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Show Constituents Love by Giving Health Care Freedom

February 14, 2017

Consumer Power Report #535

Lawmakers who failed to display appropriate affection for their constituents leading up to Valentine’s Day in 2017 still have time to show voters some love. Most national and state elected officials made promises on the campaign trail to make important changes in office to improve tense relationships between the governed and their government.

The road to the doghouse is paved with good intentions. Although 2017 is still young, legislative sessions will soon expire: one in February, eight in March, 11 in April, 11 in May, and nine in June. For 17 states, crossover deadlines land in February and March, heightening the urgency for lawmakers to declare their honorable intentions.

Nothing says “I love you” like giving people health care freedom. Here is a bouquet of state health care reforms lawmakers should offer to the people whose love got them elected:

Repeal certificate-of-need (CON) laws. Lawmakers in 35 states should stop swooning over hospital association political support and dollars and should instead repeal protectionist laws blocking new medical facilities operators from entering the market. CON laws require new operators to obtain special approval from a state board before opening hospitals or other health care facilities. Unfortunately, entrenched special interests, such as existing hospitals whose leadership fears competition, typically weigh in on CON decisions, arguing new facilities would put existing hospitals out of business and put patients at risk.

Consequently, CON laws restrict one of the free market’s most powerful forces: competition. Hospitals insulated from the possibility that patients will find better value elsewhere have little need to improve their facilities, services, or prices. CON laws also use arcane population-counting criteria to determine whether medical facilities may purchase imaging equipment.

Protect direct primary care (DPC) from insurance regulations, and launch pilot programs treating Medicaid patients with DPC. Only 13 states have passed laws specifying DPC is not a form of insurance and shall not be regulated as insurance. The remaining 37 states fail to ensure their insurance commissioners will not shut down new DPC practices. Consequently, physicians are hesitant to treat patients within DPC’s innovative model, in which physicians give patients a range of preventive care services and tests in exchange for a monthly fee as low as $25 per patient, paid directly to their doctors, bypassing insurance.

Many lawmakers mistake DPC for concierge medicine and therefore fail to recognize DPC as a health care solution for all patients, including low-income patients. Unlike DPC doctors, concierge doctors bill insurance in addition to charging patients $1,500 to $5,000 per year. Supposedly, concierge’s value lies in its 24/7 access, but most DPC providers offer a form of 24/7 access (such as through telemedicine) for pennies on the dollar compared to concierge.

Grant physicians reciprocity for treating patients by telemedicine. Simple reciprocity would allow physicians licensed in one state to treat by telemedicine patients located in a state with similar medical licensure requirements, without the hassle and expense of applying for licenses issued by other states. This proposal differs sharply from the Interstate Medical Licensure Compact circulating among the states, which merely expedites the application process by which physicians in one state obtain out-of-state licenses.

The Compact also establishes a new layer of bureaucracy between physicians and patients. Although the Compact will, one hopes, expand patient access to health care providers across state lines, reciprocity would be simpler. In health care policy, as in all policy, less is usually more.

License new kinds of midlevel providers and allow all providers to treat patients using skills at the top of their licenses. The benefits of allowing patients to obtain health care from midlevel practitioners such as physician assistants, nurse practitioners, and pharmacists are well established. A comparable profession within oral health care is the dental therapist. Dental therapists have practiced in more than 50 countries for 95 years, yet in the United States, they practice only in Alaska, Minnesota, and tribes in Oregon and the state of Washington. Maine and Vermont have recently authorized therapists to practice, but none yet works in those states.

Entrenched special-interest groups such as state dental associations typically oppose legislation allowing therapists to gain licensure, arguing therapists are insufficiently trained. But facts are stubborn things. Therapists emerge from the three-year training program at the University of Minnesota School of Dentistry with more training than dentists to perform the approximately 80 procedures Minnesota law lets therapists perform. Opponents also underappreciate that dentists would remain free not to hire therapists and would remain responsible for supervising the quality of care their employees provide.

