Breaking news and significant developments in health care and health policy
Impact of Urban Hospital Closures in the US
October 17, 2025
The Government Accountability Office publicly released a report September 19 entitled “Urban Hospitals: Factors Contributing to Selected Hospital Closures and Related Changes in Available Health Care Services.”
As noted in GAO’s cover letter:
“Hospitals play a critical role in delivering health care services to their communities. In 2022, nearly 30 million patients were admitted to approximately 4,500 general acute care hospitals nationally, and spending on hospital services accounted for about $1.38 trillion, nearly one-third of the $4.5 trillion in total health care spending in the U.S.[1] As of 2022, approximately half of U.S. general acute care hospitals were located in an urban area.
“There were 118 hospital closures in both rural and urban areas from fiscal year 2019 through fiscal year 2023.[2] Closures of urban hospitals outpaced openings from 2019 through 2023, with 72 closures and 55 openings nationally in this time period.[3] Some of these recent urban hospital closures included a history of private equity investment.[4]“
For its report, the agency looked at five urban hospitals which closed in 2022 or 2023. They found:
“All five selected urban hospitals experienced multiple years of financial decline prior to closure due to financial losses or declining profits, according to representatives from these hospitals and our analysis of CMS Medicare Cost Report data.[22] Several other factors contributed to the hospitals’ financial decline and closure; these included low or declining inpatient volume, aging physical infrastructure, challenges operating as independent hospitals, poor management practices, and separate ownership interests (see fig. 1).[23]“
The report also notes:
“Some community residents continued to face challenges accessing health care services after the closure of all selected hospitals, according to stakeholders. Stakeholders reported an ongoing lack of transportation, primary care, and insurance coverage.
“Some community residents faced inadequate transportation options, and the closure of selected hospitals may have made travelling to obtain health care services more difficult, according to stakeholders for all five selected hospitals.[50] For example, stakeholders in hospital B’s community noted that traveling to a hospital located 4 miles from hospital B could be challenging without access to a vehicle, and one of them also said getting there requires crossing a river that was a barrier between communities in the city. In another community, a hospital located 4 miles from hospital E was accessible via public transportation; however, representatives said traveling there could still be challenging for community residents unable to pay for public transportation. Some hospitals we interviewed provided transportation assistance for residents in their communities. For example, a hospital located about 5 miles from hospital A provided financial assistance with transportation, but hospital representatives noted that funding for this assistance was limited.
“Some community residents relied on the emergency department for health care needs such as primary care, according to stakeholders for four selected hospitals (hospitals A, B, D, and E). Therefore, the closure of the selected hospitals’ emergency departments may have exacerbated access challenges for individuals without access to primary care providers.[51] In addition, some residents of hospital B’s community could have difficulty accessing health care services from providers after the hospital’s closure in part because they lacked awareness of other providers, according to hospital B representatives. In hospital A’s community, residents—many of whom were immigrants—identified with hospital A’s Christian mission, had built relationships over many years with its staff, and did not feel the same connection with other providers, according to stakeholders.
“The lack of insurance coverage was another ongoing challenge faced by some residents in the communities of at least three selected hospitals (hospitals A, D, and E), according to stakeholders.[52] Uninsured individuals are more likely to delay or forego health care for financial reasons.[53] Representatives of all three of these hospitals stated that many of their patients were uninsured. For example, hospital E was a safety-net hospital, and a hospital representative reported that 38 percent of its patients were uninsured in the year before it closed. When hospital E was in operation, a staff person was available to help its uninsured patients enroll in insurance coverage through Medicaid or Medicare, according to a hospital representative. In addition, an estimated 20 percent of residents were uninsured in the cities where hospitals A and D were located.[54] Uninsured residents in hospital D’s community faced greater challenges accessing health care services after the hospital closed, according to one stakeholder, and the uninsured in other communities where selected hospitals closed may have faced similar challenges.”
European Health Forum Gastein 2025 September 30-October 3
September 9, 2025
Both in-person and virtual registration is still open for the European Health Forum Gastein 2025, which is being held September 30 through October 3 in Bad Hofgastein, Austria. The theme for this year’s forum is “Rethinking solidarity in health: Healing Europe´s fractured social contract.”
There are fees for in-person attendance. Virtual attendance is free of charge. Details are available at the EHFG2025 website.
Medicare, Prior Authorization, and a Six-State Trial of AI
September 8, 2025
The US government is preparing to trial the use of artificial intelligence, large language models, and machine learning in a prior authorization review process for medical procedures under the Medicare program.
The New York Times reports (Reed Abelson and Teddy Rosenbluth, “Medicare Will Require Prior Approval for Certain Procedures,” NY Times, August 28, 2025):
“The federal government plans to hire private companies to use artificial intelligence to determine whether patients would be covered for some procedures, like certain spine surgeries or steroid injections. Similar algorithms used by insurers have been the subject of several high-profile lawsuits, which have asserted that the technology allowed the companies to swiftly deny large batches of claims and cut patients off from care in rehabilitation facilities.
“The A.I. companies selected to oversee the program would have a strong financial incentive to deny claims. Medicare plans to pay them a share of the savings generated from rejections.
“The government said the A.I. screening tool would focus narrowly on about a dozen procedures, which it has determined to be costly and of little to no benefit to patients. Those procedures include devices for incontinence control, cervical fusion, certain steroid injections for pain management, select nerve stimulators and the diagnosis and treatment of impotence.”
The Times notes further:
“The program, called the Wasteful and Inappropriate Service Reduction Model, is already drawing opposition from Democratic lawmakers, former Medicare officials, physician groups and others.
“Patients are also leery. ‘I think it’s the back door into privatizing traditional Medicare,’ Ms. Ayres said.
“People enrolled in traditional Medicare who live in Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington State will be included in the experiment, which is expected to start in January and last for six years.
“Dr. Vinay Rathi, an Ohio surgeon and an expert in Medicare payment policy, warned that the experiment could recreate the same hurdles that exist with Medicare Advantage, where people enroll in private plans. ‘It’s basically the same set of financial incentives that has created issues in Medicare Advantage and drawn so much scrutiny,’ he said. ‘It directly puts them at odds with the clinicians.’
“Typically, these A.I. models scan a patient’s records to determine if a requested procedure meets an insurer’s criteria. For instance, before authorizing back surgery, the system might search for proof that a patient first tried physical therapy or received an MRI showing a bulging disc.”
WHO Releases World Health Report 2025
May 15, 2025
The WHO released its World Health Report 2025 on May 15, 2025. According to the WHO:
“An estimated 1.4 billion more people were living healthier by the end of 2024, surpassing the 1 billion target. The progress in healthier lives was driven by reduction in tobacco use, improved air quality and better access to water, hygiene, and sanitation. But progress towards increased coverage of essential health services and protection from emergencies lagged; only 431 million more people gained access to essential health services without financial hardship, and close to 637 million more people were better protected from health emergencies.
“Maternal and child deaths are not falling fast enough to reach global targets. Progress has stalled, putting millions of lives at risk. This slowdown follows two decades of remarkable gains: between 2000 and 2023, maternal deaths dropped by over 40% and child deaths under 5 years of age more than halved. But underinvestment in primary health care, shortages of skilled health workers, and gaps in services like immunization and safe childbirth are now holding countries back.”
The WHO also noted:
“Premature deaths from NCDs [Non Communicable Diseases]—such as heart disease, stroke, diabetes, and cancer—are rising, driven by population growth and aging, and now account for most deaths among people under the age of 70, worldwide. The world is currently off track to reduce NCD premature mortality by one-third by 2030. Progress has been possible where governments and civil society have committed to action: tobacco use is declining, and global alcohol consumption dropped from 5.7 to 5.0 litres per capita between 2010 and 2022. Air pollution remains one of the top causes of preventable death worldwide. The impact of poor mental health continues to hold back progress.
“Recovery in essential health services remains incomplete. A shortfall of 11.1 million health workers is still projected by 2030, with nearly 70% of the gap concentrated in the WHO African and Eastern Mediterranean regions.”
The full report, World health statistics 2025: monitoring health for the SDGs, sustainable development goals, can be downloaded in full for free from the WHO website.
WHO: Nursing workforce grows but disparities in access persist
May 15, 2025
A new report issued May 12 by the World Health Organization finds that “1 in 7 nurses worldwide – and 23% in high-income countries – are foreign-born, highlighting reliance on international migration.”
