Health Care ReformHealth Care ReformQuynh SmithQuynh Smith

Sources of Inefficiency in the Sources of Inefficiency in the Health Care Delivery SystemHealth Care Delivery System

We spend a substantial amount on high cost, low-value treatments.

Patients obtain too little of certain types of care that are effective.

Patients frequently do not receive care in the most cost-effective.

There is extensive variation in the quality of care provided to patients.

There are many preventable medical errors that lead to worse outcomes.

Our system is complex and we have high administrative costs.

What is Health Care Reform?What is Health Care Reform?

Broaden the population that receives health care Broaden the population that receives health care coverage through either public sector insurance coverage through either public sector insurance programs or private sector insurance companies programs or private sector insurance companies

Expand the array of health care providers Expand the array of health care providers consumers may choose among consumers may choose among

Improve the access to health care specialists Improve the access to health care specialists Improve the quality of health care Improve the quality of health care Decrease the cost of health care Decrease the cost of health care

Trends in Health Care Trends in Health Care Spending and CostSpending and Cost

Overall Spending Overall Spending

Based on Organization of for Economic Co-Operation and Development (OECD): The U.S. devotes considerably more of its

economy to health care than other developed countries.

U.S. health spending as a share of GDP in 2006 (15.3%) was considerably higher than all other countries, including Canada (10.0%), France (11.0%), Germany(10.6%), Japan (8.1%), and the United Kingdom (8.4%).

Switzerland was a distant second to the U.S., devoting an estimated 11.3% of GDP to health care.

Overall SpendingOverall Spending According to the Centers for Medicare and Medicaid

Services (CMS), the U.S. is projected to spend over $2.5 trillion on health care in 2010, or $8,160 per U.S. resident.

Health spending in 2009 is projected to account for 17.6% of GDP.

In 1970, U.S. health care spending was about $75 billion, or $356 per resident, and accounted for 7.2% of GDP.

Health care spending has risen about 2.4 percentage points faster than GDP since 1970.

CMS projects that by 2018, health care spending will be over $4.3 trillion, or $13,100 per resident, and account for 20.3% of GDP.

Distribution by ServiceDistribution by Service

Sources of Health SpendingSources of Health Spending

Between private and public sectors, Between private and public sectors, private health spending accounts for 54% private health spending accounts for 54% of total health spending in 2007.of total health spending in 2007. 64% expenditures from private health 64% expenditures from private health

insuranceinsurance 22% expenditures from out-of-pockets22% expenditures from out-of-pockets 13% by other private sources (philanthropy)13% by other private sources (philanthropy)

Sources of Health SpendingSources of Health Spending

CMS projects that the private share of national health spending will fall to 49% by 2018, with public spending growing to 51% as the oldest baby boomers become eligible for Medicare.

Rises in Premiums of Health Rises in Premiums of Health InsuranceInsurance

Between 1999-2008, the cumulative Between 1999-2008, the cumulative growth in insurance premiums was 119%.growth in insurance premiums was 119%.

Compared with cumulative inflation of 29 Compared with cumulative inflation of 29 % and cumulative wage growth of 34%.% and cumulative wage growth of 34%.

Uninsured in AmericaUninsured in America

Percent of Americans Uninsured by Percent of Americans Uninsured by AgeAge

Who Are the Uninsured?Who Are the Uninsured?

More than eight in ten of the uninsured are in working families—about two thirds are from families with one or more full-time workers and 14% are from families with part-time workers.

About two-thirds of the uninsured are poor or near poor.

Adults are more likely to be uninsured than children.

The number of nonelderly uninsured Americans rose to 45.7 million in 2008 amidst rising unemployment rates and an economic recession.

2009 Federal Poverty Line2009 Federal Poverty Line

American Recovery and American Recovery and Reinvestment Act 2009Reinvestment Act 2009

Provided over $2 billion to expand the number of sites, increase services at existing CHCs, and provide supplemental payments for spikes in the number of uninsured CHCs serve as a result of the recession.

Texas vs. United StatesTexas vs. United States

Texas vs. United StatesTexas vs. United States

Texas vs. United StatesTexas vs. United States

President Obama’s President Obama’s ProposalProposal

President Obama’s Health PlanPresident Obama’s Health Plan

Reduce long-term growth of health care costs for Reduce long-term growth of health care costs for businesses and government businesses and government

Protect families from bankruptcy or debt because of Protect families from bankruptcy or debt because of health care costs health care costs

Guarantee choice of doctors and health plans Guarantee choice of doctors and health plans Invest in prevention and wellness Invest in prevention and wellness Improve patient safety and quality of care Improve patient safety and quality of care Assure affordable, quality health coverage for all Assure affordable, quality health coverage for all

Americans Americans Maintain coverage when you change or lose your job Maintain coverage when you change or lose your job End barriers to coverage for people with pre-existing End barriers to coverage for people with pre-existing

medical conditionsmedical conditions

Public Opinion on Health Public Opinion on Health ReformReform

Health Care ProposalsHealth Care ProposalsSenate Democratic Bill (Patient Protection Senate Democratic Bill (Patient Protection

