health reform

The Rising Cost of Health Care – a 360 Degree Perspective

By M2|2018-09-21T20:19:20+00:00September 21st, 2018|Health care spending, Health Reform, Insurance, Out-of-pocket spending, Uncategorized|

The Rising Cost of Health Care – a 360 Degree Perspective

The Colorado Women’s Alliance surveyed 2,000 swing women voters in Colorado earlier this year and asked them to identify their top issues of concern, as well as what they hoped the new Governor (who will be elected in November) and Colorado legislature will focus on in the coming session.

The rising cost of health care was the number one issue.

In response, Joni Inman, the Executive Director of the Alliance, in partnership with the Summit Chamber, organized a series of events, including a panel discussion in Frisco, Colorado last week titled “The Rising Cost of Healthcare – a 360 Degree Perspective.” I was honored to serve as a panelist alongside Colorado House Representatives Millie Hamner (D) and Bob Rankin (R), and professionals from the local hospital, a statewide health insurer and the Summit County Care Clinic.

While I am often asked to share policy ideas, for this panel, we were asked to share thoughts on what the consumer can already do that they might not realize is a good strategy available to them to lower their health care costs.

This is of particular relevance in Summit County as it is one of the healthiest places in the U.S., but also has some of the highest health insurance premiums in the country. Not surprisingly, Summit County health care consumers, as the audience quickly proved once the panel discussion started, are highly informed and interested in being proactive about their health care and the health care of their families.

My primary message was simple. When it comes to health care, we need to be much more demanding.

Be a demanding constituent

Sharing the stage with elected officials, I acknowledged the state legislature and Governor’s administration has some ability to make changes to how health care, and health insurance is financed and delivered. With that in mind, yes, it is important to advocate for policy changes. Vote. Call your representative. Send letters. Participate in hearings. Get involved in local politics. Make your opinion and preferences known.

This seems simple, but Reps. Hamner and Rankin were clear that they wanted to hear more from constituents, and individuals in particular, not just from lobbyists. Still, this can be hard to do. We all have busy lives and sometimes it is hard even to know what is happening regarding legislation or proposed policy ideas.

Be a demanding consumer

In addition to being a demanding constituent, it is important to be a demanding consumer. What can consumers already do that are good strategies to lower costs? Know more and ask questions.

First, know as much as you can about what your health insurance costs. What is the premium amount? What is the deductible? What types of services are covered at what levels? What are your rights to appeal a denial? Lots of resources exist. A great place to start is this compilation of websites from the Institute for Healthcare Improvement.

Second, as a consumer and as a patient, it is important to ask questions. Especially about how much a health care service will cost you. Of course, if you have been transported by ambulance to the emergency department, you aren’t going to be able to demand pricing information, but in the many instances you can ask, you should.

For example, as of May of 2018, 26 states, including Colorado (see map) have passed laws banning a practice that forbid pharmacies from informing consumers if and when the drug they were seeking to buy would be cheaper if they paid out-of-pocket instead of using their insurance. Yes, you read that right! Before these laws, many pharmacists were contractually forbidden by so-called “gag clauses,” from answering a direct question from a consumer at the pharmacy counter about the purchase price of a drug.

Ask this question: What is the price of this medicine, or this procedure, or this lab test, if I don’t use my insurance?

This strategy works outside of the pharmacy too. A consumer in the audience at the Summit County event gave an example of going to a local hospital with her husband over the fourth of July after he broke his elbow. When they asked the hospital about the price for the scan a provider recommended, they were told they could receive a 50% discount if they paid cash or used their credit card instead of using their insurance.

When I went to my dermatologist recently, I signed a document saying I wouldn’t submit a claim to my insurer if I agreed to use a specific pathology lab that would only charge $65 for lab tests. While my dermatology office wouldn’t tell me exactly how much I was saving (I was saving it since I was out-of-network and have a $7,600 deductible even in-network), they implied the insured rate for these pathology labs was hundreds of dollars more.

