Who Is Warning Us About the Perils of a Government-Run Public Health Insurance Plan?

There has been considerable discussion lately about whether the US government should offer a publicly run health insurance plan similar to the current Medicare program for the elderly and disabled. A recent report has thrown a bit of cold water on the idea, as noted in this AP article:

A public health insurance option for middle class families could help cover the uninsured but it may well put private insurers out of business, a respected consulting firm concluded in a study released Monday.

The report by the Lewin Group, a numbers-crunching firm that serves government and private clients, said it all depends on details that lawmakers are far from deciding. Nonetheless, the report could provide ammunition for critics who say a public plan would move in the direction of government-run medicine.

President Barack Obama and many Democrats want to create a government insurance plan to compete with private plans that now cover about 170 million Americans. The issue is major sticking point for Republicans and the insurance industry.

The Lewin study found that if such a plan were open to all employers and individuals, and if it paid doctors and hospitals the same as Medicare, the government plan would quickly grow to 131 million members, while enrollment in private insurance plans would plummet.

'The private insurance industry might just fizzle out altogether,' said John Sheils, a Lewin vice president and leading author of the study.

By paying Medicare rates the government plan would be able to set premiums well below what private plans charge. Monthly premiums for family coverage would be $761 in the government plan, compared with an average of $970 in private plans, the study estimated. Employers and individuals would flock to the public plan to cut costs.

This new report by the Lewin group also provided more ammunition to politically conservative commentators opposed to a public health insurance plan, e.g., see this link.

I am not going to comment on the substance of the report, or the argument over the merits of a public health insurance plan, save to note that in my humble opinion, the biggest danger of such a plan would be to further exaggerate differences in payments made to primary care and other "cognitive" physicians and to physicians who mainly do procedures. We have posted before (e.g., here) on how Medicare has come to fix payments to favor procedures and disfavor primary care and other cognitive services. Increasing the number of patients covered by Medicare or a Medicare-like plan, without changing the current Medicare payment system, would only make these discrepancies worse. Note that this potential problem with the public health insurance plan was not mentioned in the Lewin Group report.

Perhaps the nature of the Lewin Group influenced what this report did and did not emphasize. The group was described above as an independent consulting firm. Its web-site says it is "a premier national health care and human services consulting firm." It also claims:

The Lewin Group is committed to independence and integrity in our work. We combine professional expertise with extensive knowledge and a rigorous approach to analyzing and solving problems to deliver value to each of our clients and to the larger community as well.

That's a somewhat self-contradictory assertion. It seems that delivering "value" to specific clients might be hard to do while maintaining "independence."

Perhaps considering the nature of the Lewin Group's clients would clarify things. The group says its clients include "hospitals, health systems and providers;" "payers / insurers;" and "pharma/bio/device." The middle group seems most germane to a debate about The services provided to them include:

The Lewin Group helps payers and insurers succeed in complex government, commercial, and long-term care markets.

Based on our more than 20 years of experience, The Lewin Group offers our clients detailed understanding of the competitive marketplace and the expectations of purchasers. Based on rigorous, data-driven research, we provide our clients with actionable information grounded in practical, real-world advice.

Our understanding of public policy through our work with government entities, including Medicaid and SCHIP, helps us understand how policies are shaped and how they impact our clients. With this insight, we help our clients strategize and succeed in public programs and new product offerings.

So, the Lewin Group specifically offers to help insurers succeed in a complex market partially controlled by government. Maybe this orientation had some influence on the report they published now being used to support arguments for private, commercial health insurance.

Finally, who owns the Lewin Group? The description provided in the news story above suggests it is independent, and perhaps is even not-for-profit. Per Lewing Group web-site, it is neither:

The Lewin Group is an Ingenix company. Ingenix, a wholly-owned subsidiary of UnitedHealth Group, was founded in 1996 to develop, acquire and integrate the world's best-in-class health care information technology capabilities.

Ingenix has been in the news lately. See our posts here, here, and here about legal settlements of charges that large health care insurance companies used a database created and allegedly manipulated by Ingenix to underpay out of network claims. So, the Lewin Group is a part of Ingenix, an organization that just settled claims that it manipulated data about insurance payments.

Furthermore, Ingenix is in turn part of UnitedHealth. It is amazing how often UnitedHealth's antics have provided grist for the Health Care Renewal mill. See this post for a summary of the company's more recent escapades.

For balance, I must note that the Lewin Group web-page asserts:

The Lewin Group operates with editorial independence and provides its clients with the very best expert and impartial health care and human services policy research and consulting services.

