History tells us that societal blind spots are common throughout the centuries from one society, culture or continent to another. An example in the late 1700s involves the first cancer hospital in the world. It was established in Reims, France, but was forced to leave the city in 1779 because of the public’s fear of contagion — most people then believed that cancer was spread by parasites.

Fast forward to the current debate in the United States over how to reform our increasingly unaffordable and dysfunctional health care system. Do we have any blind spots as this debate boils over such fundamental issues as the roles of the free market vs. that of government, and whether health care is just another commodity to be bought and sold on the open market?

Based on the content of the debate swirling around these questions and how the mainstream media are covering the story, we have two major blind spots in American culture today concerning health care — continuing denial that markets fail the public interest in health care, and that market failure leads to serious adverse economic, social and moral consequences. These two blind spots are interrelated and mutually reinforcing.

This recent statement by Rep. Paul Ryan (R-WI) illustrates the extent of our ideological blind spots about our market-based system. Commenting on a report by government analysts that health care spending will grow by about seven percent a year to a total of $4.3 trillion in 2017, he has this to say: “These are not signs that the health care market has failed.  In fact — and it is crucial to understand this — they are the predictable results of vast distortions imposed on the market over decades.  The government is the single greatest contributor to this problem.”

But markets in health care do not work the way they may in other sectors of the economy.  Here there is much less competition than market advocates proclaim, extensive consolidation within health care industries, wide latitude to set prices at what the traffic will bear, and pervasive conflicts of interest throughout the system encouraging over-utilization of wasteful, unnecessary and even harmful care.

The wreckage of markets in health care is all around us. Private insurers pursue their profits by many strategies to exclude or limit coverage of the sick. Their goal is to keep their medical loss ratios (the industry’s term for payments for medical care) below 80 percent, whereby they can retain at least 20 percent of premium revenue for overhead, profits and returns to shareholders. Whether hospitals, HMOs, nursing homes or mental health centers, investor-owned care has been documented by many studies to be more expensive and of poorer quality than not-for-profit care. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 has proven itself to be a bonanza for the drug and insurance industries. The government was prohibited from negotiating the prices of drugs as the Veterans Administration does so effectively, and the costs of drugs (the problem the bill was supposed to address) continue to surge upwards. Meanwhile the unregulated marketplace allows widespread profiteering through overuse in such areas as imaging centers, many of which are owned by the very physicians ordering the tests.

All this is predictable and of no surprise.  Joseph Stiglitz, Ph.D., Nobel Laureate in Economics and former chief economist at the World Bank, has this to say about markets: “Markets do not lead to efficient outcomes, let alone outcomes that comport with social justice.  As a result, there is often good reason for government intervention to improve the efficiency of the market.  Just as the Great Depression should have made it evident that the market does not work as well as its advocates claim, our recent Roaring Nineties should have made it self-evident that the pursuit of self-interest does not necessarily lead to overall economic efficiency.”

Our market-based system breeds costs, not restraint.  Despite the claims of their advocates, all of the various multi-payer proposals being considered in Congress, intended as they are to preserve a dying private insurance industry, have no effective methods to contain health care costs. With by far the most expensive system in the world, we ration care based on ability to pay. Despite the money we throw at health care, the quality and outcomes of our care compares poorly with many industrialized countries around the world that spend far less than we do.

And our societal blind spot extends as well to the social and moral consequences of our pro-market policies. As the income gap widens between the rich and poor and as the middle class falls into increasingly difficult straits in affording health care, our sense of social solidarity continues to erode.  Medical costs are now responsible for 62 percent of personal bankruptcies, most of whom were insured at the onset of their illness or accident.  All this while our supposed safety net, already frayed, further deteriorates in the face of increasing federal and state deficits.

So it is now time to take off our blinders and recognize these problems for what they are.  The government needs to play a greater role in health care, starting with a public system of financing that incorporates and builds on the strengths of our private delivery system.  Single-payer financing along the lines of the Conyers bill (H.R. 676) is an essential first step in the reform of U. S. health care for all Americans.

Whether we yet realize it or not, future generations will look back and wonder how we don’t see past our blind spots, in the same way as we find it hard to imagine the blind spot about cancer in France more than two centuries ago.