Demand more

Yes, call your legislator. Participate. Organize. Vote. But, we should all demand more of our employers, our health plans, and our health care providers, too. Ask for price lists. Ask for discounts. Ask what care options you have. Ask whether cheaper alternatives exist and how you can access them. Tell your employer you want choices.

We are all health care consumers, even if we aren’t all patients. Make your voice heard and your preferences known. Consumers can change the way the system works, but we have to demand that change.

It’s all about the premiums, for a tiny but mighty political powerhouse

By M2|2017-10-20T04:24:21+00:00October 19th, 2017|Health Plans, Health Reform, Insurance, Uncategorized|

It’s all about the premiums, for a tiny but mighty political powerhouse

On October 17, 2017, Senators Lamar Alexander (R-TN) and Patty Murray (D-WA) announced a bipartisan deal to “stabilize individual market premiums and provide meaningful state flexibility.” The latest “repeal and replace” proposal from Alexander/Murray came just a week after U.S. Health and Human Services (HHS) Acting Secretary Eric Hargan and Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma announced cost-sharing reduction (CSR) payments would be “discontinued immediately based on a legal opinion from the Attorney General.” Lots and lots has already been written about the CSR policy change (I recommend Timothy Jost’s piece in Health Affairs for a brief summary of the major issues).

Professor Jost explains the CSRs succinctly:

The Affordable Care Act (ACA) requires insurers to reduce cost sharing for individuals who enroll in silver plans and have household incomes not exceeding 250 percent of the federal poverty level (FPL). These provisions reduce the out-of-pocket limit for these enrollees—particularly for those with incomes below 200 percent of poverty—and sharply reduce deductibles, coinsurance, and copayments. The reductions cost insurers around $7 billion a year currently.

Based in part on what the Senators heard from state officials in early September (see this ) the Alexander/Murray deal would continue to fund the CSRs for two years, would allow people of any age to purchase catastrophic health plans and would allow states even broader latitude to waive provisions of the Affordable Care Act (ACA) in order to lower premiums – for example, by allowing health insurers to offer products that do not cover all of the essential health benefits.

If lower priced products can’t be offered in the portion of the market that is unsubsidized, it is difficult to foresee how a bill gets through Congress. A tiny but mighty political powerhouse is fighting hard for a fix that solves a very particular problem in the current ACA structure.

It’s all about the premiums

Keep in mind, about 17 million people receive their health insurance through the ACA health exchanges (see Charles Gaba chart – aka The Psychedelic Donut – below) – approximately 5% of the American public. Of those 17 million people, 1.6 million are in Exchange plans, but do not receive a subsidy. That is, health insurance companies are not obliged to reduce their premiums or cost-sharing requirements, most likely because they make more than 250 percent of FPL – about $30,000 for a single person, or $61,500 for a family of four.

Charles Gaba’s Psychedelic Donut Chart

Florida’s 6.6%

Let’s take the example of Florida. Just before the CSR announcement from the Trump Administration, one of the state’s largest insurers, Florida Blue, said it would be raising premiums, on average, 38 percent, for the 2018 plan year. A spokesperson explained:

“So who’s the one losing in this scenario? It’s the people who don’t get a subsidy to help out. Florida Blue has about 66,000 of their 1 million Obamacare customers who would have to cover the premium increases on their own. These are people with higher incomes, many who are maybe freelancers or self-employed.

But who are those 66,000 people? In my estimation, that mighty 6.6%, and their counterparts across the U.S., are the ones who have effectively driven this policy change, and much of the “repeal and replace” demands over the past few years. Small business owners, especially tiny ones with fewer than five employees, are very focused on the issue of rising premiums and have been instrumental in communicating to their elected officials that their premiums are too high. The National Small Business Association (NSBA) 2016 Politics of Small Business Survey last year asked nearly 1,000 small business owners (47% of the respondents had five or fewer employees) what they contacted elected officials about.