States should also remove barriers preventing pregnant mothers from obtaining care from midwives instead of exclusively from obstetrician-gynecologists. California law, for example, bars certified nurse-midwives from practicing as hospital employees. Alabama law has generated a black market for midwives and patients. Lawmakers should trust pregnant patients’ maternal instincts and let these women choose their own health care providers.

Not all significant others will agree with the adage “better late than never,” but it’s worth a shot with constituents (and spouses). Lawmakers should trust the people who had the good sense to elect them to have the good sense to choose the health care providers offering the best value.

- Michael T. Hamilton (mhamilton@heartland.org, @MikeFreeMarket) is a Heartland Institute research fellow and managing editor of Health Care News, author of the weekly Consumer Power Report, and host of the Health Care News Podcast.


IN THIS ISSUE:


ALASKA PRICE TRANSPARENCY BILL WOULD MAKE HOSPITALS POST PRICES ONLINE

Monday, Representative Ivy Spohnholz (D-Anchorage) introduced legislation to require health care providers and facilities to post the full price of their most common services and procedures. Reporting entities would be required to post health care price information on their premises, online, and to the state.

Health care providers including individual doctors and practitioners would be required to provide the average undiscounted price charged to individuals for each of their 25 most frequently performed health care services. Additionally, health care facilities including hospitals and clinics would be required to provide the same information for the 50 most frequently performed health care services provided at the facility.

The costs of health care in Alaska are significantly higher in comparison to other states and are increasing faster than the rate of inflation. According to data from Premera Blue Cross Blue Shield of Alaska, the average cost of a knee replacement in Alaska is $10,218 and the same procedure costs an average of $2,042 in Seattle. Knee replacements cost five times as much locally. For some procedures the ratio is as great as ten to one.

“Why would someone pay five or ten times as much in Alaska for a non-emergency procedure like a knee replacement they could have done out of state? The problem is that patients don’t know the variation of price in health care,” said Rep. Spohnholz. “How much something is going to cost should not be a mystery.”

These factors create a substantial information barrier that prevents consumers from having the information they need to make the best decisions for themselves. Rep. Spohnholz believes House Bill 123 could start to change the culture of health care in Alaska.

“While this transparency measure will allow basic market forces to help control costs; we also hope that it will start to change the paradigm of health consumers,” said Rep. Spohnholz, who chairs the House Health and Social Services Committee. “With cell phones and cars, consumers have tremendous power because they can choose an alternate provider if they are unsatisfied with service. Alaskans should feel like they know what they are getting into when purchasing health care too.” …

SOURCE: Michael Mason, Alaska Native News


NEW REPORTS PAINT MIXED PICTURE OF STATE TELEMEDICINE LAWS

The American Telemedicine Association (ATA) has issued twin reports that update its information on state legislation affecting telemedicine. Current state policies appear to favor telemedicine, but the amount of change in those policies has been fairly modest in the past few years.

“Our analysis reveals a mix of strides and stagnation in state-based policy despite decades of evidence-based research highlighting positive clinical outcomes and increasing telemedicine utilization,” said the executive summary of the report on telemedicine coverage and reimbursement.

For the first time since the ATA’s initial report in 2014, all state Medicaid agencies have adopted some form of telemedicine coverage. In the past year, the ATA said, seven states - Connecticut, Florida, Hawaii, Idaho, Rhode Island, Utah, and West Virginia - have improved coverage and reimbursement. Delaware, South Carolina, and the District of Columbia either lowered or further restricted coverage.

Thirty-one states plus the District of Columbia have enacted parity laws that require private insurers to cover telemedicine visits the same way they cover in-person encounters, the report noted. Ten of those measures have been passed since 2014. Twenty-four states and the District of Columbia have policies that authorize statewide coverage without provider or technology restrictions.

The report cites Texas as having the most stringent clinical practice rules for telemedicine providers when compared with in-person practice. However, telemedicine firms and doctor groups in Texas recently agreed on draft legislation that would substantially ease restrictions on telemedicine in that state.