But again, note that the focus is on making clients happy, not providing the public with unbiased knowledge.

So a report being used to support arguments against government-run health insurance was published by a subsidiary of one of the largest commercial health care insurance companies and managed care organizations, a subsidiary that just settled charges that it manipulated data to increase insurance company profits.

With a new administration in the White House, there is new interest in health care reform. It is not surprising that this has inspired some vigorous discussion. Nor is it surprising that some of the discussion comes from those with vested interests to protect. They have, of course, every right to make their views known. But it would be a more honest discussion if everyone were willing to put their vested interests on the table.

Who Is Warning Us About a Shortage of Gastroenterologists?

We have frequently discussed the worsening shortage of primary care physicians and the current crisis in primary care. Now, in the NY Times is a story of a different kind of physician shortage:

The United States will face a severe shortage of gastroenterologists as the population ages and the demand for colorectal cancer screening increases, a health care consulting firm has projected.

At current rates of cancer screening, the United States will need an additional 1,050 gastroenterologists by 2020, according to the study by The Lewin Group.

Note that this isn't the proclamation of a current shortage, but the forecast of one to come. The Times did not provide a link to the report, nor explain the rationale for its prediction. Given that gastroenterologists are remunerated much better for their time spent doing colonscopies than primary care physicians are spend for their time spent taking care of patients sans procedures (see: Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link here. ) , it is a little hard to believe that we will not be able to recruit sufficient gastroenterologists in the future, barring any radical change in how physicians are paid.

However, the NY Times article did note:

The projections were reviewed by outside experts and commissioned by Olympus Corporation of the Americas, which manufactures cameras used to screen for colorectal cancer.

Actually, Olympus manufactures not just the cameras, but the colonoscopes themselves (see their web-site, which states the company manufactures "a full line of diagnostic, therapeutic, slim and adult colonoscopes with the highest resolution available.")

Moreover the study was done by the Lewin Group, which was not further characterized in the NY Times article, but does often seem to be a source of authoritative pronouncements on health care policy. So what is the Lewin Group?

It's web-site says it is "a premier national health care and human services consulting firm." It also claims:

The Lewin Group is committed to independence and integrity in our work. We combine professional expertise with extensive knowledge and a rigorous approach to analyzing and solving problems to deliver value to each of our clients and to the larger community as well.

That's a somewhat self-contradictory assertion. It seems that delivering "value" to specific clients might be hard to do while maintaining "independence."

Who are Lewin's clients? We already know that Olympus, a company that makes more money if it sells more colonoscopes, sponsored this study of demand for colonoscopy. The Lewin Group says its clients include "hospitals, health systems and providers;" "payers / insurers;" and "pharma/bio/device." Furthermore, its explanation of its services to the latter group includes:

We provide analysis and results-focused strategies demonstrating the value of medical products to public and private sectors payers, clinicians, health care facilities, patients, and policymakers. We also provide policy insight and guidance to industry clients on evolving trends and their impacts.

"Results-focused strategies demonstrating the value of medical products" somehow seems more akin to marketing than objective policy analysis.

Finally, who owns the Lewin Group? It is not a not-for-profit, and it is not even an independent for-profit corporation. In fact, per the web-site,

The Lewin Group is an Ingenix company. Ingenix, a wholly-owned subsidiary of UnitedHealth Group, was founded in 1996 to develop, acquire and integrate the world's best-in-class health care information technology capabilities.

So, the Lewin Group is in fact part of UnitedHealth, a corporation that was until recently run by a CEO who became known for the more than a million of apparently back-dated stock options he received (see our post here).

For balance, I must note that the same web-page asserts:

The Lewin Group operates with editorial independence and provides its clients with the very best expert and impartial health care and human services policy research and consulting services.

But again, note that the focus is on making clients happy, not providing the public with unbiased knowledge.

One might further argue that it is not in the interests of UnitedHealth, as a commercial managed care organization, to pay for more and more colonoscopies. However, in the current US health care system, in which there have been more and more procedures, UnitedHealth has prospered, perhaps because it has been easy for it to simply past the costs of these procedures along.

At any rate, once again it's hard to tell who the players are in health care policy without a scorecard. As the health reform debate heats up, expect to see more authoritative proclamations coming from groups with vested interests other than simply providing unbiased expertise. Such groups, of course, have the right to make their views known. But it would be a more honest discussion if everyone were willing to put their vested interests on the table.

Thanks to one of our scouts for a tip on the ownership of the Lewin Group, and hat tip to KevinMD.