What was the top issue? Controlling the costs of health care (see chart).

And amazingly, “97 percent of small-business owners say they vote regularly in national contests, compared to” only 58 percent turnout for the general election in 2012.

The Florida Blue spokesperson explained why this is such a hot-button issue for these politically-motivated, non-CSR-receiving, small business owners:

“The good news in all this: most people in Florida get private health insurance through their work. Those increases are going to be much more normal – about 8 percent on average for small companies.”

There is the whole issue in a nutshell. If you run a business or are self-employed and you make more than about $30,000 a year, you pay high premiums that jump 20, 30, 40 percent or more a year. In Florida, the average premium increase on the Exchange will be 45 percent in 2018, and the highest approved rate increase was 71 percent according to the Florida Office of Insurance Regulation. But if you buy the same insurance a slightly different way, either by becoming self-insured or becoming an employee of a bigger company, your premium increase will not be as great.

As Washington and the states continue to debate “repealing and replacing” the Affordable Care Act, keep an eye on what policy proposals mean for the politically-active small business owner. Fixes such as allowing anyone to buy catastrophic health plans (not just those under the age of 30) or allowing health insurers to sell products that offer fewer benefits will likely lower the premiums for people who buy health insurance on their own, whether tiny businesses or freelancers. Stopping payment of the CSRs won’t fix the problem small business voters are having with health care. If a proposal fixes this tiny but mighty political group’s problem with the ACA, the likelihood of passage improves immensely.

Health Care Reform Has States and Feds in Tug-of-War

By M2|2017-10-11T23:46:10+00:00October 11th, 2017|Health Reform, Uncategorized|

Health Care Reform Has States and Feds in Tug-of-War

In the past nine months, the Republican-controlled Congress have failed a couple of times to make significant changes to the Affordable Care Act (ACA) through legislation. As state policy people, we watch closely what happens in states, and right now we are paying extra close attention, because the health care financing and delivery system needs changes regardless of what Congress can achieve.

Last month, the U.S. Senate Committee on Health, Education, Labor & Pensions (HELP), led by Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA), held full committee hearings on Stabilizing Premiums and Helping Individuals in the Individual Insurance Market for 2018 in September. The committee hosted five Insurance Commissioners on September 6, 2017, and five Governors on September 7, 2017. M2 watched the hearings for clues about what states are most interested in focusing on when it comes to health reform, and what kind of support they need from the feds in order to pursue changes.

Insurance Commissioners Testifying

Five Insurance Commissioners provided testimony to the Senate HELP Committee:

AK: Lori K. Wing-Heier, Director, Alaska Division of Insurance
OK: John Doak, Commissioner, Oklahoma Department of Insurance
PA: Teresa Miller, JD, Insurance Commissioner of Pennsylvania
TN: Julie Mix McPeak, Commissioner, Tennessee Department of Commerce & Insurance
WA: Mike Kreidler, Washington State Insurance Commissioner

Governors Testifying

Five Governors provided testimony to the Senate HELP Committee:

CO: John W. Hickenlooper, Governor, Colorado (D)
MA: Charlie Baker, Governor, Massachusetts (R)
MT: Steve Bullock, Governor, Montana (D)
TN: Bill Haslam, Governor, Tennessee (R)
UT: Gary Herbert, Governor, Utah (R)

Key Themes from Insurance Commissioners’ and Governors’ Comments

Each of the Governors and Insurance Commissioners provided short testimonies, then each panel fielded questions from various members of the committee. As with many of these public events, there is a fair amount of posturing that happens. Looking past the posturing, several key themes emerged from the panel members. The Insurance Commissioners and Governors said:

Congress should fund the cost-sharing reduction (CSR) payments in order to stabilize the individual health insurance markets in the states.
The federal government should fund some sort of reinsurance program, at least for a short period of time until states can take over the function.
The Centers for Medicare & Medicaid Services (CMS) should provide states with increased flexibility and responsiveness to 1115 Medicaid waiver and 1332 State Innovation waiver requests such as:
- Faster approval times (shorten timelines to complete in 90 days);
- Flexibility in budget neutrality provisions;
- Simplify the process;
- Expand the list of what can be waived;
- Let more consumers buy catastrophic plans.
Bringing down health insurance premiums will require addressing the underlying drivers of health care costs.
Six of ten testimonies mentioned the cost of prescription drugs.

