Getting to a Unified System? Is It Desirable? Will It Ever Happen?

Getting to a Unified System? Is It Desirable? Will It Ever Happen?

            I’d like to begin my last essay by thanking Clarke Cochran for an engaging three weeks of conversation.  Dr. Cochran represents what is best about dialogue concerning hard problems.  He is civil.  He is clear.  And, in what is best about Christian engagement with difficult conundrums, he presents his interlocutors’ positions with charity.  It’s been a pleasure “conversing” with him this month.  I hope we’ll have a chance to think together again about the place of Christian conviction as it relates to the American healthcare system.  Cochran is obviously an expert, and his ideas and positions are well worth reading.

            Now on to the substance.  I am confining my comments in this essay to Cochran’s first two contributions.  So, let me begin by the stating positions on which I think he and I agree.  First, I think that we agree that, by a person’s humanity, that person deserves, at a minimum, respect for their God-made creatureliness that should not be willingly destroyed by anyone, including the state.  Whether this means that the person has a right to healthcare, pressable against the state, is altogether another matter.  I’ve emphasized this point in both of my first two essays, and I won’t rehearse or extend my analysis on this point here.  Cochran wanted to move the conversation away from “rights talk” especially in his second essay.  And that’s OK.  Cochran wants to move away from what he sees as my stark position that either a person gets their healthcare needs met through one of the established channels (outlined below) OR the government provides to citizens as a matter of right.  Instead, Cochran’s proposal, as I understand it, is to have a universal-type of system that combines a mandate for coverage along with traditional employer-sponsored insurance and the existing government-sponsored programs, like Medicare (including an early option), Medicaid, and the Veterans Administration system, among others.  Perhaps I missed something, but Cochran’s proposal sounds a lot like the system we have had after March 26, 2010, the date that President Obama signed the Affordable Care Act into law (with, notably, the so-called “individual mandate” that President Trump has now gutted).

            Before I get to my main criticisms of Cochran’s plan, let me emphasize one other point on which he and I agree.  Though we differ in its expression, we both believe that justice plays a vital role in any Christian’s read of and interaction with the healthcare system.  There is a strong sense, as I view both Scripture and broader Christian theology, that justice demands the Christian do something about the tangible needs of his neighbor, regardless of whether the neighbor deserves that care.  I would say, though, that Cochran’s view of justice’s interaction with the system is more telescopic in nature, while mine is more microscopic.  What I mean is that Cochran’s view looks to engage the entire system based on his view of what justice (and his other foundational principles) require.  I am dubious that such a system-wide engagement or overhaul is possible.  While I don’t necessarily advocate for reforms only at the margins, I do not think that third-party payor-based, fee-for-service, profit-incentivized care is going away any time soon.  Simply, in at least the near-term future, I don’t think our current “system” is going away.

            So, it shouldn’t be all that surprising when I level my criticism of Cochran’s plan in a series of a few questions.  To wit: who is going to pay for this? If funding for parts of the plan come in the form of increased taxes, why does Cochran think that the current Congress would pass such a plan, the current President would sign such a plan, or the American people would support such a plan?  My guess is that, at the very least, the plank of Cochran’s plan calling for the expansion of Medicare (early entry around age 55) would call for a significant tax increase to accommodate those late-career, almost-senior citizens whose chronic and besetting health conditions make the generous slate of benefits in the Medicare program look particularly enticing.

            Cochran’s plan would necessitate the revival of one of the most controversial parts of the ACA – the “individual mandate”.  To prevent the evils of adverse selection, people who otherwise don’t care to or wouldn’t plan to buy health insurance must be made to buy health insurance.  You know the story.  Though the ACA’s individual mandate passes constitutional muster according to the Constitution’s Article I taxing power, that speaks neither to its wisdom nor its practicality.  Therefore, in a nod to popular sentiment, the Congress and President Trump killed the individual mandate as part of the 2017 tax reform package.  Simply, many Americans recoil at the idea of being forced to buy something that they don’t want to buy.  Perhaps that is borne out of the strident individualism that pulses through America.  Nevertheless, there will have to be a way to force Americans to jump into insurance pools to prevent those pools from “death spiraling” into destruction.

The “problem,” of course, with the failure of the individual mandate is that the mandatory coverage provisions found in the ACA and the mandatory treatment provisions found elsewhere in federal law (namely, the EMTALA law) remain.  So, policymakers face something of a Hobson’s choice – force Americans to buy a product that they might not want but that ultimately could be very good for them (in that it will pay for some of their healthcare needs), or not force them to buy health insurance, and then cover and/or treat them even after they get sick (the “guaranteed issue” provision of the ACA and the EMTALA law). 

