This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.
‘Sorry for your loss — here’s your bill’
By Robert Remington
Calgary Herald, January 20, 2012
With the family of deceased Canadian skier Sarah Burke facing a U.S. medical bill topping the value of an average Calgary home, I was reminded Friday of a quote by the late Justice Emmett Hall, a crusader for Canada’s public health-care system.
“We as a society are aware that the trauma of illness, the pain of surgery, the slow decline to death are burdens enough for the human being to bear without the added burden of medical or hospital bills penalizing the patient at the moment of vulnerability,” Hall wrote in a 1979 review of publicly funded health insurance.
To help Burke’s husband Rory Bushfield pay an expected $550,000 medical bill for nine days of intensive care in Utah, a website was set up by Burke’s agent asking for donations. The site had reached nearly $200,000 as of this writing Friday afternoon, prompting the Canadian Freestyle Ski Association to announce that the amount was enough that her family “will not have any financial burden related to her care.”
The association’s statement seemed odd, considering that the website was $350,000 short of its intended goal, but not if you understand the vagaries of a private health system dominated by big private insurers.
In the U.S. health system, “nobody pays the sticker price, except for those who are squeezed, which is normally the uninsured,” says Steve Morgan, a health policy analyst with the University of British Columbia’s Centre for Health Services and Policy Research.
“Big insurance doesn’t pay retail,” Morgan says of the U.S. health system. Typically, he says a hospital will present a bill big enough to choke a horse and the insurance company will negotiate it down. Individuals without insurance, or those who are under-insured, have little or no negotiating power and often end up paying bills that are financially devastating, Morgan said.
Burke was apparently not adequately insured in the U.S. Her ski association only covers sanctioned events. Because the event at which she was injured and subsequently died was an unsanctioned competition put on by her sponsor, Monster Energy Company, the ski association’s insurance did not cover her.
It was not clear if Burke’s family thought she was adequately covered, or if Monster had insurance for her. The company did not say if it would help cover her medical bills, which Morgan says is not surprising.
Monster, he said, could have negotiated behind the scenes to get the price down. The Canadian Freestyle Ski Association said the family had not yet received a final bill for her hospitalization, but that it is expected to be approximately $200,000, roughly the amount that had already been collected.
Morgan says Burke’s case should be a sobering reminder to Canadians of what could happen in a privately-insured market, rather than a public system where everyone is insured against a catastrophic event.
In 2000, the U.S. health policy journal Health Affairs wrote about the issue under the heading “Gouging the Medically Uninsured: A Tale of Two Bills.”
“Overcharging the uninsured is one of the many unintended and largely overlooked results of our decade-long obsession with curbing health-care costs,” it said. “Powerful interest groups — government, employers, insurers, hospitals, medical equipment vendors, and health care professionals — have fought vigorously to protect their interests. The uninsured, with no organized voice, emerge as losers.”
Since 2001, family health insurance premiums in the U.S. have increased 113 per cent, according to the Kaiser Family Foundation, with annual premiums for employer-sponsored family health coverage growing to $15,073 in 2011. Due to the economic downturn, the number of Americans going without insurance has grown by one million to 49.9 million people.
We complain of health-care costs and outcomes in Canada, but the U.S. ranks behind Australia, Canada, Germany, the Netherlands, New Zealand and the U.K. in five areas of health system performance: quality, efficiency, access to care, equity and mortality, according to a report by the Commonwealth Fund.
“Our failure as a country to ensure basic health care for all of its citizens is in part to blame,” Glenn D. Braunstein, chairman of the Department of Medicine at Cedars-Sinai Medical Center in Los Angeles, wrote Friday in the Huffington Post.
It is, indeed, a sobering reminder to Canadians how lucky we are. As one commentator wrote of the Burke family’s experience with the U.S. system: “We are sorry for your loss. Here’s your bill.”
Instead of commenting on the cruel and inhumane health care financing system we have in the United States, let’s remember Sarah by spending a moment with her:
This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.
Is U.S. Health Spending Finally Under Control?
