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�Tab
This Section Includes:
13.
F i n a n c i n g H e a l t h Care f o r Persons w i t h
HIV Disease: P o l i c y O p t i o n s .
Technical
Report Prepared f o r t h e N a t i o n a l
Commission on AIDS. August 1991
�Financing Health Care for Persons with HTV Disease:
Policy Options
Technical Report Prepared for the
National Commission on AIDS
August 1991
�FINANCING HEALTH CARE FOR PERSONS WITH HIV DISEASE:
POLICY OPTIONS
T e c h n i c a l Report prepared f o r the
National Commission on AIDS
August 26, 1991
Karen Davis, Ph.D.*
Ron B i a l e k , M.P.P.**
C h r i s Beyrer, M.D., M.P.H.***
P a t r i c k Chaulk, M.D., M.P.H.****
Peter Cowley, M.D., M.P.H.*****
J e n n i f e r Harlow, M.H.S.******
Rose Chu, M.B.A.*******
*
**
***
****
*****
******
*******
P r o f e s s o r and Chairman, Department of Health P o l i c y and
Management, Johns Hopkins School of P u b l i c Health,
624 N. Broadway, Baltimore, Maryland 21205.
D i r e c t o r , Health Program A l l i a n c e , and I n s t r u c t o r ,
Department of Health P o l i c y and Management, Johns
Hopkins School of P u b l i c Health.
Preventive Medicine Resident, Johns Hopkins School of
P u b l i c Health.
C h i e f Preventive Medicine Resident, Johns Hopkins
School of P u b l i c Health.
Preventive Medicine Resident, Johns Hopkins School of
P u b l i c Health.
Research A s s o c i a t e , Johns Hopkins School of P u b l i c
Health.
Economist, A c t u a r i a l Research Corporation.
�This report was funded by the National Commission on AIDS.
The authors wish to thank members of the Commission and i t s s t a f f
for helpful comments, as well as reviewers of the report
including Peter Arno, Mary Ann Baily, Ron Brookmeyer, Phil Caper,
Molly Coye, Neil Graham, Fred Hellinger, Nancy Kass, P h i l i p Lee,
Harvey Makadon, Dick Merritt, John Palenicek, C a i t l i n Ryan,
Alfred Saah, Anne Scitovsky, Andrew Schneider, Mark Smith, Bruce
Vladeck, David Vlahov, Robin Weiss and Tim Westmoreland.
Additional assistance was provided by the National Association of
Community Health Centers, the Centers for Disease Control, the
National Hemophilia Association, and the National Organization of
Rare Diseases. The views are those of the authors and not
necessarily those of the National Commission on AIDS, Johns
Hopkins University, or Actuarial Research Corporation.
11
�Table of Contents
I.
2
A.
Population i n Need
2
B.
II.
The Economics of HIV Disease
Current Estimates of the Cost of Caring for
Persons with HIV Disease
1.
The Health Care Costs of AIDS
2.
The Health Care Costs of HIV I n f e c t i o n . . . .
Health Financing for Persons With HIV Disease:
Current System
6
7
10
The
11
A.
Health Insurance Coverage: An Overview
11
B.
P r i v a t e Insurance
13
C.
Medicaid
17
D.
Medicare
25
E.
Other Health Financing Sources
27
I I I . A d d i t i o n a l Health Care Financing Considerations
A.
....
Delays and B a r r i e r s to E a r l y I n t e r v e n t i o n and
Treatment
1.
Access to T e s t i n g
2.
Access to Drug Treatments
3.
Delays and B a r r i e r s for S p e c i a l Populations
29
.
29
29
31
33
B.
Provider Centered B a r r i e r s
35
C.
F i n a n c i a l Burden on Providers
1.
Hospitals
2.
Migrant/Community Health Centers and C l i n i c s .
3.
Primary Care Providers and Medicaid
36
36
38
40
D.
I n e f f i c i e n c y i n Current Care P a t t e r n s
41
i n
�IV.
P o l i c y Options and Recoimnendations f o r Improving
Financing f o r Persons with HIV Disease
A.
43
U n i v e r s a l Health Insurance
45
Option 1; Provide u n i v e r s a l h e a l t h care coverage f o r
a l l persons l i v i n g i n the United S t a t e s to ensure
a c c e s s to q u a l i t y h e a l t h care s e r v i c e s .
1.
2.
B.
Health
Impact
Cost
45
47
Medicaid
48
Option 2: Expand Medicaid to cover a l l low-income
people with HIV d i s e a s e . I n c r e a s e Medicaid payment
r a t e s for p h y s i c i a n s , h e a l t h c e n t e r s , h o s p i t a l s , and
other h e a l t h care providers to a l e v e l s u f f i c i e n t to
ensure adequate p a r t i c i p a t i o n .
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
48
51
52
Option 3: Provide a l l s t a t e s with the option of
expanding Medicaid coverage, with f e d e r a l l y matched
s t a t e funding, to a l l i n d i v i d u a l s with HIV i n f e c t i o n or
AIDS with incomes below the f e d e r a l poverty l e v e l and
meeting the SSI a s s e t t e s t .
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
53
56
57
Option 4; Mandate Medicaid to pay COBRA h e a l t h
insurance premiums for low-income persons w i t h HIV
d i s e a s e who have l e f t t h e i r jobs and cannot a f f o r d to
pay the h e a l t h insurance premium.
1.
2.
3.
Impact
Savings
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
iv
57
59
60
�C.
Medicare
60
Option 5: Permit S o c i a l S e c u r i t y D i s a b i l i t y Insurance
(SSDI) b e n e f i c i a r i e s with AIDS to purchase Medicare
during the two year w a i t i n g period. Require Medicaid
to purchase Medicare coverage for poor SSDI
beneficiaries.
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
60
63
63
Option 6: Allow a l l i n d i v i d u a l s with AIDS to purchase
Medicare. For i n d i v i d u a l s with incomes below the
f e d e r a l poverty l e v e l Medicaid would pay the Medicare
premiums, deductibles and coinsurance.
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
64
65
65
Option 7: E l i m i n a t e the current two-year w a i t i n g period
f o r SSDI b e n e f i c i a r i e s with AIDS to r e c e i v e Medicare.
Medicaid supplements Medicare coverage for poor SSDI
beneficiaries.
1.
2.
3.
D.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
P r i v a t e Health Insurance
66
68
68
68
Option 8; Reform of employer provided group h e a l t h
insurance b e n e f i t s to p r o h i b i t : s e t t i n g higher premiums
f o r persons b e l i e v e d to be a t r i s k f o r AIDS; l i m i t i n g
b e n e f i t s on the b a s i s of HIV d i s e a s e d i a g n o s i s ;
e s t a b l i s h i n g w a i t i n g periods f o r coverage or pree x i s t i n g c o n d i t i o n under employer-provided groups
h e a l t h b e n e f i t s ; or r e f u s i n g to i s s u e or renew coverage
on grounds of r i s k f o r HIV d i s e a s e .
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment of non-HIV Disease
Disabled Populations
68
70
70
�E.
I n c r e a s e i n P r o v i d e r Funding
70
O p t i o n 9: I n c r e a s e a p p r o p r i a t i o n s t o t h e f u l l
a u t h o r i z e d l e v e l under t h e Ryan White Comprehensive
AIDS Resources Emergency (CARE) A c t o f 1990.
1.
2.
F.
Impact
Cost
70
73
Drugs
75
O p t i o n 10: The f e d e r a l government s h o u l d u n d e r t a k e
t h r o u g h t h e Department o f H e a l t h and Human S e r v i c e s a
c o n s o l i d a t e d purchase and d i s t r i b u t i o n o f drugs used i n
t h e p r e v e n t i o n and t r e a t m e n t o f HIV d i s e a s e .
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment o f non-HIV Disease
Disabled Populations
75
78
78
O p t i o n 1 1 : Reform o f t h e Orphan Drug A c t w i t h a s a l e s
and/or a p r o f i t cap.
1.
2.
3.
Impact
Cost
E q u i t a b l e Treatment o f non-HIV Disease
Disabled Populations
78
80
80
O p t i o n 12: Place a p r i c e c e i l i n g on drugs used i n t h e
t r e a t m e n t o f HIV d i s e a s e .
1.
2.
3.
VI.
Impact
Cost
E q u i t a b l e Treatment o f non-HIV Disease
Disabled Populations
Summarv and Conclusions
A.
U n i v e r s a l H e a l t h Insurance
B.
M e d i c a i d Expansion
C.
Medicare Expansion
D.
P r i v a t e H e a l t h Insurance Reform
E.
I n c r e a s e i n P r o v i d e r Funding
F.
Drugs and HIV Vaccine
G.
Conclusion
BIBLIOGRAPHY
80
81
81
81
82
85
86
87
87
88
88
90
vi
�TABLES
1.
Projected numbers of acquired immunodeficiency syndrome
(AIDS) cases, deaths, and livning persons with AIDS,
United States, January, 1989-December, 1993 . . .
101
2.
AIDS cases, case-fatality rates, and deaths by halfyear and age group, United States, through October
1990
102
3.
Projected numbers of acquired immunofeficiency syndrome
(AIDS) cases, by risk-behavior group, United States,
1989-1993
103
4.
Vaccine Costs in 1991 Dollars
APPENDIX A:
104
Assumptions and Data Sources for Cost Estimates of
Options
105
vii
�FINANCING HEALTH CARE FOR PERSONS WITH HIV DISEASE:
POLICY OPTIONS
The gaps in the United States health care financing system
have become increasingly evident with the Human Immunodeficiency
Virus (HIV) epidemic.
Treatment of HIV disease i s costly from
the e a r l i e s t stages and often proves to be an unbearable expense
even to those fortunate enough to have health care insurance.
The disease i s disproportionately represented among poor and
minority groups, who are at greater r i s k of being among t h i s
nation's uninsured.
High treatment costs cause the uninsured to
suffer unnecessarily as they delay seeking care, and threatens to
render those uninsured or underinsured
destitute.
who do seek care
I t i s creating an intolerable financial burden on
many health care providers who are attempting to respond to the
need for care, even to those who are unable to pay.
Unfortunately,
these health care financing problems are not
unique to the HIV disease epidemic.
Individuals without adequate
health insurance face similar problems in seeking treatment
regardless of t h e i r particular health condition.
While the primary solution to t h i s problem i s the enactment
of universal health insurance, i t i s u n r e a l i s t i c to assume that
t h i s w i l l ensure timely r e l i e f .
More modest steps must be taken
during the interim to close the gaps i n health care financing for
those with HIV disease and others who are chronically i l l and
experience catastrophically expensive health care.
To a s s i s t with the policy debate over health care financing,
t h i s report provides a summary of the current health care
�f i n a n c i n g system and h i g h l i g h t s gaps i n the p r o v i s i o n of h e a l t h
care f i n a n c i n g as experienced by i n d i v i d u a l s with HIV d i s e a s e .
I t s e t s f o r t h a number of options with the o b j e c t i v e of extending
current h e a l t h care financing coverage to more people and
improving the b e n e f i t s provided.
These options may be
implemented s o l e l y f o r the HIV d i s e a s e population,
implemented incrementally
or they may be
f o r a l l persons with s e r i o u s chronic
i l l n e s s e s r e q u i r i n g expensive r e c u r r i n g c a r e .
The report
embraces the concept of comprehensive reform of the U.S. h e a l t h
care system and the implementation of shorter-term
expansions of
p u b l i c programs as q u i c k l y as p o s s i b l e .
I.
The Economics of HIV Disease
A.
Population
The Centers
i n Need
f o r Disease Control
(CDC) has monitored the HIV
epidemic s i n c e 1981 and CDC f i g u r e s on new i n c i d e n t c a s e s ,
estimated
prevalence
of a l l l i v i n g cases, p r o j e c t e d future c a s e s ,
and HIV morbidity and m o r t a l i t y have become standard
information.
Accordingly,
i n t h i s report we w i l l use CDC's
f i g u r e s and estimates wherever a p p l i c a b l e .
must be noted, remain approximations.
estimates t h a t the reported
between 70 t o 90 percent
1991b).
percent
sources of
These f i g u r e s , i t
For example, the CDC
f i g u r e s on AIDS m o r t a l i t y
represent
of the t r u e number of deaths (CDC,
Adjustments f o r underreporting
use an assumption of 85
r e p o r t i n g of t o t a l AIDS cases as a standard
(CDC, 1990a).
Over one m i l l i o n Americans a r e c u r r e n t l y HIV-infected, but
the HIV d i s e a s e has not y e t advanced t o a c l i n i c a l d i a g n o s i s of
�AIDS.
An additional estimated 111,000 to 122,000 persons were
l i v i n g with AIDS during 1990 (see Table 1) (CDC, 1990a).
(This
report uses the term HIV disease to refer to both those who are
HIV-positive but do not yet have a c l i n i c a l diagnosis of AIDS, as
well as those with AIDS.
I t uses the term AIDS only when i t i s
referring to those with advanced HIV disease who meet the CDC
definition of AIDS.
As t h i s report i s written, CDC i s changing
the c l i n i c a l definition of AIDS to include persons with CD4s
below 200 cu/mm3 counts below 200; numbers included are based on
the old definition.)
New cases are also being steadily reported.
As shown in
Table 1, new AIDS cases diagnosed i n 1990 are estimated to be
52,000 to 57,000, with adjustment for underreporting.
The net
effect of new cases less deaths among persons with AIDS yields a
steadily increasing prevalence of the disease. This number w i l l
grow to between 127,000 and 153,000 by the end of 1991, and to
between 151,000 and 225,000 by the end of 1993 (see Table 1 ) .
CDC reports approximately 100,000 diagnosed deaths from AIDS
as of October 1990 (see Table 2).
CDC estimates that AIDS deaths
are underreported by 10 to 30 percent.
Nearly a third of a l l
AIDS deaths (31,196) were reported i n 1990, making AIDS the
second leading cause of death for American men aged 2 5 to 44
years i n that year.
Current estimates of the average
life
expectancy of persons with AIDS after diagnosis i s 15 months
(Hellinger, 1990b).
However, new advances i n treatment and the
growing number of pediatric cases with a longer l i f e
expectancy
�make estimates of the number of persons with AIDS requiring
health care services during a year extremely d i f f i c u l t to
estimate accurately.
The total number of Americans infected with HIV i s even more
problematic.
Seroprevalence studies have never been done on a
national basis.
CDC estimates that approximately one million
individuals are currently HIV infected.
However, estimates range
from a low of 700,000 to a high of 1.5 million (CDC,
1990a).
These estimates are affected by the incidence of new cases.
estimates that at least 80,000 new
adults, and 1,500
newborns (CDC,
CDC
infections per year occur in
to 2,000 new infections per year occur among
1990a).
More recent work by Brookmeyer suggests
that the infection rate has slowed to 60,000 to 67,000 annually
(Brookmeyer, 1991).
CDC's HIV prevalence estimates are derived from methods of
extrapolation and of back calculation (CDC,
Brookmeyer, 1988).
1990a and Gail and
The l a t t e r has also provided f a i r l y accurate
short term projections of new AIDS cases.
Projections of AIDS
cases to 1993 are based on observed AIDS incidence and an
estimation of incubation time (from HIV infection to c l i n i c a l
AIDS).
These estimates have been adjusted for unreported cases.
More problematic, however, i s the effect of early intervention on
the incubation time to c l i n i c a l AIDS.
Thus, projections beyond
1990 may be l e s s accurate than e a r l i e r estimates.
Long term follow-up suggests that nearly a l l of these
infected individuals w i l l eventually progress to AIDS, despite
�current a n t i - r e t r o v i r a l therapy.
However, findings from the San
Francisco Cohort study suggest that about 11 percent of persons
infected with HIV are healthy 10 or more years later (Rutherford
et a l . , 1991).
The median incubation period from HIV infection
to AIDS has steadily increased and i s now estimated at 11 years,
with a range of 6 months to 24 years (Gail and Brookmeyer, 1988).
HIV infection remains highly correlated with certain high
r i s k behaviors and subpopulations, but the r e l a t i v e r i s k s within
those populations have changed considerably in the l a s t four
years.
From 1981 to 1986 approximately 17 percent of cases were
intravenous drug users (IVDUs), while 65 percent were
homosexual/bisexual
men
(CDC, 1990a).
Other cases include
heterosexual transmission, blood transmission, and perinatal
transmission.
By 1990 these percentages were 25 percent IVDUs
and 67 percent homosexual/bisexual
homosexual/bisexual
men
(including 5 percent
men who are also IVDUs) (CDC, 1991c).
This
s h i f t toward a higher fraction who are IVDUs i s projected to
continue (see Table 3).
homosexual/bisexual
By 1993, CDC projects that
men w i l l account for 54 percent of a l l AIDS
cases while IVDUs w i l l represent 28 percent of cases.
Rates of
new infection continue to r i s e with the exception of
homosexual/bisexual
men,
where new infection rates have
apparently slowed since 1987.
Since both IVDUs and homosexual/bisexual
men tend to l i v e in
s p e c i f i c urban centers, the distribution of AIDS cases i s
markedly uneven across the U.S.
Five states (New York,
�C a l i f o r n i a , New
J e r s e y , F l o r i d a and Texas) account f o r 64 percent
of a l l known c a s e s as of March 1991
e s p e c i a l l y New
(CDC,
1991a).
Major c i t i e s ,
York, San F r a n c i s c o , Los Angeles, Newark, and
Miami, account f o r l a r g e percentages of c a s e s i n these s t a t e s .
The burden of AIDS cases i s thus h i g h l y unevenly
B.
distributed.
Current Estimates of the Cost of Caring f o r Persons with HIV
Disease
In estimating the cost of HIV d i s e a s e , i t i s u s e f u l to make
separate c o s t estimates for those with AIDS and f o r those with
HIV i n f e c t i o n , but without a c l i n i c a l d i a g n o s i s of AIDS.
Both
the h e a l t h care needs and the numbers of persons a f f e c t e d are
s u b s t a n t i a l l y d i f f e r e n t f o r the two subpopulations.
At a minimum
an i n d i v i d u a l with HIV i n f e c t i o n would need t h r e e ambulatory
v i s i t s a year and laboratory t e s t s .
New
e f f e c t i v e i n delaying the onset of AIDS.
drugs are a l s o proving
As the d i s e a s e
progressed to AIDS the i n d i v i d u a l would need a t l e a s t s i x
ambulatory v i s i t s , on average one to two h o s p i t a l i n p a t i e n t
s t a y s , l a b o r a t o r y work and p r e s c r i p t i o n drugs.
person may
E v e n t u a l l y , the
a l s o need long term care and home c a r e .
The types of
s e r v i c e s t h a t w i l l be needed by a person with HIV i n f e c t i o n or
AIDS w i l l change as new d i s c o v e r i e s y i e l d information on
e f f e c t i v e treatment f o r p e d i a t r i c AIDS c a s e s as w e l l as a d u l t s
and as l i f e expectancy i n c r e a s e s .
T h i s i s l i k e l y to i n c r e a s e the
need f o r housing, home care, other long term care, and c h r o n i c
care (Green, 1990).
�1.
The Health Care Costs of AIDS
The l a t e s t estiinates of the costs of AIDS are from
Hellinger, and were presented at the International Conference on
AIDS i n Florence i n June, 1991 (Hellinger, 1991).
Hellinger
estimated that i t cost $32,000 a year to treat a person with AIDS
in 1990.
Of the t o t a l , $24,000 was for inpatient hospital
services, $4,000 for prescription drugs, and $4,000 for other
services, mostly outpatient.
For the purpose of t h i s analysis,
Hellinger's 1990 estimates were increased by 10 percent to adjust
for i n f l a t i o n and obtain the 1991 estimated cost of AIDS of
$35,200.
Since an estimated 85,000 are l i v i n g with AIDS i n mid-
1991, t h i s yields an estimated total cost of care for persons
with AIDS of $3 b i l l i o n .
These estimates are much lower than even Hellinger's
previous estimates.
The costs of medical treatment of AIDS have
been decreasing due to prescription drugs such as zidovudine
(AZT) and aerosol pentamidine, which reduce hospitalizations.
Last year, Hellinger estimated that the yearly medical care costs
were $51,200 i n 1989 dollars (Hellinger 1990a).
Previously, h i s
estimates were $60,000 a year i n 1988 dollars (Hellinger,
1990b).
Hay et a l . estimated that the lifetime medical care costs of
AIDS was $60,000 in 1987 but would decrease to $35,000 ( i n 1987
dollars) i n 1991 (Hay, Osmond and Jacobson,
1988).
They based
t h i s prediction on an outpatient-oriented approach to the
treatment of patients i n the San Francisco area, and assumed that
�the nation's health care system would soon adopt such "costsaving" methods of treatment.
A few other estimates are widely quoted.
The Coolfont
report from the Public Health Service (PHS) reported a t o t a l AIDS
care cost between $8 and $16 b i l l i o n dollars i n 1991 (PHS, 1986).
The cost for treating a patient with AIDS was $48,000 (1991
dollars) for the low range estimate and for the higher range the
treatment cost was doubled.
Bellinger's e a r l i e r a r t i c l e using a
lifetime medical care cost of $60,000 dollars (1988 dollars)
yielded a total AIDS care cost estimate of $6.0 b i l l i o n for
persons diagnosed i n 1991 (Hellinger, 1988b).
Using more recent
estimates of the cost per person and number of cases, he
currently estimates a 1991 cost of $5.8 b i l l i o n (in 1990 dollars)
(Hellinger, 1991).
Scitovsky and Rice estimated the total AIDS medical care
cost to be $8.5 b i l l i o n i n 1991 (in 1991 dollars) (Scitovsky and
Rice, 1987).
Their estimate d i f f e r s from Bellinger's, as they
used prevalence based data and included the cost of treating
persons with AIDS diagnosed during previous years who received
patient care during that year, while Hellinger used incidence
based data.
Scitovsky and Rice also estimated that there would
be 172,800 AIDS care cases i n 1991 at a $50,000 yearly cost of
care (Scitovsky and Rice, 1987).
The widely varying estimates included i n the l i t e r a t u r e and
the rapidity with which estimates are changed suggest
considerable caution i n using any given cost estimate.
8
Further,
�cost estiinates used i n t h i s report may need to be revised at a
l a t e r date to r e f l e c t the changing nature and recommended
treatment of HIV disease. They may need to be adjusted for
pediatric cases, which may have a 20 percent higher cost of care
per year (Parrott, 1991).
An adjustment should also be made for
the increasing population of intravenous drug users (IVDUs) who
are becoming HIV positive.
The IVDU sub-group tends to be much
sicker and have a higher cost of care per year due to other
s o c i a l and economic problems and a generally poor medical
condition, as opposed to the homosexual/bisexual
cohort who often
tend to have stronger support services, and outpatient treatable
diseases (e.g., Kaposi's sarcoma) (Kelly, Ball and Turner, 1989).
In addition, many of the current cost estimates are based on the
San Francisco data base, which has a strong s o c i a l support
system, and "cost-saving" strategies for AIDS intervention.
Also, the fact that AIDS patients are l i v i n g longer with AZT
should be taken into account.
Moore and Scitovsky have both
conducted studies which indicate that individuals with AIDS who
have received zidovudine have a longer survival time.
The
Scitovsky study showed these individuals lived an average of 7.4
months longer (Scitovsky et a l . , 1990).
A Maryland study found
that the median survival was 19 months longer with the use of AZT
(Moore et a l , 1991).
Most important, the t o t a l cost figures
should be based on prevalence-based data, not incidence-based
data.
�2.
The Health Care Costs of HIV Infection
The cost of treating HIV positive individuals using current
treatment methods can be estimated from an Arno study which
showed a mid-range estimate for monitoring HIV seropositivity of
$528, and annual treatment costs of $5,094 (including drug costs
of $2,700) (Arno, 1990).
Arno estimates there are 800,000
seropositive individuals a l l of whom would benefit from early
intervention to assure appropriate
monitoring.
testing, counseling, and
Approximately 60 percent of the seropositive
population are indicated for treatment, those with CD4+ counts of
l e s s than 500 (CDC, 1990a).
In the f i r s t stages of a national
early intervention program, a demand model estimates that 23
percent of t h i s population would use early intervention
treatments leading to a total cost of $1.2 b i l l i o n during the
f i r s t year (Arno, 1990).
This cost could be expected to increase
over time as a much greater proportion of HIV positive
individuals needing treatment get into the program (e.g. 60
percent).
However, these cost figures could be s i g n i f i c a n t l y
decreased i f drug prices were to f a l l or i f a cap were placed on
drug prices.
For the purpose of t h i s analysis, Arno's estimates
were increased by 10 percent, to adjust for i n f l a t i o n .
This gave
an average cost of $2,754 for the monitoring and treatment of
individuals with HIV infection for 1991.
10
�II.
Health Financing f o r Persons With HIV Disease:
The Current
System
The major sources of financing f o r persons w i t h HIV disease
include p r i v a t e health insurance coverage, Medicare and Medicaid.
The m i l i t a r y and Veterans A d m i n i s t r a t i o n are also sources of
p u b l i c l y - f i n a n c e d health care —
t h i s report.
but w i l l not be addressed i n
These p u b l i c and p r i v a t e insurance programs are
a v a i l a b l e t o i n d i v i d u a l s meeting a v a r i e t y of e l i g i b i l i t y
criteria.
For those without insurance or ready access t o care from the
Veterans A d m i n i s t r a t i o n , m i l i t a r y health system, or other
r e s t r i c t e d sources, the cost of drug treatment or health services
can pose a serious f i n a n c i a l burden.
s e l f - f i n a n c e t h e i r own care.
Such persons must o f t e n
Other sources of f i n a n c i n g f o r
uninsured persons w i t h HIV disease include targeted funding from
p u b l i c or p r i v a t e agencies and c h a r i t y or reduced cost care from
selected providers.
The Ryan White Comprehensive AIDS Resources
Emergency (CARE) Act provides l i m i t e d f e d e r a l funding f o r h e a l t h
care services. State and l o c a l governmental agencies as w e l l as
n o n p r o f i t o r g a n i z a t i o n s also provide assistance i n some
communities.
Public h o s p i t a l s and teaching h o s p i t a l s are o f t e n a
provider of l a s t resort —
w i l l i n g t o provide care t o those i n
need even when payment i s not possible.
A.
Health Insurance Coverage: An Overview
While f i r m estimates of insurance coverage are not
a v a i l a b l e , t h e most recent estimates i n d i c a t e t h a t Medicaid
11
�covers 40 percent of individuals with AIDS, Medicare 2 percent,
private health insurance about 29 percent, and the remaining 29
percent are uninsured (estimates based on HCFA, 1990 and Andrulis
et a l . , 1989).
The absence of nationally representative surveys
of persons with AIDS with information on insurance coverage,
income, and employment status, however, makes such estimates
tentative.
These estimates are roughly consistent with the 1987 US
Hospital AIDS study which showed that 44 percent of inpatient
hospital admissions were paid by Medicaid, 29 percent were paid
by private insurance, 2 percent were paid by Medicare, 2 percent
were prisoners and the remaining 23 percent were self-pay or
other.
However, t h i s study did not include a representative
sample of hospitals and may be misleading (Andrulis et a l . ,
1989) .
Compared with e a r l i e r studies, i t appears that Medicaid's
share of the financial burden i s growing, while that of private
insurance i s declining. A report by The National Center for
Health S t a t i s t i c s showed that publicly funded inpatient care for
AIDS increased from 25 to 41 percent, while privately funded
inpatient care decreased from 49 to 43 percent between 1984
1987
(Green and Arno, 1990).
and
Other studies have indicated that
private health insurance covered 4 0 to 60 percent of t o t a l AIDS
related costs, while Medicaid covered 20 to 30 percent and
Medicare covered 1 to 3 percent (Merlis, 1990).
12
�I t i s unclear i f these figures indicate a s h i f t i n insurance
financing or a change i n the composition of the AIDS population.
The increase i n Medicaid coverage may represent an increase i n
the number of low income individuals with AIDS.
The decline i n
private health insurance coverage may be explained by barriers
set up to prevent individuals at high r i s k for HIV disease from
obtaining private insurance coverage and by the high premium cost
which many, who have contracted the disease, cannot maintain
after the loss of employment.
B.
Private Insurance
Persons with AIDS who do have private health insurance would
t y p i c a l l y qualify for i t as part of employer-provided coverage.
Most large firms provide health insurance to t h e i r workers, and
for the most part a l l employees are e l i g i b l e for coverage
regardless of health condition.
Employer-based coverage i s less available to persons with
AIDS employed i n smaller firms.
Although 90 percent of firms
with 25 to 49 employees have a health plan, only 54 percent of
firms with 5 to 9 employees and 26 percent of firms with fewer
than 5 employees have a health plan (HIAA, 1989).
Even those
firms with health plans may not cover a l l employees, especially
part-time employees.
Many small firms do not offer health
insurance to any workers.
Further, insurance companies implement
a variety of underwriting practices that r e s t r i c t coverage to
persons with s i g n i f i c a n t health problems or health r i s k s employed
by smaller firms.
Employees i n a given firm may be excluded from
13
�coverage, pre-existing conditions may be permanently excluded
from coverage, and premiums may be excessive for any small group
viewed as a significant health r i s k .
The Health Insurance Association of America (HIAA) reports
that the average monthly premium for a conventional employer
health plan (non-HMO) was $119 for an individual and $271 for a
family in 1989
(Gabel et a l . , 1990).
Under such a plan, the
employee may be expected to contribute toward the cost, paying on
average $200 annually toward the premium, a $200 deductible and
up to $1,000 for cost sharing, for single coverage in 1989.
The
amount varies by the employer offering the coverage and the
health care benefits being provided.
The heavy financial burden of providing health insurance for
employees with HIV disease has become a serious concern for
employers providing coverage under group plans.
In companies
where the premium i s based on experience rating or a group's past
medical claims, the prevalence of HIV disease can r e s u l t in
s i g n i f i c a n t l y higher premiums.
Workers in small firms who are not HIV-positive but who
perceived by insurance companies to be at high r i s k may
unable to obtain insurance coverage.
are
also be
Insurance companies may
"redline" certain types of companies, such as the performing
arts, beauty shops, f l o r i s t s and health professionals, and refuse
to write coverage at any premium because they believe employees
of such organizations are more l i k e l y to be at r i s k (IHPP, 1990).
14
�Most larger companies self-insure, rather than purchase
insurance from a private health insurance company. Companies
that s e l f - i n s u r e are exempt state mandated requirements for
coverage of s p e c i f i c services and services provided by s p e c i f i c
providers.
A few of these companies have been known to reduce
health insurance costs by denying employees coverage for HIV
disease, or by setting maximum c e i l i n g s on benefits for care of
persons with HIV disease.
Costly private health insurance practices can undermine the
continued health coverage of persons with HIV disease and
may
lead to employment discrimination as employers become anxious
about the high health care benefit costs associated with
employees with HIV disease.
Without private health insurance,
the only recourse for coverage may be Medicaid.
Even i f the
individual could continue working, he or she may decide not to
work in order to gain and retain Medicaid coverage (Green and
Arno, 1990).
Even i f persons with HIV disease are covered under an
employer health insurance plan, t h i s coverage may be l o s t when
the individual i s unable to continue working.
Consolidated
Under the
Omnibus Reconciliation Act of 1985 (COBRA),
employers with 20 or more employees are required to continue any
employee who
leaves employment and dependents under the group
plan, i f the employee pays the f u l l group premium plus 2 percent.
For those who
leave t h e i r job because of d i s a b i l i t y or i l l n e s s
and receive Social Security D i s a b i l i t y Insurance payments, t h i s
15
�coverage can be continued f o r 29 months, provided t h a t the
i n d i v i d u a l pay 150% of the premium a f t e r the eighteenth month.
However, some persons with AIDS may
be unable to a f f o r d the
full
COBRA premium which can be as high as $2,000 to $2,500 f o r s i n g l e
coverage
annually, and as a r e s u l t they may
drop t h e i r
coverage.
I n response to persons with AIDS l o s i n g p r i v a t e insurance
coverage with employment, e i g h t s t a t e s ( C a l i f o r n i a ,
Colorado,
Connecticut, Maryland, Michigan, Minnesota, Texas, and
Wisconsin)
and the D i s t r i c t of Columbia have taken steps to cover these
premiums with s t a t e funds, although most are p i l o t programs for
low-income persons
(IHPP,
1991).
An even l e s s adequate a l t e r n a t i v e to p r i v a t e group insurance
i s i n d i v i d u a l coverage.
I n d i v i d u a l l y - p u r c h a s e d h e a l t h insurance
accounts f o r about 10 percent of a l l insurance coverage
general population
i n d i v i d u a l s who
(HIAA, 1990).
f o r the
I t i s r a r e l y an option f o r
already have AIDS or are HIV p o s i t i v e .
As with
any other c h r o n i c medical condition, the insurance i n d u s t r y i s
a l e r t to the heavy c o s t i m p l i c a t i o n s of t r e a t i n g i n d i v i d u a l s with
HIV d i s e a s e .
Insurance companies, p a r t i c u l a r l y those o f f e r i n g
i n d i v i d u a l coverage,
practices.
have responded with s t r i n g e n t underwriting
The insurance underwriters w i l l s e t the p r i c e of the
premium or r e f u s e coverage based on a medical h i s t o r y or p h y s i c a l
examination
and the p o t e n t i a l medical c o s t s to be accrued.
