Georgia’s landmark consumer-directed health care reform law has come under fire in a study conducted by the Center on Budget and Policy Priorities (CBPP), a liberal activist group that claims the reform will help only Georgians who already have health insurance coverage.
Experts disagree, saying the Georgia law, signed by Gov. Sonny Perdue (R) on May 10, should serve as a model for other states’ attempts at reform.
The law was passed to make health insurance more available and affordable by removing premium taxes from high-deductible plans, giving tax breaks to individuals and small employers, and allowing insurance companies to provide financial incentives for beneficiaries who live healthier lifestyles.
‘Next Generation Health Insurance’
“CBPP fails to understand the movement to next-generation insurance products with rewards and incentives for wellness, prevention, and compliance with physician-established treatment plans,” said Ron Bachman, president of Healthcare Visions, Inc. “The new Georgia laws eliminate state government taxes that only increase costs and the number of uninsured.”
CBPP claims the incentives will reward those who already have coverage instead of helping the uninsured. “The incentives are too small to encourage people and companies to buy additional or new health care,” said Judith Solomon, a senior fellow at CBPP and author of the report. “It’s not to say that there won’t be anybody that gets the benefit of this–but it’s going to be very modest.”
“To argue that legislation that lowers the cost of health insurance will not encourage more people to purchase health insurance ignores the fundamental laws of economics,” Bachman responded.
“Roughly three-quarters of all health care spending in Georgia is related to individuals with chronic disease,” Bachman continued. “Providing financial incentives and rewards for healthy behavior will not only lower the cost of health insurance for those individuals but will hopefully reduce the number of Georgians developing chronic disease in the future.”
Ignoring Major Accomplishments
Kelly McCutchen, vice president of the Georgia Public Policy Foundation, disagreed with Solomon’s research methods and conclusions.
“The study completely ignores two major accomplishments of the legislation: eliminating tax discrimination at the state level for those who do not have access to employer-provided insurance, but instead purchase health insurance themselves, and the elimination of Georgia’s prohibition on rewards and incentives for healthy behavior and compliance with disease management plans,” McCutchen said.
Among their many benefits, the new laws exempt insurers who provide high-deductible health plans that include health savings accounts from having to pay state and local taxes on the premiums charged for those policies. (See “Ga. Consumers Get More Control over Health Insurance, Care,” Health Care News, July 2008.)
The laws also allow people to deduct from their state income taxes the amount paid in premiums–exemptions and deductions that are expected to save insurers and consumers nearly $150 million per year.
Consumer Choice, Protection
“The Georgia legislation retains all existing state mandates and consumer protections,” said Bachman. “The direction Georgia has taken is to ensure the uninsured an affordable, comprehensive insurance plan.
“The definition of affordability is changed,” Bachman noted. “It is no longer the amount of money one pays in premiums; now it includes the financial rewards and incentives to offset premiums and deductibles, and to provide additions to increase health savings accounts.
“For the first time, HSA-eligible plans can have any deductible gap filled in by good health behaviors and health treatment compliance,” Bachman added. “HSA-eligible plans can no longer be criticized as only for the young, healthy, and wealthy. A new generation of products is on the way, and Georgia is leading the way.”
“Both parts of the new Georgia law are good for consumers and taxpayers, because they put money back in the pockets of individuals, giving them the power to make choices about how they spend or save it,” said Sharon Harris, founder of Advocates for Self-Government.
More Reforms Expected
“One of the primary critiques [in the CBPP] study is that there are no subsidies for low-income Georgians,” said McCutchen. “Although this is an important segment of the uninsured, due to the expense of addressing this part of the population it will likely require cooperation with the federal government.
“This plan was clearly designed to address the large and growing number of Georgians who have recently been priced out of the market, those with chronic disease, individuals without access to employer-provided insurance, and the young and healthy who choose not to purchase insurance,” McCutchen explained.
“Our next challenge will be those who cannot afford health insurance without some form of subsidy and those who are uninsurable,” McCutchen said.
There are options available to lawmakers seeking to reduce the number of uninsured and to reduce the cost of health coverage, Harris said: “First, allow consumers to shop for insurance across state lines. By creating a more competitive environment, we would very quickly lower the cost of premiums. Second, give tax credits to employers and consumers equal to the cost of their premiums.
