Questions:

1. In the last 50 years or so, how many U.S. Supreme Court cases dealt with Fifth Amendment self-incrimination?
2. Of the four Court eras covered by the database (Warren, Burger, Rehnquist and Roberts), which court era had the most number of liberal decisions?
3. How many cases from Ohio made it to the U.S. Supreme Court?

 
Answering these types of questions just got easier.  Released this week, the Supreme Court Database allows anyone to search, pull up cases, and perform simple analyses.  This new database has created quite a stir on the legal blogs. 

 
The best part of the Supreme Court Database is the search options! 

If you are interested in a single case, you can access information about it (along with links to the decision) by entering the citation or case name.  A detailed case report includes lower court background, a break down on how the Justices voted for each legal issue in the case, whether the outcome is considered conservative or liberal, and links to copies of the decision on the web.  Two links point to free copies of the case decision.

If you want to analyze all the cases or a grouping of cases, use the database search to create lists of cases by legal issue, or by Court Era, by vote detail by each Justice, vote direction (liberal or conservative), legal precedent changes, etc.

I had fun trying all sorts of searches.  How many cases declared law unconstitutional?  How many cases changed precedent?  What are the 50 most prevelant petitioners (the person who initiated the case)?  The database searches are lightening fast!  No waiting for tables to display.

“In addition to providing a web-based platform to search and analyze the Supreme Court Database, this site also provides downloadable files that researchers can use with their own statistical software.”  Durable links to searches, lists and tables work also!  Generate lists or tables and share the link with others.   For an example, see my answer links below.   Way Cool!

To use the database:  At the Supreme Court Database site, click the Analysis search tab and then click the Specifications tab.

Coverage:   Data coverage right now is from 1953 to 2008 and includes data for 7367 cases. The database will be continuously updated.   Funding from the National Science Foundation is supporting the posting of the court’s decisions and data back to 1792 over the next four years.

Answers:

1. There have been 106 U.S. Supreme Court cases on self-incrimination under the Fifth Amendment.  Click for a list of these cases.   
2. The Warren Court had 66.7% liberal decisions and only 32.1% conservative.  Click for the table.  (If you wish to see how liberal and conservative is determined, click on documentation. )
3. In the last 50 years, 80 cases from Ohio reached the U.S. Supreme Court.  Click for a list of these cases.     

     This posting compares the tort reform provisions of the Democratic and Republican health care bills which are pending in the House of Representatives.

     The civil litigation system fails us in several important respects in medical cases.  First of all, because of the extraordinary expense of bringing one of these cases, only the most serious claims have even a chance of being redressed.  If you miss a month of work because of injury resulting from medical malpractice or a faulty medical device and you have some lingering pain no responsible attorney will do more than write a letter on your behalf.  It costs money to hire experts and depose witnesses, and small or even medium-size claims are never litigated.

     Second, most medical claims which are brought are meritless.  There are plenty of bad outcomes – pretty much everyone dies in the end – and patients and their families are often prone to blame medical care providers for the result.  As a consequence both patients and doctors have to "lawyer up," and this costs money too – most of the money that is spent for medical malpractice insurance goes to attorneys, not patients.

     Third, there is no efficient mechanism for reporting medical error and fixing the problem.   Because of the severe consequences and expense of malpractice litigation, doctors and hospitals are defensive about admitting error, and as a result incompetency and ineffectiveness among health care professionals is more difficult to address.   

     In light of the foregoing problems there is ample room for "tort reform" – an overhaul of the system of discovering and correcting instances of medical error and compensating persons who are injured as a result of such errors.

     The Republican bill, the Common Sense Health Care Reform and Affordability Act, contains more extensive "tort reform" measures than the Democratic bill, the Affordable Health Choices Act of 2009, H.R. 3962.  In my opinion, insofar as they address the question of tort reform, neither bill is worth a bucket of warm spit.

     The Republican bill contains a number of proposals limiting medical claims.  These provisions are contained in Sections 301-310, beginning at page 150 of the bill.  The Republican bill would enact the following measures: 

The statute of limitations in medical injury cases would be 1 year from the date of treatment or three years from the date of the manifestation of the injury or one year after the patient discovered or should have discovered the injury.  Children injured under the age of six would have until their eighth birthday to commence a lawsuit (too bad, you dilatory nine-year olds!);

Awards for noneconomic damages (pain and suffering) may not exceed $250,000, and the jury may not be informed of the existence of this cap – I suppose because in many cases they would be outraged;

Health care providers would be liable only for their "fair share" of the damage caused by their own malpractice.  This sounds good, but this will encourage defendants to "gang up" on one defendant, particularly if that person is dead or uninsured;

Attorney fees would be limited to certain percentages of awards, including 15% of any recovery over $600,000.  Because attorneys have to invest substantial sums into pursuing any particular lawsuit, this alone would prevent many claims from being pursued;

Evidence of "collateral source benefits" would be admissible – that is, if the plaintiff was entitled to payment from health insurance, disability insurance, Social Security, Workers Compensation or virtually any other program as a result of the injury, the defendant could introduce this fact into evidence.  In my opinion this is unbelievably unfair.  People pay for these kinds of insurance themselves, either through premiums or through their taxes, and the benefits under these policies and government programs belong to them, not to the persons who injured them;

Punitive damages may be awarded to a plaintiff "only if it is proven by clear and convincing evidence that such person acted with malicious intent to injure the claimant, or that such person deliberately failed to avoid unnecessary injury."  Punitive damages would be capped at $250,000 or two times the economic damages awarded, whichever is greater.  There are several problems with this portion of the Republican bill.  First of all, it would eliminate recovery of punitive damages in cases of gross incompetency or recklessness, and in another common situation where punitive damages are routinely awarded – when medical records have been altered by the defendant.  In addition, if the patient was a child or elderly or disabled or unemployed, and the patient is killed, not simply injured, then economic damages would be relatively small, and punitive damages would also be limited even in the most egregious cases of willful misconduct.  Finally, it is one thing to limit the amount of punitive damages that a sole practicioner might be liable for in an isolated case – it is another thing to limit the amount of punitive damages that a multinational corporation might be liable for in widely distributing a product which it knew was defective;

These provisions would preempt all state laws except state laws that impose greater limitations on medical claims and state laws that specify different damage caps for noneconomic and punitive damages.

     I am married to a physician and I used to defend physicians in medical malpractice cases, but I have to admit that the only word that springs to mind to describe the Republican bill is "draconian."  While some of these proposals have great merit, the cumulative effect this law would, as a practical matter, foreclose any reasonable possibility for any person, at any time, to recover any damages for any medical injury.  And keep in mind that these limitations on medical claims protect not only individual physicians but medical conglomerates and the manufacturers of medical devices.  The Republican bill goes too far – by a longshot.

     Republicans also contend that their bill will significantly reduce the cost of medical care.  The Congressional Budget Office respectfully disagrees.  The CBO report on the Republican bill indicates that it would create savings in the federal budget of about $5 billion per year, on the average.  This is peanuts.  Total health care expenditures in the United States this year are estimated to be $2.2 trillion.  The savings from tort care reform set forth in the CBO report on the Republican bill amount to two-tenths of one percent.

     In contrast, the "tort reform" measures contained in Section 2531 of the Democratic bill, beginning on page 1431 of that bill, seemed designed to accomplish nothing.  Under the Democratic proposal the federal government would make an incentive payment to states that adopt an "alternative medical liability law in compliance with this section."  In deciding whether or not a state should receive an incentive payment, the Secretary of Health and Human Services would have to consider whether the state law:

(A) makes the medical liability system more reliable through prevention of, or prompt and fair resolution of, disputes;

(B) encourages the disclosure of health care errors; and

(C) maintains access to affordable liability insurance.

     It is difficult to imagine what measures would qualify for subsidies under the foregoing criteria.  But the succeeding paragraph is more specific:

The contents of an alternative liability law are in accordance with this paragraph if—

(A) the litigation alternatives contained in the law consist of certificate of merit, early offer, or both; and

(B) the law does not limit attorneys’ fees or impose caps on damages.

     The Democratic bill seems designed to roll back tort reform in states like Ohio which have already adopted measures capping damages or attorney fees.  Furthermore, requiring a "certificate of merit" is fruitless unless there are penalties imposed upon the plaintiff for proceeding with a meritless case.  The Democratic bill is silent on this point.

     Furthermore, if the Democratic bill specifically rewarded or even authorized "alternative dispute resolution" of medical claims – that is, mandatory arbitration of medical claims – then it might extend a significant benefit for both patients and health care providers.  Arbitration is cheaper and quicker than litigation, and if a system of arbitration were institutionalized attorneys would not be necessary and small claims could be redressed.  But I do not read the Democratic bill encouraging "alternative liability laws" as authorizing arbitration, and the "certificate of merit" requirement is not sufficiently fleshed out to merit applause.  The Democratic bill does not go nearly far enough in weeding out junk lawsuits and improving access to the justice system.

     It would seem like this is an area where Democrats and Republicans could, if they chose, reach a compromise that would balance everyone's interests in reducing medical error and compensating victims.  That does not seem to be in the cards.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     In the comments to Posting Number 55 of this series Quidpro and Dan S. debate what the effect of health care financing reform legislation will be on physicians and the willingness of persons to enter or stay in the medical profession.  We will learn more over the weekend as doctors debate whether to ratify AMA support for the House Democratic bill.

     Yesterday the AMA announced that it would support the House Democratic bill, the Affordable Health Choices Act of 2009 (H.R. 3962).  James Rohack, AMA President, stated:

“On balance, H.R. 3962, The Affordable Health Care for America Act, is consistent with our principles of pluralism, freedom of choice, freedom of physician practice and universal access. It will significantly expand health insurance coverage to Americans to empower patient and physician decision making; institute meaningful insurance market reforms; make substantial investments in quality; institute prevention and wellness initiatives; provide incentives to states that adopt certificate of merit and/or early offer liability reforms, and reduce administrative burdens.”

