NRL News
Page 1
January 2010
Volume 37
Issue 1

Health Care Proposals Contain Numerous Rationing Components

By Jennifer Popik, J.D.

Both the House and Senate have passed bills fraught with rationing concerns, with negotiations now having moved behind closed doors. Having circumvented the conference process, Democratic congressional leaders will work out differences between the House and Senate version among themselves with no input from Republicans. Their expressed goal is to pass a final bill to send to President Obama to sign by February’s Presidential State of the Union Address.

The following is a list of important rationing elements in the two bills.

Robbing Peter to Pay Paul

Neither bill contains sustainable, adequate financing. Overpromising while underfunding health insurance for the uninsured will almost surely lead to rationing when, down the road, government has to face the shortfall. Both the Senate and House bills are ripe with elements that can enable this rationing.

Limiting Senior Citizens’ Right to Use Their Own Money to Save Their Own Lives

The House and Senate have duplicate provisions that would effectively allow federal bureaucrats at the Centers for Medicaid & Medicare Services (CMS) to bar senior citizens from adding their own money, if they choose, to the government contribution in order to get Medicare plans less likely to ration lifesaving treatment.

Medicare—the government program that provides health insurance to older people in the United States—faces grave fiscal problems as the baby boom generation ages. Medicare is financed by payroll taxes, which means that those now working are paying for the health care of retirees. As the baby boom generation moves from middle age into old age, the proportion of the retired population will increase, while the proportion of the working population will decrease. The consequence is that the amount of money available for each Medicare beneficiary, when adjusted for health care inflation, will shrink.

Rather than facing rationing or huge tax increases, the shortfall could be made up by payments from older people themselves. Currently there is a private fee-for-service insurance option within the Medicare Advantage alternative. People who choose this latter option could finance their Medicare health insurance premium partly by the government’s contribution (derived largely from payroll taxes) and partly from their own income and savings.

However, Senate Bill Section 3209 and House Bill Section 104 empower the CMS to refuse to allow senior citizens access to these private fee-for-service plans (or any other Medicare Advantage plan) altogether, for any reason or no reason. The ability of seniors to spend their own money to have access to plans less likely to ration their care faces potential elimination under either bill.

Limiting Many People’s Right to Use Their Own Money to Save Their Own Lives

Denial of the right to spend one’s own money to save one’s own life is not limited to people on Medicare. Insurance “exchanges” in the bills are meant to create an organized marketplace in which to buy insurance to help facilitate competition and the expansion of coverage to more people. Originally, they were designed to allow comparison shopping among all insurance plans that provide the basic benefits.

Under Senate Bill Section 1003 and House Bill Section 104, however, exchanges would be authorized, in effect, to limit the value of the insurance policies that Americans using the exchanges may purchase. This will effectively allow state bureaucrats to limit the right of Americans who are NOT on Medicare to use their own money to save their own lives.

Not only will the exchanges be allowed to exclude policies when government authorities do not agree with the size of premiums, but they will also be able to reject plans based on rates they charge in the regular market. This would create a “chilling effect,” deterring insurers who hope to be able to compete within the exchange from offering adequately funded plans in the free market, thus limiting consumers’ access to adequate and unrationed health care. These day-to-day rationing decisions will have the most direct and visible impact on the lives—and deaths—of people with a poor “quality of life.”

Instead of allowing Americans themselves to balance the cost of insurance plans with the benefits and quality they offer when choosing among competing health plans in the exchanges, their choice would be subject to potentially drastic restrictions. There would be clear limits on Americans’ ability to choose to spend their own money for health insurance that they judge will be less likely to deny treatments and otherwise ration care.

A Powerful Rationing Board

The Senate bill creates a powerful “Independent Payment Advisory Board.” This is a significant step closer to the powerful Federal Reserve Board-like Federal Health Board envisioned by former Senate Majority Leader Tom Daschle, President Obama’s original nominee for health czar.

As one of its tasks, this board is directed to ensure that Medicare spending increases at a rate significantly below that of medical inflation. To the extent the CMS projects that growth in Medicare spending would exceed this target, the board would have to act to reduce the gap by specified percentages that would vary by year. This gap-reducing would likely be done by reducing Medicare Advantage benefits, payments to doctors, and so forth.

Disturbingly, the board is also directed to make recommendations to “slow the growth” in private (non-federal) health expenditures, recommendations that the Department of Health and Human Services (HHS) or other federal agencies will be permitted to impose on private insurance plans and health care providers. This will further limit the ability of private citizens to spend their own money to protect their own lives, by obtaining health care or health insurance that is not rationed. While the House bill does not contain this board, the cost savings this type of board promises may earn it a place in the final bill.

Using “Comparative Effectiveness” to Deny Coverage

Generally speaking, so-called “Comparative Effectiveness Research” makes direct comparison of health treatments to determine which work best for which patients and which pose the greatest benefits and harms. Both the House bill and the Senate bill set up centers tasked with analyzing this data and making recommendations about what treatments work, and ultimately, which ones the government will pay for.

The problem is that there is great danger when the government is authorized, whether through “comparative effectiveness” research using “quality-adjusted life years” or other measures, to compel or encourage denial of lifesaving medical treatment, food, or fluids based on the patient’s age, disability, or “quality of life.” There is language in the Senate bill that would forbid use of comparative effectiveness data to deny treatment discriminatorily based on disability, age, or terminal illness. However, this important language is absent from the House version. Therefore, there is no guarantee that this protective provision will be included in any final bill passed by Congress.

Imposition of “Quality” and “Efficiency” Regulations

The important language in the Senate bill that protects against discriminatory use of comparative effectiveness research on the basis of age, disability, or terminal illness has not been made applicable to the multiple provisions under which the HHS secretary can impose “quality” and “efficiency” on all health care providers.

Much of the professional literature advocates the use of “quality of life” standards that devalue the lives of older people and people with disabilities in such measures. While there are limits on the use of comparative effectiveness research to justify denial of treatment based on quality of life criteria under of the Senate bill, the quality and efficiency measures are not made subject to these critically important anti-discrimination protections.

Advance Care Planning, by One Name or Another

The House and Senate bills each contain different dangerous Advance Care Planning provisions, all of which may ultimately end up in the final version.

There had been considerable public outrage over the Section 1233 advance care planning provisions in the House bill. This section would fund recurring voluntary consultations with seniors and could be used to “nudge” patients toward accepting denial of treatment as a means to control costs.

The House bill does not stop here. Section 240 requires end-of-life planning information to be disseminated to policy holders by all health plans in the exchange.

The Senate bill does not contain these House provisions, but contains an even broader provision for “Shared Decisionmaking” under Section 3506. This provides funding to develop “patient decisionmaking aids” that are supposed to help “patients, caregivers or authorized representatives ... to decide with their health care provider what treatments are best for them based on their treatment options, scientific evidence, circumstances, beliefs, and preferences.”

The Department of Health and Human Services will contract with an “entity” that is supposed to rely on some “broad consensus” to develope the materials people receive. The long term goal is to standardize the way that health providers talk with their patients about advance planning according to the unaccountable “entity’s” recommendations.

There is language stating the materials are to be “balanced,” but the concern is the same as with the promotion of advance care planning. Given the strong views many in the medical community have about poor “quality of life” and the considerable emphasis on saving costs, these measures will in fact subtly or otherwise “nudge” the elderly and those with low “qualities of life” in the direction of rejecting costly lifesaving treatment.

Cumulatively, these and other provisions pose the great threat ever to the ability of those who are ill or injured, people with disabilities, and older people to obtain essential lifesaving medical treatment.