Press Release – Oregon Right to Try Bill Unanimously Passes the House and Senate

July 6, 2015

FOR IMMEDIATE RELEASE

Media Contact:

Steve Buckstein

503-242-0900

steven@cascadepolicy.org

Oregon Right to Try Bill Unanimously Passes the House and Senate

PORTLAND, Ore. – Oregon’s Right to Try bill, HB 2300 B, passed 29-0 in the Senate and was re-passed with some restrictive amendments in the House by 60-0 last week. It now goes to Governor Kate Brown’s desk for her signature. The law will give some terminally ill Oregonians the Right to Try experimental drugs and devices not yet approved by the FDA.

Cascade Policy Institute founder Steve Buckstein noted, “The final bill is more restrictive than similar statutes in 21 other states (with its 18-year-old minimum age limit and its six-months to expected death definition of terminal illness), but it’s a good start and hopefully can be expanded in the future to cover children and people who have terminal illnesses such as ALS where patients may live for a number of years.”

Buckstein thanked House Health Care Committee Chair Mitch Greenlick (D), committee member and work group leader Knute Buehler, MD (R), and Senate Health Care Committee Chair Laurie Monnes Anderson (D) for all their hard work on the bill. He noted that these three legislators started working on this legislation before the session even started, and stuck with it all the way to final unanimous passage in both houses.

Buckstein also thanked the Goldwater Institute of Arizona for pioneering the Right to Try concept around the country and for its help in Oregon. He also thanked Diego Morris, the Arizona teenager who had to move to London for treatment approved in Europe but not in the United States when he contracted terminal osteo sarcoma at age eleven. The treatment was successful and Diego is now cancer free. Diego and his mother Paulina visited the Oregon Capitol in February to make their case for allowing terminally ill Oregonians the right to try experimental drugs. When asked by a reporter what he would say to critics of the Oregon Right to Try bill, he looked up at her and said, “Wait until they find themselves in my situation, and then ask them.”

Buckstein concluded, “This truly bipartisan effort resulted in a bill that could literally mean the difference between life and death for some terminally ill Oregonians. I’m proud of the work Cascade Policy Institute did to promote the Right to Try concept and bill in Oregon, and look forward to Governor Brown signing the bill so it can take effect at the beginning of 2016.”

Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

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Oregon’s Proposed Sick Leave Law Doesn’t Fit All

By Anna Mae Kersey

Senate Bill 454, which mandates that employers implement paid sick leave for employees, may leave small business owners and the agriculture industry in the dust.

SB 454 states, “Employers that employ at least 10 employees working anywhere in this state shall implement a sick time policy that allows an employee to earn and use up to 40 hours of paid sick time per year.” Employers with fewer than 10 employees must provide the same amount of sick time, but it can be unpaid.

For big businesses and corporations, this mandate might not pose a problem; many larger companies already offer competitive benefits packages that include paid sick leave and vacation time.

For small businesses and the agriculture industry, however, 40 hours of paid sick time per year translate into five days during which the employer will not only be short an employee, but will still be compensating that employee for his or her time.

According to the Associated Oregon Industries, 88,000 business owners in Oregon employ fewer than 50 people. Although the Senate had the opportunity to accommodate those industries, that motion failed. By forcing business owners to take a uniform approach, instead of one tailored specifically to best suit both the employer and the employee, this bill could have real economic consequences.

These business owners will now likely have to cut costs by downsizing their companies, lowering wages, and increasing prices in order to offset the mandate’s impact.

Anna Mae Kersey is a research associate at Cascade Policy Institute, Oregon’s free market think tank. She recently graduated from Mercer University in Macon, Georgia with an Honors B.A. in Philosophy and is pursuing a Master’s of Liberal Arts at St. John’s College in Santa Fe, New Mexico.