An
i n d i v i d u a l with an AIDS d i a g n o s i s i s a u t o m a t i c a l l y defined as
being "uninsurable" and t h i s d e f i n i t i o n has been extended by some
companies to i n c l u d e a l l stages i n the p r o g r e s s i o n of the
16
�disease.
Twenty-two of the 74 Blue Cross and Blue S h i e l d Plans
have open enrollment programs t h a t accept a p p l i c a n t s with HIV
d i s e a s e but may
r e q u i r e more c o s t sharing and often are more
expensive f o r young a d u l t s than other i n d i v i d u a l p o l i c i e s
(Consumer Reports, 1990).
Even i n d i v i d u a l s who
are not HIV p o s i t i v e may
find
themselves f a l l i n g i n a category t h a t insurance companies r e f u s e
to cover i n c l u d i n g m a r i t a l s t a t u s , p l a c e of r e s i d e n c e , and
occupation.
T h i s approach to r e f u s i n g coverage may
screening out i n d i v i d u a l s who
result in
are not a t high r i s k of developing
the d i s e a s e (Merlis, 1990).
Even i f a person with HIV d i s e a s e were to obtain i n d i v i d u a l
insurance, p r e - e x i s t i n g condition c l a u s e s are used by insurance
companies to exclude or delay coverage f o r any c o n d i t i o n e x i s t i n g
a t the time insurance begins.
Waiting periods range from s i x
months to two y e a r s f o r any c o n d i t i o n s r e q u i r i n g treatment or
showing symptoms i n the l a s t one to two y e a r s or anytime i n the
past (Consumer Reports, 1990).
Therefore, most persons with HIV
d i s e a s e could be excluded completely.
Blue Cross and Blue S h i e l d
Plans often c r e d i t continuous enrollment under any other Blue
Cross or Blue S h i e l d c o n t r a c t towards the w a i t i n g period.
C.
Medicaid
Medicaid i s c u r r e n t l y the most important source of f i n a n c i n g
f o r HIV d i s e a s e (HCFA, 1990).
I t i s estimated i n 1990 t h a t i t
covered 40 percent of the persons with AIDS, i n c l u d i n g 90 percent
of c h i l d r e n with AIDS (HCFA, 1990 and IHPP, 1990).
17
These f i g u r e s
�may be expected to increase with an increasing incidence of the
disease in Hispanic and black populations, who are more l i k e l y to
be low income than whites (Green and Arno, 1990).
Although Medicaid i s the most important source of financing
for individuals with HIV disease, i t s t i l l f a l l s short of meeting
the needs of even low income persons.
Many poor individuals are
not e l i g i b l e , including those who do not meet the stringent lowincome and asset c r i t e r i a and those with HIV disease who are not
c l i n i c a l l y diagnosed as "disabled." The requirement of a
c l i n i c a l diagnosis of AIDS i s p a r t i c u l a r l y limiting to coverage
of persons in the early stages of HIV disease.
These individuals
are not e l i g i b l e for Medicaid coverage of early intervention
treatments even i f they are destitute.
This makes i t extremely
d i f f i c u l t for low-income persons to receive early testing,
counseling, monitoring, and treatment essential to prevent
serious i l l n e s s e s from developing.
Medicaid spent an estimated $1.3 b i l l i o n on HIV-related
health care benefits in f i s c a l year 1990: $670 million in Federal
funds and $630 million in State funds.
This represents two
percent of t o t a l Medicaid expenditures (HCFA, 1990).
These
combined expenditures are expected to increase to j u s t under $3
b i l l i o n by 1993 (HCFA, 1990).
Medicaid i s a federal-state program, which varies widely, by
state, both i n the e l i g i b i l i t y c r i t e r i a for individual coverage
and the types of benefits provided.
The variation i n the
e l i g i b i l i t y c r i t e r i a i s evident in a 1987 hospital survey which
18
�showed that in the Northeast, 54 percent of AIDS patients were
Medicaid e l i g i b l e at the time of admission, while in the South
only 18 percent were Medicaid e l i g i b l e (Andrulis, et a l , 1989).
This variation arises because states have a degree of autonomy in
determining, within federal guidelines, the e l i g i b i l i t y
requirements and the benefits to be covered.
A l l states,
however, are, required to provide Medicaid to persons receiving
cash assistance under Aid to Families with Dependent Children
(AFDC), and most states also cover a l l persons receiving
assistance under the Supplemental Security Income (SSI) program
(HCFA, 1988).
The f i s c a l pressures on states to r e s t r i c t Medicaid funding
have made both the number of individuals and the types of
benefits covered issues of immediate concern.
The Medicaid
program i s designed to provide medical care coverage to lowincome women and children and low-income elderly, blind, or
disabled people rather than to individuals with a s p e c i f i c
disease such as HIV disease.
This has meant that individuals
with HIV disease must generally meet both the low income
e l i g i b i l i t y c r i t e r i a and other categorical requirements such as
disability.
Women and children with AIDS meeting state-established AFDC
income and asset requirements, would be covered by Medicaid under
AFDC.
The majority of Medicaid recipients with HIV disease,
however, receive coverage under SSI.
With a c l i n i c a l
diagnosis
of AIDS, they are considered "presumptively disabled" and
19
�contingent upon the individual meeting income and asset t e s t s ,
they would qualify for Medicaid under t h i s category.
The general
income l i m i t s for individuals applying for SSI are up to $5,124
in unearned income, or 77% of the federal poverty l e v e l and up to
$10,777 i n earned income, or 163% of the poverty l e v e l for an
individual (SSA, 1991).
States can supplement the SSI payments
which would also increase the income l i m i t s .
The general assets
l i m i t s are $2,000 in cash or other l i q u i d assets, one personal
residence, and a car.
Thirty-six states have accelerated
e l i g i b i l i t y procedures for individuals qualifying for SSI, while
there are s t r i c t e r financial c r i t e r i a in the remainder (IHPP,
1990).
States may optionally provide Medicaid coverage through the
medically needy program.
Under t h i s program Medicaid coverage
may be extended to individuals who cannot finance burdensome
medical expenses, even though t h e i r incomes and resources may be
above the l i m i t s allowed for AFDC or SSI e l i g i b i l i t y .
This
coverage would generally be extended to individuals with HIV
disease whose medical care costs have caused t h e i r income net of
medical expenses to f a l l below the income e l i g i b i l i t y l e v e l ( i . e .
they qualify by "spending down" to coverage).
T h i r t y - f i v e states
and the D i s t r i c t of Columbia cover medically needy persons (HCFA,
1990).
Of the f i f t e e n states with the highest number of AIDS
cases, 12 have medically needy programs for the aged, blind,
disabled, families, pregnant women and certain children.
Texas
and Georgia only cover pregnant women and children in t h e i r
20
�medically needy programs.
Ohio does not have a medically needy
program per se, but does have a "spend-down" program for SSI
recipients.
Medically needy income levels vary by state and
be lower than the state SSI l e v e l s .
can
Fifteen states provide
prescription drugs to their categorically needy recipients but
not to the medically needy, and four states do not provide
hospice services to the medically needy (HCFA, 1990).
There i s also another state option to extend f u l l Medicaid
coverage to Medicare disabled persons with income l e v e l s up to
100 percent of poverty.
Thirteen states have chosen t h i s option.
Out of the fifteen states with the highest number of AIDS cases,
New
Jersey, Florida, Pennsylvania, Michigan, and Massachusetts
allow Medicare disabled poor to obtain Medicaid.
The extent of medical care services covered by Medicaid
under the categorical and medically needy programs varies by
state, both in the types and quantity of services provided.
The
minimum benefits package that States are required to provide to
a l l Medicaid beneficiaries must include hospital inpatient
and
outpatient services, physician services, s k i l l e d nursing f a c i l i t y
care, laboratory and x-ray services, health screening and
up services for children and supplies, and rural health
services (HCFA, 1990).
these services, they may
follow-
clinic
Although states are required to provide
l i m i t the services provided, for
example, by only covering a set number of inpatient days or
physicians v i s i t s , requiring a copayment for a service or setting
a cap on the t o t a l service cost covered (HCFA, 1988).
21
Some of
�these l i m i t s can be exceeded i f the s e r v i c e s a r e medically
necessary.
Medicaid s e r v i c e s o p t i o n a l l y provided by the s t a t e s include
c l i n i c s e r v i c e s , p r e s c r i p t i o n drugs, miscellaneous
s e r v i c e s , s k i l l e d nursing, intermediate
for
diagnostic
care and home h e a l t h care
i n d i v i d u a l s under twenty-one, personal care, case
and hospice care (HCFA, 1990).
management
The most frequently o f f e r e d
optional s e r v i c e s include p r e s c r i b e d drugs,
s e r v i c e s , c l i n i c s e r v i c e s , and intermediate
optometrists
care
1
facility
s e r v i c e s , while the l e a s t frequently o f f e r e d included hospice and
case management s e r v i c e s (HCFA,
1990).
Coverage of expensive p r e s c r i p t i o n drugs i s p a r t i c u l a r l y
important f o r i n d i v i d u a l s with HIV d i s e a s e , because they a r e key
to p r o p h y l a c t i c treatments
disease.
which delay t h e progression
of t h e
S t a t e s have the option of covering p r e s c r i p t i o n drugs.
A l l provide minimum coverage f o r zidovudine (AZT), g a n c i c l o v i r ,
a c y c l o v i r , septra/bactrim,
alpha i n t e r f e r o n and a e r o s o l i z e d
pentamidine f o r AIDS p a t i e n t s (HCFA, 1990) although most p r o h i b i t
coverage of experimental
drugs.
However, v a r i a t i o n by s t a t e i n
the p r o v i s i o n of p r e s c r i p t i o n drugs include l i m i t s on t h e
quantity, c o s t and number of r e f i l l s
(IHPP, 1990),
and some
s t a t e s do not cover drugs such as fluconazole, e r y t h r o p o i e t i n and
s u l f d o x i n e / pyrethamine (IHPP,
1990).
S t a t e Medicaid programs may a l s o extend Medicaid coverage,
s p e c i f i c a l l y t o Medicaid r e c i p i e n t s with HIV d i s e a s e , by applying
for
the f e d e r a l s e c t i o n 2176 waivers t o provide home and
22
�community-based long-term care services. These waivers are
approved for a three year period and are only approved i f states
can show that the benefit w i l l not add to program costs (HCFA,
1990).
Ten states (California, Florida, Hawaii, Missouri, New
Jersey, New Mexico, Pennsylvania,
Ohio, South Carolina, and
Washington) have received AIDS home and community-based waivers
in order to provide home and community-based services such as
case management, foster care, private duty nursing, and personal
care.
Two states ( I l l i n o i s and North Carolina) provide home and
community-based services to broader groups of disabled persons,
including persons with AIDS.
Two additional Medicaid concerns, apart from the patchwork
of benefits being provided to a select group with HIV disease,
are low provider reimbursement rates and disproportionate
f i n a n c i a l burdens on s p e c i f i c state Medicaid programs.
The low
reimbursement rates are p a r t i a l l y responsible for the practice of
referring Medicaid patients with AIDS to public and teaching
hospitals (Merlis, 1990).
This has put a serious financial
burden on hospitals i n areas with a high prevalence of HIV
disease such as C a l i f o r n i a and New York.
Low physician
reimbursement rates may lead to reduced participation of o f f i c e based physicians i n the provision of care to AIDS patients, which
may i n turn be reflected in the quality of primary care provided
to individuals with HIV disease (Green and Arno, 1990). I t
should be noted, however, that many office-based physicians may
be reluctant to t r e a t persons with HIV disease regardless of
23
�insurance s t a t u s .
Emergency rooms and h o s p i t a l o u t p a t i e n t
departments o f t e n serve as a usual source of primary care
and Arno, 1990).
(Green
Reliance on h o s p i t a l s as a source of primary
care i s also a f u n c t i o n of the undersupply of primary care
physicians i n i n n e r - c i t y areas w i t h a geographical c o n c e n t r a t i o n
of HIV disease p a t i e n t s .
The f i n a n c i a l burden of p r o v i d i n g HIV disease h e a l t h care
b e n e f i t s under Medicaid i s becoming much more s i g n i f i c a n t i n
States where there are more people w i t h the disease, such as
New
York or C a l i f o r n i a . I t has been estimated t h a t approximately onet h i r d of a l l AIDS cases are i n New York C i t y , San Francisco and
Los Angeles (Green and Arno, 1990).
I n New York and C a l i f o r n i a
i t has been estimated t h a t payments f o r AIDS consumed 5 t o 6
percent of t o t a l Medicaid expenditures i n FY 1990
( M e r l i s , 1990).
I n a d d i t i o n t o a d i s p r o p o r t i o n a t e f i n a n c i a l burden on s p e c i f i c
s t a t e Medicaid programs, there i s also concern f o r the burden on
i n n e r - c i t y p u b l i c h e a l t h systems (Green and Arno, 1990).
Under p r o v i s i o n s of OBRA 1990, Medicaid i s funding two
demonstrations f o r HIV-positive persons w i t h an a u t h o r i z a t i o n of
$30 m i l l i o n .
The o b j e c t i v e of the demonstrations i s t o compare
costs of t r e a t i n g HIV-positive persons a t an e a r l y stage
contrasted w i t h those t r e a t e d a t a l a t e r stage.
A broad range of
services beyond the standard Medicaid b e n e f i t package w i l l
be
a v a i l a b l e t o 200 p a r t i c i p a n t s meeting s t a t e income and asset
requirements f o r Medicaid.
24
�D.
Medicare
Medicare finances a r e l a t i v e l y small portion of AIDS health
care benefits totaling an estimated $110 million in federal funds
in FY 1990 or one to two percent of the direct AIDS-related
medical care costs (HCFA, 1990).
I t i s estimated that 2,100
persons with AIDS were Medicare recipients in FY 1990, increasing
to 3,100
in FY 1991 (HCFA, 1990).
The small number of persons with AIDS covered under the
Medicare program i s explained by the e l i g i b i l i t y c r i t e r i a .
Individuals must be either 65 years or age or over, disabled, or
have end stage renal disease, and additionally have a work
history that e n t i t l e s them to social security cash benefits or
payments from the railroad retirement system.
The majority of persons with AIDS become e l i g i b l e for
Medicare when they can no longer work, when they have the
required employment history and they meet the standards to
qualify them for Social Security D i s a b i l i t y Insurance (SSDI).
E l i g i b i l i t y for SSDI i s determined by work experience under
Social Security covered employment.
In general, a person must
work for 20 quarters of the l a s t 40 quarters (10 years).
For the
disabled under age 31, half the quarters elapsed after age 21 are
required with a minimum of s i x quarters.
A person working at the
minimum wage for the l a s t eight years would be e l i g i b l e to
receive $457 in monthly SSDI benefits i f disabled in 1991.
To
receive monthly SSDI benefits above poverty, a person would have
had to earn an average of about $11,000.
25
�Access t o Medicare d i s a b i l i t y coverage i s f u r t h e r l i m i t e d by
a 29 month w a i t i n g period requirement.
A disabled person must
w a i t f o r f i v e months before d i s a b i l i t y cash b e n e f i t s begin and
then must wait an a d d i t i o n a l 24 months t o be e n t i t l e d t o
Medicare.
The o r i g i n a l purpose o f t h i s w a i t i n g period was t o
ensure t h a t only persons w i t h severe and long term d i s a b i l i t i e s
would be e l i g i b l e and thereby p r o t e c t t h e Medicare t r u s t funds
(Bye and R i l e y , 1989).
Once an i n d i v i d u a l i s e l i g i b l e , Medicare w i l l cover
i n p a t i e n t h o s p i t a l care, some i n p a t i e n t s k i l l e d nursing
facility
care, home health care and hospice care under Hospital Insurance
(Part A).
I n d i v i d u a l s have the option o f purchasing
Supplementary Medical Insurance (Part B), by paying t h e premium.
Under Supplementary Medical Insurance t h e i n d i v i d u a l w i l l be
covered f o r physician services, o u t p a t i e n t h o s p i t a l services,
durable medical equipment and other medical services and
supplies.
Both Part A and Part B have deductibles which must be
exceeded before b e n e f i t s begin, and Part B has a coinsurance o f
20 percent o f Medicare's allowable charge f o r covered
physicians' services.
The f i n a n c i n g o f t h e deductibles,
coinsurance, and premiums f o r Medicare p a r t A and p a r t B can
prove t o be a serious f i n a n c i a l
burden f o r i n d i v i d u a l s w i t h AIDS.
I n a d d i t i o n t o the problem o f f i n a n c i n g t h e premium and cost
sharing f o r t h e coverage o f services provided under Medicare, t h e
i n d i v i d u a l w i l l also have t o finance services not covered such as
p r e s c r i p t i o n drugs, dental care, eyeglasses and a v a r i e t y o f
26
�long-term care services which tend to be needed by individuals
with AIDS in the l a t t e r stages of the disease.
For example.
Medicare only covers a limited number of s k i l l e d nursing f a c i l i t y
days.
Certain low income Medicare beneficiaries may be e l i g i b l e
for state Medicaid coverage of the premiums and cost-sharing.
Under recent l e g i s l a t i o n states must cover a l l
Medicare
beneficiaries with incomes below the federal poverty level under
Medicaid and pick up the Medicare premium and cost-sharing.
On a
phased-in basis, states w i l l be required to pay the Medicare
premiums for such beneficiaries up to 120 percent of the federal
poverty l e v e l .
States have the option, but are not required, to
extend to these poor disabled beneficiaries the f u l l Medicaid
benefits such as prescription drugs that are not covered by
Medicare.
E.
Other Health Financing Sources
While private health insurance, Medicaid, and Medicare are
the most important sources of financing care for persons with HIV
disease, they leave about 25 to 30 percent without any health
insurance.
Limitations on benefits can lead to inadequate
coverage even for those with some health insurance. For those who
are uninsured or have inadequate health insurance, some public
support i s available through limited programs.
The most important categorical funding program for services
to persons with HIV disease i s the federal Ryan White
Comprehensive AIDS Resources Emergency (CARE) Act of 1990.
27
The
�Ryan White Act provides
experiencing
emergency r e l i e f t o c i t i e s and s t a t e s
a burden of AIDS cases.
The annual a u t h o r i z a t i o n
l e v e l i s $875 m i l l i o n , although appropriated
funds have f a l l e n
f a r short of the f u l l a u t h o r i z a t i o n amount.
S p e c i f i c a l l y , the funds under the Ryan White Act go f o r : (1)
grants t o c i t i e s for h e a l t h and support s e r v i c e s ; (2) grants t o
s t a t e s f o r comprehensive care programs i n c l u d i n g care c o n s o r t i a ,
home and community-based s e r v i c e s , buy-in COBRA extension of
p r i v a t e insurance coverage, and treatment t o prolong l i f e or
prevent d e t e r i o r a t i o n ; (3) grants t o s t a t e s f o r h e a l t h care
c l i n i c s f o r e a r l y i n t e r v e n t i o n s e r v i c e s ; and (4) demonstration
grants f o r p e d i a t r i c AIDS programs.
S t a t e and l o c a l government agencies
a l s o provide l i m i t e d
funding f o r the care of persons with HIV d i s e a s e .
s t a t e - o n l y non-Medicaid funds contributed
I n FY 1989,
$65 m i l l i o n f o r t h e
p a t i e n t care of i n d i v i d u a l s with HIV d i s e a s e
(IHPP, 1989).
i s a dramatic i n c r e a s e from the $25 m i l l i o n contributed
1988
—
but s t i l l r e l a t i v e l y s m a l l .
I n FY 1989,
This
i n FY
26 percent of
t h i s s t a t e - o n l y funding was spent d i r e c t l y on i n p a t i e n t care,
with 14 percent being spent on outpatient care and j u s t over 11
percent being spent on AZT and case management s e r v i c e s .
Comparisons between s t a t e s of the d i s t r i b u t i o n of funding f o r
d i r e c t p a t i e n t care i n d i c a t e s u b s t a n t i a l v a r i a t i o n (IHPP, 1989).
Some s t a t e s have taken steps t o extend p r i v a t e insurance t o
persons with HIV d i s e a s e under COBRA (IHPP, 1990).
Eight states
and the D i s t r i c t of Columbia have some form of premium paying
28
�program.
Under these programs the states pay health insurance
premiums for individuals with HIV disease who have been forced to
leave employment for health reasons.
The states participating
include California, Colorado, Connecticut, the D i s t r i c t of
Columbia, Maryland, Michigan, Minnesota, Texas and Wisconsin
(IHPP, 1990).
Some of these programs are in the preliminary
stages of being developed and they vary in the way they have been
implemented.
In California, under a p i l o t program for example,
the state w i l l pay the private insurance premium for Medi-Cal
e l i g i b l e AIDS patients (IHPP, 1990).
They estimate expected
savings at $20,000 per person per year.
In Texas, a combination
of hospital d i s t r i c t s , counties and the state Medicaid agency
have been authorized to pay the private insurance premiums for
e l i g i b l e patients (incomes below 200% of poverty) diagnosed with
a terminal or chronic condition.
This would include persons with
HIV disease (IHPP, 1990).
I I I . Additional Health Care Financing
Considerations
A.
Delays and Barriers to Early Intervention and Treatment
1.
Access to Testing
While inadequate insurance coverage may delay or prevent
individuals with HIV disease from obtaining essential medical
care, further delays in care can result when these"*individuals do
not have ready access to early HIV testing or cannot bear the
cost of early drug therapy.
The evidence that early testing and
treatment are not reaching the majority of persons with HIV
disease i s reflected by the fact that the most common
29
�presentation
of HIV disease s t i l l remains Pneumocystis c a r i n i i
pneumonia (PCP), an e s s e n t i a l l y preventable i l l n e s s (Arno, 1990).
Limited HIV testing can lead to major delays in early
diagnosis and treatment.
Delays in undergoing HIV testing occur
in several ways: when individuals have limited access to testing;
when individuals choose not to undergo timely testing because
they believe that t h e i r t e s t r e s u l t s w i l l not be treated in a
confidential manner; or when the t e s t r e s u l t s may
discrimination
lead to
in employment, insurance, and health
care.
Presently, there are no effective federal r e s t r i c t i o n s in these
areas, leaving the regulation of these issues to the discretion
of the states.
In the absence of consistent legal safeguards
against the use of HIV t e s t results and possible
discrimination,
testing w i l l remain a c r i t i c a l issue affecting the early
diagnosis and treatment of HIV
disease.
Persons with HIV disease may
also delay seeking early care
when testing i s not accompanied by adequate pre- and
counseling by trained personnel.
post-test
Such counseling i s e s s e n t i a l i f
patients are to make informed decisions regarding t h e i r diagnosis
and any subsequent therapy.
However, at t h i s time there are not
adequate numbers of properly trained individuals, especially
individuals trained to meet the counseling needs of the
populations experiencing a r i s e in new cases of HIV
disease:
women, children, and IVDUs.
Improving access to early intervention w i l l also f a c i l i t a t e
broader prevention efforts i f proper risk-reduction counseling i s
30
�included as part of testing efforts. This would lead to a
reduction in the number of new cases and ultimately reduce the
overall cost of care related to HIV infection.
2.
Access to Drug Treatments
t
As Arno has pointed out, the major cost (about 90 percent of
the total) i n early intervention i s prescription drugs (Arno,
1991).
While Medicaid pays for most prescription drug costs,
Medicare does not. And for the uninsured, these drug costs,
estimated at approximately $5,000 per patient per year, are
l i k e l y to be prohibitive.
Many private insurers also l i m i t
prescription drug payments. As early intervention prolongs the
"pre-AIDS" period, these drug costs can be expected to mount for
individuals and for other payers.
While a large proportion of the estimated cost of AIDS care
i s for prescription drugs, the majority of costs associated with
early intervention i n HIV disease, i s due to these costs (Arno et
a l , 1988).
An estimation of early intervention costs for New
Jersey's state program found that $9,673 of $10,491 per person
per year, or 92 percent of the t o t a l costs, were due to
prescription drugs, principally AZT (Retrovir) and aerosolized
pentamidine (Hummel et a l . , 1990).
HCFA estimates that at least
80 percent of the prescription drug costs i n the U.S. are paid by
patients d i r e c t l y out-of-pocket, and t h i s percentage i s thought
to be higher for the HIV disease population
(HCFA, 1990).
of t h i s cost i s , as Arno has noted, a r t i f i c i a l .
This cost i s
p r i n c i p a l l y due to patent protection and provisions of the
31
Much
�Federal Orphan Drug Act of 1983 (P.L. 101-239) (Arno, et a l ,
1989) .
The Orphan Drug Act was o r i g i n a l l y intended to protect
pharmaceutical manufacturers from losses incurred in the
development of drugs for rare diseases.
The law allows the
manufacturer of such a drug an exclusive marketing license for
seven years, offers a variety of research support grants, and a
series of tax credits and tax deductions which have been
estimated to reduce losses on c l i n i c a l t r i a l s by as much as 70
percent (Merlis, 1990).
Burroughs Wellcome, the maker of AZT,
has marketed i t s drug under the monopoly granted by the Orphan
Drug Act in 1985 and a 17 year patent granted by the U.S. patent
office in 1988.
The cost of AZT in 1987 was $10,000 per year.
Burroughs Wellcome l a t e r agreed to successive price reductions
partly as a result of pressure from AIDS a c t i v i s t s .
Since 1989
lower doses of the drug have been used, and lower dose regimens
have been approved for early intervention, making the annual cost
of AZT between $2,200 to $2,800 (Chase, 1991).
Aerosolized pentamidine i s now considered a standard PCP
prophylaxis for patients with AIDS and for persons with HIV
disease who have CD4s below 200 cu/mm3. After the maker of
pentamidine was granted a monopoly under the Orphan Drug Act i n
1987, the price of a 300 mg v i a l of pentamidine rose from $24.95
to $99.45, a 400 percent increase over the next two years (Arno,
et a l , 1989).
Pentamidine i s given monthly for PCP prophylaxis,
32
�and with equipment charges for the nebulizer this amounts to a
cost of approximately $3,000 per patient per year.
The CDC estimates that approximately 60 percent of persons
with HIV disease who are pre-AIDS (between 480,000 and 720,000
persons) would currently benefit from treatment with one or both
of these drugs.
I n addition, the majority of persons currently
l i v i n g with AIDS require therapy with both drugs, or with another
a n t i v i r a l agent — an addition of a least 50,000 persons i n 1991.
3.
Delays and Barriers for Special Populations
Intravenous drug users and their partners, which include the
overwhelming majority of women with HIV disease, are confronted
with special barriers to early intervention.
Both populations
are the most l i k e l y of a l l to be uninsured, and although they may
qualify for Medicaid, t y p i c a l l y they are not enrolled.
Frequently, they also are victims of a long-standing enmity
between themselves and the medical community (Hansen, 1985).
Consequently they are unlikely to seek medical care, and i f they
do, they are unlikely to be able to afford i t .
IVDUs are most l i k e l y to receive HIV testing i f the t e s t
s i t e has s t a f f sensitive to the needs of t h i s population, i s
convenient regarding location and hours of operation, w i l l ensure
confidentiality of t e s t results, and can provide follow up
r e f e r r a l and care (Vlahov et a l . , 1991).
Women with HIV disease also face unique b a r r i e r s to early
intervention and treatment.
F i r s t , women with HIV disease are
t y p i c a l l y poorer than a l l other HIV-infected groups.
33
Second, as
�the primary care givers in the home, many women with HIV disease
provide care for t h e i r family members before seeking care for
themselves.
As a result they often present i n i t i a l l y with
advanced HIV disease.
Poor minority women are more l i k e l y to
experience discrimination by health care providers. Delays i n
receiving treatment may be indicated in one study showing that
women have a shorter l i f e expectancy after a diagnosis with AIDS
when compared to men (Rothenberg et a l . , 1987).
F i n a l l y , the CDC
c r i t e r i a for defining AIDS i s based on c r i t e r i a related to males;
infections and medical conditions peculiar to women which may be
associated with HIV disease are currently not well understood and
therefore not part of the c r i t e r i a used to diagnose AIDS.
Consequently, early intervention and therapy for women with AIDS
i s further delayed.
Because of t h e i r need for frequent blood product
transfusions, hemophiliacs are at special r i s k for HIV disease.
Of the roughly 20,000 hemophiliacs in t h i s country, approximately
50 percent have HIV disease.
Of those infected, 1,617 have
developed AIDS, and 1,092 have died as a r e s u l t of t h e i r HIV
disease (Brownstein, 1991).
Although recent technological advancements now make i t
possible to obtain r e l a t i v e l y safe blood products through a
process of v i r a l inactivation, t h i s advancement has brought with
i t massive price increases for such treatment.
I n 1987, for
example, the cost of providing clotting factor therapy to meet
the ordinary needs of one person with severe c l a s s i c a l hemophilia
34
�(which represents roughly 85 persons of a l l persons with
hemophilia) was approximately $10,000 per year.
However, today
that same therapy, after blood product deactivation, regularly
costs from $60,000 to $100,000 per year.
In some cases,
complications may drive the cost to as much as $300,000 or more.
This places an enormous economic burden on these patients to be
able to pay for their care, in addition to t h e i r medical needs
related to HIV.
F i n a l l y , hemophiliacs with HIV disease face other barriers
to primary care.
The current system of regional comprehensive
hemophilia diagnostic and treatment centers has been extremely
successful in providing comprehensive care for individuals with
various forms of hemophilia.
However, as these individuals
become burdened with a second chronic disease, HIV disease, they
require additional and more frequent care.
Thus, patients who
were seen at these treatment centers only once or twice a year,
now are seen 4-12 times per year depending upon the stage of
t h e i r HIV disease.
In addition, as spouses and sexual partners
become HIV infected, they also seek testing, counseling, and
treatment at these centers which have a limited capacity for
additional services (Brownstein, 1991).
B.
Provider Centered Barriers
Physicians, and health care providers in general, are
charged with providing care without discrimination on the basis
of diagnosis.
And yet, provider reluctance to treat patients
with HIV disease may be a s i g n i f i c a n t barrier to early
35
�intervention and care in HIV disease.
Levin has found that
physician attitudes toward care are affected by HIV
serostatus,
with significant differences in the use of aggressive management,
even in asymptomatic HIV disease patients (Levin, 1990).
This reluctance to treat may be even more marked in the case
of IVDU patients, a group with h i s t o r i c a l l y poor relations with
the medical community. A study in Maryland found that IVDU
status and minority status were strongly negatively correlated
with access to early intervention, s p e c i f i c a l l y AZT
pentamidine (Hidalgo,
1990).
and
Early intervention i s e s s e n t i a l l y
outpatient primary care, and the lack of physicians engaged in
primary care in the urban areas where the vast majority of IVDUs
l i v e may
further compound t h i s problem.
C.
Financial Burden on
1.
Providers
Hospitals
Public and teaching hospitals, partly due to t h e i r location
in inner c i t i e s , frequently serve as the primary source of care
for many uninsured, as well as insured AIDS patients.
Both
uninsured patients, and patients insured through Medicaid, are
l e s s l i k e l y to receive preventive health care services.
Consequently, t h e i r s i t e of care i s frequently the hospital
emergency room.
The lack of preventive care for AIDS patients i s also
evident in that i t i s believed that the most common presenting
symptom for AIDS patients i s PCP.
of an HIV-related
In fact, the number one cause
admission in the New
36
York City area in 1988
was
�PCP.
Of the 14,233 admissions for HIV-related problems that
year, 2,969 (20.9 percent) were for PCP.
More importantly, these
patients u t i l i z e d 1.6 times more hospital days for their PCP
infection than did patients with any other HIV-related
admission
(Codman, 1991).
The financing of health care for many persons with HIV
disease contributes to their i n a b i l i t y to obtain timely
preventive care and other health care services as well.
For
example, the financing of health care for hospitalized AIDS
patients appears to be steadily shifting away from reimbursement
through private insurance plans and moving more toward
reimbursement through Medicaid.
This s h i f t in payer distribution
has occurred among white as well as black and Hispanic
populations
(Green and Arno, 1990).
In New York City, 58.5
percent of a l l HIV-related hospital admissions in 1988
reported
Medicaid as t h e i r primary payor (Codman, 1991).
This s h i f t in source of payment places a s i g n i f i c a n t
economic burden on institutions which care for patients with HIV
disease.
States such as New York, New Jersey, Maryland, and
Massachusetts have state rate-setting systems that reduce or
eliminate substantial differences between Medicaid payment rates
and that of private insurers for inpatient care.
However, in the
majority of the other states Medicaid reimbursement for hospital
care of AIDS patients may be substantially lower than the rates
paid by private insurers. Consequently, the number of hospitals
37
�and c l i n i c s w i l l i n g t o provide medical care t o i n d i v i d u a l s with
HIV d i s e a s e i s l i m i t e d .
One study sampling both p r i v a t e and p u b l i c h o s p i t a l s i n 1987
found t h a t a small percentage of h o s p i t a l s ( l e s s than f i v e
percent) provided care f o r the majority of a l l AIDS admissions;
20 percent of a l l h o s p i t a l s provided care f o r 77 percent of AIDS
admissions (Andrulis e t a l . , 1989).
These f i n d i n g s were based on
a very small sample of U.S. h o s p i t a l s and a r e not r e p r e s e n t a t i v e
of a l l h o s p i t a l s .
P u b l i c and teaching h o s p i t a l s , e s p e c i a l l y those i n inner
c i t y l o c a t i o n s , and t h e i r emergency rooms, may bear a
disproportionate
share of care f o r AIDS p a t i e n t s .