By Uwe E. Reinhardt
The New York Times, January 20, 2012
“Growth in U.S. health spending remains slow in 2010” was the headline of a news release on Jan. 9 by the Centers for Medicare and Medicaid Services, part of the Department of Health and Human Services. At an increase of 3.9 percent over national health spending in 2009, “the rates of health spending growth in 2009 and 2010 marked the lowest rate in the 51-year history of the National Health Expenditure Accounts,” the release said.
The $64,000 question is how soon the excess growth of health spending will descend from its historical average of 1.5 to 2.5 percent first to, say, 1 percent or so, and eventually to 0 percent.
It is tempting to view the relatively lower cost growth in recent years as a first step in that direction. But nothing in the history of health spending in the United States suggests that this is the time to break out the Champagne to celebrate that victory.
After all, low rates of spending increases in 2009-10 could just be the lagged effect of the deep recession in 2008-9. There is evidence in the literature that health spending does not completely march to its own drummer, regardless of what happens in the rest of the economy, but instead tends to rise and fall somewhat with the rest of the G.D.P., albeit with a lag of one to two years. The safest bet is that on the long road to eventual zero excess growth in health spending, we will ride up and down quite a few more times on the health-spending roller coaster.
Now why is it reasonable to assume that excess cost growth will just have to decline to zero in the long run – that is, to assume that health spending will not eventually grow faster than G.D.P. and perhaps even more slowly?
Economists would explain such a trend as follows: as the fraction of G.D.P. devoted to health care increases, the added satisfaction, or utility, that people derive from added health care is likely to diminish relative to the added satisfaction derived from consuming more of other things. It could explain a gradual decline in the excess growth of health care spending.
Finally, economists retreat here to the one law on which they all agree, namely, Stein’s Law, named for the late economist Herbert Stein: “If something cannot go on forever, it will stop.” Trust us. It will, in the long run.
San Juan Capistrano, CA
How close we already are to meeting the limits of Stein’s Law is exemplified by 1) the current cost of health care for a family of four with an employer-sponsored PPO – $19,393 (Milliman), and 2) median household income – $49,445 (2010).
Although these are not measures of identical family units, they do provide enough of a perspective to show that we have run out of space in family budgets to pay for health care. The forgoing of wages to pay for employer-sponsored health benefits has crimped family budgets to the extent that frugality has become, by necessity, the norm.
We can continue as we are, allowing personal hardship to increase, or we can have our public stewards take control, as they have in other nations. They have been successful in ensuring that everyone has health care at costs averaging only half of those in the U.S.
A properly designed Medicare for all would work just fine for all of us.
This entry is from Dr. McCanne's Quote of the Day, a daily health policy update on the single-payer health care reform movement. The QotD is archived on PNHP's website.
Lessons from Medicare’s Demonstration Projects on Disease Management, Care Coordination, and Value-Based Payment
Congressional Budget Office
In the past two decades, CMS has conducted two broad categories of demonstrations aimed at enhancing the quality of health care and improving the efficiency of health care delivery in Medicare’s fee-for-service program.
* Disease management and care coordination demonstrations have sought to improve the quality of care of beneficiaries with chronic illnesses and those whose health care is expected to be particularly costly.
* Value-based payment demonstrations have given health care providers financial incentives to improve the quality and efficiency of care rather than payments based strictly on the volume and intensity of services delivered.
The evaluations show that most programs have not reduced Medicare spending: In nearly every program involving disease management and care coordination, spending was either unchanged or increased relative to the spending that would have occurred in the absence of the program, when the fees paid to the participating organizations were considered. Programs in which care managers had substantial direct interaction with physicians and significant in-person interaction with patients were more likely to reduce Medicare spending than other programs, but on average even those programs did not achieve enough savings to offset their fees.
Results from demonstrations of value-based payment systems were mixed. In one of the four demonstrations examined, Medicare made bundled payments that covered all hospital and physician services for heart bypass surgeries; Medicare’s spending for those services was reduced by about 10 percent under the demonstration. Other demonstrations of value-based payment appear to have produced little or no savings for Medicare.
The results of those Medicare demonstrations suggest that substantial changes to payment and delivery systems will probably be necessary for programs involving disease management and care coordination or value-based payment to significantly reduce spending and either maintain or improve the quality of care provided to patients.