The WHO reports that: “The global nursing workforce has grown from 27.9 million in 2018 to 29.8 million in 2023, but wide disparities in the availability of nurses remain across regions and countries, according to the State of the World’s Nursing 2025 report, published by the World Health Organization (WHO), International Council of Nurses (ICN) and partners.”
The full report, State of the world’s nursing 2025: investing in education, jobs, leadership and service delivery, can be downloaded in full for free from the WHO website.
WHO: Health inequities are shortening lives by decades
May 15, 2025
A new report issued May 6th by the World Health Organization finds that “underlying causes of ill health often stem from factors beyond the health sector, such as lack of quality housing, education and job opportunities.”
According to the WHO, the new World report on social determinants of health equity shows that “such determinants can be responsible for a dramatic reduction of healthy life expectancy – sometimes by decades – in high- and low-income countries alike. For example, people in the country with the lowest life expectancy will, on average, live 33 years shorter than those born in the country with the highest life expectancy. The social determinants of health equity can influence people’s health outcomes more than genetic influences or access to health care.”
The full World report on social determinants of health equity can be downloaded in full for free from the WHO website.
Gallup: 11% of US Adults Unable to Afford or Access Quality Healthcare
April 2, 2025
Eleven percent of US adults are unable to afford or access quality healthcare, according to new research by Gallup and West Health.
According to Gallup (“In U.S., Inability to Pay for Care, Medicine Hits New High,” April 2, 2025, last accessed April 2, 2025):
“The most notable increases since 2021 have occurred among Hispanic adults (up eight percentage points to 18%), Black adults (up five points to 14%,) and the lowest-income households, earning under $24,000 per year (up 11 points to 25%). Meanwhile, there has been no meaningful change in the proportion of White adults or middle- to high-income earners facing the same level of struggle. As a result, disparities in access to healthcare based on race, ethnicity and income are also at their highest point since surveying began.”
Gallup reports:
“While the Cost Desperate category has reached its highest level yet, the percentage of adults classified as Cost Secure — able to access and afford quality healthcare has reached its lowest level, with only about half of Americans (51%) falling into this category.
“The demographic groups who saw the biggest drops are Hispanic adults (down 17 points to 34%) and Black adults (down 13 points to 41%). Meanwhile, the percentage of White adults categorized as Cost Secure (58%) is consistent with 2021 levels, providing further indication of the widening of the race/ethnicity gap in access to high-quality affordable healthcare.”
The research also found that fewer Americans can access affordable, quality care when needed:
“One of the three metrics that constitute the Affordability Index is being able to access affordable, quality care when needed. More than one-third of Americans (35%) report that they are unable to access quality, affordable healthcare, four points higher than in 2023 and a new high since 2021.
“While households earning under $48,000 annually have always reported more difficulty accessing affordable healthcare, the difficulty has worsened considerably in the past year, climbing by 11 points (to 64%) among those in households earning under $24,000 and 12 points (to 57%) among those in households earning $24,000 to less than $48,000.”
Healthcare Policies in US States: The Washington Cares Fund
March 6, 2025
The Washington Cares Fund is a long-term care insurance program operated by the state of Washington. According to the WA Cares Fund website (accessed March 6, 2025), “All working Washingtonians contribute a small percentage of their income into the fund. Then when you need care, you can access your earned benefit of $36,500 (adjusted up to inflation) to pay for services.”
According to the Washington State Standard (“Initiative to roll back Washington’s long-term care program fails,” Nov. 5, 2024), “The program applies a 0.58% tax on the paychecks of workers in Washington. Beginning in July 2026, those who qualify can begin accessing the program’s benefit, a lifetime amount of $36,500 — a sum that is set to rise in future years to account for inflation. The benefit can be used toward expenses like caretaking, equipment, medication and meals.”
WA Cares Fund benefits are also portable, thanks to a law signed by WA Governor Jay Inslee in March of 2024. According to the Washington State Governor’s Office (“Washington’s first-in-the-nation long-term care benefit is now portable,” May 16, 2024):
“Beginning in July 2026, Washington workers can continue to participate in the WA Cares Fund if they move out of state. Workers who paid in for at least three years of 500 hours worked may opt into out-of-state coverage within a year of leaving.
“Like in-state workers, out-of-state participants will keep contributing to the fund during their working years. Benefits will become available to out-of-state participants who need care starting in July 2030.”
More information about the WA Cares Fund can be found at the Washington State Office of the Insurance Commissioner and at the WA Cares Fund website.
US Healthcare Spending Hits $4.9 Trillion
December 18, 2024
US healthcare spending continues to grow. According to an article in the journal Health Affairs (Anne B. Martin, Micah Hartman, Benjamin Washington, Aaron Catlin, and The National Health Expenditure Accounts Team, National Health Expenditures In 2023: Faster Growth As Insurance Coverage And Utilization Increased, Health Affairs (2024), doi.org/10.1377/hlthaff.2024.01375):
“National health care spending reached $4.9 trillion in 2023 (or $14,570 per person), increasing 7.5 percent from 2022 (exhibit 1). This rate of growth was faster than in 2021 and 2022, when health care spending increased 4.2 percent and 4.6 percent, respectively. The lower growth during 2021 and 2022 was affected by the expiration of temporary federal funding associated with the COVID-19 pandemic (which was initiated in 2020 and was associated with a 10.4 percent increase in health spending in that year). In 2023, as the public health emergency ended and little COVID-19 federal funding remained, the acceleration in spending growth largely reflected increased use of health care goods and services, which influenced the strong growth in both private health insurance and Medicare spending. In addition, private health insurance enrollment increased and Medicaid enrollment levels remained high, leading to an insured share of the population that reached 92.5 percent (exhibit 2).”
In regard to payers, the authors found that “In 2023, state and local governments accounted for a higher share of spending than in 2022, whereas the federal government share was lower as COVID-19-related funding declined and federal Medicaid spending growth slowed. Nevertheless, of the $14,570 in per person health spending in 2023, the federal government accounted for the largest share, at 32 percent ($4,689 per person). Households paid for 27 percent ($3,942 per person), private businesses accounted for 18 percent ($2,677 per person), state and local governments another 16 percent ($2,279 per person), and other private revenues the remaining 7 percent ($983 per person) (exhibit 5).”
The authors noted that “the acceleration in total national health spending growth in 2023 was primarily driven by faster growth in the three largest categories: hospital care, physician and clinical services, and retail prescription drugs. Hospital spending increased 10.4 percent in 2023, following much slower growth of 3.2 percent in 2022, and spending for physician and clinical services increased 7.4 percent in 2023, following growth of 4.6 percent in 2022 (exhibit 4). In both instances, the acceleration reflected an increase in nonprice factors, such as the use and intensity of services, after notably slower growth in 2022 (data not shown). Retail prescription drug spending also contributed to the acceleration, increasing 11.4 percent in 2023 from a rate of 7.8 percent in 2022 (exhibit 4), largely because of changes in the mix of drugs dispensed toward higher-cost, newer brand-name drugs10 and faster growth in retail prescription drug prices.11“
Support Grows for Government-Run Health System
December 9, 2024
Gallup recently released results from its annual Health and Healthcare Poll, which are based on telephone interviews conducted November 6-20, 2024 with a random sample of 1,001 adults living in the US. The new data show that support for the US adopting a government-run healthcare system is growing.
According to Gallup (Jeffrey M. Jones, “More in U.S. See Health Coverage as Government Responsibility,” Gallup, Dec. 9, 2024):
“Americans divide about evenly on this question, with 46% saying the U.S. should have a government-run healthcare system, while 49% are in favor of a system based mostly on private health insurance. Only in a 2017 survey were Americans as closely divided as they are today. In most years, majorities — as high as 61% — favored a system based on private insurance.”
The survey has a margin of error of +/- 4%.
Gallup also found that a majority of adults support the Affordable Care Act:
“Fifty-four percent of U.S. adults approve of the ACA, essentially tying the record-high 55% readings in April 2017 (during Republican-led attempts to repeal the law) and November 2020 (after Joe Biden won election as president). Approval has generally been 50% or above since Obama left office in 2017, but the law was far less popular during his tenure, ranging from 37% to 48% approval.”
The survey found that while people are generally pleased with their own health care and health coverage, a large number feel that the US health system has major problems. According to Gallup (Megan Brenan, “View of U.S. Healthcare Quality Declines to 24-Year Low,” Gallup, Dec. 6, 2024):
“The current 44% of U.S. adults who say the quality of healthcare is excellent (11%) or good (33%) is down by a total of 10 percentage points since 2020 after steadily eroding each year. Between 2001 and 2020, majorities ranging from 52% to 62% rated U.S. healthcare quality positively; now, 54% say it is only fair (38%) or poor (16%).