“The more we get government out of the industry, and the more choice we give consumers, the better off everyone will be. Free-market solutions always work better to solve problems than the tiny ‘band-aid’ approaches of bureaucrats and politicians,” Harris concluded.
Jeff Emanuel (emanuel@heartland.org) is The Heartland Institute’s research fellow for health care policy and managing editor of Health Care News. Krystle Russin (krystle@purepolitics.com) writes from Texas.
Medicare participants who have diabetes or congestive heart failure as well as depression have significantly higher health care costs than their counterparts who do not have co-existing depression, according to a recent NIMH-funded analysis.
Background
Jurgen Unutzer, M.D., MPH, of the University of Washington, and colleagues analyzed Medicare claims of 14,903 participants for a 12-month period between November 2004 and August 2006. The participants were enrolled in a pilot Medicare disease management program called Medicare Health Support, operated by Green Ribbon Health in Florida. The majority of participants had diabetes. Many had congestive heart failure. About 20 percent had both.
The researchers compared health care costs for three groups—
* 2,108 participants who had been diagnosed with depression,
* 1,081 participants not officially diagnosed with depression but who screened positive when given a questionnaire or who reported taking antidepressant medication, and
* 11,713 participants who did not have depression.
Results of the Study
Over one year, participants diagnosed with depression incurred about $22,960 in total health care costs, while those without depression incurred costs of about $11,956. Those with possible depression, based on depression screening or reported antidepressant use, incurred $14,365.
Participants with diagnosed depression spent significantly more in nearly every health care cost category, including home health care, skilled nursing facility costs, outpatient care, inpatient care, physician charges, and medical equipment. However, they did not spend more money on specialty mental health care compared to their non-depressed counterparts. Mental health care costs accounted for less than 1 percent of total health care costs.
Significance
The results indicate that among these Medicare beneficiaries with chronic medical illness, those who also have depression have significantly higher health care costs. Moreover, many in this high-risk group are not getting needed mental health care, the researchers said. The researchers theorize that the higher Medicare cost-sharing associated with outpatient mental health care—50 percent compared to 20 percent co-payments for medical services—may be a major obstacle to such care. In addition, older adults may be less likely to seek mental health care if they perceive a stigma associated with it. The researchers conclude by suggesting that improving mental health care for this population may help decrease overall medical costs.
What’s Next
The results echo findings of other studies that have found health care costs tend to be higher for people in managed care situations who have depression. More research is needed to better understand the barriers to care, and efforts are needed to improve the quality and access to mental health care for older adults in managed care situations.
The health insurance crisis is hitting every nook and cranny of the United States from Indiana to California and now Texas. Health insurance premiums are skyrocketing causing many middle-income Texans to simply forgo health insurance coverage at all.
A study conducted by researchers at the University of Minnesota found that from 2000 to 2008 the number of uninsured middle-income Texans increased by 40 percent. Researchers define middle-income as families that earn between $48,000 and $85,000 annually.
Currently. 10.8 million Texans receive health insurance from their employers. Over half of these people earn more than $88,000 a year. However, 15 percent of employers in the private sector do not offer health insurance. Furthermore, a 5.5 percent drop in employer-sponsored insurance has also occurred.
The situation has made for an interesting trend: more middle-income households are simply dropping health insurance coverage altogether. According to Devon Herrick of the Dallas-based National Center for Policy Analysis . “They just do see a good value in [health insurance]”. It’s a common trend across the nation. Consider that forty percent of households in the nation go without insurance and earn more than $50,000 annually.
Health Insurance Reform May Become a Reality
Texans and Americans nationwide may benefit from a healthcare overhaul despite the costs. The push for health insurance reform by the Obama Administration has been an uphill battle. However, a determined Obama will most likely get his way. Should the legislation pass, Americans can look for radical changes in the health insurance industry – changes that providers are less than happy to accommodate.
For example, under the Obama plan, discrimination because of a pre-existing medical condition would be banned as would dropping a customer because his or her health bills are too much. The plan would also end lifetime caps on coverage and reduce out-of-pocket expenses making health insurance more affordable for everyone.
