Health Insurance Saves Lives? The Story Behind the Story

"Does Romneycare save lives?"

It stands to reason that the road that goes from being sick and getting decent medical care is lined with "health insurance." Studies like this suggest persons without it are more likely to ignore or discount early symptoms that lead to preventable disability or death. 

Yet, research on that topic has been somewhat murky. Most studies have focused on Medicaid as a surrogate for all insurance. Some research suggests that it has no impact on health outcomes, while other studies say it can lead to unnecessary and even dangerous care.

That's why this study that was just published in the Annals of Internal Medicine is important.  It says insurance saves lives.

As Population Health Blog readers may recall, Massachusetts required its citizens to buy into "Romneycare" health insurance long before we had even heard of the controversial term "mandate." 

Years later, researchers wanted to know if Romneycare - and by implication, its mandate - made any difference in the most important outcome of all: death rates.

The researchers used a "quasi experimental" design that contrasted the county death rates in Massachusetts counties before (2001 through 2005) and after (2007 through 2010) the advent of Romneycare to a set of "propensity matched" counties from New England states that had no health reform.

Mortality data was obtained from the CDC. The analysis was limited to adults aged 20 to 64 years and adjusted for country level age, gender, race, poverty rates, income, baseline mortality rates and unemployment rates.

Results?

During the baseline "before" years, there were no statistically significant differences in mortality between the Massachusetts counties and the control counties.  That changed. During the "after" years, mortality, compared to the control counties, statistically significantly declined by 2.9% or by 8.2 persons per 100,000. As further evidence of the impact of insurance reform, elderly populations from the same counties - who presumably had before and after access to Medicare - showed no differences over time.

The paper has a graph that displays mortality rates year after year, and while Massachusetts had a slightly lower (and statistically nonsignificant) baseline mortality rate, there is a small but credible divergence downward over time compared to the control counties.

The Population Health Blog finds the study credible. Propensity matching is the next best thing to a randomized clinical trial, and this study uses a valid concurrent control group to support the notion that health insurance saves lives.  Nothing else seems to have accounted for the drop in the death rate.

But.....

1) In clinical medicine, one gauge of treatment effectiveness is "number needed to treat" (or "NNT"). "High value" NNTs range in the 20 to 100 range (i.e., a doctor has to "treat" "100" patients with a particular condition to "cure" one).  While every life is precious, Massachusets has taught us that the Romneycare's NNT is 830.*  In other words, we have to mandate insurance for over 800 persons to save one life.  That's not unreasonable, but after mishaps like this, we should be open to finding better ways to accomplish it.

2) Prior to the institution of Romneycare, Massachusetts maintained a fund that could be used to compensate hospitals for the care of uninsured persons.  Since that was a de-facto form of insurance, the Population Health Blog is less confident that the 2.9% difference in mortality rates is a black/white narrative on the transition from "no" insurance to "full" insurance.  Rather it's about a transition from one financing mechanism to another.  That being said, real insurance would seem to "beat" other forms of health care financing.

3) Can the life-saving track record of a Romneycare mandate be applied to Obamacare's mandate?  While there are some important similarities, that doesn't necessarily mean that what works in urban Boston will work in rural Mississippi.  More research will be needed, and the Population Health Blog predicts much of it will involve propensity matching.

4) Last but not least, a large part of Romneycare's mandate facilitated the expansion of commercial insurance.  This paper doesn't help the Population Health Blog to compare the relative life-saving merits government-run Medicaid vs. a private not-for-profit like Blue Cross Blue Shield.  That'll also take more research. 

Image from Wikipedia

*An astute reader alerted the PHB that it had initially posted a NNT number spuriously calculated off the 8.2 per 100K difference described above.  The authors of the Annals paper correctly give the number as 830.

Mandates, Pink Slime and Surreptitious Patient Recruitment for Disease Management

The opening Supreme Court Affordable Care Act (ACA) deliberations focused on the obscure 1867 Anti-Injunction Act and whether the mandate is a "tax." It's not until the day two of arguments that The Nine Lawyers will take on the "individual mandate."

While the Disease Management Care Blog delights in the mandate's constitutional dilemmas, it also knows that the provision does nothing about the United States' health care cost dilemma.

That day of reckoning yet awaits.

