Term Paper on "Economic and Constitutional Issues Surrounding Health Insurance Mandate for All American Citizens"

Quoted Instructions for "Economic and Constitutional Issues Surrounding Health Insurance Mandate for All American Citizens" Assignment:

Imagine you work for a particular health or health care-related interest group. You want to attract the attention of specific policymakers (legislators or regulatory bodies), or other health care leaders, that are key to changing some policy that will better your cause. Knowing that their time is valuable, and their attention spans are short, try to formulate a memo to catalyze action. You will find examples of concise policy memos within the websites of scores of interest groups. You must choose the format, which you feel is the most effective.

Students are to write a 3 page letter/statement (single-spaced) that could be used to influence a legislator/regulatory body or health system leader on a specific issue that would be of particular interest for your group.

The letter should:

ü Present a clear discussion of the scope of the issue/problem

ü Offer a concise history of the issue

ü Inform the legislator/regulator/health care leader why the issue/legislation/regulation is important to your particular interest group, or individuals/groups like yours

ü Clearly present the pros/cons of a policy swinging in a particular direction

ü Explain why a legislator/regulatory body/health care leader should respond in a specific manner. Specifically state why this issue should be important to them

SAMPLE PAPER

Ethical and Financial Issues Surrounding Medical Bankruptcies

Introduction

On October 20, 2009, the Senate Judiciary Administrative Oversight and the Courts Subcommittee held a hearing on medical bankruptcies, which illustrated two, different views on this issue. On the one hand, the Democrats and their supporters contended that the government needed to alter the bankruptcy regulations to make it easier for individuals with significant medical debt to file for Chapter 7 protection; this group also supported a bill that would allow these debtors to keep their homes. The conservatives countered by stating that any changes in these laws would increase consumer malfeasance and harm the economy. Both parties***** arguments were mediated by larger economic and social justice issues. My paper will explore this topic further by looking at recent literature and legislative initiatives surrounding this issue as well as by assaying the Judiciary Subcommittee hearing.

Literature Review

Most of the men and women, who participated in the Judiciary Subcommittee hearing, conflated issues confronting medical debtors in general with problems specific to the portion of that group which filed for bankruptcy protection. As a result, I will provide a brief analysis of some of the recent scholarly literature on these subjects in order to help readers better understand a few of the important themes which permeated the hearing.

Over the past few years, researchers have produced numerous, scholarly articles which deal with the issue of medical debt. Some of the most popular of these essays share several, key hypotheses. First, they argue that a large number of Americans, perhaps as many as *****¦72 million people*****¦[have] problems with payment of medical bills, accrued debt, or both.***** Many of these individuals owe thousands of dollars in medical expenses. The *****s go on to assert that the men and women who accrue these debts are, by and large, productive, responsible citizens rather than malcontents or slackers; these individuals run into financial difficulties as a result of economic or health issues that are beyond their control. Perhaps most importantly, the authors attempt to demonstrate that many of these people have trouble getting access to medical equipment or forgo seeking treatment for ailments due to their medical debts.

Researchers utilize the same arguments when discussing the portion of this debtor group that decides to file for bankruptcy. For instance, they contend that these people are, by and large, productive, responsible citizens. ***** Himmelstein, whose most recent essays were mentioned by several of the witnesses at the Judicial Committee hearing, adds to this discussion by asserting that medical debt accounted for *****¦62.1% of all bankruptcies in 2007.***** Perhaps most importantly, he also contends that a large number of these people have difficulties finding jobs and *****¦paying their bills*****¦***** even after declaring bankruptcy. This fact might indicate that these people still have unresolved issues arising from their medical debt (or perhaps from chronic illnesses).

I was not able to find any recent, scholarly articles that adhere to opposite viewpoints with regards to individuals who have medical debt but are still solvent. However, I did locate essays that assert that most people do not declare bankruptcy to eliminate their unpaid medical bills. Rather, according to these authors, the vast majority of these men and women file for bankruptcy because they have amassed unrelated credit card debt or other non-medical expenses. While these researchers might have valid arguments, I do not delve into this topic in any depth in this paper.

Government Legislation

In 2005, the Republicans were still in control of the White House and the Congress; in April of that year, they managed to push through a key piece of bankruptcy legislation, the Bankruptcy Abuse, Prevention, and Consumer Protection Act of 2005. It represented a compromise between the various stakeholders; therefore, it did include some important sections on consumer protection and other issues important to liberals. At the same time, the legislation made it more difficult for people, including those individuals with medical debts, to file for Chapter 7 bankruptcy protection. The bill also forced these petitioners to receive debt management counseling before they could officially declare bankruptcy.