Affordable Care Act)Affordable Care Act)AndAnd

House Bill (Affordable Health Care for House Bill (Affordable Health Care for America Act)America Act)

The House and Senate versions:The House and Senate versions:

Insurance reforms to protect consumers from insurance Insurance reforms to protect consumers from insurance company worst-practices – like denying coverage based company worst-practices – like denying coverage based on pre-existing conditions, capping total coverage, and on pre-existing conditions, capping total coverage, and dropping or watering down coverage when you get sick dropping or watering down coverage when you get sick and need it mostand need it most

Consumer protections that will restrict how much of Consumer protections that will restrict how much of your premium dollars insurance companies can spend your premium dollars insurance companies can spend on marketing, profits, salaries.on marketing, profits, salaries.

Creation of a health exchange to increase consumer Creation of a health exchange to increase consumer choice and guarantee coveragechoice and guarantee coverage

A commitment to expanding health coverageA commitment to expanding health coverage Affordable health options, with subsidies for working Affordable health options, with subsidies for working

families and a hardship waiverfamilies and a hardship waiver Tax credits to help small businesses afford coverageTax credits to help small businesses afford coverage

The House and Senate versions:The House and Senate versions:

Improvements in the health status of our population Improvements in the health status of our population by investing in prevention and chronic disease by investing in prevention and chronic disease managementmanagement

Making preventive care completely free – with no Making preventive care completely free – with no copayments or deductiblescopayments or deductibles

Lowering the cost of health care for our seniorsLowering the cost of health care for our seniors Improving the quality and extending the life of Improving the quality and extending the life of

MedicareMedicare Strengthening our primary care workforceStrengthening our primary care workforce Reforming the delivery systemReforming the delivery system Ensuring that reform is not only fully paid for, but Ensuring that reform is not only fully paid for, but

actually significantly reduces the federal deficitactually significantly reduces the federal deficit

Health Reform Subsidy Health Reform Subsidy Calculator Calculator

Senate Democratic BillSenate Democratic Bill

Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an employer). All individuals and families with incomes at or below 133% of the federal poverty level will be eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.

$14,404 150 $21,660 200 $43,320 400

Actual annual plan premium:

Cap on premium as % of income:

Person/family premium payment:

% of total premium paid by person/family:

Person/family payment as % of income:

Government subsidy:

6.1%

$0

$2,637

6.3%

$1,365

52%

6.3%

$1,273

$2,637

9.8%

$2,637

100%

Medicaid

Medicaid

Medicaid

Single Adult: Age 25

Medicaid

Medicaid

Medicaid

Annual Income

% PovertyAnnual Income

% Poverty % PovertyAnnual Income

Senate Democratic BillSenate Democratic Bill

$29,327 133 $44,100 200 $88,200 400

Actual annual plan premium:

Cap on premium as % of income:

Person/family premium payment:

% of total premium paid by person/family:

Person/family payment as % of income:

Government subsidy:

8.1%

$0

$7,108

6.3%

$7,108

39%

6.3%

$4,330

$7,108

9.8%

$7,108

100%

Medicaid

Medicaid

Medicaid

Age 25: Family of 4

Medicaid

Medicaid

Medicaid

Annual Income

% PovertyAnnual Income

% Poverty % PovertyAnnual Income

Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an employer). All individuals and families with incomes at or below 133% of the federal poverty level will be eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.

House BillHouse Bill

Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an employer). All individuals and families with incomes at or below 150% of the federal poverty level will be eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.

$16,245 150 $21,660 200 $43,320 400

Actual annual plan premium:

Cap on premium as % of income:

Person/family premium payment:

% of total premium paid by person/family:

Person/family payment as % of income:

Government subsidy:

7.3%

$0

$3,169

5.5%

$1,191

38%

5.5%

$1,978

$3,169

12.0%

$3,169

100%

Medicaid

Medicaid

Medicaid

Single Adult: Age 25

Medicaid

Medicaid

Medicaid

Annual Income

% PovertyAnnual Income

% Poverty % PovertyAnnual Income

House BillHouse Bill

Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an employer). All individuals and families with incomes at or below 150% of the federal poverty level will be eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.

$33,075 150 $44,100 200 $88,200 400

Actual annual plan premium:

Cap on premium as % of income:

Person/family premium payment:

% of total premium paid by person/family:

Person/family payment as % of income:

Government subsidy:

9.7%

$0

$8,543

5.5%

$2,426

28%

5.5%

$6,117

$8,543

12.0%

$8,543

100%

Medicaid

Medicaid

Medicaid

Age 25: Family of 4

Medicaid

Medicaid

Medicaid

Annual Income

% PovertyAnnual Income

% Poverty % PovertyAnnual Income

QUESTIONS?QUESTIONS?