I n the
A n d r u l i s survey, 54 percent (9917) of AIDS p a t i e n t s were admitted
i n t o p u b l i c h o s p i t a l s , while the remaining 46 percent (8459) were
admitted i n t o p r i v a t e h o s p i t a l s .
T h i s c o r r e l a t e s c l o s e l y with
the d i s t r i b u t i o n of AIDS cases which a r e l i k e l y t o r e s i d e near
p u b l i c and teaching
hospitals.
The A n d r u l i s survey a l s o suggests t h a t p u b l i c h o s p i t a l s may
provide a l a r g e portion of the outpatient
care f o r AIDS p a t i e n t s .
I n the sample of h o s p i t a l s , 82 percent of a l l outpatient
visits
by AIDS p a t i e n t s f o r treatment i n 1987 were made a t p u b l i c
hospitals.
Importantly, 57 percent of those outpatient
p u b l i c h o s p i t a l s were made by p a t i e n t s c a t e g o r i z e d
(Andrulis e t a l . , 1989).
2.
Migrant/Community Health Centers and C l i n i c s
38
v i s i t s at
a s " s e l f pay"
�The nearly 500 Migrant/Community Health Centers (M/CHCs) and
their related 1,500 c l i n i c s around the country provide a variety
of medical services for over 6 million patients each year.
Since
these centers have been located in high poverty and high need
areas, the population served i s disproportionately uninsured.
Although roughly 11 percent of a l l Americans are uninsured, 49
percent of a l l patients seen at M/CHCs are uninsured; another 38
percent are insured under Medicaid.
Treating such a high
proportion of uninsured and underinsured patients places a burden
on these centers —
especially when budgetary cutbacks l i m i t
direct public funding.
Although many centers are providing education, prevention,
and counseling services to persons with HIV disease, many others
are not providing such essential services, or are j u s t beginning
to do so.
There i s no well-established, integrated system
linking these and other c l i n i c s to a variety of other services
necessary to provide comprehensive care for these patients as the
disease progresses and their needs change.
For example, many
centers are not actively involved with local AIDS care networks
and cannot draw upon the additional services available from other
providers, thus the range of support services available may
be adequate to meet their needs.
not
Community-based organizations
(CBOs) serving persons with HIV disease have been founded
s p e c i f i c a l l y to provide care for t h i s population.
Volunteers
have helped expand the range of services available in such CBOs,
but they are not equipped to meet the needs of the new
39
HIV
�disease populations requiring care such as families, women, and
children.
Finally, funding cutbacks at the federal, state and local
government level threaten to jeopardize the a b i l i t y of community
health centers and community-based organizations to meet the
growing need for care of the HIV disease population.
3.
Primarv Care Providers and Medicaid
The adequacy of reimbursement under Medicaid can also be an
important factor in the a v a i l a b i l i t y of primary care to persons
with HIV disease.
Medicaid reimbursement
rates for physician
office v i s i t s and services are substantially lower than for
v i s i t s financed through private insurance. In 1988, a l l but five
states reimbursed for comprehensive office v i s i t s at a rate
substantially below the prevailing Medicare charge (PPRC, 1991).
On average Medicaid pays physicians at 64 percent of the Medicare
rate —
although there i s wide variation from state to state and
service to service.
With a nearly eight-fold difference i n the
rate of reimbursement between Medicaid and private insurance i n
some states, there i s l i t t l e incentive for physicians to provide
care to AIDS patients.
Not only does Medicaid t y p i c a l l y
reimburse at lower rates, but some states place a r t i f i c i a l l i m i t s
on the number of covered v i s i t s (for an AIDS patient the need for
primary care v i s i t s w i l l increase over the course of the
disease).
Medicaid reimburses for very few adult preventive
services (AIDS patients need access to a wide range of preventive
services).
40
�A l l of these factors discourage many physicians from
accepting new AIDS patients i f they present i n i t i a l l y with
coverage only through Medicaid.
Other physicians w i l l care for
patients receiving Medicaid, but usually only i f they i n i t i a l l y
presented with private insurance coverage.
D.
Inefficiency in Current Care Patterns
The question of whether the current health financing system
contributes to i n e f f i c i e n t patterns of care i s not c l e a r l y
resolved by current research.
However, there are a few
indications that there are more e f f i c i e n t care patterns than
those currently used.
A study from Texas showed that Medicaid spends more per
AIDS case than does private insurance, but the number of hospital
days per admission i s less (the authors f e l t that t h i s
may
indicate that Medicaid patients may not be receiving optimum
care) (Begley and Hintz, 1990).
In addition, state Medicaid
programs are growing rapidly because of federally-mandated
expansions of coverage to low-income pregnant women and children.
Some states are diverting funds to Medicaid from other programs,
e.g. sexually-transmitted disease (STD) programs with the
resultant alarming increase in incidence rates of STDs (Rowe and
Ryan, 1988).
l e v e l since
In fact, new cases of s y p h i l i s are at t h e i r highest
1949.
Currently, i t i s d i f f i c u l t to forecast i f there i s any added
cost-savings to using AZT or other early intervention programs.
AZT and aerosolized pentamidine generally prevent or delay some
41
�of
t h e more s e r i o u s i n f e c t i o n s a s s o c i a t e d w i t h AIDS.
This
should
i n c r e a s e t h e i n t e r v a l between h o s p i t a l i z a t i o n s , and s h o r t e n t h e
length of h o s p i t a l i z a t i o n .
A r e c e n t study based on 14 p a t i e n t s
i n d i c a t e s t h a t t h e average c o s t s f o r t r e a t i n g h o s p i t a l i z e d AIDS
p a t i e n t s were s i g n i f i c a n t l y lower f o r p a t i e n t s ' u s i n g
(Scitovsky et a l . ,
1990).
AZT
However, these savings were d e r i v e d
d u r i n g t h e f i r s t s i x months o f t h e i n v e s t i g a t i o n .
Indeed,
the
l a s t s i x months o f t h e study d i d n o t y i e l d s i g n i f i c a n t savings
t h e lower e a r l y c o s t s o f AZT
t h e r a p y e v e n t u a l l y ends, and
as
the
c o s t s b e g i n t o r i s e s u b s t a n t i a l l y towards t h e t e r m i n a l phase o f
t h e disease.
Schulman e t a l . a l s o found evidence o f savings
e a r l y i n t e r v e n t i o n (Schulman e t a l . ,
from
1991).
I t s h o u l d be noted t h a t i n c r e a s e d s u r v i v a b i l i t y o f persons
on AZT
increases the l i f e t i m e cost of treatment.
However, t h e
g a i n i n l i f e expectancy i s v a l u a b l e i n human terms.
Lengthened
l i f e expectancy a l s o c o n f e r s economic b e n e f i t s from t h e g r e a t e r
l e n g t h o f t i m e t h a t persons w i t h HIV disease are a b l e t o remain
p r o d u c t i v e members o f t h e work f o r c e , t h u s , r e d u c i n g t h e
costs of the disease.
indirect
I n f a c t , a r e c e n t s t u d y showed t h a t t h e
average annual e a r n i n g s o f male AIDS p a t i e n t s ( i n Texas) was
11 p e r c e n t below t h e n a t i o n a l average ( Y e l i n e t a l . ,
only
1991).
Another f a c t o r which needs t o be t a k e n i n t o c o n s i d e r a t i o n i s t h a t
t h e r e may
of
be a s l i g h t c o s t - s a v i n g component t o u s i n g AZT
i n terms
d i r e c t c o s t s , as S c i t o v s k y e t a l . (1990) used a " h i g h
e s t i m a t e " o f t h e c o s t o f AZT,
and
i n f a c t t h e dosage has r e c e n t l y
been reduced by 50 p e r c e n t s i n c e t h e t i m e o f t h e i r
42
study.
�Outpatient management of AIDS cases has proven to be
successful in early studies. The most important example of t h i s
i s the San Francisco area which in one study showed a lowered
treatment cost per AIDS patient once outpatient regimens had
begun (Hiatt et a l . , 1990).
Another reason that the San
Francisco cohort may have lowered AIDS care costs i s that many
medical care providers in that area have vast experience in
treating AIDS leading to greater efficiency.
IV.
Policy Options and Recommendations for Improving Health
Financing for Persons with HIV
Disease
The policy options set forth in t h i s report provide a
selection of incremental steps which could be acted upon
immediately to improve health care financing for persons with
AIDS/HIV and other chronic i l l n e s s e s .
In developing these policy
options, the primary objective has been to keep them consistent
with longer term comprehensive reform and a policy of universal
health insurance which would ensure access to health care for a l l
Americans.
Additionally emphasis has been placed on options
which:
o
Encourage greater access to health care, especially
through early intervention and outpatient primary care;
o
Provide financing for a s u f f i c i e n t l y broad range of
health care benefits to avoid distortions and
i n e f f i c i e n c i e s in patterns of patient care;
o
Assure provider participation by setting
payment rates at adequate rates, while
43
avoiding
�unseemly p r o f i t s and open-ended e s c a l a t i n g h e a l t h care
costs;
o
Promote e q u i t y and f a i r n e s s by g i v i n g t h e g r e a t e s t
a s s i s t a n c e t o those most i n need —
w i t h c a t a s t r o p h i c a l l y expensive
t h e poor and
those
illnesses.
The o p t i o n s do n o t emphasize an employer-based h e a l t h
i n s u r a n c e approach because i t would n o t be s u c c e s s f u l i n meeting
the
immediate
needs o f persons w i t h HIV d i s e a s e .
Many a f f e c t e d
persons, d e s p e r a t e l y needing care a t t h e c u r r e n t t i m e , are
o u t s i d e t h e w o r k f o r c e o r are unable t o c o n t i n u e w o r k i n g once t h e
disease progresses t o an advanced stage.
T h e i r needs are
expensive and p r i v a t e i n s u r e r s have been r e l u c t a n t t o s h o u l d e r a
g r e a t e r p o r t i o n o f t h e f i n a n c i n g burden.
f o r c e t h i s burden on employers
Regulatory attempts t o
and i n s u r e r s i n t h e absence o f
more comprehensive r e f o r m s are l i k e l y t o be c i r c u m v e n t e d .
The p o l i c y o p t i o n s which f o l l o w i n c l u d e expanding
f i n a n c i n g programs such as M e d i c a i d , Medicare,
current
and p r i v a t e h e a l t h
i n s u r a n c e , d i r e c t f u n d i n g t o p r o v i d e r s o f s e r v i c e s , and
r e g u l a t o r y e f f o r t s t o lower t h e c o s t o f drug t r e a t m e n t s .
the
While
focus o f t h e d i s c u s s i o n i s on t h e s p e c i f i c impact and c o s t o f
c o v e r i n g persons w i t h HIV d i s e a s e , i t i s assumed t h a t any
a c t i o n t a k e n would a p p l y t o a l l s i m i l a r l y s i t u a t e d
s u f f e r i n g from o t h e r t y p e s o f h e a l t h c o n d i t i o n s .
policy
persons
Such
coverage
m i g h t be phased i n over t i m e , b e g i n n i n g w i t h h i g h p r i o r i t y
groups
such as p r e g n a n t women, c h i l d r e n , and t h o s e w i t h c o s t l y o r
terminal illnesses.
Where a v a i l a b l e c o s t e s t i m a t e s a r e p r e s e n t e d
44
�for phasing in coverage for persons with HIV disease and for
extending the policy option to the entire disabled
population.
I t should also be noted that a l l estiinates of costs and impacts
are preliminary and tentative.
the HIV disease population,
The absence of systematic data on
including income, insurance coverage,
employment status, and health care u t i l i z a t i o n and expenditure
patterns i s a serious barrier to r e l i a b l e estimates.
See
Appendix A, prepared by Actuarial Research Corporation,
for a
description of the data sources and assumptions used in the cost
estimates.
A.
Universal Health Insurance
Option 1:
Provide universal health care coverage for a l l persons
l i v i n g in the United States to ensure access to quality health
care services.
1.
Impact
This option would extend health insurance coverage to an
estimated
34 million uninsured Americans and improve the adequacy
of health care benefits for tens of millions more. Most
importantly,
a system of universal health insurance coverage
would guarantee continuity of health insurance coverage —
so
that no one would have to fear losing health insurance coverage
i f they changed jobs, were unable to work, or incurred a serious
medical i l l n e s s .
Guaranteed universal coverage would remove the
discrimination against coverage for persons with HIV disease.
Universal continuous coverage can most simply to
accomplished in a single public plan covering the entire
45
�population.
Legislative universal health insurance plans which
would rely on a single public plan include proposals by
Congressman Marty Russo ( D . - I l l . ) and Congressman Tom Downey (D.N.Y.), Senator Robert Kerrey
(D.-Neb.).
Another public plan
approach i s to extend the current Medicare program to the entire
population.
Congressman Pete Stark (D.-Cal.) and Congressman Sam
Gibbons (D.-Fla.) have Medicare for a l l proposals.
Universal health coverage can also be achieved through a
combination of private health insurance coverage provided through
employers and a public plan to cover everyone not covered under
such a plan.
One mixed private-public plan i s called employer
"play or pay" which would required employers to either provide
health insurance to workers and dependents or pay a payroll tax
to a public plan to provide such coverage.
L e g i s l a t i v e proposals
along t h i s line include those introduced by Senator George
Mitchell (D.-Me.), Senator Edward M. Kennedy (D.-Mass.), Senator
Jay Rockefeller (D.-W.Va.), and Senator Donald Riegel (D.-Mich).
Employer "pay or play" plans that also incorporate all-payer
provider payment cost controls include proposals by Congressman
Henry Waxman (D.-Cal.) and Senator Jay Rockefeller (D.-W. Va.)
and Congressman Dan Rostenkowski ( D . - I l l . ) .
Plans that r e t a i n a
major role for private health insurance t y p i c a l l y reform the
provision of coverage to small firms, eliminating many of the
underwriting
practices that currently discriminate against
persons with HIV disease.
46
�A l l of these proposals include a benefit package that
includes hospital and physician services and limited preventive
services.
However, most of these plans do not include
prescription drugs which are essential for care of persons with
HIV disease.
Nor do they provide long-term care, such as home
health care and s k i l l e d nursing f a c i l i t y care.
I t i s important
that any universal health insurance plan be expanded to include
at least those prescription drugs that are needed in the care of
persons with HIV disease.
2.
Cost
The cost of universal health insurance varies by plan.
Plans that require employers to provide health insurance coverage
to workers and dependents have the least impact on federal
budgetary outlays —
typically
around $25 b i l l i o n in federal
budget outlays to provide universal health insurance for health
care, and another $40 b i l l i o n for long-term care.
Comprehensive
public plans that provide a single plan covering the entire
population
and replacing employer-provided private health
insurance would add $225 to $300 b i l l i o n to the federal budget.
Cost to the health system would be considerably
less,
however, since some federal costs would replace current spending
by state governments and individuals.
Estimated new
health
spending would be $12 b i l l i o n to $35 b i l l i o n , depending on the
benefit structure, or less than 5 percent of t o t a l health
expenditures.
47
�B.
Medicaid
O p t i o n 2:
Expand M e d i c a i d t o cover a l l low-income people
HIV d i s e a s e .
with
I n c r e a s e Medicaid payment r a t e s f o r p h y s i c i a n s ,
h e a l t h c e n t e r s , h o s p i t a l s , and o t h e r h e a l t h care p r o v i d e r s t o a
l e v e l s u f f i c i e n t t o ensure adequate p a r t i c i p a t i o n .
1.
Impact
Most persons w i t h HIV disease who
currently qualify for
Medicaid do so under t h e d i s a b i l i t y e l i g i b i l i t y c a t e g o r y .
People
who have t e s t e d HIV p o s i t i v e b u t have n o t advanced t o a d i a g n o s i s
of AIDS do n o t q u a l i f y , even i f t h e y meet t h e low-income
e l i g i b i l i t y requirements.
T h i s r e s t r i c t i o n r e n d e r s poor
people
w i t h HIV disease who do n o t have a c l i n i c a l d i a g n o s i s o f AIDs
v i r t u a l l y i n e l i g i b l e f o r t h e e a r l y i n t e r v e n t i o n t r e a t m e n t s and
s e r v i c e s t h a t can d e l a y p r o g r e s s i o n o f HIV d i s e a s e , p r e v e n t
o p p o r t u n i s t i c i n f e c t i o n s , and l i m i t numerous (and expensive)
hospital
visits.
T h i s o p t i o n would i n c r e a s e t h e number o f persons covered
M e d i c a i d i n two ways.
Eliminating the d i s a b i l i t y
would l e a d t o coverage
o f low-income persons
HIV d i s e a s e , r a t h e r t h a n p o s t p o n i n g coverage
by
requirement
i n e a r l y stages o f
u n t i l t h e y have a
c l i n i c a l d i a g n o s i s o f AIDS.
I n a d d i t i o n t h i s o p t i o n r a i s e s t h e income e l i g i b i l i t y
for
coverage.
level
C u r r e n t l y , an i n d i v i d u a l must a c t u a l l y be, o r i n
some s t a t e s be a t r i s k o f becoming, e x t r e m e l y poor t o meet t h e
income e l i g i b i l i t y r e q u i r e m e n t s f o r M e d i c a i d .
Many p e o p l e
with
HIV d i s e a s e a r e n o t impoverished b u t n e v e r t h e l e s s do n o t have t h e
48
�health insurance or independent means to pay for the health care
treatments and sex-vices they need.
Therefore, either they are
forced to rely on the already overburdened public hospital system
for expensive inpatient care or they must spend themselves into
poverty to qualify for Medicaid.
Once impoverished and e l i g i b l e
for Medicaid, they become dependent on many other welfare
programs for such basic needs as food, clothing, and shelter.
Eliminating the d i s a b i l i t y requirement for people with HIV
disease and raising the current income e l i g i b i l i t y
to 100 percent
of the federal poverty level would expand Medicaid coverage to
include an estimated additional 6,800 persons with incomes below
poverty with AIDS and 63,700 with incomes below poverty with HIV
infection.
The option would include permitting anyone with an income
between 100 percent and 2 00 percent of poverty to be covered by
Medicaid by paying a premium that varies on a sliding scale with
income. I t i s expected that 13,600 individuals with AIDS with
incomes between 100% and 200% of poverty and 15,544 individuals
with HIV infection with incomes between 100% and 200% would pay
an income based premium to purchase Medicaid.
Individuals with
an income of 200% of poverty would pay a f u l l premium of $1068
(U.S. average for adult males), and individuals with an income of
150% would pay a premium of $532.
Although the f u l l premium of
$1068 would appear to be high, i t i s s i g n i f i c a n t l y lower than
premiums for private individual or group insurance.
49
�This recommendation would be p a r t i c u l a r l y b e n e f i c i a l t o
Medicaid e l i g i b l e i n d i v i d u a l s who are HIV p o s i t i v e , but who do
not
have a c l i n i c a l diagnosis of AIDS.
By extending coverage t o
HIV p o s i t i v e persons, t h i s option would address t h e i r urgent need
for expensive early i n t e r v e n t i o n treatments, i n c l u d i n g counseling
to prevent the spread of the disease and drugs t o both delay the
progression of the disease and t o improve p a t i e n t f u n c t i o n i n g .
Currently, Medicaid and Medicare do not provide f o r e a r l y
i n t e r v e n t i o n because they are generally only a v a i l a b l e t o
i n d i v i d u a l s w i t h a c l i n i c a l diagnosis of AIDS.
In general, i n d i v i d u a l s , meeting the Medicaid e l i g i b i l i t y
c r i t e r i a under t h i s recommendation, would have improved access t o
a comprehensive package of health b e n e f i t s .
This package would
include h o s p i t a l i n p a t i e n t and o u t p a t i e n t services, physician
services, s k i l l e d nursing f a c i l i t y care, l a b o r a t o r y and x-ray
services, and h e a l t h screening and follow-up services and
supplies.
This option would also address the c u r r e n t low Medicaid
p r o v i d e r reimbursement r a t e s .
Medicaid's substandard p r o v i d e r
payment rates l i m i t the a v a i l a b i l i t y of ambulatory care t o
persons w i t h HIV disease.
I t contributes t o inappropriate
s u b s t i t u t i o n and use of emergency rooms and o u t p a t i e n t
departments as a regular source of care (Green and Arno, 1990 and
IHPP, 1990).
Medicaid payment rates f o r physicians should be
r a i s e d a t l e a s t t o the new Medicare physician fee schedule t o be
50
�implemented i n January 1992, rather than averaging only 64
percent of Medicare rates as i s presently the case (PPRC, 1991).
To expand primary care to Medicaid beneficiaries with HIV
disease, a l l community health centers and community-based
organizations receiving Ryan White funding should be entitled to
Federally Qualified Health Centers (FQHCs) status.
As a FQHC,
these providers would be e l i g i b l e for reimbursement at 100
percent of reasonable cost under Medicaid.
This should increase
the a v a i l a b i l i t y of primary care in areas with large
concentrations of persons in need of care.
Low reimbursement rates to hospitals may contribute to an
inequitable distribution of patients with HIV disease. States
should ensure that payment rates are adequate to cover cost of
caring for persons with AIDS/HIV i n an e f f i c i e n t manner.
2.
Cost
The estimated Medicaid cost of t h i s option i s $610 million
in FY 1991, s p l i t $311 million to the federal government and $299
million to state governments.
This option would represent l e s s
than a one percent increase in total Medicaid expenditures.
However, costs can be expected to increase in future years with
increases i n l i f e expectancy and the prevalence of AIDS/HIV among
low income IVDUs.
Variations on t h i s option could reduce or increase t h i s
basic cost.
I f coverage were limited to those with incomes below
the poverty l e v e l , the overall estimated Medicaid cost of t h i s
51
�o p t i o n would be $345 m i l l i o n i n FY1991, s p l i t between t h e f e d e r a l
government
($176 m i l l i o n )
and s t a t e governments
($169 m i l l i o n ) .
I f t h e income r e q u i r e m e n t were r a i s e d t o 185 p e r c e n t o f t h e
federal poverty l e v e l , with applicable
asset t e s t s , Medicaid
would cover 91,000 people w i t h HIV i n f e c t i o n
w i t h AIDS.
and 21,000 people
The t o t a l c o s t f o r M e d i c a i d would be $660 m i l l i o n ,
and would be s p l i t between t h e f e d e r a l government
and s t a t e governments
($337
million)
($323 m i l l i o n ) .
I f t h e income r e q u i r e m e n t were r a i s e d t o 200 p e r c e n t o f t h e
f e d e r a l p o v e r t y and t h e a s s e t t e s t f o r e l i g i b i l i t y were
eliminated,
infection
M e d i c a i d would cover 103,200 more people w i t h
and 22,100 w i t h AIDs.
HIV
The t o t a l c o s t t o M e d i c a i d would
be $727 m i l l i o n , and would be s p l i t between t h e f e d e r a l
government
3.
($371 m i l l i o n )
and s t a t e governments
($356 m i l l i o n ) .
E q u i t a b l e Treatment o f non-HIV Disease D i s a b l e d P o p u l a t i o n s
T h i s o p t i o n c o u l d a l s o be extended t o a l l low income
i n d i v i d u a l s w i t h s i m i l a r l y c h r o n i c diagnoses, such as cancer.
Those w i t h s e r i o u s ,
expensive c h r o n i c h e a l t h c o n d i t i o n s
requiring
r e c u r r i n g c a r e s h o u l d be t h e t o p p r i o r i t y f o r M e d i c a i d e x p a n s i o n .
There a r e an e s t i m a t e d 16 m i l l i o n u n i n s u r e d persons and 5 m i l l i o n
persons w i t h non-group
poverty level
i n s u r a n c e w i t h incomes below t h e f e d e r a l
(Census Bureau, 1990).
I f a l l poor persons w i t h o u t
group i n s u r a n c e were t o be covered under M e d i c a i d , r a t h e r t h a n
j u s t poor persons w i t h HIV d i s e a s e , t h e e s t i m a t e d c o s t would be
more t h a n $25 b i l l i o n i n 1991.
52
�Another approach, which would be more l i m i t e d b u t p r e s e r v e
e q u i t a b l e t r e a t m e n t would be t o expand SSI and Medicaid t o cover
a l l poor d i s a b l e d
persons.
persons ( e s t i m a t e d
There are about 680,000
disabled
as 20 p e r c e n t o f t h e c u r r e n t SSI
population)
w i t h incomes below t h e p o v e r t y l e v e l , who are n o t on M e d i c a i d .
I f a l l o f them were t o be covered under M e d i c a i d , t h e e s t i m a t e d
c o s t would be about $4.1 b i l l i o n assuming a c o s t o f $6,000 per
person.
Currently,
t h e s t a t e SSI e l i g i b i l i t y l e v e l s are a t l e a s t
77 p e r c e n t o f p o v e r t y l e v e l s f o r a s i n g l e i n d i v i d u a l
unearned income
with
(more w i t h s t a t e supplements) and a t l e a s t
p e r c e n t o f p o v e r t y l e v e l s f o r those w i t h earned incomes.
have t h e o p t i o n o f c o v e r i n g t h e d i s a b l e d
163
States
w i t h incomes up t o 100
percent of the poverty l e v e l .
O p t i o n 3:
P r o v i d e a l l s t a t e s w i t h t h e o p t i o n o f expanding
M e d i c a i d coverage, w i t h f e d e r a l l y matched s t a t e f u n d i n g ,
to a l l
i n d i v i d u a l s w i t h HIV i n f e c t i o n o r AIDS w i t h incomes below t h e
f e d e r a l p o v e r t y l e v e l and meeting t h e SSI a s s e t t e s t .
1.
Impact
T h i s o p t i o n d i f f e r s from O p t i o n 2 i n t h a t i t would make
expanded
coverage o p t i o n a l t o t h e s t a t e s , r a t h e r t h a n mandatory.
I t s i m p a c t , t h e r e f o r e , h i n g e s on t h e number o f s t a t e s which a r e
l i k e l y t o seek f e d e r a l matching f o r c a r e f o r low-income
persons
w i t h HIV d i s e a s e i f such an o p t i o n were a v a i l a b l e .
I t i s expected t h a t t h i s o p t i o n would be a t t r a c t i v e t o
states with a disproportionate
disease.
share o f i n d i v i d u a l s w i t h
HIV
I t would r e l i e v e some o f t h e s t a t e s ' f i n a n c i a l burden
53
�experienced when they use state-only funds to provide care to
persons with HIV disease.
This could be p a r t i c u l a r l y beneficial
at a time when many states are being forced to r e s t r i c t t h e i r
Medicaid programs in response to alarming budget d e f i c i t s .
I t i s assumed that New York and California, the two states
with the largest HIV disease populations, would choose to follow
through with t h i s option.
Together they have 4 3 percent of the
total HIV disease population, so they would receive a
considerable amount of federal funding in the form of matched
funding.
I t i s estimated that 25,231 individuals with HIV
disease in New York and California would be newly enrolled in
Medicaid in 1991.
An estimated 1,000
individuals in New York
with f u l l blown AIDS would be enrolled in Medicaid
(persons with
AIDS in California already receive Medicaid coverage through
t h e i r l i b e r a l SSI program).
The majority of persons newly
covered with HIV disease would have been previously uninsured.
State Medicaid programs currently have the option of
enrolling a l l disabled persons with incomes below a l e v e l up to
100 percent of the poverty l e v e l .
However, only 13 states
altogether and only five of the 15 states, characterized as
having the largest AIDS populations, had chosen t h i s option by
the end of 1990.
New York and California have not.
California
does, however, have one of the most l i b e r a l SSI programs with an
income l i m i t exceeding 100 percent of the poverty level so that
a l l the persons with a c l i n i c a l diagnosis of AIDS and a low
income would qualify for SSI and Medicaid on the basis of
54
�disability.
However, t h e e l i g i b i l i t y requirement o f a c l i n i c a l
d i a g n o s i s o f AIDS, i n b o t h New
of t h e U.S.,
York and C a l i f o r n i a and t h e r e s t
i s very r e s t r i c t i v e f o r i n d i v i d u a l s , w i t h
disease b u t w i t h o u t f u l l blown AIDS.
HIV
I t i s a problem f o r many
because i t o f t e n d e l a y s an i n d i v i d u a l from q u a l i f y i n g f o r SSI
and
Medicaid u n t i l l a t e r stages i n t h e p r o g r e s s i o n o f t h e d i s e a s e .
T h i s o p t i o n t h e r e f o r e would be p a r t i c u l a r l y b e n e f i c i a l t o
i n d i v i d u a l s w i t h HIV disease by a d d r e s s i n g t h e i r need f o r e a r l y
intervention services.
While t h i s o p t i o n would i n c r e a s e t h e number w i t h Medicaid
coverage
i n New
York and C a l i f o r n i a , low p r o v i d e r
reimbursement
r a t e s under Medicaid c o u l d a g a i n s i g n i f i c a n t l y l i m i t t h e
a v a i l a b i l i t y o f care t o persons w i t h HIV d i s e a s e .
I n New
York
t h e r e are n o t enough p h y s i c i a n s a v a i l a b l e t o p r o v i d e care t o
i n d i v i d u a l s w i t h AIDS/HIV on Medicaid.
C a l i f o r n i a ' s Medicaid
p h y s i c i a n fees were 54 p e r c e n t o f Medicare p r e v a i l i n g charges i n
1988.
These low reimbursement
M e d i c a i d p r o v i d e r s may
r a t e s and l i m i t e d a v a i l a b i l i t y o f
l e a d i n d i v i d u a l s w i t h HIV disease t o
u t i l i z e emergency rooms and o u t p a t i e n t
departments
i n a p p r o p r i a t e l y as a r e g u l a r source o f p r i m a r y c a r e .
A l t h o u g h t h i s recommendation would extend M e d i c a i d
coverage
t o many i n d i v i d u a l s i n t h e s t a t e s a c c e p t i n g t h i s p r o p o s a l , i t
would a l s o l e a v e many near-poor and o t h e r low-income
w i t h o u t coverage.
persons
I t would p r o b a b l y n o t extend coverage i n
s t a t e s such as I l l i n o i s where t h e r e are an e s t i m a t e d 2,600
i n d i v i d u a l s w i t h AIDS and 34,800 o t h e r i n d i v i d u a l s w i t h
55
HIV
�disease.
I n order t o become e l i g i b l e f o r Medicaid these
i n d i v i d u a l s would have t o "spend down" below the required
medically needy l e v e l s .
C a l i f o r n i a and New York both provide comprehensive h e a l t h
care b e n e f i t s t o a l l Medicaid r e c i p i e n t s whether or not they are
c a t e g o r i c a l l y needy receiving cash payments.
I n C a l i f o r n i a and
New York, i n d i v i d u a l s would receive p r e s c r i p t i o n drugs under t h i s
option.
I f the state has l i m i t s on p r e s c r i p t i o n drugs under
Medicaid, i t i s expected t h a t coverage would be granted on the
grounds t h a t the p r e s c r i p t i o n drug could be determined "medically
necessary."
2.
Cost
The estimated Medicaid cost of t h i s option i s $139 m i l l i o n
i n 1991, h a l f paid by the federal government and h a l f by the
states.
Of the t o t a l cost, $109 m i l l i o n i s f o r the care of
persons w i t h HIV i n f e c t i o n while $30 m i l l i o n i s f o r the care of
persons w i t h AIDS.
This option would increase t o t a l Medicaid
expenditures by 0.1 percent.
The 1991 average Medicaid
reimbursements per person would be $2,588 f o r HIV treatment i n
C a l i f o r n i a and New York, $28,160 f o r AIDS treatment i n New York,
$2,199 f o r non-HIV r e l a t e d medical treatment i n New York and
$1,301 f o r non-HIV r e l a t e d medical treatment i n C a l i f o r n i a .
Forty percent of the HIV population w i l l receive monitoring and
counseling a t a cost of $418 per person while the other s i x t y
percent have CD4+ c e l l l e v e l s below 500 and would receive medical
treatment t h a t i s estimated t o be $4,034 per person.
56
�Again as i n the Medicaid recommendation, these cost
estimates can be expected to increase in future years with the
increases in prevalence of HIV disease.
Further, cases i n the
future may be more costly with increases in l i f e expectancy and
the
number of IVDU's.
In addition, the percentage of full-blown
AIDS cases who would be e l i g i b l e for Medicaid under the current
guidelines w i l l probably r i s e (0.5-1 percent a year) due to the
projected epidemic i n IVDUs.
3.
Equitable Treatment of non-HIV Disease Disabled Populations
Again, as in the f i r s t Medicaid option, t h i s option could be
extended to a l l low income individuals with s i m i l a r l y chronic
diagnoses, such as cancer.
Option 4: Mandate Medicaid to pay COBRA health insurance
premiums for low-income persons with HIV disease who have l e f t
t h e i r jobs and cannot afford to pay the health insurance premium.
1.
Impact
This option i s an extension of the current COBRA 1985
provisions.
Medicaid funds would be used to continue private
insurance coverage provided by an employer for up to 29 months,
by paying the premiums for individuals with HIV disease who have
l e f t employment.
I f the coverage had been allowed to lapse, the
current l e g i s l a t i o n would be amended to permit Medicaid to
reinstate employer-based coverage.
The option assumes that
individuals would qualify for Medicare on the basis of d i s a b i l i t y
at the end of the 29 month coverage period.
57
�T h i s option would extend employer sponsored
insurance to an
estimated 2,030 persons with AIDS and 7,959 persons with HIV
i n f e c t i o n by mandating Medicaid to pay the premium.
Of the 2,030
persons with AIDS r e c e i v i n g coverage under t h i s option,
would have p r e v i o u s l y been e l i g i b l e for Medicaid.
