The National Journal’s Margot Sanger-Katz and Meghan McCarthy have an interesting piece examining how the GOP presidential candidates obtain health insurance coverage, given their support for repealing the Affordable Care Act and pushing individuals and families into the individual market:

– MITT ROMNEY: The Romney campaign refused to say where he gets his health care coverage. But because of the health care reform law he signed as governor of Massachusetts, he is lucky to live in one of the few states with good insurance options for a 64-year-old unemployed man with a wife who has a preexisting health condition: multiple sclerosis.

– RICK SANTORUM: The 53-year-old former senator from Pennsylvania is enrolled in insurance that “is totally private, and not related to his time in Congress,” his spokesman, John Brabender, said in a phone interview. And if Republicans succeed in their stated goal of repealing “Obamacare,” Santorum likely won’t be firing his insurer any time soon, since his daughter suffers from a pre-existing condition.

– NEWT GINGRICH: Gingrich, 68, is enrolled in Medicare and buys his own supplemental insurance from Blue Cross Blue Shield, according to his campaign.

– RON PAUL: Paul, 76, as a member of Congress, gets his insurance coverage from the federal-employee benefit program, his campaign says.

– RICK PERRY: Perry, 61, gets his insurance from the state of Texas, a benefit he can continue to receive for the rest of his life. (According to the Texas Tribune, Perry is already collecting a state pension, even while he earns his salary as governor.)

These men are insured in large-group policies that don’t discriminate against pre-existing conditions and spread the risks and costs of insurance among a pool of healthy and sick applicants who can use the advantages of their size to negotiate better rates with medical providers. (It’s unclear if Santorum actually has an individual policy or a group plan through his campaign or think tank affiliation.)

Their campaign proposals, however, would encourage individual Americans to face down health insurance companies on their own and seek out affordable rates in an unregulated national market where companies can sell policies that don’t comply with state consumer protections and offer little reliability. Insurers have an incentive to enroll the healthiest beneficiaries and avoid or price out older applicants, so that the GOP candidates and many millions of Americans who suffer from pre-existing conditions, would have a hard time finding affordable insurance if they don’t have an alternative offer of employer coverage. In that case, they could (under the Republican proposals) end up uninsured or in a state-based high-risk insurance pool, where the enrollees’ older and sicker risk profile leads to higher premiums and out-of-pocket spending. Those are costs that this particular set of wealthy candidates could surely afford, but many other Americans will struggle with.

Via Politico Pulse, CNN’s Sanjay Gupta ran a telling segment comparing Romneycare to Obamacare last night, in which he asked the former Massachusetts governor how he would encourage healthier people to purchase insurance without a mandate:

GUPTA: Mandate is a seven-letter word, but many people regard it as a four-letter word. Should mandates be a part of reforming health care?

ROMNEY: We’ll you’re not going to put people in jail for not having insurance, of course that’s…

GUPTA: But you could penalize them…

ROMNEY … None is talking about that, but there are various ways to encourage people to get insurance. One is to give everybody a credit — a tax credit that you only get to use if you have insurance.

Watch it:

Romney — who championed the individual requirement in Massachusetts as a way to lower the state’s spending on uncompensated care — didn’t support repealing the ACA’s mandate until the middle of last year and so he appreciates the importance of bringing everyone into the health care system. That’s why what he’s really proposing is a mandate in disguise: using economic incentives to encourage healthier and younger people to purchase insurance before they become sick and shift the costs of their care throughout the health care system. Only under his plan, people who forgo coverage would essentially be penalized by not receiving a tax credit.

It’s the same concept as the Affordable Care Act, only worse. The Congressional Budget Office (CBO) estimates that eliminating the current mandate structure — which asses a direct penalty on those who don’t purchase insurance — would reduce coverage by 16 million people and even generous tax credits –- which likely go beyond what’s included in the Romney’s plan — would cover only 40 to 50 percent of the uninsured. They would also fail to grow with rising costs and wouldn’t be accompanies by the regulatory protections of the ACA, which allow the millions of Americans with pre-existing conditions to find affordable coverage. But this at least demonstrates that Romney appreciates the importance of a mandate-type approach, no matter how much he’d like to deny it.

Rick Santorum reiterated his opposition to Medicare during a town hall in South Carolina Thursday morning, saying, “we should not have a government-run health care system on Medicare or anything else, because it completely distorts the market. It’s top down. It’s not the way America works best.” Santorum made the remarks in the context of his support for Sen. Ron Wyden’s (D-OR) and Rep. Paul Ryan’s (R-WI) “premium support” proposal. Watch it:

Santorum is a strong supporter of Ryan’s original Medicare privatization scheme to completely eliminate traditional Medicare as an option for seniors and has promised to accelerate its implementation. Medicare, however, has a better track record of controlling health care costs than private insurers and has introduced market innovations and payment reforms that private plans later adopted.

A study published today in the New England Journal of Medicine finds that a growing number of health insurers are trying to recruit younger and healthier beneficiaries into their Medicare Advantage programs by offering fitness club memberships:

The study found 35.3 percent of new enrollees in a fitness membership benefit plan reported “excellent” or “very good” health, compared with 29.1 percent in the group without the benefit. The number of plans offering the memberships rose to 58 in 2008 from 4 in 2002, the researchers said.

The five largest insurers are looking to expand their roles in offering government-subsidized health plans as the number of Americans covered by them grows under the 2010 U.S. health law. In doing so, the companies may try to “cherry pick” members who are more likely to be healthy using the fitness memberships, said Amal Trivedi, an assistant professor of community health at Brown University in Providence, Rhode Island, and the author of the report released yesterday.

Gym memberships are certainly a good preventive benefit for some beneficiaries, but as Trivedi points out, they also allows insurers to skim the cream off the top and attract the healthiest and most profitable risk pool, leaving older and sicker seniors in traditional Medicare. That is precisely the problem with the GOP’s (and Ron Wyden’s) Medicare premium support proposals. It is very difficult, from a policy standpoint, to counteract private insurers’ market-driven desire to maximize returns (by trying to keep out sick and expensive applicants) with existing risk adjustment mechanisms. They are clearly less than fully effective in preventing cherry picking and any Medicare proposal that does not level the playing field by requiring companies to offer standardized benefits and preventing too much variation is asking for a serious adverse selection problem.

While half of the population spends little or nothing on health care, 5 percent of the sickest Americans account for almost half of total costs. Yesterday, a new study from Agency for Healthcare Research and Quality found that just 1 percent of Americans were responsible for a whopping 22 percent of health care costs in 2009 or about $90,000 per person:

While the report showed how a tiny segment of the population can drive health care spending, the findings included good news. In 1996, the top 1% of the population accounted for 28% of health care spending.

“The actual concentration has dropped,” Cohen said. “That’s a big change.”

About one in five health care consumers remained in the top 1% of spenders for at least two consecutive years, the report showed. They tended to be white, non-Hispanic women in poor health; the elderly; and users of publicly funded health care.

The news highlights the importance of encouraging providers to manage chronic conditions more efficiently — something the Affordable Care Act already invests in — but also suggests that health care reforms that try to give people more “skin in the game” by creating greater competition in the health care market can only have limited effect on spending. Those policies are targeted towards healthier applicants who have the luxury of choice in the individual health insurance market and don’t address the needs of the most expensive beneficiaries or the real source of costs in the health care system.