Perhaps in response to the 2005 act, the Democrats proposed three separate bills between 2008 and 2009, which aimed to, among other things, make it easier for medical debtors to file for Chapter 7 bankruptcy protection. The first of these legislative documents, proposed by a Democratic House member in early 2008, failed to make it out of committee. The liberals might be more successful with the next two bills they sponsored, as these documents are still being debated in their respective committees. The Senate bill, the Medical Bankruptcy Fairness Act of 2009, is the one discussed by the Judiciary Subcommittee. It mandates waiving the counseling requirement implemented by the 2005 act, and it also allows people to file for Chapter 7 bankruptcy but still retain their home if it is valued at $250,000 or less. Additionally, the legislation makes it easier for these men and women to liquidate all of their debts via bankruptcy.

The Judicial Subcommittee Hearing

On October 20, 2009, *****¦[t]he Senate Judiciary Administrative Oversight and the Courts Subcommittee held a hearing on proposed legislation to change current U.S. bankruptcy laws to reduce the number of people filing for bankruptcy because of medical debt.***** Sheldon Whitehouse, a Democratic Senator from Rhode Island, chaired the conference. He was joined at this meeting by fellow Democratic Senators, Russell Feingold of Wisconsin and Al Franken of Minnesota. Jeff Sessions, a Senator from Alabama, was the only Republican congressman to attend the hearing. These individuals listened to testimony from two proponents of the bill, Elizabeth Edwards, Senior Fellow at the Center for American Progress, and John Pottow, a law professor at the University of Michigan. The senators also heard from two people opposed to the legislation, Aparna Mathur, a research fellow at the American Enterprise Institute, and Diana Furchtgott-Roth, a senior fellow at the Hudson Institute and a prior chief economist at the U.S. Department of Labor. The senators also listened to testimony from Kerry Burns, who, along with her husband, had to file for medical bankruptcy due to her son*****s illness.

The chair started the conference with some opening statements; he then let each of the witnesses speak. After that part was over, the senators took turns querying their guests. These individuals***** particular statements are not as important as the general themes that were espoused by the proponents and opponents of the legislation.

The Democrats and their supporters assert that a large percentage of people who file for bankruptcy do so in order to eliminate medical debts. They also contend that these individuals are, by and large, hardworking citizens who can no longer afford to pay for the hospital and doctor bills that they or their loved ones have incurred. Following on this hypothesis, the liberals advocate for waiving the counseling requirements for individuals who declare medical bankruptcy, as they claim it is both an unnecessary and humiliating process. The senators and their supporters use some of the same logic to support their calls for a waiver of the means test.

The Democratic senators and the other proponents of the Medical Bankruptcy Fairness Act argue that the federal government should waive the means testing requirements for people filing Chapter 7 bankruptcy as a result of medical debts. The proponents of the bill also suggest allowing these individuals to keep up to $250,000 of equity in a house. They suggest these things in part because they believe that these Americans are generally hard working, responsible people who should not be punished for getting sick. They also point to figures linking medical debt and limited healthcare access and outcomes. In other words, they proclaim that sick individuals, who are filing for bankruptcy, will not be able to obtain quality healthcare if they have no equity or if they have to pay back a part of the debt via Chapter 13 adjudication.

The supporters of bankruptcy legislation utilized Kerry Burns***** testimony to help them provide listeners with an experiential example to support their hypotheses. She represented the hardworking, model citizen who had to file for bankruptcy because of the costs associated with her child*****s 13 month hospitalization. Her story succeeded in its goal of providing an emotional base for the otherwise dry, fact based testimony from Edwards, Pottow, and the Democratic senators.

The opponents of this legislation argued against changing the current laws for several reasons. First, they asserted that at least 80% of people who file for medical bankruptcy can enter a Chapter 7 plea. Second, they argued that some Americans will try to cheat the system if the Medical Bankruptcy Fairness Act passes. Finally, the opponents of the bill contended that healthcare costs will go up if everyone who files for medical bankruptcy is allowed to liquidate all of their debts instead of entering into Chapter 13.

The opponents of the Medical Bankruptcy Fairness Act are not as successful in supporting their hypotheses for two, key reasons. First, their analysis of the situation is dichotomous; if most people with medical debt can file for Chapter 7 bankruptcy, why would it harm the economy to allow a few more people to do it. Second, one of their witnesses, Diana Furchgott-Roth, came to the meeting unprepared to discuss the issue of medical bankruptcies; rather, she focused all of her ire on the general issue of healthcare reform.

