An Overview of Exchanges under the House and Senate Bill

On January 8th, 2010, the Alliance for Health Reform and The Commonwealth Fund  co-sponsored and moderated a panel discussion on the health insurance exchanges that are being proposed in both the House and the Senate health reform bills. The panel consisted of Washington and Lee professor Timothy Jost, John Kingsdale of the Massachusetts Commonwealth Health Insurance Connector Authority, and Philip Vogel of the Connecticut Business and Industry Association (CBIA), which runs the non-profit CBIA Health Connections, a health insurance exchange for the state of Connecticut.

The co-sponsors have uploaded all of the event’s materials, including a webcast of the entire event, as well as all of the powerpoint slides and papers. All of this information can be found here.

Professor Jost and the Commonwealth fund created detailed charts comparing the differences between the two bills. Below is a reproduction of Professor Jost’s chart, which can be viewed by clicking on the thumbnails.

Both the House and the Senate bills would create new health insurance exchanges that would help consumers and employers navigate the purchase of health insurance. Though the common thread of a regulated marketplace runs through both bills, all three panelists noted the stark difference in the vision and implementation of the exchanges under the respective bills.

Below are some of the key distinctions between the two bills.

The House Bill — Public Option with Opt-Out Possibility

The House’s bill, H.R. 3962 (click here for entire pdf) provides for a federal exchange that would essentially eliminate the individual marketplace for health insurance going forward. A public plan would be offered that would reimburse providers at negotiated rates between those of Medicare and commercial rates. The applicable section of the House’s bill is Title III, entitled Health Insurance Exchange and Related Provisions.

Title III of the House Bill would create the Health Choices Administration with a Commissioner who would oversee the exchange. Citing Section 301 and 308 of the Bill, Professor Jost notes on page 17 of his paper:

The exchange operates at the national level, established within a new Health Choices Administration. The Commissioner of the HCA can, however, permit individual states or groups of states to administer an exchange within their territory in place of the national exchange if specific requirements are met, subject to revocation if the state ceases to meet the requirements of the bill. Even if the HCA delegates exchange authority to a state, the Commissioner retains enforcement authority and can further specify functions retained by the Commissioner and not delegated.

Thus, the House’s bill would create an exchange system that is fairly centralized and regulated, but with added flexibility. If the states fail to implement their own exchange then HHS will implement an exchange for them. Only those policies considered “grandfathered” could be sold outside of the exchange, and such “grandfathering” can only occur in the individual market. (See Section 202). Insurance offered inside the exchange would fit into one of four tiers: basic, enhanced, premium, and premium plus. (See Section 303). These tiers would correspond to different actuarial values of the plans. Subsidies would be provided on a sliding scale that is determined by the purchaser’s income.

The House bill would also limit the medical loss ratio of plans offered in the exchanges to 85 percent, largely prohibit the rescission of contracts, eliminate lifetime coverage limits, eliminate pre-existing condition exclusions, as well as require guaranteed issue and renewal of plans. Variations in premiums based on the age of the insured could only vary by a maximum of 2:1.

Not all of the panelists agreed with every provision. For example, Mr. Vogel took issue with the dependence on the medical loss ratio in regulating the market, instead arguing for a greater reliance on the “claim dollar” as a guide post.

Whether offered inside the exchange or grandfathered, all plans must meet certain requirements in terms of essential benefits, which would be determined by HHS, and would be based on the recommendation of the Health Benefits Advisory Committee–a public/private hybrid entity.

• Click here to jump to section 223 outlining the Health Benefits Advisory Committee

These benefits would include hospitalization, outpatient care, prescriptions drugs, equipment, and a host of other benefits.

• Click here to jump to the section 222 which details the essential benefits.

The House bill would also impose rules regarding the transparency of the plans offered in the exchange by requiring certain information about the plans to be disclosed.

The Senate Approach — No Public Option; Multistate Substitute Would Exist

For whatever reason, the Senate crafted a more complicated framework of exchanges.

A crucial point of divergence from the House bill is the Senate bill’s lack of a federally financed public plan offered through the exchange. However, as discussed below, part of the Senate plan attempts to act as a substitute. Another area of divergence is that existing individual and group plans may continue alongside newly created exchanges, in addition to any grandfathered plans. This is in stark distinction to the House bill that would eliminate some existing policies. Though as noted, the House bill would allow for some grandfathering.

The Senate’s exchange framework is based on section 1001 of the bill which provides that HHS will, with the help of the National Association of Insurance Commissioners (NAIC), craft standards regarding the minimum benefits and other aspects of the plans sold through the various exchanges.

In terms of the Senate’s framework for exchanges, it is as follows. The Senate bill will allow for a number of exchanges that would exist on variety of different governmental levels. Whereas the House bill envisions a more federal exchange system, the Senate bill would instead allow for state-based exchanges, multistate exchanges (i.e. regional), or substate exchanges.

• Click here for a pdf version of Senate bill, as passed.

State-based Exchanges
For the individual and the small group markets, the Senate bill would require each state to create a American Health Benefit Exchange for individual purchasers of insurance, and a Small Business Health Options Program (SHOP) for small businesses purchasers. HHS would regulate these exchanges (See section 1321(a)(1)). These exchanges would be governed by regulations promulgated by HHS, unless the states adopt alternative standards that the HHS finds acceptable.

The state may combine the individual market exchanges with the small business (SHOP) exchanges. Additionally, states have the flexibility to establish regional exchanges or smaller subsidiary exchanges that target specific geographic areas within the state. (See Section 1311(f)). If the states do not create a system of either separate exchanges for individuals and small business, or some combination, HHS will establish an exchange or utilize a non-profit insurer to fill the void. See 1321(c).

The multistate exchanges are important, as they may mollify those who have been touting the idea of interstate health insurance offerings as a panacea for the woes of U.S. health insurance.

Regardless of how any states’ exchange(s) plays out, many of the important provisions of the Senate’s bill such as certain minimum benefits, the ban on lifetime or annual dollar limits, the ban on rescission, and medical loss ratio requirements would apply across the landscape of exchanges.

State Opt-Out Possible
Under the Senate bill, the states would be eligible in 2017 to opt-out of the federal requirements listed above if they can demonstrate that they are providing affordable coverage that is at least as affordable and comprehensive as the Bill requires. Alternatively, the state may be allowed to create a “public health plan” for those under 200% of the federal poverty level. Under this arrangement, the federal government would compensate the state for 95 percent of what would have been provided through premium tax credits as well as cost-sharing reduction payments. (See Section 1331).