Adapted from The Cancer Generation: Baby Boomers Facing a Perfect Storm, 2009, with permission from the publisher Common Courage Press.  Order link

John Geyman, M.D. is the author of The Cancer Generation and Do Not Resuscitate: Why the Health Insurance Industry is Dying, and How We Must Replace It, 2009 by John Geyman. With permission of the publisher, Common Courage Press

Buy John Geyman’s Books at: http://www.commoncouragepress.com/

  • Comments Off

House bill includes transfer from wealthy

Posted by on Wednesday, Jul 15, 2009

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.

House of Representatives
July 14, 2009
H.R.____

To provide affordable, quality health care for all Americans and reduce the growth in health care spending, and for other purposes.

SHORT TITLE.–This Act may be cited as the “America’s Affordable Health Choices Act of 2009″.

TITLE IV–AMENDMENTS TO INTERNAL REVENUE CODE OF 1986

Subtitle D–Other Revenue Provisions

PART 1–GENERAL PROVISIONS

SEC. 441. SURCHARGE ON HIGH INCOME INDIVIDUALS.

(a) IN GENERAL.–Part VIII of subchapter A of chapter 1 of the Internal Revenue Code of 1986, as added by this title, is amended by adding at the end the following new subpart:

“Subpart B–Surcharge on High Income Individuals

“SEC. 59C. SURCHARGE ON HIGH INCOME INDIVIDUALS.

“(a) GENERAL RULE.–In the case of a taxpayer other than a corporation, there is hereby imposed (in addition to any other tax imposed by this subtitle) a tax equal to–

“(1) 1 percent of so much of the modified adjusted gross income of the taxpayer as exceeds $350,000 but does not exceed $500,000,

“(2) 1.5 percent of so much of the modified adjusted gross income of the taxpayer as exceeds $500,000 but does not exceed $1,000,000, and

“(3) 5.4 percent of so much of the modified adjusted gross income of the taxpayer as exceeds $1,000,000.

http://energycommerce.house.gov/Press_111/20090714/aahca.pdf

Health insurance and health care are no longer affordable for average-income individuals. Any reform proposal that would make health care affordable for everyone must include a transfer from the wealthy to average- and low-income individuals.

The authors of the House tri-committee reform bill explicitly acknowledge this fundamental principle by including a policy for a surtax on high income individuals to help finance the subsidies that will be required to assist individuals of more modest incomes with the mandated purchase of health plans. Has this taken care of the affordability issue?

Let’s go through the numbers again. Average health care costs for a family of four with an employer-sponsored PPO are now $16,771. That is the average cost for a relatively healthy sector of society. Many with greater needs pay more than that. That is the average health care spending under the best of conditions in our current multi-payer system, and it doesn’t even include insurer administrative costs.

Under this legislation, no subsidies are provided for individuals or families over 400 percent of the federal poverty level. For a family of four, that threshold is an income of $88,200. Thus average costs would be 19 percent of family income, and more for those with greater needs. By no stretch could that be considered affordable.

It’s great that the concept of income transfer has been accepted by the policymakers in Congress, but they need to go back to the drawing board to craft a plan that would actually work. (Hint: Provide all necessary services for everyone, and pay for those services through a single universal risk pool that is funded equitably using progressive tax policies.)

Senate HELP rejects enabling legislation for state single payer experiments

Posted by on Tuesday, Jul 14, 2009

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.

Senate HELP Committee
July 14, 2009

Sen. Bernie Sanders just offered an amendment to the Senate HELP health care reform bill that would allow a limited number of state experiments with single payer systems. The proposal would have provided waivers from federal regulations such as ERISA, and would have authorized current federal spending on programs such as Medicare and Medicaid to be transferred to the state to be used in the single payer program.

Those voting for the amendment:

Bernie Sanders
Tom Harkin
Sherrod Brown
Jeff Merkley

All Republicans and all other Democrats voted against it.

http://help.senate.gov/Hearings/2009_06_17_E/2009_06_17_E.html

List of committee members:
http://help.senate.gov/About.html

Senate HELP amendment on "data exclusivity"

Posted by on Tuesday, Jul 14, 2009

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.

