interviews
Insurance Coverage Design
by Naomi Zewde
September 24, 2020
This interview with Naomi Zewde, an Assistant Professor in the Graduate School of Public Health & Health Policy at the City University of New York, and a research fellow at the Roosevelt Institute, was conducted and condensed by franknews.
Naomi | I focus on health insurance coverage and the economic and financial implications of insurance coverage design. I look at how these things affect household financial wellbeing.
franknews | We know that medical debt is rising. What is happening in the healthcare system that explains the increase?
The issue of consumer debt in general in America is almost like a slow fire.
If people don't have the resources to meet their basic needs healthcare, education, housing — these fundamental things end up being sources of debt.
In healthcare, people’s deductibles are growing at incredibly fast rates; deductibles are growing much faster than premiums, and certainly much faster than wages over the past decade. People are left exposed to a greater share of their medical expenses, and exposed to huge medical bills — typically more than what most people have in their savings. That creates a lot of stress and fear, and often the threat of that financial burden deters people from seeking care.
What drives the prices of care up?
We don’t know.
The United States spends more on healthcare, both in dollars and in percent of GDP, than any other OECD country, but it is not clear exactly what we are spending that on.
We have a lower life expectancy. We have fewer physician visits per capita. We have a higher rate of chronic conditions. Those who provide healthcare - physicians, nurses - are not necessarily reaping the benefits either. We know that the utilization rate of the healthcare system is not unique to the United States. So why are the prices so high? That is up for debate.
We do know a few things. One, we know that a lot of this money goes towards the vast administrative bureaucracy — something that is unique to the United States. We also know that the government in other countries set prices: they either operate as the sole purchaser and thus dictate prices or they dictate prices through legislation. In the United States, Medicaid has price controls, but private insurers can charge whatever they want. There is no real way for anyone to fight back. There's no designated person to say no, you're charging too much.
Based on your research, what effect does this have on households’ finances?
I have done work around housing evictions and medical debt. We found that Medicaid expansion reduces the rate of home eviction. Going into the research it was not necessarily clear what relationship the two would have, if any. It sounded plausible — people with chronic conditions, for example, end up having to choose between rent and care. But it is astounding to think about the fact that the design of our healthcare system can have these ramifications.
I also found, in a paper that came out last month, that for 25 percent of people who were uninsured before ACA, it's cheaper to file for bankruptcy than to reach a deductible of the subsidized ACA private insurance policy.
Wow.
It’s surprising right! But it makes sense and might explain why there is such low participation in ACA private insurance policies. The congressional budget office projected that 10 million more people would enroll in these plans than actually did; only 8 million people got these. They were way off. The paper investigates why.
And what did you find?
I suspected from the beginning that it was because the deductibles are so high. The median deductible for the silver tier coverage is $4,000. There is a sweet spot in terms of the subsidies that substantially lower your deductible and premium. If you make between $12,000 and $18,000 a year, subsidies will bring down the deductible to around $200. But once you make $24,000 a year as a single adult, you're facing between a deductible between $3,000 and $4,000. So in designing the policy, it was kind of like, we will give extra subsidies to lower-income households, but not in a way that reflects what it is actually it's like to live with these medical bills. It feels divorced from reality.
Our findings don’t necessarily mean the people have to declare bankruptcy. Bankruptcy sucks and hospitals also know that when you file for bankruptcy, they typically do not get anything out of it. So, they look to work with you. Neil Mahoney has a paper, Bankruptcy as Implicit Insurance, that essentially shows that hospitals tend to settle with consumers at their cost of filing for bankruptcy. Hospitals essentially say, whatever you were going to lose if you were to file for bankruptcy, just give that money to us instead.
That reminds me of what Deborah Thorne said in our interview with her: "As Americans, we often rely on credit cards to be our social safety net. And when that falls apart, we are left with bankruptcy.” What is your understanding of how we got to this place?
It's tied up with a social-political larger trend. I have been watching this show called the Black Journal from 1968 to 1977 with a bunch of progressive Black scholars.
I watched one that was right after Nixon got elected, and everyone was saying, "America is taking a turn towards facism. All of American’s white guilt money is gone.” I think that really well foretold this mass acculturation that happened under Nixon.
The United States is not unique in this march away from social egalitarianism over the last half of the 20th century, but we are living through the consequences.