Multistate plans: A Compromise?
One major amendment passed on December 24th was section 1334 which amended section 1333 which dealt with multistate exchanges. Under section 1334, The Office of Personnel Management (OPM)–the agency that governs the federal employees health benefit program (FEHB)–will enter into contracts with insurance carriers to offer at least 2 multistate plans through each exchange in each state. (See 1334(a)(1)). These plans will cover the individual and small group market. At least one of those plans must be a non-profit insurance plan, and must be in accordance with the general standards set forth for health insurance plans.

Though there would be a minimum level of benefits and protections required for all plans, the States would be entitled to offer multistate plans with more substantial benefits. However the state will have to defray the costs of the additional benefits.

Unlike the House bill which eliminates the state-based individual market, the Senate bill envisions exchanges that would co-exist with both the individual and small-group markets, and operate under the same rules. Though the Senate bill allows for flexibility, the subsidies provided by the federal government could only apply to insurance plans sold through the exchange.

One of the most important and controversial sections of the amended Senate bill is section 1334(a)(4), which specifies that, in administering the multistate plan, OPM will have the same bargaining power as they currently have for plans offered in the FEHB. Thus, OPM would be able to negotiate for a specified medical loss ratio and profit margin, as well as specified premium rates and any other terms in the “interest of the enrollees.” The goal is for these plans to be offered nationwide. Whether the OPM-run exchange will succeed is obviously yet to be determined, but some like Professor Timothy Jost are worried that the Senate’s plan to allow some plans to operate outside of the exchange complicates the federal government’s job in risk adjustment.

Maybe Instead of a Dollar We Should Send Joe Lieberman Instructions on How to Use YouTube

A little while back Senator Joseph Lieberman stated that, seemingly contrary to his prior positions, he would not–and could not– support a bill which contained a public option–nor would he join in a vote to end a filibuster against the same. Relying heavily on the underlying analysis of Tim Noah, I opined at the time that perhaps we all needed to send Joe Lieberman a dollar so that he could vote his conscience as opposed to the will of Private Insurers: that the financial constraints involved in being an Independent (i.e., little or no infrastructural help from either the Democratic or Republican Parties) meant that Senator Lieberman, if he wished to continue being Senator Lieberman, would have to curry favor among donors to finance a bid for re-election.

I also noted that Chris Dodd, by virtue of his support for a public option and health reform in general, had alienated said Private Insurers and seemingly vacated his seat as “the Senator from Aetna.” I also noted that, as one might imagine, considering the sudden advent of available Aetna money, that a man (or Senator) from Aetna’s home town seeking money (such as Mr. Lieberman) might, somewhat understandably, look to align himself with the will and desires of that money. As much as it pains me to say, my antidote–sending Joe Lieberman a dollar with the words “Public Option” written on it– did not work. Sadly, the efforts of Yale students, who took a concilliatory approach in beseeching Senator Lieberman to back health reform, have seemingly not worked either.

Since then, Mr. Lieberman has come out in opposition to the plan to allow  people from 55-64 years old to buy into Medicare. Unfortunately for Mr. Lieberman, he seems to be unaware of YouTube as a means of chronicling statements made on video. Back when he was attempting to explain his desertion of the Public Option he said (thank you Merril Goozner) this:

Convergence on Health Reform (Death of the Public Option)

Thomas (Tim) Greaney

Saint Louis University School of Law

So maybe the two parties are coming together on health reform after all.   Last night we learned that after days of “secret talks” among the “gang of ten” the Democrats have reached agreement to restructure their health care proposal.  The changes are significant:

• ditch the already-watered-down public option plan;
• create a new insurance exchange “option” for individuals and small groups consisting of a nonprofit plan as negotiated by the Office of Personnel Management;
• expand Medicare eligibility to cover uninsured individuals aged 55-64.

What does the Democrats’ “public option ultralight” compromise have  in common with Republicans’ alternative universe?  Well, consider the latter’s proposal to open interstate competition for all health insurers–a move they promise will immediately lower health care costs.   Besides being shameless attempts to offer simple solutions to complex problems, the two proposals are guilty of the same fundamental misunderstanding of health insurance. Simply put, they both ignore a critical economic truth of health insurance today: insurers require a provider network of hospitals and doctors or must have market leverage in order to negotiate for lower provider prices and for controls on excessive volume.

How, then, would a nonprofit insurer not presently competing in one of the concentrated markets succeed in putting competitive pressure on the incumbents?  As one insurance industry observer put it ,

So, Kaiser Permanente, which operates with highly organized and capital intensive networks in its markets, would now come into a state where it has no networks and offer a plan? Blue Cross of Nebraska might offer an individual and small group plan in Rhode Island? Tufts Health Plan out of Boston might offer a plan in Oregon?

Based upon what network of providers in those places where they do not now do business?

Likewise, in expanding Medicare, the Dems are taking a page out of the Republican playbook. For the last several weeks,  Senate Republicans have been loudly touting the benefits of Medicare.  By their lights, not only does the program produce unmatched (and untouchable) health care services in terms of quality of care and beneficiary satisfaction, but any cost-cutting constitutes a betrayal of our commitment to seniors.  As far as one can tell, the expansion proposal will do just that: offer the now-sacrosanct program to a few million almost-seniors.  As to the other 20 million citizens, forced to shop for insurance through an exchange flawed by inadequate competition and inadequate subsidies? Well, maybe the Democrats will borrow the rhetoric of Republican National Chairman Michael Steele: this is no time for a “government-run health-care experiment.”

Micro-Chipping (and then pulling the plug on) Grandma as part of HIT and the Public Option

I had the opportunity to speak with one of our Health Law professors from private practice the other day (some professors teach full time, others teach only part time in addition to working full time as attorneys or judges), and he had been practicing (and teaching) health law for decades. He was both amazed and incensed: at our inability as a country to have a reasonable discussion about health care; that a provision to remunerate consultations regarding end of life issues somehow turned into “pulling the plug on grandma” and “death panel” sound bites–from people who should (or do) know better; and that people somehow believe that “rationing” doesn’t exist right now in the for profit health insurance system. “They speak as though their insurance policies are unlimited. They are not. There are insurers denying coverage all the time.”

This article in the New York Times’ Prescriptions won’t make him feel any better. It regards a recent chain email which tells of the impending forced implantation of microchips into patients as part of a government sponsored health plan.