1,624
( I t i s assumed
t h a t the low-income population cannot a f f o r d the COBRA premiums
and would apply f o r Medicaid).
T h i s option has the advantage of buying b e n e f i c i a r i e s i n t o
p r i v a t e coverage which i s g e n e r a l l y much more a t t r a c t i v e ,
compared to Medicare or Medicaid,
reimbursement r a t e s .
i n terms of provider
I n addition, a comprehensive package of
b e n e f i t s i s provided through many employer sponsored group plans,
which would include the e a r l y i n t e r v e n t i o n treatments.
A
drawback to t h i s option would occur when the employer based plan
had taken p r o v i s i o n s to exclude the coverage of HIV d i s e a s e
h e a l t h care b e n e f i t s .
The more generous reimbursement r a t e s would be a t t r a c t i v e to
p r o v i d e r s and persons with HIV d i s e a s e , who would not be r e q u i r e d
to change t h e i r source of c a r e , as they would i f covered under
Medicaid and t h e i r p h y s i c i a n s and/or h o s p i t a l did not p a r t i c i p a t e
i n Medicaid.
T h i s option might take some of the burden of
providing c a r e to i n d i v i d u a l s with HIV d i s e a s e away from the
teaching and p u b l i c h o s p i t a l and a l s o from those p h y s i c i a n s
accepting Medicaid
assignment.
Disadvantages to t h i s option are t h a t i t only a p p l i e s to
people who
have l e f t employment with companies with 20 or more
58
�employees that currently provide health insurance to workers and
dependents.
As a result, i t affects a comparatively small number
of individuals.
The cost of employer coverage could be expected
to increase under t h i s option.
Smaller firms providing health
insurance are l i k e l y to be hardest h i t and may well drop coverage
altogether, rather than continue to be responsible for coverage
of persons with HIV disease following termination of employment.
I t might also increase discriminatory barriers to employment for
persons with HIV disease.
Currently, as discussed e a r l i e r , Medicaid law provides a l l
states with the option of paying COBRA premiums in t h i s manner.
A total of eight states and the D i s t r i c t of Columbia have taken
preliminary steps to implement t h i s type of a policy.
In
particular, the experiences of Texas and Washington could be
monitored and used as models for a nationally mandated Medicaid
premium paying program.
2.
Savings
This option results in a net cost savings to Medicaid as a
r e s u l t of s h i f t i n g costs from the Medicaid program to employers
through continuing coverage under employer sponsored insurance
plans.
Overall FY 1991 savings to Medicaid would be $4 million
for both the HIV positive and AIDS populations.
Of t h i s , $28
million i s saved for the AIDS population, while the net cost i s
$24 million for the HIV positive population.
59
�3.
E q u i t a b l e Treatment of non-HIV Disease Disabled Populations
T h i s option could be extended t o i n d i v i d u a l s s u f f e r i n g from
other s i m i l a r chronic conditions, such as cancer.
A further
equity i s s u e , however, i s t h a t i t a s s i s t s those who p r e v i o u s l y
had employer-provided h e a l t h insurance but does not a s s i s t
s i m i l a r l y s i t u a t e d persons without such coverage.
T h i s option
would, t h e r e f o r e , be l e s s l i k e l y t o cover women, c h i l d r e n ,
Hispanics and b l a c k s , who have higher r a t e s of unemployment or
part-time employment where insurance i s not o f f e r e d .
T h i s option could be extended t o the e n t i r e poor SSDI
d i s a b l e d population.
HCFA's O f f i c e of the Actuary
(1991)
estimated t h a t 805,000 SSDI b e n e f i c i a r i e s would be i n the
Medicare w a i t i n g period i n 1991.
I t would c o s t about $150
m i l l i o n f o r Medicaid t o purchase COBRA premiums and $100 m i l l i o n
to pay f o r the d e d u c t i b l e s and coinsurance for the SSDI
b e n e f i c i a r i e s with incomes below the poverty
C.
levels.
Medicare
Option 5:
Permit S o c i a l S e c u r i t y D i s a b i l i t y Insurance
(SSDI)
b e n e f i c i a r i e s with AIDS t o purchase Medicare during the two year
w a i t i n g period.
Require Medicaid t o purchase Medicare
coverage
for poor SSDI b e n e f i c i a r i e s .
1.
Impact
T h i s option would allow an estimated 10,506 SSDI
b e n e f i c i a r i e s with AIDS t o purchase Medicare coverage,
estimated 4,860 would be bought i n by Medicaid
purchase Medicare on t h e i r own.
of whom an
and 5,646 would
Once e l i g i b l e f o r SSDI, t h e
60
�i n d i v i d u a l would immediately
be allowed to purchase Medicare
coverage without having to wait the 24 month waiting period.
The
annual c o s t to the b e n e f i c i a r y would be $3,559, the f u l l
a c t u a r i a l c o s t , f o r Medicare Part A, H o s p i t a l Insurance and Part
B, Supplemental Medical Insurance premiums.
I n addition,
b e n e f i c i a r i e s would be l i a b l e for Medicare c o s t - s h a r i n g and
covered s e r v i c e s such as p r e s c r i p t i o n drugs.
non-
The c o s t to
b e n e f i c i a r i e s i s , t h e r e f o r e , estimated at $9,600 annually.
I n d i v i d u a l s with incomes above the f e d e r a l poverty l e v e l would be
expected to make these payments.
I t i s estimated t h a t 3 5 percent
of the SSDI b e n e f i c i a r i e s would take advantage of t h i s option.
There are s i g n i f i c a n t gaps and c o s t - s h a r i n g i n the
coverage
provided by Medicare, which would put a heavy f i n a n c i a l burden on
many i n d i v i d u a l s purchasing Medicare under t h i s option.
S p e c i f i c a l l y , the out-of pocket c o s t s for H o s p i t a l Insurance
include a deductible of $628 per s p e l l of i l l n e s s .
a l s o out-of-pocket
coverage
There are
c o s t s for Supplementary Medical Insurance, the
f o r p h y s i c i a n and r e l a t e d s e r v i c e s , which include a
premium of $359 per year, a deductible of $100 per year and
coinsurance of 20 percent of the allowable Medicare charge
( f i g u r e s are e f f e c t i v e as of January 1, 1991)
(U.S.
Congress,
Green Book, 1991).
Under Medicare P a r t A i n d i v i d u a l s would be covered for
i n p a t i e n t h o s p i t a l care, some i n p a t i e n t s k i l l e d nursing f a c i l i t y
care, home h e a l t h care and hospice c a r e , while under P a r t B they
would be covered f o r p h y s i c i a n s e r v i c e s , outpatient h o s p i t a l
61
�s e r v i c e s , d u r a b l e m e d i c a l equipment and o t h e r m e d i c a l s e r v i c e s
and s u p p l i e s .
However, i n d i v i d u a l s would n o t be covered f o r
p r e s c r i p t i o n drugs, d e n t a l c a r e , eyeglasses and a v a r i e t y o f l o n g
term c a r e s e r v i c e s .
The l a c k o f p r e s c r i p t i o n drug coverage would
be p a r t i c u l a r l y s i g n i f i c a n t f o r some i n d i v i d u a l s because t h e
average annual c o s t o f p r e s c r i p t i o n drugs i s $4,400 p e r y e a r f o r
a person w i t h AIDS ( H e l l i n g e r , 1991).
D e s p i t e t h e s e l i m i t a t i o n s i n b e n e f i t s , Medicare coverage
w i l l be a t t r a c t i v e t o many SSDI b e n e f i c i a r i e s .
Many a r e
u n i n s u r e d and unable t o o b t a i n p r i v a t e h e a l t h i n s u r a n c e coverage.
W i t h o u t Medicare t h e y w i l l be q u i c k l y d r i v e n i n t o p o v e r t y o r r i s k
d o i n g w i t h o u t needed c a r e .
A f u r t h e r b e n e f i t o f t h i s o p t i o n i s t h a t t h e reimbursement
r a t e s a r e h i g h e r t h a n under M e d i c a i d , which would a c t as an
i n c e n t i v e f o r physicians t o provide ambulatory care t o
i n d i v i d u a l s w i t h HIV d i s e a s e .
C u r r e n t l y , an employer d i s c o n t i n u e s COBRA f o r persons
e l i g i b l e f o r Medicare.
COBRA laws w i l l need t o be amended under
t h i s o p t i o n t o r e q u i r e employers t o c o n t i n u e o f f e r i n g COBRA
i n s u r a n c e f o r t h o s e persons w i t h AIDS f o r 29 months.
premiums a t an average o f $1,862 (Gabel, e t a l ,
COBRA
1990) a r e l o w e r
t h a n t h e Medicare premiums o f $3,559. A l s o , most o f t h e employer
h e a l t h p l a n s cover p r e s c r i p t i o n d r u g s , which Medicare does n o t .
T h e r e f o r e , i t i s l i k e l y t o be more a t t r a c t i v e t o t h o s e who have
the
o p t i o n o f COBRA coverage t o r e t a i n such coverage, r a t h e r t h a n
p u r c h a s i n g Medicare.
62
�2.
Cost
The cost of t h i s option to the Medicare program i s $220
million, over and above payments paid by beneficiaries through
premiums, deductibles, and co-insurance.
This net cost to
Medicare occurs because the premium i s based on the average cost
of Medicare coverage for a l l beneficiaries.
The actual cost for
SSDI persons with AIDS i s expected to exceed t h i s average cost,
resulting in a net subsidy.
There i s a net savings to Medicaid of $78 million.
This i s
a result of Medicaid being used to purchase Medicare premiums for
those individuals e l i g i b l e for Medicaid.
Medicaid would continue
to be used for paying coinsurance, deductibles and for items not
covered by Medicare, such as drugs for those individuals with
incomes below 100% of poverty.
Of the $78 million savings,
approximately $4 0 million would be federal dollars, and $38
million state dollars.
3.
Equitable Treatment of non-HIV Disease Disabled Populations
This option could be extended to other SSDI beneficiaries.
Since a l l SSDI beneficiaries are seriously disabled, they should
be permitted the option of purchasing Medicare by paying the f u l l
a c t u a r i a l cost of coverage during the two year waiting period.
This would extend coverage to an estimated 355,000 persons at an
annual cost to Medicare of $1.2 b i l l i o n and to Medicaid of $900
million, to cover those with incomes below poverty l e v e l .
Option 6:
Allow a l l individuals with AIDS to purchase Medicare.
For individuals with incomes below the federal poverty level
63
�Medicaid would pay t h e Medicare premiums, d e d u c t i b l e s and
coinsurance.
1.
Impact
T h i s o p t i o n i s broader t h a n O p t i o n 6 i n t h a t i t would p e r m i t
any i n d i v i d u a l w i t h AIDS, n o t j u s t t h o s e w i t h a work h i s t o r y
q u a l i f y f o r SSDI, t o purchase Medicare.
who
Under t h i s o p t i o n a
s i g n i f i c a n t p o r t i o n o f t h e AIDS p o p u l a t i o n would r e c e i v e Medicare
coverage.
C u r r e n t l y o n l y 3,100
persons w i t h AIDS a r e e s t i m a t e d
t o have Medicare (HCFA, 1990).
A t o t a l o f 52,071 persons would
be e n r o l l e d i n 1991, o f which 4 0,800 would be persons bought i n
by M e d i c a i d and 11,271 would purchase Medicare on t h e i r own.
Of
t h e persons bought i n by M e d i c a i d , 34,000 would have had p r i o r
M e d i c a i d coverage.
Once diagnosed w i t h AIDS, t h e i n d i v i d u a l would i m m e d i a t e l y
be a l l o w e d t o purchase Medicare coverage w i t h o u t h a v i n g t o w a i t
29 months, which i s c u r r e n t l y t h e p r a c t i c e f o r i n d i v i d u a l s
e l i g i b l e f o r SSDI w a n t i n g t o g a i n Medicare coverage.
The annual
c o s t t o t h e b e n e f i c i a r y would be $3,559, t h e f u l l a c t u a r i a l
f o r Medicare P a r t A and P a r t B premiums.
cost,
In addition,
b e n e f i c i a r i e s would be l i a b l e f o r Medicare c o s t - s h a r i n g and noncovered s e r v i c e s .
I n c l u d i n g t h e purchase o f p r e s c r i p t i o n drugs
o f $4,400 which a r e n o t covered by Medicare, t h e c o s t t o
b e n e f i c i a r i e s i s t h e r e f o r e e s t i m a t e d a t $9,600 a n n u a l l y .
For
those i n d i v i d u a l s w i t h o u t supplemental Medicaid f i n a n c i n g
this
c o u l d p r o v e t o be a heavy f i n a n c i a l burden.
I n d i v i d u a l s would
r e c e i v e t h e same Medicare coverage as d i s c u s s e d i n o p t i o n 5.
64
�Again as d i s c u s s e d under o p t i o n 5, an added b e n e f i t o f t h i s
o p t i o n i s t h a t p r o v i d e r reimbursement r a t e s a r e h i g h e r t h a n under
M e d i c a i d , which would a c t as an i n c e n t i v e f o r p h y s i c i a n s t o t r e a t
i n d i v i d u a l s w i t h AIDS o r HIV i n f e c t i o n .
Individuals previously
h a v i n g M e d i c a i d coverage would have i n c r e a s e d access t o c a r e as a
result.
2.
Cost
Under t h i s o p t i o n . M e d i c a i d would save a t o t a l o f $497
m i l l i o n and Medicare would spend an a d d i t i o n a l $1.1 b i l l i o n .
The
F e d e r a l government would share i n 51 p e r c e n t o f t h e M e d i c a i d
s a v i n g s , o r $253 m i l l i o n .
The s a v i n g s t o M e d i c a i d occur because
many poor d i s a b l e d persons w i t h HIV d i s e a s e who a r e c u r r e n t l y
covered by M e d i c a i d would now be covered by Medicare.
Medicaid
would pay t h e Medicare premium, b u t t h i s premium s h o u l d be
s u b s t a n t i a l l y l e s s t h a n t h e a c t u a l c o s t o f care c u r r e n t l y
p r o v i d e d by M e d i c a i d .
3.
E q u i t a b l e Treatment o f non-HIV Disease D i s a b l e d P o p u l a t i o n s
T h i s o p t i o n c o u l d be extended t o a l l d i s a b l e d persons.
There a r e c u r r e n t l y about 2.9 m i l l i o n d i s a b l e d persons who do n o t
r e c e i v e SSDI payments o r r e c e i v e SSDI payments b u t a r e i n t h e 24
month w a i t i n g p e r i o d f o r Medicare.
The c o s t s o f e x t e n d i n g t h i s
o p t i o n t o a l l o f t h e s e d i s a b l e d persons would be $11.1 b i l l i o n
f o r M e d i c a i d and $4.8 b i l l i o n f o r Medicare.
O p t i o n 7: E l i m i n a t e t h e c u r r e n t two-year w a i t i n g p e r i o d f o r SSDI
b e n e f i c i a r i e s w i t h AIDS t o r e c e i v e Medicare.
Medicaid
supplements Medicare coverage f o r poor SSDI b e n e f i c i a r i e s .
65
�1.
Impact
This option d i f f e r s from Option 5 in that i t automatically
extends Medicare coverage to a l l SSDI beneficiaries, without
requiring them to pay the f u l l actuarial premium of $3,559.
Instead beneficiaries would be charged a much more modest Part B
annual premium of $359.
Under t h i s option an estimated 26,999 individuals with AIDS
qualifying for SSDI benefits would immediately be covered by
Medicare, without having to wait the two-year waiting period.
This option focuses on a population with a c l i n i c a l diagnosis of
AIDS, rather than a l l individuals with HIV disease.
Individuals
are automatically enrolled in Part A without a premium.
They
would have the option of purchasing Part B for only $29.90 a
month ($359 annual) which i s a fourth of the actuarial value.
This i s a significant benefit and a l l persons with AIDS can be
expected to purchase Part B coverage.
Individuals with incomes above the federal poverty l e v e l
would be expected to contribute to the coinsurance and deductible
for Medicare Part A and the premium, coinsurance and deductible
for Part B.
However, for individuals with incomes below the
federal poverty level Medicaid financing would be available to
cover the coinsurance, deductibles and premium.
Of the estimated
26,999 SSDI beneficiaries, who would be e l i g i b l e , 4,860 would be
poor and would qualify for Medicaid assistance.
Of these 4,860,
3,888 would have already been on Medicaid and would continue to
receive a l l Medicaid services.
66
�I n a d d i t i o n , i n d i v i d u a l s could e l e c t t o continue t h e i r
employer sponsored i n s u r a n c e coverage t o supplement Medicare
benefits.
The employer p l a n would serve as a secondary payer,
c o v e r i n g premiums, d e d u c t i b l e s , c o i n s u r a n c e , and o t h e r noncovered Medicare expenses.
COBRA would have t o be amended t o
accommodate t h i s o p t i o n .
I n d i v i d u a l s would be e l i g i b l e f o r t h e b e n e f i t s covered under
Medicare as d e s c r i b e d i n o p t i o n s 5 and 6.
T h i s means t h a t t h e y
would n o t be covered f o r p r e s c r i p t i o n drugs, d e n t a l c a r e ,
eyeglasses and a v a r i e t y o f l o n g t e r m care s e r v i c e s u n l e s s t h e y
had supplemental coverage.
Again as i n o p t i o n s 5 and 6, t h e l a c k
o f p r e s c r i p t i o n drug coverage c o u l d be p a r t i c u l a r l y
significant
f o r some i n d i v i d u a l s because t h e average annual c o s t o f
p r e s c r i p t i o n drugs i s $4,400 per year f o r persons w i t h AIDS.
A l s o as d i s c u s s e d e a r l i e r an added b e n e f i t o f t h i s o p t i o n i s t h a t
t h e reimbursement r a t e s are h i g h e r t h a n under Medicare, which
would a c t as an i n c e n t i v e f o r p h y s i c i a n s t o t r e a t
w i t h AIDS o r HIV
individuals
infection.
Employers a l s o would b e n e f i t from t h i s o p t i o n .
Currently,
i n d i v i d u a l s may c o n t i n u e t h e i r coverage under employer sponsored
i n s u r a n c e p l a n s f o r 29 months.
Under t h i s o p t i o n , t h e employer
p l a n s would become secondary payers, r e d u c i n g t h e f i n a n c i a l
assumed under t h e s e p l a n s .
Medicare would cover more o f t h e
c o s t s n o t covered by t h e employer sponsored i n s u r a n c e p l a n s .
67
risk
�2.
Cost
By e l i m i n a t i n g the Medicare w a i t i n g period, the c o s t t o the
Medicare program would be $658 m i l l i o n i n FY 1991 d o l l a r s t o
cover persons with AIDS.
The net savings to Medicaid would be
$127 m i l l i o n s i n c e Medicare coverage would r e p l a c e some e x i s t i n g
Medicaid coverage f o r the poor d i s a b l e d .
Of t h i s , the f e d e r a l
Medicaid program would save $65 m i l l i o n , with s t a t e s saving $62
million.
3.
E q u i t a b l e Treatment of non-HIV Disease Disabled
Populations
T h i s option could be extended to a l l SSDI b e n e f i c i a r i e s .
The estimated c o s t of e l i m i n a t i n g the two-year w a i t i n g period f o r
a l l SSDI b e n e f i c i a r i e s i s $6.1 b i l l i o n i n calendar year 1991
(HCFA, 1991).
D.
P r i v a t e Health
Option 8:
Insurance
Reform of employer provided group h e a l t h insurance
b e n e f i t s t o p r o h i b i t : s e t t i n g higher premiums f o r persons
b e l i e v e d t o be a t r i s k f o r AIDS; l i m i t i n g b e n e f i t s on the b a s i s
of HIV d i s e a s e d i a g n o s i s ; e s t a b l i s h i n g w a i t i n g periods f o r
coverage or p r e - e x i s t i n g condition under employer-provided groups
h e a l t h b e n e f i t s ; or r e f u s i n g to i s s u e or renew coverage on
grounds of r i s k f o r HIV d i s e a s e .
1.
Impact
T h i s option a f f e c t s p r i m a r i l y s m a l l e r firms with fewer than
25 employees.
Only 20 percent of firms with more than 100
employees have a w a i t i n g period f o r p r e - e x i s t i n g c o n d i t i o n s and
l e s s than one percent do not cover p r e - e x i s t i n g c o n d i t i o n s (BLS,
68
�1990) . With some exceptions, larger firms do not exclude
employees with HIV disease from their health plans or try to
l i m i t t h e i r benefits. Charges for medical treatment for a person
with AIDS i s estimated to be $35,200 per year and medical
treatment for persons with HIV infection i s estimated to be
$5,603 i n 1991.
For smaller firms, covering even one or two
employees with AIDS would increase the average cost of the health
plan substantially.
To avoid major premium increases, therefore,
the reforms would not permit premiums to vary on the basis of HIV
disease r i s k or experience.
I f premiums could not increase for actual medical claims due
to HIV disease, these claims would have to be spread among a l l
small group insurers.
Unless the increased claims could be
subsidized by other markets of the insurers, small group rates
would have to increase, leading some firms to drop t h e i r
insurance.
I f insurers did not spread the cost over a l l small
groups nationwide but increase premiums more i n certain c i t i e s or
industries, more firms would drop their insurance.
This option could have undesirable side effects.
Firms are
not required to offer coverage to t h e i r workers and any increase
in premiums may cause them to drop coverage or reduce benefits.
Furthermore,
insurance companies are l i k e l y to attempt to subvert
the regulations by selective marketing practices that discourage
firms at r i s k from purchasing
coverage.
69
�2^
Cost
There i s no d i r e c t
f e d e r a l cost involved i n t h i s o p t i o n .
However, i f t h e r e are s i g n i f i c a n t
numbers o f employees who
u n i n s u r e d , uncompensated care would grow and Medicaid
become
and
other
p u b l i c programs would have more b e n e f i c i a r i e s .
3.
E q u i t a b l e Treatment o f non-HIV Disease D i s a b l e d
Populations
There are o t h e r d i s a b l e d persons w i t h medical c o n d i t i o n s
which are l i k e l y t o be excluded by s m a l l group i n s u r e r s .
If all
d i s a b l e d employees had t o be i n c l u d e d i n h e a l t h p l a n s , premiums
would have t o i n c r e a s e s i g n i f i c a n t l y , l e a d i n g many f i r m s t o drop
t h e i r insurance
E.
plans.
I n c r e a s e i n P r o v i d e r Funding
O p t i o n 9:
Increase a p p r o p r i a t i o n s t o the f u l l a u t h o r i z e d
level
under t h e Ryan White Comprehensive AIDS Resources Emergency
(CARE) A c t o f
1.
1990.
Impact
The
l e g i s l a t i o n a u t h o r i z e s $275 m i l l i o n i n emergency r e l i e f
a i d f o r h i g h prevalence
c i t i e s and s t a t e s ( T i t l e s I , I I ) , $275
m i l l i o n f o r p r e v e n t i v e and p r i m a r y care
( T i t l e I I I ) , and
$325 m i l l i o n f o r HIV c o u n s e l i n g , t e s t i n g ,
p e d i a t r i c AIDS r e s e a r c h
(Title IV).
R e c o n c i l i a t i o n A c t o f 1990
another
drug i n t e r v e n t i o n
and
However, t h e Budget
cut funding
substantially,
a p p r o p r i a t i n g o n l y $221 m i l l i o n o u t o f t h e a u t h o r i z e d $875
million.
Money was
r e l e a s e d f o r r e l i e f t o c i t i e s and
f i r s t , w i t h t h e n e x t r e l e a s e o f funds
($46 m i l l i o n )
states
i n the Spring
o f 1991 t o be d i r e c t e d a t p r e v e n t i v e s e r v i c e s under T i t l e I I I .
70
�This r e l i e f , at least at s u f f i c i e n t funding levels, w i l l
provide needed economic assistance to areas of high AIDS
prevalence.
I n i t i a l r e l i e f to a s s i s t hospitals in providing
outpatient care w i l l greatly reduce the economic burden they face
in providing care to a large number of AIDS patients.
I t will
provide economic support to institutions currently offering a
variety of special services including those services which
u t i l i z e an interdisciplinary team of subspecialists.
However, a c r i t i c a l portion of the law i s T i t l e I I I which
funds preventive care for persons with AIDS through categorical
grants to outpatient c l i n i c s and formula grants for HIV testing
and counseling.
That preventive services are not reaching AIDS
patients and many of those infected with HIV i s reflected i n the
fact that many of these patients i n i t i a l l y present with a variety
of preventable i l l n e s s e s such as PCP.
T i t l e I I I w i l l help fund essential preventive services for
some portion of the AIDS population.
Of the two grant processes,
the most important are the categorical grants.
These provide
f i n a n c i a l support for primary care and preventive services at
migrant/community health centers and community c l i n i c s .
These
primary care settings are most l i k e l y to undergo funding cuts, i f
they occur at the state l e v e l .
On the other hand, formula grants
provide funding for testing and counseling, issues with greater
p o l i t i c a l support at the state level and therefore issues which
are l e s s l i k e l y to undergo s i g n i f i c a n t budget cuts.
71
Thus the
�c a t e g o r i c a l g r a n t s are c e n t r a l t o i n s u r i n g t h a t p r e v e n t i v e
s e r v i c e s be d e l i v e r e d .
Areas o f g r e a t e r AIDS p r e v a l e n c e are a l s o more l i k e l y t o be
areas w i t h l a r g e numbers o f u n i n s u r e d
who
and
indigent individuals
l a c k t h e necessary support system f o r p r o v i d i n g e v o l v i n g care
w i t h AIDS and who
may
and s o c i a l problems.
have a v a r i e t y o f o t h e r p r e s s i n g m e d i c a l
Thus, i t i s i m p o r t a n t t h a t t h e T i t l e
III
g r a n t process assure t h a t g r a n t e e s demonstrate t h a t t h e y are p a r t
o f a l a r g e r , more comprehensive care system capable o f d i r e c t l y
p r o v i d i n g a range o f s e r v i c e s along a continuum o f d i s e a s e so
c h a r a c t e r i s t i c o f HIV disease,
or are capable o f e f f e c t i v e l y
r e f e r r i n g p a t i e n t s f o r a d d i t i o n a l s e r v i c e s i n o t h e r care
settings.
W i t h more a g g r e s s i v e
p r e v e n t i v e care
i n t e r r e l a t e d sources o f c a r e — f r o m
through
mental h e a l t h , c o u n s e l i n g ,
c l i n i c a l s e r v i c e s — m a n y c o s t l y h o s p i t a l admissions can
and
be
avoided.
T h i s o p t i o n does n o t p r o v i d e f u n d i n g f o r d i r e c t i n p a t i e n t
care ( a l t h o u g h i n p a t i e n t case management i s p e r m i t t e d )
and
t h e r e f o r e h o s p i t a l s w i t h l a r g e numbers o f AIDS admissions w i l l
still
s u f f e r economic h a r d s h i p .
However, r e l i e f d i r e c t e d a t
o u t p a t i e n t care should enable t h e s e i n s t i t u t i o n s t o s h i f t some
f u n d i n g back t o f i n a n c e i n p a t i e n t c a r e .
Since t h i s o p t i o n b r i n g s an i n f u s i o n o f funds i n t o c u r r e n t l y
economically
deprived
i n s t i t u t i o n s and uses h o s p i t a l s , c l i n i c s ,
community based o r g a n i z a t i o n s , and M/CHCs a l r e a d y s e r v i n g h i g h
p r e v a l e n c e communities, i t s i m p l e m e n t a t i o n
72
could occur q u i c k l y
�and reach populations i n need f a s t e r than those that r e l y on
i n d i r e c t i n c e n t i v e s to serve these
populations.
A d d i t i o n a l i n c e n t i v e s f o r providers working i n M/CHC and
community-based organizations g i v i n g primary care s e r v i c e s to
AIDS/HIV p a t i e n t s can be obtained through q u a l i f y i n g the center
or c l i n i c as a F e d e r a l l y Q u a l i f i e d Health Center (FQHC).
Centers
which q u a l i f y as FQHCs may then r e c e i v e reimbursement under
Medicaid a t 100 percent of reasonable charges.
Such an enhanced
reimbursement package w i l l serve as a b e t t e r i n c e n t i v e to help
r e t a i n p h y s i c i a n s a t these c e n t e r s .
This i s p a r t i c u l a r l y
a t t r a c t i v e because the centers may q u a l i f y e s s e n t i a l l y by
providing
primary care to the general p u b l i c .
I n addition,
current l e g i s l a t i o n i s pending before Congress which would amend
the law t o allow Ryan White grantees which d i d not provide nonHIV primary care to q u a l i f y as FQHCs.
T h i s amendment would
f u r t h e r broaden access to care for many HIV d i s e a s e p a t i e n t s .
2.
Cost
F u l l funding of the CARE Act would i n c r e a s e f e d e r a l
budgetary o u t l a y s by $654 m i l l i o n annually.
However, the amount
of money needed to provide adequate economic r e l i e f to h o s p i t a l s
and other providers s e r v i n g a disproportionate
share of HIV
d i s e a s e care t o p a t i e n t s i s not d i r e c t l y c a l c u l a b l e f o r l a c k of
comprehensive data.
One low estimate of the l e v e l of r e l i e f f o r h o s p i t a l s may be
developed by blending outpatient h o s p i t a l u t i l i z a t i o n p a t t e r n s of
uninsured AIDS p a t i e n t s (Andrulis e t a l . , 1987) with estimates of
73
�h o s p i t a l c o s t s f o r outpatient care of AIDS p a t i e n t s ( H e l l i n g e r
1988a).
Using t h i s approach, 57 percent
(19,185) of outpatient
v i s i t s i n 1987 i n a small sample (70 h o s p i t a l s ) of
p u b l i c / t e a c h i n g h o s p i t a l s and 17 percent
(1,214) of outpatient
v i s i t s i n p r i v a t e h o s p i t a l s were c l a s s i f i e d as " s e l f pay"
(Andrulis e t a l . , 1987).
H e l l i n g e r estimates t h a t
annualized
outpatient care f o r AIDS p a t i e n t s was $4,400 i n 1991.
To
r e l i e f f o r c o s t s due to outpatient care f o r the uninsured
provide
in this
small sample (70 h o s p i t a l s ) would then approach $84.4 m i l l i o n f o r
p u b l i c / t e a c h i n g h o s p i t a l s and an a d d i t i o n a l $5.3 m i l l i o n f o r
p r i v a t e h o s p i t a l s , or a t o t a l of $89.8 m i l l i o n .
After adjusting
for i n f l a t i o n t h i s would t o t a l $144.6 m i l l i o n (1992 d o l l a r s ) .
Thus the a c t u a l amount needed to provide
r e l i e f to the f u l l
number of h o s p i t a l s providing the g r e a t e s t share of care f o r AIDS
p a t i e n t s would be s u b s t a n t i a l l y g r e a t e r than t h i s f i g u r e , which
r e f l e c t s the c o s t s to only 70 of the country's
over 6000
hospitals.
Regarding Migrant/Community Health Centers, the National
A s s o c i a t i o n of Community Health Centers has estimated
t h a t the
c o s t of providing care f o r a l l p a t i e n t s known to have HIV
i n f e c t i o n , AIDS r e l a t e d complex or AIDS was $1.3 b i l l i o n i n 1989.
Although the insurance s t a t u s of these i n d i v i d u a l s i s not known,
approximately 49 percent of a l l p a t i e n t s v i s i t i n g these
are reported to be uninsured
(NACHC, 1991).
centers
The amount of r e l i e f
to finance preventive s e r v i c e s and primary care would t o t a l a t
l e a s t $824.9 m i l l i o n (1992 d o l l a r s ) .
74
T h i s does not r e f l e c t the
�amount of r e l i e f that would be necessary to a s s i s t other
community c l i n i c s and primary care e n t i t i e s .
Thus the funds necessary to achieve the goals of the CARE
Act would exceed $1 b i l l i o n . Bringing funding up to current
authorization levels would cost $654 million annually.
F.
Drugs
Option 10: The federal government should undertake through the
Department of Health and Human Services a consolidated purchase
and distribution of drugs used i n the prevention and treatment of
HIV disease.
1.
Impact
This option would enable the federal government to negotiate
reduced costs for HIV disease drugs by offering pharmaceutical
manufacturers volume sales.
This could be done through a federal
agency, such as the CDC, or through the Medicaid program.
are a number of precedents for t h i s type of approach.
There
This type
of purchasing policy could be modelled after the federal purchase
of childhood vaccines.
The federal government, through CDC, buys
childhood vaccines through a mechanism of negotiated, open-ended
contracts with large guaranteed minimum purchases.
CDC offers
t h i s consolidated purchase option to the states on a voluntary
basis.
A l l f i f t y states have opted to be a part of the program.
By purchasing i n bulk the cost of a complete vaccination s e r i e s
i s reduced by approximately 4 0 percent per c h i l d over the private
sector cost (CDC, 1991).
Table 4 compares the 1991 CDC cost i n
dollars per dose of four standard pediatric vaccines to the
75
�private sector cost.
I t i s important to note that MMR
and OPV
are currently produced under monopoly protection, and yet they
s t i l l provide significant price savings through t h i s program.
The consolidated purchase of vaccine was i n i t i a t e d by CDC in
1962 as a public health measure to improve the vaccine coverage
of American children.
Consolidated purchase of HIV drugs, and in
particular those agents used in early intervention, would also
have important public health implications.