“H.R. 3962 is not the perfect bill, and we will continue to advocate for changes, but it goes a long way toward expanding access to high-quality affordable health coverage for all Americans, and it would make the system better for patients and physicians,” Dr. Rohack said. "This is not the last step but the next step toward health system reform. We will remain actively engaged with patients, physicians, Congress and the administration to ensure that the final bill results in marked improvements to our health system."

AMA also called on Congress to pass the Medicare Physician Payment Reform Act of 2009 (H.R. 3961) to permanently repeal the broken physician payment formula and preserve access to care for seniors, baby boomers and military families.

     If enacted the Democratic bill would achieve near-universal medical coverage through a combination of insurance regulation, individual and employer mandates with federal subsidies for low-income persons to purchase insurance, an expansion of Medicaid and CHIP, and increased taxes on the wealthy to pay for all this.  Dan and Quidpro argue about whether or not this bill will drive persons out of the medical profession.

     The Democratic bill (like the Republican bill, the Common Sense Health Care Reform and Affordability Act) fails to address the problem of SGR reform – which, if not addressed, would reduce physician fees under Medicare by over 20% next year and by additional amounts in succeeding years.  I assume that the AMA endorsement of the Democratic bill H.R. 3962 means that there has been a promise that SGR reform, H.R. 3961, will be swiftly enacted.  But the question remains, will doctors come out ahead or behind under these new laws?

     Noam N. Levey and Bruce Japsen of the Chicago report that some physician groups intend to challenge the AMA's decision in a meeting of the House of Delegates on Saturday.  Quoting the dissenters, the reporters state:

"These bills go far beyond what is necessary to fix what is broken with our health care system, and they grant the federal government considerable new powers and authority, which could ultimately amount to a complete government takeover of health care and which is anathema to doctors and patients," a resolution introduced by the American Association of Neurological Surgeons, the American Society of General Surgeons and the American Academy of Facial Plastic and Reconstructive Surgery. The resolution also was supported by AMA delegations from George [sic, Georgia] and the District of Columbia.

     I think it is notable that the specialist groups which are opposed to the Democratic bill are all surgeons.  Under the reform bill payments under Medicare and Medicaid will be redirected away from specialists and towards primary care physicians, and there will be funding to encourage the entry of physicians into primary care.  Surgeons are also more likely than primary care physicians to be liable for increased taxes under the Democratic bill.

     The weekend vote by the AMA House of Delegates on the surgeons' resolution should be instructive.

     One of the most divisive questions in health care financing reform involves funding for abortions.  Pro-life House Democrats have threatened to vote against the House Democratic bill, H.R. 3962, unless it is amended to ensure that federal funds are not spent on abortions.   A member of this group, Rep. Brad Ellsworth (D-IN), has proposed an amendment to the House Democratic bill. 

     On November 3 Representative Ellsworth issued a statement announcing his proposal.  He stated:

Ellsworth's proposal would make 5 key pro-life changes to the bill; effectively preventing federal tax dollars from being used to fund abortions and ensuring Americans have access to pro-life insurance options in the proposed Health Insurance Exchange:

Explicitly prevents all federal tax dollars from being used to provide abortions in the public option;

Prohibits any funds from the US Treasury from paying for abortion services in any of the plans purchased through the proposed Health Insurance Exchange-private or public;

Establishes clear, strict rules for separating public funds from the premiums of private individuals (ensuring that no public funds are ever used to pay for an abortion in any health plan offered on the Health Insurance Exchange);

Guarantees every American participating in the Health Insurance Exchange will always have access to a pro-life insurance option;

Expands conscience protections to prevent the government from discriminating against pro-life health insurance plans.

     Reuters reports that the pro-life organizations Americans United for Life is opposed to the House Democratic bill even with the Ellsworth amendment, stating:

"The Ellsworth Amendment will explicitly authorize federally funded abortions in the public option."

The National Right to Life Committee appears to be similarly opposed, stating that the anticipated "manager's amendment" amounts to a "cosmetic" change.  The NRLC states:

"The bill would create a national federal agency health program, the "public option," and would explicitly authorize that federal agency program to pay for elective abortions. This federal agency program will pay for abortions with federal funds (which are the only kind of funds that federal agencies can spend)."

     These organizations' characterizations of the House Democratic bill and the Ellsworth amendment are disingenuous.  The federal government will not be fully subsidizing the cost of health insurance which is purchased through the Exchange or even through the "public option."  Individuals will instead be paying premiums to purchase their own insurance.  People who earn less than 400% of the Federal Poverty Level will be eligible for federal subsidies to purchase insurance – but those subsidies are provided on a sliding scale, and people who earn more than that amount will be still be paying for health insurance out of their own pockets, even if they purchase insurance through the "public option."

     It is one thing for the law to prohibit the government from paying for abortions, and I am sympathetic to that position.  It is quite another for the law to prevent individuals from purchasing health insurance that would cover abortions, as pro-life organizations appear to be demanding.  In my opinion if such a law were adopted the government would cross the line from simply refraining to pay for abortions to interfering with people's choices in this regard – and that might be construed as "unduly burdening" the right to choose to terminate a pregnancy in violation of the Constitution.

     As a practical matter this question might be easily resolved.  If the cost of an "abortion rider" would be relatively cheap – and insurance companies might be willing to offer such riders at virtually no cost, in light of the lower costs and medical complications associated with abortions as opposed to childbirth – then the whole dispute might simply evaporate.

We watch the movie "Wall Street" as part of my M&A class.   Recently, we came to the scene where Gordon Gekko proclaims that greed is good:

The point is, ladies and gentleman, that greed, for lack of a better word, is good.  Greed is right, greed works.  Greed clarifies, cuts through, and captures the essence of the evolutionary spirit.  Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind.  And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA.  Thank you very much.

A recent paper by Wang & Murnighan (HT: Prof. Ribstein) suggests Gekko may have taken a few economics classes on the side while working his way up through the school of hard knocks:

Greed is a classic topic in human development (Balot, 2001; Robertson, 2001) and it inevitably affects many of our choices and decisions.  Although greed is typically viewed as uniformly negative and reprehensible, we propose that people's attitudes and opinions about greed are actually subject to change.  In particular, studying economics may help legitimize and even beautify greed.  Previous research shows that economics education might make people more self-interested because self-interest maximization is central to most economic models (Marwell & Ames, 1981; Frank, et al, 1993).  Because greed and maximizing self-interest are sometimes difficult to separate, conceptually or empirically, we propose that studying economics may make people view greed as potentially positive and beneficial.  Two complementary studies support our proposition.  Study 1 shows that students who are pursuing economics view greed more positively than students who are pursuing other majors and taking other courses.  Study 2 indicates that positively priming greed can significantly increase people's positive attitudes and opinions about greed.

But if greed is by definition tied to excess, can it ever be good?  I'm not sure where I come out on this, but one suggestion I do feel comfortable making is that we include classes on cognitive biases along with our econ classes.  Greedy may be good, but greedy and dangerously overconfident is just a recipe for disaster.

     The Republican Party in the House of Representatives has offered an alternative to the Democratic health care financing reform bill.  This posting contains links to the bill and to CBO scoring of it, and a very preliminary analysis of the bill.

     Here is the Common Sense Health Care Reform and Affordability Act unveiled by Minority Leader John Boehner (R-OH) and the House Republicans late last night.  Here is theNovember 4, 2009, CBO report scoring the bill.  For purposes of comparison, here is the House Democratic bill, the Affordable Health Choices Act of 2009 (H.R. 3962) and the October 29, 2009, CBO report scoring that bill. 

     I have not yet read the Republican bill nor have I found any written summary of its provisions outside of the CBO report.  With those qualifications in mind, here is a preliminary comparison of the two bills on several measures:

COVERING THE UNINSURED

     According to the CBO reports, the House Democratic bill would extend health insurance to 36 million Americans who are currently uninsured.  The Republican bill would extend health insurance to only 3 million uninsured Americans.  Under the Democratic plan 97% of persons in this country (excluding illegal immigrants) would have health insurance; under the Republican plan 83% of persons lawfully in this country would be covered – the same percentage that are covered today.

INDIVIDUAL AND EMPLOYER MANDATES

     The Democratic bills require individuals to purchase health insurance, and the House Democratic bill requires large employers to "play or pay" – that is, to provide insurance to pay a fee to help employees purchase insurance.  The House Republican bill does not appear to include any provisions mandating health insurance coverage.

ELIMINATION OF EXCLUSIONS FOR PREXISTING CONDITIONS AND LIFETIME LIMITS 

     The Democratic bills prohibit insurance companies from denying coverage or charging customers more on account of preexisting conditions.  On Monday the Wall Steet Journal reported that the Republican plan would not prohibit insurance companies from excluding coverage for preexisting conditions, but Rep. Boehner responded at that point that the news media was reacting to an incomplete draft of the Republican bill and not to the final bill itself.  Yesterday Rep. Boehner released a statement regarding the bill in which he said:

Not only does the GOP plan lower health care costs, but it also increases access to quality care – including for those with pre-existing conditions – at a price our country can afford.

     I have not yet been able to determine whether the Rep. Boehner means that the Republican bill eliminates exclusions for preexisting conditions or whether he simply means that the Republican bill will lower health care costs for everyone, "including for those with preexisting conditions." 

     I have also not found any information about lifetime coverage limits under the Republican bill.

