Stephen Zuckerman is a senior fellow and vice president of health policy at the Urban Institute. He brings his 30+ years of experience to the Academy’s Medicare Eligibility Study Panel, which will publish a report that will anchor the Academy’s 2020 Conference on Health Care Coverage and Costs: Assessing Medicare-Based Approaches.
Q: American families are concerned about health care that’s affordable and accessible. What are you working on that can help us understand changes that are being proposed?
A team at the Urban Institute developed a proposal for The Healthy American Program, which builds on the strengths of both the Affordable Care Act (ACA) and the Medicare program. We try to take elements of both programs and put them together in ways that would focus on the affordability of coverage. Affordability is really one of the most important concerns of people right now and it’s often not being addressed directly in the policy debate.
In our approach, we try to protect people just outside the ACA subsidy range who can get hit with large premiums. We tried to create a plan that caps the amount people pay for health insurance premiums as a share of their income. We propose that no one should have to pay more than eight and a half percent of their income for their insurance premiums. People who are missing out on the subsidies—people at 450% or even 600% over the federal poverty level—can be paying a lot more than that as a share of income to get coverage through the exchanges. We think that’s too large a financial burden to ask of people.
Q: Who decides what a cost cap for health insurance premiums would be?
That’s a policy decision that would require Congressional action; it probably wouldn’t happen through a regulatory process. Allowing more people to have subsidies increases the need for government spending to pay for those subsidies, but we feel that’s the right way to go.
Q: What potential implications does your research have for the health care reform debate?
There’s no question, in terms of the policy debates you’re hearing now, that people want to use Medicare as the platform to build on. We agree that there are elements in Medicare worth building on, we just have a slightly different approach. For instance, we’re building on the rate setting that Medicare uses in order to bring prices down to a more affordable level. It may not be popular with providers, but it’s certainly one way to lower prices in the system. Most of the research suggests that what drives the high cost of health care in America are the high prices hospitals and physicians receive from private payers.
Q: Did you see a recent article in The Washington Post that suggests health care costs are like an $8,000 annual “tax” on every family?
$8,000 may not be a lot of money relative to the cost of very expensive medical treatments, but it certainly is a burden for families on a moderate-income level. This is one of the reasons why it is important to spread the costs more broadly across the nation.
Q: How do we do that?
We need to expand the subsidies that are available and finance them by either higher income tax or higher payroll tax for some people. That’s part of the political challenge of these types of reforms.
Q: What role does the current Medicare program play in reform debates?
There is a need to inform people about Medicare and how you can use it as a platform to expand coverage and potentially control costs. During political debates, you can’t get a good sense of how complicated it would be to put these ideas together into a new program. One of the values of the Academy’s Medicare Eligibility Study Panel is that it will lay out the choices legislators would have to make when they’re designing these programs. It’s always important to consider choices and implications before you go too far down the road, whether it’s through lowering the age of eligibility, allowing people to buy in to the program by paying a premium, or expanding Medicare so it covers all people in a Medicare for All proposal.
Q: What about voters? How can they evaluate the policy proposals candidates are putting forward?
Ultimately, voters will decide which candidate they’re comfortable with, most likely not based entirely on their position on health policy, but that will feed into the decision. The polling data we’ve seen on some of these health policy ideas is confusing. People like the idea of Medicare for All, because Medicare is a popular program, so they think a popular program for everyone is a good idea. But then they get less enthusiastic when they hear it may eliminate the private health insurance they have, which they may like well enough to keep. It’s not easy to explain when you have 90 seconds, or maybe two minutes, to give an answer.
People who are supporting Medicare for All may not realize they are supporting something that’s far more generous than the current Medicare program, in terms of services that will be covered and financial protections offered.
Q: Why would we not want Medicare for All?
We would have to decide that we’re going to run the health insurance system for everyone in the country through the public sector. It may not be impossible to do, but it will be quite different from our current system. Also, Medicare pays a lot less to physicians and hospitals than private insurance pays, so there is likely to be tremendous push back from them.
You see this already in the issue of surprise billing that occurs when people go to an in-network hospital and then get a bill from a doctor who was not in their network. This seems like a very simple consumer protection that you could legislate to make sure people are not hit with bills when they have played by the rules by going to an in-network hospital. But even that legislation couldn’t get passed. And that is a much simpler change than Medicare for All or, as some candidates are discussing, a public option.
More about Stephen Zuckerman
Stephen Zuckerman has studied health economics and health policy for 30 years and is a national expert on Medicare and Medicaid physician payment, including how payments affect enrollee access to care and the volume of services they receive. He is currently examining how payment and delivery system reforms can affect the availability of primary care services and be used to help address health-related social needs.
Zuckerman has published extensively on health care topics that include determinants of geographic differences in Medicare spending, Medicare Advantage, changes in Medicare benefit design that could protect the most vulnerable beneficiaries, and Medicaid physician payment. Zuckerman also codirected the development of the Geographic Practice Cost Indices used in the Medicare physician fee schedule.
Before joining Urban, Zuckerman worked at the American Medical Association’s Center for Health Policy Research. He received his PhD in economics from Columbia University. He has been a Member of the Academy since 2010.