NVCA Study Supports 12-Year Data Exclusivity Period

By Donald Zuhn
Patent Docs
Biotech & Pharma Patent Law & News Blog
July 13, 2009

On Friday, the National Venture Capital Association (NVCA) released the results of a study suggesting that “a data exclusivity period of at least 12 years for innovator products is a critical fulcrum in the effort to balance cost with the preservation of biotech innovation.”

http://www.patentdocs.org/

And…

Executive Session on the Affordable Health Choices Act

U.S. Senate HELP Committee
July 13, 2009

Consideration of the Enzi/Hatch/Hagan amendment on establishing a data exclusivity period of 12 years for biotech innovation

Sen. Orin Hatch: I don’t know a biotech company that isn’t for this bill, for this 12 year data exclusivity.

****

Sen. Kay Hagan: These individuals are out there looking for venture capital to obviously help them get these drugs to market… In order for our country to maintain this innovation and this research we need 12 years of data exclusivity.

****

Sen. Judd Gregg: Money flows into biologics research because capital moves there to make money. That’s the way a market system works.

****

Sen. Tom Harkin: Keep in mind what we’re talking about here. We’re not talking about patents. Everybody gets a 20 year patent… What we’re talking about here is data, data exclusivity… How do you get that data? You get it through FDA supervised trials… Where do they do those clinical trials? Academic health centers. Who supports academic health centers? Our taxpayers… When should that data be released so that another company out there, some other entrepreneurs, can look at the data and say… I’ll bet if we changed this and did this, we might come up with a new formulation that might actually help something else. They’re still going to have to go through their clinical trials… At least they’ll be able to look at the data. If you don’t do that that means that the company can sit on that data for 12 years. Then they let the data out. Clinical trials will take another 7 years or more, so you’re going to have at least a whole 20 year run in there… before anyone can ever surface with anything even comparable to what that drug or that biologic is.

****

Sen. Bernie Sanders: Let’s find out why year after year the drug companies make hugh profits, look at why the drug companies have never once, to the best of my knowledge, have never lost a political debate here in Congress… (medicine) doesn’t do anybody any good if they can’t afford it. I think for year after year we’ve been paying a lot of attention to our friends in PhRMA, who are spending, I don’t know what they spend in lobbying and campaign contributions, a whole lot of money. Maybe it’s time that we start worrying about the people who have to pay for this medicine.

****

Sen. Sherrod Brown: You know what we’ve not talked about, Mr. Chairman? We’re not talking about how much these biologics are costing patients. Let me give you some numbers. (examples)… 48 thousand dollars… 20 thousand dollars …100 thousand dollars. You know what the average wage in my state is? 46 thousand dollars… If we do this giveaway to the drug industry, this giveaway to the biologic companies, it means profits are up for them, it means executive salaries are up for them, it means we can all feel good, but let’s think about the patients, let’s think of the patient with breast cancer who has got to spend 1000 dollars a week… the patient with colon cancer who’s got to spend 2000 dollars a week… What kind of progress is that, Mr. Chairman?

****

The data exclusivity amendment passed by a vote of 16 to 7, with several Democrats voting in support.

421 minute video of the July 13 afternoon session:
http://help.senate.gov/Hearings/2009_06_17_E/2009_06_17_E.html

For the past week or so I’ve been live-streaming the Executive Session of the Senate HELP Committee as they have been marking up the Kennedy health care reform bill, the Affordable Health Choices Act. It has been running at the corner of my computer screen while I have worked on other projects. Since I am not competent at multi-tasking, I’m pretty jaded right now.

Last evening’s session devoted to the data exclusivity amendment was the longest amount of time they spent on any issue in the reform legislation. I stopped my other work to watch it. This morning, I’m not only jaded, but I’m also depressed. I’ll tell you why.

Earlier in the day yesterday, I sent out the following quote from Bill Moyers: “Nothing will change — nothing — until the money lenders are tossed out of the temple, the ATM’s are wrested from the marble halls, and we tear down the sign they’ve placed on government — the one that reads, ‘For Sale.’”

I didn’t sleep last night. Instead of counting sheep, I kept watching, in my nightmare, each of those Senators who voted yes picking up their bundle from the ATM machine in the marble halls on their way out as they passed the “For Sale” sign at the door.