AGE AND GENDER RATINGS

     The Democratic bills abolish insurance ratings on account of gender and place a maximum limit on the amount of difference that may be charged on account age.  Again, I do not know whether the Republican bill addresses these issues, or whether it simply places no limitations on the premiums that women and older people may be charged for health insurance.

REGULATION OF THE MARKET FOR HEALTH INSURANCE

     One of the core features of the Democratic bills is to create an "Exchange" or "Gateway" by means of which individuals may purchase standardized health insurance policies.  At present, the individual market is fragmented and inefficient.  The "exchanges" would pool the purchasing power of individuals throughout the nation, state, or region, depending on how broad the boundaries of the market are drawn.  In addition, under the Democratic proposals insurance policies would have to meet certain criteria to be sold on the Exchange – in addition to covering preexisting conditions and abolishing lifetime limits for coverage, there would be requirements that the policies would be comprehensive (covering physician and hospital expenses) and that the policies would cover a certain percentage of customers' health care expenses. 

     The Republican bill apparently does not create insurance exchanges.  I infer this because the CBO report of the Democratic bill states that law would add 21 million people to insurance rolls through the Exchanges, while the CBO report for the Republican bill contains no category listing enrollment through exchanges.  The CBO report does state that the Republican bill creates "association health plans" and "individual membership associations."  From the names it would seem that these entities are not regulated markets but rather group insurance programs – perhaps similar to the "co-ops" proposed by Senator Conrad and included in the Senate Finance Committee bill.

     I have also found nothing in news reports or the Minority Leader's website indicating that the proposed legislation would regulate the content of health insurance policies.

SUBSIDIES TO HELP PEOPLE PURCHASE INSURANCE

     The Democratic bills provide substantial amounts assisting low income persons to purchase health insurance – the CBO estimates that the law would provide on average $60 billion per year in subsidies to purchase insurance through the Exchange.  The Republican bill provides relatively small subsidies for "reinsurance and high risk pools" at a cost of $4 billion annually, and an expansion of health savings accounts that would cost the government $1 billion annually in lost revenues. 

MEDICAID AND CHIP

     Under the Democratic bills Medicaid and CHIP would be expanded to everyone earning below 150% of the Federal Poverty Level, at a cost averaging $40 billion per year.  The Republican bill expects to spend $1 billion less per year on Medicaid and CHIP.

COST TO THE FEDERAL GOVERNMENT

     The House Democratic bill spends more, taxes more, and saves more than the House Republican bill, but the net effect is about the same.  As noted above, the Democratic bill spends about $60 billion more per year on Medicaid and CHIP and $50 billion per year on subsidies to help people purchase health insurance.  It pays for this by raising taxes on persons earning more than $1 million per year and by reducing payments to non-physicians under Medicare.  The Democratic bill actually has a stronger effect on reducing the national deficit than the Republican bill does.  The CBO estimates that the House Democratic bill will reduce the deficit by about $104 billion over ten years and that the House Republican bill would reduce the deficit by $68 billion over ten years. 

COST OF HEALTH CARE

     Before comparing the Democratic and Republican health care bills, remember that if we do nothing the cost of health care is expected to double over the next ten years – just as it has over the past ten years.  Spending on health care will rise from $7,00 to $14,000 per person per year, and overall spending on health care will rise from 16% to 20% of Gross Domestic Product.

     It is not possible to directly compare the effect of the Democratic and Republican bills on the cost of health care because the CBO used different frames of reference for each bill.  The CBO estimated the effect of the Republican bill on health insurance premiums, and it estimated the effect of the Democratic bill on overall health care spending.  The November 4 CBO scoring of the Republican bill states that after ten years the law would reduce the cost of health insurance premiums by about 10% compared to what premiums would be if we did nothing, but it makes no estimate of what our nation's total expenditures on health care will be if the Republican bill is adopted.  The October 29 CBO scoring of the Democratic bill estimates that under the Democratic bill after ten years total health care expenditures will be 2% higher than they would be if the bill were not enacted.    

     In my opinion, the measure that the CBO applied to the Democratic bill is the more important consideration.  If total health care spending goes up, it really won't matter very much if Republicans succeed in making the cost of health insurance premiums go down – particularly if the cost of health insurance goes down because sick people can no longer acquire or afford health insurance.  Similarly, it is wonderful that the Democratic bill will deliver high quality health insurance coverage to nearly every person, but if health care costs continue on their upward trajectory – if health insurance premiums and health care costs double or (under the Republican bill) increase by 90% over the course of the next ten years – it will place health insurance out of reach of the average person and will make it difficult or impossible for even the national government to pay for our health care needs. 

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Voters in Maine and Washington State voted yesterday in referenda on whether to approve or disapprove laws that had been adopted by their state legislatures relating to the recognition of same-sex unions.  In Maine, the voters decided to reject a law that would have recognized same-sex marriage.  In Washington State the voters ratified a domestic partnership law that grants same-sex couples the same legal rights as married couples.

     According to an article by Kevin Miller and Judy Harrison of the Bangor Daily News, by a margin of 53-47 % voters in Maine have chosen to reject the state's same-sex marriage law.   There was popular support for same-sex marriage in cities such as Portland and Bangor, but this was overcome by votes from rural areas of the state and Roman Catholic / Franco-American regions. 

     The legislature had adopted this law and Governor had signed it in May of this year, but opponents placed the measure on the ballot to prevent the law from going into effect.  The Maine law, LD 1020, contained the following definition of marriage:

Marriage is the legally recognized union of 2 people. Gender-specific terms relating to the marital relationship or familial relationships, including, but not limited to, "spouse," "family," "marriage," "immediate family," "dependent," "next of kin," "bride," "groom," "husband," "wife," "widow" and "widower," must be construed to be gender-neutral for all purposes throughout the law, whether in the context of statute, administrative or court rule, policy, common law or any other source of civil law.

     The Maine law would have recognized same-sex marriages that had been performed in other states:

A marriage of a same-sex couple that is validly licensed and certified in another jurisdiction is recognized for all purposes under the laws of this State.

     And the Maine law contained a provision preserving the religious freedom of religious institutions that chose not to participate in same-sex marriages:

This Part does not authorize any court or other state or local governmental body, entity, agency or commission to compel, prevent or interfere in any way with any religious institution's religious doctrine, policy, teaching or solemnization of marriage within that particular religious faith's tradition as guaranteed by the Maine Constitution, Article 1, Section 3 or the First Amendment of the United States Constitution. A person authorized to join persons in marriage and who fails or refuses to join persons in marriage is not subject to any fine or other penalty for such failure or refusal.

     Isn't it interesting that the foregoing "conscience provision" would have applied not only to members of the clergy but to "any person authorized to join persons in marriage."  I suppose that would include judges and ship captains – and what a contrast to the situation in Louisiana where a justice of the peace who refused to officiate at interracial marriages was recently driven from office.

     In Washington State, by an even narrower margin, voters chose to approve the state's new domestic partnership law that essentially grants gay and lesbian couples all of the same rights that married couples have.  The Secretary of State's office indicates that the ballot measure ratifying domestic partnerships passed with 51% of the vote.  According to an article by Lornett Turnbull, Janet I. Tu, and Susan Kelleher of the Seattle Times, the measure passed by wide margins in King County and the Puget Sound area and was "soundly rejected" in eastern Washington – the same urban-rural pattern that obtained in Maine.

     Like the Maine law, the Washington Law, S. 5688, was adopted in May of this year, and was challenged by voters seeking to overturn the law by way of referendum.  Here is a link to a page of the Washington State Legislature website from which you can access text of the bill and other documents relating to its legislative history.

     One interesting feature of the Washington Domestic Partnerships law is that it applies not only to same-sex couples but also to unions where one of the persons is 62 years of age or older.  I assume that this is for the purpose of preserving people's rights to survivorship benefits under Social Security or other laws or pension plans, but I would have to research this to be sure.  According to Ballot Pedia, here is the official summary of the law:

Same-sex couples, or any couple that includes one person age sixty-two or older, may register as a domestic partnership with the state. Registered domestic partnerships are not marriages, and marriage is prohibited except between one man and one woman. This bill would expand the rights, responsibilities, and obligations of registered domestic partners and their families to include all rights, responsibilities, and obligations granted by or imposed by state law on married couples and their families.

     Here are links to websites from Approve Ref 71 and Protect Marriage Washington, organizations that supported and opposed this measure.

     Senators representing rural states and members of Congress from rural districts support legislation that would increase revenues for rural hospitals.  (Dog bites man!)

     Eric Pianin and Mary Agnes Carey, in an informative article written for Kaiser Health News, describe how lawmakers from rural states and congressional districts are attempting to direct extra Medicare revenues towards rural hospitals by having those institutions designated as "Critical Access Hospitals."  The designation "critical access" was originally intended to offer support to a few dozen small rural institutions that were more than 35 miles away from any other hospital and which would serve mainly as transport points – patients who were seriously injured or ill would be stabilized at these access points and transferred to larger hospitals.  The program has evolved to the point that one-fifth of all of the hospitals in the United States are now designated "critical access hospitals,"  entitling them to additional Medicare funding.  These hospitals don't simply transport seriously ill patients – they treat them, thus injecting money into local economies.  Lawmakers representing rural areas want to increase the numbers of these hospitals and allow them to grow larger and still qualify for extra funding.  Pianin and Carey identify Mark Pryor (D-AR), Sam Brownback (R-KS), and Ron Wyden (D-OR) as seeking an expansion of this program. 

     This could emerge as an important element to winning support for health care financing reform.  In Monday's Politico Jeanne Cummings describes Rep. Rick Boucher (D-VA), as "a moderate who could become a critical swing vote," and that:

he has serious reservations about how the reform proposals will affect the rural hospitals in his district — and he knows he isn’t alone.

