Greg Scandlen
Greg Scandlen is the founder of Consumers for Health Care Choices, a non-partisan, non-profit membership organization aimed at empowering consumers in the health care system.
Mr. Scandlen is an accomplished writer, researcher, and public speaker. He is considered one of the nation's experts on health care financing, insurance regulation and employee benefits. He testifies frequently before Congress, and appears on such television shows as the O'Reilly Factor, NBC Nightly News, and CNN. Mr. Scandlen gives three dozen speeches a year to organizations representing employers and labor, hospitals and physicians, insurers and pharmaceutical companies.
He has published many papers on topics such as health care costs, insurance reform, employee benefits, individual insurance programs, HSAs and HRAs, and every aspect of consumer driven health care.
Mr. Scandlen has worked for several Washington-based think tanks, was the president of the Health Benefits Group and the founder and executive director of the Council for Affordable Health Insurance. He also spent 12 years in the Blue Cross Blue Shield system, most recently as the director of state research at the national association.
Saturday, November 22, 200818,000 Deaths From Lack of Insurance?Another Misleading Factoid from the Institute of Medicine By Greg ScandlenLike other misleading claims, this one is also based on a report by the Institute of Medicine. It is based on a series of reports paid for by the Robert Wood Johnson Foundation (RWJ) and issued by IOM as part of its “Coverage Matters” series. This one is called “Care Without Coverage: Too Little, Too Late.” The study conducts no original research, but is a “meta-analysis” of existing studies. There is little consistency between these studies in quality or methods, and all are “observational rather than experimental,” as the IOM report acknowledges. The Urban Institute’s Jack Hadley conducted a similar meta-analysis at about the same time [Jack Hadley, “Sicker and Poorer: The Consequence of Being Uninsured,” Kaiser Commission on Medicaid and the Uninsured, May 2002] and was candid. He wrote, “Observational studies by themselves cannot answer the question of whether health insurance directly affects health outcomes because they cannot identify the causal direction of the relationship between insurance and health and may not be able to control for other, often unobserved, factors that might be affecting insurance coverage and health at the same time.” In other words, there may be some other condition that leads people to be both uninsured and in poor health. Very few of these underlying studies adjusted for socio-economic differences in the populations, which is a major problem since income and education are closely associated with health outcomes regardless of the kind of insurance coverage involved. [See NCPA BA #415] We know, for instance, that people on Medicare all have the same insurance coverage, but 54% of those under the poverty level report themselves as being in poor or fair health, as compared to only 25% of those above 200% of poverty. The “universal” systems in Canada, the United Kingdom, New Zealand, and Australia report even bigger income-based disparities with lower-income adults over three times as likely as higher-income adults reporting themselves to be in “fair or poor health.” While IOM did not correct for income differences in the populations (insured vs. uninsured), it had available a proxy for income. Many of the studies it looked at did separate out the Medicaid population from the uninsured and the privately insured populations. Lacking other income information, IOM might have studied people on Medicaid as being both low-income and fully-insured. But this result did not suit its predisposition, so it chose to downplay it. Deep in the report it acknowledges that, “study results for overall health status, cancer outcomes, and hospital-based care, (find that) adults with Medicaid frequently fare no better and sometimes far worse than uninsured patients in their health-related outcomes….” One might conclude that it is better to be uninsured than to be fully-insured on Medicaid. But IOM says such a conclusion would be “facile.” Why? Because Medicaid is a lousy insurance program that doesn’t pay doctors enough. Ah! But that still doesn’t explain why, if having insurance is the most important factor in health, people with no insurance fare better than people with poor insurance. In fact, the evidence strongly suggests that insurance is not the most important factor in health – income and education are. But RWJ wasn’t paying IOM to come to that conclusion. BOX What about the 18,000 deaths? The number shows up only once in the entire report, buried way back in Appendix D that explains the tortured methodology used to come up with that number. First, they rely entirely on a single study that estimated “a higher overall mortality risk for uninsured adults of 25 percent.” Linda Gorman deconstructs this original study persuasively. She notes the study by Peter Franks begins by looking at people who were uninsured or privately insured in 1971 and then looks at their mortality in 1987. Never mind that this entire population likely went through many spells of being covered or not being covered in the intervening years. IOM then assumes that the incidence of diseases like diabetes, hypertension, breast cancer, and HIV are the same in the uninsured population as they are in the privately insured population. So they multiply the death rate for the insured by 125% and get the “excess mortality” of the uninsured. Voila! 