Prescriptions reports:

…fears of death-panel bureaucrats voting to euthanize elderly Americans may pale in comparison to the latest fright point: according to a widely forwarded chain e-mail, the Democrats’ health care bill would require anybody who enrolls in a new government-run health insurance plan “to have a data-receiving microchip implanted in their bodies.”

The assertion would seem to tie together policy points from both the House-passed health care measure, which would create a government insurance plan, or public option, and the economic stimulus measure earlier this year, which approved billions of dollars for health information technology.

The widely distributed email is said to have prompted House Speaker Nancy Pelosi to issue a Myth Buster fact sheet:

Myth: People who enroll in the public health insurance option will be forced under the law to have a microchip implant.

Fact: The Affordable Health Care for America Act does not have any provision requiring any person to have a microchip — or anything else –implanted on their bodies for any reason.

The Times also notes that “Ms. Pelsoi’s office also noted that “PolitiFact — the Pulitzer-prize winning Web site — labeled this claim a ‘Pants on Fire’ lie, its highest degree of untruth.”

NY State Senator Eric Schneiderman, Ian’s Law & the Insurance Company Two-Step

Interesting conversation over at WNYC on The Brian Lehrer Show: New York State Senator Eric Schneiderman (D-Manhattan/Bronx) was interviewed about legislation he and State Senator Neil Breslin (D-Delmar; Insurance Committee Chair) recently introduced called “Ian’s Law.”

Ian’s Law is meant to combat an insurer practice whereby insurers attempt to rid themselves of costly policies through a two-step process which circumvents state laws which forbid insurers from dropping policy holders because of conditions which require costly care.

The Insurance Company Two-Step, How it Works

Because insurers are forbidden by NY State law to drop individuals because of costly care, the insurer merely drops an entire class or group of people and then re-offers policies to that group– but omits coverage in the newly “re-offered” policies for the specific kinds of care which the costly care individual needs, and the insurer had formerly paid for. So… if someone has a chronic condition, which requires say… regular or  continuous skilled nursing care, the insurer just drops the entire group, and then offers everyone in that group a policy that does not include regular or continuous skilled nursing care. Voila! Pretty much everyone except the person who needs the skilled nursing care accepts and “re-applies” and the problem is solved. Two steps, no violation of the law and no more having to pay for all that costly care.

The following comes from Sen. Schneiderman’s website and describes Ian’s law and the litigation which brought the practice to light.

The bill is named for Ian Pearl, a 37-year-old man with muscular dystrophy who lost his insurance when Guardian, acting under current New York law, terminated the entire class of policies in the State  that covered Ian and others. Mr. Pearl became ventilator-dependent in 1991 and relies on a skilled nursing benefit under his insurance policy to receive care that has kept him alive since he suffered respiratory arrest.

The Pearl family charged in court that Guardian terminated the entire class of policies in New York in order to get around the fact that New York law prohibits an insurance company from dropping the policy of an individual simply because he or she needs care. An internal document from the insurer, released as a result of a legal challenge, showed that company officials justified dropping the entire line of policies statewide in order to get rid of “the few dogs”, like Ian Pearl, who were filing claims. Guardian, which denies any wrongdoing, has since settled with the Pearl family and restored Ian’s coverage.

In the interview with Brian Lehrer Senator Schneiderman said that the practice is “actually not limited to one company or one individual” and that “the litigation that Mr. Pearl brought revealed internal documents showing that they [the Insurance Co.] actually were scanning through their list of expensive patients preparing what they called “hit lists” of people who they were really trying to find a way to get rid of.” As noted in the quote above, these expensive insureds were referred to as “dogs.”

And that, in a nutshell is for profit health insurance. But I think there may be a larger lesson here as well. In many ways, this practice is not very different than the design of  “wellness incentives” substituting for pre-existing condition discrimination and penalties, a topic we covered just a little while back:

It may also be useful to consider how, in practice, “incentives” have been utilized by employers in the marketplace. By engaging in a two-step process, an employer may rather easily render a “wellness incentive” into a preexisting condition premium.

The Washington Post reports that

Valeo, an auto parts supplier, four years ago raised the deductible on an employee health plan to $2,200 from $200 for individual coverage and to $4,400 from $400 for family coverage. Then it gave employees the opportunity to reduce the deductible to its starting point by not smoking and by meeting goals for blood pressure, cholesterol and body mass index, said Robert Wade, Valeo’s director of human resources for North America.

“If they don’t comply, they end up being penalized, if you will, but we refer to it as a Healthy Rewards program,” Wade said.

And the point is this–Insurers hire the best and brightest they can find, and almost any legislation or regulation meant to protect the public from unconscionable unfairness is just one smart executive and two steps away– maybe three– from being danced around.

The House Democrats’ Health Care Plan Unveiled, Questions on Women’s Access to Health Care Remain

Last Thursday, October 29^th, House Democrats announced their bill for health care reform, the Affordable Health Care for America Act.  The House bill includes provisions such as a public option and employer mandates.  For women, the House bill has been a controversial issue; though the bill contains provisions that will expand women’s access to certain areas of health care, other areas have been neglected.

On the plus side is the bill’s prohibition of domestic violence being categorized as a pre-existing condition for health insurance purposes.  Ms. Pelosi was able to follow through on her promise to women that such a discriminative practice would be ended through the House bill.  Meanwhile, U.S. News attributes the inclusion of women’s health needs in the bill to the widespread women-led activism for health care reform.  Still, as significant aspects of women’s access to health are yet left unaddressed, some advocates wonder if we should have asked for more.

One issue of contention is that an amendment to the the bill allows for 12 years of exlcusivity for biologic drugs– some of which have been found particularly efficacious in the treatment of breast cancer. In addition to the 12 year exculsivity period, manufacturers will also be able still to engage in the process known as “evergreening,” the practice of changing a drug slightly–such as altering the time release mechanism– and thereby garnering additional periods of exclusivity. These periods of exclusivity prohibit cheaper generic versions of the drug– known as “follow-on biologics” or “biosimilars” from entering the marketplace. (To read more about the biologic exclusivity debate read here and here.) The end result would seem to point– if money matters (and when does it not?),  to a decrease in the availability of breast cancer biosimilars and thus a decrease in available efficacious treatment.  One of the bill’s sponsors, Anna Eschew of California, defends the proposal on the grounds that it does not interfere with women’s access to breast cancer treatment, and that it only curbs the ability of bio-pharmaceutical generic competitors to freely utilize the costly, extensive research and development of the original bio-pharmaceutical innovators.  Eschew believes that lesser periods of exclusivity will have a chilling effect on biologic research and development– as lesser exclusivity would make it more difficult for the original developers of the drugs to recoup the large expenses associated with such development.

