How Obamacare Ends the Real Death Panels
For four years, "death panels" has been the GOP's killer lie in the debate over the Affordable Care Act. The slander that proposed Medicare coverage for end-of-life counseling constituted a government "death panel" that would "pull the plug on grandma" was Politifact's 2009 Lie of the Year. Then what Sarah Palin dubbed a "metaphor" for the "government takeover of health care" (Politifact's 2010 Lie of the Year) shifted to the Independent Payment Advisory Board (IPAB), the committee designed to control costs and encourage best practices for Medicare. But with the launch of IPAB delayed past 2015 because slowing Medicare cost growth has not hit the legislatively-mandated trigger, the toxic "death panels" virus had gone dormant.
Dormant, that is, until about two weeks ago. Word that 10-year old end-stage cystic fibrosis patient Sarah Murnaghan did not qualify for an adult lung transplant under expert guidelines implemented in 2005 prompted right-wingers to resurrect the Obamacare Death Panels fraud. The sad irony, of course, is that next year the Affordable Care Act puts an end to the real death panels. That is, starting in 2014 Obamacare will halt the worst abuses of private insurers, whose refusal to cover those with pre-existing conditions; cruel "rescission" of policyholders who become sick and caps on lifetime benefits have produced financial disaster (and sometimes death) for hundreds of thousands of Americans. And that means the only ones pulling the plug on anyone are the Republican governors and GOP state legislatures rejecting the Medicaid expansion which will leave millions of their residents uninsured.
Nevertheless, on Monday the National Review ("Sarah Murnaghan and the Death Panel") suggested that HHS Secretary Kathleen Sebelius' refusal to override the transplant policies developed over several years by the Organ Procurement and Transplantation Network made her Obamacare's executioner-in-chief:
So why did Sebelius refuse to make an exception or create a new policy, both well within her powers? I wish the answer were an isolated display of poor judgment, but it points instead to the flaws at the heart of Obamacare, where arbitrary bureaucratic rulings and archaic regulations will take the place of independent, case-by-case judgments by informed, caring physicians.
Some kind of rationing is inevitable with scarce medical resources, but with death-panel Sebelius in charge, patients who need care the most, such as Sarah, may not be the ones to receive it.
As the New York Times explained in 2006 ("Lung Patients See a New Era of Transplants"), the chronic shortage of hearts, livers, kidneys and lungs mean that hundreds of very ill Americans face death each year as physicians make the painful trade-offs expert medical bodies help balance.
But private insurers have only bottom lines. Which, as we learned in the run-up to the passage of the Affordable Care Act, is why they have body counts as well.
One recent survey found that nationwide 22 percent of Americans trying to purchase health insurance in the individual market were rejected. And as Ezra Klein detailed back in 2009, the industry's practice of "purging," in which "insurers rid themselves of unprofitable accounts by slapping them with 'intentionally unrealistic rate increases'" forces companies and individuals alike to drop their policies.
But the insurers' most cruel and vicious practice, one eliminated by Obamacare, is "rescission." As the Los Angeles Times documented in horrifying detail beginning in 2006 ("Sick but Insured? Think Again"), insurance companies use the rescission process to drop subscribers who become ill, often falsely claiming they suffered from a pre-existing condition or committed fraud to obtain coverage in the first place.
Aside from appealing to the company that dumped them, subscribers' only recourse is to complain to state regulators or sue. After an insurer yanks coverage, it can be difficult, if not impossible, to get a policy from another carrier.
Health plans encourage applicants they reject and policyholders they cancel to apply to a state-subsidized insurance fund for patients with high-cost or chronic conditions. But the wait can be long. Lacking coverage, patients often have to pay cash upfront or go without care...
Outside the companies, no one tracks how often insurers cancel policies. Blue Cross, which has the biggest share of the California market, won't say. But an employee said in a deposition last year that a special department considers as many as 1,500 cases for cancellation each week in California alone. A consumer lawyer who saw Blue Cross' cancellation tally sheets described the department as a rescission factory.
At a Congressional hearing on June 16, 2009, Americans got a much fuller picture of how those rescission factories actually work. As it turned, the major insurers maintained lists of up to 2,000 conditions which they used to automatically trigger an investigation into possible grounds for rescission. As Newsweek recounted:
The commerce-committee investigation released the first public data on the practice, finding that the three companies, WellPoint, UnitedHealth, and Assurant, rescinded nearly 20,000 policies from 2003 to 2007, saving $300 million. The committee found that at WellPoint, employees were rewarded for rescinding policies based on how much money they saved the company.
Other insurers also offered employees incentives for taking an axe to the current policyholders whose mistake was to get sick. As Time noted, "one Blue Cross employee earned a perfect score of '5' for 'exceptional performance' on an evaluation that noted the employee's role in dropping thousands of policyholders and avoiding nearly $10 million worth of medical care."
The impact on patients is staggering. As NPR summed up one horror story, "Just a few days before her scheduled mastectomy, Robin Beaton's insurance company retroactively canceled her policy because she had failed to inform them of her history of acne and a rapid heartbeat." Similarly, when Otto Raddatz was diagnosed with lymphoma, "his health insurer rescinded his policy because of a pre-existing condition he was not aware of."
As the Los Angeles Times detailed, when lawmakers asked executives from the three firms if they would stop dropping customers except where they can show "intentional fraud," all said no:
Late in the hearing, [Bart] Stupak [D-MI], the committee chairman, put the executives on the spot. Stupak asked each of them whether he would at least commit his company to immediately stop rescissions except where they could show "intentional fraud."
The answer from all three executives:
In March 2010, Congress passed and President Obama signed the Patient Protection and Affordable Care Act. Starting in September 2010, tough new national standards dramatically altered rescission, only allowing insurers to drop coverage only in cases where a patient has committed fraud or intentional misrepresentation. As with the requirement that insurance companies allow parents to add children 26 or younger to their policies, many firms began their compliance early.
But that doesn't mean that some Americans won't needlessly die and thousands more won't be bankrupted after Obamacare is fully implemented. Because while almost 30 million people will gain insurance as a result of the ACA, millions more won't simply because obstructionist, grandstanding Republicans are refusing the expansion of Medicaid in their states. A recent analysis shows that 1.9 million Texans, 1.1 million Floridians and 300,000 Louisianans will be left uncovered.
And we already know what happens when the real Republican death panelists start playing politics. When Arizona Governor Jan Brewer slashed funding for her state's Medicaid program in 2010, 98 previously covered patients awaiting transplants faced the prospect of certain death. While funding was later restored, it came too late for two people who died in the interim. Among them was Mark Price, a father of six. End-stage cystic fibrosis sufferer Tiffany Tate was lucky, but only because after an anonymous donor came forward to pay the $277,000 cost of her surgery and the Arizona legislature restored funding for the hundreds of thousands of dollars of post-op care she'll need for the rest of her life.
That doesn't just explain why Tiffany Tate is no fan of Jan Brewer. It also accounts for that fact that Brewer has decided to accept the Medicaid expansion for Arizona.
After all, she knows what it's like to be a real death panelist.