18,000 dead. There are at least two problems with this approach. First, the uninsured are not a monolithic population. They include people who are between jobs, people who are eligible for Medicaid but not yet enrolled, the young-invincibles who don’t think health insurance is valuable to them, some pretty wealthy people, some pretty poor people, and a lot in between. It also includes a large number of Latino immigrants who are newly arrived in the United States and who are pretty healthy. There is very little that unifies the uninsured, and certainly not their rate of mortality. Second, the assumption that the uninsured have the same incidence of disease is almost certainly not true for two reasons: 1. The uninsured are considerably younger than the general population, and 2. People with high risk factors are far more likely to stay insured once they have coverage. They will stay with their employer, exercise COBRA options, pay more to get and retain coverage, enter high-risk pools, and pretty much make having coverage a major priority in their lives, because they know they need it. So, once again, of all the things that might be said about the uninsured, the one thing that is almost certainly not true is that 18,000 of them die each year simply because they do not have coverage
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Wednesday, November 19, 2008The Massachusetts Model?Only if you discount those most effected By Greg ScandlenCategories: MassachusettsHarvard’s Robert Blendon continues his superlative work in measuring public opinion around health care issues in a new study of the attitudes of Massachusetts residents about that state’s health reforms. The study, published in Health Affairs, looks not only at current opinions, but tracks attitudes through the debate and consideration of the plan.One of the findings is how opinion changes once people are made aware of the costs and consequences of a reform proposal. Mr. Blendon tested attitudes towards various reform ideas in 2003. He found that 82% or respondents favored “expanding existing state programs,” but when told that “these programs would require raising taxes to pay for the cost” support dropped to 55%. Similarly with other ideas – • 76% supported an employer mandate, but that dropped to 35% when told that employers might have to pay off workers • 70% supported tax credits and deductions for the uninsured, but that dropped to 36% when people were told it might not cover the full cost of the coverage. • 56% supported an individual mandate, but that dropped to 22% were told it will cause financial hardship for the people affected. • 50% supported single payer, but that dropped to 30% when people were told that might have to wait longer for hospital and specialist care. This is part of the reason Massachussetts developed its approach that included a little bit of everything -- there was no consensus on a single best approach. Of these various approaches, the one with the least support once the trade-offs are made clear was the mandate on individuals. Mr. Blendon’s article notes that the mandate was the “most politically controversial” part of the legislation, gaining only 52% support. That level of support has increased since the law was enacted and implemented, to 57% in 2007 and 58% in 2008. But that population-wide number hides some alarming trends. Mr. Blendon writes of his 2007 survey, “Upon hearing descriptions and costs of subsidized and unsubsidized plans for an average uninsured person, 62 percent thought that it was unfair to require an uninsured person to sign up and pay for an unsubsidized plan like this. Forty-four percent thought that it was unfair to require an uninsured person to sign up and pay for a subsidized plan.” Today, the people most supportive of the individual mandate are the people least affected by it – 69&% of people making $75,000 or more per year support it while only 49% of those making between $25,000 and $50,000 do. 69% of people with college degrees support it, but only 45% of those with high school or less do. There is a growing concern among all residents that the law is hurting, rather than helping, the uninsured, with the percentage saying it is hurting growing from 15% in 2006 to 33% in 2008. The percentage saying it is helping the uninsured has dropped from 67% in 2006 to 45% in 2008. The survey digs deeper into this trend. It breaks out the population that is directly affected by the law from those who are not. Of those directly affected by the law, 60% say it is hurting them personally and only 22% say it is helping. 51% say that health care costs have gone up and only 14% say the have gone down. As a result only 37% of those directly affected now support the mandate, as opposed to 62% of those not affected. Mr. Blendon cautions that these developments could presage a backlash against the law, especially if “more people report increasing costs.”