Recognizing the need to slow the increase in health care spending, much hope has been placed on disease management, care coordination, and value-based payments such as pay-for-performance. Medicare has authorized numerous demonstration projects to prove that these programs are effective. They aren’t.
The results of these demonstrations have shown that they have not reduced spending because the costs of the interventions were not offset by the savings, and frequently the costs were greater, resulting in a net loss.
The one exception in the report – bundled payments – doesn’t really belong in this list anyway. The demonstration study negotiated a single fee for coronary bypass surgeries, covering both the hospitals and the in-hospital treating physicians. The negotiated fee was about 10 percent less than the itemized fees had been previously. Thus the savings for Medicare was about 10 percent for these bypass surgeries. There was no attempt to determine if this reduction resulted in efforts to recover the difference from other patients or payers, which makes it difficult to know whether or not bundling actually reduced total health care costs.
On the other hand, imagine a system in which all payments are negotiated, as with a single payer system. Hospitals negotiate an annual global budget. That budget includes their costs of services, such as coronary bypass surgeries, without the need to itemize each single item for the services, nor the need to bundle payments in some sort of pretense that global costs are reduced. The hospital already has incentives to improve efficiencies to stay within budget.
Likewise, physicians collectively negotiate their payments, whether fee-for-service, capitation, or salary, as appropriate to their clinical circumstances. Payments are adequate to ensure a very comfortable net income.
Other nations have proven that negotiated, administered payment is effective in obtaining greater value for health care spending. We’ve now proven that intrusion of market-model games players such as outside disease managers, or pay-for-performance administrators, have failed to improve value. So we should go with a system that really does work – a single payer national health program.
Act 48 Integration Report: Green Mountain Care
Submitted by Robin J. Lunge, Director of Health Care Reform
Department of Vermont Health Access and the
Department of Banking, Insurance, Securities, and Health Care Administration
January 17, 2012
Act 48 creates Green Mountain Care, which is a publicly financed health care program delivering affordable, high-quality health care coverage to all residents of Vermont. Section 8 of No. 48 of the acts of 2011 (Act 48) calls for a report consisting of a series of studies to inform the development of Green Mountain Care.
The administrative integration of many payers will begin in the Exchange. For example, individuals eligible for Medicaid may use a web-based portal designed for the Exchange to enroll in Medicaid. The Exchange will also integrate the small group and association markets and could additionally integrate the individual market as well. Municipal employees are currently in the small group market, so their coverage would also be integrated in the Exchange.
The three payers who may not be able to be integrated into the Exchange are Medicare, state employees, and school employees.
Medicare is a federal program, paid for with all federal funds and administered entirely by the federal government. 33 V.S.A. 1824 provides that the agency of human services shall collect information to determine if an individual is eligible for Medicare in order to ensure that federal funds are utilized before state funds. Act 48 specifically provides that Green Mountain Care will not alter anyone’s Medicare benefits under Medicare. If an individual is enrolled in Medicare, he or she need not apply for or enroll in Green Mountain Care if he or she does not wish to. Act 48 allows the individual the choice to have Green Mountain Care as a secondary insurance, but does not require it. The cost of these provisions will be looked at as part of the financing study due in January 2013.
Medicare Waiver Demonstration Application
Center for Medicare & Medicaid Services
CMS conducts Medicare-waiver-only demonstrations to test innovations that have been shown to be successful in improving access and quality and/or lowering health care costs. These demonstrations may involve new benefits, fee-for-service or Medicare Advantage payment methodologies, and/or risk sharing arrangements that are not currently permitted under Medicare statute.
For more about Medicare waivers:
Legal Information Institute
Converting Successful Medicare Demonstrations into National Programs (an excellent description of the limitations of the process using the example of P4P):
As states attempt to set up single payer programs, one problem that comes up is how do you move federal funds from programs such as Medicare into the state single payer system? The simple answer is, you don’t, at least not without getting Congress to enact transformative legislation.
Many have suggested that all you need is a “Medicare waiver.” But the Medicare waiver process is limited to small demonstrations primarily of payment innovations that are budget neutral or less, and that do not reduce benefits. They do not allow changes in the fundamentals of the Medicare program. The populations covered remain the same.