Many of these ideas are not exactly new and have been requested by both states and associations before. For example, take a look at the responses from states in January 2017 to a request for comments on health insurance markets and Medicaid from House Majority Leader, Kevin McCarthy (R-CA), as well as ideas that have been put forth by the National Governors Association Shared Priorities from the Governors’ Bipartisan Health Reform Learning Network. 13 states participated in the Learning Network (California, Delaware, Kentucky, Minnesota, Montana, Pennsylvania, South Dakota, Tennessee, Utah, Vermont, Virginia, Washington, and Wyoming, a mix of Rs and Ds) and recommended “Stabilization of the Private Health Insurance Market,” including the federal government fully funding the cost-sharing reductions (CSRs) and providing at least short-term funding for reinsurance (sound familiar?). The Learning Network also asked for increased state authority and flexibility to act in health insurance markets, Medicaid, payment and delivery system reform, and public health priorities, including addressing the opioid epidemic.

Of particular note, many of these comments from state officials are starting to emphasize the need not just to address the cost of insurance, but to go deeper and find ways to address the cost of health care. Trying to get people to be more healthy, and trying to get providers to accept payment for health outcomes are also not new ideas, but so many state officials talking about them as part of a state’s responsibility to her residents is a bit unique.

What happens next is likely to happen in the states, even as the Feds seem to be sending mixed messages about approving waivers for flexibility – see Iowa, Minnesota and Oklahoma news from the past few weeks for examples. We know what states want. What will they get? Stay tuned!

My Experience with Obamacare

By M2|2017-10-08T11:23:43+00:00September 6th, 2017|Health Reform, Uncategorized|

My Experience with Obamacare

A few weeks ago I wrote about working with patient advocates…

While my patient advocate session was focused on Medicaid, my personal experience with Obamacare is in a different health care system, if you will, because I run a “micro-business” (fewer than 10 people) and I buy an individual policy “off-Exchange.”

My income is above 400% of the Federal Poverty Level (FPL) so I don’t receive any assistance to buy the insurance, i.e., pay the premium, nor do I receive any assistance with copays, etc. (the cutoff for cost-sharing help is 200% of FPL). Personally, I feel I make enough money to pay for insurance, and I do worry about getting into a car accident or receiving a life-changing diagnosis, so I choose to buy health insurance every year.

Even still, the patchwork system that has been built is truly not designed for someone like me. I am lucky enough to have few health problems. I fill a prescription less than once a year and when I do, it’s usually for some kind of travel-related thing, like malaria prevention. I am not writing this to brag, but simply to say, I don’t “need” health insurance other than the way I “need” homeowner’s insurance. I am insuring myself against something terrible happening. If I pay $12,000 a year in premiums, I expect I will receive no value from that expense each year except peace of mind. For some people, they do “need” health insurance because they have health care needs they could not afford to manage without that insurance.

Should the person with health care needs pay more for insurance than I pay? Well, they already do, because even if we pay the same amount in monthly premiums, they certainly pay more in deductibles, copays, and any other cost-sharing than I do because they use health care services that require those payments. The essence of insurance, whether car, home, fire, or health, is that more people pay premiums than incur claims. I am buying protection against a possible eventuality. For people with health care needs, health services aren’t an eventuality, they are a reality. That’s what insurance is for.

But the other important question is whether my purchase of insurance should be tax-advantaged in some way. I mentioned above that some people are eligible to receive tax-payer supported health insurance or health care – either because they qualify for Medicaid or because they have an income low enough to allow them to buy insurance in the Exchanges.