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Saturday, November 15, 2008What's the Matter with Baucus?Senate Propsal is Wishful Thinking By Greg ScandlenI haven't had time to read the 90 pages of Sen. Max Baucus' new heath reform proposal, but I just looked at his Executive Summary and fear he is misdiagnosing the problems. To wit --He talks about “the underinsured.” That is a euphemism for CD Health, but CD health is the ONE success story out there. It is actually reducing HC spending, increasing knowledge, and improving patient behavior. He talks about uncompensated care and blames it on the uninsured. But the greatest source of uncompensated care is underpayment by Medicare and Medicaid. The uninsured is a trivial contributor. He talks about expanding Medicaid and SCHIP. But one-third of the uninsured are already eligible for those programs, but don’t bother to enroll. He does not say how he will change that. He hopes that wellness and prevention will lower costs. But there is no evidence to support any of that. In fact wellness and prevention RAISE costs. He wants to focus on wellness and prevention “RATHER THAN on illness and treatment.” YIKES!!! So he will deny treatment of illness so that a 30-year-old can get an annual physical??????????? He bemoans that fact that people wait till they need coverage to enroll, but he will add costs to the young and healthy by eliminating “discrimination” against people with Pre-Ex. He wants a Medicare buy-in for people of age 55. But he ignores the facts that 1. Medicare already has $34 trillion in unfunded liabilities. 2. That people on Medicare already pay 20%+ of their incomes in OOP spending (speak of “underinsured”). 3. That it pays only half of the elderly’s HC spending, and 4. That is is a massively clumsy and inefficient program that could never be sold on the private market. He wants employers who don’t provide coverage to pay for the uninsured. But he ignores the effect on job creation and wages. He thinks Health IT will solve a lot of problems despite all the evidence that it doesn’t. It is just a laundry list of wishful thinking. All those folks who insist that medicine be “evidence based” should apply the same standard to public policy.
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Thursday, October 16, 2008We Have Won!By Greg ScandlenAs we mentioned last week, consumer driven health care (CDHC) has reached the “tipping point” of 20% of the under-65 population. This was reported by the CDC’s National Health Information Survey (NHIS), and is confirmed by the latest Kaiser Family Foundation (KFF/HRET) survey of employer plans, which found that 18% of all workers are now in high deductible health plans. The difference can be explained by the fact that KFF/HRET looks only at employer plans while the NHIS survey looks at the whole population, including those in individual plans. Virtually the entire individual market is in high deductible plans these days. Not every one will agree, but I argue that a HDHP is a consumer driven plan even if it does not include an HSA or HRA. The goal of consumer empowerment is to take money away from third-party payers and put it in the hands of consumers to spend as they wish. You don’t need a tax-favored savings account to make that happen. If someone doesn’t pay income taxes (which is the case for 40% of the population), there is no particular reason to have a tax-favored account. These folks will still be paying cash for services but they may keep their cash anywhere – in a regular savings account, a checking account, or in their mattress. This latter option is looking pretty attractive after the past year of a bear market. Some critics call an employer-sponsored HDHP cost-shifting -- mean and nasty employers make employees pay for services that used to be covered by the health plan. But as Mark Pauley demonstrates in Health Affairs, employees pay for the health plan in the form of reduced wages. It doesn’t much matter if the payment for the health service comes from the health plan or directly from the employee, employees are paying for it either way. Except it is, first, far more efficient to pay for small claims directly rather than going through an insurance mechanism, and second, the opportunity to save money changes behavior on the part of patients. They become better educated and more reluctant to waste money than they are when somebody else is paying the bill, or seems to be. Now that we have 20% of the population paying some of their own bills, we should begin seeing a profound effect on the service side of the ledger. Every physician, every hospital, every pharmacy will have a fair number of cash-paying patients and will have to adjust their billing procedures and customer service departments accordingly. They will become literally invested in serving a cash-paying retail market. They will want to defend their investment. And that changes the political dynamic substantially. This is a whole new reality and one that Washington will not be able to tamper with lightly. Congratulations!
