’re turning the corner”
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Core strategy: $12 billion investment in Warp Speed vaccine development program, limited use of the Defense Production Act to build supplies (PPE, ventilators, et al) and assign responsibility to states for lock-downs, contact tracing, mask-requirement, and social distancing.
Vice President Biden
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‘The coronavirus was predictable. We had warnings. We were not prepared’
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‘The U.S. response is a failure. We’re heading into a dark winter’
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Core strategy: Invest $25 billion in vaccine development, federalize the Covid response, provide free testing, hire 100,000 contact tracers via job corps and ‘listen to the scientists.’
Polling by Gallup indicates 77% of adults consider this election the most consequential to America’s future in recent history. The pandemic has drawn attention to the adequacy of our public health programs, the importance of pandemic preparedness and the vulnerability of those at highest risk in our health system—the elderly, those with chronic diseases and low-income populations. It has also thrust issues like pre-existing conditions and the loss of employer-sponsored health insurance into the spotlight.
Health policy is foundational to our economy and social wellbeing. So, understanding the differences between the health policies proposed by each campaign is necessary for everyone, not just those of us who make our livelihood in the industry. In this election, they are rooted in two contrasting sets of Core Tenets about the role the health system plays in our democracy and corresponding views about the strengths and weaknesses each campaign sees in the status quo. Here’s a distillation extrapolated from public documents available from both campaigns:
NOTABLE STRENGTHS AND WEAKNESSES OF THE CURRENT SYSTEM
President Trump
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Strengths: Private sector innovation, quality of care
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Weaknesses: Lack of transparency, inefficiency, and waste; over-regulation
Vice President Biden
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Strengths: Clinical quality, science
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Weaknesses: Uneven access (disparity), affordability, inadequate funding for public health
THE CORE TENETS UNDERLYING HEALTH POLICY PLANS
President Trump
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Healthcare is a personal choice.
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The private sector should lead.
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The Affordable Care Act is fundamentally flawed & should be replaced.
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Federalism: states should have more latitude in setting health policies.
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Increased competition in healthcare is necessary to improving its performance. Price transparency for drugs and hospital services will drive consumer choices and reduce costs.
Vice President Biden
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Healthcare is a fundamental right. Universal coverage is the goal.
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The federal government should lead.
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The Affordable Care Act is suitable framework but needs improvement (aka BidenCare).
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Public health is a priority. It’s underfunded and ignored.
Based on their Core Tenets and Strength-Weakness assessments, each campaign has advanced policies reflecting their intentions to improve the health system’s performance. Here’s a recap:
POLICIES/STRATEGIES TO INCREASE ACCESS TO HEALTH INSURANCE COVERAGE
President Trump
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Encourage Medicaid innovation in states vis a vis block grants and waivers.
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Relieve ACA regulatory constraints on private health insurers i.e. “essential health benefits” (State Relief and Empowerment Waivers)
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Expand access to short-term plans and use of healthcare savings accounts in the individual insurance market.
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Expand coverage and services in Medicare Advantage & Medicare Part D.
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Enhance funding for services in the Indian and Veterans Health programs.
Vice President Biden
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Expand premium tax credits and expand marketplace subsidies to specified populations earning above 400% of the FPL. Also extend marketplace access to employees whose employer-sponsored coverage exceeds 9.78% of AGI.
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Creation of a public option plan (including eligible in 14 non-expansion states), expand Medicaid eligibility and increase subsidies for low income households to purchase coverage.
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Set caps on individual insurance premium contribution at 8.5% of income and eliminate the subsidy cliff.
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Lower the age of Medicare eligibility to 60.
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Eliminate Trump administration allowances for short-term individual plans.
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Reverse the “public charge” rule, expanding ACA coverage to Deferred Action for Childhood. Arrivals, (DACA) recipients and allow undocumented immigrants to purchase unsubsidized plans in the ACA Marketplaces.
POLICIES/STRATEGIES TO REDUCE HEALTH COSTS
President Trump
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Ban surprise medical bills.
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Increase use of generic drugs and access to orphan drugs, (Executive Orders 13937, 13939)
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Allow drug importation with safeguards (Executive Order13948)
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Allow Medicare to negotiate drug prices with manufacturers based on international reference pricing.
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Ban or scale back Certificate of Need laws to stimulate competition.
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Implement hospital price transparency rule for 300 shoppable services.
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Allow consumers access to their medical records.
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Simplify/streamline quality reporting requirements for hospitals and other providers.
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Accelerate the use of value-based programs in Medicare, Medicaid, and rural health (EO 13941).
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Enforce the “public charge” rule restricting entry of immigrants who are likely to use Medicaid and other public programs.