Vermont dropped “single payer” from the title of their legislation. One of the reasons is that Medicare will have to remain a separate program, even though they are making efforts to allow Green Mountain Care to serve as an additional Medigap plan, and to allow for some administrative integration within the insurance exchange.
Vermont should certainly move forward with its process, since beneficial tweaks are better than nothing at all. But the real message is that Vermont, and all of us, could have so much more if we enacted a national single payer health program.
We should not wait to see how well the state efforts and the implementation of the Affordable Care Act will work. We already know. Costs will be higher. Millions will remain uninsured. Underinsurance will be the new standard. Hardship and suffering will increase.
States should try to improve their programs while they are waiting for national reform. But it’s our job to see that they don’t have to wait any longer than they have to. We must act now.
After urologists got machine, cancer treatments soared
By Jay Hancock
The Baltimore Sun, January 17, 2012
Four years ago, doctors at Chesapeake Urology Associates started ordering the most expensive kind of prostate-cancer therapy for many more of their patients.
Before 2007, the large, multi-office practice was prescribing the treatment, known as intensity modulated radiation therapy, for 12 percent of its prostate-cancer patients covered by Medicare, according to data compiled by a Georgetown University researcher. But starting in mid-2007, Chesapeake Urology’s referral rate for IMRT more than tripled, rising to 43 percent of the Medicare cases.
What could have caused such a sharp change?
It couldn’t have been because IMRT, which costs about $40,000 per treatment, was new. Maryland hospitals had been offering it for years.
It couldn’t have been because IMRT was better.
“No randomized clinical trials show that prostate cancer patients receiving IMRT live longer or experience fewer long-term side effects than those getting the alternatives” of radiation-seed therapy or surgery, said Dr. James Mohler, a urologist at Roswell Park Cancer Institute in Buffalo, N.Y., and chairman of the national committee that sets standards for prostate-cancer care.
Chesapeake Urology tripled its percentage of prescriptions for IMRT after the practice acquired its own IMRT machine in 2007. The more patients the Baltimore-area urologists referred for that expensive therapy alternative, the more revenue and profits they would generate.
“They’re steering patients to IMRT because that’s where they make their money,” said Jean Mitchell, a professor and health care economist at Georgetown who’s working on a national study about IMRT referrals. “They’re making a ton of money out of this. There’s no question about it. At the expense of the taxpayers” who finance Medicare.
Technology that improves patient outcomes and reduces costs is great. Technology that increases costs, produces undesirable side effects, and provides no evidence of extended life expectancy is… well… not so great, except for meeting the financial goals of the entrepreneurial owners of the technology. And when the owners of the technology are the same trusted physicians who are prescribing it, that’s reprehensible.
Theoretically a government-funded and government-administered health care financing program would have the power to prevent these abuses. Yet this diversion of radiation treatment fees to the referring physicians is occurring within the Medicare program. So simply expanding Medicare to everyone alone is not enough to fix our dysfunctional financing system.
A properly designed single payer national health program would do far more than simply remove private insurers from the system. In this instance the need for the radiation equipment would be determined by medical science confirming the value of the intervention. The decision to purchase the equipment would be made through regional planning based on need. The payment for the equipment would be through separate budgeting of capital improvements. The ownership would be public or non-profit and would have no investors to draw off profits.
Physicians would be paid appropriately for their professional services as urologists and radiation oncologists, but they would not receive extra dividends based on their insight as to the potential lucrative benefits of personally investing in the equipment.
So about that Medicare for all. We speak of an improved Medicare for all, but the improvements would have to be monumental.
“Of all the forms of inequality, injustice in health care is the most shocking and inhumane”
–Martin Luther King Jr.
Among the Wealthiest One Percent, Many Variations
By Shaila Dewan and Robert Gebeloff
The New York Times, January 14, 2012
The colossal gap between the very rich and everyone else – the 1 percent versus the 99 percent – has become a rallying point in this election season. President Obama positions himself as a defender of the middle class, and Mitt Romney, the wealthiest of the Republican presidential candidates, decries such talk as “the bitter politics of envy.”
The range of wealth in the 1 percent is vast – from households that bring in $380,000 a year, according to census data, up to billionaires like Warren E. Buffett and Bill Gates.