But this isn’t about my nightmare. It’s about the 307 million of us who are the merchandise in Congress’s rummage sale. That’s why I’m depressed.

Bill Moyers on "The Select Few"

Posted by on Monday, Jul 13, 2009

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.

Bill Moyers & Michael Winship: Some Choice Words For “The Select Few”

Bill Moyers Journal
July 10, 2009

Enter “the select few who actually get it done.” Three out of four of the big health care firms lobbying on Capitol Hill have former members of Congress or government staff members on the payroll — more than 350 of them — and they’re all fighting hard to prevent a public plan, at a rate in excess of $1.4 million a day.

Health care policy has become insider heaven. Even Nancy-Ann DeParle, the White House health reform director, served on the boards of several major health care corporations.

President Obama has pushed hard for a public option but many fear he’s wavering, and just this week his chief of staff Rahm Emanuel — the insider del tutti insiders — indicated that a public plan just might be negotiable, ready for reengineering, no doubt, by “the select few who actually get it done.”

That’s how it works. And it works that way because we let it. The game goes on and the insiders keep dealing themselves winning hands. Nothing will change — nothing — until the money lenders are tossed out of the temple, the ATM’s are wrested from the marble halls, and we tear down the sign they’ve placed on government — the one that reads, “For Sale.”

http://www.pbs.org/moyers/journal/blog/2009/07/bill_moyers_michael_winship_so.html

The public option was the strategy of a large group of progressives to circumvent “the select few” who have continued to make sure that comprehensive reform was not politically feasible. With the favorable election results and with their campaign to market “your choice of health plans,” the progressives were confidant that they would be able to use the public option as a backdoor entry to affordable health care for all.

Once you think that you’ve closed the deal, you’re supposed to take down the “For Sale” signs. These progressives forgot to do that, and “the select few” came in with a lot more money and bought the place out from under them.

Who is left to toss the money lenders out of the temple? Or do they own the place in perpetuity?

Excluding seasonal agricultural workers

Posted by on Friday, Jul 10, 2009

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.

Harvesting Justice

By Bruce Goldstein
July 10, 2009

Sen. Hagan (D-NC) introduced Amendment 200 for the health care reform bill being discussed in the Senate Health, Education, Labor and Pensions (HELP) Committee, called the “Affordable Health Choices Act.”

Hagan’s amendment would exclude from the definition of “employees” any “temporary or seasonal agricultural workers . . . for the purposes of determining the size of an employer.” Agricultural employers of seasonal farmworkers would not be required to participate in the system because they would be considered to be too small. Seasonal farmworkers would be denied health care coverage.

Seasonal agricultural workers earn an average of $12,500 to $15,000 per year . They put food on our table by cultivating and harvesting fruits and vegetables, raising chickens, herding sheep, cutting flowers, and harvesting our Christmas trees. They work in the second or third most dangerous occupation. They cannot afford health insurance. It’s morally wrong — and it’s counterproductive economically — to exclude farmworkers from the plans for a reformed health care system.

http://www.harvestingjustice.org/

Everyone should have health care. Everyone.

Premium increases in non-profit health plans

Posted by on Thursday, Jul 9, 2009

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.

Health-plan costs soar for individuals

By Kyung M. Song
The Seattle Times
July 9, 2009

In what is becoming an annual ordeal for policyholders, Regence BlueShield is raising premiums for 135,000 individual health-plan members in Washington by an average 17 percent on Aug. 1.

It is the third consecutive year that the state’s largest provider of individual coverage has boosted rates by double digits. And it comes after two other insurers, Group Health Cooperative and LifeWise Health Plan of Washington, recently imposed similarly steep premium increases.

North Seattle resident Gail Petersen said having more choices won’t make health plans any more affordable. Petersen, 55, and her husband pay more than $1,400 a month to Regence to cover their family of five and will pay $300 more starting in August.

In 2008, Group Health rolled out eight products to join its lineup of a dozen individual health plans. They included high-deductible health savings accounts, which allow people to put aside up to $5,950 annually in pretax dollars — if they have that much upfront — to pay for medical expenses.