Make Medical Providers Compete on Price as Well as Quality

By Roger Stark, MD, FACS

The method doctors and hospitals are paid for their work is undergoing gradual but relentless change. Providers traditionally have been compensated on a fee-for-service basis, where they receive a specific amount of money for a specific visit or medical procedure. This is how other highly trained professionals, like lawyers, dentists, auto mechanics, and architects are paid—they receive a fee for service rendered.

The main argument offered against allowing doctors to charge for their services is that it leads to overutilization and increases healthcare costs. Doctors are accused of ordering more visits, extra tests, and unnecessary operations simply to pad their incomes.

From an economic standpoint, the fundamental difference with health care is the third-party payer system in the United States. The overwhelming majority of health care in this country is paid for by employers or the government, with money channeled through heavily regulated insurance companies. In other economic activities, consumers pay directly for a product or service and consequently become savvy shoppers who can take advantage of marketplace competition. In health care, patients are largely barred from shopping and have become isolated from true costs they incur.

Third-party payers were disinterested until healthcare costs and utilization exploded. Now, the payers, and not patients or providers, are attempting to change the payment model by imposing wage and price controls on doctors and hospitals. Patients are not seeking these caps, they are cost-control efforts by the entities that have to pay the bills.

A second argument against doctor fees is it discourages the use of “integrated care,” by which patients are placed in some type of provider-group that controls all aspects of their care. These integrated groups have many different names, including medical homes and accountable care organizations (coordinated care organizations in Oregon). In reality, they are simply various forms of the health maintenance organizations (HMOs).

HMOs may or may not provide integrated care but, through force, they can hold down healthcare costs. HMOs decrease healthcare costs by using a gatekeeper system where clinical decisions are weighed against budgets. Various types of HMOs are strongly encouraged or outright mandated in the Affordable Care Act.

The idea of pay-for-performance is becoming popular with payers, regulators, and policymakers. The reason is that they, not patients or doctors, decide what “performance” means and how much the “pay” will be. Providers get paid a higher amount if they meet certain quality measures that are determined, in many cases, by non-clinician policymakers or other regulators.

Results with the pay-for-performance model over the past 15 years have been varied. There is no clear evidence its defined quality measures decrease patient complications, improve care, or predictably lower costs. It does increase the regulatory and compliance burden on providers, however. In reality, most hospitals have been improving quality measures and the patient experience without pay for performance.

What is a real and meaningful solution to the provider reimbursement problem?

First, solve the third-party payer problem by removing employers and the government as payers of most health care. Allow patients, working with their providers, to make their own medical decisions and control their own healthcare dollars. Change the tax code and allow individuals to take the same health insurance deduction employers now receive. Use government programs such as Medicare and Medicaid as safety-net plans for low-income people. Reform or repeal the vast new system of government controls imposed by the Affordable Care Act.

Second, allow more competition in the health insurance industry by eliminating many of the government benefit mandates. Let patients decide what insurance plans are best for them and allow them to purchase plans across state lines. Encourage the use of health-savings accounts and low-cost, high-deductible insurance plans.

Third, increase the use of high-risk pools for high-use and high-cost patients.

Fourth, pass meaningful tort reform so providers don’t feel the need to order extra tests out of fear of lawsuits.

Finally, encourage more price transparency in the system and allow providers to compete on price as well as quality, just as professionals do in other parts of our economy.

The most important person in the healthcare system is the patient, not cost-conscious employers or distant government bureaucrats. The patient, as a consumer of health care, should determine the value and quality of services received and how much doctors should be paid to provide them.


 

Dr. Roger Stark is a health care policy analyst at Washington Policy Center in Seattle, Washington and a retired physician. He is a guest contributor for Cascade Policy Institute, Oregon’s free market public policy research center. A version of this article originally appeared in The Seattle Times.


 

Oregon Children Deserve the Right to Try

Oregon hopefully will join twelve states that have enacted Right to Try legislation, allowing terminally ill patients to try experimental drugs not yet approved by the FDA.