Reproductive health care issues have also come to the forefront of the debate, but with a clear consensus yet to have emerged on what the bill does or does not cover within the various exchanges, options and subsidies within the bill.

While political groups are preparing to battle out these issues, one thing remains constant, women are a force that both democrats and republicans want on their side.  The House Democrats were paying attention when drafting their health plan, but the holes still left in women’s health care access might mean that women need to make themselves heard again–and this time, maybe a little louder.

Why We All Need to Send Joe Lieberman a Dollar

Senator Joe Lieberman is an Independent. As romantically autonomous as that may sound, it also means he can count on support from neither the Democratic nor Republican Parties. It takes money to maintain a Senate seat. Why is this germane to health reform? Because a) money always is; and b) Mr. Lieberman by virtue of his Independent status presumably does not have enough– and has recently announced that he will not vote for cloture (to end a filibuster) on Harry Reid’s opt-out Public Option plan. Lieberman stated: “if the bill remains what it is now, I will not be able to support a cloture motion before final passage.”

And:  “I can’t see a way in which I could vote for cloture on any bill that contained a creation of a government-operated-run insurance company.”

Hearing this, I naturally began looking at the Insurance Industry contributions to Mr. Lieberman’s coffers. I expected to find Ronald A. Williams’ picture on Lieberman’s desk. I was wrong. According to Open Secrets.org Lieberman ranked only 14th in contributions from Insurers and Health Insurers (links below). Not shabby, but not exactly prime for a Senator who represents the State of Connecticut– home to a thriving  Insurance Industry.

Why then? Tim Noah over at Slate covers the question very well in an article well worth reading. Noah posits that because Lieberman can no longer count on Party Politics, he’s attempting to curry favor among the Insurers. Noah writes:

Why would Lieberman want to sink health reform? Klein points out that in the pretty recent past, Lieberman has supported the general goal, if not the specifics, of Obamacare. But consider Lieberman’s political situation. He is no longer a Democrat. That means he no longer has a political base. In the future, he will have to rely more on constituencies and on cash. The White House suggests that Lieberman wouldn’t dare alienate voters by opposing health reform. But what’s the most cash-rich constituency in the Nutmeg State? The insurance industry, which is headquartered in Connecticut and employs 64,000 people.

At the moment, insurers probably aren’t too pleased with Connecticut’s other senator, Democrat Chris Dodd, because Dodd is a prominent advocate for the public option. As I’ve noted previously, Dodd, during the past 20 years, received $2.3 million in contributions from insurers-more than any member of the House or Senate except John McCain, R-Ariz. During that same period, Dodd collected $774,000 from health insurers, ranking second only to House Minority Leader John Boehner, R-Ohio. Lieberman, even though he’s from Connecticut, has during that same period had to settle for 14^th place in both insurance-industry contributions and health-insurance-industry contributions. Blocking the public option might allow Lieberman to displace Dodd as “the senator from Aetna.”

Noah proffers a number of other supports for his hypothesis, and makes a great deal of sense. And in the twisted world of American Political Reality, unfortunately, Lieberman’s play is an understandable one– given the desire to hang on to his Seat.  So it seems we’ve come to this: “Independence” means “in search of the highest bidder.” I don’t live in Connecticut, and there’s no accounting for electorate taste. But how ’bout this: if we all took a single dollar, wrote “Public Option” on the bill itself and sent it to Joe– maybe he could vote his conscience and heed that moral imperative I heard so much about when he was running for Vice-President. In his rebuke of Bill Clinton

He likened Clinton’s failure as a moral authority for children to the role of the entertainment industry in undermining ”the stability and integrity of the family,” observing that children are quick to perceive a ”double standard.” The word moral appears half a dozen times in the address.

I would suggest that few things can so quickly undermine the stability and integrity of the family as a lack of health care; and children are not the only ones who can perceive a double standard.

Senator Joe Lieberman

706 Hart Office Building
Washington, DC 20510
(202) 224-4041 Voice
(202) 224-9750 Fax
For TTY Call 711

One Constitution Plaza
7th Floor
Hartford, CT 06103
(860) 549-8463 Voice
(800) 225-5605 In CT
For TTY Call 711

Why Resurrect the Public Option? The Competition Canard

Dan Balz of the WaPo asks “What brought the public option back to life?” Balz argues that while “liberal advocates of the public option . . . [see] it as the holy grail of the debate . . . [f]ew experts see it that way.” While the 39+ academics and others listed at Campaign for America’s Future Health Experts Bureau may not consider the public option akin to a chalice of eternal life, most of us are comfortable calling it a key element of reform. So while Balz focuses on the chess game of Washington politics to explain the public option’s resurgence, I detect deliberative democracy at work here.

As Congressional committees have begun to specify exactly how “competition” among insurers would lower costs, they’ve realized that we need to do a lot more than up the regulatory ante and add more insurers to the mix. Rather, just as Medicare took care of elderly persons unlikely ever to be profitably covered by private insurers, a new option is needed to address the needs of impoverished or sick citizens unlikely ever to pay profitable premiums to Aetna, Cigna, and their ilk.

Why wasn’t this apparent earlier? I think that closer scrutiny for a proposal to repeal the “antitrust exemption” for insurers has led to more serious consideration of what competition can and cannot do in the health care industry. As co-blogger Tim Greaney explains, “the Supreme Court has narrowly interpreted McCarran-Ferguson requirement that only the ‘business of insurance’ is exempt; hence insurers’ actions vis a vis providers is not exempt.” Lack of antitrust enforcement–and the market competition it’s supposed to bring–can’t fully explain insurers’ failures here. Even more alarmingly, enforcing antitrust laws aggressively against insurers, while failing to balance that effort with similar scrutiny of providers, could lead to even higher health care costs. Do we really expect piecemeal antitrust enforcement, played out in fragmented and uncoordinated courts, to manage such balance? It is often the case that both providers and insurers are concentrated, powerful, and earning supracompetitive profits–whatever “supracompetitive” means in a realm so thoroughly marbled with regulation, subsidy, and barriers to entry.

Moreover, insurers are competing in many markets–but they’re doing so in ways that are socially unproductive. As I have noted before, there are effective competitive strategies that produce no (or negative) value for society as a whole. Insurers who put hurdles in front of preventive care, or scramble to drop diabetics or CHF patients, are doing just what a competitive marketplace rewards. They also exacerbate the coverage crisis that necessitates health reform in the first place.