Twenty states have either no parity law or numerous barriers to parity. The reason why more states cover telemedicine under Medicaid than require private insurers to cover it is that state legislatures must pass laws to mandate health plan coverage. Medicaid programs, in contrast, make their own rules, subject only to federal oversight, Latoya Thomas, director of the ATA’s State Policy Resource Center, explained to Medscape Medical News.

Under Medicaid, 28 states do not specify a patient setting as a condition for payment. Forty states recognize a patient’s home as an originating site. …

Meanwhile, more states have revised their telemedicine policies to remove the requirement that a healthcare professional, or telepresenter, be with a patient during a virtual encounter with another provider. Thirty-four states do not require a telepresenter during an encounter.

Another obstacle to telemedicine has been state licensing laws that require physicians to be licensed in the state where their patient resides when they practice telemedicine, the ATA’s other report pointed out. Eighteen states have enacted laws to join the Interstate Medical Licensure Compact, which is about to start granting crossborder licenses. In addition, the report noted, several states accept a conditional or telemedicine license from out-of-state physicians or have established registries of out-of-state physicians permitting them to practice in state. …

SOURCE: Ken Terry, Medscape


SEN. GRASSLEY LAUNCHES INQUIRY INTO ORPHAN DRUGS AS CAUSE OF HIGH DRUG PRICES

Republican Sen. Chuck Grassley, chairman of the Senate Judiciary Committee, has opened an inquiry into potential abuses of the Orphan Drug Act that may have contributed to high prices on commonly used drugs.

In a statement, Grassley said the inquiry is “based on reporting from Kaiser Health News” and strong consumer concern about high drug prices.

“My staff is meeting with interested groups and other Senate staff to get their views on the extent of the problem and how we might fix it,” Grassley wrote on Feb. 3, adding that he will continue to work on bringing prices down in other ways as well.

A six-month Kaiser Health News investigation published in January found that the orphan drug program intended to help desperate patients is being manipulated by drugmakers. While the companies are not breaking the law, they are using the 1983 Orphan Drug Act to secure lucrative incentives and gain monopoly control of rare disease markets where drugs often command astronomical price tags.

KHN’s investigation, which was published and aired by NPR, found that many drugs that now have orphan status aren’t entirely new. More than 70 were drugs first approved by the Food and Drug Administration for mass market use. Those include cholesterol blockbuster Crestor, Abilify for psychiatric disorders, and rheumatoid arthritis drug Humira, the best-selling drug in the world.

Others are drugs that have received multiple exclusivity periods for two or more rare conditions. About 80 drugs fall into this latter category, including cancer drug Gleevec and wrinkle-fighting drug Botox.

Before the Orphan Drug Act passed, drugs for rare diseases were often abandoned during development - hence the name orphan. The patient populations were simply too small to be financially viable.

SOURCE: Sarah Jane Tribble, RealClearHealth


CALIFORNIA GOVERNOR DOUBLES DOWN ON OBAMACARE DEPENDENCY TRAP

In an unusually impassioned speech, Gov. Jerry Brown vowed Tuesday to protect California’s health care gains under Obamacare against Republican attempts in Washington, D.C., to roll them back.

“More than any other state, California has embraced the Affordable Care Act,” Brown told state legislators and appointees in his annual State of the State address at California’s Capitol. “I intend to join with other Governors and Senators, and with you, to do everything we can to protect the health care of our people.”

Brown said California would not “turn back” on advances it’s made in health coverage under pressure from the new Republican administration in Washington. Under the new federal leadership, he said, the “future is uncertain and dangers abound.”

Health coverage for Californians under the Affordable Care Act “has come with tens of billions of dollars from the federal government,” said Brown. “Were any of that were to be taken away, our state budget would be directly affected, possibly even devastated.”

Leveraging an estimated nearly $20 billion federal money, health coverage has been extended to five million Californians under Obamacare, which includes federally subsidized private health plans and an expansion of eligibility for Medicaid, the program for low-income people - known in this state as Medi-Cal.

SOURCE: Pauline Bartolone, California Healthline

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Author
Michael Hamilton writes and edits for the liberty-minded clients of Good Comma Editing, LLC, a freelance writing and editing company.
media@heartland.org @MikeFreeMarket

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