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Friday, October 10, 2008The Tipping Point is HereBy Greg ScandlenThe annual survey of the Centers for Disease Control finds that 20.3% of all people under age 65 have a high deductible health plan (HDHP) – more than the number covered by public programs (19.4%). The HDHP is defined as having a deductible of at least $1,100 for an individual or $2,200 for a family. Over one-fourth of this number also had a dedicated account (HRA or HSA).
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Thursday, October 2, 2008Ninth Circuit Does It AgainSan Francisco Decision Will be Reversed By Greg ScandlenCategories: CaliforniaThe Ninth Circuit has issued another ruling that is certain to be overturned by the Supreme Court, keeping intact its record as the most reversed appeals court in the United States.A three judge panel of the court ruled that San Francisco’s play-or-pay mandate on employers does not violate ERISA, “because it does not require the creation of an "employee welfare benefit plan" within the meaning of that federal law,” according to an article by Joanne Wojcik in Business Insurance. But ERISA does not apply only to laws “creating” an employee welfare benefit plan, but laws “relating to” such a plan. There is no question that this law “relates to” these plans, and so shall be overturned by the Supreme Court just as every other similar attempt has been over the past 30 years. As Chris Reed put it in a San Diego Tribune blog, “The 9th is rewriting plainly written law. No employer mandate has ever withstood a federal court challenge until now. That's because ERISA says states can't tell employers what benefits to provide. I repeat my promise to eat a printout of this blog item if the Supreme Court upholds the San Francisco law. This is a slow-motion farce.”
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Saturday, September 27, 200898,000 Die Every Year From Medical Errors?By Greg ScandlenMedical errors are tragic when they occur. Certainly hospitals should be places of safety, not of peril, and hospitals need to deal seriously with issues like medication errors, preventable infections, and even mundane things like hand washing between patients. But injecting hysteria is not helpful. One commentator was quoted as saying, "The equivalent of 390 jumbo jets full of people are dying each year due to likely preventable, in-hospital medical errors, making this one of the leading killers in the U.S." Egads. The higher one was based on an examination in 1984 – twenty-four years ago – of 31,000 admissions in New York that found 173 patients who died "at least in part because of an adverse event," according to a review in the Journal of the American Medical Association (JAMA) . Even the definition of an "error" was suspect, being based on the opinion of three physicians who reviewed the medical records. The lead researcher of these two studies, Trowen Brennan, MD, JD, cautioned against reading too much into his results, as reported by John Dunn, MD, JD in an analysis published by the Heartland Institute. The lower estimate of 44,000 deaths is based on a more recent (1992) review of hospital records in Utah and Colorado that was similarly extrapolated to the entire population.
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Saturday, September 13, 2008Don't Bet on P4POnce again, the cure may be worse than the disease By Greg ScandlenProminent on any list of painless remedies in health care is “Pay For Performance (P4P)” -- pay the Docs more when they perform well. But like most platitudes, the reality of P4P may be worse than the problem it is trying to solve, according to Dr. Sandeep Jauhar in the New York Times.Dr. Jauhar writes, “On the surface, (P4P) seems like a good idea: reward doctors and hospitals for quality, not just quantity. But even as it gains momentum, the initiative may be having untoward consequences.” He cites an earlier example of “quality improvement” – surgical report cards. “In the early 1990s, report cards were issued on surgeons performing coronary bypasses. The idea was to improve the quality of cardiac surgery by pointing out deficiencies in hospitals and surgeons; those who did not measure up would be forced to improve. But studies showed a very different result. In a survey in New York State, 63 percent of cardiac surgeons acknowledged that because of report cards, they were accepting only relatively healthy patients for heart bypass surgery.” In the case of P4P, he writes, “Consider the requirement from Medicare that antibiotics be administered to a pneumonia patient within six hours of arriving at the hospital. The trouble is that doctors often cannot diagnose pneumonia that quickly. Under P4P, there is pressure to treat even when the diagnosis isn’t firm. So more and more antibiotics are being used in emergency rooms today, despite all-too-evident dangers like antibiotic-resistant bacteria and antibiotic-associated infections.” He concludes, “Whenever you try to legislate professional behavior, there are bound to be unintended consequences.”
