Dr. Sorum testifies
Report on the GHI/HIP conversion hearing.
At the hearing, the 4 representatives from HIP/GHI argued, repeatedly, that they need to have access to public capital markets in order to get money to improve their infrastructure so that they can compete successfully with the big private insurers. The chair of the insurance department panel was obviously skeptical but asked mostly technical questions. (In fact, most of the capital investments would, I think, be for HIP's role as a health provider, not as an insurer--it apparently runs hospitals and community health centers.)
The first speaker, our own Arnie Ritterband, gave an eloquent and articulate condemnation of for-profit insurers. The second speaker, from HANYS (Hospital Association of NYS), talked like a PNHP member as well, citing (if I remember correctly) the overwhelming evidence that quality is lower with for-profit insurers. I was the third speaker and contended that for-profit is contrary to the nature of health care and health insurance; I will copy my testimony below. Finally, the head of the NY insurance lobby gave a quite incoherent defense of the merger. I left after that.
Two of the insurance panelists, Troy Oeschner and Kathy Shure, are on the governor's commission to study how to achieve universal health insurance in NY. Even if we didn't stop the merger (which will no doubt take place in spite of our arguments), our case against for-profit insurance might have an impact on the work of the commission.
Paul
Presentation to the Superintendent of Insurance in Opposition to the Planned Conversion to For-Profit Status of HIP and GHI
Albany, January 31, 2008
Paul Sorum., MD
Professor of Internal Medicine and Pediatrics
Albany Medical College
I am a primary care physician for children and adults. My patients expect me to take care of them, not to make profits off of them. I am a teacher of medical students and residents; these future doctors are bright and talented young people who could, if they chose, make lots of money in other careers, but they want, above all, to comfort and heal people who are ill.
The fundamental goal of health care is to provide care to all those who need it, whatever their income, their social status, their habits. It is not to make profits. The fundamental role of health insurance should be to enable patients and health care providers to come together-to provide access to patients and fair reimbursements to providers. It should not be a means of making profits.
Health care is a social good: it is in the interest of society and its members that everyone be as healthy and productive as possible. Health insurance plays, therefore, an important social role. It should not be allowed to become instead a machine to generate high salaries for executives and profits for investors.
The Spitzer administration is aware that all New Yorkers should have health insurance. It is aware of the social importance of health insurance and of society's responsibility to provide access to health care to its citizens. The Spitzer administration should not, therefore, allow health care to become even more subject to, and a victim of, the dictates of the insurance market.
If you allow HIP and GHI to merge and become an investor-owned, for-profit company, you will create a new imperative-the need to make profits for the investors, for the shareholders. How can the company do this? As you well know, it cannot raise premiums above those of its competitors if it wants to sell its health policies to employers (or, to a much lesser degree, to individuals). To get money for the investors, it must-and other for-profit health insurers do--decrease the percentage of premiums spent on actual health care services. To do this, the for-profit company must limit care when possible and must pass along expenses to patients and providers (in the form of denials of payments, prior authorizations, ever-changing formularies, and the hospital and office staff dedicated to submitting claims, obtaining prior authorizations, and the like). The patients, my staff, and I work for the insurance company so that it can pay its executives and shareholders.
No wonder then that, in ratings of health insurers in terms of customer satisfaction and quality, not-for-profit insurers do consistently as well as or better than for-profit insurers. For example, the Health Care Report Card for 2007 of the NYS Health Accountability Foundation (at http://hcrc.abouthealthquality.org) rates for Albany County 3 not-for-profits (CDPHP, MVP, and GHI) and 2 for-profits (Empire Blue Cross Blue Shield and Blue Shield of Northeastern New York). In customer satisfaction, CDPHP is first and MVP second, although GHI is last. In the NCQA/US News &World Report rankings of Best Health Plans in 2007, among commercial plans, Harvard Pilgrim Health Care (not-for-profit) is #1 in the country; MVP (not-for-profit ) at #19 is the highest in New York State.
I speak in the name of the current and future physicians who are dedicated, above all, to the health and well-being of their patients. I speak also in the name of their patients and of all other patients in New York State. I urge you to stop the scandal of using the health insurance of the people of New York as a means to generate high salaries for health insurance executives and profits for individual investors. I urge you to tell HIP and GHI that they must remain as not-for-profits dedicated to the good of individual patients and of the public.