“As has been the case throughout the 24-year trend, Americans rate healthcare coverage in the U.S. even more negatively than they rate quality. Just 28% say coverage is excellent or good, four points lower than the average since 2001 and well below the 41% high point in 2012.”
Yet also according to Gallup:
“In contrast to their largely negative assessments of the quality and coverage of healthcare in the U.S., broad majorities of Americans continue to rate their own healthcare’s quality and coverage positively. Currently, 71% of U.S. adults consider the quality of healthcare they receive to be excellent or good, and 65% say the same of their own coverage. There has been little deviation in these readings since 2001.”
This contradiction also extends to feelings regarding healthcare costs. On one hand, according to Gallup:
“In addition to registering subpar ratings of the quality and coverage of healthcare in the U.S., few Americans — 19% — say they are satisfied with its cost. This reading is unchanged from last year and toward the low end for the measure, which has averaged 22% since 2001. The high point in satisfaction was 30% in 2020, during the COVID-19 pandemic. This spike was largely due to an increase in satisfaction among Republicans.”
And yet, Gallup also notes:
“Americans are also much more likely to express satisfaction with what they pay for healthcare than with the total cost of care in the U.S. Fifty-eight percent are now satisfied with their own costs, down from the high point of 67% in 2020 but in line with the trend average.”
Nearly One Fourth of Working Age Adults Underinsured, New Report Shows
November 22, 2024
The Commonwealth Fund on November 21, 2024 released a new report on insurance coverage in the US. According to The State of Health Insurance Coverage in the U.S.:
“• More than half (56%) of U.S. working-age adults were insured all year with coverage adequate to ensure affordable access to care. But there are soft spots requiring policy attention: 9 percent of adults were uninsured, 12 percent had a gap in coverage over the past year, and 23 percent were underinsured, meaning they had coverage for a full year that didn’t provide them with affordable access to heath care.
“• Among adults who were insured all year but underinsured, 66 percent had coverage through an employer, 16 percent were enrolled in Medicaid or Medicare, and 14 percent had a plan purchased in the marketplaces or the individual market.
“• Nearly three of five (57%) underinsured adults said they avoided getting needed health care because of its cost; 44 percent said they had medical or dental debt they were paying off over time.
“• Delaying care has health consequences: two of five (41%) working-age adults who reported a cost-related delay in their care said a health problem had worsened because of it.
“• Nearly half of adults (48%) with medical debt are paying off $2,000 or more; half of those with debt said it stemmed from a hospital stay.”
Source: Sara R. Collins and Avni Gupta, The State of Health Insurance Coverage in the U.S.: Findings from the Commonwealth Fund 2024 Biennial Health Insurance Survey (Commonwealth Fund, Nov. 2024). https://doi.org/10.26099/byce-qc28
World Health Systems Facts is on BlueSky
November 14, 2024
World Health Systems Facts now has an account on the social media platform BlueSky. We are at:
https://bsky.app/profile/healthsystemsfacts.bsky.social.
Nonprofit Hospitals and Charity Care
November 7, 2024
Two new reports throw light on the level of charity care actually provided by nonprofit hospitals in the US.
As noted in US Nonprofit Hospitals Have Widely Varying Criteria To Decide Who Qualifies For Free And Discounted Charity Care (Luke Messac, Alexander T. Janke, Lisa Herrup Rogers, Imani Fonfield, Jared Walker, Elijah Rushbanks, Nora V. Becker, and Ge Bai, US Nonprofit Hospitals Have Widely Varying Criteria To Decide Who Qualifies For Free And Discounted Charity Care, Health Affairs 2024 43:11, 1569-1577):
“Hospital charity care is the provision of free or discounted services to low-income patients.5 Historically, a large part of the justification for nonprofit hospitals’ tax-exempt status rests on their provision of charity care to low-income patients. The Affordable Care Act required nonprofit hospitals to have a written and publicly available financial assistance policy but did not specify how much charity care a hospital must provide, or what the eligibility policy should be.”
The amount of care provided varies as does the manner in which such care is defined by hospital systems. According to the authors, “In this nationwide analysis of private nonprofit hospitals’ charity care policies, we found that in the absence of any federal regulations specifying charity care eligibility criteria, hospitals have chosen numerous and widely varying criteria to decide who qualifies for free and discounted charity care. This large variation results in disparities in access to charity care and warrants attention from state and federal policy makers interested in improving both nonprofit hospitals’ accountability to taxpayers and low-income patients’ access to charity care.”
Among their findings:
“We found that a majority of hospitals (54 percent) investigated assets in determining eligibility for charity care. Some hospitals did take steps to mitigate potential harm from this requirement by excluding necessities such as primary residence, retirement savings, and vehicles used for basic transportation when measuring assets.
“Most hospitals also reported significant documentation requirements. Such requirements are likely part of the reason why, in a survey of 1,600 patients, Dollar For found that roughly one-quarter of patients who had applied for charity care believed the application to be “somewhat hard” or “very hard.”19 Patients convalescing from hospitalizations are particularly vulnerable to administrative burdens such as documentation, which still must often be submitted in hard copy through the mail or by using a fax machine.
“A sizable minority of hospitals reported residency requirements and restrictions on charity care for insured patients. Although hospitals did generally allow charity care in cases of hardship, this criterion tended to be rather strict. The median hospital required a bill to amount to 20 percent of the patient’s income before consideration was granted on this basis.”
A new report from Rice University’s Baker Institute for Public Policy examines nonprofit hospitals and charity care in the state of Texas. As noted in Nonprofit Hospitals and Medical Debt in Texas (Derek Jenkins, Nonprofit Hospitals and Medical Debt in Texas, October 31, 2024, Baker Institute for Public Policy), “In Texas, hospitals typically offer free care to families earning 200–300% of the FPL and discounted care to those earning between 400–500% of the FPL. While the eligibility requirements are set by hospitals, the IRS also requires that these eligibility requirements are readily available to patients. These requirements are usually posted on the hospital’s website. In most cases, hospitals require eligible patients to apply for financial assistance.”
Unfortunately, it’s difficult to determine the actual level of so-called bad debt attributable to patients who qualify for charity care. According to the report:
“IRS Form 990 federal tax filings are completed at the employer identification number (EIN) level. Some hospitals file as a system or a group, while others file independently. As a result, occasionally bad debt data is not available for individual hospitals, although charity care and profit margins are always presented at the hospital level.
“The share of total bad debt expense that Texas hospitals estimated was attributable to patients qualifying for charity care ranged from 0% to as much as 84.9% in 2019. This represents $127 million dollars in total bad debt for patients who should have received such assistance. This figure likely underestimates the situation. Of the 111 nonprofit hospitals in our sample, only 32 reported any amount (greater than $0) for bad debt tied to patients eligible for charity care on their filings. Thirty-five hospitals reported $0, and for 44, we were unable to identify any such data. For hospitals that reported more than $0, the bad debt for these patients represents 14.7% percent of all bad debt. If we include hospitals that estimated $0, this share falls to 5.4%.
“Beyond the lack of reporting on bad debts, there is also uncertainty about how these estimates are calculated. Hospitals are required to report their estimation methods, but many simply estimate a percentage of bad debt attributable to patients eligible for charity care. Baptist Hospitals of Southeast Texas, which includes Baptist Beaumont (Table 1), estimates that 25% of bad debt is attributable to eligible patients, and explains the estimation process as follows: ‘The business office estimates the percentage of patients that would qualify for assistance based on conversations with those patients that do not complete the application.'”
The report concludes:
“Data availability was a significant limitation of this study. Reporting of bad debt attributable to patients eligible for charity care is sporadic and unreliable. The IRS allows hospitals to use multiple methods to estimate bad debt and charity spending, which makes comparisons difficult.
“• Although Texas hospitals provide relatively high levels of charity care compared to the rest of the country, patients who should have been eligible for charity care accounted for 5.4% to 14.7% of total bad debt.
“• Many Texas hospitals left the charity care field blank on their IRS Form 990 federal tax filings. Even when hospitals did report estimates, most claimed that no patients eligible under their policies received a bill.
“• Hospitals report their methods for estimating bad debt attributable to patients eligible for charity care on their Form 990 tax filings.
“• Many hospitals that report $0 in this field seem to assume that all patients eligible must have applied for financial assistance, because financial assistance policies are posted near registration areas and available online.”