In several states, the face of Right to Try efforts was a child. Fourteen-year-old Diego Morris was honorary chairman of the Arizona campaign that saw 78 percent of voters approve Right to Try last November. Diagnosed with a deadly form of bone cancer when he was eleven, Diego and his family had to move to London for treatment with a drug approved there, but not in the United States. Now cancer free, Diego visited the Oregon Capitol in February to meet with legislators. When asked what he would say to opponents of Right to Try, Diego answered, “Wait until they find themselves in my situation, and then ask them.”

Five-year-old Jordan McLinn handed the pen to Indiana Governor Mike Pence when he signed that state’s Right to Try law last week. Jordan has Duchenne Muscular Dystrophy, a terminal illness that without experimental treatment may kill him before he turns 20.

No doubt some Oregon children could benefit from the Right to Try. House Bill 2300 would give adults that right, but not children under age 15. Those who favor Right to Try might let their state legislators know that faced with a terminal illness, children should have the same Right to Try as adults do.

Looking at ObamaCare, Five Years On

By Sally C. Pipes

ObamaCare turned five years old March 23. But don’t break out the cake and candles. There’s not much to celebrate. When he signed his signature piece of legislation into law, President Obama guaranteed lower health costs, universal coverage, and higher-quality care. Five years later, the health law has failed to fulfill those promises.

“In the Obama administration,” candidate Obama boasted in 2008, “we’ll lower premiums by up to $2,500 for a typical family in a year.”

A recent report by HealthPocket, an online insurance marketplace, has revealed that premiums for individual Americans skyrocketed after ObamaCare became law.

Drug costs have jumped, too, despite promises to the contrary from the Obama administration. The majority of health plans offered on the exchanges have shifted costs for expensive medications onto patients, according to a study by Avalere Health. In 2015, more than 40 percent of all “silver” exchange plans―the most commonly purchased―charged patients 30 percent or more for specialty drugs. Only 27 percent of silver plans did so last year. Part of the problem is that the health law has quashed market competition.

The president promised in 2013 that “this law means more choice, more competition, lower costs for millions of Americans.” But that hasn’t turned out to be true. According to the Heritage Foundation, the number of insurers selling to individual consumers in the exchanges this year is 21.5 percent less than the number that were on the market in 2013―the year before the law took effect.

The Government Accountability Office reports that insurers have left the market in droves. In 2013, 1,232 carriers offered insurance coverage in the individual market. By 2015, that number had shrunk to 310.

With competition in the exchanges on the decline, quality is going down, too―just like President Obama said in 2013: “Without competition, the price of insurance goes up, and the quality goes down.”

Consumers who purchase insurance on the law’s exchanges have fewer options than they had pre-ObamaCare. The consulting firm McKinsey & Co. noted that roughly two-thirds of the hospital networks available on the exchanges were either “narrow” or “ultra-narrow.” That means that these insurance plans have refused to partner with at least 30 percent of the area’s hospitals. Other plans exclude more than 70 percent.

Patients may also have fewer doctors to pick from. More than 60 percent of doctors plan to retire earlier than anticipated―by 2016 or sooner, according to Deloitte. The Physicians Foundation reported in the fall that nearly half of all doctors―especially those with more experience―considered ObamaCare’s reforms a failure.

While more Americans may have insurance thanks to ObamaCare, they may not be able to find a doctor to see them. That’s a recipe for waiting lists and de facto rationed care.

Finally, five years on, President Obama’s declaration that he would not sign a plan that “adds one dime to our deficits―either now or in the future” looks more ridiculous than ever. In 2010, the Congressional Budget Office anticipated ObamaCare’s decade-long cost was $940 billion. This year, the CBO more than doubled that price tag, with a new estimate of $2 trillion.

The U.S. Supreme Court will rule this June on King v. Burwell, a case that threatens to negate the law’s subsidies. If the court rules against the administration, ObamaCare would unravel.

