Hospital groups say public option would cut payments by 10%
- The American Hospital Association and Federation of American Hospitals are stepping up opposition to a public option, which would allow citizens to opt in to a government-run health plan. They argue such a plan would cost hospitals $800 billion and throw a kink in the employer-sponsored insurance market.
- A public option, an industry report claims, would create only a "modest drop" in the uninsured rate compared to the gains that could be made by expanding the current coverage system, which FAH President Chip Kahn argued "Americans are satisfied with." A January Kaiser Family Foundation poll found 74% of Americans want something like a public option, while 56% support the idea of Medicare for all.
- Hospital groups helped eliminate a public option provision from the original Affordable Care Act, and began ramping up lobbying efforts against the Medicare for all idea toward the end of last year.
The $774 billion reduction in payments AHA and FAH claim hospitals will face under what they call a "Medicare-X Choice" proposal cover the period between 2024 and 2033 and total a 10% reduction in hospital payments.
Such a proposal would also "stifle" hospitals' ability to keep up with medical advances, invest in new delivery models and juggle rising drug costs, the hospitals said. "This buy-in to a Medicare-like public option may fit on a bumper sticker, but it is no solution for health care coverage," Kahn said in a statement.
Out of the eight legislative proposals to expand insurance coverage introduced by members of the 115th Congress in 2017, seven included a public option. The eighth, a Medicare for all bill, would install a single-payer system. Medicare for all, AHA president Tom Nickels said, would "impede" the industry's goals.
"It is not practical to disrupt coverage provided through employer-sponsored plans that already cover more than 150 million Americans," Nickels said of the public option.
Kelly Coogam-Gehr of National Nurses United, which has been a very vocal proponent of Medicare for all, shares the hospital groups' disdain of a public option. Public option plans can be costly for families, increase premiums, won't alleviate national health expenditures and don't solve the core problem of administrative complexity, she said.
Government would be forced to compete with private insurance prices. That's not ideal at the moment, Coogam-Gehr added. "It allows private insurance to cherry-pick the healthiest patients, while the sickest patients go into public option," she said. "It will make it look like Medicare is a lot more expensive than it actually is."
While hospitals and systems oppose the idea, big doctor groups are in favor, including the American Medical Association, the American College of Physicians and the American Academy of Family Physicians.
By offering choice of keeping private insurance or a public plan, it will be less threatening to those in the insurance and related fields and to employers and employees who want to keep private insurance.— Bob Doherty (@BobDohertyACP) January 29, 2019
ACP did not want to comment on the AHA/FAH report.
The report itself was prepared by KNG Health, a consulting group founded by former CMS economist Lane Koenig. Koenig was previously a scientist for UnitedHealth subsidiary Lewin Group, a consulting firm known for its oft-cited 2009 study on the ACA. That study also claimed that a public option would cause employer-sponsored coverage rates to plummet by more than 100 million people.
Many also warned the ACA without the public option could erode employer based insurance, though that hasn't come to pass.
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