Doximity Releases 2024 Physician Compensation Report
October 16, 2024
The physician networking, communications, and staffing company Doximity has released its 2024 Physician Compensation Report.
According to Doximity, “Doximity found that after several years of modest or declining growth, the average pay for doctors increased nearly 6% in 2023, rebounding from a decline of 2.4% in 2022.”
The report noted that “In 2023, the gender pay gap for physicians decreased to 23%, marking a slight improvement from the 26% reported in 2022. Despite this progress, the pay gap remains significant, with women physicians earning nearly $102,000 less than men physicians, on average, after controlling for specialty, location, and years of experience.”
Doximity noted that workload and physician burnout are serious concerns. According to the report:
“Consistent with prior years’ findings, feelings of overwork continue to be more prevalent in women physicians. Among women physicians surveyed, 89% reported they are overworked, compared with 77% of men physicians, 82% of women NPs and PAs, and 78% of men NPs and PAs. Women physicians are also more likely to report exploring a career change, with 70% considering early retirement, another career, or another employer, compared to 55% of men physicians.
“Overwork also appears to be more prevalent in younger physicians, with 89% of physicians age 29 and under reporting they feel overworked. Physicians 29 and under are likely trainees, who are often tasked with the longest hours for the least pay. Many of these physicians also started their training or attending careers at the peak of the pandemic, which likely contributed to their overall stress and workload. 5 As a result, 55% of physicians in this age group are already considering early retirement or looking at other career options.”
Commonwealth Fund Releases Newest Installment of its Mirror Mirror Series of National Health System Comparisons
September 21, 2024
The Commonwealth Fund has released the newest installment of its Mirror Mirror series, which compares various national health systems with the US.
According to Mirror, Mirror 2024: A Portrait of the Failing U.S. Health System:
“Key Findings: The top three countries are Australia, the Netherlands, and the United Kingdom, although differences in overall performance between most countries are relatively small. The only clear outlier is the U.S., where health system performance is dramatically lower.
“Conclusion: The U.S. continues to be in a class by itself in the underperformance of its health care sector. While the other nine countries differ in the details of their systems and in their performance on domains, unlike the U.S., they all have found a way to meet their residents’ most basic health care needs, including universal coverage.”
Baker Institute Report Examines Hospital Prices, Costs, and Profits
September 11, 2024
Rice University’s Baker Institute for Public Policy has issued a new report on hospital finances. The report, entitled Prices Versus Costs: Unpacking Rising US Hospital Profits, compares “the commercial operating costs, net patient revenue from commercial patients, and commercial operating profits of hospitals with different price levels to examine if higher prices are charged to cover higher costs, or instead to generate higher profits.”
They concluded:
“We find that belonging to the highest inpatient price quartile is associated with 17% higher costs per adjusted discharge and 36% higher commercial revenue per adjusted discharge. These differences result in a 69% higher commercial operating profit per adjusted discharge for the highest priced hospitals compared to those in the lowest price quartile. Similarly, hospitals in the highest price quartile for outpatient prices have 2%, 24%, and 66% higher commercial operating costs, revenue, and profits per adjusted discharge, respectively, compared to hospitals in the lowest price quartile.
“Hospitals with higher inpatient prices may have marginally higher costs than lower-price hospitals, they also earn substantially higher commercial revenues per adjusted discharge, leading to higher profits. Hospitals with higher outpatient prices earn significantly higher profits compared to those with lower prices. Meanwhile, higher outpatient prices are not associated with higher operating costs in our sample.
“Furthermore, our results suggest that high prices are not simply a response to high operating costs; rather, they are associated with larger hospital operating profits. To promote affordability in the health care system, negotiated rates for health services should remain a priority for policymakers.”
Health Policy Positions of Harris and Trump
September 5, 2024
KFF, formerly the Kaiser Family Foundation, has published an analysis of the health policy positions of the two major party nominees for US president in the 2024 election (KFF, Compare the Presidential Candidates’ Health Care Records and Positions, last accessed September 5, 2024), Kamala Harris and Donald Trump. The site is a live document so it will be updated throughout the election campaign. As noted at the site:
“The general election campaign is underway, spotlighting former President Trump, the Republican nominee, and Vice President Harris, the Democratic nominee, as the viable contenders for the presidency. Although health care reform may not be a central issue in this election as in the past, health care remains a significant concern for voters. Trump and Harris have distinctly different records and positions on health care. This side-by-side analysis provides a quick resource for understanding Trump’s presidential record and Harris’ [sic] record in the Biden-Harris administration and in previously held public office, as well as their current positions and proposed policies. Proposals are from when candidates served as president and vice president respectively unless text or links indicate otherwise. This tool will be continuously updated as new information and policy details emerge throughout the campaign.”
Topics covered as of September 5, 2024 include: Affordable Care Act, Medicaid, Abortion, Contraception, Maternity Care, LGBTQ Health, Gun Violence, Public Health, Prescription Drug Prices, Medicare, Health Care Costs, Mental Health, Opioid Use Disorders, Long-term Care, Global Health, and Immigrant Health Coverage.
Healthcare in the US Becoming Less Affordable
July 23, 2024
The number of Americans who could access affordable healthcare has declined in recent years, according to a new report by Gallup and the nonprofit West Health.
According to the report, entitled Tracking Healthcare Affordability and Value: The West Health-Gallup Healthcare Affordability Index and Healthcare Value Index:
“Cost security among U.S. adults has dipped to its lowest level in 2024, down six points since 2022 to just 55%. This decline is driven primarily by adults aged 50 to 64 (down eight points to 55%) and 65 and older (down eight points to 71%). Younger adults under the age of 50, after ticking up in 2022 to 52%, have slid to 47%. For all three age groups, these levels represent recorded low points for cost security.
“The remaining 45% of American adults are classified as either Cost Insecure or Cost Desperate. Adults under the age of 65 are more than three times as likely to be Cost Desperate as those aged 65 and older (10% to 3%). The percentage of those Cost Desperate aged 50 to 64 has ticked up to 10%, the highest level measured for this group thus far.”
They estimate that 8 percent of US adults are “Cost Desperate,” by which they mean:
“These persons report recent occurrences of being unable to pay for household care, being unable to pay for prescribed medicine and feeling that they would not have access to affordable quality care if needed today.”
Other research from the University of Michigan’s Institute for Healthcare Policy and Innovation’s National Poll on Health Aging reveals the impact these increasing costs are having on older adults.
According to the Institute’s new report, entitled Making Ends Meet: Financial Strain and Well-Being Among Older Adults:
“Overall, 16% of adults age 50 and older said that in the past year they had trouble paying for health insurance, prescription drugs, or health care services, or that they delayed getting or did not get needed health care. Those in fair or poor mental health were more likely than those in excellent, very good, or good mental health (35% vs. 14%) to have had trouble with the costs of health care. The same was true for those reporting fair or poor physical health compared with those with better physical health (29% vs. 13%).
“More than half of older adults (58%) took at least one action in the past year to reduce expenses or make money available for other purposes. Overall, 47% cut back on discretionary spending, 29% cut back on savings, 19% used credit cards without paying the monthly balance, 15% cut back on necessities, 10% borrowed money from family or friends, and 7% took out new loans or refinanced their home.”
Health Policy Positions of Biden and Trump [Editor’s Note: Update posted Sept. 5 2024]
June 29, 2024
KFF, formerly the Kaiser Family Foundation, has published an analysis of the health policy positions of the two major party candidates for US president in the 2024 election (KFF, Compare the Presidential Candidates’ Health Care Records and Positions, last accessed June 29, 2024). The site is a live document so it will be updated throughout the election campaign. As noted at the site:
“The general election campaign has commenced, spotlighting President Biden and former President Trump as the presumptive nominees for their respective parties and the currently viable contenders for the presidency. While this is not an election like in the past where health care reform is a central issue being debated, health care is an important issue for voters and Biden and Trump have sharply divergent records and positions. This side-by-side analysis serves as a quick resource for understanding each candidate’s record as president, positions, public statements, and proposed policies. It will be continuously updated as new information and policy details emerge throughout the campaign.”
Topics covered by KFF as of June 29 include: the Affordable Care Act, Medicaid, Abortion, Contraception, LGBTQ Health, Gun Violence, Public Health, Prescription Drug Prices, Medicare, Health Care Costs, Mental Health, Opioid Use Disorders, Long-Term Care, Global Health, and Immigrant Health Coverage.