Should my purchase of health insurance be tax advantaged because of my job status? How about because I am an employer? That may seem an odd question, but as most of this blog’s readers know, the employer-sponsored insurance (ESI) tax exclusion is the single largest tax break in the nation. It is also worth more to people who earn more income. The Tax Policy Center estimates the “ESI exclusion costs the federal government an estimated $260 billion in income and payroll taxes in 2017.” (For comparison, the mortgage interest deduction was worth about $70 billion).

So despite my income and work status, I am eligible for tax-advantaged health insurance after all! But the patchwork nature of the U.S. health insurance system rears its ugly head again because it turns out, it’s cheaper for me to buy health insurance in the individual market (and to help my employees do the same), than it is for me to buy in the small group market. The choice is to access the tax deduction, but pay more for insurance for me and everyone in my company, or buy a plan in the individual market and pay less.

As ZaneBenefits explains, “for the majority of small groups, individual health insurance is more affordable than group health insurance because of the size of the risk pool…With a group health insurance plan if one employee has a baby, a surgery, or is diagnosed with a chronic illness, [the business is] likely to see a large premium rate increase at annual renewal time.”

Part of the debate about repealing and replacing Obamacare concerns patients with high health care needs who could lose access to care, as we have blogged about previously. However, part of the debate is also about the premium increases being seen by small businesses (and other entities as well). Members of the National Federation of Independent Business (NFIB), which represents small businesses, “have reported “The Cost of Healthcare” as the #1 problem for small businesses in Small Business Problems & Priorities since 1986.”

To be graphic, it has led to this:

The chart above from the Society for Health Resource Managers (SHRM) shows the stability of health insurance offering rates by large employers, compared to four smaller employer sizes. Notably, the smallest employer size (10 employees or fewer) represented by the black line at the bottom of the chart, has decreased by the largest percentage (36%).

My personal experience of Obamacare is a mixed bag. On the one hand, because of Obamacare it is much easier for me to buy insurance for myself as a small business owner than it was before the law passed. On the other hand, as an employer, the regulatory burden of and cost of trying to provide insurance coverage to my employees has proven to be too much for our small company to handle. Even with Obamacare, we, as a small business, are at a fundamental disadvantage when it comes to offering support for employees who want to buy health insurance.

Small businesses, defined by the Small Business Administration as those with fewer than 500 employees, comprise 99.7% of firms with paid employees, and employ 48% of private sector employees. Paying more attention to what needs to be fixed in Obamacare based on the needs of small businesses, in addition to focusing on the needs of those with serious health care needs, could lead us to more productive solutions than have been on offer recently.

There are multiple health insurance systems operating in the U.S. We either have to agree we are only going to try to tackle a couple of pieces, or we have to be more transparent about what happens if we make changes to the system that benefit someone like me (low health care needs, high premiums) or to benefit someone like the patient advocates (high health care needs, supported by tax dollars). I wouldn’t mind a little more attention being paid to small business concerns either!

The Future of Medicaid – Implications for Patients and Action for Advocates

By M2|2017-10-08T11:36:02+00:00July 13th, 2017|Health Reform, Medicaid, Uncategorized|

The Future of Medicaid – Implications for Patients and Action for Advocates

I had the privilege of talking with nearly 100 patient advocates recently about the Medicaid proposals under consideration in the House and Senate bills aiming to “repeal and replace” Obamacare. As part of a webinar series hosted by the Patient Advocacy Leaders Summit (PALS), a national initiative convened by The AIDS Institute, I presented ideas for ways patient advocates could continue to work on behalf of themselves and their members to communicate with elected officials and policymakers about the importance of Medicaid to their access to health care.