Genuine health reform will provide incentives for insurers to do things that actually improve individual and public health–programs such as transparent physician rating, preventive and chronic care programs, and intensive data analysis to promote evidence-based medicine. Like the V.A., a public option can be ordered to do such things. Moreover, it can be required to cover the costly or unprofitable individuals that private insurers won’t touch. The government might “require” private health insurers to do the same, but I would not count on overwhelmed regulators to enforce such laws adequately.

Sadly, even when competition is exposed as an empty vessel, our language of discussing health care tends to gravitate back to it as an ideal. Fortunately, Daniel Callahan’s recent essay on the “common good” as a justification for health reform provides a richer vocabulary of evaluation. Callahan has no illusions about transforming the current debate, but his words are worth pondering:

I have not painted a hopeful picture about the common good in American health care. That simply does not seem possible. An abiding suspicion of government, a belief in the free market as an engine of prosperity (and thus, by an illogical leap, as an engine of good health care), and the majority’s fear that they may lose the benefits they already have—all this leaves little room for an embrace of the common good. Solidarity, the value behind European health-care systems, seems to me the best basis for universal care, better than justice or rights. But the sense of solidarity required for serious health-care reform cannot be wished into existence. It was the solidarity of the British people in defense of their country during World War II that afterward helped get the National Health Service off the ground in 1946: they had all been in it together during the war, and now they needed to be together in insuring health care for all. We do not have that kind of history, and it shows.

Suffering, disease, and death are our common lot. They ought to be dealt with as our common problem. It is a shame that the kind of empathy and mutual support that Adam Smith understood to be a requirement of morality have not, in our culture, been extended to health care—extended to one another in the recognition that we all have bodies that go awry and fail. Instead we are offered a consumer model, a national Walmart of medical choice where we are all sharp-eyed purchasers getting the best possible deal for ourselves. A construal of the common good as the freedom of consumers to get what they want, indifferent to the fate of others, is a cheap substitute for the real thing.

Callahan here is too pessimistic about the viability of an appeal he’s helped craft. As Catherine Arnst has argued, a moral case for health reform–as either compassion for others or self-interest properly understood–is essential in current debates. Even the most self-centered person can imagine losing a job, a spouse, or other sources of insurance. It seems paradoxical to expect the very companies that deny such coverage to offer it under government fiat. A public option is a logical response to our market–and moral–failure to separate the experience of illness from anxiety over financial ruin. As the band Muse might put it (in the closing track of their album The Resistance) “let’s start over again” — “this time we’ll get it right.” Hope springs eternal.

Public Option Faring Better Among the Public than the Republican Party

A couple of polls just released are well worth considering– prefaced perhaps by Senator Baucus’ having just said, according to Kaiser Health News, “that the Senate is unlikely to approve major health care legislation this year that includes a pure form of the controversial government-operated insurance program…” and that “it is highly unlikely Democrats could muster the 60 votes needed to overcome a GOP filibuster and pass health care legislation that includes a public option.”

‘There are various versions of the public option bandied about … [and] we’re trying to see what makes the most sense,’ Baucus said. ‘The goal is health care reform … that can get 60 votes. … I don’t know if there are 60 votes for the pure kind of” public option proponents are demanding.’

In response to reporter questions about Sen. Thomas Carper’s (D-Del.) plan–which would leave it up to the states to decide whether to establish a public plan or not (an idea said by KHN to have been “embraced” by  Sen. Chuck Schumer (D-N.Y.)), Senator Baucus replied: “That’s new, that’s interesting … We’re trying to figure out what some of the unintended consequences [of it] will be.”

According to a recent Washington Post/ ABC News poll, a rather overwhelming number of Americans find such a state by state approach–when coupled with availability to only those who lack affordable private options– more than interesting. The Washington Post reports that:

If a public plan were run by the states and available only to those who lack affordable private options, support for it jumps to 76 percent. Under those circumstances, even a majority of Republicans, 56 percent, would be in favor of it, about double their level of support without such a limitation.

As for a Public Option on a national level– without the affordability limitation– WaPo reports that

On the issue that has been perhaps the most pronounced flash point in the national debate, 57 percent of all Americans now favor a public insurance option, while 40 percent oppose it. Support has risen since mid-August, when a bare majority, 52 percent, said they favored it.

In what may well be a related note, ABC News reports that the Republican Party is experiencing some difficulties as of late:

Only 20 percent of Americans now identify themselves as Republicans, the fewest in 26 years. Just 19 percent, similarly, trust the Republicans in Congress to make the right decisions for the country’s future; even among Republicans themselves just four in 10 are confident in their own party. For comparison, 49 percent overall express this confidence in Obama, steady since August albeit well below its peak.

The Republican Party’s difficulties are shown in another result as well; in an early assessment of preference for congressional candidates in 2010, the Democrats lead by 51-39 percent.

Public Option Alternatives

The public option has had a difficult time making its way through Senate Finance Committee mark-up sessions.  In the past week, two separate proposals for including a public option in health care reform were nixed.  Rejection of the plans, one proposed by Senator Charles Schumer of New York and the other by Senator John Rockefeller of West Virginia, is said to be indicative of a further adoption of the middle-of-the-road approach.  Still, some are optimistic that because Obama has the de facto final say on health reform legislation, he will work hard to include a public option; others debate whether the President is willing to compromise the public option for overall reform.

Instead of approving of Schumer’s or Rockefeller’s proposals, the Senate Finance Committee voted to include a proposal by Senator Maria Cantwell of Washington.  Cantwell’s amendment is said to be a compromise between Democrats and Republicans on the public option.  The plan, which would be federally-funded, would be available to those individuals who earn too much to qualify for Medicaid but are below 200% of the federal poverty level.  At present, an implementation cost analysis for the plan is still unavailable, but Cantwell says that the plan, which also give states the power to negotiate down the price of insurance, would be able to cover 75% of the uninsured population.  The plan would mirror the current health care system of Washington State.

Though many important Committee members like Sen. Baucus have approved of such an amendment, others like Senator Olympia Snowe of Maine have voted against it.  Keep in mind, Snowe has been labeled “the key to health reform.”  For Snowe, a public option would only be provided in states in which 95% of the population is deemed to not have access to “affordable” insurance through an Insurance Exchange.  Senator Tom Carper of Delaware has proposed a similar plan; however, his version leaves it up to the states to decide what it deems best for its constituents.  Under Carper’s version, states would get to choose between opening up state-funded health care plans for government employees to all residents, or creating a health insurance provider or a co-op to compete with private insurance companies.