Most 1 percenters were born with socioeconomic advantages, which helps explain why the 1 percent is more likely than other Americans to have jobs, according to census data. They work longer hours, being three times more likely than the 99 percent to work more than 50 hours a week, and are more likely to be self-employed.
In one survey of wealthy Chicago families, almost twice as many respondents said they would cut government spending as those who said they would cut spending and raise revenue.
“I don’t mind paying a little bit more in taxes. I don’t mind putting money to programs that help the poor,” said Anthony J. Bonomo of Manhasset, N.Y., who runs a medical malpractice insurance company and is a Republican. But, he said, he did mind taking a hit for the country’s woes. “If those people could camp out in that park all day, why aren’t they out looking for a job? Why are they blaming others?”
Still, David Mejias, a divorce and personal injury lawyer who once served as a Democratic legislator for Nassau County, said that the system everywhere was skewed in favor of the self-employed and business owners who could deduct part of the cost of their cars, trips, dinners and even collectibles like art.
“Not only do we make more money, but if you do a lifestyle analysis, we make a lot more money,” he said. “Before we even get paid, most of our life has been paid for already.”
“I definitely see it around me,” said Anu Chandok, 36, an oncologist in Lake Success, referring to the country’s economic pain. “It just personally hasn’t affected me yet.”
Dr. Chandok said that her husband, also a doctor, was still paying off his student loans. The couple has a nanny, but Dr. Chandok’s father-in-law does the shopping and cooking.
Dr. Chandok said she had never heard the Occupy Wall Street slogan “We are the 99 percent.” Two children and 11-hour workdays, she said, do not leave much time for politics.
But when the slogan was explained as a complaint against the wealthy’s growing share of income, she shook her head. “I spent four years in undergraduate school, four years in medical school, three years as a resident and three years as a fellow,” she said. “You have to look at the people who are complaining.”
New York Times Interactive
Of 360,785 physicians who practice in offices and clinics, 27.2 percent have incomes in the top 1 percent (over $380,000).
On Martin Luther King Jr Day it seems appropriate to contemplate what he might say about the dramatic increase in flow of wealth from middle- and lower-income families to the 1 percent who constitute the uber-wealthy. It seems safe to assume that he would be concerned about the negative impact on the issues of social justice to which he devoted his life.
One of those issues was health care justice. What do you think he might say about the fact that 27 percent of physicians practicing in offices and clinics fall into the highest 1 percent of income? It is likely that he would not frame the problem narrowly as excess compensation for physicians but rather as the larger issue of an excess accumulation of wealth at the very top when there is so much unmet need amongst the masses.
But for many of us who have had experience in the trenches, we have been annoyed, to say the least, that many of these same high-income physicians refused to see our uninsured and Medicaid patients. Was it because they didn’t want to make the smallest of dents in their high incomes by using a small amount of office time on just a few patients that did not cover their costs? Or was it that they didn’t want “that element” to frequent their waiting rooms? Both, in my experience, and as Dr. Chandok’s views suggest.
One concern that many physicians have about single payer, or an improved Medicare for all, is that the government, as a monopsony, could reduce physicians’ incomes perhaps to the level of teachers’ salaries. Although incomes of physicians in most other nations are lower than in the United States, they still rank well above average. Physicians do very well, though most are not able to accumulate large amounts of wealth that a $380,000 or more income might bring.
Most physicians who are truly dedicated to serving patients would be satisfied with incomes in the top 20 percent if they were provided a practice environment conducive to optimal care for all of their patients. That, of course, is precisely a major goal of single payer.
Many if not most of those physicians who want to be in the top 1 percent might not be satisfied. When deciding on career choices they might reject medicine if it had government controls on spending, and choose an educational path that might lead to the financial services industry, corporate leadership, or entrepreneurial endeavors.
Opponents of government-financed medicine have warned that controls on health care spending might deprive health care of some of the finest and brightest minds. What? Do we really want more physicians whose primary interest is to accumulate wealth while demonstrating absolutely no compassion for the least amongst us? There isn’t much doubt about what Dr. King’s position would be.