Early intervention
has been shown to reduce hospitalizations and to help prevent
l i f e threatening infections, such as PCP (Arno, 1990).
Lack of
access to early intervention, because of the i n a b i l i t y to pay for
medication, remains a significant barrier to care for the
uninsured.
They would be expected to benefit considerably from
t h i s program.
Under the federally-funded AIDS Drug Assistance Program
(ADAP) some state governments have taken steps to provide
financing for costly AIDS drugs.
Maryland, for example, has
i n i t i a t e d the Maryland AIDS Drugs Assistance Program (MADAP),
which supplies three drugs (AZT, pentamidine and alphainterferon) to state residents who cannot afford them and who are
either awaiting Medicaid coverage or do not qualify for i t
because of incomes above indigence in the state.
MADAP benefits
the uninsured population in Maryland whose incomes are above
poverty l e v e l and allows recipients to continue working while
they are able.
Presently, t h i s program pays the f u l l
manufacturer r e t a i l price for the three agents and works with
76
�local pharmacies.
With passage of the Ryan White Act, ADAP was
replaced with funding p r i n c i p a l l y through T i t l e I I of the Ryan
White Act.
Medicaid programs in the states which pay for prescription
drugs currently pay the f u l l r e t a i l price for HIV drugs.
consolidated
With
purchase, state Medicaid programs could supply
Medicaid recipients with their medications at a negotiated
reduced rate.
Drug distribution could be done at STD
clinics,
state or municipal public c l i n i c s , and Maternal and Child Health
clinics.
Since 40 percent of AIDS patients, and 90 percent of
children with AIDS, are currently covered through the Medicaid
programs (HCFA, 1990), the federal government and state
governments could both be expected to save considerable
sums on
drug costs for Medicaid recipients.
A consolidated
purchase and distribution approach does not
reform the Orphan Drug Act or a l t e r the incentives provided under
t h i s Act for research on drugs for rare diseases with small
markets.
While some a n t i - r e t r o v i r a l agents, such as
dideoxyinosine, and dideoxycytidine,
AZT,
are l i k e l y to have large
markets many AIDS related infections, such as cryptosporidiosis,
mycobacterium avium-intracellular, remain r e l a t i v e l y rare.
Without the incentives of the Orphan Drug Act, research on these
and other rare diseases may
be curtailed.
This problem was
recognized by the Presidential Commission on the HIV Epidemic in
t h e i r report to the President in
77
1988.
�In terms of f e a s i b i l i t y t h i s approach has two strengths.
F i r s t , there are considerable precedents, such as the federal
vaccine program, and the p a r a s i t i c diseases program, for
consolidated purchase.
Second, the ADAP program has increased
access to AIDS drugs to uninsured populations which otherwise
would not receive them, suggesting that consolidated purchase
could actually increase sales of AIDS drugs.
Thus, the
pharmaceutical manufacturers may be more w i l l i n g to support
this
type of program than one which would approach cost containment by
price c e i l i n g s or reform of the Orphan Drug Act.
2.
Cost
Administrative cost would depend on the structure of a
consolidated purchase program.
Savings on consolidated purchase
would be dependent upon negotiations with the
manufacturers.
Evidence from the consolidated purchase of vaccines suggests that
savings could be considerable.
3.
Equitable Treatment of non-HIV Disease Disabled
Populations
This option i s HIV disease s p e c i f i c and would have only
indirect effects on other prescription drug buyers.
The
principle behind t h i s option, however, could be generalized for
other populations.
Option 11;
Reform of the Orphan Drug Act with a sales and/or a
p r o f i t cap.
1.
Impact
Although the stated purpose of the Orphan Drug Act of
1983
was to encourage research and development of drugs with limited
78
�financial expectations, the protection offered by the Orphan Drug
Act
has allowed some orphan drugs to become markedly
profitable.
Frequently cited examples of drugs granted orphan
status which have subsequently generated considerable sales and
p r o f i t s include AZT, aerosolized pentamidine, recombinant human
growth hormone, and recombinant erthopoeiten (EPO) (Theone,
1991).
AZT and aerosolized pentamidine are used in AIDS, EPO,
while principally a drug for End Stage Renal Disease patients, i s
also used to treat HIV-related anemia.
Of these drugs only
pentamidine (with 1990 sales estimated at $480 million) would be
affected by reform of the orphan drug law since the others are
protected by patent law beyond the seven year exclusivity of
orphan status (Asbury, 1991).
Reform of the Orphan Drug Act,
however, might affect other drugs s t i l l under research, as well
as
orphan drugs used in other diseases.
Reform of the Orphan Drug Act through a sales or p r o f i t s cap
l i m i t has a number i f implications.
I t would deny orphan status
once a drug had proven to be profitable, thereby, retaining
orphan status for unprofitable drugs and returning the use of the
law to i t s original intent.
Further, by preserving orphan status
u n t i l a drug achieved p r o f i t a b i l i t y , manufacturers would s t i l l be
protected through the research and development phases of a new
drug for a rare disease, thus research incentives would not be
lost.
For a previously approved drug granted orphan status for a
new indication, as was the case with pentamidine, the loss of
orphan status once p r o f i t a b i l i t y was established would mean the
79
�l o s s of e x c l u s i v i t y for that drug and
for t h a t i n d i c a t i o n .
Market f o r c e s would then be expected to lower c o s t s .
This
approach has the advantage over a population l i m i t for orphan
drugs i n t h a t i t i s based on a demonstrable endpoint ( p r o f i t s or
s a l e s ) , whereas population t a r g e t s are l i k e l y to be based on
f i g u r e s (such as the number of HIV
to considerable
debate.
suggested by the National
2.
infected individuals) subject
A s a l e s cap of $150
Organization
m i l l i o n has been
of Rare Diseases
Cost
T h i s option could r e s u l t i n considerable
payers of AIDS and HIV drugs.
administrative
savings
for a l l
Savings on pentamidine alone could
amount to $900 per p a t i e n t per year.
3.
(NORD).
There would be minimal
cost.
Equitable Treatment of non-HIV Disease
Disabled
Populations
T h i s option would not be HIV d i s e a s e s p e c i f i c and would be
expected to b e n e f i t any p a t i e n t group r e q u i r i n g an expensive
orphan drug whose p r i c e was
a f f e c t e d by the amendment.
An
example would be End Stage Renal Disease p a t i e n t s r e q u i r i n g
EPO.
Option 12: Place a p r i c e c e i l i n g on drugs used i n the treatment
of HIV
1.
disease.
Impact
A p r i c e c e i l i n g on HIV drugs could amount to s u b s t a n t i a l
savings
for a l l buyers of these agents.
Reasonably s e t p r i c e s
might be expected to i n f l u e n c e p a t i e n t s to seek e a r l y
i n t e r v e n t i o n , might i n c r e a s e the number of p r i v a t e i n s u r e r s
w i l l i n g to i n s u r e HIV
i n f e c t e d i n d i v i d u a l s , and could
80
allow
�Federal monies allocated for HIV disease care to be used i n other
HIV-related services.
Since many drugs are used both i n early
intervention and in treatment of AIDS, t h i s option could reduce
the cost of treatment throughout the spectrum of HIV disease.
Prices could be set by mandate, after negotiation with
manufacturers.
These c e i l i n g s would i n i t i a l l y l i m i t p r o f i t
margins, but might also encourage efficiency.
Such price
c e i l i n g s would have to be negotiated for each drug, or c l a s s of
drugs, and the process could potentially be complex.
However,
incentives to develop drugs for the less common opportunistic
infections associated with HIV disease may be l o s t .
2.
Cost
The cost of t h i s option would depend on the price c e i l i n g
l e v e l s set and would be borne by the manufacturers.
3.
Equitable Treatment of non-HIV Disease Disabled Populations
These price c e i l i n g s would be HIV-specific and would have
only indirect effects on other prescription drug buyers.
VI.
Summary and Conclusions
The nation urgently needs to address the health care
problems of a l l Americans by supporting universal health
insurance.
Without t h i s action, the ranks of the uninsured and
the underinsured w i l l continue to grow.
Action i s p a r t i c u l a r l y
urgent i n the case of persons with HIV disease.
They face
serious f i n a n c i a l barriers to care without comprehensive health
insurance.
Opportunities for HIV disease education, prevention,
counselling, and early intervention w i l l continue to be missed,
81
�and acutely i l l individuals with HIV disease or other i l l n e s s e s
w i l l increasingly turn to already overburdened public and quasipublic hospitals, requiring expensive care that would have been
unnecessary had they been able to afford simple primary care.
While the primary solution to t h i s problem i s the enactment
of universal health insurance, i t i s u n r e a l i s t i c to assume that
t h i s w i l l ensure timely r e l i e f .
More modest steps must be taken
during the interim to close the gaps in health care financing for
those with HIV disease and others who are chronically i l l and
experience catastrophically expensive health care.
These steps
should build on existing programs such as Medicare, Medicaid, and
the Ryan White Act, which already provide limited assistance.
Such steps are within our economic and administrative capability
and should be a top p r i o r i t y for policy attention.
With the exception of universal health insurance, a l l of the
policy options set forth deal with only a part of the f a i l u r e of
the U.S.
health system to assure adequate protection for the cost
of health care to a l l Americans.
Even as applied to persons with
HIV disease, they f a l l far short of meeting the complete needs
for coverage of health and long-term care services. However,
they are essential stop-gap measures which show promise of
providing at least some immediate assistance to an extremely
vulnerable population group.
A.
Universal Health
Insurance
D i s s a t i s f a c t i o n with incremental and piecemeal approaches to
addressing gaps in the current U.S.
82
health financing system have
�led to serious proposals for fundamental reform. The Bipartisan
Commission on Comprehensive Health Care, called the Pepper
Commission, has issued a major report c a l l i n g for a mixed publicprivate approach to health financing.
This Commission, chaired
by Senator Jay Rockefeller (D.-W.Va.) and including many health
leaders i n the Congress, has focused greater attention on the
need for universal health insurance coverage.
Since the release
of the Pepper Commission report i n the Spring of 1990, a number
of major universal health insurance l e g i s l a t i v e proposals have
been introduced
in the Congress. Senator Jay Rockefeller (D.-
W.Va.) and Congressman Henry Waxman (D.-Cal.) have introduced
l e g i s l a t i o n along the l i n e s of the Pepper Commission
recommendations.
This includes requiring that a l l large
employers (more than 100 employees) cover employees and
dependents under a private health insurance plan or contribute to
t h e i r coverage under a public program (Pepper, 1990).
Small
firms would be given strong incentives to provide coverage under
private health insurance or a public plan.
Remaining uninsured
individuals would be covered under a public plan by paying a
premium (zero for those below poverty, and subsidized between 100
and 200 percent of poverty).
C r i t i c s of the Pepper Commission have suggested
alternatives.
Congressman Pete Stark (D.-Cal) has proposed
l e g i s l a t i o n that would cover a l l Americans under the Medicare
program.
Congressman Marty Russo ( D . - I l l ) and Congressman Tom
Downey (D.-N.Y.) have proposed l e g i s l a t i o n that would enact a
83
�comprehensive health insurance plan modelled on the Canadian
system.
Senator Robert Kerrey
(D.-Neb.) has introduced a
comprehensive single plan that would be administered by state
governments.
Mixed public-private universal health insurance plans that
are closer i n concept to the Pepper Commission recommendations
include that introduced by Senator George Mitchell (D.-Me) and
other Democratic Senators.
This plan would cover a l l Americans
under a combination of employer-provided private health insurance
or a federal-state public program.
Congressman Dan Rostenkowski
( D . - I l l . ) has a plan which would cover a l l Americans under either
a public program similar to Medicare or employer-provided private
health insurance.
His plan would establish prospective targets
for spending under the plan linked to growth i n the gross
national product.
The taxes to finance expanded coverage are unpopular with
many people.
Another alternative i s to reform the provision of
private health insurance without expanding public coverage.
This
approach i s supported by the Health Insurance Association of
America (HIAA), and i s reflected i n a b i l l introduced by
Congressman Rod Chandler (R.-Wash.) and Congresswoman Nancy
Johnston (R.-Conn.).
This plan includes reform of the sale of
private health insurance with federal regulation of underwriting
practices.
small firms.
Insurers would be required to offer coverage to a l l
No individual could be excluded for health reasons.
Limits would be set on exclusions for pre-existing conditions.
84
�Bounds would be set on the extent to which premiums could vary
with the r i s k of the group.
In addition, HIAA supports expansion
of Medicaid to cover a l l poor persons.
While reform of the sale of private health insurance has
merit, few believe that simply eliminating the worst abuses of
underwriting i n the small group market for health insurance w i l l
truly make health insurance affordable and available to a l l those
in need of coverage.
Robert Reischauer, Director, Congressional
Budget Office, has estimated that i t might actually reduce
coverage rather than increase i t (Reischauer, 1991).
Given the lengthy and ongoing public debate that i s l i k e l y
to be required to achieve resolution on comprehensive reform, an
incremental approach that would build on current programs offers
at l e a s t the hope of some near-term r e l i e f i n assuring access to
needed care for those i n dire need of assistance.
Without some
assistance, many hospitals and other health care providers
serving persons with HIV disease are l i k e l y to experience severe
financial pressures.
The policy options set forth i n t h i s paper
provide a wide array of alternatives for f i l l i n g the gaps i n
current sources of financing health care for persons with HIV
disease.
Each has advantages and disadvantages, but a l l offer
some form of assistance dealing with a badly neglected problem.
B.
Medicaid
Expansion
The options to expand Medicaid have a r e l a t i v e l y modest
budgetary impact and would provide some additional assistance to
poor persons with HIV disease.
They build on the l e g i s l a t i v e
85
�changes enacted by Congress from 1984 to 1990 to expand Medicaid
to additional groups of needy individuals.
The benefits are
reasonably comprehensive, including coverage for many drugs
needed i n the treatment of HIV disease.
Their primary disadvantages include: the f i s c a l pressures on
states that lead governors and other state o f f i c i a l s to oppose
additional federal mandated e l i g i b i l i t y groups; t h e i r exclusion
of the majority of uninsured persons with HIV disease; and the
low provider payment rates that lead to low participation in the
program.
C.
Medicare Expansion
The Medicare options focus on a population with a c l i n i c a l
diagnosis of AIDS, rather than the f u l l HIV disease population.
They require considerable patient cost-sharing, but also protect
low income individuals with Medicaid supplemental coverage.
The
higher provider reimbursement rates under Medicare may act as an
incentive to providers to provide care to individuals with HIV
disease.
I t should also be noted, however, that the Medicare benefit
package i s not ideally suited for the care of persons with HIV
disease.
I t excludes prescription drugs, and covers only very
limited long-term care benefits - hence, cost-sharing may prove
prohibitively expensive to those without Medicaid
supplemental
coverage.
Additionally, these options may come under opposition from
those who wish to protect Medicare funding for the elderly and
86
�also by those who would prefer options extending care to a l l
chronically i l l individuals and not just those with HIV disease.
D.
Private Health Insurance Reform
Reform of the market for private health insurance should
eliminate some of the underwriting practices that make health
insurance d i f f i c u l t for persons with HIV disease to obtain, but
would make health insurance more expensive.
I t could be
accomplished without any cost to the federal budget.
However,
even with such reforms many individuals and small firms are
unlikely to find private health insurance affordable.
This
option, therefore, would leave many uninsured persons with HIV
disease without coverage, and could lead to small firms dropping
coverage for a l l employees.
E.
Increase in Provider Funding
Expansion of funding for major providers serving persons
with HIV disease i s another approach. This could be accomplished
through expanded funding of the Ryan White Act.
I t s benefits
would be immediately available and provide f i s c a l r e l i e f to
overburdened public and teaching hospitals now caring for a
majority of the HIV disease population.
I t s primary disadvantage
i s that funding would only be available i n some geographic
locations, funding would not necessarily be adequate to meet a l l
the care needs of the target population,
and i t s t i l l would
require persons to seek "charity" care.
Early intervention and
treatment i s p a r t i c u l a r l y l i k e l y to suffer.
87
�F.
Drugs and HIV Vaccine
The consolidated purchase of drugs f o r HIV d i s e a s e treatment
would s i g n i f i c a n t l y reduce the c o s t of HIV drugs and improve
access t o e a r l y i n t e r v e n t i o n treatments f o r the uninsured and the
underinsured.
T h i s i s a r e l a t i v e l y inexpensive and immediate
measure, which would b e n e f i t many s u f f e r i n g i n the e a r l y stages
of HIV d i s e a s e and provide for t h e i r need of drug treatments t o
slow the progression of the d i s e a s e .
Reform of the Orphan Drug Act to make widely used drugs
a v a i l a b l e t o persons with HIV d i s e a s e a t a more competitive p r i c e
i s an a t t r a c t i v e option.
I t s primary disadvantage i s the
d e t e r r e n t e f f e c t i t might have on the r e s e a r c h and development
e f f o r t s of pharmaceutical companies.
G.
Conclusion
There can be no question t h a t a comprehensive approach to
a s s u r i n g u n i v e r s a l h e a l t h insurance coverage would deal the most
e f f e c t i v e l y with the need f o r f i n a n c i a l a c c e s s t o h e a l t h c a r e
s e r v i c e s f o r persons with HIV d i s e a s e .
The primary
of such an approach i s i t s f e d e r a l budgetary
disadvantage
c o s t , and depending
on the s p e c i f i c approach i t s c o s t to small b u s i n e s s .
P o l i t i c a l l y , however, t h i s recommendation seems f u r t h e s t from
immediate implementation.
Action must t h e r e f o r e be taken t o
begin implementing an incremental approach, which would provide
for the immediate needs of those s u f f e r i n g from HIV d i s e a s e .
S e r i o u s c o n s i d e r a t i o n should a l s o be given to expanding t h e
options of t h i s report to a g r e a t e r population, not j u s t
88
those
�with HIV disease, who are also chronically i l l and facing
financial hardship from medical
expenses.
89
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100
�TABLE 1
PROJECTED NUMBERS* OF ACQUIRED IMMUNODEFICIENCY SYNDROME (AIDS) CASES,
DEATHS AND LIVING PERSONS WITH AIDS, UNITED STATES,
JANUARY 1989-DECEMBER 1993
Year
1989
1990
1991
1992
1993
44,000-50,000
52,000-57,000
56,000-71,000
58,000-85,000
61,000-98,000
AIDS cases
Alive
New cases+
Cumulative t o t a l
t h r o u g h 1993
11
92,000-98,000
111,000 -122,000
127,000-153,000
139,000-188,000
151,000-225,000
390,000-480,000
-
Deaths
31,000-34,000
37,000-42,000
43,000-52,000
49,000-64,000
53,000-76,000
285,000-340,000
• P r o j e c t i o n s a r e a d j u s t e d f o r u n r e p o r t e d diagnoses o f AIDS by adding
18% t o p r o j e c t i o n s o b t a i n e d from r e p o r t e d cases ( c o r r e s p o n d i n g t o 85%
o f a l l diagnosed cases b e i n g r e p o r t e d : 1/0.85 = 1.18) and rounded
t o t h e n e a r e s t 1,000.
b e r o f cases diagnosed i n t h a t year.
^This number d i f f e r s from t h e number *101,000) p u b l i s h e d i n t h e M W
MR
(1990;39:110-2,117-9) because o f a t r a n s c r i p t i o n e r r o r .
^'Rounded t o t h e n e a r e s t 5,000. I n c l u d e s an e s t i m a t e d 12 0,000 AIDS
cases diagnosed t h r o u g h 1988, 48,000 persons a l i v e w i t h AIDS a t
t h e end o f 1988, and 72,000 deaths among p a t i e n t s diagnosed as h a v i n g
AIDS t h r o u g h 1988.
Source: U.S. Department o f H e a l t h and Human S e r v i c e s , P u b l i c H e a l t h
S e r v i c e , Centers f o r Disease C o n t r o l , 1990. "HIV Prevalence
E s t i m a t e s and AIDS Case P r o j e c t i o n s f o r t h e U n i t e d S t a t e s :
Report
Based upon a Workshop," M o r b i d i t y and M o r t a l i t y Weekly Report,
November 30; 39(RR-16):1-31.
101
�TABLE 2
AIDS CASES, CASE-FATALITY RATES, A D DEATHS B HALF-YEAR A D AGE G O P
N
V
N
RU,
T R U H OCTOBER 1990, UNITED STATES
HOG
Half-year of
diagnosis
Adults/Adolescents
Cases diagnosed Case-fatality Deaths occurring
during interval
rate
during interval
Children<13 years old
Cases diagnosed Case-fatality Deaths occurring
during interval
rate
during interval
78
82.1
30
66.7
1981 Jan-June
July-Dec
92
199
93.5
91.0
38
85
62.5
100.0
1982 Jan-June
July-Dec
394
685
90.6
88.6
152
282
U
15
78.6
80.0
1983 Jan-June
July-Dec
1,261
1.631
92.1
91.4
515
917
32
42
93.8
78.6
13
16
1984 Jan-June
July-Dec
2,543
3,334
89.0
89.8
1,374
1,917
49
62
83.7
72.6
25
24
1985 Jan-June
July-Dec
4,815
6,187
88.7
87.0
2,741
3,730
94
126
73.4
74.6
44
68
1986 Jan-June
July-Dec
8,119
9,760
85.2
82.3
4,900
6,231
132
177
72.0
67.2
64
84
1987 Jan-June
July-Dec
12,544
13.947
81.4
74.5
7,245
7,611
219
245
61.6
58.4
112
157
1988 Jan-June
July-Dec
15.719
16,003
66.9
59.9
8,815
9,999
238
314
49.2
44.9
129
150
1989 Jan-Jine
July-Dec
17,523
16,839
49.0
39.4
11,146
12,280
309
283
41.7
36.7
155
158
1990 Jan-June
July-Oct
15.558
5.000
25.6
13.1
10,637
3,565
242
73
21.5
19.2
128
47
152.231
62.0
94,375
2,686
52.0
1,399
Before 1981
Total*
•Death totals include 165 adults/adolescents and 2 children known to have died, but whose dates of death are unknown.
Source: U.S. Department of Health and Hunan Services, Public Health Service, Centers for Disease Control.
"Surveillance Report," Morbidity and Mortality Weekly Report, November 1990.
102
�TABLE 3
PROJECTED N M E S O ACQUIRED IMMUNODEFICIENCY S N R M (AIDS) CASES,
UBR F
YDOE
BY RISK-BEHAVIOR G O P , UNITED STATES, 1989-1993
RU*
Homosexual/bisexual men
Year
Not intravenous
drug users
1990
1990
1991
1992
1993
26,000-28,000
29,000-31,000
30,000-38,000
30,000-44,000
30,000-48,000
2,600-2,800
2,700-3,000
2,600-3,400
2,500-3,600
2,400-3,800
219,000-262,000
21,000-25,000
Cumulative
total through
1993+
Intravenous
drug users
Heterosexual
male and female
Heterosexual
transmission
Intravenous
drug users
11,000
13,000-14,000
14,000-18,000
16,000-23,000
17,000-27,000
2,600-2,900
3,700-4,000
4,800-6,100
6,100-8,800
7,600-12,200
Perinatal
transmission
TOTAL
1,000-1,100
1,300-1,500
1,600-2,200
2,100-3,100
2,600-4,100
43,200-45,800
49,700-53,500
53,000-67,700
56,700-82,500
59,600-95,100
95,000-118,000 29,000-38.000 11,000-14,000 262,200-344,600
:
*Prr>»ctions are adjusted for unreported diagnoses of AIDS by adding 18X to projections obtained from
d cases (corresponding to 85X of a l l diagnosed cases being reported: 1/0.85 = 1.18) and rounded
v
. nearest 1,000 for the f i r s t and third groups, and to the nearest 100 for the other three groups).
+Rounded to the nearest 1,000. Includes the following number of cases estimated to have been diagnosed
through 1988: 74,000 among homosexual and bisexual m m who are not intravenous drug users (IVDUs); 8,600
e
among homosexual and bisexual men who are IVDUs; 25,000 among heterosexual male and female IVDUs; 4,200
attributed to heterosexual transmission, and 1,900 attributed to perinatal transmission.
Source: U.S. Department of Health and Hunan Services, Public Health Service, Centers for Disease
Control, 1990. "HIV Prevalence Estimates and AIDS Case Projections for the United States:
Report Based upon a Workshop," Morbidity and Mortality Weekly Report. November 30; 39(RR-16):1-31.
103
�TABLE 4
Vaccine Costs i n 1991 D o l l a r s
Vaccine
DPT
OPV
MMR
HIB
TOTAL
Source:
CDC c o s t ($)
6.91
2.00
15.33
5.16
40.31
Private costs($)
10.95
9.45
22.29
14.50
86.44
Horn, 1991.
104
�APPENDIX 1
Assumptions and Data Sources for
Cost Estimates of Options
Rose Chu, M.B.A.
Actuarial Research Corporation
6928 L i t t l e River Turnpike, Suite E
Annandale, Virginia 22003
105
�APPI1
8/21/91
APPENDIX I
Assunptions and Data Sources for
Oost Estiinates of Options
Option 2: Mandate Medicaid coverage for all persons with HIV infection or
AIDS with inocmes below the federal poverty level meeting the SSI asset
test. Allow those with inocmes between 100% and 200% of the poverty level
to purchase Medicaid on a sliding premium basis
A. Number of persons affected
1. HIV population with inccmes belcw poverty
Ihe CDC estimated that in July 1991, there would be approximately
1,160,000 persons with HIV infection (CDC 1990a). According to the 1989
Current Population Survey 19% of single males aged 25-44 had inccmes below
the federal poverty level (Census 1989). IVDUs accounted for 32% of
persons with AIDS (CDC 1990a). I f i t i s assumed that half of the IVDUs
have inccmes below the poverty level, and 19% of the other 68% of the HIV
population also have lew income, the weighted average i s 29% with lew
income.
Ihe number of new Medicaid eligibles should exclude those with
enployer sponsored insurance, already on Medicaid, who will continue to
purchase individual insurance, or who cannot pass the SSI assets test.
Only 7% of single males aged 25-44 with inccmes less than the poverty
level had enployer sponsored insurance and 17% of those without enployer
sponsored insurance were already on Medicaid (CPS 1989). A higher
percentage, 46% of w m n aged 19-44, were already on Medicaid (CPS 1987).
oe
Weighting these Medicaid rates by the male and female distributions of 90%
�and 10% fron the CDC gives an estimate of 249,656 who are potentially
eligible for Medicaid.
The CPS asks for annual income but there are many persons with income
below the poverty level part of the year. Thorpe and Siegel (1989)
estimated that an additional 26% would be poor part of the year. About
16% of those without enployer sponsored insurance or public insurance
purchased their own individual policies (CPS 1989). I t i s assumed that
half of the 16% will continue to purchase their cwn policies since private
insurance allows access to more providers. There i s little information
about the distribution of financial assets among young adults. I t i s
assumed that 90% of individuals with inocme belcw the poverty level would
pass the assets test. I t i s estimated that half the HIV population does
not knew they are HIV positive and only half of those who knew will apply
for Medicaid. A total of 25% of those eligible would be added to
Medicaid.
2. HIV population with inocmes between 100% and 200% of poverty
According to the 1990 CPS, 16% of single males aged 25-44 had incomes
between 100% and 200% of poverty, 67% of w o did not have enployer
hm
sponsored insurance. Only 25% would apply for Medicaid i f i t were free.
I t i s assumed that half of these persons would buy Medicaid for premiums
based on a sliding scale fran $0 to $1068 per person, averaging $500 per
person.
3. Persons with AIDS with inccmes below poverty
CDC estimated the number of persons alive with AIDS and those who
died during 1990 and 1991. The number of persons alive at the end of 1990
and 1991 i s estimated by subtracting those who died from those alive
1-2
�during the year. Ihe number of persons with AIDS alive in July 1991
(85,000) i s estimated as the average of the persons alive at the end of
1990 and the erri of 1991.
Of the 85,000 persons with AIDS in July 1991, i t i s estimated that
40% are already on Medicaid (HCFA 1990). Ihe 1991 average payment levels
for SSI and state supplementation payment are 77% of the poverty level,
counting those states with higher than 100% of poverty level as 100%
(Social Security Administration 1991). According to the 1989 CPS, 16% of
single males had income within 16% of the poverty level. Therefore, the
difference between the inocme limit and 100% of the poverty level can be
used to estimate the percentage of persons in that inocme band. SSI
allows $20 in monthly inocme not to be counted, so the average SSI/SSP
inccme limit i s 80% and 20% is the estimate of the percentage of persons
with inccmes between 80% and 100% of poverty. The 20% i s applied to those
persons already on Medicaid. I t i s assumed that a l l of the 20% can pass
an assets test.
Even i f a person with AIDS had assets above the $2000
level for countable resources, medical treatment and living expenses would
soon reduce his or her assets.
4. Persons with AIDS with inocmes between 100% and 200% of
poverty
According to the 1990 CPS, 16% of single males aged 25-44 had inccmes
between 100% and 200% of poverty. This 16% is multiplied by 1.25 for a
total of 20% because persons with AIDS are more likely to have quit work.
I t i s assumed that 80% of these persons with AIDS would buy Medicaid at an
average premium of $500 per person. Many of those buying Medicaid would
have been previously uninsured but persons purchasing in±Lvidual insurance
1-3
�or C B A may also buy Medicaid because the Medicaid premiums are lower and
OR
Medicaid has l i t t l e or no cost sharing.
B. Costs of medical treatment
1.
Costs of HIV treatment
The CDC estimated that 60% of the HIV population have CD4+ c e l l
levels below 500 (CDC 1990a).
This i s the grot?) that could benefit from
medical treatment, a t a cost of $5603 i n charges per person per year (Arno
1990 estimate of $5094).
Arno reccmmends that the other 40% be monitored
and counseled (at charges of $581 per person). Most of the charges (90%)
for persons with HIV infection are f o r pharmaceuticals which are assumed
to be paid at average wholesale prices by Medicaid, which are 80% of
charges (Hellinger 1990b).
On average Medicaid paid 64% of Medicare
prevailing charges f o r physician v i s i t s i n 1988 (PPRC Annual report 1991).
I t i s also assumed that Medicare fees are about 75% of charges.
Altogether, Medicaid would pay about 75% of charges f o r treatment and
counseling f o r HIV infection.
Medicaid oosts f o r medical treatment not
related t o HIV infection i s $1068 per person, based on FY 1989 Medicaid
expenditures f o r the AFDC-type adults not receiving cash assistance (HCFA
2082 data f o r FY 1989).
HCFA uses 51% as the Federal share f o r AIDS
treatment (HCFA 1990).
Federal shares range fron 50% t o 80% but the
matching share i s 50% i n many of the states with the largest HIV
populations.
2. Costs of AIDS
The most recent estimate of medical treatment f o r AIDS was $32,000 i n
charges per year i n 1990 (Hellinger 1991).
t h i s would be $35,200 i n 1991.
Projected a t 10% per year,
Medicaid i s assumed t o pay 58% of charges
1-4
�(HCFA 1990).
C. Equitable Treatment for all persons with incomes belcw the
poverty level
According to the March 1990 CPS, there were an estimated 16 million
uninsured and 5 million persons with non-grotp insurance with inccmes
below the federal poverty level. I f a l l poor persons without group
insurance were to be covered under Medicaid i t would cost at least $25
billion in 1991 (based on Medicaid costs of $1068 for single males). This
is a rough estimate because not all who are eligible would choose to
enroll and the costs may be higher or lower depending on their health
needs.
To enroll just the disabled persons with inccmes belcw poverty would
cost about $4.1 billion. There were 3.4 million disabled persons
receiving SSI payments in September 1990 (Social Security Bulletin March
1991), almost a l l of w c are enrolled in Medicaid. Another 680,000
hm
(estimated as 20% of 3.4 million) have inccme above SSI/SSP levels but
below the poverty level. I t i s assumed that these disabled persons have
$6000 in medical costs.
Option 3: Provide all states with the option of expanding Medicaid
coverage, with federally matched state funding, to a l l individuals with
HTV infection and AIDS with inocmes below the federal poverty level and
meeting the SSI asset test.
A. Number of Persons affected
1. HIV Population
I t i s assumed that New York and Califomia would choose the option to
1-5
�enroll persons with HTV infection and AIDS onto Medicaid.
These are the
two states with the largest MV and AIDS populations and they would be
able t o receive federal matching funds t o help f o r state-only programs.
State distributions of persons with HIV disease are taken fron CDC
(1991b). The Medicaid programs i n New York and Califomia are more
generous than average so the percentage e l i g i b l e f o r Medicaid reported i n
the CPS nationwide was increased by 20%.
Otherwise, the same assunptions
are used as under Option 2.
2. AIDS Peculation
Persons with AIDS are presumed disabled so i f t h e i r income i s lew
enough they can receive SSI and thus be e l i g i b l e f o r Medicaid. I n
Califomia, a l l of the persons with AIDS with inccmes below the poverty
level are already e l i g i b l e f o r Medicaid because of i t s generous state SSI
supplements.
According t o a hospital survey (Andrulis 1989), 54% of AIDS
inpatient admissions i n the Northeast were covered by Medicaid i n 1987.
This percentage i s used f o r New York.
i s 90% of the poverty level.
New York's state SSI income l i m i t
Raising the inocme l i m i t s f o r persons with
AIDS from 90% t o 100% of the poverty level would increase the New York
AIDS population covered Medicaid by 10%.
B. Medicaid Oosts
1.
Costs f o r persons with HIV infection
Medicaid enrollees would also have health expenses not related t o HIV
paid by Medicaid.