Obama has been proven wrong about what his health law would accomplish. Quality hasn’t improved, and costs continue to grow. That’s ObamaCare’s five-year legacy.


Sally C. Pipes is President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute in San Francisco. She is a guest contributor for Cascade Policy Institute. A version of this article was originally published by The Orange County Register.

Oregon Seniors Deserve Truth in Medicare Reform

By Steve Buckstein and Patrick M. Gleason

If Congress doesn’t act by the end of this month, when payment cuts to Medicare providers are scheduled to hit, there will be a major health care crisis. Topping the to-do list is addressing urgent problems with Medicare, the most costly federal program and the largest driver of national debt. Failure to act would have harsh ramifications for seniors and caregivers in Oregon.

The first step is to address accounting gimmicks that hide Medicare’s true cost and its effect on federal debt in the years ahead. The program operates under a phony spending baseline that conceals its true cost.

How did this come about? In 1997, Congress instituted a new spending formula, the Sustainable Growth Rate (SGR). It would institute physician reimbursement rate cuts in order to ensure that Medicare spending did not exceed the rate of economic growth. Noble goal, except that’s not what happened.

In 2003, the first time Medicare cuts were scheduled to take place under SGR, lawmakers balked and delayed the scheduled reduction in physician payments. In the 11 years since, Congress has delayed these scheduled payment cuts a whopping 17 times. This maneuver is referred to as the “doc fix.”

The Congressional Budget Office is forced to operate under the assumption that Congress will comply with SGR, even though the last 11 years have shown that to be pure fantasy. CBO treats passage of a doc fix as a spending increase. But it’s not, in reality, because Congress always passes a temporary reprieve. The worst kept secret on Capitol Hill is that Congress will always, just in the nick of time, pass a doc fix to prevent these payment reductions.

Underscoring this fact, for the first time ever, even Medicare’s own actuaries admitted last year that scheduled SGR payment cuts never would occur. The solution is to end this game, start being honest with ourselves, pass a permanent doc fix, and move on to reforms necessary to ensure the nation’s fiscal health and Medicare’s sustainability.

For Oregon, failure to pass a permanent doc fix would reduce seniors’ access to care. Oregon has 16 practicing physicians per 1,000 Medicare beneficiaries, which is below the national average. If Congress does not act, the result will be a 24 percent across-the-board pay cut for caregivers treating Medicare patients. With 46 percent of Oregon’s physicians over the age of 50, the age at which surveys show many physicians begin to consider cutting back on patient care, scheduled provider cuts would only exacerbate Oregon’s problems with access to care.

A temporary doc fix breeds corruption and legislative chicanery, producing a gold mine for lobbyists and political fundraisers. Worse, the constant need to pass an emergency, temporary doc fix distracts from much-needed Medicare reforms. If Congress continues to ignore the unsustainable trajectory of Medicare spending, the result will be harm to seniors and a federal budget drowning in red ink.

Fixing what’s wrong with Medicare is the top health and budgetary issue facing the country. As former Congressional Budget Director Doug Holtz-Eakin warns, “By 2020, as Baby Boomers continue to age into Medicare at the rate of more than 10,000 a day, Medicare’s cumulative $6.2 trillion in cash flow deficits will constitute 35 percent of the nation’s total debt accumulation.”

It’s time for members of Congress to stop kicking this can down the road, institute truth in accounting by passing a permanent doc fix, roll up their collective sleeves, and get to work on the real reforms that will save Medicare and put the nation on a sound fiscal path.


Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization. Patrick Gleason is director of state affairs at Americans for Tax Reform in Washington, D.C. The Bend Bulletin newspaper op-ed version of this commentary was originally published on March 25, 2015 here: www.bendbulletin.com/opinion/3004859-151/letter-oregonians-deserve-medicare-reform.

Are ObamaCare’s Insurance Subsidies Legal?