When we are asked if single payer might reduce physicians’ incomes we don’t need to fumble around trying to craft an answer that would placate physicians with very high incomes. We should state frankly that if an individual’s goal is to have a personal fleet of luxury automobiles and a condo in every climate, then medicine isn’t the field for them, or at least shouldn’t be.
On the other hand, if the goal is to obtain the best attainable health care for everyone, while adjusting incomes to reinforce the primary care infrastructure and to provide fair but not excessive compensation for procedure-oriented specialists, then practicing medicine in a single payer environment is just what the compassionate doctor ordered.
Imaging and Insurance: Do the Uninsured Get Less Imaging in Emergency Departments?
By James W. Moser, PhD, Kimberly E. Applegate, MD, MS
Journal of the American College of Radiology, January 2012
Compared with non-Medicaid insured ED patients, uninsured ED patients were less likely to get any imaging services and to get lower value imaging RVUs (relative value units), results that held for nearly all modalities. Similar results regarding the number and value of imaging services, as well as health status, were found for Medicaid patients.
Even after controlling for health status and other measurable factors, the average number of imaging tests received by uninsured ED patients was ≥8% lower than that for non-Medicaid insured ED patients. The deficit for Medicaid ED patients was even greater, at about 10%. Uninsured ED patients and Medicaid ED patients also received fewer imaging-related RVUs per visit than non-Medicaid insured ED patients: 13% and 19%, respectively. These differences amplify the potentially serious health implications for persons lacking conventional health insurance. As the number of uninsured Americans continues to rise, the use of ED services will also rise.
The differences in imaging RVUs by insurance group stemmed from a bias toward lower valued imaging modalities for persons lacking coverage compared with insurance persons. Medicaid patients, perhaps underinsured, also received lower valued imaging and less imaging compared with insured patients. Other studies have found that the uninsured are less likely to get timely medical care and consequently are sicker upon being admitted to the hospital.
Fully predictable. Uninsured and Medicaid emergency department patients receive fewer imaging tests, and when they do receive them, they are more likely to be lower valued tests. Under the Affordable Care Act, many individuals will remain uninsured and many more will be enrolled in Medicaid. Thus this is a problem that is not going away.
We can do better than this.
Fitness Memberships and Favorable Selection in Medicare Advantage Plans
By Alicia L. Cooper, M.P.H., and Amal N. Trivedi, M.D., M.P.H.
The New England Journal of Medicine, January 12, 2012
This study examined the consequences of adding a fitness-membership benefit on the self-reported health status of enrollees in Medicare Advantage plans. Using a quasi-experimental design, we found that persons enrolling in plans after the addition of a fitness-membership benefit reported significantly better general health, fewer limitations in moderate activities, less difficulty walking, and higher PCS scores than did persons who enrolled in the same plan before the fitness benefit was added and in matched control plans that never offered a fitness benefit. These patterns persisted in the analyses of 2-year follow-up responses for all measures except self-reported general health. Our findings suggest that there is an association between the adoption of fitness-membership benefits in Medicare Advantage plans and the enrollment of healthier Medicare beneficiaries.
Risk-adjusted payments are designed to reduce incentives for plans to avoid high-cost patients. However, the enhanced Medicare risk-adjustment model has the power to explain only 11% of the total variation in health spending. Furthermore, the model overpredicts costs for persons in good health and underpredicts costs for persons in poor health, yielding overpayments for healthy enrollees and underpayments for less-healthy enrollees. Therefore, the continued limitations of the CMS payment model may not discourage Medicare Advantage plans from engaging in risk-selective activities. Our findings are consistent with the notion that Medicare managed-care plans have continued to selectively market their benefits to healthier beneficiaries, even after the improved risk-adjustment program was instituted.
This study further confirms what we have known all along – that private insurers selectively market to the healthy, further cushioning their profits by being paid at rates for those with only average health. Although risk adjustment has been introduced to correct overpayments due to their use of favorable selection, the insurers have found devious ways to use risk adjustment to further expand their profits, even though technically prohibited. It is the nature of private insurers to always work the system to their own advantage, and that will never change.
How many times do we have to say it? It is time to dismiss the private insurers and establish our own single payer national health program in which the benefits accrue to the patients/taxpayers and not to the expensive, intrusive, wasteful insurance intermediaries.