The FY 1989 HCFA 2082 reports c o l l e c t data from each
state on expenditures.
For FY 1989, New York spent $1817 per person on
AFDC-type adults not receiving cash assistance and C a l i f o m i a spent $1075.
These figures, i n f l a t e d t o 1991, were used t o estimate the non-HIV related
1-6
�costs per person. Ihe 1988 Medicaid fees as a percentage of Medicare fees
came from the 1991 Physician Payment Review Conmission Annual Report. On
average, New York and Califomia reimbursed 43% of Medicare prevailing
charges for physician visits in 1988 (about 64% nationwide).
Option 4: Mandate Medicaid to pay health insurance premiums and maintain
or restore insurance through the workplace for a minimum of 29 months, for
persons with HIV infection or AIDS who have left erployment with inccmes
belcw the federal poverty level.
A. Number of persons affected
1. Persons with HTV infection
Persons who have left employment in a firm with more than 20
enplcyees are eligible to purchase continuing health benefits. Ihe 1989
CPS estimates that 89% of single males were employed. According to the
1989 CPS only 55% of single males were employed by firms with more than 20
employees and also have health insurance through their employment. The
Yelin study (1991) estimates that about 10% of persons with HIV quit
working.
Medicaid would pay the C B A premiums for persons with incomes below
OR
poverty level. Persons who quit their jobs have reduced inccmes but are
likely to be eligible for SSDI payments. Workers may also be covered by
long term disability insurance. Ihe Bureau of Labor Statistics conducts a
survey of medium and large firms every two years which showed that in
1989, 45% of workers were covered by long term disability which pay on
average 50% to 60% of previous earnings (BLS 1990). In most cases, long
term disability insurance continues until normal retirement age.
1-7
�In the estiinates f o r C B A and Medicare coverage, these monthly
OR
insurance payments were used t o estimate the population with income less
than poverty levels.
According t o the 1989 Social Security B u l l e t i n
Annual Supplement, 33% of male SSDI beneficiaries received monthly SSDI
payments which were below the poverty level.
I f 45% of these workers
also receive d i s a b i l i t y insurance payments, then 18% would have combined
SSDI and private d i s a b i l i t y income less than poverty level.
I t i s assumed
that other inccme from wages, investments, etc. i s not significant f o r
t h i s group.
I t i s assumed that 90% of those with lew income can pass the
assets test.
2.
Persons with AIDS
Persons with AIDS were divided into those diagnosed with AIDS i n 1991
and those diagnosed earlier.
As for persons with HIV infection, 77% of
the persons with AIDS are estimated t o have been i n the labor force.
Yelin e t a l (1991) estimates that about 25% quit work by the middle of the
f i r s t year and 50% quit work after the f i r s t year. The 1989 CPS estimates
that 55% of working males would have been e l i g i b l e f o r COBRA. As
discussed i n the section on persons with HIV infection, 18% are assumed t o
have inccmes belcw poverty level.
B.
Costs
HIAA conducts an annual study of enployer sponsored health insurance
(Gabel e t a l 1990). Premiums f o r single persons f o r 1989 were $119 per
month. With a 12% annual i n f l a t i o n and adding 2% administrative fee,
premiums would be $1827 f o r 1991. The average deductible was $200 per
person and average maximum cost sharing was $1000. I f Medicaid pays the
C B A premiums and the cost sharing f o r lew inccme persons, t o t a l costs
OR
1-8
�would be $3027 per person, or a total of $24 million.
Sane of these persons would have been on Medicaid but new most of
their costs will be paid by their enployers' health plan instead of
Medicaid. Most of the low income population would be eligible for
Medicaid thraugh SSI or the state medically needy programs. I t i s
estimated that 80% of these low inocme persons would have been on
Medicaid.
C. Equitable treatment for all SSDI beneficiaries without Medicare
HCFA estimated that 805,000 SSDI beneficiaries are in the two year
Medicare waiting period (HCFA 1991). According to 1989 data on SSDI
beneficiaries, 45% receive SSDI payments which are less than the poverty
level. ELS estimates that 55% of medium and large firms do not have long
term disability insurance. Using these two figures gives an estimate that
25% of the SSDI population has income less than the poverty level. I t i s
assumed that 40% of the SSDI beneficiaries are eligible for COBRA.
Option 5: Permit Social Security Disability Insurance (SSDI)
beneficiaries to purchase Medicare during the two year waiting period
A. Number of persons affected
1. Persons with AIDS with inccmes belcw poverty level
Federal legislation requires state Medicaid programs to pay for
Medicare premiums, deductibles and coinsurance of aged and disabled
Medicare beneficiaries with lew income. By January 1, 1991 states had to
pay for cost sharing of Medicare beneficiaries with income less than
poverty level and assets less than twice the level allowed by SSI.
Ihe Social Security actuaries estimated that 30,099 persons with
1-9
�AIDS would be SSDI beneficiaries i n July 1991 (Social Security 1990).
HCFA estimates that 3100 of these persons are on Medicare i n 1991 (HCFA
Actuaries 1990).
Medicaid would save money (compared t o current law) under t h i s buy-in
program because i t i s estimated that 80% of those bought i n are already on
Medicaid because they could meet the income and assets l i m i t s .
Instead of
paying f o r a l l of the Medicaid services. Medicaid would pay f o r only drugs
which are not covered by Medicare and the Medicare cost sharing.
3.
Persons with inccmes above 100% of poverty level
Using 1989 CPS data, i t i s estimated that 49% of single males with
incomes above the poverty level would have been e l i g i b l e f o r C B A or
OR
bought t h e i r own insurance. Since the Medicare premiums are so expensive
and Medicare does not cover prescription drugs as most private plans do,
i t i s assumed that anyone with private insurance would not purchase
Medicare.
I t i s also assumed that half of those without private insurance
would purchase Medicare. But i t i s estimated that 60% of these persons
would have qualified for Medicaid after s i x months of medical expenses.
B.
Cost t o Medicaid and Medicare
This option would make Medicare secondary t o C B A and other enployer
OR
sponsored insurance so that enployers could not discontinue insurance
coverage t o SSDI beneficiaries.
Medicare Part A premiums f o r 1991 are
$177 per month f o r those who do not receive Part A without a premium.
Part B premiums which are $29.90 per month are multiplied by four because
beneficiaries only pay one-fourth of the costs.
Medicare deductibles are
$628 f o r inpatient hospital and $100 f o r Part B medical servioes.
sharing i s 20% of Part B services.
Cost
Total charges f o r AIDS treatment are
1-10
�$35,200, of which $4400 i s for prescription drugs not covered by Medicare
(Hellinger 1991). According to a hospital survey, inpatient hospital
costs were about 80% of charges (Andrulis 1989). Medicare i s assumed to
pay oosts, and therefore 80% of charges for inpatient hospital servioes.
Since inpatient hospital oosts are most of the costs for AIDS treatment,
80% of charges is used as the Medicare reimbursement. Total charges for
non-AIDS medical treatment are $1,473 (80% of $1068 (Medicaid
reimbursement) divided by 58% (percentage of charges that Medicaid pays)).
C. Equitable treatment for all SSDI beneficiaries
Data fron the SSDI were used to calculate the costs of extending
Medicare to a l l the SSDI at a premium of $3559 and other costsharing. An
estimated 25% of the 805,000 SSDI beneficiaries in the waiting period for
Medicare have inccmes belcw the poverty and 40% of them are eligible for
COBRA (See Option 4C). Premiums, deductibles ($100 for Part B and $628
for estimated 30% needing Part A), and coinsurance on Part B (about half
the expenses) total $4650 per person. For the 75% with hi^ier inccme, 1989
CPS data shews that 51% don't have private insurance. I t i s assumed that
half the persons without private insurance will purchase Medicare.
Option 6: Allcw all individuals with AIDS to purchase Medicare. For
individuals with inocmes belcw the federal poverty Medicaid would pay for
the premiums, deductibles and coinsurance.
A. AIDS population
Medicaid would buy in the 40% of the AIDS population who are on
Medicaid plus 20%. This i s the group with incomes less than the poverty
l-ll
�level.
The Yelin study (1991) showed that 25% of persons diagnosed with AIDS
quit working during the first year and 50% during the second year. Firms
with 20 or more enplcyees are required to offer O B A continuation
OR
insurance. Ihe percentage of enplcyees working in the larger firms with
O B A i s 55%.
OR
Using the Yelin data and the 1989 CPS data, i t i s
estimated that 51% of the AIDS population does not have private insurance.
I t i s assumed that half of those without private insurance will choose to
purchase Medicare.
Many of the persons with AIDS who purchase Medicare would have
incurred enough medical expenses to qualify for Medicaid.
I t i s assumed
that 60% of them would have been on Medicaid after six months.
B. Costs to Medicaid and Medicare
Ihe assunptions are the same as for Option 5.
Option 7: Eliminate the current two-year waiting period for SSDI
beneficiaries with AIDS to receive Medicare
A. Persons affected
As in Option 2, 18% of those SSDI beneficiaries with AIDS hut without
Medicare currently would be bought in by Medicaid.
The rest of the SSDI
beneficiaries would autcmatically be enrolled in Medicare for Part A and
oould receive Part B servioes after paying the Part B premium. Since Part
B premiums are so inexpensive, i t i s assumed that everyone will enroll.
O B A and other employer-sponsored insurance would be required to offer
OR
insurance to supplement Medicare for cost-sharing and servioes such as
prescription drugs not covered by Medicare.
1-12
�B. Oosts to Medicaid and Medicare
Part B premiums for 1991 are $29.90 per month, or $359 per year.
Medicaid would pay for the premiums, deductibles, and coinsurance for the
low inocme SSDI beneficiaries. But i t i s estimated that 80% of the
persons bought in would have been on Medicaid.
1-13
�Pol icy Options
Estiinates of Population Affected and Medical Costs
)L1
:DS3
'/.
8'
Population
or Costs
Data Source and Assumption
Mandating Medicaid for all persons with HIV or AIDs uith incomes less than the poverty level
those with incomes 10DX to 200X of poverty can buy Medicaid (Assets test applies, HIV+ presuned disabled)
1160000
A. 1991 HIV population
M W Nov 30, 1990 C C estimate for 7/91
MR
D
b. Uomen HIV+
2. Already eligible for Medicaid
0.29
1989 Current Pop Survey (CPS)
Never Married Males 25-44 19%
32X IVDU and assune half are poor
0.90
C C estimate, M W Nov 30, 1990
D
MR
33640
a. Men HIV+
336400
302760
1. HIV population with incomes < poverty
0.10
C C estimate, M W Nov 30, 1990
D
MR
66943
a. Hen already on Medicaid
51469
0.17
1989 C S low income single males 25-44
P
b. W m n already on Medicaid
oe
15474
0.46
1987 C S low income women 19-44
P
Not on Medicaid
269457
a. Adding persons poor part of the year
339516
1.26
Thorpe and Siegel 1989
b. With employer-sponsored
3.
-23766
0.07
1989 C S low income single males 25-44
P
insurance (ESI)
1. minus 2.
c. Some continue to buy individual insurance
-27161
Half of .16
d. Some don't pass assets test
-33952
0.10
4.
Potentially eligible for Medicaid
254637
5.
Persons who seek treatment and apply for Medicaid
6. Medicaid costs for HIV treatment (SIOOO's)
7.
Medicaid costs for non-HIV treatmeant
8.
Total Medicaid costs ($1000 s)
,
1989 C S low income single males 25-44
P
63659
0.25
1/2 know HIV+, 1/2 of them treated
$175,317
$2,754
60X 3 $5603 for treatment
40X S $581 monitoring and counseling
75X of charges, mostly drugs
$67,988
$1,068
Based in H F F 1989 AFDC-type
CA Y
adults non-cash
$243,305
6. + 7.
�Pol icy Options
Estiinates of Population Affected and Medical Costs
P0L1
AIDS3
8/8/91
Population
or Costs
Data Source and Assurption
185600
0.16
1990 CPS never married males 25-44
124352
0.67
1990 CPS never married males 25-44
100X to 200X of poverty
2. Those who know they have HIV infection
31088
0.25
3. Those who buy Medicaid
15544
0.5
4. Medicaid costs for HIV treatment ($1000's)
$42,808
$2,754
5. Medicaid costs for non-HIV treatment
$16,601
$1,068
$7,772
$500
II B. HIV population lOOX to 200X of poverty
1. Those without employer-sponsored insurance
6. Premiums paid by those buying in
7. Net costs to Medicaid
$51,637
See A.6
3. + 4. - 5.
C. AIDS population with incomes < poverty
1991 AIDS population
85000
1. Already on Medicaid
34000
0.40
H F Medicaid Actuaries
CA
6800
0.20
Raising average income limits from 80%
to 100% of poverty
$138,829
$20,416
$7,262
$1,068
$43,827
0.60
2.
New on Medicaid
3. Medicaid costs for AIDS treatment (SIOOO's)
4. Medicaid costs for non-AIDS treatment
5. Would have been paid by Medicaid
6. Costs to Medicaid (SIOOO's)
Estimated from M W Nov 1990 for 7/91
MR
58% of $35,200 (HCFA 1990,HelIinger 1991)
Based on FY 1989 Medicaid costs
60% would have qualified for Medicaid
after six months
$102,264
D. AIDS population 100X to 200% of poverty
1991 AIDS population
85000
1.
17000
0.20
13600
0.80
$277,658
$20,416
$14,525
$1,068
5. Premiums paid by those buying in
$6,800
$500
6. Would have been paid by Medicaid
$85,615
0.60
Incomes between 100X to 200X of poverty
Without employer-sponsored insurance
2. Those who buy Medicaid
3. Medicaid costs for AIDS treatment (SIOOO's)
4. Medicaid costs for non-AIDS treatment
7. Net Costs to Medicaid
$213,368
58% of $35,200 (HCFA 1990,HelIinger 1991)
Based on FY 1989 Medicaid costs
Would have qualified for Medicaid
after six months
3. + 4. + 5. - 6.
�Reccmended Policy Options
Estiinates of Population. Affected and Medical Costs
3T
IDS'
/2'
Population
or Costs
Data Source and Assumptions
11. States have option to extend Medicaid for all persons with HIV or AIDs with incomes less than the poverty level
meeting the SSI assets test
A. 1991 HIV population in California and N w York
e
481400
M U Nov 30, 1990 C C estimate for 7/91
MR
D
and C C state distribution of AIDS cases
D
b. Uomen HIV+
2. Already eligible for Medicaid
0.29
1989 Current Pop Survey (CPS)
Never Married Males 25-44 1 5
9!
32X IVDU and assume half are poor
125645
0.90
C C estimate, M U Nov 30, 1990
D
MR
13961
0.10
C C estimate, M U Nov 30, 1990
D
MR
0.20
1989 C S low income single males 25-44
P
Add 20X
7679
a. Men HIV+
139606
25129
1. Low income HIV population
0.55
1987 C S low income women 19-44
P
Add 20X
32808
a. Men already on Medicaid
b. Uomen already on Medicaid
106798
5.
1. minus 2.
Not on Medicaid
a. Adding persons poor part of the year
1.26
Thorpe and Siegel 1989
-9420
0.07
1989 C S low income single males 19-44
P
-10765
Half of .16
1989 C S low income single males 19-44
P
-13457
b. Subtracting those with employer-sponsored
134565
0.10
insurance
c. Some continue to buy individual insurance
d. Some don't pass assets test
100923
e.
Eligible for Medicaid under this option
25231
4.
0.25
1/2 know HIV+, 1/2 of them treated
Persons who seek treatment and apply for Medicaid
$65,298
$2,588
60X 3 $5603 for treatment
40X a $581 monitoring and counseling
72X of charges, mostly drugs
$44,154
$1,750
Based on F 1989 Medicaid costs NY, C
Y
A
non-cash A D adults
FC
5. Medicaid costs for HIV treatment (SIOOO's)
6. Medicaid costs for non-HIV treatment (SIOOO's)
7.
Total Medicaid costs (SIOOO's)
$109,452
�Recomnended Policy Options
Estimates of Population Affected and Medical Costs
EST
AIDS2
7/21/91
Population
or Costs
B. 1991 AIDs population in N w York
e
Data Source and Assumptions
M W Nov 30, 1990 C C estimate for 7/91
MR
D
and C C state distribution of AIDS cases
D
18615
10052
0.54
Andrulis 1989 for the Northeast
1005
0.10
Raising income limits in N from 90%
Y
to 100% of poverty
3. Charges for AIDS treatment (SIOOO's)
$35,376
$35,200
4. Medicaid costs of non-AIDS treatment
$2,209
$2,198
1. Already on Medicaid
2. N w on Medicaid
e
5. Costs to Medicaid (SIOOO's)
Based on Hellinger 1990
Based on F 1989 N Medicaid
Y
Y
Estimate of N Medicaid payment
Y
80% of charges, mostly inpatient
$30,510
IV. Medicaid pays C B A premiuns for persons with incomes less than poverty level
OR
(Assets test applies, HIV+ presuned disabled, C B A can be reinstated i f lapsed)
OR
M U Nov 30, 1990 estimate for July 1991
MR
A. 1991 HIV population
1160000
1. Employed with HIV
893200
0.77
1989 C S single males 25-44, .89
P
32% IVDU and assune half employed
2. Employed in firms 20+ and with group insurance
491260
0.55
1989 C S single males 25-44
P
49126
0.10
Estimate from Yelin's graph
4. Those in 3. with incomes below poverty
8843
0.18
1989 Social Security Annual Supplement
1988 males SSDI payments <poverty, 33%
Bureau of Labor Stat 1990, 55% of
employees don't have long term disability
5. Those who pass assets test for Medicaid
7959
0.90
3. Those in 2. who will quit working with C B A
OR
6. Medicaid pays for C B A
OR
a. C B A premiuns ($1000's)
OR
b. Deductibles and coinsurance
$24,092
$14,541
$1,827
$9,551
$1,200
1989 HIAA Survey projected to 1991
at 102% of premium for f i r s t 18 months
�Recomnended Policy Options
Estiinates of Population Affected and Medical Costs
;
T
DS?
'1
2
Population
or Costs
B. 1991 AIDS population
1. Persons diagnosed in 1991 with AIDS
Data Source and Assunptions
85000
M W N v 30, 1990
MR o
63500
48895
0.77
1989 CPS single males 25-44, 89%
33X IVDU and assume S X employed
O
12224
0.25
Estimate from Yelin's graph
Potential COBRA, those w o quit work
h
for firm 20+ with ESI
6723
0.55
1989 CPS single males 25-44
d. Of those in c, with incomes below poverty
1210
0.18
1989 Social Security Annual Supplement
1988 males SSDI payments <poverty, 33X
Bureau of Labor Stat 1990, 55X of
employees don't have long term disability
a.
In labor force during 1991
b. Quit work in first year after diagnosis
c.
Medicaid pays for C B A
OR
$3,663
1. C B A premiuns (SIOOO's)
OR
$2,211
$1,827
2. Deductibles and coinsurance
e.
$1,452
$1,200
1989 HIAA Survey, 102X
AIDs population diagnosed before 1991
21500
a.
16555
0.77
1989 CPS single males 19-44, 89X
33X IVDU and assune half employed
b. Quit working after first year after diag
8278
0.50
Estimate from Yelin's graph
c.
Potential COBRA, those w o quit work
h
for firm 20+ with ESI
4553
0.55
1989 CPS single males 25-44
d. Of those in c, with incomes below poverty
820
0.18
1989 Social Security Annual Supplement
1988 males SSDI payments <poverty, 33X
Bureau of Labor Stat 1990, 55X of
employees don't have long term disability
e.
In labor force before diagnosis
M W N v 30, 1990
MR o
Medicaid pays for C B A
OR
$2,833
1. C B A Premiuns (SIOOO's)
OR
$1,849
$2,255
$984
$1,200
2. Deductibles and coinsurance
1989 HIAA Survey projected to 1991
at 102X of premiun for first 18 months
at 150X for 19th thru 29th month
3. Savings to Medicaid
a.
Would have been on Medicaid
1624
b. Costs of services n w paid by C B A (SIOOO's)
o
OR
$34,890
c.
$28,394
Savings to Medicaid (SIOOO's)
0.80
$21,484
SOX of those who are poor
$1068 + 58X of $35,200
3b. minus 2e. minus le.
�Policy Options
Estimates of Population Affected and Medical Costs
P0L1
AIDS3
8/8/91
Population
or Costs
Data Source and Assumption
V. SSDI beneficiaries able to purchase Medicare during 2 year waiting period
Medicaid pays costsharing for those with incomes below poverty level
( O R and ESI is primary to Medicare)
CBA
A. SSDI beneficiaries with AIDS
1.
Some already on Medicare
30099
Feb 1990 estimate from Social Security
for July 1991
3100
H F Medicare Actuaries 1990
CA
B. Medicaid pays for low-income SSDI
1.
Those with income below poverty
2. Medicaid buys SSDI beneficiaries into Medicare
4860
0.18
1989 Social Security Annual Supplement
1988 males SSDI payments <poverty, 33X
Bureau of Labor Stat 1990, 55X of
employees don't have Long term disability
$25,112
$17,297
$3,559
1991 Premiuns for Part A and Part B
$7,815
$1,608
$728 deductibles, 20% coinsurance
3888
0.80
b. Costs of services now paid by Medicare ($1000
$73,608
$18,932
c. Savings to Medicaid (SIOOO's)
$48,496
a. Medicare Premiuns (SIOOO's)
b. Medicare deductibles and coinsurance (SIOOO's
3. Savings to Medicaid
a. Already on Medicaid
A. Costs to Medicare
a. Costs for AIDS treatment (SIOOO's)
b. Costs for non-AIDS treatment (SIOOO's)
c. Premiuns, deductibles, coinsurance (SIOOO's)
$1068 + 58X of $30,800
3.b - 2
$101,797
$119,750
$24,640
$7,159
$1,473
80% of $30,800
80% of $1068/.58 (Medicaid costs)
($25,112)
C Those purchasing Medicare on their own
.
1.
Not on Medicare or bought in by Medicaid
22139
2. Those eligible for C B A
OR
or purchasing their own insurance
10848
3. Potential New SSDI on Medicare
11291
0.49
1989 C S single males 25-44, non-poor
P
Since Medicare premium is so high,
assune no one with private ins will buy
1. minus 2.
�Policy Options
Estimates of Population Affected and Medical Costs
.1
3/9
Population
or Costs
4. Those purchasing Medicare
a. Premiums paid by beneficiaries (SIOOO's)
b. Deductibles and Coinsurance paid by
beneficiaries (SIOOO's)
Data Source and Assumption
Half will purchase Medicare
5646
0.50
$20,094
$3,559
1991 Premiuns for Part A and Part B
$9,079
$1,60B
$728 deductibles, 20X coinsurance
3388
0.60
$30,262
$8,932
5. Savings to Medicaid
a. Would have been on Medicaid
b. Costs of services now paid by Medicare
Savings to Medicaid (SIOOO's)
6. Costs to Medicare (SIOOO's)
a. Costs of AIDS treatment (SIOOO's)
b. Costs of non-HIV treatment (SIOOO's)
c. Premiuns, deductibles, coinsurance ($1000's)
D.
Total Savings to Medicaid
E. Total Costs to Medicare
Would have qualified as medically needy
after six months
Six months of 58% of $30,800
$118,261
$139,117
$24,640
$8,317
$1,473
SOX of $30,800
SOX of $1068/.58 (Medicaid costs)
($29,173)
$78,758
$220,058
B.3c + C.5.b
B.4 • C.6
�Recomnended Policy Options
Estimates of Population Affected and Medical Costs
ESTI
AIDS3
8/8/91
Population
or Costs
VI.
Data Source and Assumptions
Allow a l l persons with AIDS to purchase Medicare Part A and B
Medicaid buys in persons with incomes less than the poverty level
A. 1991 AIDs population with incomes below poverty
M U Nov 30, 1990
MR
Bought in by Medicaid
40800
a. Already on Medicaid
34000
0.40
H F Medicaid Actuaries
CA
40X of 85,000
6800
0.20
Raising average income limits
from BOX of poverty to 100X
$75,128
$1,841
$1,256,640
$30,800
Hellinger 1991, without drugs
$210,814
$5,167
Premiums of $3559, coinsurance
Deductibles of $728
$643,688
$18,932
$854,600
1.
$20,946
b. Not on Medicaid but with incomes < poverty
2. Charges for non-AIDS medical (SIOOO's)
3. Charges for AIDS treatment
A. Medicaid savings
$432,874
a. Cost of purchasing Medicare
b. Cost of Medicaid eligibles now paid by
Medicare
Based on FY 1989 Medicaid ($1068/.58)
58X of 2. and 3. for those in l.a
(SOX of 2 + 3) - 4a
5. Medicare costs
B. 1991 AIDs population with incomes above poverty
1.
1991 AIDS population with incomes > poverty
44200
a. Those without employer-sponsored insurance
22542
0.51
11271
0.50
$20,754
$1,841
$347,147
$30,800
Hellinger 1991, without drugs
$58,237
$5,167
Premiuns of $3559, coinsurance
Deductibles of $728
$236,084
$20,946
6763
0.60
$64,019
$9,466
1989 CPS single males, non-poor
or other insurance
b. Those who w i l l purchase Medicare
Based on FY 1989 Medicaid ($1068/.58)
2. Charges for non-AIDS treatment (SIOOO's)
3. Charges for AIDS treatment
4. Costs to beneficiaries
5. Medicare costs
6. Uould have been on Medicaid
7. Cost of services now paid by Medicare
Savings to Medicaid
(SOX of 2 + 3) - 4
60X of B.lb after six months
Six months of (1068 + 58X of $30,800)
�Recommended Policy Options
Estimates of Population.Affected and Medical Costs
ESTI
AID""
8/1
Population
or Costs
D Total Savings to Medicaid
.
E. Net Costs to Medicare
VII.
Data Source and Assunptions
$496,893
A.4 + B.7
$1,090,684
A.5 + B.5
Eliminate 24 month waiting period for SSDI beneficiaries to get Medicare
( O R or ESI becomes secondary payer to Medicare)
CBA
A. SSDI beneficiaries with AIDS
1.
Some already on Medicare
30099
Feb 1990 estimate from Social Security
for 1991
3100
H F Medicare Actuaries, Feb 1990
CA
B. Medicaid pays for low-income SSDI
1.
Low income SSDI beneficiaries
2. Medicaid buys SSDI beneficiaries into Medicare
4860
0.18
Social Security
1988 males SSDI
Bureau of Labor
employees don't
1989 Bulletin, Annual Sup
payments <poverty, 33X
Stat 1990, 55X of
have long term disability
1991 Premiun for Part B
$11,129
a. Medicare Premiuns (SIOOO's)
$1,745
$359
b. Deductibles and Coinsurance (SIOOO's)
$9,385
$1,931
3888
0.8
b. Costs for services now paid by Medicare
$73,608
$18,932
c. Savings to Medicaid
$62,478
4. Medicare Costs (SIOOO's)
$115,780
$728 deductibles, 20X coin
3. Savings to Medicaid
a. Poor already on Medicaid
a. Costs of AIDS treatment (SIOOO's)
b. Costs of non-AIDS treatment (SIOOO's)
c. Premiums, deductibles, coinsurance (SIOOO's)
$1068 + 58X of $30800
3.b - 2.
$119,750
$24,640
$7,159
$1,473
80* of $30800
S X of $1068/.58 (Medicaid costs)
O
($11,129)
C Those purchasing Medicare on their own
.
1.
Not on Medicare or bought in by Medicaid
2. Premiuns paid by beneficiaries (SIOOO's)
or employers
22139
$7,943
$359
1991 Premiuns for Part B
�10
Recommended Policy Options
Estimates of Population Affected and Medical Costs
ESTI
AIDS3
8/8/91
Population
or Costs
3. Medicare deductibles and coinsurance paid by
beneficiaries or employers (SIOOO's)
$35,600
Data Source and Assunptions
$1,608
$728 deductibles 20X coinsurance
4. Savings to Medicaid
a. Uould have been on Medicaid
b. Costs of services now paid by Medicare
Savings to Medicaid (SIOOO's)
5. Costs to Medicare (SIOOO's)
a. Costs for AIDS treatment (SIOOO's)
b. Costs for non-AIDS treatment (SIOOO's)
c. Premiums, deductibles, coinsurance ($1000's)
6775
$64,132
49% have insurance
Of the rest, 60% would have qualified for
Medicaid after six months
$9,466
Six months of (1068 + 58% of $30800)
$542,516
$545,505
$24,640
$32,611
$1,473
80% of ($75,000-drugs)
80% of $1068/.58 (Medicaid costs)
($35,600)
D. Total Savings to Medicaid
$126,610
B.3c + C.4b
E. Total Costs to Medicare ($1000's)
$658,296
E.3. and D.5
�Clinton Presidential Records
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This is not a presidential record. This is used as an administrative
marker by the William J. Clinton Presidential Library Staff.
This marker identifies the place of a tabbed divider. Given our
digitization capabilities, we are sometimes unable to adequately
scan such dividers. The title from the original document is
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Divider Title:
�Tab
This S e c t i o n I n c l u d e s :
14.
The S o c i a l Impact o f AIDS i n t h e U n i t e d
S t a t e s N a t i o n a l Research C o u n c i l
�1
\\titi(\\L( YiXM'i
Introduction and Summary
An epidemic is both a medical and a social occurrence. Medically, it is
the appearance of a serious, often fatal, disease in numbers far greater than
normal. Socially, it is an event that disrupts the life of a community and
causes uncertainty, fear, blame, and flight. The etymology of the word
itself suggests the broader, social meaning: epi demos, in ancient Greek,
means "upon the people or the community."
The epidemic of acquired immune deficiency syndrome (AIDS)—which
was recognized in the United States in 1981, continues today, and will
continue into the foreseeable future—mirrors epidemics of the past. The
medical meaning of the epidemic has been revealed in the sobering numbers
reported in epidemiologic studies. During 1991, 45,506 new AIDS cases
were reported to the Centers for Disease Control (CDC), which brought the
cumulative total of cases in the United States to 206,392; 133,233 (65 percent) deaths have been tallied (Centers for Disease Control. 1992). It is
estimated that 1 million people are currently infected with the human immunodeficiency virus (HIV), which causes AIDS (Centers for Disease Control, 1990), but this number is very uncertain (see Technical Note at the end
of this chapter).
These numbers identify the first and most obvious impact of the HIV/
AIDS epidemic on American society: the large population of infected, sick,
and dying persons attacked by a previously unknown disease. Behind the
epidemiologic reports and the statistical estimates lies the social disruption
of the epidemic: the destroyed life for which each of the numbers stands
~1
�THE SOCIAL IMPACT OF AIDS IN THE U S
and the changed lives of many others touched by the disease. And behind
the individual lives are the manifold ways in which a variety of institutions
and practices have been affected by the epidemic.
In 1987 the National Research Council of the National Academy of
Sciences established the Committee on AIDS Research in the Social, Behavioral, and Statistical Sciences. Two of the committee's reports. AIDS:
Sexual Behavior and Intravenous Drug Use (Turner, Miller, and Moses,
1989) and AIDS: The Second Decade (Miller, Turner, and Moses, 1990),
reviewed and evaluated a wide range of social and behavioral science research relevant to HIV/AIDS prevention, education, and intervention. In
the course of preparing those reports, the committee noted that many of the
social consequences of the epidemic were not being studied in any systematic way. It judged that systematic study would be beneficial in predicting
the course of the epidemic's path through U.S. society and in formulating
policies to deal with it. Thus, in 1989 the committee established the Panel
on Monitoring the Social Impact of the AIDS Epidemic, with the general
mandate to study the social impact of the epidemic and to recommend how
it could be monitored in order to contribute to the formulation of policies
that might effectively deal with it. In the course of its work, the panel, with
the agreement of the parent committee and the several federal agencies that
were sponsoring its work, modified this mandate and deleted the plan to
recommend systems for monitoring.
This report is an unusual undertaking for the National Research Council. Its objective is to form a picture of the effects of the AIDS epidemic on
selected social and cultural institutions in the United States and to describe
how those institutions have responded to the impact of the epidemic. No
attempt has been made to write a comprehensive history—there are not yet
adequate studies of the epidemic upon which to base such an effort. Instead
we have been selective in looking at those institutions for which sufficient
information is available to describe impact and response. These descriptions cannot be considered complete and authoritative; but we do believe
they suggest a pattern that should be of concern to the country and command the attention of policy makers attempting to deal with the epidemic
over the next decade.
EPIDEMICS, IMPACTS, AND RESPONSES
The impact of AIDS has many dimensions, only a few of which are
captured in official statistics or analysis by the research community. The
numbers of AIDS cases and HIV infection count as an impact: cumulatively, they state the effect on the population of the United States and on
particular subpopulations. Each case has many dimensions—personal, professional, and institutional—through the many social organizations that touch
ISTRODUCTION AND SUMMARY
the life of each infected person
and the diverse impacts have g
viduals, groups, and communiti
The panel set out to study t
the problem of defining the te
word that in common parlance
sense, it indicates that one actii
by some other action or state c
and minor effects. Reaching de
a more powerful meaning—colli
effect that radically changes the
After much discussion, the
somewhere between these two
describes a concentrated force
adopted this hybrid meaning n'
the impact of AIDS on contemi
been destroyed—but because \
not merely destroy; it evokes ;
than physical. Persons and so
event; they remake their lives
preserve its effects. In this re)
process of impact and respons
AIDS epidemic.