            Further, does Cochran mean to keep the so-called “employer mandate” originally found in the Affordable Care Act?  The employer mandate has been an issue for some businesses ever since the ACA was enacted.  It was meant to incentivize small businesses to provide their workers employer-sponsored health insurance.  Instead, it has become a noose around some employers’ necks, with the requirement that some employers who do not provide health insurance pay a tax for every employee who must buy health insurance from an ACA exchange over a certain threshold.  Though constitutionally the tax levied pursuant to the employer mandate is not a “penalty,” practically speaking it feels like one to the small businesses whose profit is eroded by this requirement.

            These are just two of the problems that immediately come to mind when trying to wrestle with a universal-type of system like Cochran’s.  I might point out other issues if I had more time, space, and inclination.  Just one to end: any expansion of state Medicaid and/or last-ditch safety-net programs will have to reckon with the problem found in the ACA Medicaid expansion.  Medicaid is what we constitutional law professors like to call a program of “cooperative federalism”.  Basically, it is a partnership between the federal government and the state governments.  The federal government pays anywhere from 50% to over three-quarters of a state’s Medicaid budget, and the state government kicks in the rest.  We remember from the Supreme Court fights over Medicaid expansion that the main constitutional problem is that the federal government cannot force a state to take more Medicaid money or else lose all its federal Medicaid funding.  This was the “gun to the head,” in which state governments were told to expand their Medicaid programs to include 100% of all low-income people whose income fell below a certain threshold OR lose all the federal government’s contribution to their Medicaid program.  The Supreme Court ruled that this amounted to economic extortion and was deemed unconstitutional.

            You might also remember that there was a “sweetener” attached to entice states to expand their Medicaid programs – the federal government would pay for the entire expansion for a few years, and then the states would pay for up to ten percent of the expansion thereafter.  This seemed like a “no brainer” for the states.  What state would pass up “free money,” especially if it meant providing a vital service to its citizens?  There were some states that did not expand their Medicaid programs out of principle.  In other words, the big, bad federal government was not going to tell them what to do, even if it meant passing up money for the biggest line item in their budgets.  However, there was another force at work – the expansion money was crafted in such a way that it would gradually sunset after several years.  That means that states that have expanded their Medicaid programs will eventually have to pay 100% of the expansion.  This will cause a reckoning in the states that “go all the way” with Medicaid expansion.  Once the expansion money goes away, these states will have painful choices to make about their state budgets.  Do they keep the expansion and cut other programs, or do they keep the other programs and scuttle the expansion (which will likely prove to be very popular among its beneficiaries)?  Or does the state raise taxes to fund everything in its budget, including the expansion?

            Why rehearse all of this?  Well… it seems to me that if Cochran’s plan depends, even in part, on expanding Medicaid in any sense, then the states will have some of these unintended consequences to deal with.  

While matters of mandates, taxes, costs, and execution are important problems that any person advocating a universal-type of system must overcome, the most vexing issue that Cochran and other advocates of this type of system must answer for is the lack of bona fide common purpose or esprit de corps in America that is found in other nations with a true universal system.  America is made up of over 330 million people with many different attitudes, opinions, financial situations, desires, dreams, and most importantly for our purposes, visions of the common good.  We are a huge, populous country with many ideas of what it means and what it takes to be a good American.  Our cousins across the pond in Great Britain, while diverse in ethnicities and religions, are absolutely unified in their rock-solid belief in the National Health Service (NHS).  The NHS enjoys broad approval and appeal in Great Britain, notwithstanding the queues (sometimes months-long waiting lists for certain procedures), substandard (to many Americans) facilities, and parsimonious treatment.  This attitude of acceptance has solidified over many decades since the NHS was created in devastated post-World War II Great Britain.  For many Britons, the NHS is a national institution that is part of the British national identity and thus cannot be fundamentally changed or scrapped.

Let me be clear (and hopefully fair): Cochran is not advocating for such a unified program as Britain’s NHS.  But even his “universal-type” of system in which universal coverage is the goal is met with the high ideological and attitudinal wall that is contemporary America.  Let’s be frank – in the “wilderness” that is modern American life, the opinions and beliefs about who is deserving of care and protection in the form of healthcare insurance coverage varies wildly.  Witness one example: with respect to Medicaid expansion (part of the 2010 Congress’s and President Obama’s program to cobble together a universal-type of program through the Affordable Care Act), notice the balkanization of the states.  Most of the states that rejected Medicaid expansion are in the south and are Republican-leaning.  Many states that accepted Medicaid expansion are not in the south and are more progressive.  And that involved “free” money!  If we can’t have broad agreement on freebies, what makes us think that we can have broad agreement on much of anything else?