Reflections

The issues revolving around medical bankruptcies are complex. For one thing, it is difficult if not impossible at this time to assay how severe the problem is and what impacts the solutions, posited in the Medical Bankruptcy Fairness Act of 2009, will have on debtors as well as on the overall market. The opponents of this legislation might be correct when they state that the economy will suffer if the bill is enacted into law. On the other hand, it might increase productivity by improving the health outcomes for some of these individuals. At this time, I do not feel that researchers have enough data to make this decision. Nonetheless, I feel that the government should strongly consider implementing this legislation.

While it might be difficult to posit a solid utilitarian argument in support of the Medical Bankruptcy Fairness Act given the dearth of available information on outcomes, I still think America should pass the legislation. In the United States, we espouse notions of fairness and justice, which are based on meritocratic ideals. Inspired by this philosophical model, we often criticize individuals who do not earn a living. As an example, many Americans oppose steroid use by athletes because they believe that it gives them an unfair advantage on the playing field. However, if we want to remain true to these tenets, we should allow people to eliminate debts which they do not incur through any fault of their own.

Doty, ***** M., Collins, Sara R., Rustgi, Sheila D., and Kriss L. Jennifer. *****Seeing Red: The Growing Burden of Medical Bills and Debt Faced by U.S. Families,***** Commonwealth Fund 1164, vol. 42 (August 2008): 1, Retrieved from: http://www.commonwealthfund.org/~/media/Files/Publications/Issue%20Brief/2008/Aug/Seeing%20Red%20%20The%20Growing%20Burden%20of%20Medical%20Bills%20and%20Debt%20Faced%20by%20U%20S%20%20Families/Doty_seeingred_1164_ib%20pdf.pdf

Also see Doty et al. 2, 3.

Also see Jha, Shweta, *****Study: More than 57 Million Americans Had Medical Debt in 2007.***** Commonwealth Fund, September 24, 2008. Retrieved from: http://www.commonwealthfund.org/Content/Newsletters/Washington-Health-Policy-in-Review/2008/Sep/Washington-Health-Policy-Week-in-Review---September-29--2008/Study--More-than-57-Million-Americans-Had-Medical-Debt-in-2007.aspx?view=print.

Also see Seifert, Robert W. and Rukavina, Mark, *****Bankruptcy is the Tip of a Medical-Debt Iceberg,***** Health Affairs 25(2): 89-90. Retrieved from: http://healthaff.highwire.org/cgi/reprint/25/2/w89.

Jha (2008).

Doty, 2,4; Seifert, 91.

Doty 3-4; Seifert, 91

Seifert, 89-90; Himmelstein, ***** U., Thorne, Deborah, and Warren, Elizabeth, Woolhandler, Steffie,***** Medical Bankruptcy in the United States, 2007: Results of a National Study,***** The American Journal of Medicine xx, x (2009): 3-5, Retrieved from: http://www.pnhp.org/new_bankruptcy_study/Bankruptcy-2009.pdf.

Himmelstein et. al, 1. Also see Himmelstein, ***** U., Warren, Elizabeth, Thorne, Deborah, and Woolhandler, Steffie, *****Illness and Injury as Contributors to Bankruptcy,***** Health Affairs (web exclusive article): 63-64, Retrieved from: http://content.healthaffairs.org/cgi/reprint/hlthaff.w5.63v1.

Himmelstein et al., *****Illness and Injury,***** 68-69.

*****Bankruptcy and Medical Debt; Senate Committee Judiciary|Administrative Oversight and the Courts***** C-Span (October 2009) http://www.c-spanvideo.org/program/289547-1. Elizabeth Edwards and others espouse this argument.

Scott III, Robert H., *****Bankruptcy Abuse Prevention and Consumer Protection Act of 2005: How Credit Card Industry*****s Perseverance Paid Off,***** Journal of Economic Issues, XLI, No. 4 (December 2007): 951, Retrieved from:

http://bluehawk.monmouth.edu/~rscott/articles/Scott-JEI%20Bankruptcy.pdf.

Also See Dranova, ***** and Millenson, Michael L., *****Medical Bankruptcy: Myth Versus Fact,***** Health Affairs 25, vol. 2: 75. Retrieved from: http://healthaff.highwire.org/cgi/reprint/25/2/w74.

Govtrack.us website, Retrieved from: http://www.govtrack.us/congress/billsearch.xpd. The information not taken from the Govtrack site is common knowledge.

C-span

Ibid; Scott III, 951; Himmelstein et al. 1.

C-span.