Obliging more health persons into the insurance "risk" pools is fundamentally an exercise in spreading the same risk and health care costs over a larger population. While individuals may see their health insurance premium decline thanks to more persons paying into the system, the total consumption of health care services has no reason to slow down. A mandate by itself will not reduce costs.*

Speaking of saving money, the omnivorous DMCB, spent some of its teenage years living on a country farm. The family did its own butchering and, never leaving anything to waste, did everything it could to use every scrap of meat. As far as the DMCB is concerned, "pink slime" a.k.a. "boneless meat trimmings" is a virtuous confluence of that same thrift on an industrial scale combined with centrifuges and ammonia. Talk about a slaughter.

Last but not least, the DMCB got one more population health management insight from Charles Duhigg's book The Power of Habit. In it, Mr. Duhigg describes how Target's brainiacs discovered an association between the emergence of new buying habits in young women and early pregnancy. While that classic exercise in predictive modeling is not new, what happened next was insightful: creeped out Target customers pushed back when they unexpectedly started getting maternity and baby product coupons. In response, Target learned to camouflage its recruitment efforts by disseminating its coupons with random and unrelated product offers. The DMCB wonders if the same surreptitious approach could somehow be adapted to recruit high risk patients into population health management.  $5 toward text messaging if we can ask you some questions about your wellness.... and diabetes.

*Assume for a moment that 90 persons have health insurance which costs $500 a year.  That "pools" 90 x $500 or $45,000 in resources that are available pay for persons that need to be in a hospital.

Then assume 4 persons get sick - one gets appendicitis, one is involved in a car accident, one gets gets an infected paper cut  and the last one neglects to follow a DMCB spouse preventive health recommendation and gets what he deserves.  If the average cost per hospitalization is $10,000, the total cost is $40,000.  That leaves $5000 left over.

Cost of the insurance for each of the 90 persons: $500.
Cost of the illness for each of the 90 persons : $444.
Total amount of money going to the insurance company: $45,000.
Total cost of the illness: $40,000.
Amount that goes to the insurance company's bottom line: $5000

One year later, the 90 persons realize that there are ten persons living in their community who are not buying insurance.  Assume these freeloaders are healthy.  The 90 persons have a majority and pass an ACA with a mandate.  Over the next year, four other persons get sick again.

Cost of the insurance for each of the 100 persons: $500.
Cost of the illness for each of the 100 persons : $400.
Total amount of money going to the insurance company: $50,000.
Total cost of the illness: $40,000
Amount that goes to the insurance company's bottom line: $10,000

Of course, it's more complicated than that.  Of the ten forced to buy insurance, some have preexisting conditions and the cost of a hospitalization rises year after year, but that doesn't change the basic math underlying a mandate: total health care costs are the same, but they're spread over a larger base population.

The Constitutionality of the Affordable Care Act: From Twitter to the Supremes

In a hyperconnected fit of participatory democracy, the White House's Deputy Chief of Staff Nancy-Ann DeParle hosted a Twitter health reform Q and A under the hashtag "WHChat." "Tweeps" poised questions using 140 characters or less and Nancy responded in 140 characters or less. The sanitized White house version extolling the virtues and constitutionality of the Affordable Care Act (ACA) is here, but if you look at what actually happened in Twitter, most questions ranged from rhetorical to outright obnoxious. That being said, there were some deliciously irreverent flamers like:

#WHChat Give me a motorcycle helmet! I could be hospitalized if I don't get one for free

#WHChat My Best Buy extended cell phone warranty won't cover my wife's birth control. Why does Best Buy hate women

#WHChat Can you look at this mole and let me know what you think? Oh, not those kind of questions

#WHChat what's the official twitter hash tag for his "take over" executive order?

If all this Twittering has prompted a renewed interest in the upcoming SCOTUS arguments next week on the constitutionality of the ACA, you may want to check out this article examining the merits and the "severability" of the individual mandate. If the mandate is separated from the Court, it's possible that the ACA will be ruled constitutional, but the mandate itself will be struck down.

Drs. Sessions and Detsky note that the Court has historically tilted in favor of preserving as much legislation as possible. That makes it more likely that it will consider the Affordable Care Act separately from its mandate provisions.

If that's the case, the Administration will have a difficult time arguing that the ACA will collapse without it. If the mandate is struck down, insurers could still impose open enrollment windows or waiting periods (which would lessen the phenomenon of persons only buying insurance when they discover they are ill). In addition, the combinations of subsidies, employer penalties, Medicaid expansion and the exchanges make it much easier for consumers to buy insurance as intended.  When these are combined with weak penalties (signalling a belief that the law didn't really need a "mandate") and the pretzel legal logic of "partial severability," it would appear that the Supremes' threshold to "severing" the mandate and declaring it unconstitutional is quite low.