The proposals of Carper, Cantwell & Snowe have their respective positives and negatives and are subject to, and seemingly born of, the political process. They smack of compromise.

What will it take to get any one of these proposed bills passed during the full Senate vote? The ongoing divide between liberals and conservatives on the issue of providing a public competitor to private insurance companies has created a fissure which has echoed through the common landscape now for months. But we are getting close– as the NY Times  put it– “tantalizingly close,” to sweeping Health Reform.  Floor debate will ensue shortly. Predictions abound. But in the words of Lamar Alexander, the number 3 Republican in the Senate, “There is nothing predictable about the Senate floor.”

Compromise. President Lyndon B. Johnson, key to passage of both Medicare and the Civil Rights Act famously declared: “I’m a compromiser and a maneuverer. I try to get ’something.’ That’s the way our system works.” As evidenced by the two aformentioned Johnson successes, however, Johnson also knew when to expend enough political capital to make that ’something’ meaningful. I would suggest we stand at the precipice of one of those times.

Parsing “Populism” in Resistance to Reform

Today the NYT leads with a story on a growing resistance to the individual mandate to purchase health insurance. The mandate is a key part of virtually all the reform bills now being discussed. A “growing group of lawmakers are pressing for state constitutional amendments that [they believe] would outlaw” the mandate in their states. Law professors have a dim view of the effort:

“States can no more nullify a federal law like this than they could nullify the civil rights laws by adopting constitutional amendments,” said Timothy Stoltzfus Jost, a health law expert at Washington & Lee University School of Law.

Mark A. Hall, a law professor at Wake Forest who has studied the constitutionality of mandates that people buy health insurance, said, “There is no way this challenge will succeed in court,” adding that the state measures seemed more “sort of an act of defiance, a form of civil disobedience if you will.”

Even Randy E. Barnett, a Georgetown Law professor who has written about what he views as legitimate constitutional questions about health insurance mandates, seemed doubtful. “While using federal power to force individuals to buy private insurance raises serious constitutional questions, I just don’t see what these state resolutions add to the constitutional objections to this expansion of federal power,” Professor Barnett said.

What I find so depressing about the new Orval Faubuses of health care is their failure to address funding mechanisms for purchasing health that would make the mandates much less onerous. As I blogged earlier this summer, the House Tri-Committee Bill tries to shift the burden of paying for health care from the already strapped lower-middle class to wealthier citizens who have disproportionately benefited from globalization and other economic trends. At that post, attorney David S. Miller commented:

A mark-to-market tax on the publicly-traded securities of the highest-income and wealthiest individuals would achieve [even more progressivity]. This proposal would also raise significantly more revenue than the [proposed House] surtax, would not require any increase in tax rates, would affect far fewer taxpayers, and would be more in line with the consensus view that the tax base must be broadened. It would also level the playing field between wage and income earners (who are currently subject to tax at ordinary income rates on all or virtually all of their economic income) and with investors (who defer tax indefinitely on appreciation and, when taxed, pay it at reduced long-term capital gains rates).

Unfortunately, the ballyhooed Baucus Bill appears to be far less redistributive than even the House Bill (which I have criticized for failing to distinguish between the merely well-off and the truly wealthy–a very important distinction in an era of fractal inequality). The new state resistance to a mandate should be seen as less a defense of the middle class than it is a sad example of classically self-defeating resistance to equitable distribution of social benefits and burdens.

Health reform financing must rely not merely on redistribution from the healthy to the sick, but also from the rich to the rest. A just society is committed to the universal destination of human goods-–especially those essential to the preservation of human life. Perhaps we will eventually reach a point at which taxation of those at the top to provide for the care of those at the bottom truly threatens the well-being of our economy. But when “the increase in incomes of the top 1 percent of Americans from 2003 to 2005 exceed[s] the total income of the poorest 20 percent of Americans,” we’re a long way from that point on the Laffer Curve.

Because She Said So: Michelle Obama Wants Women to Stand Up for Health Care Reform

Last Friday, First Lady Michelle Obama addressed the nation’s women, asking them to mobilize in support for health care reform.  Similar to the sentiments expressed in my post last week, Obama presented health care as a woman’s issue– further stating that health care is most important to what she called the “sandwich generation,” those who have the responsibilities to care for the elderly in their family as well as the children.  Obama calls the current health care system “unacceptable,” and one that needs reform to “ensure women have opportunities that they deserve.”  Included in such opportunities for women, as the First Lady said, is the freedom and ability to care for their families.

Further complicating the situation, many women find themselves earning more than is allowed to be eligible for public insurance yet not enough to purchase private insurance.  Women are also less likely than men to secure employer-based insurance, which can be attributed to the fact that women are more likely to work part-time and have lower incomes.  Employment equality issues ring a bell?  Check out this New York Times web tool, which gives a comparative analysis on how different individuals are affected by health care reform.  It is interesting in that it shows that for women, especially those who are unmarried, the current system leaves them largely to fend for themselves in the individual market; it also shows the potential benefits of a public plan option.  As I detailed last week, the individual market in health insurance, not subject to a host of anti-discriminatory legislation and regulation, poses significant problems to women when it comes to supplying affordable and reliable insurance.

One of the biggest issues Michelle Obama seemed to have with the current system was gender rating; it continues to force women to pay much higher premiums than men in private insurance plans.  The actuarial argument, that women’s health care needs require regular preventive care (which in reality, women and men alike should be getting) is significantly undermined by the research which shows the ultimate cost benefits of preventive care–for both women and men. It seems both ironic and counter-productive that this justification is used to punish with higher premiums those who embark upon the proactive health maintenance which so many agree is both the key to ultimate health care cost control and one of the primary goals of health care reform. Hopefully, Obama’s optimism that such gender rating will be removed through the current reform process will prove true.

With so many challenges aligned against women, it is apparent that, as stated by the Congressional Joint Economic Committee, “The status-quo health insurance system is serving women poorly.” Perhaps this is why the Obama administration, in its drive to convince Americans that the issue of health care can no longer be pushed aside, is turning to women.  A smart choice, whichever way you look at it, since women as a whole are one of the groups most strongly supporting health care reform.