SAMPLE 2

On October 20, 2009 the Kaiser Family Foundation held a briefing and panel discussion on the Community Living Assistance Services and Supports (CLASS) Act. The CLASS Act, introduced for the first time in 2004 by Senator Edward Kennedy and included in the House and Senate Health Education Labor and Pensions (HELP) Committee health reform bills (S.1679 / H.R.3962), would create a national voluntary insurance program for individuals who are functionally impaired (Kaiser, 2009).

According to supporters of the provision, the daily cash benefit provided by the CLASS Act would allow individuals with functional impairments to remain in their homes and gain access to the long-term supports and services that would enable many of them to remain working members of their communities. And, because the CLASS Act is not a poverty-based model, it would allow individuals to retain their assets and stay off of Medicaid (Kaiser, 2009).

In 2005, approximately 10 million people in the United States needed long-term supports and services to help with activities of daily living such as dressing, bathing and toileting (Houser, 2007). Unfortunately, even though approximately two-thirds of Americans will need long-term care at some point in their lives, many hold misconceptions about disabled populations (Georgetown, 2003). For example, most Americans believe that only older individuals require long-term care when in fact about 40 percent are less than 65 years of age (Kaiser Health Poll, 2005).

Americans are also misinformed about the means by which most long-term services and supports are funded. Approximately 30 percent believe that private insurance will be a primary funding source for their long-term care needs and 13 percent believe Medicare or Medicaid will be a primary funding source (Kaiser Health Poll, 2007). Today, the Medicaid program is the primary funding source for long-term care expenditures (40 percent), followed by Medicare (23 percent), out-of-pocket expenditures (22 percent), and private insurance (9 percent) (Houser, 2007). Medicare*****which approximately 30 percent of individuals believe is the primary government source of funding for low-income individuals*****will only pay for long-term services and supports immediately following a stay in an acute care hospital (Kaiser Health Poll, 2007).

Many researchers and advocates for the elderly and the disabled argue that there are numerous problems with relying on Medicaid as the primary financing mechanism for long-term care. Because Medicaid has strict income eligibility requirements it requires individuals to *****spend down***** their assets to near poverty before they qualify for benefits (O*****Brien, 2004). And, because the Medicaid program is financed through a partnership between the federal and state governments, state Medicaid expenditures for the elderly and disabled are taking up increasingly large proportions of the state Medicaid budget, forcing states to limit provider payments and restrict benefits for the larger Medicaid population, to include low-income women and children. In response to budget pressures, many states have opted to limit Medicaid payments to long-term care providers (O*****Brien, 2004). Recent studies have shown that these low provider payments create access problems for beneficiaries and quality problems in nursing homes (O*****Brien, 2004). Finally, and importantly, federal and state Medicaid laws are structured such that individuals are often forced to receive care in an institutional setting, such as a nursing home, even when they would rather remain in their homes (O*****Brien, 2004).

The issue of major long-term care reform, much like the issue of larger health care reform, was last on the national stage in the early 1990s. In September of 1990, the US Bipartisan Commission on Comprehensive Health Care*****the Pepper Commission*****issued a call for action that included reform of the long-term care system (Rockefeller, 1991). Unfortunately, like health reform, long-term care reform did not materialize. As noted above, however, the House and HELP Committee health reform bills currently include the CLASS Act (Thomas, S.1679 / H.R.3962). The Senate Finance Committee bill, which is expected to be merged with the HELP bill early next week, does not. The Senate Finance Committee bill does, however, include some important Medicaid reform provisions that will help reduce the institutional bias in Medicaid long-term care funding and will allow more people to receive long-term supports and services in their homes. The question remains as to whether or not the CLASS Act and the Medicaid provisions will be included in the final merged Senate health reform bill.

The Kaiser Family Foundation CLASS Act briefing appears to have been organized in an effort to elevate public awareness of the provision in the health reform bills and to mobilize public support for the provision in the merged Senate bill. The panel members included:

*****¢ Judy Feder, Professor of Public Policy at Georgetown University and Senior Fellow at the Center for American Progress

*****¢ Connie Garner, Policy Director for Disability and Special Populations for the late Senator Edward M. Kennedy

*****¢ Paul N. Van de Water, Senior Fellow at the Center on Budget and Policy Priorities

*****¢ Richard G. Frank, Deputy Assistant Secretary for Planning and Evaluation and Director the HHS office on Disability Aging and Long-Term Care Policy