The DMCB shared a delicious California red with a smart lawyer last week and heard an interesting prediction: given the law's historical importance, the Justices are going to seek a strong numerical majority one way or another.  One way to do that would be to support the ACA and duck the issue of the mandate by forcing Congress to rewrite those provisions that are legally problematic. That way out for both sides may be another reason to doubt the mandate's constitutional prognosis.

Last but not least, there's always the prediction markets and public opinion. According to intrade, the individual mandate's odds of not surviving are 45%.  In the meantime, 51% of Americans believe the mandate is unconstitutional, while 53% predict it will be struck down.

More On the Affordable Care Act's Health Insurance Mandate

Is this also some type of "mandate?"

With two prior posts under its belt ("Optics" and "Furies"), the Disease Management Care Blog continues to follow the opinionating over the constitutionality of Affordable Care Act's health insurance "mandate." The latest is this New England Journal Perspectives piece.  According to author Mr. Elhauge (who personally opposes the mandate), a federal law that uses the Commerce Clause to require persons to purchase health insurance is perfectly legal and proper at multiple levels:

Congress has repeatedly used broad interpretations of the Constitution to insert itself into the conduct of commerce, so the mandate is nothing new.  One past example is the prohibition against gender, religious or racial discrimination by private firms, while another is the ban on home grown medicinal marijuana.  Since health care is a commercial activity in the public space, the logic is that Congress can similarly require anyone who has ever received health care in the past to purchase health insurance for the future.

While prohibiting an activity (like discrimination or pot) may not be the same as requiring an activity (health insurance), readers may be interested in knowing that the first Congress not only required ship owners to buy medical insurance for merchant seamen but later required seamen to buy hospital insurance.

And what about that mortgage deduction?  If you don't buy a house, you can't take the deduction, which economically the same as a penalty for not engaging in the economic activity of home ownership.

Another favorite of mandate opponents is the argument that the Feds are on a slippery slope leading to a requirement that we all buy broccoli or General Motors cars.  The counter argument is that Medicare is a system that requires the purchase of "broccoli" at government stores.  What's more, if we were to privatize Medicare, wouldn't that also functionally be a mandate for the purchase of private insurance?

Last but not least, if personal liberty is the underlying issue, the argument is that no one would ever force anyone to eat the broccoli.  Mandating insurance is not the same as mandating health care.

Will Loss Of the Individual Mandate Torpedo the Affordable Care Act?

While the Disease Management Care Blog has had more than its share of doubts about the Affordable Care Act, it ultimately agreed that the "individual health insurance mandate" may be a necessary - if perilously unconstitutional - requirement.  Conventional wisdom says that unless everyone buys into the system, healthy persons will forgo the expense of insurance. That means only the sick will pay for insurance that ultimately cannot cover the collective cost of their illness. That will lead to a rapidly escalating prices, otherwise known as a "death spiral."

And that's why, now that the mandate has been taken up by the Supreme Court, Obamacare's supporters fear that striking the mandate could unravel everything.

Which is why the DMCB found this "don't worry, be happy" analysis by Lewin Group's John Sheils and Randall Haught very interesting. They say Obamacare can still succeed without the mandate.

Based on complicated economic modeling using a mix of inputs, methods and assumptions, they found, in contrast to the widely quoted Congressional Budget Office's mix of inputs, methods and assumptions, that

1) many persons without health insurance would take advantage of the ACA's generous premium subsidies, and

2) an open enrollment window limited to one month a year would blunt the impact of persons "gaming" health insurance by only enrolling when they're sick. 

While insurance would not be universal, the Lewin authors estimate that between 21 and 24 million Americans who were previously uninsured would become insured.  While premiums could increase by 12.6%, the premium subsidies would help put the word "affordable" in the ACA. 

To further buttress their argument, they point out that in 1993 New York State required its health insurers to accept all applicants regardless of health status.  Despite many dire predictions, there was no spiral and no documented loss of coverage.

What can the DMCB conclude after reading this?  It's easy: no one really knows what is going to happen in 2014 with or without the mandate. 

It looks like there is only way to find out.