     Sections 1191-1196 of the House bill relate to rural access hospitals.  The CBO report scoring the bill indicates that these sections of the bill contain about $2 billion in funding for extension of various programs relating to these hospitals.  Rural lawmakers will likely focus on these provisions of the bill in their attempt to promote access to health care within local communities and stimulate the economy of rural areas.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     According to a report by the Congressional Budget Office, H.R. 3962, the bill that Speaker Nancy Pelosi brought to the House floor last week costs $343 billion less than the bill that it replaced, H.R. 3200.  How was this accomplished?

     Here is the CBO report on the new House bill, H.R. 3962, and here is the CBO report for the previous version of the House bill, H.R. 3200.   The new bill extends insurance coverage to 36 million people who are currently uninsured (a million fewer people than the previous bill) and, like the previous bill, it upgrades the insurance coverage of every American by prohibiting exclusions for preexisting conditions, abolishing lifetime limits in coverage, and requiring total coverage for preventive care. 

     These reforms will cost about $100 billion annually, or about $1 trillion over ten years.  There are two principal components to this cost: approximately $40 billion more per year for Medicaid and CHIP, and $60 billion more per year in federal subsidies for individuals earning less than four times the Federal Poverty Level to purchase private or public health insurance through the Exchange.

     The biggest change in the new bill is that the H.R. 3962 is expected to reduce the federal deficit by $104 billion over ten years, while the previous bill, H.R. 3200, would have increased the deficit by $239 billion.  How were these savings accomplished?

     The biggest losers under the new bill are physicians, to the tune of $245 billion over ten years.  H.R. 3200 would have changed the SGR formula that threatens to impose a 20% reduction in physician's fees under Medicare.  I addressed this topic in Posting Number 48 in this series.  Senator Debbie Stabenow (D-MI) has introduced legislation in the Senate to address this problem, and the original House bill made this change as well.  The new bill, H.R. 3962, drops the amendment to the SGR formula.  This means that unless separate legislation is adopted this year, Medicare will reduce its payments to physicians by over 20% in 2010 and there will be additional annual reductions of about 6% in each of the next several years.  Obviously this change has to be made.  It would make sense to include this change in the reform bill.

     The new bill also saves money by enrolling more people in Medicaid.  Under the new bill, everyone earning less than 150% of the Federal Poverty Level will be eligible for Medicaid; under the old bill the qualification requirement had been 133% of the poverty level or less.   The CBO estimates that as a result of this change four million more people will be insured by Medicaid instead of purchasing insurance through the Exchange.   This saves money because it is cheaper to enroll people in Medicaid than it is to pay for them to purchase private insurance through the Exchange.  Under the new bill direct subsidies to poor people to purchase health insurance will be reduced by $40 billion over ten years.  The new bill also reduces the share that the federal government would pay under Medicaid from 100% to 91%.  Because of this, the CBO estimates that over ten years the federal government will spend $13 billion less on Medicaid and CHIP under the new bill than under the old bill, despite enrolling four million more people.

     The other significant change to the House bill is that it will tax fewer and richer people.  The original bill raised the income taxes of individuals earning more than $280,000 and couples earning more than $350,000 annually.  H.R. 3962 increases these threshholds and imposes a surcharge of 5.4% on individuals earning more than $500,000 and couples earning more than $1,000,000 per year.  This will raise over $50 billion dollars annually and covers about two-thirds of the total cost of the bill.  The rest of the cost is covered by reductions in Medicare payments to health care providers other than physicians and changes in the fee-for-service formula for payments to physicians under Medicare Advantage.  The CBO estimates that these two changes will save about $40 billion annually.

     In short, H.R. 3962 increases spending on health care for poor people by about $100 billion per year, imposes increased taxes and fees of about $60 billion per year on wealthy people, and reduces spending in various areas amounting to about $50 billion per year.  Thirty-six million more people will have health insurance, and everybody's insurance coverage will be more comprehensive.

     Any health care reform legislation seeking to reduce cost, broaden access, and improve quality must address the promise and the expense of biologic drugs.  A debate has erupted over the best way to encourage research and production of these drugs while at the same time making them broadly available to the people who need them.

     The National Cancer Institute defines "biologic drug" as:

A substance that is made from a living organism or its products and is used in the prevention, diagnosis, or treatment of cancer and other diseases. Biological drugs include antibodies, interleukins, and vaccines. Also called biologic agent and biological agent.

     Biologic drugs are the newest form of "wonder drugs,"  and many of them are enormously expensive.  According to an article by Alicia Mundy of the Wall Street Journal, the top six drugs sold through Medicare Part D are biologics.  She states that the anti-cancer drug Herceptin costs $48,000 annually.  Jane Hamsher of Firedoglake notes that Humira, which is used to treat active cases of Crohn's Disease, costs $22,000 per year. 

     The health care reform legislation under consideration in Congress prohibits exclusions for preexisting conditions and abolishes lifetime coverage limits.  Essentially, the law will guarantee that these drugs will be available to persons who need them.  But can we afford to pay for these modern miracles?

     Both the House and the Senate reform bills contain provisions that protect the manufacturers of these drugs from competition for a period of twelve years after FDA approval of the drug, but also encourage the production of "biosimilar" drugs once the twelve-year period has expired.  Mundy's article in the WSJ reported that this provision, sponsored by Representative Anna Eshoo, was adopted 47-11 by the House Energy and Commerce Committee.  A House Committee on Education and Labor provided the following description of the relevant provision of the House bill:

Follow-on biologics. Creates an FDA licensure pathway for "biosimilar" generic biological products, allowing these products to come to market and compete with brand name biologics. The biosimilar product must have no clinically meaningful differences in safety, purity or potency from the reference product, and may not be licensed until at least 12 years after the date that the brand-name product was licensed.

     Hamsher is extremely critical of the proposed law, calling it:

protectionist legislation that puts corporate profits over access to health care.

Hamsher favors shortening the period of exclusivity from 12 to 7 years, a period that President Obama has also called for.

     Representative Eshoo responded to Hamsher's criticism on October 30 in an article in the Huffington Post.  She contends that the provision she sponsored bill will actually speed up the development of cheaper "generic" biologic drugs by allowing competitors to rely upon the research conducted by the original manufacturer.  Rep. Eshoo states:

Under the legislation that Senator Kennedy and I championed, prospective biosimilar manufacturers would be permitted to use an accelerated approval process and utilize the clinical trials and laboratory data of the innovative product to demonstrate the safety and efficacy of their product. Biotechnology products are highly complex and, unlike traditional chemical drugs, they cannot be precisely duplicated by a second manufacturer. Our amendment would allow these follow-on manufacturers to say, in essence, "my product is close enough to the original product, and the FDA can rely on the innovator's safety and efficacy data to approve my product."

     The issue of how to pay for biologic drugs is emblematic for all of health care financing reform.  It underscores that we are all in this together.  Almost no-one can afford to pay for these drugs out of individual earnings or savings.  Hopefully as a nation we can figure out how to ensure that everyone who needs these drugs will receive them.

Let's have some fun!  Below is a sampling of haunted courthouses, haunted jails and even haunted libraries.  Some of the ghostly apparitions were caught on security cameras or web cams!  

Haunted Courthouses

• Lincoln County Courthouse, NC.  Charlotte News (after clicking on the link scroll down to read the article and see the video from a surveillance camera).  Possible explanation and a better quality video is found here .
• Pickens County Courthouse, Carrollton, Alabama has the famous face in the window.  Background story here and more pictures here.

 Haunted Jails

• Ohio State Reformatory in Mansfield is included on most lists of haunted jails.  Story here.   Sign-up for ghost walks and ghost hunts or visit the Reformatory for Halloween.
•  Alcatraz Federal Prison, now a national park, with history here and Alcatraz ghost stories here.    YouTube video interview and ghost photographs.  Judge for yourself!

Haunted Libraries

• The Willard Library, Evansville, Indiana, has had a ghost cam for years.  Software allows users to click and post images from the library’s three cameras.  The fun is looking at postings by others to see if you see the ghost.  Make sure to click in the bottom of each frame to “get a better look.”
• Here is a listing of more haunted libraries in the Midwest and Ohio. 

 Buying a Haunted House?

Can you back out of a deal if you bought a home but then discover it is haunted?  Can you get your money back?  Well, in New York in 1991 there was such a case,  Stambovsky v. Ackley, 572 N.Y.2d 672 (NY App. Div. 1991).  It seems that Helen Ackley owned the home and knew that it was haunted.  In fact, so did everyone in the neighborhood.  Helen enjoyed the ghosts but the new owner, who was from New York City, did not know about the house’s reputation, did not enjoy spending $650,000 for a haunted house and wanted out of the deal.  In the end, the court let the potential buyer out of the contract.  More information with picture of the home here and here.

The judge had great fun writing the opinion, sprinkling references to ghosts, hauntings, paranormal phenomena, and even the Ghostbusters movie.  The opinion begins with…”Plaintiff, to his horror, discovered that the house…”   The judge also stated that the “as a matter of law, the house is haunted.”   The court opinion is fun to read, is only 6 pages long and can be found here.   More about the story here.

Happy Halloween!

But this time it's not because of a technicality. A Pennsylvania judge has been sending children to jail on first-time misdemeanor offenses in order to provide financial support to the for-profit prison company that paid him millions under the table. Can you imagine losing two years of your childhood at the age of twelve for taking your mom's car on a joyride that injured nobody? It's a real crime.

     There are three problems that we face as a nation: lack of universal access to medical care, poor quality medical care for many people, and the high cost of medical care.  The last problem is the most intractable.  I propose a solution below. 

     First, we are the only industrialized country that does not have universal health care.  Millions of Americans are going untreated for chronic medical conditions because they lack health insurance. 