*****¢ Nora Super, Director of Federal Government Relations for Health and Long-Term Care at AARP

*****¢ Larry Minnix, President and CEO of the American Association of Homes and Services for the Aging

*****¢ Marty Ford, Director of Legal Advocacy for The Arc and UCP Disability Policy Collaboration

Unfortunately, the panel did not include representatives in opposition to the CLASS Act, so in an effort to provide a balanced report, this memo will include some discussion of the opposing views reported in the press. The primary opposition to the CLASS Act is the private long-term care insurance industry. Although the CLASS Act is intended to work in conjunction with wrap around private insurance coverage, insurers are concerned that the program will produce the perception that long-term care insurance coverage is no longer needed. The private long-term care insurance industry has a continuing problem with market penetration; currently, only about 20 percent of Americans hold a long-term care insurance policy (Kaiser Health Poll, 2007).

Congressional opponents of the CLASS Act argue that the provision is not fiscally and actuarially sound; that it produces an unfunded mandate on employers who must administrate the payroll deductions; and that the benefit provided by the CLASS Act is not nearly enough to warrant the risk of establishing an entirely new federal entitlement program. Unfortunately, several of the Members of Congress who are opposed to the CLASS Act are powerful members of the Senate Finance Committee, making the chances of the provision in the final merged Senate bill far less likely. For example, Senator Kent Conrad was recently quoted in an Inside Health Policy article calling the CLASS Act a *****Ponzi scheme.***** In addition, seven fiscally conservative Senators, including Senators Blanche Lincoln and Ben Nelson, recently sent a letter to Senator Reid asking that the CLASS Act not be included in the final version of the Senate bill.

At the Kaiser briefing, each of the individuals on the panel offered his or her perspective on the need for the CLASS Act, as well as a rebuttal to the various reasons for opposition to the program. Most noted that the Congressional Budget Office estimates the CLASS Act will reduce the budget deficit by $74 billion over a ten-year period. Connie Garner also commented on an amendment to the CLASS Act made by Senator Gregg that would require the Secretary of the Department of Health and Human Services to adjust premiums as necessary in order to ensure the program remains actuarially sound over a 75 year period. Richard Frank announced that his office has modeled the CLASS Act extensively and is *****entirely persuaded that reasonable premiums, solid participation rates, and financial solvency over the 75-year period can be maintained.***** Finally, the AARP and the American Association of Homes and Services for the Aging ***** an association for small, non-profit nursing homes ***** announced their support for the program and asked that the audience call their Members of Congress to ask that the provision be included in the final Senate health reform bill (Kaiser, 2009).

In my professional life, I*****m working on a team of consultants hired by the National Council on Aging to coordinate several disability and aging advocacy organizations with the common goal of making long-term care reform a part of overall health care reform. We*****ve been working on the project for several months and, although we were initially advocating for several long-term care bills, we*****ve slowly whittled our request down to including the CLASS Act and the Senate Finance Committee Medicaid reform provisions in the final health reform bill. Personally, I believe the CLASS Act is a great first step toward helping individuals with disabilities finance long-term services and supports. I agree that the daily benefit of approximately $75 per day is small, but I believe the disability population needs a legislative foothold from which it can work to gain greater access to the supports and service for which it has been asking for some time. However, I am becoming increasingly skeptical about the chances of the CLASS Act in the final health reform bill given the opposition of key Senators on the Senate Finance Committee.

References

Feder, J., Komisar, H.L. Niefeld,M. (2000). Long-Term Care in the United States: An

Overview. Health Affairs (May/June 2000): 42.

Georgetown University Long-Term Care Financing Project. (2003) Fact Sheet: Who needs

long-term care? Retrieved from the web on November 2, 2009 at: www.ltc.georgetown.edu.

Houser, A. (2007). Long-Term Care Fact Sheet. AARP Public Policy Institute. Retrieved

from the web on November 2, 2009 at: http://www.aarp.org/ppi.

Kaiser Family Foundation (2009). The Sleeper in Health Reform: Long-Term Care and the

CLASS Act briefing materials. Retrieved from the web on November 2, 2009 at: http://www.kff.org/healthreform/kcmu102009pkg.cfm.

Kaiser Family Foundation. (2005). Kaiser Health Poll Report: The Public*****s Views on Long-

Term Care. Retrieved from the web on November 2, 2009 at: www.kff.org/healthpollreport.

O*****Brien, E. Elias, R. (2004). Medicaid and Long-Term Care. Kaiser Commission on Medicaid

and the Uninsured.

Rockefeller, J. (1991). Call for Action: The Pepper Commission*****s Blueprint for Health Care

Reform. Journal of the American Medical Association. 265: 2507 ***** 2510.

*****