Growth In US Health Spending Remained Slow In 2010; Health Share Of Gross Domestic Product Was Unchanged From 2009
By Anne B. Martin, David Lassman, Benjamin Washington, Aaron Catlin and the National Health Expenditure Accounts Team
Health Affairs, January 2012
Medical goods and services are generally viewed as necessities. Even so, the latest recession had a dramatic effect on their utilization. US health spending grew more slowly in 2009 and 2010—at rates of 3.8 percent and 3.9 percent, respectively—than in any other years during the fifty-one-year history of the National Health Expenditure Accounts. In 2010 extraordinarily slow growth in the use and intensity of services led to slower growth in spending for personal health care. The rates of growth in overall US gross domestic product (GDP) and in health spending began to converge in 2010. As a result, the health spending share of GDP stabilized at 17.9 percent.
Health care spending experienced historically low rates of growth in 2009 and 2010 as the impact of the recent recession continued to affect the purchasers, providers, and sponsors of health care. Persistently high unemployment, continued loss of private health insurance coverage, and increased cost sharing led some people to forgo care or seek less costly alternatives than they would have otherwise used. As a result, growth in the use and intensity of health care goods and services in 2010 accounted for a much smaller share of personal health care spending growth than in previous years. Finally, as businesses, households, and state and local governments financed a smaller share of total national health care spending during and just after the recession, the federal government financed a larger share.
For the present, growth in health care spending has leveled off at 17.9 percent of our GDP. But how? By high unemployment, continued loss of private health insurance, and increased cost sharing – all measures that prevent people from getting the health care that they should have. If you exclude from consideration this inappropriate decline in health care services, then you can only conclude that health care costs have continued their inexorable rise unabated. We desperately need a sane system of financing health care.
What Americans Keep Ignoring About Finland’s School Success
By Anu Partanen
The Atlantic, December 29, 2011
Everyone agrees the United States needs to improve its education system dramatically, but how? One of the hottest trends in education reform lately is looking at the stunning success of the West’s reigning education superpower, Finland. Trouble is, when it comes to the lessons that Finnish schools have to offer, most of the discussion seems to be missing the point.
So there was considerable interest in a recent visit to the U.S. by one of the leading Finnish authorities on education reform, Pasi Sahlberg, director of the Finnish Ministry of Education’s Center for International Mobility and author of the new book Finnish Lessons: What Can the World Learn from Educational Change in Finland? Earlier this month, Sahlberg stopped by the Dwight School in New York City to speak with educators and students, and his visit received national media attention and generated much discussion.
Yet one of the most significant things Sahlberg said passed practically unnoticed. “Oh,” he mentioned at one point, “and there are no private schools in Finland.”
This notion may seem difficult for an American to digest, but it’s true. Only a small number of independent schools exist in Finland, and even they are all publicly financed. None is allowed to charge tuition fees. There are no private universities, either. This means that practically every person in Finland attends public school, whether for pre-K or a Ph.D.
The irony of Sahlberg’s making this comment during a talk at the Dwight School seemed obvious. Like many of America’s best schools, Dwight is a private institution that costs high-school students upward of $35,000 a year to attend — not to mention that Dwight, in particular, is run for profit, an increasing trend in the U.S. Yet no one in the room commented on Sahlberg’s statement. I found this surprising. Sahlberg himself did not.
From his point of view, Americans are consistently obsessed with certain questions: How can you keep track of students’ performance if you don’t test them constantly? How can you improve teaching if you have no accountability for bad teachers or merit pay for good teachers? How do you foster competition and engage the private sector? How do you provide school choice?
The answers Finland provides seem to run counter to just about everything America’s school reformers are trying to do.
For starters, Finland has no standardized tests. The only exception is what’s called the National Matriculation Exam, which everyone takes at the end of a voluntary upper-secondary school, roughly the equivalent of American high school.
As for accountability of teachers and administrators, Sahlberg shrugs. “There’s no word for accountability in Finnish,” he later told an audience at the Teachers College of Columbia University. “Accountability is something that is left when responsibility has been subtracted.”