Democrats are expected to vote on health insurance reform in the near future. President Obama, meanwhile has been traveling the country to provide one less sell before he leaves the country for Indonesia. Democrats must win by a simple majority for the bill to pass.
The World Health Organization (WHO) has issued a health warning to Europeans on Friday due to the falling ash from the eruption of Icelandic volcano under the Eyjafjallajokul glacier The ash is coming down in Norway and Scotland, and is expected to move southward throughout Europe. In particular, those with respiratory conditions should stay indoors unless it is absolutely necessary to go outside.
Ash is made up of fine particles of fragmented volcanic rock. It can have an acidic coating that can cause itchy eyes, minor skin irritation, sore throat or dry cough in most people. In addition, volcanic eruptions also release sulfur dioxide and other gases. A study of people living near the Hawaiian volcano Kilauea found that those exposed to the gases had a higher rate of similar symptoms plus an increased risk of diagnosed bronchitis.
But those with conditions such as asthma, emphysema, COPD, or heart disease are at a greater risk. The particles can lead to irritated airways, causing them to compress, or cause the lining to make more secretions inducing coughing and heavy breathing.
Volcanic ash also contains silica, which can cause chronic health conditions such lung disease and heart problems. Inhaling silica can lead to a condition called silicosis, an incurable, irreversible scarring of the lungs that progresses even after exposure has ended. Silicosis also increases the risk of developing lung cancer.
Those in the area closest to the volcano are obviously at a greater risk. Authorities in Iceland are warning people living under the ash plume to use masks and protective goggles when outside.
Some organizations do not expect any long-term effects from the volcanic ash. Britain’s Health Protection Agency says that the concentration of ash particles that reach the ground “is likely to be low and not cause serious harm.” The International Volcanic Health Hazard Network say that there is “almost no risk to people” from this particular ash eruption, because the ash will dilute as it crosses the oceans and waterways as it travels outward from Iceland.
Health officials are certain that the ash will not cause any ill health effects in the United States, except, however, for the acute stress travelers might feel from not being able to fly into or out of European airports because the ash is too dangerous for aircraft to fly through.
Mexico probably has the best travel health insurance in the world. We can say that it’s the most affordable as well. The country has unveiled a free health insurance program against swine flu to protect its tourism industry.
The swine flu fears have made the European and American tourists to think twice when traveling to the Mexican capital. The images of deserted streets and closed businesses are still in the memory of tourists. Therefore, the government of Mexico City is now launching a message of calm in the form of a free health insurance program for tourists.
“This health insurance is to cover any person who may contract the virus in our city and needs coverage,” Mayor Marcelo Ebrard said when presenting the Tourist Assistance Card. However, NY Times writes that the fine print of the proposal says that the treatment will be offered at “authorized establishments” and that in some cases an unspecified deductible will be charged.
Visits by foreign nationals not only bring life to Mexico City, but also an important source of income in a country where tourism is vital to sustain the economy and daily life of its inhabitants. The insurance will cover medical, accident or illness, ambulance, hospitalization, medical emergency and if there is need the prescription drug costs. Additionally, it will also provide coverage for dental emergencies, repatriation and even for urgent phone messages.
Mexico City’s travel health insurance will also provides legal assistance for lost or stolen documents or belongings.
Until now, Mexico has recorded 142 deaths due to influenza A. At first, most of these cases were recorded in the Federal District, but now the tide has shifted to the southeastern states like Chiapas. With this measure, the mayor of Mexico City Ebrard tries to heal the tourist health fears to attract those who still come to Mexico City.
The Spanish language newspaper El Mundo writes that this special swine flu health insurance measure is ainly addressed for the Europe because “the Americans have already passed the reluctance.” Restaurants and other entertainment venues are still on alert. They have posters that remind to wash your hands at least once during your stay, and teach how to do a hand hygiene properly.
The hotels in Mexico City finally lifted their heads above the waters and reaches 59% occupancy. There were times that no one would ask you to take a picture in front of the main cathedral or in front of major museums. But now, you can see some tourists back in the city. It is expected that Mexico City’s swine flu travel health insurance will cover seven million visitors.