How do we return protections?
There is this famous paper - It’s the Prices, Stupid. I think there needs to be some kind of direct effect on price.
You mentioned the government can do so by either acting as the sole buyer of care or passing legislation. What do you think is the best way to achieve fair prices?
Right. One way of doing so is through a single-payer system. I am actually working on a study now that is going to be published to the Roosevelt Institute that compares single-payer with a public option.
There are two things to know about single-payer that are useful in this context.
One, it would get rid of most of the bureaucracy involved in negotiating prices — the different insurance companies, the different kinds of billing, and different plans. Right now, every doctor's office has multiple people whose full-time job is to understand how to interact with every single different plan of every different insurance company. There are many people employed on the side of the insurance company as well. Under a single-payer system, that would be gone. There wouldn't be multiple different rules to understand, and that reduces the aggregate resource use that is allocated towards healthcare.
Two, a single-payer system is tax-financed. That is important in terms of equity. You get to decide what percentage of household income should be allocated towards healthcare. Basically, the way our healthcare system is designed now means that the more money you make, the smaller percentage of it you have to put towards healthcare.
It is regressive, and no one has a choice but to participate in it.
If we structure it as a tax-financed healthcare system, the way we fund most of our infrastructure, you just get to decide what percentage of household income you are going to take from each household along the income distribution.
interviews
Call It What It Is
by LaShyra Nolen
July 1, 2020
This interview with LaShyra Nolen, Harvard medical student, and the first Black woman to become class president, was conducted and condensed by franknews.
frank | You've written and spoken about your experience within a dual reality – of being both a medical student at Harvard, and a person committed to your own identity and equity.
LN | The dual reality is you're training at the best medical school in the world, but there is so much suffering going on in your community. And whatever knowledge you gain still isn't going to necessarily translate to the improvement of the condition of Black people. For example, I could go on to become the best surgeon in the world. I could save the life of a Black patient. But they can go outside, drive home, get stopped by a police officer, move too fast, and get killed.
You always have to think about it from both of those perspectives, that of a student and that of a Black person in America.
In addition, you go into class and you are expected to maintain professionalism. You are expected to just talk about the science and to talk about the assignment at hand – when that same morning you watched yet another police lynching of a Black man. You're trying to deal with those emotions, and you have no idea how it's going to be taken if you say, "Hey guys, I'm really not doing that well. Another Black man was killed. Racism is pervasive in our country and we're all complicit in it." It is a challenge that all Black professionals have. You have to walk in and put on this face, even though internally you are dealing with the turmoil and hurt of your community.
What does this moment feel like at Harvard, as a student?
As a medical student, I feel like I can speak out more than my mentors or faculty members who are more ingrained into the system of medicine. Academic medicine is very hierarchical. The higher up you go, the more you have your hands tied, and you can't speak as much truth because you're trying to move up to an associate professor position so that you can finally start to use your voice. I know that there's a risk that comes with speaking up, but I, personally, can no longer just pretend like everything's okay, and allow people to continue to suffer in silence. Even the most brilliant people have been complicit in racism, and some of them genuinely have never even thought about it.
They've grown up in a bubble, their entire lives, and all this is happening and they're just like,
These brilliant people who are excellent in their field, are just now realizing they're complicit in this system.
Again, I am happy that's occurring, but I'm always just like, look how much it took for us to get here. NASCAR is just now removing the Confederate flag. Suddenly now I have Juneteenth popping up on my Google calendar. I'm like, what?
My classmates and professors have really been amazing actually. We are all from different backgrounds. Some are fourth-generation physicians, and some grew up on reservations and are bringing medicine to indigenous folks. All of them realize that the system needs to change, and they have been so supportive. Beyond just talking the talk and posting the black box on Instagram, they've been reaching out to me saying, “Here are the notes from class today. I got this recording for you because I know you've been putting in work on the advocacy front.” That's true allyship to me. I've really been pleasantly surprised and happy to see the support that I've gotten from my classmates.
There has been a widespread acknowledgment that COVID is affecting communities and people of color at much higher rates. I am curious if you think there has been an appropriate conversation around why that’s the case?
I think that in order to understand that we have to look at our history, and at policy. The original ill was, of course, chattel slavery. This country has not valued Black lives. The policy reflects that, and policy ties into our healthcare. That history of systemic discrimination is important to look at to examine the current landscape of COVID-19.