At the hearing, the 4 representatives from HIP/GHI argued, repeatedly, that they need to have access to public capital markets in order to get money to improve their infrastructure so that they can compete successfully with the big private insurers. The chair of the insurance department panel was obviously skeptical but asked mostly technical questions. (In fact, most of the capital investments would, I think, be for HIP's role as a health provider, not as an insurer--it apparently runs hospitals and community health centers.)
The first speaker, our own Arnie Ritterband, gave an eloquent and articulate condemnation of for-profit insurers. The second speaker, from HANYS (Hospital Association of NYS), talked like a PNHP member as well, citing (if I remember correctly) the overwhelming evidence that quality is lower with for-profit insurers. I was the third speaker and contended that for-profit is contrary to the nature of health care and health insurance; I will copy my testimony below. Finally, the head of the NY insurance lobby gave a quite incoherent defense of the merger. I left after that.
Two of the insurance panelists, Troy Oeschner and Kathy Shure, are on the governor's commission to study how to achieve universal health insurance in NY. Even if we didn't stop the merger (which will no doubt take place in spite of our arguments), our case against for-profit insurance might have an impact on the work of the commission.
Paul
Presentation to the Superintendent of Insurance in Opposition to the Planned Conversion to For-Profit Status of HIP and GHI
Albany, January 31, 2008
Paul Sorum., MD
Professor of Internal Medicine and Pediatrics
Albany Medical College
I am a primary care physician for children and adults. My patients expect me to take care of them, not to make profits off of them. I am a teacher of medical students and residents; these future doctors are bright and talented young people who could, if they chose, make lots of money in other careers, but they want, above all, to comfort and heal people who are ill.
The fundamental goal of health care is to provide care to all those who need it, whatever their income, their social status, their habits. It is not to make profits. The fundamental role of health insurance should be to enable patients and health care providers to come together-to provide access to patients and fair reimbursements to providers. It should not be a means of making profits.
Health care is a social good: it is in the interest of society and its members that everyone be as healthy and productive as possible. Health insurance plays, therefore, an important social role. It should not be allowed to become instead a machine to generate high salaries for executives and profits for investors.
The Spitzer administration is aware that all New Yorkers should have health insurance. It is aware of the social importance of health insurance and of society's responsibility to provide access to health care to its citizens. The Spitzer administration should not, therefore, allow health care to become even more subject to, and a victim of, the dictates of the insurance market.
If you allow HIP and GHI to merge and become an investor-owned, for-profit company, you will create a new imperative-the need to make profits for the investors, for the shareholders. How can the company do this? As you well know, it cannot raise premiums above those of its competitors if it wants to sell its health policies to employers (or, to a much lesser degree, to individuals). To get money for the investors, it must-and other for-profit health insurers do--decrease the percentage of premiums spent on actual health care services. To do this, the for-profit company must limit care when possible and must pass along expenses to patients and providers (in the form of denials of payments, prior authorizations, ever-changing formularies, and the hospital and office staff dedicated to submitting claims, obtaining prior authorizations, and the like). The patients, my staff, and I work for the insurance company so that it can pay its executives and shareholders.
No wonder then that, in ratings of health insurers in terms of customer satisfaction and quality, not-for-profit insurers do consistently as well as or better than for-profit insurers. For example, the Health Care Report Card for 2007 of the NYS Health Accountability Foundation (at http://hcrc.abouthealthquality.org) rates for Albany County 3 not-for-profits (CDPHP, MVP, and GHI) and 2 for-profits (Empire Blue Cross Blue Shield and Blue Shield of Northeastern New York). In customer satisfaction, CDPHP is first and MVP second, although GHI is last. In the NCQA/US News &World Report rankings of Best Health Plans in 2007, among commercial plans, Harvard Pilgrim Health Care (not-for-profit) is #1 in the country; MVP (not-for-profit ) at #19 is the highest in New York State.
I speak in the name of the current and future physicians who are dedicated, above all, to the health and well-being of their patients. I speak also in the name of their patients and of all other patients in New York State. I urge you to stop the scandal of using the health insurance of the people of New York as a means to generate high salaries for health insurance executives and profits for individual investors. I urge you to tell HIP and GHI that they must remain as not-for-profits dedicated to the good of individual patients and of the public.
posted by Andy at Friday, February 08, 2008
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