So what can women do to get active in the health care reform movement, as Michelle Obama asks of us?  For now, make sure you stay on top of what the language of health reform bills says about health care for women and families.  The National Women’s Law Center is a great organization to get connected to for updates and summaries of the effects of new legislation on women’s access to health.   Through the National Women’s Law Center, you can also contact your Members of Congress to let them know that you support health care reform that addresses women’s needs.  Spread the word to your mothers, daughters, sisters, and friends; tell them Michelle Obama needs our help.

Risk, Reward, and Rationality in the Health Care Debate

I agree with Andrew Koppelman’s analysis of resistance to health insurance reform. But Red America’s implacable opposition to the plans now debated in Congress has deeper ideological roots in a love of risk. As Thomas Edsall has observed, “A problem for Democrats … is the long tradition in the US of … venerating risk … and of a deep commitment to untrammeled individualism.”

Even more frustrating for Democrats, the left’s hard-won victories to reduce risk have left many people assuming that they can’t gain much from reform. Consider four “backstops” that leave many people unworried about losing insurance:

1) Bankruptcy: Republicans worked hard to water down bankruptcy protections during the Bush years. Nevertheless, these laws still protect many consumers. As health law expert Timothy S. Jost writes, “Ultimately, the federal bankruptcy code must also be seen as our federal catastrophic health care program.”

2) Medicare: Thanks to LBJ and an overwhelming Democratic majority in the 89th Congress, the elderly already have access to federal health insurance, and are wary of any coverage expansion that could drain resources from the program. Here the GOP’s anti-spending and family values wings have formed a pincer movement that has whiplashed Democrats. First, fiscal conservatives used CBO’s dubious cost estimates to demand “real savings” to pay for reform. Dreaming of bipartisanship, Obama’s technocrats seized on the Dartmouth studies to argue that up to a third of all medical spending, including Medicare, is wasted, and that reform of the delivery system could rationalize that spending. At that point the GOP’s “family values” wing associated reform with death panels, rationing, and “pulling the plug on grandma.”

3) EMTALA: Can a relatively well off person “rationally choose” to be uninsured? As Jost notes, as of 2004, “many of the uninsured are in fact reasonably well-off—8.4% are from households that earn $75,000 or more per year.” To the extent this group is calculating the costs and benefits, it’s likely counting on the Emergency Medical Treatment and Active Labor Act of 1986 (EMTALA) to force hospitals to “screen and stabilize” those who come to their emergency rooms. Of course, once you’re stabilized, the duty to care is over, but few people think very clearly about what it is like to slowly (and stably) die of cancer while the only effective treatments are too expensive to pay for.

4) Medicaid: Finally, we come to another element of the social safety net many people think they can fall back on: Medicaid. Benefits aficionados know that only the categorically eligible can rely on it. Some reform proposals would replace the “numerous statutory and regulatory pathways for establishing eligibility” with a simple income test. But for now, those among the populace who just assume that Medicaid covers all the poor may believe they would have little to gain from reform even if they did face crippling medical bills. (They’re probably also unaware of Medicaid’s pitifully low reimbursement rates–but more on that later.)

None of these so-called backstops will help everyone, all the time. But one can imagine a risk-loving, red-blooded American wanting to roll the dice on them rather than endure the type of bureaucratic assessments and applications that will gradually poke and prod the uninsured making between 133% and 400% of the poverty level toward buying their own coverage on an exchange. Indeed, under the Senate HELP Committee’s proposal, a family making 400% of the poverty level could be responsible for paying up to 12.5% of their income in premiums, for insurance that leaves them liable for paying $11,600 in out of pocket expenses. That’s a worst case scenario of paying 26% of income for health care–better than bankruptcy, but potentially tantamount to the same thing in a country where the bottom half of the population has virtually no net worth. (And that cost-sharing estimate assumes the medical component of the CPI does not increase.)

The really appealing goal of reform–a strong public option that would be part of an exchange open to all–appears to be more of a bargaining chip than a firm commitment for the Obama Administration. Strategically, if your goal is to get “something” through Congress, this makes a great deal of sense: Republicans and some waivering Democrats think a public option smacks of socialism. But as a political matter, it is draining support for reform. People can understand a public option, and building support for it might have been as decisive to Democrats’ fortunes as FDR’s reformulation of the American social contract in the 1930s. Sadly, Obama’s technocrats appear more attracted to wonk-talk like “bending the cost curve” than the forceful moral case for collective responsibility for health. Only the President can correct that course. It takes an ideology to beat an ideology.

X-Posted: Balkinization.

Catholic Doctrine and the Public Option

I claim no expertise in Catholic doctrine, nor for that matter theology; but I have studied them some in relation to law and social justice and as a matter of personal edification. Recently, I have heard of protestations within the Faith against the spectre of the Public Option and “socialized medicine” as such. Again, as I claim no expertise, I’ll just present and lend some analysis to what lies before me; I speak only for myself.

I consulted my copy of the Catechism of the Catholic Church, Second Edition (revised in accordance with the official Latin text promulgated by Pope John Paul II), Libreria Editrace Vaticana. According to the Apostolic Constitution Fidei Depositum, On the Publication of the Catechism of the Catholic Church, “The Doctrinal Value of the Text,” this Catechism is “a statement of the Church’s faith and of catholic doctrine, attested to by Sacred Scripture, the Apostolic Tradition, and the Church’s Magisterium.” The Catechism is also said to be “a sure and authentic reference text for teaching catholic doctrine and particularly for preparing local catechisms.” According to the Apostolic Letter, Laetamur Magnopere in which this Catechism of the Catholic Church is Approved and Promulgated by John Paul II, it was “prepared by an Interdicasterial Commission” presided over by then Cardinal Joseph Ratzinger.”

The Catechism

Part Three, Life in Christ, Article 3, Social Justice, Section II, “Equality and Differences Among Men.”

• 1936 On coming into the world, man is not equipped with everything he needs for developing his bodily and spiritual life. He needs others. Differences appear tied to age, physical abilities, intellectual or moral aptitudes, the benefits derived from social commerce, and the distribution of wealth.[1] The “talents” are not distributed equally.[2]

• 1937 These differences belong to God’s plan, who wills that each receive what he needs from others, and that those endowed with particular “talents” share the benefits with those who need them. These differences encourage and often oblige persons to practice generosity, kindness, and sharing of goods; they foster the mutual enrichment of cultures….

One might think that access to medical care for a sick man, regardless of “the difference” in “the distribution of wealth,” would be essential to “developing his bodily… life.” In addition, it seems plain within the text that despite (or perhaps because of) these “differences,” each should “receive what he needs from others.” There is no provision for pre-existing conditions; no provision which mandates that only the best capitalists’ health needs be met.