The task of this panel w.
limited human vision, the impr
on individual lives and on so*
those that will endure in such .
take them into account in the n
one quite specific way: it can
onset of actual illness in a pati.
is not, like many historical epii
ity that rapidly sweeps throug
years, not only in the populatii
its presence will often be km
suffer the disabling, lethal effe
of the numbers of people wh
lethal effects years from now.
demic for many years into the
The institutions we studiec
and accommodated to it in a \
that is partial and apparently
fundamental change. Several
trajectory of limited initial n
�SOCIAL IMPACT OF AIDS IS THE U.S.
INTRODUCTION AND SUMMARY
:hed by the disease. And behind
in which a variety of institutions
idemic.
cil of the National Academy of
IDS Research in the Social, Be• the committee's reports. A/DS:
se (Turner, Miller, and Moses,
iller. Turner, and Moses. 1990),
ocial and behavioral science reeducation, and intervention. In
ammittee noted that many of the
lot being studied in any systemould be beneficial in predicting
U.S. society and in formulating
:ommittee established the Panel
DS^idemic, with the general
)id^^ftand to recommend how
: to^^formulation of policies
urse of its work, the panel, with
he several federal agencies that
andate and deleted the plan to
the life of each infected person. Each set of interactions creates an impact,
and the diverse impacts have generated equally diverse responses by individuals, groups, and communities.
The panel set out to study these impacts, and it immediately confronted
the problem of defining the terms of reference. "Impact" is an overused
word that in common parlance has become a synonym for "effect." In this
sense, it indicates that one action or state of affairs is caused or influenced
by some other action or state of affairs and is used to describe both major
and minor effects. Reaching deeper into the language, however, impact has
a more powerful meaning—collision. In this use of the word, an impact is an
effect that radically changes the previous state of affairs or even destroys it.
After much discussion, the panel adopted a definition of impact that fits
somewhere between these two meanings. "Impact" as used by the panel
describes a concentrated force producing change, a compelling effect. We
adopted this hybrid meaning not only because it more accurately describes
the impact of AIDS on contemporary America—social institutions have not
been destroyed—but because we quickly realized that social impact does
not merely destroy; it evokes a reaction or a response. It is more organic
than physical. Persons and societies do not merely feel the impact of an
event; they remake their lives and institutions to accommodate, negate, or
preserve its effects. In this report, we attempt to capture and describe the
process of impact and response of selected social institutions to the HIV/
AIDS epidemic.
The task of this panel was to go beyond, to the extent possible to
limited human vision, the impression of the extraordinary impacts of AIDS
on individual lives and on social institutions. We have tried to sort out
those that will endure in such a way as to force, or to invite, Americans to
take them into account in the next decade. This epidemic is not ordinary in
one quite specific way: it can be determined many years in advance of the
onset of actual illness in a patient that the illness will come. This epidemic
is not, like many historical epidemics, an invasion of morbidity and mortality that rapidly sweeps through a population. It comes and will stay for
years, not only in the population, but in the individual people infected, and
its presence will often be known to them and to others long before they
suffer the disabling, lethal effects. Similarly, rough estimates can be made
of the numbers of people who will begin to experience those disabling,
lethal effects years from now. Thus, Americans must think about this epidemic for many years into the future.
The institutions we studied appear to have absorbed the impact of AIDS
and accommodated to it in a very limited way. However, even a response
that is partial and apparently transitory may mark the beginning of more
fundamental change. Several of the institutions we studied may follow this
trajectory of limited initial response, followed some years later by very
r the National Research Counffects of the AIDS epidemic on
: United States and to describe
: impact of the epidemic. No
sive history—there are not yet
to base such an effort. Instead
istitutions for which sufficient
ind response. These descriphoritative; but we do believe
;em to the country and comng to deal with the epidemic
> RESPONSES
ns, only a few of which are
ie research community. The
junt as an impact: cumulaof t '* United States and on
t
ons—personal, prose
inizations that touch
h
3
�THE SOCIAL IMPACT OF AIDS IN THE U.S.
significant changes. These longer term responses would be interesting to
follow, and we hope that researchers will attempt to do so. However, the
panel did not attempt to suggest a methodology for longer term monitoring:
the data needs and methods of observation would be very different for the
individual institutions studied.
After extensive deliberation, the panel determined that it had sufficient
information and understanding to describe social impact and response for
six institutions (broadly defined):
•
the public health system
health care finance and delivery
clinical research and drug regulation
religion
voluntary organizations
the correctional system
These institutions were selected for several reasons: the panel members had
the competence to study and evaluate them, we judged that sufficient empirical data and informed opinion existed to formulate our own assessment
of impact and response, and they had not been treated in previous reports of
the parent committee. The six institutions chosen are very different in
structure, degree of centralization, and other dimensions. Such differences
affect the level of generalization appropriate to each area.
In the course of our work we also began to see another kind of impact
and response—on public policies not necessarily connected to institutions.
The HIV/AIDS epidemic has clearly had an impact on policies related to
families, and we thus decided to add to our. study an examination of two
policy areas: issues related to newborns and children and issues related to
intimate nonmarital relationships.
Finally, in addition to examining institutional systems as a whole and
selected family policies, the panel wanted to look at the impact of HIV/
AIDS on communities, where several institutions converge and where the
synergy resulting from that convergence is most clearly seen. Originally,
three case studies were envisioned: New York, Miami, and Sacramento.
We were able to complete only New York—a city that could never be
described as typical, but one that does vividly illustrate the impact and
response to AIDS among major social institutions.
It is common to find references to the impact of AIDS and HIV. It is
also rather common to find such references expressed in quite strong terms.
For example, Milbank Quarterly's two-volume study, A Disease of Society:
Cultural Responses to AIDS, opens with these words (Nelkin et al., 1991:1):
AIDS is no "ordinary" epidemic. More than a devastating disease, it is
freighted with profound social and cultural meaning. More than a passing
tragedy, it will have long-term, broad-ranging effects on personal relation-
INTRODUCTION AND SUMMARY
ships, social institutions, and
feeling mortality—though in
also costly in terms of the r
for research and medical can
beyond their medical and ecc
nize our individual and collei
It is not clear what an "c
seems ordinary to those who
voked comparison with many
bubonic plague (the Black De;
century is recalled: between 1
third of the population of Eur
died in Asia during the preced
had unquestionable impacts. I
emergence of nation states, th'
gious movements that led to
1976: Tuchman, 1978). As A;
"changed the minds of men" b
meaning of death, the place o
gious and social life. Changes
the most profound of all impa
social tragedy can propel institi
to affect lives far in the future
future import of the present in
not shrink from the task, espec
AIDS has been compared
bubonic plague in England in i
demies of the nineteenth cen
sixteenth century and the earl>
of the twentieth century (Brar
has its analogies to each of the
prevention, stigmatization of si
of authorities—all can be consons are often illuminating, bu
It can be said with some assi
epidemics was "ordinary." E;
subsequent commentators as "
The comparison with epidi
remembered about those plagu
on history or, as Campbell wrc
left social institutions that son
AIDS epidemic: cholera, fo:
epidemic disease that stressed
�SOCIAL IMPACT OF AIDS IM THE U.S.
responses would be interesting to
I attempt to do so. However, the
ology for longer term monitoring:
> would be very different for the
n
1 determined that it had sufficient
•e social impact and response for
ion
1 reasons: the panel members had
m.
idged that sufficient emto
.late our own assessment
ieen treated in previous reports of
3ns chosen are very different in
icr dimensions. Such differences
ate to each area.
ian to see another kind of impact
;ssarily connected to institutions,
an impact on policies related to
Dur study an examination of two
ind children and issues related to
itutional systems as a whole and
d to look at the impact of HIV/
:itutions converge and where the
s most clearly seen. Originally,
York, Miami, and Sacramento,
ark—a city that could never be
Avidly illustrate the impact and
itutions.
impact of AIDS and HIV. It is
. expressed in quite strong terms,
ume study, A Disease of Society:
:se words (Nelkin et al., 1991:1):
han a devastating disease, it is
m f l ^ ^ | . More than a passing
mg^^Hs on personal relation-
INTRODUCTION AND SUMMARY
ships, social institutions, and cultural configurations. AIDS is clearly affecting mortality—though in some communities more than others. It is
also costly in terms of the resources—both people and money—required
for research and medical care. But the effects of the epidemic extend far
beyond their medical and economic costs to shape the very ways we organize our individual and collective lives.
It is not clear what an "ordinary" epidemic would be. No epidemic
seems ordinary to those who experience it. The AIDS epidemic has invoked comparison with many epidemics of the past. Most commonly, the
bubonic plague (the Black Death) that devastated Europe in the fourteenth
century is recalled: between 1348 and 1350, some 20 million people, onethird of the population of Europe, died. (Additional tens of millions had
died in Asia during the preceding decade [McNeil, 1976].) This epidemic
had unquestionable impacts. Historians attribute to it, at least in part, the
emergence of nation states, the rise of mercantile economies, and the religious, movements that led to the Reformation (Campbell, 1931; McNeil
1976; Tuchman, 1978). As Anna Campbell (1931) noted, the Black Death
"changed the minds of men" bringing new ways of understanding God, the
meaning of death, the place of tradition, and the role of authority in religious and social life. Changes in the collective mind of a society might be
the most profound of all impacts, for the new ideas generated by a major
social tragedy can propel institutional change and outlast immediate changes
to affect lives far in the future. Difficult though it might be to predict the
future import of the present impact of the HIV/AIDS epidemic, one should
not shrink from the task, especially when one must plan for that future.
AIDS has been compared with other epidemics, too: the resurgence of
bubonic plague in England in the mid-seventeenth century, the cholera epidemics of the nineteenth century, the venereal disease epidemics of the
sixteenth century and the early twentieth centuries, and the polio epidemics
of the twentieth century (Brandt, 1988; Risse, 1988; Slack, 1988). AIDS
has its analogies to each of these epidemics—number of deaths, methods of
prevention, stigmatization of sufferers and presumed carriers, and responses
of authorities—all can be compared in general or in detail. The comparisons are often illuminating, but sometimes misleading (Fee and Fox, 1988).
It can be said with some assurance, however, that none of the historical
epidemics was "ordinary." Each had impacts that struck its sufferers and
subsequent commentators as "extraordinary."
The comparison with epidemics of the past invokes the features that are
remembered about those plagues. They have, in this respect, had an impact
on history or, as Campbell wrote (1931), "on the minds of men." They also
left social institutions that sometimes affect present-day thinking about the
AIDS epidemic: cholera, for example, left a public health approach to
epidemic disease that stressed quarantine; venereal diseases gave rise to the
�iii
BS
THE SOCIAL IMPACT OF AIDS IN THE U.S.
public health approach of contact tracing. These established public health
practices have had to be reconsidered in the current epidemic. Many of the
prominent, even dramatic impacts of past epidemics, however, have so melded
into the social fabric that people are often astonished to hear of them today,
and some, interesting though they be, seem of little relevance to the current
problem. For example, to attribute the existence of Protestant Christianity
to the effects of the Black Death on religious ideas and sentiments has little
influence on the ways in which people today think about religion or about
epidemics. Similarly, to attribute the existence of Canada as an independent nation to the fact that British troops had been vaccinated against smallpox before the Battle of Quebec, but American troops were decimated by
the disease, is certainly to point to an effect of epidemic and, indeed, an
impact. Yet that impact has been of little relevance to subsequent citizens
and governments, except that "some Canadians to this day worship smallpox as the deliverer from United States citizenship" (Foege, 1988:332).
Many features of epidemics are no longer remembered and have left
little imprint on the societies that they ravished for a time. Indeed, one of
the greatest of epidemics, the influenza of 1918-1920, has been called by its
historian "the forgotten epidemic" (Crosby, 1989). Worldwide, perhaps 30
million people died; in the United States, 675,000 people died, most of
whom were not the usual victims of influenza (the very old, infants, and
children), but men and women in their 20s and 30s. This terrible scourge
might have had a great impact, but it passed and left almost no mark on the
social institutions and practices of the time. Many people were mourned,
but life quickly returned to normal. Even the absence of impact has a
lesson for this study, it is possible that many of the effects currently taken
as important and lasting will pass or be absorbed into the course of American life and culture. It is not entirely clear how confidently one should
accept the words of Milbank editors Nelkin, Willis, and Parris (1991:1,2):
More than a passing tragedy, it [AIDS] will have long-term, broad-ranging
effects on personal relationships, social institutions, and cultural configurations . . . AIDS will reshape many aspects of society, its norms and
values, its interpersonal relationships and its cultural representations . . .
the future will be different from both the past and the present.
Our report suggests that, in some respects, the AIDS epidemic may be more
like the influenza of 1918 than the bubonic plague of 1348: many of its
most striking features will be absorbed in the flow of American life, but,
hidden beneath the surface, its worst effects will continue to devastate the
lives and cultures of certain communities.
INTRODUCTION AND SUMMAi
GENERAL 1
Historically, certain ej
tutions: the Black Death
enough laborers to cause a
nent. The HIV/AIDS epide
has not affected U.S. social
by the end of 1991 infecte
sickness to 206.392, and d
the structures or directions
of the responses have bee.
subside. Others may be m
accelerated changes alread)
It is the panel's opinio
can in part be explained 1
relative to the U.S. popuk
social institutions are stron
that another major reason l
the epidemic in socially ma:
shows that the HIV/AIDS
isolated groups and possibh
ers have recently comment
American population, as w:
persons who are also caugl
1988): poverty, poor healtl
joblessness, hopelessness, a
sonal and social life. These
infection and AIDS. Our sti
this dramatically for one e|
patterns shown there are rep
cal areas and strata of the
demic and probably never •
have been devastated and ar
This epidemiological di;
our major conclusion. The i
at those points at which the
example, the health care sy
new disease with some alac
cally in those places where
problems of caring for those
lar configuration of the U.:
greater extent than other de^
to-pay criteria. Providers, h
�- IMPACT OF AIDS IS THE U.S
e established public health
ent epidemic. Many of the
.s. however, have so melded
>hed to hear of them today,
tie relevance to the current
- of Protestant Christianity
as and sentiments has little
nk about religion or about
of Canada as an indepenn vaccinated against smalltroops were decimated by
epidemic and, indeed, an
mce to subsequent citizens
to this day worship small•ip" (Foege, 1988:332).
Tf
-jred and have left
f
ie. Indeed, one of
,ias been called by its
»)• Worldwide, perhaps 30
.000 people died, most of
(the very old, infants, and
30s. This terrible scourge
left almost no mark on the
any people were mourned,
absence of impact has a
the effects currently taken
i into the course of Ameniw confidently one should
lis, and Parris (1991:1,2):
92K„
long-term, broad-ranging
ns, and cultural configuf society, its norms and
:ural representations . . .
I the present.
DS epidemic may be more
gue of 1348: many of its
ow of American life, but,
I continue to devastate the
INTRODUCTION AND SUMMARY
GENERAL FINDINGS AND CONCLUSIONS
Historically, certain epidemics have done great damage to social institutions: the Black Death in a 3-year sweep through Europe wiped out
enough laborers to cause a major restructuring of the economy of the continent. The HIV/AIDS epidemic, although often compared to the Black Death,
has not affected U.S. social institutions to any such extent. Although it had
by the end of 1991 infected perhaps 1 million people, brought devastating
sickness to 206,392, and death to 133,233, it had not significantly altered
the structures or directions of the social institutions that we studied. Many
of the responses have been ad hoc and may be reversed when pressures
subside. Others may be more lasting, but only because they reinforced or
accelerated changes already latent or budding within the institutions.
It is the panel's opinion that the limited responsiveness of institutions
can in pan be explained because the absolute numbers of the epidemic,
relative to the U.S. population, are not overwhelming, and because U.S.
social institutions are strong, complex, and resilient. However, we believe
that another major reason for this limited response is the concentration of
the epidemic in socially marginalized groups. The convergence of evidence
shows that the HIV/AIDS epidemic is settling into spatially and socially
isolated groups and possibly becoming endemic within them. Many observers have recently commented that, instead of spreading out to the broad
American population, as was once feared, HIV is concentrating in pools of
persons who are also caught in the "synergism of plagues" (see Wallace,
1988): poverty, poor health and lack of health care, inadequate education,
joblessness, hopelessness, and social disintegration converge to ravage personal and social life. These coexisting conditions foster and aggravate HIV
infection and AIDS. Our study of New York City (see Chapter 9) illustrates
this dramatically for one epicenter of the epidemic. We believe that the
patterns shown there are repeated throughout the country: many geographical areas and strata of the population are virtually untouched by the epidemic and probably never will be; certain confined areas and populations
have been devastated and are likely to continue to be.
This epidemiological direction reveals the disconcerting implications of
our major conclusion. The institutions that we studied are particularly weak
at those points at which the epidemic is likely to be most destructive. For
example, the health care system, which responded to the appearance of a
new disease with some alacrity, is weakest organizationally and economically in those places where the affected populations are concentrated. The
problems of caring for those who are infected are magnified by the particular configuration of the U.S. health care system, which emphasizes to a
greater extent than other developed countries private insurance and abilityto-pay criteria. Providers, hospitals, and public health mechanisms can and
.it.:
\:.'
!
i +-1
•>
i
.»
IJ
I
i\
Jl
i4
�8
THE SOCIAL IMPACT OF AIDS IN THE U.S.
have responded to a flood of patients with AIDS, but those responses were
most successful where health care was better organized and financed and
where the populations to be served had sufficient knowledge to understand
the disease and its modes of transmission and were capable of organizing
themselves in ways that supported and supplemented the health care system.
Thus, our most general conclusion about the epidemic is that its impact
has hit institutions hardest where they are weakest: serving the most disadvantaged people in U.S. society. Predictions of the imminent collapse of
the health care system due to the epidemic, for example, now look shrill,
but, conversely, hopes that the epidemic would force the country toward
more rational and equitable reform of the system now also seem unrealistic.
In the panel's judgment, the HIV/AIDS epidemic has effected many transient changes in the institutions that we studied and relatively few changes
that we expect to be permanent. Among the more permanent, however, two
are particularly noteworthy.
First, the institutions of public health, of health care delivery, and of
scientific research have become more responsive to cooperation and collaboration with "outsiders." Policies and practices have been modified in
these three institutions under pressure from and in collaboration with those
who are affected by the epidemic and their advocates. Many of these
changes are positive and will contribute to the efficiency and efficacy of the
institutions. Similarly, volunteer organizations stimulated by the challenge
of the epidemic have discovered ways not only of supplying help where
extant institutions were lacking, they have also influenced the policies and
practices of those institutions.
Second, even in institutions with very defined purposes and strong constraints—institutions as different as religious groups and correctional agencies—the response to the epidemic has reflected awareness of the scientific
realities, as well as the social implications, of HIV/AIDS. Traditionally
based doctrinal constraints in the case of religious groups and the stringent
requirements of civil punishment in the case of correctional agencies are
powerful forces that could and did dictate rigid and narrow response. Yet,
powerful as those forces were, they did not negate more reflective responses
that contributed to containment of the epidemic and respected the rights of
individuals. We are concerned, however, that as the epidemic strikes with
greater force in socially and economically deprived communities, the directions toward more communal involvement and respect for civil and personal
liberties might be constricted and diverted.
The panel believes that a failure by scientists and policy makers to
appreciate the interaction between social, economic, and cultural conditions
and the propagation of HIV/AIDS disease has often led to public misunderstanding and policy mistakes about the epidemic. Although in the beginning of the epidemic, gay life and behavior were certainly at the center of
^.fc;.vSV>fr-r..'»;-j
INTRODUCTION AND SUMMAR)
attention, even then they w.
and not as social contexts
around which strong forces
rally. Similarly, intravenou
that could transmit infection
economic conditions was igi
A constant theme of this
discrimination, and inequali
disease settled among socia
progressed, AIDS has incre;
little economic, political, a
undemocratic affliction. In '
nicable illnesses cut across i
community at large. In tra.
edge and technology, epider
the modem world, particula
bidity and mortality are oftet
HIV/AIDS, the concentration
those who were, for a varie:
groups. In this case, the b
social inequalities and result!
certain regions and among <
pattern has created tension bi
of the epidemic and the nee
demic from among individu
from the social groups that
epidemic becomes endemic i
this tension will be intensifie
If the current pattern of
have been able to wait out th
the crisis period will have ;
"disappear," not because, likt
those who continue to be af
sight and attention of the ma
SPECIFIC Fir
The public health systet
absorbed the first shock of i
forefront of research and po
concentration of the epidemic
�:/AL IMPACT OF AIDS IN THE U.S.
DS, but those responses were
r organized and financed and
ient knowledge to understand
d were capable of organizing
nented the health care system,
the epidemic is that its impact
>kest: serving the most disadof the imminent collapse of
for example, now look shrill,
uld force the country toward
em now also seem unrealistic,
emic has effected many traned and relatively few changes
nore permanent, however, two
;
;
'
care delivery, and of
^
cooperation and colictu.^ nave been modified in
nd in collaboration with those
r advocates. Many of these
efficiency and efficacy of the
is stimulated by the challenge
'nly of supplying help where
;o influenced the policies and
med purposes and strong congroups and correctional agened awareness of the scientific
of HIV/AIDS. Traditionally
;ious groups and the stringent
of correctional agencies are
id and narrow response. Yet,
zate more reflective responses
ic and respected the rights of
: as the epidemic strikes with
rived communities, the direcrespect for civil and personal
enlists and policy makers to
iomic, and cultural conditions
ofte^ed to public misunderrn^B.lthough in the beginer^ffrtainly at the center of
INTRODUCTION AND SUMMARY
9
attention, even then they were noted primarily as "modes of transmission"
and not as social contexts in which the disease had particular meanings
around which strong forces for care, prevention, and political action could
rally. Similarly, intravenous drug use was understood as a social behavior
that could transmit infection, but its place in a matrix of social, cultural, and
economic conditions was ignored.
A constant theme of this report and of the AIDS literature is the stigma,
discrimination, and inequalities of the AIDS epidemic. At its outset, HIV
disease settled among socially disvalued groups, and as the epidemic has
progressed, AIDS has increasingly been an affliction of people who have
little economic, political, and social power. In this sense, AIDS is an
undemocratic affliction. In "democratic epidemics" (Arras, 1988), communicable illnesses cut across class, racial, and ethnic lines and threatens the
community at large. In traditional societies with limited medical knowledge and technology, epidemics fall on most, if not all, of the people. In
the modem world, particularly in industrial societies, inequalities in morbidity and mortality are often more social than biological phenomena. With
HIV/AIDS, the concentration of the epidemic from its beginnings was among
those who were, for a variety of reasons, members of marginalized social
groups. In this case, the biology of viral transmission matched existing
social inequalities and resulted in an unequal concentration of HIV/AIDS in
certain regions and among certain populations (see Grmek, 1990). This
pattern has created tension between the social and geographical localization
of the epidemic and the need to mobilize resources to deal with the epidemic from among individuals, groups, and institutions that are removed
from the social groups that are at the epicenter of the epidemic. As the
epidemic becomes endemic in already deprived and segregated populations,
this tension will be intensified.
If the current pattern of the epidemic holds, U.S. society at large will
have been able to wait out the primary impact of the epidemic even though
the crisis period will have stretched out over 15 years. HIV/AIDS will
"disappear," not because, like smallpox, it has been eliminated, but because
those who continue to be affected by it are socially invisible, beyond the
sight and attention of the majority population.
SPECIFIC FINDINGS AND CONCLUSIONS
Public Health
The public health systems of the country—federal, state and local—
absorbed the first shock of the AIDS epidemic and have remained at the
forefront of research and policy development. Because of the increasing
concentration of the epidemic in low-income and minority communities, the
�i£2
THE SOCIAL IMPACT OF AIDS IN THE U.S.
INTRODUCTION AND SUMMAR
public health system at the local level has become the primary service
provider for a large proportion of people with HIV disease or AIDS. Nowhere is this more apparent than in New York City.
HIV/AIDS challenged the public health community to set aside many
of its traditional policies and practices for the containment of infectious
disease. Quarantine, mass mandatory testing, and contact tracing all had
notable disadvantages in dealing with a disease with a long latency period,
that was spread chiefly through sexual activity or intravenous drug use, and
that largely affected already stigmatized groups. Spokesmen for the affected groups, particularly the gay community, advanced other methods of
containment that relied on community education and voluntary anonymous
testing. This came to be know as an "exceptionalist" approach since it
differed from responses to prior epidemics. However, mass education and
other approaches to behavior modification were already emerging as the
public health strategy of choice for substance abuse prevention, smoking,
and behavioral disorders. Thus, HIV/AIDS accelerated the adoption of
these approaches and invited their intensive application to an infectious
disease. It also created a political environment that compelled the public
health community to negotiate containment strategies with the population
that was initially primarily infected—gay men.
As the second decade of the epidemic begins, some aspects of the
exceptionalist approach are being reexamined and abandoned. More traditional public health methods are being reintroduced, although in forms modified
^^Jiy the experience of the first decade. _The_changejs due in part to the
^availability of early treatment, which to infected individuals make's^arTy
\ "Identification more useful. It may also be the result of the steady shift of
\ the epidemic itself into populations that are less politically potent than the
' gay community, primarily intravenous drug users and their sexual partners.
Overall, the impact of the epidemic on the public health system has
been pervasive: it has prompted a critical examination of traditional responses to epidemics of infectious disease, challenged the public health
community to devise more effective strategies for promoting behavioral
change, and, because of the sheer size of the HIV/AIDS-related activities
profoundly influenced the public's perception of the public health systems.
HIV/AIDS has also increased the range of clinical responsibilities of public
health agencies and further strained already burdened resources. In many
cities, this has resulted in the neglect of traditional areas of public health
activities such as sexually transmitted disease and tuberculosis.
The inextricable link between HIV disease and other diseases and conditions prevalent in poor populations (e.g., drug addiction, tuberculosis, and
sexually transmitted diseases) means that public health providers will face
even greater challenges as the HIV/AIDS epidemic unfolds in the 1990s.
The newer views and practices of public health may revert into more tradi-
tional ways as the epidemr
niques are more difficult i
opportunity and a challengi
health, both with regard to
that represent so much of
todav.
10
The HIV/AIDS epidem
system over the last decade
more. A substantial propon
the uninsured or patients w
to job loss or benefit rest;
patients challenged the pro
were generally young and
styles that affronted many i;
transmission were well und>
tact with AIDS patients, anc
with unfamiliar problems o
while preserving the privac\
patients from infection. Th'
that many AIDS patients c
health care delivery system
sorbed the brunt of the epid
of the epidemic, there is a
ticularly public and volunta
ity of hospitals to absorb AI
the stigma and inadequate r
The complexity of the (
provision of services. HIV
the body. The diverse anc
tern—reinforced by the reir
pay for care—has been ofte
sive, coordinated primary c;
subspecialists. And it is
necessary to cope with a di
ited to any one organ systen
based care for AIDS patient
management approaches.
AIDS has influenced 1
ways. The specialty of infc
now viewed as one of the
�SOCIAL IMPACT OF AIDS IN THE US.
INTRODUCTION AND SUMMARY
ias become the primary service
with HIV disease or AIDS. Noork City.
h community to set aside many
r the containment of infectious
ing. and contact tracing all had
ease with a long latency period,
ity or intravenous drug use. and
iroups. Spokesmen for the aflity, advanced other methods of
ation and voluntary anonymous
•iceptionalist" approach since it
However, mass education and
were already emerging as the
nc
= prevention, smoking,
:
>S
rated the adoption of
ve application to an infectious
ment that compelled the public
[ strategies with the population
en.
c begins, some aspects of the
;d and abandoned. More tradiuced. although in forms modified
e_change is due in part to the
fected individuals makeTearTy
he result of the steady shift of
less politically potent than the
users and their sexual panners.
the public health system has
examination of traditional rechallenged the public health
lies for promoting behavioral
e HIV/AIDS-related activities
i of the public health systems,
nical responsibilities of public
burdened resources. In many
iitional areas of public health
: and tuberculosis,
ie and other diseases and conJg M o t i o n , tuberculosis, and
' l i ^ ^ B t h providers will face
•idei^unfolds in the 1990s,
th may revert into more tradi-
tional ways as the epidemic settles in communities where the newer techniques are more difficult to implement. The epidemic thus presents an
opportunity and a challenge for the revitalization of the practice of public
health, both with regard to infectious conditions and the chronic disorders
that represent so much of the task of public health in the United States
today.
11
Health Care
The HIV/AIDS epidemic has sent more than 200,000 patients into that
system over the last decade and may, in this decade, send up to 1 million
more. A substantial proportion of these patients are drawn from the pool of
the uninsured or patients who rapidly exhaust their insurance benefits due
to job loss or benefit restrictions. The people who became HIV/AIDS
patients challenged the provider community on a number of fronts: they
were generally young and previously healthy people who engaged in life
styles that affronted many in the provider community. Before the modes of
transmission were well understood, many health care personnel feared contact with AIDS patients, and both hospitals and private physicians struggled
with unfamiliar problems of how to provide sensitive and responsive care
while preserving the privacy of AIDS patients and protecting staff and other
patients from infection. These problems have been complicated by the fact
that many AIDS patients cannot pay for care, and thus the subset of the
health care delivery system that provides care to indigent patients has absorbed the brunt of the epidemic. In the handful of cities that are the focus
of the epidemic, there is a serious strain on the provider community, particularly public and voluntary teaching hospitals; in other cities, the capacity of hospitals to absorb AIDS inpatients is not as pressing a concern as are
the stigma and inadequate reimbursement associated with AIDS care.
The complexity of the disease remains another major challenge for the
provision of services. HIV disease attacks virtually every organ system of
the body. The diverse and uncoordinated nature of the U.S. health system—reinforced by the reimbursement practices of the multiple plans that
pay for care—has been often criticized for its failure to provide comprehensive, coordinated primary care and for too great a reliance on specialists and
subspecialists. And it is just such comprehensive, primary care that is
necessary to cope with a disease that is chronic and disabling and not limited to any one organ system. The urgent need for coordinated communitybased care for AIDS patients has pushed the development of improved case
management approaches.
AIDS has influenced health care providers in both direct and subtle
ways. The specialty of infectious disease has enjoyed a renaissance and is
now viewed as one of the few shortage medical specialties. Concern is
�THE SOCIAL IMPACT OF AIDS IN THE U.S.
INTRODUCTION AND SUMMAR
growing, however, that the burden of the epidemic may further dissuade
young physicians from entering specialties such as internal medicine or
from practicing in a geographic location where the burden of caring for
patients with HIV disease is perceived to be high. The care of AIDS
patients in terminal stages of the disease falls very heavily on hospitalbased nurses. Like the practice of oncology nursing, it is an emotionally as
well as professionally demanding experience. It is impossible to assess the
extent to which the HIV/AIDS epidemic has exacerbated staffing problems
in hospitals and other institutional settings that care for AIDS patients;
however, a shortage of nurses has been identified as a major obstacle to
improved care of AIDS patients.
All health professionals are at risk of HIV infection through exposure
by accidental cuts or punctures incurred while caring for HIV-infected patients. Procedures adopted to protect health care workers from accidental
infection (universal precautions) are designed to avoid exposure to blood
and body fluids regardless of whether patients or health care workers are
believed to be infected. The techniques and behaviors in the health care
setting that must be modified to reduce HIV transmission risks, however,
may be as difficult to change as risky sexual behavior and drug-use habits.
Health care procedures are learned behaviors and habits of years duration.
The risk of transmission from patients to providers has been overshadowed
in public attention by the extremely minor risk of transmission from providers to patients.
These and other considerations have made AIDS the most profound
challenge to the care of patients that has faced the health care provider
community in modem times. A substantial proportion of physicians avoid
caring for patients with HIV disease or AIDS. This avoidance or outright
refusal may result in a broad range of harm: in addition to leaving some
patients without needed care, it stigmatizes patients and adds to the considerable psychological burdens of living with the disease. The avoidance or
refusal also increases the risk for health care professionals who remain
willing to treat patients and hence assume a disproportionate burden of the
HIV/AIDS epidemic.
AIDS has challenged the economic arrangements of the health care
system in many ways. Most visible, perhaps, has been the conflict over
access to new drugs and a "fair price" for new therapeutic agents. The
introduction of universal precautions in hospitals has significantly increased
the demand for barrier protection and hence the cost of hospitalization for
all patients. The HIV/AIDS epidemic has also expanded fissures already
present in the health insurance system: the expense of the disease has
caused insurance firms to use all available markers to avoid enrolling AIDS
patients; and group plans have in many cases been modified to exclude the
cost of AIDS treatments. As providers struggle to cope with uninsured
patients, and patients stru;
another voice has been addi
problem of health care fina
12
Clinical R
In perhaps no other at
been more clear than in the
new drugs and in the con<
change wrought by AIDS i
crease in public awareness
trials. Debate about the etl
curs not only among physic
patients, activists, and polit
and politicized the aspects
largely within the private pi
The modem history of
that the interplay of politic
ongoing dynamic during th
influenced by AIDS, but the
was building in the systen
concepts. The introduction i
drug regulation in clinical tri
related changes to the scient
procedures lack clarity or cc
community-based physician
tions of how to organize an
cally be expected from them
sions of experimental therapi
that produces replicable resthe research community by
come relevant to many othi
patients and their advocates
HIV/AIDS has similarly
communication through pee
scientific peers is time const
queuing for a place in the j
submission of a manuscript t
system has been accepted m
objective assessment of the
AIDS, however, surfaced wi
of research that appears to si
diseases or that demonstrate;
�13
. IMPACT OF AIDS IN THE U.S.