The point is this: who really expects to craft a comprehensive healthcare plan that will be palatable to a critical mass of Americans with different goals, priorities, financial situations, and who are used to a welter of different insurances?  I find that to be a near impossible task.  Maybe I’m being fatalistic.  Maybe I’m not idealistic enough.  However, what I really think I am is realistic.  I am realistic enough to know this: the main parts of our healthcare system are fee-for-service based.  So, follow me with my hypothesis: nothing in commercial (private) FFS insurance is going to dramatically change until the Medicare program collapses.  Projections for Medicare’s collapse shift all the time, but right now, the program is scheduled to run out of money (for hospital services) in 2029 (Carolyn Y. Johnson, “Medicare’s hospital trust fund will run out of money in 2029,” Washington Post Wonkblog, July 13, 2017).  If the program runs out of money in 2029 (or threatens to do so in the year or two before D-Day), I think Congress would seriously consider shifting the program immediately to a payment model something more sustainable.  But 2029 is a long way off.  To be fair, the powers that be over the Medicare program have been trying to introduce value and outcome-based reimbursement, hoping to displace FFS (Bruce Y. Lee, “Very Profitable Nonprofit Hospitals…But Where Are Those Profits?,” Forbes, May 8, 2016).  The displacement hasn’t happened yet.  And, at the margins the federal agency that operates the Medicare program (the Centers for Medicare and Medicaid Services) introduces “demonstration projects” all the time experimenting with new payment and delivery models.  None of those demonstration projects have yet to supplant traditional “Part A” (fee-for-service hospital coverage) or “Part B” (FFS service outpatient coverage) or even “Part C” (Medicare managed care that combines in HMO, PPO, and other managed care products the benefits of Parts A and B).

But if Congress ever does change Medicare’s basic delivery and payment model, then I believe the commercial insurance market will follow.  And when it follows, that will be the confluence of factors – the crisis – for America to rebuild a truly unified healthcare delivery and payment system.  But I don’t think it will come before such an implosion.  People like their PPO plans where they can choose their own doctors.  People like the idea of going to get a $1000 MRI for a $30 co-pay.  No person likes being admitted to the hospital.  But everyone likes the idea of racking up a five or six figure bill for a hospital stay and only having to pay $100.  You get my point.  Of course, what consumers love most about excellent health insurance represents one of the troubling problems with the overall system – care costs too much and consumers don’t pay enough for it, thus incentivizing them to use more of it (as Cochran previously has noted).

My point is this: the conditions are not right for a universal-type of system.  It’s unclear whether they ever will be right.  Further, we should ask if they should be right.  We should seriously consider whether the American system (such that it is) is the best that America can do given our cultural and political polarization and Americans’ affinity and demand for (relatively) low taxes.  An observation: T.R. Reid, a former reporter for the Washington Post, wrote an interesting book a few years ago entitled The Healing of America.  In the book, Reid summarized the distinctive features of several Western democracies’ healthcare systems.  All of them were “universal” in one way or another – whether a “soft” form of a universal system by means of a substantial safety net for citizens who, for whatever reason do not have health insurance – or a “hard” form of a universal system like the British NHS version of socialized medicine.  In each of these countries the population has generally rallied in favor of the payment and delivery system.  America is bigger (by orders of magnitude than some of the countries featured in Reid’s book), it has healthcare systems, rather than one system, and its population is of a divided mind regarding the merits of collapsing the disparate systems into one, universal system.  In short, America does not have the set of conditions necessary for a universal system to succeed.  And even with the “waystation” type of system found in the Affordable Care Act has proved to be largely unsuccessful, if we go by the political polarization it has fostered.

Two Concluding Thoughts

            I want to end this essay with just one “riff” about problems I see in America’s cobbled-together system, which if fixed, might bring more access to care for Americans who do not have a ready way to get care.  I also want to offer a correction concerning a solution to a problem that I offered in my second essay.

            First, ever since I started practicing healthcare law in 2001, I have been fascinated by the EMTALA law – the law that mandates that a person cannot be turned away from receiving a “medical screening exam” or “stabilizing treatment” when that person seeks care in an emergency room.  EMTALA is complicated and it brings with it interesting fact patterns (which is important for lawyers and law professors).  For consumers, it serves as an ad hoc last line of defense for receiving healthcare.  The hospital can’t “turf” you before you receive your medical screening exam to determine if you need stabilizing treatment.