By catering to different population segments, Group Health in the past 15 months has nearly doubled its individual-plan members to 36,000. But those new customers are facing a 13 percent rise in premiums because Group Health underestimated anticipated medical claims, said Mike Foley, a spokesman for the co-op.

http://seattletimes.nwsource.com/html/health/2009436261_regence09m0.html

Once Congress passes a mandate for individuals to purchase health plans, presumably non-profit Regence BlueShield, as the largest provider of individual plans in the state of Washington, would be a provider of those plans. Also, Group Health Cooperative is the co-op that has been proposed to serve as a model for the public option.

Group Health has been shifting more costs to patients through consumer-directed high deductible plans and HSAs, and still has a double digit hike in premiums. Some model.

Can anyone seriously state, with a straight face, that mandating purchase of these plans will somehow magically end the double digit increases in premiums for these plans?

The answer to this question is actually quite complex, but the fundamental truth is that the cost containment measures under consideration in Congress will have very little impact in slowing the escalation of health care costs.

All other nations have health care financing systems that are much more effective in containing costs and without leaving people out, as we do. One simple click on this link will demonstrate in a single image how the United States is an outlier (and will remain so without bona fide financing reform):

http://economix.blogs.nytimes.com/2009/07/08/us-health-spending-breaks-from-the-pack/

In this graph, note that Canada and the United States followed the same curve until Canada established its single payer system. Then look at what happened.

Can Medicaid fill the gap?

Posted by on Wednesday, Jul 8, 2009

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.

To: Sen. Judd Gregg, Ranking Member, Senate Budget Committee

From: Douglas W. Elmendorf, Director

Congressional Budget Office
Letter
July 7, 2009

In response to your request, the Congressional Budget Office (CBO) has considered the likely effects on federal spending and health insurance coverage of adding a substantial expansion of eligibility for Medicaid to the Affordable Health Choices Act, a draft of which was recently released by the Senate Committee on Health, Education, Labor, and Pensions (HELP).

CBO has not yet had time to produce a full estimate of the cost of incorporating any specific Medicaid expansion in the HELP committee’s legislation. However, our preliminary analysis indicates that such an expansion could increase federal spending for Medicaid by an amount that could vary in a broad range around $500 billion over 10 years. Along with that increase in federal spending would come a substantial increase in Medicaid enrollment, amounting to perhaps 15 million to 20 million people. Such an expansion of Medicaid would also have some impact on the number of people who obtain coverage from other sources (including employers). All told, the number of non-elderly people who would remain uninsured would probably decline to somewhere between 15 million and 20 million. (For comparison, CBO’s analysis of the draft legislation that was released by the HELP committee found that, absent any expansion of Medicaid or other change in the legislation, about 33 million people would ultimately remain uninsured if it were to be enacted.)

http://www.cbo.gov/ftpdocs/104xx/doc10445/07-07-2009-ExpandingMedicaid.pdf

From the start it was recognized that insurance exchanges, even if they included a public option, could never provide affordable coverage for low-income individuals. The Medicaid program would have to be expanded to cover this more vulnerable population.

It was also recognized that, even with subsidies, there are many individuals who could not afford to purchase plans through an exchange yet have incomes above the thresholds that would qualify them for Medicaid.

That has led to the new definition of universal coverage as being “close to 95 percent.” This CBO analysis provides support for that view. Leaving only 15 to 20 million people without coverage has become one of the parameters that will define “success” in the reform efforts.

And costs? This Medicaid expansion can be accomplished for only half a trillion dollars (federal component), that is if it is agreed that the program will continue to be chronically underfunded. If it is eventually decided that Medicaid must cover actual health care costs, then add those costs to this half a trillion dollars plus to the funds already obligated for the 60 million people now covered by Medicaid. Once 75 to 80 million people are on Medicaid – over one-fourth of our population – adequate funding will be essential if there are to be enough willing providers to be there to give care when needed.

Keep in mind that all health care costs still must be met one way or another in a fragmented multi-payer system, but with the inevitability of inequitable cost shifting. This inequity potentially can have an adverse impact on the health and finances of tens of millions of Americans. However the total costs are much higher than they need to be because of the profound inefficiencies of this dysfunctional financing system which Congress has elected to protect and expand.