Today the U.S. Supreme Court hears oral arguments in a case challenging the implementation of the Affordable Care Act (ACA). Plaintiffs in King v. Burwell claim the Internal Revenue Service (IRS) does not have the authority to circumvent the actual text of the ACA. According to the law, federal insurance premium subsidies can be allotted only if plans are purchased “through an Exchange established by the State.” When 36 states chose not to create their own exchanges, the IRS essentially rewrote this portion of the law to give subsidies anyway.

Oregon did set up a state exchange―Cover Oregon. But Cover Oregon never worked as planned; and now Oregon is contracting with the federal exchange, HealthCare.gov. The federal government and Oregon state officials claim this will guarantee Oregonians continued access to federal subsidies, but the King decision may not allow such subsidies to continue.

The King v. Burwell case could have a major impact on the future of ObamaCare. If the Court strikes down the IRS rule, the government would withhold subsidies for those living in states that chose to protect their citizens from the law’s employer mandate, the individual mandate, and the high costs of operating their own state-based exchanges. The Court’s decision could provide an important opportunity for states to reform health care in a meaningful way that respects taxpayers, provides for the truly needy, and addresses health care costs.

A ruling is expected by June 30.

Event Video – The Man Who Could Bring Down Obamacare




On February 26, 2015 at a co-sponsored event presented by Cascade Policy Institute and Washington Policy Center, Michael Cannon, Director of Health Policy Studies at the Cato Institute, spoke before a packed house at the Multnomah Athletic Club in Portland, OR.

After the passage of the Affordable Care Act (ObamaCare), critics noticed that subsidies for health insurance purchases would be available only through “an Exchange established by the State,” such as the ill-fated Cover Oregon. The IRS actively ignored this part of the law and offered subsidies to those using the federal exchange, healthcare.gov, as well. Four legal challenges were filed to stop those illegal subsidies – and the illegal taxes they trigger. One of those challenges, King v. Burwell, goes before the U.S. Supreme Court on March 4, 2015 with a ruling expected by June 2015.

Michael F. Cannon is considered “ObamaCare’s single most relentless antagonist” and an “intellectual father” of the legal strategy that would expose how ObamaCare doesn’t work simply by requiring the Obama administration to follow the letter of the law. He will speak in Portland just six days before the U.S. Supreme Court hears oral arguments in King v. Burwell. “The man who could bring down ObamaCare” will discuss the case, what it means for Oregonians and Washingtonians, and how Congress should reform health care after ObamaCare.

The Man Who Could Bring Down ObamaCare

Would you like to meet the man the media says could bring down ObamaCare? You’ll have that opportunity on Thursday evening, February 26, when Michael Cannon of the Cato Institute speaks in Portland.

Cannon is an architect of the legal strategy that could force the Obama Administration to follow the letter of its own Affordable Care Act and stop subsidizing insurance unless it is purchased through a state-established exchange. Cover Oregon was established by the state, but its website was so flawed that it couldn’t sign up a single person.

If Oregonians lose their subsidies because Cover Oregon failed, they will quickly find out just how unaffordable the Affordable Care Act really is.

To make this even more interesting, on the day Governor Kitzhaber resigned, the U.S. House Oversight Committee sent him a letter telling him not to destroy any documents that might shed light on the Cover Oregon fiasco.

And the U.S. Supreme Court will hear oral arguments in the case orchestrated by Michael Cannon on March 4.

Don’t miss your chance to meet The Man Who Could Bring Down ObamaCare on Thursday evening, February 26, in Portland.

For details and to RSVP, call Cascade Policy Institute at 503-242-0900, or visit cascadepolicy.org.