As for the prospect of a government constituted by the people and for the people providing en masse for these needs, it may be of some help to look to Part Three, Life in Christ, Article 3, Social Justice, Section I, “Respect for the Human Person.” This section precedes the section quoted above by about a page.

• 1930 Respect for the human person entails respect for the rights that flow from his dignity as a creature. These rights are prior to society and must be recognized by it. They are the basis of the moral legitimacy of every authority: by flouting them, or refusing to recognize them in its positive legislation, a society undermines its own moral legitimacy.[3] If it does not respect them, authority can rely only on force or violence to obtain obedience from its subjects….

If this acknowledgment of certain inherent rights precedent to social structure sounds familiar, it should: as part of the promise which is the Declaration of Independence we are told that all men “are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness” and that it is “to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.”

Importantly, according to catholic social justice doctrine, the basis for the moral authority of power (i.e. governance), and thus its legitimacy, is contingent upon its being in accord with the dignity of human beings. Therefore, the failure to reach such an accord in a society’s legislation calls to question the legitimacy of that society’s rule; the legitimacy of such rule being “undermined” in direct proportion to such failures.

As for an example of that which is required by the dignity of human beings/ legitimacy of rule, it may prove to be of some help to look again to “Equality and Differences Among Men.”

• 1938 There exist also sinful inequalities that affect millions of men and women. These are in open contradiction of the Gospel:

• Their equal dignity as persons demands that we strive for fairer and more humane conditions. Excessive economic and social disparity between individuals and peoples of the one human race is a source of scandal and militates against social justice, equity, human dignity, as well as social and international peace.[4]

I would suggest that supplying affordable access to health care to all within this country is the essence of striving for “fairer and more humane conditions.” And that respect for the dignity of mankind, upon which rests “the basis of the moral legitimacy of every authority,” not only allows for such proposals as a Public Health Care Option, but, it would seem, demands it.

---

[1] 41. Cf. GS 29 Sect. 2 (footnotes are from the text of the Catechism, but appear here renumbered due to format. The original footnote number appears immediately after this document’s footnote number-in this instance, the original is “41.”

[2] 42. Cf. Mt 25:14-30; Lk 19: 11-27.

[3] 36. Cf. John XXIII, PT 65.

[4] 44. GS 29 Sect. 3.

The Lewin Group: Cited Often, Owned by UnitedHealth

In a recent Chicago Tribune article, “Health-care reform: Medical insurers poised to reap a healthy ‘bonanza,’”   the following paragraph concerning The Lewin Group caught my eye

One of the Democratic proposals that most concerned insurers was creation of a “public option” government-sponsored insurance plan. The industry launched a campaign on Capitol Hill, distributing arguments opposing the government option that often were grounded in a study published by The Lewin Group, a health policy consulting firm owned by UnitedHealth.

In an effort to stay abreast, I read a fair amount of opposition commentary–and “The Lewin Group” comes off the lips of Republicans and others opposed to the Public Option often enough. Although The Lewin Group connection with UnitedHealth has been made public by a number of sources, I’m not sure that it’s common knowledge. And perhaps, as always, when dealing with information–especially information doing duty as a foundation upon which Medical Insurers stand “poised to reap a healthy bonanza”–considering the source– and considering that the source of that information is owned by one of the nation’s largest insurers– may be worth a moment or two.

This description of The Lewin Group comes from The Lewin Group in their Testimony before the before the Energy and Commerce Committee, U.S. House of Representatives, dated June 25, 2009, and updated July 9, 2009

The Impact of the House Health Reform Legislation on Coverage and Provider Incomes

About The Lewin Group

The Lewin Group is a health care and human services policy research and management consulting firm. We have over 25 years of experience in estimating the impact of major health reform proposals. The Lewin Group is committed to providing independent, objective and nonpartisan analyses of policy options. In keeping with our tradition of objectivity, The Lewin Group is not an advocate for or against any legislation. The Lewin Group is part of Ingenix, Inc.,which is a wholly owned subsidiary of the UnitedHealth Group. To assure the independence of its work, The Lewin Group has editorial control over all of its work products. (emphasis added)

The Lewin Group was purchased by Ingenix (and thus UnitedHealth) in 2007, somewhat presciently in time for the Health Care debate. I do not doubt that The Lewin Group has a stated and formal editorial control over its work products; I do doubt that it looks to bite the hand that feeds it. And I would suggest that as an arm of UnitedHealth, despite Mr. Kellar’s claims above, self decapitation– at least in the corporate world– is less a “mystery” than it is an illusion.

A recent Washington Post article also noted The Lewin Group’s relationship to its immediate parent

Ingenix, a UnitedHealth subsidiary that was accused by the New York attorney general and the American Medical Association, a physician’s group, of helping insurers shift medical expenses to consumers by distributing skewed data. Ingenix supplied its parent company and other insurers with data that allegedly understated the “usual and customary” doctor fees that insurers use to determine how much they will reimburse consumers for out-of-network care.

In January, UnitedHealth agreed to a $50 million settlement with the New York attorney general and a $350 million settlement with the AMA, covering conduct going back as far as 1994.

Ingenix chief executive Andrew Slavitt said the Ingenix data was never biased, but Ingenix nonetheless agreed to exit that particular line of business. “The data didn’t have the appearance of independence that’s necessary for it to be useful,” Slavitt said.

This may give us some idea of where Mr. Slavitt’s bar for data’s  “appearance of independence that’s necessary for it to be useful” is set. But there is of course a possible difference to be had between “useful” and “valid” and “valid as used.”  Distinctions the video below, as well as the Chicago Trib article, may help to clarify.

It should be noted, however, that according to WaPo,

Lewin Group Vice President John Sheils said his firm had nothing to do with the allegedly flawed Ingenix reimbursement data. Lewin has gone through “a terribly difficult adjustment” since it was bought by UnitedHealth in 2007, because the corporate ownership “does create the appearance of a conflict of interest.”

“It hasn’t affected . . . the work we do, and I think people who know me know that I am not a good liar,” Sheils said.

Mr. Sheils also noted to WaPo that those who pay for studies also have the option of “burying” those studies:

But not all of the firm’s reports see the light of day. For example, a study for the Blue Cross Blue Shield Association was never released, Sheils said.

“Let’s just say, sometimes studies come out that don’t show exactly what the client wants to see. And in those instances, they have [the] option to bury the study — to not release it, rather,” Sheils said.

I wonder if UnitedHealth gets the in-house rate.

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