The Washington Post also took a look at the healthcare policy positions of Biden and Trump (Washington Post, Inside the health arguments at Biden and Trump’s first debate, June 28, 2024). The Post noted:
“President Biden and former president Donald Trump began their first debate Thursday night arguing about their responses to the coronavirus pandemic. Each candidate closed the evening touting their respective health-care legislation — with Biden talking about his efforts to cut drug prices and Trump his program to expand access to experimental drugs for terminally ill people. During the roughly 90 minutes in between, the men wrestled over their stark differences on abortion access, the Affordable Care Act and other health-care priorities.”
Topics covered by the Post in this article include Abortion, Drug Pricing, the Affordable Care Act, Coronavirus, Medicare, and Medicaid.
New NY Times Investigative Series on Pharmacy Benefit Managers and High Prescription Drug Costs
June 21, 2024
The New York Times has begun a new series about how pharmacy benefit managers prioritize their own interests at the expense of patients, employers, and the public. Part one, entitled “The Opaque Industry Secretly Inflating Prices for Prescription Drugs,” was published June 21, 2024. According to the Times:
“The three largest pharmacy benefit managers, or P.B.M.s, act as middlemen overseeing prescriptions for more than 200 million Americans. They are owned by huge health care conglomerates — CVS Health, Cigna and UnitedHealth Group — and are hired by employers and governments.
“The job of the P.B.M.s is to reduce drug costs. Instead, they frequently do the opposite. They steer patients toward pricier drugs, charge steep markups on what would otherwise be inexpensive medicines and extract billions of dollars in hidden fees, a New York Times investigation found.”
The Times noted the size of these companies and their influence:
“If they were stand-alone companies, the three biggest P.B.M.s would each rank among the top 40 U.S. companies by revenue. The largest, Caremark, generates more revenue than Ford or Home Depot.
“Because of recent mergers, they are becoming more dominant, collectively processing roughly 80 percent of prescriptions in the United States. In 2012, the figure was less than 50 percent.”
One of the concerns reported by the Times involves the use of brand-name drugs versus generics:
“Perhaps the clearest example of how the P.B.M.s find creative ways to profit is Humira, the blockbuster medication for conditions like arthritis.
“After two decades of the brand-name drug being the only version available, lower-cost alternatives came on the market in 2023. Collectively, employers, insurance programs and patients stood to save up to $6 billion a year by switching to copycat drugs, according to the data company IQVIA.
“But P.B.M.s would lose money from switching. Humira had become a big moneymaker for P.B.M.s, in large part because its manufacturer, AbbVie, was shelling out hundreds of millions of dollars in fees to the benefit managers’ G.P.O.s. Those fees would vanish if the P.B.M.s switched patients off Humira.
“The P.B.M.s moved slowly. In March, 14 months after the first cheaper version became available, 96 percent of prescriptions for the drug in the United States were still for the brand-name version, according to IQVIA.”
Journalism Organizations Plan Webinar Series on Business of Healthcare
February 14, 2024
The Association of Health Care Journalists and Investigative Reporters & Editors, with the support of the NIHCM Foundation, are hosting a series of webinars for journalists on the business of healthcare.
The series is entitled “Follow the Money: The Business of Health Care.” The first webinar, “Using HospitalFinances.org and other tools to tell money stories,” will be 1-2 pm eastern on Wednesday, March 27. Here’s the rest of the schedule:
April 24, 1-2 pm eastern: “Digging into pricing: What does health care cost?”
June 26, 1-2 pm eastern: “Coverage 101: Understanding private health insurance and Medicare/Medicaid plus a new tool for reporting on your state.”
July 31, 1-2 pm eastern: “Tracking medical debt, a major cause of personal bankruptcy.”
US Healthcare Spending in 2022: $4.5 Trillion
January 2, 2024
According to the federal Centers for Medicare and Medicaid Service (accessed January 2, 2024):
“US health care spending grew 4.1 percent to reach $4.5 trillion in 2022, faster than the increase of 3.2 percent in 2021 but much slower than the rate of 10.6 percent in 2020. The growth in 2022 reflected strong growth in Medicaid and private health insurance spending that was somewhat offset by continued declines in supplemental funding by the federal government associated with the COVID-19 pandemic.”
In a related article published in the journal Health Affairs (“National Health Expenditure Accounts Team. National Health Care Spending In 2022: Growth Similar To Prepandemic Rates“):
“Personal health care prices, which reflect the prices associated with the goods and services consumed, increased by 2.3 percent in 2022 compared with 2.1 percent in 2021 (data not shown). Price growth for providers that receive a large share of their payments from health insurance increased at a relatively low rate. In 2022, price growth for hospitals, physician and clinical services, and retail prescription drugs continued to be low, with rates of 2.8 percent,4 0.5 percent,5 and 1.2 percent,6 respectively, and it was also relatively low for home health care agencies (2.5 percent)7 and nursing care facilities and continuing care retirement communities (3.0 percent).8 Conversely, other services that receive a smaller share of payments from health insurance, including dental services, other nondurable medical products, and durable medical equipment, can react more quickly to changing market conditions such as increased underlying price inflation, and these services experienced higher price growth in 2022 compared with 2021.3
“For non–personal health care, which includes government administration, the net cost of insurance, government public health activities, noncommercial research, and structures and equipment, prices increased 7.5 percent in 2022 after a decline of 1.1 percent in 2021 (data not shown). Prices for government administration, government public health activities, noncommercial research, and structures and equipment reflected strong growth in input prices such as wages and supplies in 2022, and increases in net gains or profits for insurers contributed to faster price growth in the net cost of insurance (data not shown).
“Nominal health spending of $4.5 trillion in 2022, which reflects an increase of 4.1 percent over 2021 levels, consisted of personal health care (an 83 percent share in 2022), government administration and the net cost of insurance (a 7 percent share), investment (a 5 percent share), and government public health activities (a 5 percent share). Spending for personal health care increased 4.0 percent in 2022 after faster growth of 5.5 percent in 2021 (exhibit 2). The slower growth in personal health care spending in 2022 was due to slower growth in hospital care (from 4.5 percent in 2021 to 2.2 percent in 2022), dental services (from 18.2 percent in 2021 to 0.3 percent in 2022), and physician and clinical services (from 5.3 percent in 2021 to 2.7 percent in 2022). Growth in non–personal health care spending, which increased 4.4 percent in 2022 after declining 6.8 percent in 2021, more than offset the slowdown in personal health care spending growth (data not shown).”
Baker Institute: More Texans Insured Thanks To The Affordable Care Act
November 23, 2023
Rice University’s Baker Institute for Public Policy reports that more Texans have health insurance coverage now thanks to the Affordable Care Act. According to the Institute’s November 14 issue brief, entitled Looking at the Numbers: 10 Years of Data on the Affordable Care Act Reveal Benefits for Texans:
“When the ACA was enacted in 2010, Texas had the highest uninsured rate (23.7%) in the country — 5.6 million people. The Texas Health and Human Services Commission estimated that full implementation of the ACA could cut the uninsured rate in half, with 36% or 2 million people gaining subsidized coverage through the ACA marketplace and 24% or 1.3 million people gaining coverage through Medicaid expansion.
“However, Texas did not embrace the ACA as a pathway to provide coverage for its citizens. In fact, the state fought the law at every turn in the early years, filing numerous lawsuits challenging its legality, refusing to support access to ACA marketplace plans through available channels, and declining to expand Medicaid.
“Notwithstanding these obstacles, the ACA has benefited Texans, particularly the marketplace, which has enabled over 2 million people to obtain affordable coverage not otherwise available in the state. Our review of 10 years of data shows how the ACA marketplace helped reduce the rate of uninsured Texans by one-quarter, from 23.7% in 2010 to 18% in 2021.”
Among its recommendations, the Institute suggests that Texans could benefit greatly from the creation of a state-based health insurance marketplace exchange:
“The noticeable increase in ACA enrollment in Texas has prompted state lawmakers to consider the creation of a state-based marketplace exchange in Texas. This reflects a marked shift among lawmakers in recognizing the ACA as a credible and effective policy tool to address health coverage needs for lower-income Texans. While the merits of this proposal have yet to be fully debated, this marks a change in attitude by lawmakers about the ability of the ACA to solve Texas’ persistently high uninsured rates. Texas continues to experience the highest uninsured rate in the country, and the coverage problem is compounded by the recent removal of 1 million enrollees from Medicaid as the pandemic winds down. The ACA has a lot to offer Texans, and we urge the Legislature to find ways to maximize its impact.”