Vice President Biden
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Ban surprise medical bills.
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Accelerate alternative payment models & shared risk arrangements between payers & providers to shift incentives from volume to value.
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Allow Medicare to negotiate drug prices directly with manufacturers.
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Create a drug pricing board to approve prices for specialty drugs.
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Penalize drug manufacturers for drug price increases above the general inflation rate.
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Allow drug importation from Canada.
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Review and limit hospital consolidation that drives costs up.
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Disallow tax exemptions for drug advertising.
POLICIES/STRATEGIES TO IMPROVE QUALITY AND SAFETY OF CARE FOR CONSUMERS
President Trump
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Allow patients to control their medical records (Patients over Paperwork).
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Implement the Right to Try Act (2017) to facilitate access to life-saving drugs.
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Expand opioid addiction treatment and mitigation programs.
Vice President Biden
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Implement the Mental Health Parity Act.
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Protect reproductive rights (Roe v Wade)
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Enhance Medicare benefits to include dental, vision and hearing.
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Implement suicide prevention program for Veterans.
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Expand opioid addiction treatment and mitigation programs including prosecution of drug manufacturers and distributors.
COSTS AND SOURCES OF FUNDING FOR EACH PLANS
President Trump
Cost: No specifics provided.
Vice President Biden
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Cost: $750 billion over 10 years primarily for expansion of subsidies
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Funding to come from partial repeal of tax cuts that reduced the effective tax rate for companies from 22% to 13% (Tax Cuts and Jobs Act 2017) and restore the 39.6% top rate for high income households.
These policies reflect vast differences in the approach to healthcare espoused by each campaign. In essence….
The Trump Administration’s Plan is a bet on a private-sector, driven market-driven future for U.S. healthcare in which transparency, competition and regulatory relief are keys. It’s advantageous to healthy individuals and well-capitalized organizations in the short-term, and problematic to others. TrumpCare is premised on the need for a fresh start in tandem with a Supreme Court ruling that invalidates the Affordable Care Act.
The Biden Plan is a bet on a federal government led transformation wherein gaps in access and coverage are priorities and public insurance (Medicare, Medicaid, Public Option, Marketplace Plans) key levers of change. It’s advantageous for those with health problems, the uninsured and providers of primary and preventive health services but problematic in the short term due to its cost. Thus, BidenCare builds on the Affordable Care Act expanding access to health insurance coverage while adding protections against systemic inequity and disparity that limit access.
MY TAKE
Regardless of who wins next week, healthcare policy will be prominent in the next administration. The differences in the two platforms are stark and profound, especially if economic recovery from the pandemic stalls late into 2021.
Neither plan is perfect. Both require changes that threaten their opponents. Both face huge obstacles in building a consensus among voters and support in Congress. And each is complicated by the lingering cost and social impact of the pandemic.
This is a Change Election. It has boiled down to a choice between two unique candidates whose experiences and public persona could not be more different.
Most voters will cast their ballot based on which candidate they think best suited to lead the country forward. All are aware the fate of the Affordable Care Act is a major factor in both plans. Most pay attention to a specific element in the plan they like or dislike. And a few will study the health policy agendas in full, deciphering differences, intended and unintended consequences and then vote accordingly.
Health policy is on the ballot next week. The stakes for all of us are huge.
Paul
RESOURCES
“Executive Order on An America-First Healthcare Plan”; September 24, 2020; The White House
“Reforming America’s Healthcare System Through Choice and Competition” U.S. Department of Health and Human Services
The Biden Plan to Protect and Build on the Affordable Care Act
“Economic Research: U.S. Election: Promises, Policy, And The Potential Effects On The Economy And Corporate Credit” October 19, 2020; S&P Global Ratings
“More Voters Than in Prior Years Say Election Outcome Matters”; October 19, 2020; Gallup
Sumit D. Agarwal, Benjamin D. Sommers “Insurance Coverage after Job Loss — The Importance of the ACA during the Covid-Associated Recession” October 22nd, 2020; New England Journal of Medicine
Oberlander et al “Can the Elections End the Health Reform Stalemate?” October 22, 2020; New England Journal of Medicine
ELECTION NEWS
Young Voters Prefer Biden over Trump but Historic Low Turnout an Issue
Findings from Survey Monkey’ analysis of 640,328 likely voters surveyed nationally in multiple waves from June through last week:
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Younger voters support Biden over Trump in most states: There are only five states where under-35 voters favor President Trump— Arkansas, Idaho, South Dakota, West Virginia, and Wyoming.