Right to Try Is Right for Oregon: Let terminally ill patients try to save their own lives

If you or someone in your family had a terminal illness, would you want the right to try an experimental drug that might save a life? That’s what eleven-year-old Diego Morris of Phoenix wanted when he was diagnosed with a rare, deadly form of cancer. Traditional treatment didn’t work; and after an exhaustive search, his family found a “miracle drug” that was approved in much of the world but not in the United States. So, the whole family moved to England where Diego was successfully treated. Now back in Phoenix, Diego has been cancer-free for two years.

Now thirteen years old, Diego Morris was the Honorary Chairman of the campaign that saw 78 percent of Arizona voters approve a Right to Try referendum last November. It will give terminally ill patients the right to try to save their lives by allowing access to investigational medicines that have not yet been approved by the U.S. Food and Drug Administration (FDA). Diego supported the measure because he said “…hope was the most important thing to him and giving hope to others is what he thinks the right to try law will do.”

Oregon legislators are now being asked to approve Right to Try legislation here. HB 2300 in the House Health Care Committee would not compel physicians or drug companies to provide any treatment; it would simply allow terminally ill patients the right to try to get access to drugs or devices not yet approved by the FDA.

In addition to Arizona, Right to Try laws have been enacted overwhelmingly within the last year by legislatures in Colorado, Louisiana, Missouri, and Michigan. Legislatures in more than twenty states are now being asked to give their citizens this important right.

Designed by the Goldwater Institute in Arizona, the Right to Try concept addresses a growing dissatisfaction with the slow process of approving life-saving medications in America. Creating, developing, testing, and getting government approval to market a new drug here can take upwards of ten years and cost more than one billion dollars. While this process may keep unsafe or ineffective drugs off the market, it may also keep effective drugs away from critically ill patients for so long that they literally die waiting.

Only about three percent of the sickest Americans qualify for or have access to FDA-approved clinical drug trials, and even those who enter such trials cannot be sure whether they are receiving a potentially useful drug or a placebo. Some medical researchers worry that granting terminally ill patients the right to try investigational medicines may make it harder to recruit people for randomized controlled trials. However, more and more people now recognize that an individual’s right to try to save their own life should trump the need that researchers might have to control how those drugs are tested.

As Goldwater Institute president Darcy Olsen says, “Terminal patients shouldn’t have to ask the government for permission to try to save their own lives.”

While the FDA does allows people to request access to medicines that have not yet been approved, the process can require 100 hours of paperwork and months to complete, with no assurance that access will be granted. Currently, fewer than 1,000 individuals get such approval annually. Right to Try offers a better way.

Some legal scholars worry that the federal government will challenge state Right to Try laws under the Supremacy Clause of the U.S. Constitution, which says that when federal and state laws conflict it is federal law that should take precedence. While this is often the case, Oregon is in the forefront of what could be a very relevant exception.

Oregon voters twice approved the state’s controversial Death With Dignity Act, in 1994 and again in 1997. The law allows “terminally-ill Oregonians to end their lives through the voluntary self-administration of lethal medications, expressly prescribed by a physician for that purpose.” The medications, however, are deemed controlled substances by the FDA and not federally approved for such a purpose.

The U.S. Attorney General argued that because federal law prohibited controlled substances from being used to intentionally end life, the Courts should strike down the Oregon law. The U.S. Supreme Court disagreed. In Gonzales v. Oregon (2006), the Court upheld Oregon’s law. It found that states generally have wide discretion in regulating health and safety, including medical standards. Finding that the Bush Administration’s reading of the federal statute would mark “a radical shift of authority from the States to the Federal Government to define general standards of medical practice in every locality,” the Court ruled that Oregon could protect the rights of its citizens, at least in this specific instance.

If Oregon can protect the right of its citizens to end their own lives with controlled substances, it should be able to protect the right of its citizens to try to save their own lives with substances not yet approved by the federal government.

As thirteen-year-old cancer survivor Diego Morris believes, Right to Try can offer hope to people facing life-ending situations when federal law offers no hope. It’s a policy whose time has come, and Oregonians deserve.

Right to Try is right for Oregon.

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