And while Americans love to talk about competition, Sahlberg points out that nothing makes Finns more uncomfortable. In his book Sahlberg quotes a line from Finnish writer named Samuli Puronen: “Real winners do not compete.” It’s hard to think of a more un-American idea, but when it comes to education, Finland’s success shows that the Finnish attitude might have merits. There are no lists of best schools or teachers in Finland. The main driver of education policy is not competition between teachers and between schools, but cooperation.
Finally, in Finland, school choice is noticeably not a priority, nor is engaging the private sector at all. Which brings us back to the silence after Sahlberg’s comment at the Dwight School that schools like Dwight don’t exist in Finland.
“Here in America,” Sahlberg said at the Teachers College, “parents can choose to take their kids to private schools. It’s the same idea of a marketplace that applies to, say, shops. Schools are a shop and parents can buy what ever they want. In Finland parents can also choose. But the options are all the same.”
Herein lay the real shocker. As Sahlberg continued, his core message emerged, whether or not anyone in his American audience heard it.
Decades ago, when the Finnish school system was badly in need of reform, the goal of the program that Finland instituted, resulting in so much success today, was never excellence. It was equity.
Since the 1980s, the main driver of Finnish education policy has been the idea that every child should have exactly the same opportunity to learn, regardless of family background, income, or geographic location. Education has been seen first and foremost not as a way to produce star performers, but as an instrument to even out social inequality.
In the Finnish view, as Sahlberg describes it, this means that schools should be healthy, safe environments for children. This starts with the basics. Finland offers all pupils free school meals, easy access to health care, psychological counseling, and individualized student guidance.
In fact, since academic excellence wasn’t a particular priority on the Finnish to-do list, when Finland’s students scored so high on the first PISA survey in 2001, many Finns thought the results must be a mistake. But subsequent PISA tests confirmed that Finland — unlike, say, very similar countries such as Norway — was producing academic excellence through its particular policy focus on equity.
That this point is almost always ignored or brushed aside in the U.S. seems especially poignant at the moment, after the financial crisis and Occupy Wall Street movement have brought the problems of inequality in America into such sharp focus.
“When President Kennedy was making his appeal for advancing American science and technology by putting a man on the moon by the end of the 1960’s, many said it couldn’t be done,” Sahlberg said during his visit to New York. “But he had a dream. Just like Martin Luther King a few years later had a dream. Those dreams came true. Finland’s dream was that we want to have a good public education for every child regardless of where they go to school or what kind of families they come from, and many even in Finland said it couldn’t be done.”
Clearly, many were wrong. It is possible to create equality. And perhaps even more important — as a challenge to the American way of thinking about education reform — Finland’s experience shows that it is possible to achieve excellence by focusing not on competition, but on cooperation, and not on choice, but on equity.
The problem facing education in America isn’t the ethnic diversity of the population but the economic inequality of society, and this is precisely the problem that Finnish education reform addressed. More equity at home might just be what America needs to be more competitive abroad.
When you read these excerpts from this article on the education system in Finland, what is striking is how much the philosophy behind their vastly superior system contrasts sharply with ours. What is really mind-boggling is that if you re-read the same excerpts, except substitute “health care system” for “education system,” you then will have an inkling of what we are doing wrong in both education and health care.
One fundamental concept that has appeared repeatedly on the pages of Physicians for a National Health Program (PNHP) is that excellence is a product of cooperation, not competition. It is not choice between private for-profit and public systems, but rather it is equity within public systems that facilitates excellence.
In both education and health care, Americans emphasize testing, accountability, merit rewards, competition, and choice. Yet Finland does not use standardized testing (analogous to HEDIS testing in health care), nor do they demand accountability – they don’t even have a word for it – but rather they expect responsibility. In Finland, all teachers are given prestige, decent pay, and a lot of responsibility. Finns are very uncomfortable with the concept of competition, especially since that interferes with the productivity induced in an environment of cooperation. Nor do they even consider choice – choice between publicly-financed and privately-financed schools – since the latter do not even exist.
So their secret is to establish equity and cooperation within the public sector. Now that it’s no longer a secret, we also can have high quality education and health care systems right here in the United States. We just have to shove the MBAs aside and place control in the hands of our own publicly chosen advocates of social justice.
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