     Second, although many people who are insured receive excellent medical care, many do not – and as a result of the fact that large numbers of people are uninsured or underinsured, the quality of medical care that Americans receive is, on the average, substantially lower than that of any other industrialized nation. 

     Third, Americans spend about twice as much on medical care as any other country in the world.  Over the last decade the cost of medical care in the United States has doubled and over the next decade it will double again.  Medical care now consumes over 16%  of national income (which is double that of any other country) and this percentage is expected to rise to over 20% of our budget (both government budget and household budgets) by 2019. 

     There is no disagreement over the accuracy of these facts.  Insurance companies, advocates for reform, and nonprofit research organizations all reach the same conclusions about lack of access, poor overall quality, and cost.  See the studies and reports assembled at my website on health care financing reform.

     What are the solutions?  The bills currently before Congress reforming health care will make substantial progress towards achieving universal access.  Once these reforms become fully effective between 94% and 97% of the population will have adequate health insurance.  These bills also begin to address the issue of quality of health care.  They contain a number of provisions intended to improve quality of care, including measures that would train more primary care physicians and increase their pay. 

     But the reforms being considered in Congress will have very little effect on the cost of medical care, and that is not only unfortunate, it is disastrous.  If we cannot "bend the cost curve" down, our economy will be wrecked.  Because of the high cost of medical care the national debt will soar and our manufactured products will become so expensive that they will be uncompetitive in the global marketplace.  What happened to American automobile manufacturers will happen to the producers of every product and service. 

     What is the solution to the problem of cost?  I see only one way forward.  We must find a way to make long-term investments in people's health and health care.  Medical costs will come down only when each and every person has a medical "home" where preventive care is practiced and chronic problems are efficiently and proactively managed.  At present, anyone can visit the emergency room and receive treatment for a life-threatening injury, but what about the follow-up?  Anyone can go to the hospital for a drug overdose, but where can we go to treat addiction?  Patients can be brought in to an urgent care center because they in insulin shock or tachycardia or respiratory distress, but who is effectively monitoring and treating diabetes, circulatory problems, and asthma? 

     Under the current system, whether it is Medicare or private insurance, all too often the insurance companies or medical care providers work under short-term contracts.  At our places of employment we sign up for health insurance one year at a time.  Neither our insurers nor our doctors – and certain not our hospitals – have any assurance that the patients whom they care for today will be their patients tomorrow.  Neither insurers nor physicians have any economic incentive to prevent health care problems from occuring over the long term.  My health insurer, my physicians, and my hospital have no reason to make any investment that they will not reap the benefit of. 

     Let us consider a single example.  We could save enormous amounts of money simply by creating a single electronic file of each person's medical condition and medical care that would be accessible to any physician, any hospital, and any pharmacy.  This would reduce medical error and eliminate redundancy.  (How many times have you related your medical history?  How many times have tests had to be repeated because the results were not available?  How many people are prescribed drugs that are inappropriate for their specific condition or that interact badly with other drugs they are taking?)  But who is going to make that investment in information technology?  Why should my insurer pay for that?  If it does, it will have to raise its premiums, and another insurer that does not make this investment can submit a lower bid to my employer or the government and win the health insurance contract the following year.  

     The same is true for virtually any investment that would improve people's health over the long term.  For example, we know that medical costs can be reduced if every person has a "medical home" – a primary care physician or clinic that provides preventive care and manages chronic disease.  But why should insurers or health care organizations go to the expense of creating these medical "homes" if other companies can take their contracts away by not providing these services and thereby underbidding them? 

     As I see it, the principal barrier to bringing down the cost of medical care is the short-term horizon that insurers and providers are practically forced to adopt under the present system. 

     A government-owned medical care system like that of Britain or the Veterans Administration can afford to make these long-term investments in information technology and primary care because they know that they will have the same patients for the rest of their lives, and so it makes perfect sense to keep those people in as good health as possible.  In that type of permanent medical relationship it would probably save money to build gyms and let people work out for free!  Or to provide free programs to overcome addiction or prevent domestic violence or manage depression!

     In the long run, the only solution to the problem of cost is to estabish some kind of long-term relationship between insurers and providers on the one hand and the patients they serve on the other.

     My challenge to you – is it possible to create those incentives to invest in long-term health care in a system of private health insurance?

Interesting article over at MSN Money.  Here's a taste:

Just where did Wall Street go wrong? It's popular to blame misaligned incentives, lack of regulation or just plain greed. . . . The truth is, sadly, more complex, but it boils down to this: Harvard Business School is to blame. Harvard Business School led the charge away from an approach to business centered on relationships and commerce and toward one rooted in markets and competition. . . . a Hobbesian view of business — nasty, brutish and every man for himself — and a rejection of the idea that ultimately we're all in this together. . . . In this worldview, "business ethics" is an oxymoron, not because of bad behavior but because ethics can't even exist apart from some notion of a "relationship" to something or someone else. Subordinating everything to shareholder value is, literally, anti-ethical.

I just want to say that I fully support blaming Harvard.  I graduated from Brown.  In fact, I think this should justify granting sole possession of the 2008 Ivy League football championship to Brown.

     Speaker of the House Nancy Pelosi and the House leadership have agreed upon a bill that they will bring to the floor of the House for consideration.  Below the fold are links to the text and summaries of the bill, as well as a list of fourteen reforms that would be immediately implemented if it were to become law.

     The new bill is called the Affordable Health Care for America Act.  The text of the bill is available here, a four-page summary here, and a ten page summary here.  As expected, the bill includes a "public option" that would allow the government to sell health insurance to citizens after negotiating prices with doctors and hospitals.

     Speaker Pelosi issued a statement saying that, if enacted, the law would immediately accomplish fourteen reforms.  These are:

TOP 14 PROVISIONS THAT TAKE EFFECT IMMEDIATELY

1. BEGINS TO CLOSE THE MEDICARE PART D DONUT HOLE — Reduces the donut hole by $500 and institutes a 50% discount on brand-name drugs, effective January 1, 2010.

2. IMMEDIATE HELP FOR THE UNINSURED UNTIL EXCHANGE IS AVAILABLE (INTERIM HIGH-RISK POOL) — Creates a temporary insurance program until the Exchange is available for individuals who have been uninsured for several months or have been denied a policy because of pre-existing conditions.

3. BANS LIFETIME LIMITS ON COVERAGE—Prohibits health insurance companies from placing lifetime caps on coverage.

4. ENDS RESCISSIONS—Prohibits insurers from nullifying or rescinding a patient’s policy when they file a claim for benefits, except in the case of fraud.

5. EXTENDS COVERAGE FOR YOUNG PEOPLE UP TO 27TH BIRTHDAY THROUGH PARENTS’ INSURANCE— Requires health plans to allow young people through age 26 to remain on their parents’ insurance policy, at the parents’ choice.

6. ELIMINATES COST-SHARING FOR PREVENTIVE SERVICES IN MEDICARE—Eliminates co-payments for preventive services and exempts preventive services from deductibles under the Medicare program.

7. IMPROVES HELP FOR LOW-INCOME MEDICARE BENEFICIARIES—Improves the low-income protection programs in Medicare to assure more individuals are able to access this vital help.

8. PROVIDES NEW CONSUMER PROTECTIONS IN MEDICARE ADVANTAGE— Prohibits Medicare Advantage plans from charging enrollees higher cost-sharing for services in their private plan than what is charged in traditional Medicare.

9. IMMEDIATE SUNSHINE ON PRICE GOUGING—Discourages excessive price increases by insurance companies through review and disclosure of insurance rate increases.

10. CONTINUITY FOR DISPLACED WORKERS—Allows Americans to keep their COBRA coverage until the Exchange is in place and they can access affordable coverage.

11. CREATES NEW, VOLUNTARY, PUBLIC LONG-TERM CARE INSURANCE PROGRAM—Creates a long-term care insurance program to be financed by voluntary payroll deductions to provide benefits to adults who become functionally disabled.

12. HELP FOR EARLY RETIREES—Creates a $10 billon fund to finance a temporary reinsurance program to help offset the costs of expensive health claims for employers that provide health benefits for retirees age 55-64.

13. COMMUNITY HEALTH CENTERS—Increases funding for Community Health Centers to allow for a doubling of the number of patients seen by the centers over the next 5 years.

14. INCREASING NUMBER OF PRIMARY CARE DOCTORS — Provides new investment in training programs to increase the number of primary care doctors, nurses, and public health professionals.

     Tomorrow I will post more details about the bill.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Speaker of the House Nancy Pelosi announced last week that the legislation proposed in the House will close the "donut hole" (the coverage gap) in Medicare Part D prescription drug coverage.  Details below.

     The "donut hole" requires persons on Medicare to pay a substantial portion of the cost for the prescription drugs.  In an article for About.com, Michael Bihari, M.D., describes how the "donut hole" works for 2009:

If you join a Medicare prescription drug plan, you pay the first $295 of your drug costs. This is known as the deductible.

During the initial coverage phase, your drug plan pays 75% of the covered prescription drug costs after your deductible is met, and you pay 25% until the total drug costs (including your deductible) reach $2,700.

Once you reach $2,700 in total drug costs, you will be in the donut hole and you must pay the full cost of prescription drugs until your total out-of-pocket cost reaches $4,350. This annual out-of-pocket spending amount includes your yearly deductible and copay amounts.

When you spend more than $4,350 out-of-pocket, the coverage gap ends and your drug plan pays most of the costs of your covered drugs for the remainder of the year. You will be responsible for a copay of $2.40 for each generic drug and $6.00 for other drugs. This is known as catastrophic coverage.