PALS introduced the webinar as follows:

“As Congress and the Administration continue to move toward efforts to repeal and replace The Affordable Care Act, Medicaid has emerged as one of THE major points of contention, with its future being widely debated. Revamping Medicaid would affect access to health care and services for millions, who represent some of the most vulnerable populations.

Both the House bill, The American Health Care Act (passed May 4), and the Senate Republican’s proposal, The Better Care Reconciliation Act of 2017 (released June 22), aim to reduce federal health care spending and cap Medicaid while shifting greater responsibility to the states. Both plans will cause millions of Americans to go without coverage and struggle with health care bills.

Our speakers will share their perspectives and insights regarding the future of Medicaid, implications for patients and what you as an advocate can do to make a difference as Medicaid, and our entire health care system, is being transformed.”

Alongside co-presenters, Candace DeMatteis, the Policy Director of Partnership to Fight Chronic Disease (PFCD) and Matt Salo, the Executive Director of the National Association of Medicaid Directors (NAMD), we underscored three central themes:

Real people, with serious health care needs, will lose access to care;
People who rely on Medicaid are people you know or encounter in your daily life; and
Familiarity with Medicaid, through real-life stories, helps everyone understand how the program provides health care to those who need it most.

Real people will lose access to health care

Of the people who will be directly affected by the proposed reforms, many have serious health care needs. As we have explained in previous blogs, health care costs in the U.S. are highly concentrated. In 2012, the top 1% of spenders accounted for 22.7% of all U.S. health care expenditures, the top 5% of spenders accounted for 50% of expenditures, and the bottom 50% of spenders accounted for less than 3% of expenditures.

Medicaid has similarly concentrated health care costs. For example, as DeMatteis explained, people eligible for both Medicare and Medicaid (the “duals”), are 13% of Medicaid enrollees, but account for about 35% of program costs.

People who rely on Medicaid are people you know

Most people either know someone on Medicaid or have a frequent encounter with someone who relies on the program. Families USA created infographics providing examples of the types of people we all interact with who might benefit from the Medicaid expansion. Below is a portion of their infographic for Florida which clearly shows retail sales clerks, fast food workers, hotel desk clerks, library assistants and taxi drivers as just a few of the types of working adults whose income is low enough for them to qualify for Medicaid.

Familiarity with Medicaid and real-life stories are key

Salo, even with all of his deep expertise in the details of Medicaid, reminded patient advocates, and all of us what matters when talking about Medicaid. “You need to put a face on it,” he explained. In order to be effective advocates for patients as enormous Medicaid changes are being considered, it is essential to make this about real people, with real health care stories (sometimes horror stories!).

DeMatteis reminded the group of the “power of the anecdote,” to counter myths and false narratives, especially around who benefits from Obamacare.

My tips for advocates were similarly focused. To change people’s minds and to write better policy, we need to always keep in mind that this is about real people, first and foremost, with real health care needs. We built this system because a patient needed actual health care services. Let’s make sure that in our efforts to get rid of what isn’t working in Obamacare, we don’t throw the patient out with the repeal bathwater.

In Health Reform, Whose Costs Are We Talking About Anyway?

By M2|2017-10-08T11:38:04+00:00July 7th, 2017|Health care spending, Health Reform, Uncategorized|

In Health Reform, Whose Costs Are We Talking About Anyway?

Just in time for July 4^th weekend, the numbers were out. The Congressional Budget Office (CBO) estimates that if the Better Care Reconciliation Act were to become law, approximately 22 million people will lose health insurance coverage by 2026, (15 million will lose Medicaid and 7 million will lose nongroup coverage). Federal Medicaid spending would go down by $772 billion and spending to provide tax credits to help certain people buy health insurance (along with some other coverage provisions) would decrease by $408 billion (see chart below from the CBO).

Numerous articles have been written providing additional detail and commentary on what the bill’s changes would do to the costs of premiums in the Exchanges, and individual and small group market, as well as the effects on people with Medicaid, so that is not the focus of this piece.