INTRODUCTION AND SUMMARY
mic may further dissuade
h as internal medicine or
the burden of caring for
iigh. The care of AIDS
very heavily on hospitalng, it is an emotionally as
is impossible to assess the
:erbated staffing problems
: care for AIDS patients;
ed as a major obstacle to
patients, and patients struggle to pay for drugs and services they need,
another voice has been added to the call for a comprehensive solution to the
problem of health care financing.
nfection through exposure
iring for HIV-infected pa- workers from accidental
•
'
'xposure to blood
r
care workers are
taviors in the health care
nsmission risks, however,
ivior and drug-use habits.
habits of years duration,
s has been overshadowed
transmission from providMDS the most profound
the health care provider
'rtion of physicians avoid
his avoidance or outright
addition to leaving some
:s and adds to the considsease. The avoidance or
rofessionals who remain
jportionate burden of the
nents of the health care
s been the conflict over
therapeutic agents. The
as significantly increased
ost of hospitalization for
xpanded fissures already
eiu^of the disease has
t ^ ^ B d enrolling AIDS
minified to exclude the
to cope with uninsured
Clinical Research and Drug Regulation
In perhaps no other area has the impact of the HIV/AIDS epidemic
been more clear than in the identification, clinical testing, and regulation of
new drugs and in the conduct of clinical research. The most profound
change wrought by AIDS in drug development is simply the dramatic increase in public awareness of the nature, structure, and purpose of clinical
trials. Debate about the ethics and scientific validity of clinical trials occurs not only among physicians, statisticians, and ethicists, but also among
patients, activists, and politicians. AIDS has to a large degree publicized
and politicized the aspects of clinical investigation that were heretofore
largely within the private purview of the scientific community.
The modem history of clinical research and drug development shows
that the interplay of politics, science, and ethics must be recognized as an
ongoing dynamic during the twentieth century. The systems have been
influenced by AIDS, but the effect has been more to accelerate change that
was building in the system rather than to introduce fundamentally new
concepts. The introduction of a parallel track model in clinical research and
drug regulation in clinical trials is perhaps the most disquieting of the AIDSrelated changes to the scientific community, since both the purposes and the
procedures lack clarity or consensus. Pressure to expand clinical trials into
community-based physicians' practices has similarly posed difficult questions of how to organize and support such trials, what results can realistically be expected from them, and how to distinguish between ad hoc extensions of experimental therapies into community practice and clinical research
that produces replicable results. Although these questions were thrust on
the research community by the HIV/AIDS epidemic, they will quickly become relevant to many other fields of research as increasing numbers of
patients and their advocates seek access to the newest therapies.
HIV/AIDS has similarly challenged the traditional mode of scientific
communication through peer-reviewed journals. That review process by
scientific peers is time consuming, and the combination of review time and
queuing for a place in the journals may result in long lag times between
submission of a manuscript and publication. The cumbersome nature of the
system has been accepted until now because of the safeguards it offers for
objective assessment of the accuracy and relevance of research findings.
AIDS, however, surfaced widespread objections to the delayed publication
of research that appears to show a significant therapeutic benefit for serious
diseases or that demonstrates a previously unknown toxicity of an accepted
5
�14
THE SOCIAL IMPACT OF AIDS IN THE U.S.
therapy. HIV/AIDS studies have not been the only ones in which disclosure
before publication has occurred, but the intervention of AIDS activists has
thrust the dilemma more squarely into the spotlight. The scientific community is grappling with the difficult problems of how to implement a more
pragmatic yet still responsible approach to traditional peer review.
Although it is impossible at this time in the epidemic to reach any
definitive conclusions about the impact of AIDS on clinical research and
the regulation of new drugs, it is apparent that patient activism and the
exigencies of the AIDS epidemic have generated the most significant reevaluation of the research and regulation process to occur since World War II.
Voluntary and Community-Based Organizations
Government at all levels was slow to respond to the HIV/AIDS epidemic. The slow response was due partly to a general reduction in the
growth of public spending on health care and social welfare and partly to a
unique attribute of AIDS: its early association with two highly stigmatized
minorities—gay men and intravenous drug users. When governments did
respond, their flexibility and capacity to reach the groups in greatest need
were limited, especially in regard to prevention education, for which there
were constraints on how public monies could be used.
The vacuum was filled very early by an outpouring of volunteer activity. This was in part the result of the pulling together of the gay community
in the belief that its members could best care for their own. The movement
is also illustrative, however, of collective behavior in a period of social
change and the forces that motivate individuals to volunteer their time. The
response and mobilization of AIDS volunteers sheds light on the commitments individuals are willing to make to different kinds of social causes and
it also points to new directions for understanding the meaning of volunteer
work. In both San Francisco and New York, the AIDS crisis catalyzed
volunteer movements that spanned both individual helping activities and
strategic political campaigns. Particularly in San Francisco, the movement
was innovative, effective, and enormously important in helping the gay
community come to terms with the epidemic, as well as in shaping the
response of the city's institutions to it.
Throughout the country, volunteer movements have carried a surprisingly large share of the burden of caring for AIDS patients, particularly
outside hospitals. The cost of the epidemic for public agencies and private
insurance has been significantly reduced by the extensive contributions of
time and resources from volunteers. In addition, advocacy for appropriate
social policies that would both contain the epidemic and protect the rights
of affected individuals came from community-based organizations. At present,
this powerful force has been weakened somewhat by financial constraints.
m
m
INTRODUCTION AND SUMMAR)
burnout, and bureaucratizati
teering will provide the sa
deprived communities, in w
has to the gay communities
Religii
Religion, manifested in ;
is a large part of American
nations and of religiously id
important feature of the ep
evoked a response from rel
themselves with the beliefs c
linked early church traditioi
sinfulness in general with
though the roots of this ass
forgotten by most modem Cl
in the collective memory of
punishment visited on homos
touched others as well, that |
it has not been wholly abana
From time immemorial,
place for pestilential diseast
time when religious and the
many ways from what they
religious traditions have sef
relation between theological
even those who believe that t
world do not always see th;
Thus, today, religions have rt
way. They have almost in.
powerful beliefs of the past
interpretations of the present
The religious response h;
particularly the sexual behav
disease and, to some extent
public health educators and a
grounds, religion has been ii
Yet many churches have en;
support of persons with AIC
come active educators about
tion and prevention. The res|
�15
7IAL IMPACT OF AIDS IN THE U.S.
INTRODUCTION AND SUMMARY
only ones in which disclosure
vention of AIDS activists has
'tlight. The scientific commuof how to implement a more
iditional peer review,
n the epidemic to reach any
IDS on clinical research and
that patient activism and the
rated the most significant re;s to occur since World War II.
burnout, and bureaucratization. There is also doubt that the ethos of volunteering will provide the same benefits to the economically and socially
deprived communities, in which the epidemic is increasingly centered, as it
has to the gay communities in which it was first identified.
•d Organizations
spond to the HIV/AIDS epi;o a general reduction in the
social welfare and partly to a
T'
'o highly stigmatized
ie
jen governments did
h trie groups in greatest need
an education, for which there
be used.
>utpouring of volunteer activJgether of the gay community
or their own. The movement
:havior in a period of social
i to volunteer their time. The
s sheds light on the commitsnt kinds of social causes and
ing the meaning of volunteer
i , the AIDS crisis catalyzed
v'idual helping activities and
San Francisco, the movement
nportant in helping the gay
:, as well as in shaping the
nents have carried a surprisAIDS patients, particularly
r public agencies and private
ie extensive contributions of
on, advocacy for appropriate
demic and protect the rights
secy^anizations. At present.
h^^Bfinancial constraints.
Religion and Religious Groups
Religion, manifested in personal belief and in organized denominations,
is a large part of American life. The responses of major religious denominations and of religiously identified individuals to HIV/AIDS have been an
important feature of the epidemic: from the beginning, HIV/AIDS has
evoked a response from religious groups and from persons who identify
themselves with the beliefs of those groups. Some adherents of Christianity
linked early church traditions that saw plague as a divine punishment for
sinfulness in general with the single sin of male homosexuality. Even
though the roots of this association in early Christian doctrine have been
forgotten by most modem Christians, this ancient association seems to echo
in the collective memory of those who are ready to view AIDS as divine
punishment visited on homosexuals. As it became evident that the infection
touched others as well, that position became more difficult to maintain, but
it has not been wholly abandoned.
From time immemorial, religious tradition and teaching have had a
place for pestilential disease. This new pestilence, however, arrives at a
time when religious and theological beliefs and practices are different in
many ways from what they were in the past. They are more diverse, for
religious traditions have separated into many branches. In addition, the
relation between theological and scientific understanding is more complex;
even those who believe that divine causality stands behind the events of the
world do not always see that relationship in a direct, unambiguous way.
Thus, today, religions have reacted to the HIV/AIDS epidemic in a complex
way. They have almost inevitably done so with some reference to the
powerful beliefs of the past, but also with the more subtle and nuanced
interpretations of the present.
The religious response has generally involved censure of the behaviors,
particularly the sexual behaviors, that were implicated in the spread of the
disease and, to some extent, also criticized the degree of frankness that
public health educators and activists have advocated in education. On these
grounds, religion has been indicated as obstructionist about the epidemic.
Yet many churches have engaged in extensive programs for the care and
support of persons with AIDS and have, within their doctrinal limits, become active educators about the epidemic with regard to both discrimination and prevention. The response of religious groups to the epidemic is, of
�16
THE SOCIAL IMPACT OF AIDS IS THE U.S.
course, defined by the doctrinal commitments of the various faiths, as well
as by the attitudes of their congregations.
Because of the role of religious institutions in U.S. society, as well as
the large number of people who identify with some religious group in the
United States, it is important to elucidate the role that religious organizations have played in the epidemic and to understand the importance of
taking their response into account in efforts to understand the impact of
AIDS in American society. Overall, as the second decade of the epidemic
begins, religious organizations have only begun to contribute to efforts to
contain the epidemic or to deal with some of the social issues that surround it.
Correctional Systems
Approximately 1 million individuals are currently confined in prisons
and local jails in the United States—426 out of every 100,000 residents.
They are disproportionately black men, for whom the rate is 3,109 per
100,000. Since the beginning of the HIV/AIDS epidemic, the population in
federal prisons and in prisons in the District of Columbia and 18 states has
doubled. In Califomia and New Jersey, two states hit particularly hard by
the epidemic, the number of inmates tripled during the same period. The
incarcerated population in the United States comprises in large part impoverished individuals from urban areas. Almost one-half of all prisoners are
black. Not only are the majority of prisoners members of racial and ethnic
minority groups, they are also overwhelmingly poor.
As the nation's prison population has burgeoned, so too has the population of inmates with HIV disease. The seroprevalence status of all inmates
is not known, but it is certainly highly variable by region. In New York
State prisons, approximately 17-20 percent of prisoners are HIV positive,
which is probably the high end of the distribution. The question of whether
to screen inmates for HIV antibodies has arisen with particular urgency in
the prison setting, with no general resolution.
The question of whether to segregate HIV-positive inmates has been
answered variously in different prison systems. In addition to concerns
about transmission through forced or consensual sex, much attention has
been paid to highly unlikely modes of transmission—casual contact or assaultive
behaviors by HIV-positive inmates. Other potential mechanisms of disease
spread are unique to prison culture and difficult to evaluate. At least 20
state prisons segregate all prisoners with AIDS, 8 segregate those with
AIDS-related complex, and 6 segregate inmates who are HIV positive but
not symptomatic. Segregation decisions have been justified on the grounds
of inmate security, reducing the risk of transmission, or availability of specialized services. However, there is also widespread evidence that segregation is harmful, denying prisoners access to a range of services and expos-
ISTRODUCTION AND SUMMARY
ing them to additional stign
terns have instituted HIV pi
staff.
Prisons have found it d
inmates with AIDS. In mc
come from corrections syst
beyond the breaking point,
the correctional system's he;
is earmarked for HIV/AIDS
care because treatments tenc
some jurisdictions the impac
sider how prison health care
ways to attract and retain qu.
One of the most signif
facilities may be a sea chan:
search involving prisoners is
oners from exploitation at th
gators are now being looked
block prisoners from receivir
Public Polic
When the HIV/AIDS ep
and intimate relationships wi
demic has raised difficult qi
transmitted perinatally, publi
mothers and their fetuses anc
family support had to be rec
people living in unconventic
inheritance, and housing and
conventional family structure
Social policy regarding !
encodes certain features of p
mutated by public agencies,
times lead to litigation. Cc
impact of the epidemic on
aware of their extreme compl
the interaction between the
study examined issues of par
and New York. The second
familial relationships evolvec
in San Francisco and New Y(
Proposals for the mandat
m
�17
IAL IMPACT OF AIDS IN THE U.S.
INTRODUCTION AND SUMMARY
of the various faiths, as well
ing them to additional stigma and likelihood of assault. Most prison systems have instituted HIV prevention education programs for inmates and
staff.
Prisons have found it difficult to respond to the health care needs of
inmates with AIDS. In most cases, funds for HIV care in prisons must
come from corrections systems budgets that are already strained almost
beyond the breaking point. In New York State, for example, two thirds of
the correctional system's health care budget of approximately $100 million
is earmarked for HIV/AIDS care. AIDS tests the limits of prison health
care because treatments tend to be expensive and difficult to deliver. In
some jurisdictions the impact of AIDS is causing prison officials to reconsider how prison health care is delivered and paid for and to look at new
ways to attract and retain quality medical staff.
One of the most significant impacts of HIV disease in correctional
facilities may be a sea change in the way epidemiological and clinical research involving prisoners is viewed. Regulations adopted to protect prisoners from exploitation at the hands of drug companies or clinical investigators are now being looked at in an entirely different light when they may
block prisoners from receiving experimental treatments.
is in U.S. society, as well as
some religious group in the
role that religious organizaiderstand the importance of
to understand the impact of
cond decade of the epidemic
jn to contribute to efforts to
social issues that surround it.
ns
ur
confined in prisons
ol
100,000 residents,
vhoti. the rate is 3,109 per
epidemic, the population in
Columbia and 18 states has
ates hit particularly hard by
jring the same period. The
uprises in large part impov3ne-half of all prisoners are
icmbers of racial and ethnic
poor.
oned, so too has the popula• alence status of all inmates
e by region. In New York
prisoners are HIV positive,
n. The question of whether
with particular urgency in
-positive inmates has been
In addition to concerns
al sex, much attention has
—casual contact or assaultive
itial mechanisms of disease
t to evaluate. At least 20
S, 8 segregate those with
wj^w-e HIV positive but
t ^ ^ B f i e d on the grounds
i i o n ^ r availability of speread evidence that segregange of services and expos-
Public Policies on Children and Families
When the HIV/AIDS epidemic began, law and policy about families
and intimate relationships were in transition, as they still are, and the epidemic has raised difficult questions. For example, because AIDS can be
transmitted perinatally, public policies regarding the relationships between
mothers and their fetuses and the care of sick children without maternal or
family support had to be reconsidered. Because HIV/AIDS often affects
people living in unconventional relationships, issues of health insurance,
inheritance, and housing and health decisions—which are usually linked to
conventional family structures—called for reexamination.
Social policy regarding family relationships is complex: specific law
encodes certain features of policy, but much is embedded in practices formulated by public agencies, employers, and insurers—practices that sometimes lead to litigation. Convinced of the importance of examining the
impact of the epidemic on policies regarding families and children, yet
aware of their extreme complexity, the panel undertook two case studies of
the interaction between the epidemic, law, and public policy. The first
study examined issues of parental authority and foster parenting in Miami
and New York. The second study examined how the legal definition of
familial relationships evolved in two political and legislative controversies,
in San Francisco and New York.
Proposals for the mandatory testing of all newborns or of all pregnant
�18
THE SOCIAL IMPACT OF AIDS IN THE U.S.
women have raised long-standing disputes about public health needs and
individual privacy and about the needs or rights of children as they may
conflict with the rights of parents. Similarly, issues involved in caring for
HIV-infected children or enrolling them in clinical trials of experimental
therapies has starkly highlighted continuing arguments over the rights of
biological parents versus the rights of foster parents or the state. In both
cases, our study showed that there has as yet been no fundamental changes
in broad policies, only changes in the clinical care and social services in
certain communities. The rights of biological parents—regardless of their
own degree of illness or ability to care for their children—have rarely been
overridden in deciding on what will happen to their children.
There have been significant changes in the legal recognition of unmarried couples in some communities in recent years, but those changes were
under way before the HIV/AIDS epidemic began, and it is impossible to
determine exactly what role the epidemic played in bringing them about. In
San Francisco, a domestic partnership ordinance was enacted in 1990, after
failures in 1982 and 1989. It seems likely that the epidemic—and the
increased organization among the gay and lesbian community in its wake—
contributed to its passage. Similarly in New York, changes in the definition
of "family" in relation to housing rights were, similarly, probably in part a
result of effects of the HIV/AIDS epidemic.
In general, as the epidemic begins to center on economically and socially deprived communities, children will be increasingly affected. Bom
to infected mothers, they will be in need of special care and attention from
their births. Some mothers die soon after their children's births, and many
others are unable or unwilling, for financial and health reasons, to care for
their children. In several cities where the problems are already noticeable,
serious efforts have been made to meet those challenges. Still, those efforts
reveal the basic tensions, inconsistencies, and anomalies in family policies
that will need to be resolved as the epidemic becomes more endemic in
those cities.
The epidemic first attacked the population of gay men. Such men have
had to live outside the range of social policies that favored heterosexual
couples joined in legal marriage and thus were often deprived of insurance,
tax and inheritance benefits, and other legal rights and protections accorded
to married couples. At the same time, gay men often are joined in enduring
relationships and, in those relationships, often provide support and care to
their ill partners. The effort to gain some social and legal recognition of
those partnerships, already growing before the HIV/AIDS epidemic, was
given some impetus by the epidemic. Questions about appropriate legal
definitions of familial relationships will continue to be raised at least as
long as the epidemic continues.
INTRODUCTION AND SUMMARY
The panel examined the ca
for the purpose of examinin.
tional context have been afl
specific place. The objective
attention to the localized din
Much of the attention g
estimates and national need:
impacts and the responses i
responses are shaped by th'
specific communities. The '
the panel's major findings ai
institutions and their manage:
disease in New York City O'
nomic and ethnic deprivation
ing high levels of morbidity ;
preview of the future of the t
TI
It is instructive to revie
incidence and prevalence to ;
rent uncertainty regarding the
specific population groups,
tive seroprevalence surveys, :
must be inferred from the rep
t result from infections acqi
time. Suppose that the incub.
AIDS is denoted by 1(d) and
t is denoted by H(t). Then th
given by the equation
MO
where (D is the maximum im
appear complicated to those
underlying it is quite simple:
year, for example, is the sui
times the fraction of infection
number of new infections 2 ;
are manifested in AIDS 2 yea
What one observes, of coi
�AL IMPACT OF AIDS IS THE U.S.
out public health needs and
hts of children as they may
issues involved in caring for
inical trials of experimental
.rguments over the rights of
jarents or the state. In both
ieen no fundamental changes
1 care and social services in
parents—regardless of their
ir children—have rarely been
their children.
2 legal recognition of unmarears, but those changes were
;gan, and it is impossible to
td in bringing them about. In
ce WP* enacted in 1990, after
th
epidemic—and the
iai.
nunity in its wake—
ork, changes in the definition
. similarly, probably in part a
iter on economically and soincreasingly affected. Bom
•ecial care and attention from
r children's births, and many
id health reasons, to care for
blems are already noticeable,
hallenges. Still, those efforts
anomalies in family policies
c becomes more endemic in
of gay men. Such men have
es that favored heterosexual
: often deprived of insurance,
^hts and protections accorded
i often are joined in enduring
: provide support and care to
cial and legal recognition of
ie HIV/AIDS epidemic, was
:ions about appropriate legal
inue to be raised at least as
19
IMRODUCTIOS AND SUMMARY
New York City
The panel examined the case of New York City—recognizing its atypicality—
for the purpose of examining how the institutions we examined in the national context have been affected by and responded to the epidemic in a
specific place. The objective was to improve understanding as well as call
attention to the localized dimensions of the HIV/AIDS epidemic.
Much of the attention given to the epidemic has focused on national
estimates and national needs. Ultimately, however, the epidemic and its
impacts and the responses to it are experienced in specific locales, and
responses are shaped by the resources, traditions, and leadership of the
specific communities. The New York City study makes particularly clear
the panel's major findings and conclusions in the context of specific local
institutions and their management of issues presented by the epidemic. HIV
disease in New York City occurs increasingly in the context of socioeconomic and ethnic deprivation, as well as among populations already suffering high levels of morbidity and mortality. The panel believes that this is a
preview of the future of the epidemic in the country as a whole.
TECHNICAL NOTE
It is instructive to review briefly the procedures for estimating HIV
incidence and prevalence to gain an understanding of the basis for the current uncertainty regarding the size of the epidemic and its prevalence among
specific population groups. Given that there are no nationally representative seroprevalence surveys, the incidence and prevalence of HIV infection
must be inferred from the reported cases of AIDS. New AIDS cases at time
/ result from infections acquired over a considerable period before that
time. Suppose that the incubation distribution of duration from infection to
AIDS is denoted by 1(d) and that the number of new HIV infections at time
i is denoted by //(/). Then the number of new AIDS cases at time /, A(r), is
given by the equation
i
lit
0
A(t) = \ ' H ( t - d ) x l ( d ) d d
(1)
Jo
where o is the maximum incubation period. Although this equation may
o
appear complicated to those without training in mathematics, the concept
underlying it is quite simple: the number of new AIDS cases in the current
year, for example, is the sum of the number of new infections last year
times the fraction of infections that are manifested in AIDS 1 year later, the
number of new infections 2 years ago times the fraction of infections that
are manifested in AIDS 2 years later, and so forth.
What one observes, of course, is only the time series A(t). One needs to
it
4
�20
ISTRODUCTION AND SUMMARY
THE SOCIAL IMPACT OF AIDS IN THE U.S.
in the estimates of HIV incid
trol. 1990):
invert the equation to estimate H(t), the time series of new infections. It is
well known that without knowledge of 1(d)—the fraction of infections that
progress to AIDS at each duration d since infection—there is no unique
solution for H(t); in fact, there are infinitely many combinations of H(t) and
/(/) that satisfy equation (1). Therefore, to make progress, one must obtain
external knowledge of 1(d). Estimates of the incubation distribution can be
derived only from individuals whose date of infection is known. The most
reliable data come from cohort studies of hemophiliacs and homosexual
men (Brookmeyer, 1991). Note that these data provide information only on
the waiting time from seroconversion to AIDS. The time from infection to
seroconversion is assumed to be from 3 to 6 months, although seroconversion
in some individuals is apparently much longer. The result is that if 1(d) is
taken from these studies, then the resulting estimates of H(t) pertain to
seroconversions, not infections. In any event, one clear source of uncertainty in the estimates of H(t) is the degree to which the 1(d) distribution
obtained from either of these sources is applicable to the larger population
of infected persons.
Assume that 1(d) is known. A very simple model will illustrate both
the principles and the problems involved in recovering H(t) through a procedure known as back-projection. Suppose it is known that of all HIV
infections acquired in year /, 20 percent will progress to AIDS in year t+2,
30 percent in year /-t-3, and 50 percent in year /+4. Suppose that 1980 is the
first year in which AIDS cases appear. It follows that these can have
resulted only from infections in 1978, since if there had been infections in
1977, there would have been AIDS cases in 1979. Suppose that one observes 100 AIDS cases in 1980, 400 in 1981, and 1,000 in 1982. One can
then solve the following three equations for the three unknowns.
100 = A = .2H ,
400 = A = .2H + .3H and
1,000 =A = .2H + .3// V5//
m
n
sl
i2
(1) Estimates of new H
likely to be accurate than est
(2) It is likely that the
lime as new therapies have t
tive but are asymptomatic. !
infection at which infected p
lid). Furthermore, there is u
obtained from cohort studie:
rately refiect the 1(d) distribu
(3) The time series of Cl
of new AIDS cases, for two r
been expanded twice (in 198.'
cases is exaggerated. Second
the time a case is reported to
of diagnosed cases that are i
the past to the present. Son
garded as cases with infinite
its surveillance system identifl
and that it therefore provides
mortality (Centers for Diseas
must first be corrected for tht
ing delays before they can b
over time, imparting further u
1990).
19
n
79
i0
(2)
Arras. J.D. (1988) The fragile web
Center Report 8(Suppl.): 10-20.
Brandt. A.M. (1988) AIDS and mc
Sncial Research 55:413-432.
Brookmeyer. R. (1991) Reconstriuct
Siaies. Science 253:37-42.
Campbell. A.M. (1931) The Blad
University Press.
Centers for Disease Control (CDC) (
United States: report based t
39:(RR-16):1-31.
Centers for Disease Control (CDC)
United States. 1981-1990. Mot
Centers for Disease Control (CDCi
Centers for Disease Control.
7g
to obtain H = 500, H = 1,250, and H = 1.875. Thus, the prevalence of
HIV infection in 1978 is 500, in 1979 is 1,750 (500 + 1,250) (minus any
who have died of AIDS), and in 1980 15 3,625 (500+ 1,250+ 1,875) (minus
any who have died of AIDS). Note that even at the end of 1982, one cannot
obtain any estimate of the number of new infections in 1981 or 1982 since
there is at least a 2-year delay between infection and AIDS. In order to get
an estimate of / / and H before the end of 1984, one must forecast A
and A by extrapolating the prior *:me series of new AIDS cases or directly
forecast / / and H by extrapolating the estimated prior time series of new
HIV infections.
This simple model can be used to identify three sources of uncertainty
n
i g
g l
t Q
i 2
t i
M
81
......
S 2
-. •
... • ,. .
.
- - ^
-
J
:i.:.\t\-'-*
".
�SOCIAL IMPACT OF AIDS IS THE U.S.
Tie scries of new infections. It is
/)—the fraction of infections that
zt infection—there is no unique
y many combinations of H(t) and
) make progress, one must obtain
he incubation distribution can be
of infection is known. The most
f hemophiliacs and homosexual
data provide information only on
IDS. The time from infection to
months, although seroconversion
iger. The result is that if /(</) is
ng estimates of H(t) pertain to
vent, one clear source of uncer;e to which the 1(d) distribution
plicable to the larger population
imple model will illustrate both
i recovering H(t) through a prose
'tnown that of all HIV
II ,
is to AIDS in year t+2,
ar f+H. Suppose that 1980 is the
It follows that these can have
; if there had been infections in
in 1979. Suppose that one ob1, and 1,000 in 1982. One can
the three unknowns.
(2)
1%
79
in the estimates of HIV incidence and prevalence (Centers for Disease Control, 1990):
(1) Estimates of new HIV infections for very recent periods are less
likely to be accurate than estimates for the more distant past.
(2) It is likely that the incubation distribution 1(d) has changed over
time as new therapies have been introduced for people who are HIV positive but are asymptomatic. In addition, changes over time in the stage of
infection at which infected peole are diagnosed would include changes in
lid). Furthermore, there is uncertainty about whether the 1(d) distributions
obtained from cohort studies of homosexual men or hemophiliacs accurately reflect the 1(d) distribution for all infected people.
(3) The time series of CDC counts of AIDS cases is not the time series
of new AIDS cases, for two reasons. First, the case definition of AIDS has
been expanded twice (in 1985 and 1987); consequently, the growth in AIDS
cases is exaggerated. Second, there are delays from the time of diagnosis to
the time a case is reported to the CDC. These delays would result in counts
of diagnosed cases that are increasingly less complete as one moves from
the past to the present. Some cases are never reported; these can be regarded as cases with infinite delays in reporting. The CDC estimates that
its surveillance system identifies 70-90 percent of HIV-infection-related deaths
and that it therefore provides a minimum estimate of HIV-infection-related
mortality (Centers for Disease Control, 1991). Consequently, CDC counts
must first be corrected for the changes in the case definition and for reporting delays before they can be used. Reporting delays may have changed
over time, imparting further uncertainty into the corrected series, A (Harris,
1990).
1
REFERENCES
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ISTRODUCTION AND SUMMARY
+
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H
n
1,875. Thus, the prevalence of
.750 (500 + 1,250) (minus any
5 (500+ 1,250+ 1,875) (minus
i at the end of 1982, one cannot
ifections in 1981 or 1982 since
tion and AIDS. In order to get
)f 1984, one must forecast
of new AIDS cases or directly
imated prior time series of new
fy three sources of uncertainty
Arras. J.D. (1988) The fragile web of responsibility: AIDS and the duty to treat. Hastings
Center Report 8(Suppl.): 10-20.
Brandt, A.M. (1988) AIDS and metaphor: toward the social meaning of epidemic disease.
Social Research 55:413-432.
Brookmeyer, R. (1991) Reconstriuction and future trends of the AIDS epidemic in the United
States. Science 253:37-42.
Campbell. A.M. (1931) The Black Death and Men of Learning. New York: Columbia
University Press.
Centers for Disease Control (CDC) (1990) HIV prevalence and AIDS case projections for the
United Stales: report based on a workshop. Morbidity and Mortality Weekly Report
39:(RR-16):1-31.
Centers for Disease Control (CDC) (1991) Mortality attributable to HIV infection/AIDS—
United States, 1981-1990. Morbidiry and Mortality Weekly Report 40-.41-46.
Centers for Disease Control (CDC) (1992) HIVIAIDS Surveillance Report. Atlanta, Ga.:
Centers for Disease Control.
�22
THE SOCIAL IMPACT OF AIDS /N THE U.S.
Crosby, A W. (1989) Epidemic and Peace. 1918: America's Forgotten Pandemic. New
York: Cambridge University Press.
Fee, E., and D. Fox (1988) AIDS The Burdens of History. Berkeley, Calif.: University of
Califomia Press.
Foege, W.H. (1988) Plagues: perceptions of risk and social responses. Socio/ Research
55:331-342.
Grmek. M.D. (1990) The History of AIDS: Emergence and Origin of a Modern Pandemic.
Princeton. N.J.: Princeton University Press.
Harris, J. (1990) Reponing delays and the incidence of AIDS. Journal of the American
Statistical Association 85:915-924.
McNeil. W.H. (1976) Plagues and Peoples. New York: Doubleday.
Miller. H.G., C.F. Turner, and L E. Moses, eds. (1990) AIDS: The Second Decade. Committee on AIDS Research and the Behavioral, Social, and Statistical Sciences, Commission
on Behavior and Social Sciences and Education, National Research Council. Washington, D.C: National Academy Press.
Nelkin, D., D.P. Willis, and S.V. Parris (1991) Introduction. In D. Nelkin. D P. Willis, and
S.V. Parris, eds., A Disease of Society : Cultural Responses to AIDS. New York: Cambridge University Press.
Risse, G.B. (1988) Epidemics and history: ecological perspectives and social responses. In E.
Fee and D.M. Fox, eds., AIDS: The Burdens of History. Berkeley, Calif.: University of
Califomia Press.
Slack, P. (1988) Responses to plague in early modem Europe: the implications of public
health. Socia/ Research 55:433-453.
Tuchman, B. (1978) A Distant Mirror. The Calamitous Nth Century. New York: Knopf.
Turner, C.F., H.G. Miller, and L.E. Moses, eds. (1989) AIDS: Sexual Behavior and Intravenous Drug Use. Comminee on AIDS Research and the Behavioral, Social, and Statistical Sciences, Commission on Behavioral and Social Sciences and Education, National
Research Council. Washington. D.C: National Academy Press.
Wallace, R. (1988) A synergism of plagues: "planned shrinkage," contagious housing destruction and AIDS in the Bronx. Environmental Research 47:1-33.
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Health Care Reform
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2006-0810-F
Description
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<p>This collection consists of records related to Hillary Rodham Clinton's Health Care Reform Files, 1993-1996. First Lady Hillary Rodham Clinton served as the Chair of the President's Task Force on National Health Care Reform. The files contain reports, memoranda, correspondence, schedules, and news clippings. These materials discuss topics such as the proposed health care plan, the need for health care reform, benefits packages, Medicare, Medicaid, events in support of the Administration's plan, and other health care reform proposals. Furthermore, this material includes draft reports from the White House Health Care Interdepartmental Working Group, formed to advise the Health Care Task Force on the reform plan.</p>
<p>This collection is divided into two seperate segments. Click here for records from:<br /><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0810-F+Segment+1"><strong>Segment One</strong></a> <br /><a href="http://clinton.presidentiallibraries.us/items/browse?advanced%5B0%5D%5Belement_id%5D=43&advanced%5B0%5D%5Btype%5D=is+exactly&advanced%5B0%5D%5Bterms%5D=2006-0810-F+Segment+2"><strong>Segment Two</strong></a></p>
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Clinton Presidential Records
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William J. Clinton Presidential Library & Museum
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Briefing Book on AIDS [3]
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Health Care Task Force
General Files
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2006-0810-F Segment 1
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Box 53
<a href="http://clinton.presidentiallibraries.us/items/show/36144" target="_blank">Collection Finding Aid</a>
<a href="https://catalog.archives.gov/id/12090749" target="_blank">National Archives Catalog Description</a>
Provenance
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Clinton Presidential Records: White House Staff and Office Files
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William J. Clinton Presidential Library & Museum
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Adobe Acrobat Document
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Preservation-Reproduction-Reference
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5/5/2015
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42-t-2194630-20060810F-Seg1-053-007-2015
12090749