Grading America’s Private Health Insurance Plans

When the Affordable Care Act is fully implemented in 2014, Americans will finally have the opportunity to purchase private insurance through one of the new state-based insurance exchanges. As I, and others, have said, the best way to think about this is to imagine the exchange like a travel website (e.g., Orbitz, Expedia, Travelocity) with insurance plans playing the role of airline carriers. If you were planning a trip, you’d go online and find the itinerary or airline that you prefer. Similarly, for health insurance, you would visit the exchange, shop around, and select the plan that’s right for you.

One of the big things this does is makes information on price and benefits more transparent, hopefully leading to free-market competition that will help to keep health care costs low. Of course, recognizing that the benefit design of most health insurance plans is extremely complex, and that the attention span of most Americans is extremely short, the government also set a benchmark for plans to help consumers know what they’re getting. Based on the plans’actuarial value, or how much of the covered group’s medical care is paid for by the plan, an insurance plan may be designated as platinum (90% and above), gold (80-89%), silver (70-79%), or bronze (60-69%).Subtracting the actuarial value from 100% tells you how much the insured collectively pay in premiums, deductibles, and other out-of-pocket costs for the care they receive. As of 2014, all insurance plans participating in the exchange must offer at least the minimum bronze level coverage of 60%.

All of this begs the question: What are private health insurance plans covering now? Of course, it varies by plan, but Jon Gabel and colleagues recently studied this issue, and report their findings in the latest Health Affairs. I have created a graphic from some of their data here.

 

As you can see, there are a variety of health plans out there, and some don’t measure up to the government’s criteria for a bronze plan. These especially ungenerous plans are labeled by Gabel et al. as “tin” plans. What is particularly striking, is how much worse the individual health insurance market is compared to the group health insurance market. What these data show, in my opinion, is how much members of the individual market will benefit from having the opportunity to become part of a purchasing group. Full implementation of the insurance exchanges can’t get here fast enough if you ask me.

 

Belated Link to Health Wonk Review

The latest Health Wonk Review has been up and running for a while at Jaan Sidorov’s Disease Management Care Blog. I am just now getting around to posting the link here. You should not wait to check it.

 

How Much Weight Should Anecdotes Really Have In Health Policy?

There’s something compelling about the personal narrative that vast mountains of quantitative data cannot rival. Anecdotes are, quite simply, powerful. They tap into our shared humanity, making something seem somehow more real by putting a face on it. This is why, if you follow politics for very long, you will find numerous cases of policymakers championing issues that have touched their own lives in some way. For example, Senator X doesn’t care about issue Y, until they discover that their son or daughter is affected by it. Then, almost overnight, they seem to care more about issue Y than almost anything else. Such a shift is completely understandable, but often out of proportion to the true scale of the issue in society.

In health policy, the personal narrative can also be very powerful. In fact, the journal Health Affairs routinely runs a “Narrative Matters” section that puts a face on the health care issues of the day. It is absolutely critical that health policymakers, health services researchers, and others, not lose sight of the fact that their work and the subsequent decisions it informs, are based on real people. However, it is equally critical for objectivity to be maintained, and narrative can threaten our work in this regard.

As an example, Tom Perkins recently wrote in the Wall Street Journal about his ongoing battle with prostate cancer in his eighties. His article takes issue with recommendations from the U.S. Preventative Health Service that call for moving away from prostate cancer screening (the PSA blood test). It’s hard to argue with his case, specifically, because he had an aggressive form of prostate cancer that was caught early and is being treated with at least moderate effectiveness. Had he not been screened, the cancer would most likely have killed him. You can see why he would consider the U.S. Preventative Health Service to be a “death panel” (his words, not mine).

The problem is that Tom Perkins is an anomaly. The overwhelming majority of prostate cancer is not aggressive. This is why you may have heard the saying “Most men die with prostate cancer, not of prostate cancer.” One of the greatest things about health services research is the opportunity it affords to step back from the trees and take stock of what is happening to the forest. What we discover then leads us to confront more philosophical questions. For example, are we okay with paying for 100 people to be screened for something that will only help 1 of them? If you were making this decision the way you make decisions about most everything else you buy, you’d want to know some things. For instance, how much does the screening test cost? If the test isn’t done, what else could the money be used for? How accurate are the results of the test? How much will the 1 person be helped? Do I know the 1 person? Am I the 1 person?