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Younger voters strongly supported Biden over Trump in traditionally red states including Texas (59%-40%), Georgia (60%-39%) and even deep-red South Carolina (56%-43%)
“SurveyMonkey poll: Young voters’ red-state blue wall”; October 21,2020; Axios
CORONAVIRUS NEWS
Peterson/KFF: Covid 3rd Leading Cause of Death in U.S.—Higher Proportionately than Other Developed Nations
COVID-19 deaths in the United States have surpassed 224,000 and the coronavirus is now the third leading cause of death in this country, after heart disease and cancer. Before the pandemic, the U.S. already had the highest overall mortality rate among similarly large and wealthy countries, and the gap has widened in the last few decades. Highlights:
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COVID-19 ranks as the third highest in only one peer country, Belgium.
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In several peer countries (Australia, Austria, Germany, and Japan), COVID-19 is not close to breaking into the top 10 leading causes of death. Further, the U.S. nears the top of the list of countries most affected by COVID-19 on a per capita basis, surpassed only by Belgium and the United Kingdom.
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On a per capita basis, excess deaths this year are highest in the U.S. and the U.K.
“The pandemic’s effect on the widening gap in mortality rate between the U.S. and peer countries”; October 21st, 2020; Peterson KFF Health System Tracker
CMS: 4 in 10 Seniors Unable to Get Routine Care During Pandemic
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21% of beneficiaries reported needing health care for something other than COVID-19, but not getting it because of the pandemic
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The most commonly reported type of foregone care was dental care (43%) followed by regular check-up (36%).
“COVID-19 Experiences Among the Medicare Population”; Summer 2020; CMS.gov
Final Report: Remdesivir Effective in Reducing Hospitalization
Researchers conducted a double-blind, randomized, placebo-controlled trial of intravenous remdesivir. The primary outcome was the time to recovery, defined by either discharge from the hospital or hospitalization for infection-control purposes only. Results:
A total of 1062 patients underwent randomization (with 541 assigned to remdesivir and 521 to placebo). Those who received remdesivir had a median recovery time of 10 days as compared with 15 days among those who received placebo. patients who received remdesivir (24.6%) and in 163 of the 516 patients who received placebo (31.6%).
“Our data show that remdesivir was superior to placebo in shortening the time to recovery in adults who were hospitalized with Covid-19 and had evidence of lower respiratory tract infection. “
Beigel et al “Remdesivir for the Treatment of Covid-19 — Final Report”; October 22, 2020; New England Journal of Medicine
Columbia Study: U.S. Pandemic Death Rate Highest among High Income Countries; 130,000 Lives Unnecessarily Lost
Columbia researchers examined the U.S. mortality rates for high income countries: Highlights:
The U.S. death rate per 100,000 is 66.33 vs. 49.33 in France, 25.95 in Canada, 11.72 in Germany, 3.56 in Australia, 1.31 in Japan and .85 in South Korea. “Through comparative analysis and applying proportional mortality rates, we estimate that at least 130,000 deaths and perhaps as many as 210,000 could have been avoided with earlier policy interventions and more robust federal coordination and leadership.”
Irwin Redlener, MD; Jeffrey D. Sachs, PhD; Sean Hansen, MPA; Nathaniel Hupert, MD, MPH “130,000 – 210,000 Avoidable COVID-19 Deaths – and Counting – in the U.S.” National Center for Disaster Preparedness, Columbia University; October 21, 2020
INDUSTRY NEWS
Study: Utilization Higher in Commercial Plan than Medicaid-Specific MCO’s
Researchers compared utilization between Medicaid managed care enrollees vs. enrollees in a commercial plan from 2009 to 2013. Findings:
“We found that enrollees randomly assigned to a commercial plan had 22% more outpatient visits than those assigned to the Medicaid-focused plan…. associated with a 61% increase in the use of specialty care visits.”
Note: Managed care is the dominant method for financing and delivering services in the Medicaid program, with more than 71 million individuals (74% of all Medicaid beneficiaries) enrolled in a managed care plan in 2016
Swaminathan et al “Association of Medicaid-Focused or Commercial Medicaid Managed Care Plan Type With Outpatient and Acute Care”; October 19th, 2020; JAMA Network
Study: Screening for Social Determinants Suboptimal
In a cross-sectional study of US hospitals and physician practices, 24% of hospitals and 16% of physician practices reported screening for food insecurity, housing instability, utility needs, transportation needs, and interpersonal violence. Federally qualified health centers and physician practices participating in bundled payments, primary care improvement models, and Medicaid accountable care organizations screened more than other hospitals, and academic medical centers screened more than other practices.
Fraze et al “Prevalence of Screening for Food Insecurity, Housing Instability, Utility Needs, Transportation Needs, and Interpersonal Violence by US Physician Practices and Hospitals” September 18th, 2020; JAMA Network
