News

Differing Views on the Employment Effect of Healthcare Reform

February 15

This month, TMP Worldwide continues to explore the drivers behind health reform and possible implications on employment. Below are three emerging viewpoints: how reform in the US will affect other countries, pros and cons of mandating health insurance coverage and details of the report paid for by America's Health Insurance Plans in an effort to thwart the healthcare reform legislation.

US Health Reforms Could Hit Other Countries
Gemma Newby
BBC
October 11, 2009

"Whilst public debate on US health reform concentrates on reforming the insurance industry, the larger debate over how to change a system that has profits at its heart has become obscured. Last year America spent $252bn on prescription drugs, and its people paid almost twice as much as most developed countries for their medicines."

"It is true that if the United States was to substantially decrease the generosity of payment for pharmaceuticals, the resulting decrease in innovation would effect both Americans and Europeans,' [Darius Lakdawalla] said. The underlying assumption is that countries where drug prices are controlled are benefiting from the US system."

"Some have said that US drug prices have to stay high to ensure that those in the UK can get drugs cheaper. But some researchers like Professor Donald Light think the US pharmaceutical industry is not as productive as the UK's. He said that in the UK not only does the drug industry spend less on making drugs, but it also puts more of its profit back into researching and developing new drugs than US-based firms. 'British prices fully recover more research and development per million pounds per sale than the United States."

For the full article, see: http://news.bbc.co.uk/2/hi/health/8300056.stm

Healthy Young Adult 'Invincibles' May Face Healthcare Mandate
James H. Burnett III
The Miami Herald
October 11, 2009

"Healthcare-policy experts and even the politicians debating reform measures have taken notice of the so-called ``invincibles,'' people in their late teens to mid-30s who choose to be uninsured because they're convinced that their relative youth and/or healthy lifestyles make an insurance-free life worth the gamble. That gamble has become a crucial point in the debate over healthcare reform and how to pay for it, as the proposals in Congress would mandate that everyone buy insurance or face steep penalties. Supporters of mandatory coverage, including President Barack Obama, say it's a key step in making insurance affordable for everyone."

"'Now, even if we provide these affordable options, there may be those — particularly the young and healthy — who still want to take the risk and go without coverage. . . . The problem is, such irresponsible behavior costs all the rest of us money. If there are affordable options and people still don't sign up for health insurance, it means we pay for those people's expensive emergency-room visits,' [Obama] said."

"'I haven't needed it,' says Lilavois, a 35-year-old, call-center manager from Miramar who dropped his medical insurance plan five years ago. 'I lead a healthy lifestyle. I eat a proper diet. I use herbal remedies. And I haven't been sick — not so much as a flu — for years. So why would I spend money on an insurance plan that I'm not using? It's not cost-effective.'"

For the full article, see: http://www.miamiherald.com/living/health/healthcare-reform/v-fullstory/story/1278095.html

Insurance Industry Launches Attack on Democrats' Healthcare Reform Plan
Daniel Nasaw
The Guardian
October 12, 2009

"The US health insurance industry has launched a last-minute attack on Democratic healthcare reform efforts, releasing a report late yesterday predicting that insurance premiums will rise sharply if a chief proposal becomes law." "The report predicts that under the Senate Finance Committee bill proposed by Democratic senator Max Baucus of Montana, the cost of private health insurance coverage will rise 111% in the next decade, compared to 79% if no action is taken. Taken another way, the Senate finance bill would add an extra $4,000 to the cost of an average family plan in that period, and $1,500 to the cost of the average individual plan."

"But Democrats said the report was based on a flawed reading of the Senate finance bill. It does not take into account provisions that would lower the cost of coverage, including tax credits to help people buy private insurance and lowered administrative costs, [Scott] Mulhauser said."

"The Senate finance plan received a major political boost last week, when a research arm of Congress, the Congressional Budget Office, released its own analysis predicting the proposal would lower the US budget deficit by $81bn over 10 years while extending health coverage to 94% of eligible Americans."