Instead, we’d like to point out a little mentioned aspect of one change envisioned, which is the push from Medicaid to private insurance and what that would do to health care costs.

On Fox News Sunday, June 25, 2017, Dr. Tom Price, Secretary of the U.S. Department of Health and Human Services (HHS) explained to Brit Hume:

“So, what the Senate bill does is say, every single individual between zero between — up to 350 percent of the poverty level ought to be able to have some type of tax credit that will allow them to purchase the kind of coverage that they want. And it’s a tax credit, or refundable tax credit, or advanceable, so that nobody will fall through the cracks, nobody will have the rug pulled out from under them. We want a seamless transition for those that are moving from either Medicaid to the individual market or Medicaid to the employer-sponsored market, so that individuals are able to maintain the kind of coverage that they want for themselves.”

It makes sense that the Republicans are proposing such a solution. As Avik Roy wrote recently in an op-ed for The Washington Post, “For decades, free-market health-reform advocates have argued that the single best idea for improving U.S. health care is to maximize the number of Americans who can afford to buy health insurance for themselves, instead of having to depend on the government or their employer.”

He continues, “The Senate bill repeals Obamacare’s Medicaid expansion — an expansion that has trapped more than 12 million people in a program that researchers have shown has health outcomes no better than being uninsured. In its stead, the Senate bill offers low-income Americans robust tax credits to buy affordable private health insurance, just as those formerly enrolled in Obamacare’s exchanges will be able to.”

It is probably no coincidence that Dr. Tom Price, now Secretary of HHS, is helping design a system that encourages patients to move away from government insurance – especially since government programs pay physicians and other providers so much less than commercial payers.

Two recent studies from the Congressional Budget Office (CBO) highlighted the cost differential between Medicare and commercial payers for both physician services and hospitals. For physician services, CBO concluded what many of us in health policy know, but may be surprising to some:

“Commercial prices are (sometimes substantially) higher than Medicare fee-for-service (FFS)
Medicare Advantage prices are very close to Medicare fee-for-service (FFS)
Commercial prices vary substantially across areas and within areas; Medicare Advantage prices co-vary with Medicare fee-for-service (FFS)”

Here is another chart from the CBO for those of you who are so inclined:

For inpatient hospitals, the CBO conclusion was similar:

“The average commercial payment rate for a hospital admission in 2013 was about $21,400.
The average Medicare FFS rate for the same set of stays (in the same hospitals) was about $11,400.
On average, commercial rates were 89 percent higher than Medicare FFS rates.”

The reason this matters is because Medicaid rates are even lower than Medicare rates, often purposely so. Kaiser Family Foundation, based on data compiled by the Urban Institute, publishes The Medicaid-to-Medicare Fee Index which “measures each state’s physician fees relative to Medicare fees.” In 2014, the national average for all fee-for-service physician services was 0.66; for primary care physician services it was 0.59. In other words, on average, a physician gets paid by Medicaid 66% of what he or she gets paid by Medicare for the same service.

For some services, the Medicare and commercial rates are similar, for example, preventive and primary care visits (99213, 99214, and 99203 in the chart above). For other services, commercial rates paid to physicians are more like 200% of the Medicare rate, for example, breast biopsies (19081 in chart above).

Simply put, a service that earns a physician a reimbursement of $100 in Medicare, earns her or him only $59 in Medicaid. If that service is similarly reimbursed in a commercial plan, the physician earns about 70% more if the patient has commercial insurance instead of Medicaid.

For services that aren’t primary care, the differential is bigger. The physician who is reimbursed $66 in Medicaid, receives $100 in Medicare, but $200 in a commercial plan – so treating a patient with commercial insurance instead of Medicaid earns the physician three times as much in reimbursement.

Ensuring that “individuals are able to maintain the kind of coverage that they want for themselves” and making sure people aren’t dependent on government may be reasonable policy goals.

But let’s be more honest about whether this plan will actually mean we spend less on health care in the U.S.