            Because emergency rooms must provide patients a modicum of evaluation and treatment, those without health insurance have come to realize that they can receive non-emergency care there.  In a comment to one of this month’s prior essays, reader Julie Kuhl concluded that this is because these patients have Medicaid for their primary insurance, and many doctors’ offices do not accept Medicaid (because of troubling low reimbursement rates).  This may be so.  Regardless of the reason, “gumming up” the emergency room with non-emergent patients makes life miserable for everyone and likely delays needed care for acute patients.

            If this is the problem that I think that it is, then Congress would do well to reconfigure the EMTALA law to allow hospitals to build and open to the public urgent care types of clinics near emergency rooms so that non-emergent patients can be diverted from the emergency room and treated there.  These urgent care clinics would be required to accept Medicaid patients (and perhaps required to accept uninsured patients or state-insured safety-net patients).  Congress might consider sweetening the reimbursement for these clinics with special subsidies, etc.  However, and without diving into the details, it’s my opinion that significant “surgery” on the EMTALA law will have to be done for this idea to come to fruition.  This is because the evaluation and treatment obligations of EMTALA are automatically triggered when a patient contacts certain parts of the hospital.  There would have to be a statutory allowance for patients to be shunted to these urgent care types of clinics.

            I will admit an obvious problem with my plan.  It really does nothing for uninsured patients who have genuine emergency conditions.  These patients will be faced with substantial, and for all practical purposes, unpayable bills related to their care in the ER (and whatever follow-up care they might require). 

            Second, my correction.  In my last essay, I surmised that an intermediate solution to the “obscenity” of the uninsured being charged “full retail” chargemaster rates would be to offer them what amounts to an a “most favored nations” clause whereby the could not be charged more than some insurance benchmark – whether Medicare, Medicaid, or commercial insurance.  Little did I know (although I should have!) that the Affordable Care Act and the administrative regulations published thereto prevents not-for-profit hospitals from charging the uninsured more than what certain forms of insurance would reimburse to the hospital.  There’s a lot more to be said about that regulation, and I won’t do it here. Dear readers, I am embarrassed that I didn’t “run to ground” this regulation before letting my second essay go.  But I’m glad you and I know about it now!  For more on this regulation, please see, Jessica Curtis, “What Does the Affordable Care Act Say About Hospital Bills?,” Community Catalyst, June 15, 2015.

Conclusion

            It’s impossible to identify all the problems in the American healthcare system in 9000+ words.  I’ve only identified a few.  I want to leave you with a summary of my positions, both theological and practical:

First and foremost, Christians have personal obligations to care for the sick.  I wonder, if in the environment we live in today, that means a Christian ought to sacrifice his/her hard-earned money for the care of his less well-off fellows?

This obligation sounds in justice and emanates from each person’s incalculable worth as a creature made in God’s image.

Just because Christians and the Church may have obligations to care for the sick does not necessarily mean that the state has similar obligations.

In America, we have besetting problems which routinely disadvantage the poor and uninsured.  I’ve identified the phenomenon of the “chargemaster” and the poor seeking primary care in the emergency room.  The federal government has addressed how the non-profit hospitals charge uninsured patients.  There are other issues that target the uninsured, to be sure.  There is a welter of other problems which do not necessarily target the poor and uninsured but which nevertheless contribute to high costs and poor access.

America’s healthcare system is really a “system of systems”: a payment system (composed of government and commercial payers and the uninsured, and many ways of paying, including HMOs, PPOs, cash payments, etc.), a delivery system, a training and education system, a technology development system, among many others. 

Unifying this system will be very challenging, if not impossible.  There will need to be a catalyst to do so.  Note, that I’m not endorsing such a catalyst.  It’s just my opinion that one will be necessary in order unify the system.

I don’t think my solutions are necessarily marginal, but I do think change to the system in which more people get more access will come by “blocking and tackling” – making one change at a time to one problem at a time.

I’m not eager to give up my “Cadillac” level PPO plan.  I’d suspect that many other conscientious Christians are unwilling to give up their excellent health benefits either.  I’d further suspect that whether Christian or not, getting those who have great health plans to give them up for something less financially protective will be one of the hardest challenges in forming a truly unified system.  I genuinely wonder if that will ever happen.

So, there you have it.  I hope I have shown some light and not thrown off too much heat.  I do believe that in all things – our living, our working, and our thinking about and advocating for change in the American healthcare system, we do so under God’s kind superintendence, and thankfully, His mercy and grace.  May God have mercy on me, a sinner, as I have offered my thoughts, for I know I’m in desperate need of it!