These questions represent the continuum from purely objective research to very subjective personal anecdote. They all deserve to be answered, and each answer informs our decision-making in a different way. Unfortunately, when people espouse one extreme or the other, which is admittedly much easier to do than holding the two in tension, something very important gets lost.

 

Analysis Suggests Affordable Care Act Will Reduce Racial Disparities in Coverage

The Affordable Care Act is one specific thing that attempts to reform the health care system by doing a great number of things. At the most fundamental level, it is about increasing insurance coverage. It goes about this by expanding the Medicaid program, providing subsidies to individuals to help them purchase insurance, requiring everyone to have coverage, prohibiting insurance companies from denying people coverage, and allowing young adults to remain on their parents’ insurance until age 26. The most notable thing that it does not do, is provide coverage to undocumented immigrants.

Using microsimulation techniques–a fancy term for a fancy computer model that allows researchers to make assumptions and see the simulated results–a team at the Urban Institute, led by Lisa Clemans-Cope, Genevieve Kenney, and Matthew Buettgens, found that the Affordable Care Act will reduce racial disparities in insurance coverage. Their findings are reported in the May issue ofHealth Affairs.

Specifically, of the nearly 269 million Americans who are under age 65 and therefore mostly ineligible for Medicare, 13.9% of whites are uninsured, compared to 21.6% of blacks, 33.3% of Hispanics, and 18.5% of Asians and others (combined). When the ACA is fully-implemented, the percentage of each group that is uninsured will drop significantly, and the decrease will be larger among racial minority groups than among whites, narrowing the gap between these groups. The team at the Urban Institute reports that, in the wake of the ACA, 6.5% of whites will remain uninsured, compared to 9.8% of blacks, 21.1% of Hispanics, and 10.4% of Asians and others (combined). That means the black-white gap will narrow by 4.4 percentage points, the Hispanic-white gap will narrow by 4.8 percentage points, and the Asian/other-white gap will narrow by 0.8 percentage points.

To the extent that insurance coverage translates to access to health care, and access to health care translates to better health outcomes, it would appear, based on these results, that the insurance coverage provisions of the Affordable Care Act have the potential to significantly reduce racial disparties in health. And that’s good news.

 

Hypocrisy Is Handsome

The State of North Carolina is getting ready to vote next week on, among other things, Amendment One, which would amend the state constitution to make anything other than heterosexual marriages unlawful domestic unions. Translation: It would make gay marriage unconstitutional (and do lots of other things that are very harmful, as a friend of mine recently pointed out). I don’t live in North Carolina anymore, so I won’t be voting on this, but plenty of my friends do, and some of them happen to be gay. Suffice it to say that they have been rather outspoken against the proposed amendment on Facebook and elsewhere. I actually don’t have a terribly strong opinion on this issue, as I’m: a) already married; and b) to a woman.

Since I’m not planning to get gay married, gay marriage isn’t a pressing issue for me. Sure, we can talk about the morality of civil rights issues, and that’s all well and good, but I’m not sure if being gay is the same thing as being black or being female. Some people think it is. Some people think it isn’t. And I just don’t know. But, for the sake of argument, let’s say I was in North Carolina next week, and I voted FOR Amendment One. Would it not then be hypocritical of me to go out and attempt to get married to another man? What if I voted for some pro-life legislation, only to turn around and beg my pregnant partner to have an abortion? All clear-cut hypocrisy.

So, I was rather surprised to learn that Sen. Scott Brown (R-MA), who replaced Sen. Ted Kennedy after his death, and who almost derailed the health reform effort by voting against the Affordable Care Act, has actually used provisions of the law to provide health insurance to his 23-year-old daughter, Ayla. He might as well have voted against ice cream and then asked for two scoops of chocolate when it didn’t work. What that should underscore is that the Affordable Care Act is already doing a number of great things. Things so good, in fact, that even people who opposed them want in on the action.