     On October 23 Speaker Pelosi announced that a provision would be added to the House health care financing bill to gradually close the donut hole.  In a press release she stated:

Today, we’re announcing that our health insurance reform bill will begin closing the Medicare Part D ‘donut hole’ immediately. As of January 1, 2010, our legislation will give a 50 percent discount for brand-name drugs to recipients in the donut hole and it will reduce the size of the donut hole by $500. The House bill will completely eliminate the gap in coverage in 10 years – five years faster than was originally intended in HR 3200.

     This will be one more element to be analyzed and compared when the final versions of the House and Senate health care bills are revealed.

     Across the United States there are relatively few health insurers offering coverage in any particular geographic market.  Following Justice Department guidelines, over 94 percent of U.S. markets for health insurance are "highly concentrated."   In some states, there are only one or two insurers offering health insurance coverage.  Despite this level of market concentration, however, the Congressional Budget Office has concluded that abolishing the antitrust exemption for health insurers would have little impact on either the federal budget or the cost of health care.

       Both the American Medical Association and the advocacy group Health Care for America Now! have issued reports (available here and here) describing the high level of concentration in the health insurance industry within almost every geographic market in the United States.  Only a handful of health insurers – and sometimes only one insurer – operate within any particular metropolitan area, region, or sometimes even within an entire state.  In this article by Emily Berry published in AmedNews it is suggested that the market concentration occurs because existing insurers erect barriers to entry within particular markets.

     On October 21, the House Judiciary Committee, by a vote of 20-9, approved H.R. 3596, which would abolish the antitrust exemption for health insurers.  The Congressional Research Service states that the bill:

Declares that nothing in the McCarran-Ferguson Act shall be construed to permit health insurance issuers or issuers of medical malpractice insurance to engage in any form of price fixing, bid rigging, or market allocations in connection with providing health insurance coverage or coverage for medical malpractice claims or actions.

     On the same date the bill's sponsor Representative Conyers (D-MI) issued this statement:

"Today’s vote is an important step forward toward opening up health and medical malpractice insurance markets to real competition," said Conyers. "Joined by three of my Republican colleagues, the House Judiciary Committee agreed to bring antitrust enforcement to the two most abusive practices of the health insurance industry – price fixing and market allocation. Although state regulation of this industry is crucial – and is preserved in this bill – it has proved insufficient to prevent these particularly abusive practices. No one on this committee believes that price fixing or carving up markets is a good thing, and the wide, bipartisan support for this bill’s passage reflects this. This measure fixes a mistake sitting on the federal statutes for over sixty years, making an important contribution to the health reform efforts underway in both houses of Congress."

     However, two days later, on October 23, the CBO issued a report concluding that H.R. 3596 would have little impact on either the federal budget or health care expenditures, because it believed that few health insurers are engaged in market allocation or price fixing.  The CBO states:

Based on information from the Department of Justice and insurance industry experts, CBO expects that H.R. 3596 would apply to a small number of offenders ….

     The CBO finds that the effect of the law on health insurance premiums is "likely to be quite small:"

     H.R. 3596 could affect the costs of and premiums charged by private health insurance companies; whether premiums would increase or decrease as a result is difficult to determine, but in either case the magnitude of the effects is likely to be quite small. To the extent that insurers would otherwise engage in the prohibited practices and be prevented from doing so by enactment of this bill, premiums might be lower. (That effect is likely to be small because state laws already bar the activities that would be prohibited under federal law if this bill was enacted.) To the extent that insurers would become subject to additional litigation, their costs and thus their premiums might increase. Based on information from the Justice Department, the Federal Trade Commission, the National Association of Insurance Commissioners, consumer groups, and private attorneys, CBO estimates that both of those effects would be very small, and thus that enacting the legislation would have no significant effect on the premiums that private insurers would charge for health insurance.

     The insurance industry argues that market concentration is a natural and beneficial phenomenon because if there are many small insurers then health care providers hold the balance of power and can demand and obtain higher fees.  When there are only one or two insurers in a geographic market, the insurers argue, they can negotiate lower rates with providers.

     I am not convinced by the insurers' arguments.  Market concentration must be addressed.  If market concentration is the result of collusion, then this bill is the solution.  If there are legal or "natural"  barriers to entry then they must be dismantled by opening markets up to competition.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

Akron Law will hold a special celebration on Wednesday, Nov. 4 in honor of the life of Professor Malina Coleman who passed away on Oct. 25. The celebration will be held at Quaker Square Inn at The University of Akron in Ballrooms B and C from 4:30 – 7:30 p.m. Professor Coleman had been a professor at Akron Law since 1989. More details about the celebration are available here.

     There is an excellent article by Ricardo Alonso-Zalvidar in today's Chicago Tribune describing the current political status of health care reform.  The journalist quotes Senator Max Baucus (D-MT) as saying that there is "a sense of inevitability … that yes, we're going to pass health care reform."  Senate Majority Leader Harry Reid and Speaker of the House Nancy Pelosi are deciding what to include in the legislation that they will bring to the floor of their respective chambers.  This posting summarizes the topics where there is broad agreement and the issues that are still being hashed out.

     Almost everyone agrees that the health insurance system must be changed in the following respects:

1.  Exclusions for Preexisting Conditions Must Be Abolished.  Health insurance policies must cover preexisting conditions.  No-one may be refused insurance, or be required to pay a higher premium, simply because they are sick.

2.  We Must Create Health Insurance Exchanges.  Individuals and small employers should be permitted to purchase health insurance on state-wide "exchanges" which would offer health insurance at a uniform rate to all customers.

3.  Insurance Must Pay for Preventive Care.  Health insurance should pay for preventive health care.  This should help to keep us in better health, thus reducing spending on health care.

4.  We Must Create Wellness Programs.  For the same reason, there should be incentives for people to adopt a health lifestyle, and grants to employers and communities to create wellness programs.

5.  The Government Should Establish Best Medical Practices and Standard Protocols.  The government should encourage the development of "best medical practices" and ensure that these practices are followed.

6.  We Must Expand the Use of Information Technology.  Information technology should be maximized both to streamline medical care (making information available throughout the health care system) and to reduce the cost of billing and payment to health care providers.

     However, there are a number of areas where lawmakers have yet to reach a consensus.

1.  Who May Participate in the Exchange, and Should It Be State-Wide or National?  Some of the bills would allow only individuals and small businesses to purchase insurance through the Exchange.  Other proposals would allow mid-size employers to participate – and there is support for allowing everybody to purchase insurance through the Exchange.  Supporters of expansion believe that this is the best way to promote competition and bring down costs.  Opponents fear that it would destroy the system of employer-based insurance.  There are similar arguments in favor and against creating a national exchange.  Premiums would be lower if there were a national marketplace for health insurance because consumers would have more bargaining power relative to insurers, and insurers would have more bargaining power relative to physicians.  On the other hand, a national market could not be regulated by state insurance commissioners, and the tradition of state regulation of insurance would be abandoned in favor of national regulation. 

2.  Will There Be a Public Option and If So, to Whom Will It Apply?  Will the government create an insurance program like Medicare or Medicaid to cover middle-class Americans who have not reached retirement age?  Proponents claim that this would reduce health care expenditures because of lower administrative costs.  Opponents fear a government "takeover" of medical care.

a.  Universal, Opt-In, or Opt-Out?  Would the public option automatically be available in every state, would states have to affirmatively choose whether to participate, or would states have to take steps to refuse to participate in the program?  There is political benefit to allowing each state to decide what it prefers – but proponents of the public option fear that any opportunity for a state to "opt-out" of public insurance would unnecessarily harm people who would benefit from low-cost government health insurance.

b.  Date Certain or Trigger?  The bills currently pending in Congress that contain a public option would have the program commence automatically in 2013 or 2014.  But there is additional support among Republicans and conservative Democrats for a public option that would be "triggered" either by a lack of competition among private insurers within a state or by rising health care costs within a state. 

c.  Mandated Reimbursement Rates or Negotiated Rates?  Under the public option, would rates be set by the Department of Health and Human Services as they presently are for Medicare, or would the government have to negotiate rates with doctors and hospitals the way that private insurers do?  Mandated rates would be lower than negotiated rates, but doctors and hospitals are more likely to support and participate in a program where they have the right to negotiate their fees.

3.  What Should be the Scope of the Individual Mandate?

a.  Extent of the Mandate?  Will every person be required to purchase health insurance, or will there be broad exceptions for people who do not want it or who cannot afford it?  If healthy people are not required to purchase insurance, or if people don't purchase health insurance until they are injured or become ill, then the pool of people who are insured will be relatively sicker, thus raising the average cost of health insurance for everybody.

b.  Penalty for Noncompliance?  How much will people be fined if they do not comply with the mandate?  Again, without a sufficient penalty, there will be "adverse selection" – people will make no contribution to pay for health care while they are healthy; instead they will purchase health insurance only when they become sick.

c.  Level of Subsidies?  How much will the government contribute so that low-income people can afford to pay for health insurance?  The Senate Finance Committee bill saved money by reducing the level of subsidies.  Obviously that approach imposes a hardship on people who are barely getting by today.

4.  Should There Be an Employer Mandate?  Will employers be required to provide health insurance?  If so, the same three questions arise for them – the extent of the mandate, the penalty for noncompliance, and the level of subsidies available from the government to help pay for health insurance. 

5.  How Will We Pay for Subsidies or for the Public Option?  Current bills identify three possible revenue sources: raise taxes on high income earners, charge an excise tax on expensive health insurance policies, or impose a tax on the sale of medical devices.  Another possibility that is not included in any of the proposed bills is to reduce the tax exemption for employer-based health insurance.

     Most analysts expect that Pelosi and Reid will finalize the House and Senate bills within the next few days.  And then we'll see!