Under a single payer system – a reformed Medicare for all – everyone would be included automatically and without the projected cost overruns that are plaguing the current reform process. Those were the goals of reform, but they seem to have been chewed up in the legislative sausage machine of Congress.

A German comments on U.S. health care

Posted by on Tuesday, Jul 7, 2009

The following comments are in response to a recent Quote of the Day by Don McCanne about the broken, employer-based health insurance system in the United States.

By Diana Stritzel

I just wanted to say that I really enjoy reading your articles and feedback on what’s going on about health care in the U.S. I don’t remember how I found your list and subscribed to it, but I find it really useful to learn more about the system.

Being German by birth, I find it really awful what people here in the U.S. are being subjected to just to go and see a doctor. I’ve had people at my workplace telling me how horrible it must be that I don’t have the choice of doctor in my country of origin. I was like …What? I never had so many problems in any other country I’ve been in before.

The U.S. is the worst. (I’ve lived in United Kingdom, Italy, New Zealand and Australia.) My employer provides coverage, and not a bad one, as I’ve been told. Now, I’ve had nothing but trouble with the insurer (Aetna). I was on PPO plan before, but now I moved to my employer’s state (California) and I’m covered on Aetna’s HMO plan.

But for all plans I have to go online or call them first, and find a doctor which is in the network, so that Aetna covers it. In Europe I never had that problem, I can go to any doctor anywhere and I don’t need to ask or check with insurance first.

Then there’s the administrative effort required. Every time I go to a doctor, I have to fill out so much paperwork, and sign three statements that I will pay for all charges incurred in case my insurance doesn’t pay. As if that wouldn’t make you feel more miserable than you already are (seeking a doctor in the first place).

And after all that, I’ve still had bills coming to my house, which led me to call my insurance company and they told me I’ll have to pay these, because my doctor requested tests from a lab which is not in Aetna’s network. So now I have to be paranoid about each test the doctor wants to do, and ask the doctor to please use a lab which is covered by Aetna. Outrageous!

After my move to California I was unlucky enough to be in need of emergency room. They suggested I go for a follow-up in a couple of days. Since I hadn’t been to my “PCP” yet, and I live in San Diego, whereas Aetna send me a coverage card which stated that my PCP is in Los Angeles, when trying to change my PCP to one in San Diego I failed in three attempts (one online, and two by phone). Once I was in the doctor’s practice, they called to verify with Aetna that this was changed (because I only had the card which stated the L.A. doctor’s name), and Aetna’s employees said no. (I had been on the phone with them forever until they finally said yes, we’ve changed it.)

The doctor suggested I pay for the visit and claim it back, but I had learned from before (my PPO plan) that Aetna will find a way to never pay these back to me. So again I called them up and asked for changing my doctor. I was wondering why they added a doctor in L.A. in the first place as they had my correct address in San Diego.

Anyway, after subjecting me to lots of useless questions like “When are you planning to change your PCP again?” (which made me wanna cry…. I didn’t choose that doctor!), finally they said that they changed it, and I made them give verbal confirmation to the practice right away, so I could finally see a doctor.

I haven’t received any bills yet, but I’m wondering when they might come.

I think the system as a whole is really awful. Hard to see any light at all, with politicians taking the bribes from insurance companies and such statements as Obama’s below. [Editor’s note: the reference is to President Obama’s comment that moving to a single-payer system would be disruptive.] I don’t understand why Americans don’t fight more for health care, which is one of the most important things to have. The feeling of security that comes with a health care system like in the U.K. (where I studied and lived many years) is just not replaceable.

I for my part wish you all the best, and I do hope you will not stop fighting for your right to health care (yes, in my opinion it is a right which every human should have).

Thanks for your articles and the awareness you bring to this topic. I’m following Ralph Nader as well, and I do hope that despite all the ridiculing your media does to him, that maybe one day someone will listen and change the system. I hope I’ll see the day, I know for sure that I won’t be living in U.S. by then though.

Thanks and keep going!

The hijacking of health reform

Posted by on Tuesday, Jul 7, 2009

Originally published in The Berkshire Eagle

Headlines in the Berkshire Eagle recently proclaimed that Berkshire Health Systems (BHS) is cutting the equivalent of 65 full-time jobs, and will lose $3 million this year. This is neither good for employment nor for the health of our population in the Berkshires. The culprits are the cuts to Medicaid and Medicare, the programs that cover 70 percent of the BHS population.