Update: Medicare Drug Price Negotiations Moving Forward
October 19, 2023
Negotiations between the federal government and manufacturers of ten prescription drugs over prices are moving forward. The American Hospital Association reported on Oct. 3, 2023 (“CMS: Makers of selected drugs agree to participate in Medicare price negotiation”):
“The companies that make the first 10 Medicare Part D drugs selected to participate in the Medicare Drug Price Negotiation Program have agreed to participate in the program’s price negotiations, the Centers for Medicare & Medicaid Services announced. CMS in August selected 10 high-cost drugs for the first negotiation cycle, which will run until next August for prices effective in 2026. It plans to host public meetings on each of the drugs between Oct. 30 and Nov. 15, and make initial price offers for the drugs by Feb. 1.”
This follows a ruling in Federal court on Sept. 29 that allows negotiations to continue in spite of lawsuits by pharmaceutical manufacturers challenging the price program. As Reuters reported Sept. 29, 2023:
“Newman in a preliminary order rejected that argument, finding that drugmakers were unlikely to prevail in the case. He said they were not being forced to give anything up because participating in Medicare is ‘completely voluntary.’
“‘As there is no constitutional right (or requirement) to engage in business with the government, the consequences of that participation cannot be considered a constitutional violation,’ he wrote.
“The Chamber of Commerce and the U.S. Justice Department did not immediately respond to requests for comment.
“The Biden administration “will continue fighting to lower health care costs for American families, no matter how many challenges Republicans and Big Pharma put in our way,” White House spokesperson Karine Jean-Pierre said in a statement.
“Although Newman’s ruling allows the price negotiation program to begin as scheduled on Oct. 1, the judge allowed the lawsuit to continue, denying a motion by the government to dismiss it altogether.”
KFF has an issue brief on the potential impact of the prescription price negotiation program, “How Medicare’s New Drug Price Negotiation Program Could Expand Access to Selected Drugs.”
Medicare and Medicare Advantage
October 15, 2023
Medicare is a complicated system that mixes public and private insurance providers. As reported by the Scripps News Service on Oct. 21, 2022 (“Why Is Medicare So Complicated?”):
“By the government’s last count in 2021, 64 million adults were enrolled in Medicare. But that doesn’t mean it’s simple to navigate. The Medicare maze is growing more entangled over the years, as Congress adds new benefits, exceptions, and penalties.”
As KFF explains in its Sept. 18, 2023 issue brief, What to Know about the Medicare Open Enrollment Period and Medicare Coverage Options:
“People with Medicare may choose to receive their Medicare benefits through traditional Medicare or through a Medicare Advantage plan, such as an HMO or PPO, administered by a private health insurer. People who choose traditional Medicare may sign up for a separate Medicare Part D prescription drug plan for coverage of outpatient prescription drugs and may also consider purchasing a supplemental insurance policy to help with out-of-pockets costs if they do not have additional coverage from a former employer, union, or Medicaid. People who opt for Medicare Advantage can choose among dozens of Medicare Advantage plans, which include all services covered under Medicare Parts A and B, and often include Part D prescription drug coverage as well.”
Further regarding Medicare and Medicare Advantage plans:
“Traditional Medicare and Medicare Advantage both provide coverage of all services included in Medicare Part A and Part B, but certain features, such as out-of-pocket costs, provider networks, and access to extra benefits vary between these two types of Medicare coverage. When deciding between traditional Medicare and Medicare Advantage, people may want to consider a variety of factors, such as their own health and prescription drug needs, financial circumstances, preferences for how they get their medical care, and which providers they see. These decisions may involve careful consideration of premiums, deductibles, cost sharing and out-of-pocket spending; extra benefits offered by Medicare Advantage plans; how the choice of covedicare advantage marketingrage option may affect access to certain physicians, specialists, hospitals and pharmacies; rules related to prior authorization and referral requirements; and variations in coverage and costs for prescription drugs.
“People may prefer traditional Medicare if they want the broadest possible access to doctors, hospitals and other health care providers. Traditional Medicare beneficiaries may see any provider that accepts Medicare and is accepting new patients. People with traditional Medicare are not required to obtain a referral for specialists or mental health providers. Additionally, prior authorization is rarely required in traditional Medicare and only applies to a limited set of services. With traditional Medicare, people have the ability to choose among stand-alone prescription drug plans offered in their area, which tend to vary widely in terms of which drugs are covered and at what cost.
“People may prefer Medicare Advantage if they want extra benefits, such as coverage of some dental and vision services, and reduced cost sharing offered by these plans, often for no additional premium (other than the Part B premium). Additionally, Medicare Advantage plans are required to include a cap on out-of-pocket spending, providing some protection from catastrophic medical expenses. Medicare Advantage plans also offer the benefit of one-stop shopping (i.e., people who enroll have coverage under one plan and do not need to sign up for a separate Part D prescription drug plan or a Medigap policy to supplement traditional Medicare).”
Concerns over sales and marketing tactics used by some Medicare Advantage plan providers led the Centers for Medicare and Medicaid Services to issue new rules which went into effect in 2023. In its report Sept. 15, 2023 report entitled How Health Insurers and Brokers Are Marketing Medicare, KFF noted:
“In May 2022, the National Association of Insurance Commissioners (NAIC) sent a letter to Congress urging action on this issue, citing concerns about misleading claims and aggressive sales tactics. The following November, the majority staff of the Senate Finance Committee released a report detailing complaints and associated marketing materials from key stakeholders across 14 states. In response, CMS released new regulations, effective June 2022 and June 2023, tightening restrictions on health insurers and third parties who market Medicare Advantage and Part D plans.”
CMS Medicare Marketing Guidelines
Information about Medicare plans, including plan comparisons, is available from the federal Centers for Medicare and Medicaid Services at 1-800-MEDICARE or by going to Medicare.gov.
Medicare Open Enrollment Season Runs October 15 – December 7
October 15, 2023
Open enrollment season for Medicare is October 15 through December 7. According to the federal Centers for Medicare and Medicaid Services (last accessed Oct. 15, 2023):
“Medicare health and drug plans can make changes each year—things like cost, coverage, and what providers and pharmacies are in their networks. October 15 to December 7 is when all people with Medicare can change their Medicare health plans and prescription drug coverage for the following year to better meet their needs.”
As KFF explains in its brief on Medicare open enrollment and plan options including Medicare Advantage plans, What to Know about the Medicare Open Enrollment Period and Medicare Coverage Options:
“People in traditional Medicare can use the Medicare open enrollment period to enroll in a Medicare Part D prescription drug plan or switch between Part D plans. Traditional Medicare beneficiaries who did not sign up for a Part D plan during their initial enrollment period can enroll in a Part D plan during the annual open enrollment period, though they may be subject to a late enrollment penalty if they did not have comparable prescription drug coverage from another plan before signing up for Part D. Traditional Medicare beneficiaries with Medicare Parts A and B can also use this time to switch from traditional Medicare into a Medicare Advantage plan, with or without Part D coverage.
“People who are enrolled in a Medicare Advantage plan can use the Medicare open enrollment period to choose a different Medicare Advantage plan or switch to traditional Medicare. Medicare Advantage enrollees who switch to traditional Medicare can enroll in a Part D plan if they want outpatient prescription drug coverage, which is not covered under Medicare Parts A and B. They may also consider purchasing a Medicare supplemental insurance policy (Medigap) if the option is available to them (see question 4 for details about Medigap and potential limits on enrollment).”
Information about Medicare plans, including plan comparisons, is available from CMS at 1-800-MEDICARE or by going to Medicare.gov.
List of Drugs For Which Medicare Will Negotiate Prices Announced
September 1, 2023
On August 30, 2023, Kaiser Health News reported (“5 Things to Know About the New Drug Pricing Negotiations”):
“The Biden administration has picked the first 10 high-priced prescription drugs subject to federal price negotiations, taking a swipe at the powerful pharmaceutical industry. It marks a major turning point in a long-fought battle to control ever-rising drug prices for seniors and, eventually, other Americans.
“Under the 2022 Inflation Reduction Act, Congress gave the federal government the power to negotiate prices for certain high-cost drugs under Medicare. The list of drugs selected by the Centers for Medicare & Medicaid Services will grow over time.
“The first eligible drugs treat diabetes, blood clots, blood cancers, arthritis, and heart disease — and accounted for about $50 billion in spending from June 2022 to May 2023.”