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     If Congress does nothing, physicians will experience a 20% reduction in the reimbursements that they receive from Medicare.  The cause of this reduction is a federal law that establishes the "Sustainable Growth Rate" formula for changes in Medicare payments.

     The SGR formula is established by law and is used to calculate annual changes to the rates that doctors may charge Medicare for services.  Instead of simply allowing the reimbursement rate to increase in line with inflation, adjustments are made on the basis of the average of several factors, including changes in national worker productivity and changes in the Gross Domestic Product. 

     The "long version" explaining how the SGR is calculated may be examined in this article from the Congressional Budget Office published in 2006 and this 2009 report from the Centers for Medicare and Medicaid.

     The "short version" is much simpler.  For the past several years, the SGR formula would have mandated low increases or even reductions in physician fee schedules under Medicare.  Congress responded by overriding the changes to the fee schedule that would have been required by the SGR formula, and year-by-year enacted ad hoc increases for physicians participating in Medicare.  However, Congress never repealed the SGR formula, and under the law the changes mandated by SGR are cumulative – the scheduled reductions have built up to the point that Congress does not act physician's fee schedules will have to be reduced by more than 20% in 2010, with further reductions of about 6% annually stretching into the future.  This would certainly discourage physicians – and might discouage them from caring for Medicare patients altogether.

     From the standpoint of physicians, the cure, of course, is to abolish the SGR formula.  This is precisely what Senator Debbie Stabenow tried to do with her bill, S. 1776, the "Medicare Physician Fairness Act of 2009."   This very short bill abolishes the SGR formula and freezes physician reimbursement rates at present levels.  On October 21 this bill was defeated on a cloture motion 47-53, and Senator Stabenow released this statement vowing to continue to fight to bring the bill to the floor of the Senate.

     How much more will we spend on Medicare if the SGR formula is abolished?  The CBO answered this question in a letter dated October 26, 2009.  The CBO estimated that the government would save tens of billions of dollars annually if the fee reductions go into effect this year – as much as $42 billion in the year 2019 alone.

     On the other hand, Stabenow's bill would certainly be cheaper than having Congress enact annual increases in the Medicare reimbursement rate.

     In this article by Emily Walker of MedPage Today, it is suggested that SGR reform is a hostage of the broader package of health care financing reform.  Walker states:

On Wednesday, a cloture vote to end debate on the bill that would eliminate the sustainable growth rate (SGR) formula used to determine Medicare reimbursements to physicians was defeated in the Senate 53 to 47. Had it passed, the cloture vote would have moved the bill itself, sponsored by Debbie Stabenow (D-Mich.), to a vote.

…

The AMA, a major backer of the SGR bill, said it was "deeply disappointed," but earlier in the week, the group's president had refused to back the Finance Committee's healthcare reform bill, the quid in a rumored quid-pro-quo deal trading a vote on the SGR bill for support on the broad reform package.

     If a physicians suddenly throw their backing behind one of the health care financing reform bills, it will probably be because the bill has been amended to abolish SGR.

The University of Akron School of Law will host a lecture by leading tax authority Rick Grafmeyer, a 1982 graduate of Akron Law on Thursday, Nov. 5 at 5 p.m. in Room 152. The event is free and open to the public.

Grafmeyer is currently a partner with Capitol Tax Partners, Washington D.C.’s largest independent consulting firm specializing in tax legislative and regulatory matters. He served as chief tax advisor to Sen. John McCain during the 2008 Presidential election. From 1998 to 2000, he was deputy chief of staff of the Joint Committee on Taxation (JCT) and was responsible for major simplification study (three volumes), and separate studies on Tax Code penalty and disclosure provisions and tax-exempt organizations issued by JCT.

In the 1990s, Grafmeyer was nominated to the Social Security Advisory Council by President Clinton and was the deputy republican staff director of the Senate Finance Committee. He also served as senior republican tax counsel for the Senate Finance Committee and was responsible for general business tax issues, tax-exempt organizations, employee benefits, tax accounting, and IRS compliance.

Prior to his work on Capitol Hill, Grafmeyer was a partner in Arthur Andersen's National Office of Federal Tax Services and the leader of the firm's legislative practice and involved in regulatory and administrative issues before the Treasury Department and the Internal Revenue Service.  He also was a partner with Ernst & Young and National Director for Washington Tax Services focusing on tax issues before Congress or pending within Treasury or the IRS.

 Grafmeyer is also a frequent commentator on tax and budget issues for CNN, CNBC, and PBS Nightly Business News.

     At 3:15 today Senate Majority Leader Harry Reid (D-NV) announced that the bill he will send to the floor of the Senate will include both the "public option" as contained in the Senate HELP Committee bill and the "co-ops" proposed in the Senate Finance Committee bill.  The bill will also give individual states the power to opt out of the public option.  He is sending the bill to the CBO for scoring.

     On October 7 the Supreme Court heard oral argument in the case of Salazar v. Buono, which involves the constitutionality of a cross that had been erected on public land.  More below.

     The Mojave National Preserve in California is a vast federal park, roughly fifty miles square, located in eastern California.  In 1934 a World War I veteran erected a large cross as a war memorial on a cliff in the Preserve.  In 1994 the land was transferred from the Bureau of Land Management to the National Park Service, and the Park Service has continued to maintain the cross.  

     In 2002, a federal district court ruled that the maintenance of the cross on public land was a violation of the Constitution, and it prohibited the government from permanently displaying the cross.  Congress responded to the lawsuit by declaring the cross to be a National Memorial (like the Washington Monument or Mount Rushmore), and in 2004 Congress enacted legislation transfering about an acre of land around the cross to the VFW in return for five acres of privately owned land elsewhere in the Preserve.  The government contends that after the land swap the VFW could continue to display the cross   The district court and the Ninth Circuit Court of Appeals ruled that this land swap would not satisfy the injunction, and that it would still be unconstitutional to display the cross within the federal park.

     The legal standard that governs Establishment Clause cases is very simple.  The government may not endorse religion.  This standard has two prongs.  The government may not intend to endorse religion, and the primary effect of the government's action must not be to endorse religion.  But as this case demonstrates these straighforward rules are often difficult to apply.  Here are some of the perplexing constitutional questions that this case raises:

1.  At the time that the cross was erected in 1934, it may have seemed appropriate to many people to use only a Christian symbol to honor the war dead.  I remember sectarian prayers being used in public settings when I was a child in the 1950s.  Today, I don't think that anyone including the VFW would consider it appropriate to build a war memorial using only Christian symbols, any more than it would be appropriate to open or close public ceremonies with prayers in the name of Jesus Christ, rather than in a more ecumenical spirit.  Should we evaluate possible violations of the Establishment Clause in light of practices that were acceptable in 1787 when the Constitution was written, 1868 when the Fourteenth Amendment was adopted, at the time that the particular symbol was erected (in this case, 1934) – or under the standards that would be acceptable today, when we have a different understanding of what it means for the government to be "neutral" with respect to religion?

2.  This particular monument is important to local veterans.  Many veterans moved to the region to recuperate from wounds, and appreciate the existence of a war memorial.  The cross is also used by local congregations on Easter for sunrise services.  Do these facts indicate that the cross has a secular purpose and effect, or that the purpose or effect of the cross is religious in nature?

3.  Soon after the property was transferred to the National Park Service a Bhuddist group asked that Bhuddist shrine be added to the site, but the government refused the request.  Does that fact properly bear on analyzing the government's purpose in maintaining the cross?

4.  Finally, what about the government's proposed solution in this case?  May the government cure a constitutional violation caused by a religious sybmol on government land by giving away a small parcel of land containing the symbol to a private group that it expects is going to maintain the symbol in place?

    The case was argued before the Supreme Court on October 7.  During oral argument there was a good deal of discussion regarding the procedural posture of the case – whether the precise issue under review relates to the constitutionality of the trial court's entry of an injunction or the court's enforcement of its injunction.  That distinction matters because it changes the standard of review from "de novo" to "abuse of discretion," which would make it more difficult to reverse the trial court's decision.  There was also some quarreling about whether the government could still contest Mr. Buono's "standing" to challenge the constitutionality of the cross, or if the government had waived that argument by failing to appeal the entry of the original judgment in 2002.  After several minutes of wrangling over these procedural issues, the Chief Justice said to Soliciter General Elena Kagan:

CHIEF JUSTICE ROBERTS: Before we get -before your time expires, we would like to spend a couple of minutes on the merits.

(Laughter.)

     Justice Ginsburg posed several penetrating questions.  Early on, she asked:

JUSTICE GINSBURG: General Kagan, just as a factual matter, is there any other national memorial that consists of a solitary cross, just that one symbol and no other?

     The answer, of course, was no.

     Ginsburg also asked whether the VFW could take down the cross under the terms of the land swap, and in light of the fact that the cross is now a national memorial:

JUSTICE GINSBURG: Could they then substitute whatever other memorial they chose? … Or would there have to be some government approval?

     Soliciter General Kagan answered that the under the terms of the land swap the VFW has to maintain some kind of war memorial on the site.  She thought that the VFW could remove the cross and substitute some other form of war memorial without government permission, although she conceded that there was "a little bit of a dispute" on this point.

     Chief Justice Roberts asked how far the government can go in "swapping land" like this:

CHIEF JUSTICE ROBERTS: What if the government sold simply one square foot, or whatever the area that the base of the cross is — is resting on the ground? Would your argument be the same?

     Soliciter General Kagan admitted that there were limits to how far the government could go in this regard – that the government must have a secular purpose for the land swap, and that it must not appear that the religious symbol was still on government land. 