Redlining decided where people live in this country, and which communities our government and our local city councils were going to invest in. Black communities were not invested in. As a result, Black communities have not had access to the basic resources that they need to survive and thrive. They don't have access to healthy food. They don't have access to safe places to exercise. They are exposed to environmental pollution. They have less access to education. I mean, then you look at who is more likely to be an essential worker - Black people are overrepresented.
It doesn't end there. Once people get into the clinic, they have to deal with the biases and systemic racism in the hospital system. There are studies that have shown there are medical students and residents who still think that Black people have a higher pain tolerance.
We can take maternal mortality as an example of treatment differences. Black women, at all income levels, are dying disproportionately compared to white women. When they get to the hospital, doctors don’t believe their pain. I mean, it happened to Serena Williams. It is safer for Black women to not engage with the healthcare system because of the violence and harm it causes.
How do you think mistrust of the medical system compounded the COVID crisis?
I think it all comes back to this conversation of access, right? When COVID-19 first hit, the testing centers were predominantly located in affluent communities, and a lot of Black communities were left without access to testing. The lack of Black physicians and Black health care professionals means that when Black patients come in and say they have COVID-19 symptoms, they are less likely to get treatment compared to white people.
If you know there are no testing centers in your neighborhood, you know there is no representation in the hospital, and you know that you are going to be discriminated against once you walk in that door, you know your life is being devalued. That knowledge prevents Black people from seeking care from our healthcare system. With anecdotes of horror coming from your community, of course you are going to be nervous to trust the healthcare system.
What does a better understanding of investment into public health look like to you?
I think we need to turn all of the conversations that we've been having into public health initiatives. Racism was declared a public health emergency in Boston. That is the direction I think we should be moving in.
We need to move beyond equality to think about equity. We need to recognize that not everyone is on the same playing field. We need to truly make sure everyone's specific situation is taken into consideration. We do that by investing in those communities, and by looking at how we make sure they have access to good education, access to health care, access to housing, access to good food. Improving the conditions where people live, work, pray, play will improve their healthcare outcomes and our healthcare system.
Of course, we need things like the physical exam, but often patients go into that physical exam with preexisting chronic diseases caused by disparate suffering. Going as upstream as possible will lead to better healthcare outcomes and in the long run, improve healthcare costs. Even if investing in public health didn't improve healthcare costs, I still think that it's the moral thing to do. I think we're too driven by what's going to save money in our country. We need to do what's right.
Someone said to me once, we’re too focused on raising the ceiling and not at all focused on raising the floor in the American healthcare system. Do you feel like this starts as a medical student?
I can definitely speak to that culture. As a medical student, I'm really passionate about community activism. I am passionate about making sure that everyone has access to healthcare, and ensuring that we're teaching medical students anti-racism so that they don't go out and further harm communities. I can spend two years doing that – serving on committees, writing up reports, and changing curriculum at my institution. But my peers who are spending the same time publishing papers on very specific proteins and disease processes might have a better chance at residency.
It has been the responsibility of Black students, students of color, and indigenous folks to improve their institution. They do the work so that they can thrive and survive, and so the next generation can do the same. But at the same time, they still have to do everything they have to do as a medical student to get to the next level. I'm literally trying to improve the very environment that I'm suffocating in, while also trying to handle everything else that medical students are expected to.
There was a letter early on from public health officials advocating for protest as it’s needed to fight racism within the healthcare system. Does that feel new or was it already a part of the conversation?
I think it's always been a part of the conversation for those who have been oppressed.
But that is what is special about this moment. We literally had a global pandemic that exposed the disparate suffering of Black people across the country, across the globe. And then on top of that, you have back to back to back killings of Black people. It's heartbreaking that it took this much for us to start having these conversations, but we are having them, and people can’t run away from them.
We need to say Ahmaud Arbery. We need to say Breonna Taylor. We need to say their names, and we need to name the issue at large.
Big-name organizations are just finally starting to realize that this is something that they need to get on board with. It’s hard to know if it's really genuine or not. I think that people don't want to be on the wrong side of history. Regardless, learning is still happening. I'm very happy that anti-racism is becoming the status quo and that we are having these conversations. We need to continue to push the envelope to get people things they need to live a good life.