For the full article, see: http://www.guardian.co.uk/world/2009/oct/12/health-insurance-industry-healtcare-reform

Facts and Figures Driving the Reform Movement (http://www.healthreform.gov) - This month, Ohio, Washington, and North Carolina:

Ohio:

  • Ending the Hidden Tax — Saving You Money: Right now, providers in Ohio lose over $2.2 billion in bad debt which often gets passed along to families in the form of a hidden premium "tax".1 Health insurance reform will tackle this financial burden by improving our health care system and covering the uninsured, allowing the 171 hospitals2 and the 38,566 physicians3 in Ohio to better care for their patients.
  • Health Insurance Premium Relief: Premiums for residents of Ohio have risen 92% since 2000.4 Through health insurance reform, 531,600 to 584,800 middle class Ohio residents will be eligible for premium credits to ease the burden of these high costs.5
  • Strengthening Small Businesses: 154,600 employers in Ohio are small businesses.6 With tax credits and a health insurance exchange where they can shop for health plans, insurance coverage will become more affordable for them.
  • Reforms that Reduce Your Costs: Under health insurance reform, insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive. Insurance companies will also have to abide by yearly limits on how much they can charge for out-of-pocket expenses, helping 81,200 households in Ohio struggling under the burden of high health care expenses.7
  • Insurance Stability and Security: Health insurance reform will strengthen our system of employer-based health insurance, with an additional 125,000 people in Ohio potentially getting insurance through their work.8 Health insurance reform will also ensure that you will always have guaranteed choices of quality, affordable health insurance if you lose your job, switch jobs, move or get sick.
  • Eliminating Discrimination for Pre-Existing Conditions, Health Status or Gender: 10% of people in Ohio have diabetes9, and 28% have high blood pressure10 — two conditions that insurance companies could use as a reason to deny you health insurance. Health insurance reform will prevent insurance companies from denying coverage based on your health, and it will end discrimination that charges you more if you're sick or a woman.
  • One-Stop Shopping — Putting Families in Charge: With the new health insurance exchange, you can easily and simply compare insurance prices and health plans and decide which quality affordable option is right for you and your family. These proposals will help the 1,229,800 residents of Ohio who currently do not have health insurance to obtain needed coverage, and it will also help the 484,400 Ohio residents who currently purchase insurance in the individual insurance market.11
  • Guaranteeing Choices: The largest health insurer in Ohio holds 44% of the market, which limits the choices that you have for finding coverage.12 With a competitive public insurance option, you will have more choices and increased competition that holds insurance companies accountable.
  • Preventive Care for Better Health: 39% of Ohio residents have not had a colorectal cancer screening, and 21% of women have not had a mammogram in the past 2 years.13 By requiring health plans to cover preventive services for everyone, investing in prevention and wellness, and promoting primary care, health insurance reform will work to create a system that prevents illness and disease instead of just treating it when it's too late and costs more.
  • Improving Care for Children and Seniors: 21% of children in Ohio have not visited a dentist in the past year14, and 28% of seniors did not receive a flu vaccine15. Health reform will ensure coverage for kids' dental, vision, and hearing needs, and will promote quality coverage for America's seniors, including recommended immunizations.

Washington:

  • Ending the Hidden Tax — Saving You Money: Right now, providers in Washington lose over $663 million in bad debt which often gets passed along to families in the form of a hidden premium "tax".1 Health insurance reform will tackle this financial burden by improving our health care system and covering the uninsured, allowing the 87 hospitals2 and the 20,923 physicians3 in Washington to better care for their patients.
  • Health Insurance Premium Relief: Premiums for residents of Washington have risen 103% since 2000.4 Through health insurance reform, 602,500 to 705,300 middle class Washington residents will be eligible for premium credits to ease the burden of these high costs.5
  • Strengthening Small Businesses: 108,566 employers in Washington are small businesses.6 With tax credits and a health insurance exchange where they can shop for health plans, insurance coverage will become more affordable for them.
  • Reforms that Reduce Your Costs: Under health insurance reform, insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive. Insurance companies will also have to abide by yearly limits on how much they can charge for out-of-pocket expenses, helping 66,800 households in Washington struggling under the burden of high health care expenses.7
  • Insurance Stability and Security: Health insurance reform will strengthen our system of employer-based health insurance, with an additional 68,000 people in Washington potentially getting insurance through their work.8 Health insurance reform will also ensure that you will always have guaranteed choices of quality, affordable health insurance if you lose your job, switch jobs, move or get sick.
  • Eliminating Discrimination for Pre-Existing Conditions, Health Status or Gender: 7% of people in Washington have diabetes9, and 25% have high blood pressure10 — two conditions that insurance companies could use as a reason to deny you health insurance. Health insurance reform will prevent insurance companies from denying coverage based on your health, and it will end discrimination that charges you more if you're sick or a woman.
  • One-Stop Shopping — Putting Families in Charge: With the new health insurance exchange, you can easily and simply compare insurance prices and health plans and decide which quality affordable option is right for you and your family. These proposals will help the 741,500 residents of Washington who currently do not have health insurance to obtain needed coverage, and it will also help the 328,900 Washington residents who currently purchase insurance in the individual insurance market.11
  • Guaranteeing Choices: The largest health insurer in Washington holds 44% of the market, which limits the choices that you have for finding coverage.12 With a competitive public insurance option, you will have more choices and increased competition that holds insurance companies accountable.
  • Preventive Care for Better Health: 34% of Washington residents have not had a colorectal cancer screening, and 19% of women have not had a mammogram in the past 2 years.13 By requiring health plans to cover preventive services for everyone, investing in prevention and wellness, and promoting primary care, health insurance reform will work to create a system that prevents illness and disease instead of just treating it when it's too late and costs more.
  • Improving Care for Children and Seniors: 19% of children in Washington have not visited a dentist in the past year,14 and 28% of seniors did not receive a flu vaccine15. Health reform will ensure coverage for kids' dental, vision, and hearing needs, and will promote quality coverage for America's seniors, including recommended immunizations.

North Carolina:

  • Ending the Hidden Tax — Saving You Money: Right now, providers in North Carolina lose over $1.3 billion in bad debt which often gets passed along to families in the form of a hidden premium "tax".1 Health insurance reform will tackle this financial burden by improving our health care system and covering the uninsured, allowing the 113 hospitals2 and the 26,716 physicians3 in North Carolina to better care for their patients.
  • Health Insurance Premium Relief: Premiums for residents of North Carolina have risen 91% since 2000.4 Through health insurance reform, 1,405,200 to 1,577,800 middle class North Carolina residents will be eligible for premium credits to ease this burden.5
  • Strengthening Small Businesses: 128,153 employers in North Carolina are small businesses.6 With tax credits and a health insurance exchange where they can shop for health plans, insurance coverage will become more affordable for them.
  • Reforms that Reduce Your Costs: Under health insurance reform, insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive. Insurance companies will also have to abide by yearly limits on how much they can charge for out-of-pocket expenses, helping 63,400 households in North Carolina struggling under the burden of high health care expenses.7
  • Insurance Stability and Security: Health insurance reform will strengthen our system of employer-based health insurance, with an additional 86,500 people in North Carolina potentially getting insurance through their work.8 Health insurance reform will also ensure that you will always have guaranteed choices of quality, affordable health insurance if you lose your job, switch jobs, move or get sick.
  • Eliminating Discrimination for Pre-Existing Conditions, Health Status or Gender: 9% of people in North Carolina have diabetes9, and 29% have high blood pressure10 — two conditions that insurance companies could use as a reason to deny you health insurance. Health insurance reform will prevent insurance companies from denying coverage based on your health, and it will end discrimination that charges you more if you're sick or a woman.
  • One-Stop Shopping — Putting Families in Charge: With the new health insurance exchange, you can easily and simply compare insurance prices and health plans and decide which quality affordable option is right for you and your family. These proposals will help the 1,547,200 residents of North Carolina who currently do not have health insurance to obtain needed coverage, and it will also help the 435,800 North Carolina residents who currently purchase insurance in the individual insurance market.11
  • Guaranteeing Choices: The largest health insurer in North Carolina holds 47% of the market, which limits the choices that you have for finding coverage.12 With a competitive public insurance option, you will have more choices and increased competition that holds insurance companies accountable.
  • Preventive Care for Better Health: 33% of North Carolina residents have not had a colorectal cancer screening, and 18% of women have not had a mammogram in the past 2 years.13 By requiring health plans to cover preventive services for everyone, investing in prevention and wellness, and promoting primary care, health insurance reform will work to create a system that prevents illness and disease instead of just treating it when it's too late and costs more.
  • Improving Care for Children and Seniors: 22% of children in North Carolina have not visited a dentist in the past year,14 and 29% of seniors did not receive a flu vaccine15. Health reform will ensure coverage for kids' dental, vision, and hearing needs, and will promote quality coverage for America's seniors, including recommended immunizations.
  • 1 Hospital uncompensated care cost is estimated using a GAO model and the Hospital Cost Reports. Total uncompensated care is computed as hospital uncompensated care divided by 63% (Hadley and Holahan's study on "The Cost of Care for the Uninsured" for Kaiser in 2004 found that hospitals account for 63% of total uncompensated care). Data expressed in 2009 dollars using Centers for Medicare and Medicaid Services, "National Health Expenditure Data."
  • 2 2007 AHA Annual Survey Copyright 2009 by Health Forum LLC, an affiliate of the American Hospital Association, special data request, March 2009. Available at http://www.ahaonlinestore.com.
  • 3 American Medical Association, Physicians Professional Data, year of data 2008, copyright 2008: Special Data Request.
  • 4 Center for Financing, Access and Cost Trends, AHRQ, Medical Expenditure Panel Survey - Insurance Component, 2000, Table II.D.1. Center for Financing, Access and Cost Trends, AHRQ, Medical Expenditure Panel Survey - Insurance Component, 2006, Table X.D. Projected 2009 premiums based on Centers for Medicare and Medicaid Services, "National Health Expenditure Data."
  • 5 U.S. Census Bureau, Current Population Survey. Annual Social and Economic Supplements, March 2007 and 2008.
  • 6 Center for Financing, Access and Cost Trends, AHRQ, Medical Expenditure Panel Survey - Insurance Component, 2006, Table II.A.1a.
  • 7 Center for Financing, Access and Cost Trends, Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey, 2006.
  • 8 U.S. Census Bureau, Current Population Survey. HIA-4 Health Insurance Coverage Status and Type of Coverage by State—All Persons: 1999 to 2007, 2007. Calculations based on Congressional Budget Office. Letter to the Hon. Charles Rangel on America's Affordable Health Choices Act, July 14, 2009.
  • 9 Behavioral Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2008.
  • 10 Behavioral Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2007.
  • 11 U.S. Census Bureau, Current Population Survey. Annual Social and Economic Supplements, March 2007 and 2008.
  • 12 American Medical Association. (2008,2009). "Competition in health insurance: A comprehensive study of U.S. Markets: 2008 Update," American Medical Association.
  • 13 Behavioral Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2007.
  • 14 Child and Adolescent Health Measurement Initiative. 2007 National Survey of Children's Health, Data Resource Center for Child and Adolescent Health.
  • 15 Behavioral Risk Factor Surveillance System Survey Data. Atlanta, Georgia: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, 2007.
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