The Affordable Care Act Mandate: It Comes Down to Optics

Early in the course of the Disease Management Care Blog marriage, the spouse would target an important non-optional purchase for the DMCB spawn and tell her husband to hand over the cash. Provoked by a loss of control and a spike in circulating blood testosterone levels, the annoyed DMCB would resist. After listening to its sputtering claims that it was better suited to evaluating the merits of said purchase, the shrewd spouse relented.

After listening to very smart dueling lawyers (Simon Lazarus of the National Senior Citizens Law Center and Ilya Shapiro of CATO) at the AMA National Advocacy Conference, the DMCB decided that a key part of the debate over the individual mandate is the tangled DMCB-spouse-spawn purchasing relationship writ large.

The debate over the mandate (which, by the way, has been supported by the AMA for years) comes down to the "optics" on whether there is a difference between:

a) the spouse (government) collecting the 'hand-overed cash' (taxes) to make a purchase necessary for DMCB spawn upkeep (health care insurance),

versus

b) the DMCB (a citizen) being obliged (mandated) to spend its own cash to make the necessary spawn-upkeep purchase (health care insurance).

Supporters of the mandate point out that the Feds can use payroll taxes to force us to purchase Social Security. It can also use its taxation powers to purchase Medicare Advantage on our behalf. The only difference in the mandate scenario is that the Feds-spouse are taking themselves out of the middle. In the end, it's the same outcome.

Opponents of the mandate make an important distinction between it and taxes. While taxes are as certain as death and can be used by the spouse-government to buy anything on our behalf - examples include Fannie Mae (mortgages), GM (cars) and AIG (insurance) - it shouldn't necessarily be able to oblige DMCB-citizens to buy the stock of Fannie Mae, GM or AIG, even though that's what is happening anyway. It also can't require citizens to buy their mortgages, cars or insurance products either.

Supporters say a key distinction is that health care is unlike mortgages, cars or insurance because it's not optional. Opponents retort neither is food and shelter.

And so it goes.

The DMCB has previously examined the Affordable Care Act's (ACA) "individual responsibility" and "penalty" language (as an aside, to its knowledge, the word "mandate" never appears in the Act itself). It recalls a craven Congress wanted to avoid the political atmospherics of a "tax" while simultaneously supporting a private health insurance market. It turns out that the legislative cure may have been worse than the disease.

As an aside, during Q&A, the DMCB asked about fast-tracking the ACA-mandate legal challenges to the Supreme Court. The panel pointed out that the appeals process will allow both sides to sharpen their legal arguments, enable a better review by the Supremes and, ironically, prompt Congress to start thinking about "Plan B." Good points but, then again, they're lawyers.

By the way, as the years have passed, the DMCB just hands over the money.

The Insurance Mandate, State Legislatures, Regional Opposition and the Specter of Inviting Civil Disobedience

Adding to the the drama of health reform, the Virginia General Assembly has passed its own legislation that seeks to nullify the proposed Federal health insurance mandate. That makes this New England Journal of Medicine article on the States' prospects timely reading.

Readers won't be surprised that author Timothy Jost dismisses this as right wing-funded and politically motivated posturing. He also points out that it is also not without precedent. Past attempts to emasculate Federal law include outlawing school desegregation and decreasing access to Medicaid funding for abortion after rape and incest. Mr. Jost says this manuvering didn’t work then, and he doubts it will work now. As an aside, however, he cautions his doubt is not ironclad, because he describes an insurance mandate as “constitutionally vulnerable.” Supreme Court, here we come.

But it’s his summary of the mandate's two other downsides that make for the really interesting reading:

1. Resistance in 34 State legislatures is a telling symptom of the depth of popular opposition to health reform. While a widely followed metric is whether a national majority of Americans support or oppose the plan, the national patchwork of simultaneous disdain and support bodes poorly for the ultimate success for this piece of social legislation and the ascendant governmental activism behind it.

2. Even though the insurance mandate has enforcement provisions, they’re ultimately based on the behavioral economics of voluntary proactive compliance, jazzed up with some "or else" tax penalties - which aren't that large anyway. This good intention may run head first into what could become an open invitation to civil disobedience akin to the spectacle of the Federal enforcement of its marijuana laws. What will be the effect of passing a law that, whatever its merits, leads to an significant proportion of the U.S. population being in technical violation of that law?

The DMCB traveled on Route 81 today. On one of the overpasses, there was a group of 5 people waving to the traffic below and waving an American and the telltale Do Not Tread On Me flag.