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Friday, August 29, 2008Listen Up, Conservatives!Time to pay attention to health care By Greg ScandlenThe American Spectator ran a terrific article by Philip Klein about the need for conservatives to pay attention to health care. It is a comprehensive look at the problems in the current system, especially the fundamental flaws of employer-based third-party payment combined with excessive regulations, all of which combine to drive up costs and limit choice. He describes how “progressives” are focusing on these problems in order to grow the power and influence of government, while conservatives are hiding under the blankets or helping to pass liberal “reforms” in order to stave off even worse outcomes. But “there’s no reason for conservatives to be torn between indifference and acquiescence on one of the most important domestic issues of our time,” he writes. The current perception that “conservatives want to preserve (the existing system)” is “a losing argument.” Instead, “It is important for conservatives to point out that far from having a free market, America is a nation whose health-care system is suffering from ham-handed government intrusions into the free market.” He lays out the argument for expanding free markets in health care and quotes many CHCC members in the process, including Regina Herzlinger, John Goodman, David Gratzer, Bob Hurley, and yours truly. This might be one of the most important magazine articles on these issues since Milton Friedman’s 2001 essay in the Public Interest. Let’s hope it is widely circulated and read by our “ready to surrender” friends.
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Saturday, August 16, 2008Are Americans Alone in Being Disgruntled?By Greg ScandlenThe Commonwealth Fund (not to be confused with Pennsylvania’s Commonwealth Foundation) has issued another report on how awful the American health care system is. This report is based on a Harris Interactive poll of 1,004 people age 18 or older. It was written up by Sabrina K.H. How, Anthony Shih, Jennifer Lau, and Cathy Shoen. The take-away factoid is, “the health care system does not serve the public well – eight of 10 respondents say it needs to be fundamentally changed or completely rebuilt.” This breaks down into 32% saying it needs to be "completely rebuilt,” 50% saying it needs “fundamental change,” and 16% saying in needs “only minor change.” Wow! Pretty sobering, eh? Well, it would be if these attitudes were unique to the United States. But they are not. In fact, although she doesn’t mention it here, Ms. Shoen was also co-author of a 2002 article in Health Affairs that asked people in five English-speaking countries the exact same question – “When looking at your own health care system, would you say it needs only minor change, fundamental change, or to be completely rebuilt?” In every country about 80% of the population said their own system needs either fundamental change or to be completely rebuilt. In 2001, the percentages that said their own system needs only “minor change” was 25% for Australia, 21% for Canada, 18% for New Zealand, 21% for the United Kingdom, and 18% for the United States. In fact, the “minor change” result (the most favorable) plummeted in Canada from 56% in 1988/1990 to 21% in 2001, from 34% to 15% in Australia, and from 27% to 21% in the UK (New Zealand wasn’t included in the earlier survey). In the United States “minor change” increased from 10% in 1988/1990 to 18% in 2001. So opinion significantly improved in the States while it was dropping in the other countries. On might think that Ms. Shoen would have mentioned these results in her latest paper, just to put the survey results in context. But, so it goes in public policy research these days – no context, no balance, no real understanding. Just one-sided advocacy. And you wonder why we get lousy policy that never seems to work?
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