These price negotiations are a significant policy change. As KHN noted:
“Medicare has long been in control of the prices for its services, setting physician payments and hospital payments for about 65 million Medicare beneficiaries. But it was previously prohibited from involvement in pricing prescription drugs, which it started covering in 2006.
“Until now the drug industry has successfully fought off price negotiations with Washington, although in most of the rest of the world governments set prices for medicines. While the first 10 drugs selected for negotiations are used by a minority of patients — 9 million — CMS plans by 2029 to have negotiated prices for 50 drugs on the market.”
In a piece published August 30, 2023 at The Conversation (“Medicare starts a long road to cutting prices for drugs, starting with 10 costing it $50.5 billion annually – a health policy analyst explains why negotiations are promising but will take years”), Professor Simon Haeder observed:
“If the negotiations proceed as planned, the drug-price-negotiation provision is expected to save the U.S. government about $98.5 billion by 2031 by allowing it to pay less on prescription drugs for Americans on Medicare – nearly 66 million people. The Biden administration hopes that these cost savings will be passed down to Americans 65 and older through reduced Medicare Part D premiums and lower out-of-pocket costs.
“The Inflation Reduction Act provides additional benefits for older Americans, including limiting their out-of-pocket expenses for prescription drugs to no more than $2,000 annually, limiting the growth of Medicare Part D premiums, eliminating out-of-pocket costs for vaccines and providing premium subsidies to low-income people ages 65 and older.
“The Inflation Reduction Act also includes a separate provision that requires drugmakers, under certain conditions, to provide the Medicare program with rebates if drug price increases outpace inflation, starting in January of 2023. That measure is expected to yield $71 billion in savings over a decade.”
Doctor Mariana Socal, an associate scientist at the Johns Hopkins Bloomberg School of Public Health, appeared on C-SPAN’s Washington Journal on August 31 to discuss the Medicare drug price negotiations.
Learning From Others
June 14, 2023
Professor Aaron E. Carroll, MD, MS, is the Chief Health Officer of Indiana University. In a guest essay comparing the US health care system with the systems of five other nations that was published June 13, 2023 in the New York Times (“I Studied Five Countries’ Health Care Systems. We Need to Get More Creative With Ours.”), he writes:
“America could learn a thing or two from these other countries. We could take inspiration from them and potentially improve access, quality and cost.”
Though the Canadian system may be more familiar with people in the US due to simple geography, Dr. Carroll argues that systems in other nations may provide better examples for potential cost savings and system efficiencies, pointing specifically to Britain, France, New Zealand, Australia, and Singapore.
He contends that the type of insurance is unimportant: “Insurance is really just about moving money around. It’s the least important part of the health care system.” What really matters is the bottom line: “Universal coverage matters. What doesn’t is how you provide that coverage, whether it’s a fully socialized National Health Service, modified single-payer schemes, regulated nonprofit insurance or private health savings accounts.”
Dr. Carroll points out that one of the main differences between the US and these other nations with better health outcomes is that they invest more to address other social determinants of health including housing, education, and nutrition:
“Our narrow view too often defines health care as what you get when you’re sick, not what you might need to remain well.
“When other countries choose to spend less on their health care systems (and it is a choice), they take the money they save and invest it in programs that benefit their citizens by improving social determinants of health.”
As Dr. Carroll concludes, “We’ve already decided to spend the money; we just need to spend it better.”
Buy-Outs, Practice Consolidation, and Access to Quality Care
May 14, 2023
The New York Times reports on a growing trend among healthcare organizations in the US, the impact of which may be of concern for patients and taxpayers. The Times reported on May 8, 2023 (“Corporate Giants Buy Up Primary Care Practices at Rapid Pace”) that:
“CVS Health, with its sprawling pharmacy business and ownership of the major insurer Aetna, paid roughly $11 billion to buy Oak Street Health, a fast-growing chain of primary care centers that employs doctors in 21 states. And Amazon’s bold purchase of One Medical, another large doctors’ group, for nearly $4 billion, is another such move.
“The appeal is simple: Despite their lowly status, primary care doctors oversee vast numbers of patients, who bring business and profits to a hospital system, a health insurer or a pharmacy outfit eyeing expansion.
“And there’s an added lure: The growing privatization of Medicare, the federal health insurance program for older Americans, means that more than half its 60 million beneficiaries have signed up for policies with private insurers under the Medicare Advantage program. The federal government is now paying those insurers $400 billion a year.”
This consolidation isn’t a new phenomenon. Again from the Times:
“The absorption of doctor practices is part of a vast, accelerating consolidation of medical care, leaving patients in the hands of a shrinking number of giant companies or hospital groups. Many already were the patients’ insurers and controlled the distribution of medicines through ownership of drugstore chains or pharmacy benefit managers. But now, nearly seven in 10 of all doctors are either employed by a hospital or a corporation, according to a recent analysis from the Physicians Advocacy Institute.”
This could be of great concern for patients. As the Times noted:
“This consolidation of medical care may also run afoul of state laws that prohibit what is called corporate medicine. Such statutes prevent a company that employs doctors from interfering with patient treatment.
“And experts warn of the potential harm to patients, when corporate management seeks to control costs through byzantine systems requiring prior authorization to receive care.”
The COVID-19 pandemic accelerated this trend. KFF, the healthcare foundation formerly known as the Kaiser Family Foundation, noted in September 2020 (“What We Know About Provider “Consolidation”) that:
“Depending on the severity and duration of revenue loss, some hospitals and physician practices may find it difficult to operate independently, which could increase the rate of consolidation among health care providers. Lower margins among some providers may create new opportunities for large chains to acquire smaller providers. The Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Health Care Enhancement Act allocated $175 billion for grants to providers that were partly intended to help make up for revenue lost due to coronavirus, but analysis shows that the first $50 billion in grants were not targeted to providers most vulnerable to revenue losses.2 Another $13 billion was subsequently targeted to safety net hospitals and $11 billion has been targeted to rural providers.3 However, it is not clear whether this infusion of funds plus other government loans—including those from the Paycheck Protection Program—will be sufficient to stabilize providers who are least equipped to weather this revenue decline. Even if sufficient government assistance is provided, the disruption of the COVID-19 pandemic may make operating independently seem less attractive and riskier to some smaller providers. Therefore, financial assistance to providers may not be sufficient to prevent an increase in the pace of consolidation.”
There are concerns that these private equity buyouts will have a negative impact on competition, health, and quality of care. The American Antitrust Institute and experts from the UC Berkeley School of Public Health released a report on this in 2021 entitled “Soaring Private Equity Investment in the Healthcare Sector: Consolidation Accelerated, Competition Undermined, and Patients at Risk.” Among their findings, they noted that:
“Private equity funds, by design, are focused on short-term revenue generation and consolidation and not on the care and long-term wellbeing of patients. This in turn leads to pressure to prioritize revenue over quality of care, to overburden health care companies with debt, strip their assets, and put them at risk of long-term failure, and to engage in anticompetitive and unethical billing practices. Adding to the mounting evidence of the negative impact of private equity on healthcare, two recent National Bureau of Economic Research studies of the nursing home and dialysis markets found that private equity ownership is correlated with worse health outcomes and higher prices.”
Medicaid Re-Enrollment Begins Again
March 31, 2023
US states are restarting yearly Medicaid and Children’s Health Insurance Program (CHIP) eligibility reviews. The Kaiser Family Foundation reported on February 22, 2023 (“10 Things to Know About the Unwinding of the Medicaid Continuous Enrollment Provision”):
“Primarily due to the continuous enrollment provision, Medicaid enrollment has grown substantially compared to before the pandemic and the uninsured rate has dropped. But, when the continuous enrollment provision ends, millions of people could lose coverage that could reverse recent gains in coverage. As part of the Consolidated Appropriations Act, 2023, signed into law on December 29, 2022, Congress set an end of March 31, 2023 for the continuous enrollment provision, and phases down the enhanced federal Medicaid matching funds through December 2023. States that accept the enhanced federal funding can resume disenrollments beginning in April but must meet certain reporting and other requirements during the unwinding process.”
According to the federal Centers for Medicare and Medicaid Services (last accessed March 31, 2023:
“This means your state will use the information they have to decide if you or your family member(s) still qualify for Medicaid or CHIP coverage. If your state needs more information from you to make a coverage decision, they’ll send you a renewal letter in the mail. Most children can still be covered through the Children’s Health Insurance Program. For details, check your Medicaid notice or contact your state Medicaid office at the links below.