BHS president David Phelps reports that financial problems at Berkshire Medical Center have been aggravated by Massachusetts health care reform. While more patients have enrolled in insurance plans, the reimbursements for these plans are similar to Medicaid rates, which don’t actually cover the cost of care.

As the major non-profit provider of health care for the Berkshire community suffers financially, the for-profit insurance industry, (which only administers the funds, and provides no actual health care services), is raking in the money. In the current economic and health care crisis, United Health Group, America’s largest health insurance company, enjoyed an increase of 8 percent in revenues for the first quarter of 2009, with a net profit of $984 million. There is something wrong when the administrators of the health care funds are making exorbitant profits, while the providers of the health care services are struggling to remain solvent.

The private for-profit insurance industry diverts roughly $400 billion/year from medical services. In addition, the Senate Commerce Committee recently released a staff report about how health insurers have forced consumers to pay billions of dollars in medical bills that the insurers should have paid themselves.

Will the current health care reform being formulated in Washington address these issues? Not a chance, even if President Obama gets a public plan option into the reform legislation. Dr. Steffie Woolhandler, a founder of the 16,000-member Physicians for a National Health Program, stated in her testimony to Congress: “Insurers compete by not paying for care: by denying payment and shifting costs onto patients or other payers. These bad behaviors confer a decisive competitive advantage. A public plan option would either emulate them — becoming a clone of private insurance — or go under. A kinder, gentler public plan option would quickly fail in the marketplace, saddled with the sickest, most expensive patients, whose high costs would drive premiums to uncompetitive levels.”

In addition, the overhead for a public plan option would be higher than for Medicare, which automatically enrolls seniors at 65, deducts premiums from Social Security checks, and does no marketing. The administrative costs for the whole health care system would remain astronomical, as health care providers would continue to struggle with mountains of paperwork and denials of payment from multiple insurance companies. A public plan option would not curb the escalating costs of new technology, and would not address variability in the quality of care.

The only way to attain universal health care coverage, while containing escalating health care costs and standardizing quality of care, is to eliminate the insurance companies, and establish a single-payer “Improved Medicare for All” program. Hospitals, doctors and other providers must be adequately reimbursed for their medical services. This would be possible if the profiteering and waste of the health insurance industry were eliminated, and those health care dollars went to the actual provision of medical care. And hospitals could be paid like fire departments, with a single monthly check and little billing. There is federal legislation for a national health program in both houses of Congress, John Conyers bill, HR 676, and Bernie Sanders bill in the Senate, S.703.

Last year a survey of doctors showed that 59 percent support a national health plan, up from 49 percent in 2002. (Only one in five doctors are in the American Medical Association, which opposes a national health plan). So why is single-payer health care reform “off the table”‘ as Senator Max Baucus, chairman of the Finance Committee, said, before he threw eight single-payer advocates, including several doctors, out of a “public roundtable discussion” and had them arrested. Could it be related to the more than $1 million in donations Baucus received from the insurance and pharmaceutical industries in the 2008 election year cycle?

Wendell Potter, a former health insurance industry insider has this to say, “. . . big for-profit insurers have high-jacked our health care system and turned it into a giant ATM for Wall Street investors, and . . . the industry is using its massive wealth and influence to determine what is (and is not) included in the health reform legislation members of Congress are now writing.”

What is going on in Washington right now is not in the best interests of patients, or the doctors and hospitals that serve them. Patients have no lobbyists speaking for their interests in Congress. Most doctors do not want the AMA to speak for them. Contact your congressmen and ask them to sponsor HR 676 and Bernie Sander’s bill. (On his Web site, Sanders also has an online petition you can sign and pass along to your friends).

About this blog

Physicians for a National Health Program's blog serves to facilitate communication among physicians and the public. The views presented on this blog are those of the individual authors and do not necessarily represent the views of PNHP.

News from activists

PNHP Chapters and Activists are invited to post news of their recent speaking engagements, events, Congressional visits and other activities on PNHP’s blog in the “News from Activists” section.