     Justice Sotomayor asked Peter Eliasburg, the A.C.L.U. attorney for Mr. Buono, the person who challenged the constitutionality of the cross and the land transfer, whether it would be a violation of the Constitution for one of the private landowners in the park to put up a similar cross on private property.  Eliasburg admitted that private landowners in the park could display such a cross, but he contended that this case was different because the government had intentionally transferred the land to the VFW for the purpose of keeping the cross in place. 

     Justice Scalia indicated to Attorney Eliasburg that he thought that the symbol of the cross adequately represents all war dead, regardless of their religion:

JUSTICE SCALIA: It's erected as a war memorial. I assume it is erected in honor of all of the war dead. It's the — the cross is the — is the most common symbol of — of — of the resting place of the dead, and it doesn't seem to me — what would you have them erect? A cross — some conglomerate of a cross, a Star of David, and you know, a Moslem half moon and star?

MR. ELIASBERG: Well, Justice Scalia, if I may go to your first point. The cross is the most common symbol of the resting place of Christians. I have been in Jewish cemeteries. There is never a cross on a tombstone of a Jew.

(Laughter.)

MR. ELIASBERG: So it is the most common symbol to honor Christians.

JUSTICE SCALIA: I don't think you can leap from that to the conclusion that the only war dead that that cross honors are the Christian war dead. I think that's an outrageous conclusion.

MR. ELIASBERG: Well, my — the point of my — point here is to say that there is a reason the Jewish war veterans came in and said we don't feel honored by this cross. This cross can't honor us because it is a religious symbol of another religion.

     Eliasburg also was asked whether similar large crosses in Arlington Cemetary represented an "establishment of religion."  He responded that Arlington Cemetary was different because there are so many different religious symbols that adorn the graves of the fallen soldiers there, and that no-one could reasonably draw the conclusion that the government was singling out any single religion for honor.

     Near the end of the oral argument Chief Justice Roberts asked a question about the origin of this particular cross:

CHIEF JUSTICE ROBERTS: Counsel, this probably doesn't have anything to do with anything, but I'm just kind of curious, why is this cross put up -you know, in the middle of nowhere?

(Laughter. )

MR. ELIASBERG: Because the man who originally put up the cross — not this one, because it has been replaced a number of times, but the man who put up this particular cross, I believe was a homesteader in the area when the land was owned by the Bureau of Land Management, and I believe was a miner on the land. I hope that is correct historically.

     The Court's decision in this case could clarify some significant questions that arise under the Establishment Clause when religious symbols are placed on public land.

     Below the fold are a link to a story about the President declaring the H1N1 epidemic to be a national emergency, and links to reports from the Centers for Disease Control about the epidemic.

     Fox News reports that President Obama has declared the H1N1 viral epidemic to be a national emergency, which should facilitate the ability of hospitals and clinics to handle the expected surge in admissions.

     The CDC is publishing reports and updates about the H1N1 virus.  The "2009 H1N1 Flu: Situation Update" webpage contains general information and links to a number of CDC reports.  One specific report entitled "Novel H1N1 Flu: 2009 Early Outbreak and Disease Characteristics" contains charts and data regarding symptoms, the infection rate, hospitalization rate, and death rate in the American population.  One result that was surprising to me – the bulk of the deaths are not among infants and the very elderly, as is usually the case with the flu, nor among teenagers and young adults, as I had believed was true of H1N1.  Instead, 40% of the deaths from the virus are in the 25-49 age group.  Get your shots!

     Health care financing reform legislation has been approved by five separate congressional committees – three in the House and two in the Senate.  Next week the President and leaders in Congress are likely to merge the various proposals into one bill that will go forward in the House and the Senate.  The Commonwealth Fund has released a report comparing the bills that are pending in Congress, and from which the ultimate bill will be forged.  In this post I summarize the principal findings contained in this report.  In addition, I invite you to visit a website I have created with information and links to other sources regarding health care financing reform.

     According to the Commonwealth Fund, there are eleven areas where the various health care bills are in broad agreement, and five areas where there are substantial differences among the bills.  In each case the quoted language is from the report, and the remainder constitutes my own words summarizing the report:  

1.  "Individual mandate" – All of the bills would require individuals to have health insurance coverage.  The Senate bills impose a penalty of $750 on individuals who refuse to purchase health insurance, while the penalty under the House bill would be "2.5% of the difference between the tax filing threshold and MAGI up to the average national premium."  Forgive me for not knowing what that means, but the report indicates that this amount would be higher than $750. 

2.  "Insurance exchange" – Each of the bills would create a regulated marketplace through which individuals and small businesses could purchase coverage.  Under the House bill the exchange would be a single national market regulated by the federal government, while under the Senate bills there would be separate exhanges in each state regulated by state agencies following federal guidelines.

3.  "Premium and cost-sharing subsidies" – Under each bill persons earning above 133% and below 400% of the federal poverty level would receive subsidies to purchase health insurance.  The amount of the subsidies varies slightly among the bills, principally on a sliding scale from 100% for the poorest persons in this group to no more than 12% of income for those at 400% of the federal poverty level.

4.  "Insurance market regulations" – Insurance ratings for health and gender would be prohibited, and insurance ratings for age would be limited.  Lifetime limits would be abolished.  Annual out-of-pocket expenses for medical care (co-pays and deductibles) would be limited to various amounts; a typical maximum level for out-of-pocket fees is $5000 for individuals and $10,000 for families.  Insurance policies would have to meet minimum standards as to coverage and "loss ratio," that is, the percent of the policyholders' medical expenses that would be covered by insurance. 

5.  "Essential standard benefit package standard" – Health insurance policies sold through the exchange would have to offer comprehensive coverage including medical, prescription drugs, pediatric dental and vision, and preventive care.

6.  "Medicaid / CHIP expansion" – Persons earning below 133% (or, under the Senate HELP bill, 150%) of Federal Poverty Level would qualify for Medicaid and CHIP.

7.  "Pilot programs for rapid cycle testing of innovative payment methods" – Under Medicare the government intends to experiment with creating managed care programs and "medical homes" that would coordinate care through a single clinic or physician.

8.  "Creating a national quality improvement strategy" – Each of the bills seeks to improve and coordinate quality improvement efforts.  The House bill would create a new agency, the Center for Quality Improvement, which would "identify, develop, evaluate, disseminate, and implement best practices; develop national priorities for performance improvement and quality measures."  The Senate Finance Committee bill would authorize the Department of Health and Human Services to undertake this responsibility, and the Senate HELP Committee bill provides grants for improving the efficiency of the health system.

9.  "Improving primary care reimbursement" – The Senate Finance Committee bill would increase primary care reimbursement rates by 10%.  The House bill would increase primary care reimbursement by 5% generally and 10% in underserved areas.   

10.  "Center for Comparative Effectiveness Research" – A government agency will identify best medical practices and propose protocols and standards both for medical care and for improvements in sharing medical information.

11.  "Create and expand wellness and prevention programs" – Under each of the bills, health insurance policies would be required to cover preventive health care, and would forbid insurance companies from requiring co-pays or deductibles for preventive care.  Each of the bills would also provide for grants in various formats for wellness programs or wellness incentives.

     The report also identifies five areas where there are significant differences among the bills:

1.  "Choice of public plan in exchange" – The House bill and the Senate HELP Committee bill would create a "public option," a government run health insurance company similar to Medicare, except that people would have to purchase coverage from the government agency.  Under the House bill doctors and hospitals would be paid Medicare rates plus 5%.  Under the Senate HELP bill the government would negotiate reimbursement rates with medical care providers.  The Senate Finance Committee bill would allow individuals and small employers to create "co-ops" to purchase health insurance, but it does not provide for a government-run health insurance program.

2.  "Employer shared responsibility" – The House bill and the Senate HELP Committee bill require large employers to either offer a specified level of health insurance coverage or to pay a portion of their employees' health insurance premiums if the employer does not offer health insurance.  The Senate Finance Committee bill does not set standards for employer-sponsored health insurance plans, but it does require large employers to pay a percentage of the cost for their uninsured workers to purchase health insurance on the exchange.  Small businesses (defined variously as businesses with less than 25 employees or with payrolls lower than $500,000) are exempt from having these requirements.

3.  "Changing the Sustainable Growth Rate formula for Medicare physician fee update" - This is a big ticket item.  Doctors and hospitals want predictable rules for the annual adjustment to reimbursement rates under Medicare.  The House bill includes this provision which has a cost of $229 billion over ten years, but the Senate Finance Committee bill does not address this subject.  This is the principal reason that the House bill is evaluated as "more expensive" than the Senate Finance Committee bill.  The House bill would provide larger increases in payment for primary care physicians than for specialists.

4.  "Medicare Commission to extend Medicare solvency, slow Medicare cost growth and increase quality of care" - The Senate Finance Committee bill would establish an independent commission to provide recommendations to Congress on achieving cost savings under Medicare.

5.  "Sources of revenue: surcharges on higher income vs. excise tax on high cost health plans" – The House bill imposes a surtax on high income earners, defined as individuals earning over $280,000 or families earning  over $350,000 annually.  This will generate an additional $50 billion annually.  The Senate Finance Committee bill imposes a 40% excise tax on expensive health insurance policies; those costing over $8,000 for an individual or over $21,000 for a family of four.  This tax would generate an additional $20 billion annually.

     Finally, the Commonwealth Fund report states that the House bill will offer health insurance coverage to an additional 35 million people, while the Senate Finance Committee bill will cover somewhat fewer people – 29 million people who are currently uninsured. 

     It will be fascinating to watch as President Obama and Democratic leaders in Congress decide which elements of health care financing reform to include in the bills that will go forward in the House and Senate, and how rank and file members of Congress will respond.

     I have created a website containing links to agencies and organizations with information about health care financing reform, as well as to the most significant studies and reports that have been issued on the subject.  Please visit the website and return here to offer your comments and suggestions for improving the site.