“Get ready to renew now
“Here are some things you can do to prepare for the renewal process:
- “Update your contact information – Make sure your state has your current mailing address, phone number, email, or other contact information. This way, they’ll be able to contact you about your Medicaid or CHIP coverage.
- “Check your mail – Your state will mail you a letter about your coverage. This letter will let you know if you need to complete a renewal form to see if you still qualify for Medicaid or CHIP.
- “Complete your renewal form (if you get one) – Fill out the form and return it to your state right away to help avoid a gap in your coverage.”
New at JAMA: Viewpoint: The Existential Threat of Greed in US Health Care
February 7, 2023
The journal JAMA published a Viewpoint on Jan. 30, 2023 by Donald Berwick, MD, MPP, entitled Salve Lucrum: The Existential Threat of Greed in US Health Care.
In it, Dr. Berwick contends:
“Profit may have its place in motivating innovation and higher quality in health care, as in any industry. But kleptocapitalist behaviors that raise prices, salaries, market power, and government payment to extreme levels hurt patients and families, vulnerable institutions, governmental programs, small and large businesses, and workforce morale. Those behaviors, mostly legal but nonetheless wrong, have now accumulated to a level that poses an existential threat to a sustainable, equitable, and compassionate health care system.”
The problem Dr. Berwick identifies has a human cost:
“A total of 41% of US adults, 100 million people, bear medical debts. One of every 8 individuals owes more than $10 000. In Massachusetts, 46% of adults say they skip needed care because of costs. As of 2021, 58% of all debt collections in the US are for medical bills.10 Health insurance premiums in Massachusetts have gone up more than 200% in 2 decades and now cost more annually per family than a car. People of lower income must choose high-deductible plans; they cannot afford more complete coverage. In no other developed nation on earth is deep medical debt as present a threat as in the US.”
Dr. Berwick suggests some solutions that require leadership from healthcare professionals, some of whom are participants in the paean to excess profit that he identifies, including:
– “First, health care professionals in all disciplines need to become noisier about the conflict between unchecked greed and the duty to heal.”
– “Second, health care professionals should insist that their guilds and trade organizations demote the pursuit of higher payment among their priorities.”
– “Third, health care leaders and professionals should lobby Congress to pass legislation to rein in greed.”
– “Fourth, health care professionals should insist that their organizations invest actively in improving the true social influences on health.”
Oregon Becomes First US State To Guarantee Its Residents Access To Affordable Healthcare
January 20, 2023
In the November 2022 general election, Oregon voters narrowly approved Oregon Measure 111, the Right to Healthcare Amendment. The measure amended the state constitution, adding a guarantee of access to affordable healthcare for all Oregon residents. According to Ballotpedia, last accessed Jan. 20, 2023:
“Ballot title
“The ballot title was as follows:[7]
“Amends Constitution: State must ensure affordable healthcare access, balanced against requirement to fund schools, other essential services
“Result of ‘Yes’ Vote: ‘Yes’ vote requires state to ensure affordable healthcare access. State must balance healthcare funding against funding for schools, other essential services; courts must respect balance.
“Result of ‘No’ Vote: ‘No’ vote retains current law. The constitution does not require the state to ensure access to affordable health care; state provides some healthcare access.[8]
“Ballot summary
“The ballot summary was as follows:[7]
“Amends Constitution. Current state law outlines the general requirements for health insurance policies and provides health care for low income and disabled residents who meet eligibility requirements. Amends the Oregon Constitution to establish health care as a fundamental right; obligates the state to provide Oregon residents ‘access to cost-effective, clinically appropriate and affordable health care.’ Amendment requires the state to balance that obligation against the public interest in funding public schools and other essential public services. If the state is sued to enforce the amendment, the court may not order a remedy that interferes with the state’s requirement to balance healthcare funding against funding for public schools and other essential public services.[8] ”
As Oregon Public Broadcasting reported on Nov. 15, 2022, last accessed Jan. 20, 2023:
“Measure 111 makes Oregon the first state in the nation with a constitutional obligation to provide access to affordable health care to all its residents, similar to the constitutional guarantee of a public K-12 education.
“The measure is a win for Democrats in the Legislature, who referred it to the voters over opposition from their Republican colleagues.
“The language of the measure states: “It is the obligation of the state to ensure that every resident of Oregon has access to cost-effective, clinically appropriate and affordable health care as a fundamental right.”
“But Measure 111 does not spell out what the state must do to meet its new constitutional obligation, or define what access to affordable health care means. It will be up to the Legislature to shape what health care access for all looks like and how to pay for it. The Legislature will be back in session starting in January.”
Massive Savings Possible In US Health System
October 21, 2021
The management consulting firm McKinsey & Company has issued a new report estimating that administrative changes and efficiencies could save the US health system more than a quarter trillion dollars.
As noted in a Viewpoint article published in JAMA on October 20:
“The analysis dissected profit and loss statements of individual health care organizations, estimated spending on specific processes, and compared administrative spending in health care with that of other industries. The conclusion of the report is that an estimated $265 billion, or approximately 28% of annual administrative spending, could be saved without compromising quality or access by implementing about 30 interventions that could be carried out in the next 3 years.2 This set of interventions works within the structure of today’s US health care system in order to preserve its market nature (eg, multipayer, multiclinician, multi–health care center) and the associated benefits (eg, world-leading innovation in care delivery).”
According to the article:
“The starting point is 5 functional areas that account for approximately 94% of administrative spending (see eTable in the Supplement). The largest of these is industry-agnostic corporate functions: general administration, human resources, nonclinical information technology, general sales and marketing, and finance. This functional area accounts for an estimated $375 billion of spending annually. The second-largest category is the financial transactions ecosystem, which includes claims processing, revenue cycle management, and prior authorization, accounting for an estimated $200 billion annually. The rest is made up of industry-specific operational functions, such as insurance underwriting (an estimated $135 billion annually), administrative clinical support operations such as case management (an estimated $105 billion annually), and customer and patient services such as call centers (an estimated $80 billion annually).
“For each of these functional focus areas, known interventions that could reduce spending without harming patient care were considered. This meant using a financial and operational perspective for the analysis, but also acknowledging that these interventions could and likely will have broader benefits on other outcomes, such as access, quality, patient experience, physician satisfaction, and equity.”
The report from McKinsey & Co., entitled “Administrative simplification: How to save a quarter-trillion dollars in US healthcare,” is available from the McKinsey website. The publication is a free download however registration is required.
Health Care in the US Compared to Other High-Income Countries
August 6, 2021
On August 4, the Commonwealth Fund issued a new report entitled Mirror, Mirror 2021: Reflecting Poorly / Health Care in the US Compared to Other High-Income Countries.
The report compares health care systems in eleven nations: the United States, Canada, Switzerland, France, Sweden, New Zealand, Germany, the United Kingdom, Australia, the Netherlands, and Norway.
The report’s key findings: “The top-performing countries overall are Norway, the Netherlands, and Australia. The United States ranks last overall, despite spending far more of its gross domestic product on health care. The U.S. ranks last on access to care, administrative efficiency, equity, and health care outcomes, but second on measures of care process.”
The authors conclude: “Four features distinguish top performing countries from the United States: 1) they provide for universal coverage and remove cost barriers; 2) they invest in primary care systems to ensure that high-value services are equitably available in all communities to all people; 3) they reduce administrative burdens that divert time, efforts, and spending from health improvement efforts; and 4) they invest in social services, especially for children and working-age adults.”
Medical Debt in Collections in the US
August 6, 2021
On July 20, JAMA published an article on medical debt in collections in the US entitled “Medical Debt in the US, 2009-2020.”
The researchers found: “In this retrospective analysis of credit reports for a nationally representative 10% panel of individuals, an estimated 17.8% of individuals in the US had medical debt in collections in June 2020 (reflecting care provided prior to the COVID-19 pandemic). Medical debt was highest among individuals who lived in the South and in zip codes in the lowest income deciles and became more concentrated in lower-income communities in states that did not expand Medicaid.”
Additionally, “The analysis shows that Medicaid expansion was associated with reductions in medical debt in collections.”
The researchers also observed that “During the last decade, medical debt has become the largest source of debt in collections. The reductions in nonmedical debt in collections between 2009 and 2020 occurred simultaneously with the economic recovery from the Great Recession, consistent with the well-documented association between unemployment and loan delinquency.14 In contrast, total medical debt in collections decreased by a more modest amount. As a result, as of June 2020 individuals had $39 more in mean medical debt in collections than they had in mean debt in collections from all other sources combined ($429 vs $390), including credit cards, utilities, and phone bills.”
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