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March 31, 2001

Former JAMA Editor Laments the State of Medical Care


Los Angeles Times
March 26, 2001
by Linda Marsh

An interview with George D. Lundberg, M.D., former editor of the Journal of the American Medical Association:

Question: To switch gears a bit, you've been highly critical of managed care....

Answer: Managed care is basically over. People hate it, and it's no longer controlling costs. Health-care inflation is now back in the double digits. So if it's not saving money, then why should we have it? But like an unembalmed corpse decomposing, dismantling managed care is going to be very messy and very smelly, and take awhile.

Question: What do you see taking its place?

Answer: In the future, I think we'll see some form of government health insurance, along the Medicare model. Not necessarily socialized medicine but one large insurance pool or one single payer where people and employers can buy in. I think we should have some kind of mandated health insurance, where every American has to buy a policy with a high deductible, and the individual has to pay above a certain point. People won't spend their money unless it's justified. It's the only way we can control costs.

Comment: "...one large insurance pool or one single payer..." ...reality sinks in.

Although Dr. Lundberg needs to brush up on the health policy implications of mandates, buy-ins, employment linkage, high deductibles, caps, and alternatives for cost containment, nevertheless, it is very reassuring to see that a highly respected and very ethical traditionalist recognizes the inevitable.

March 30, 2001

Rationing or waiting?

Kip Sullivan, noted author on health policy:

We should undertake a campaign to stamp out the use of "rationing" to mean "waiting" where no harm is caused by waiting. "Rationing" in common parlance means "denial of a necessary service," as in, "Cuba is
rationing electricity by shutting off power to whole neighborhoods for hours at a time." Waiting nine months for a bone marrow transplant (US) or ten (Canada) is not rationing in the absence of evidence that this delay is harmful (George Silberman et al., "Availability and appropriateness of allogeneic bone marrow transplantations for chronic myeloid leukemia in ten countries," New England Journal of Medicine 1994:331:1063-1067).

Those who use rationing to mean waiting for care put harmless waiting in the same category with denial. There oughta be a law against it.

Comment: Ida Hellander, commenting on the same study, notes that "the data show that some countries that have been characterized in the public debate as much more restrictive in the provision of sophisticated health care treatments actually had levels of transplantation that were equivalent to, if not greater than, those of the United States."

March 29, 2001

The Canadian Cure


The New Rules
Winter 2001
by Daniel Kraker

Morton Lowe, M.D., coordinator of health sciences at the University of British Columbia:

"Canada rations by queuing. You have to wait your turn for a hip transplant even if there are three poorer people in front of you. Which I think is damn fine. In the U.S., if you're rich, you get it fast, and if you're poor, you don't get it at all. That's how they ration."

Comment: Even if we had universal coverage, queuing should not be as much of an issue in our system that is characterized by abundant resources and excess capacity. According to David Himmelstein, M.D., scheduling delays are common and expected in the United States, but, whereas they are called a queue in Canada, in our country they are not called anything.

The full article, which suggests that the United States should take another look at the Canadian model, is available at: http://www.newrules.org/journal/nrwin01health.html

March 28, 2001

"World Trade Organization Targets Canadian Health Care System" by Stuart Laidlaw

Despite its failure to get a mandate in Seattle, the World Trade Organization has been progressing with free trade talks in Geneva for more than a year.

The talks, required to start by 2000 under past trade deals, have been held with very little fanfare, behind closed doors and with little input from those affected.

This week, three more days of talks will take place - again in Geneva, again behind closed doors and again without input from those affected.

And make no mistake about it: health care will be on the table.

Ottawa, of course, has vigorously claimed otherwise. It has, after all, invoked a feature of existing world trade deals allowing countries to specifically exempt parts of their economies from international free trade rules. On the face of it, this would seem to protect our cherished health care services from foreign and private incursion.

A closer look, however, reveals several concerns.

First off, both the U.S. and Europe have said they will be demanding an end to such exemptions. If they are successful - and these two working together make a powerful team - Canada's protection will be gone. Canada's own bargaining position at these talks - demanding the right to export health care while not allowing any imports - dangerously undermines our credibility in arguing to keep health care off the table.

But even if the U.S. and Europe are not successful, and even if we can successfully negotiate our import-banning, export-pushing trade position, there is still plenty of reason to worry. That's because, while health care itself is exempted, much of what makes it up is not.

Take public health insurance. Canada has registered health insurance at the World Trade Organization as a financial service, leaving the very heart of medicare vulnerable to trade deals requiring Canada to open the field to foreign and private investors.

You would hope that this classification applies only to the private health insurance plans many of us enjoy at work to cover dental care or medication, but there's nothing in Canada's WTO commitments to spell that out. It just says "health insurance," leaving it up to the WTO to define for us.

There's more. The Canadian Centre for Policy Alternatives - echoing sentiments by more conservative trade experts such as John Kirton of the University of Toronto - argues that Canada could see much of its medicare
system whittled away under the WTO's General Agreement on Trade in Services.

Services such as labs, food services, janitorial services, accounting, data processing, telecommunications (such as Ontario's new phone-a-nurse service) and even hospital administration in the form of management consulting are already under the purview of the WTO's agreement on trade in services.

A foreign company could argue that it is not trying to tell Canada how to run its health-care system, but just wants a shot at managing parts of it. If the WTO agrees - and it tends to favour free market arguments - we would be forced to allow private companies into our health-care system.

Not that private companies aren't already in the health business in Canada - which further weakens the government's assertion that medicare is safe from the WTO.

Here's how: The WTO allows governments to exempt any service provided "in the exercise of government authority," as long as such services are not also available commercially.

In other words, if a service is exclusively provided by the government, it is exempt. But if that service is provided through a mix of both government and private interests, it is open to the full force of the WTO.

Health care is such a service. The government, through medicare, obviously plays a huge role. But much of the health-care system is, in fact, privately run. Doctors' offices operate as private businesses. So do the labs in many hospitals, after-hours clinics, dental offices, homecare providers and nursing homes. Even the hospitals themselves are often private, non-profit corporations. This makes our health-care system a mixed private-public system, and therefore subject to WTO rules.

Ottawa's trade negotiators have characterized such concerns as "hypothetical," and doubt any such challenges would ever materialize.

That is folly, and we need only look as far as the recent death of the Auto Pact to see the threat to health care.

The 35-year-old pact regulating the manufacturing of cars in North America was struck down by the WTO last year under its General Agreement on Trade in Services, the deal being refined and expanded this week in Geneva.

The Auto Pact required that the Big Three automakers make as many cars in Canada as they sold. Japan and Europe successfully argued before the WTO that the deal actually regulated the marketing of cars, not the manufacture.

And because marketing is a service, the Auto Pact fell under the General Agreement on Trade in Services, which requires that countries treat foreign companies the same way they treat domestic companies. That forced Canada to lift the tariff on Japanese and European imports.

If the World Trade Organization is willing to stretch the coverage of its service deal to include auto manufacturing, you can bet it will be willing to bring Canada's health-care system under its umbrella, too.

Brave words by our negotiators and doubts that it will ever happen are simply not enough.

Four weeks ago in this space, John Core, former head of the milk marketing board, urged farmers to keep a close eye on the agricultural talks in Geneva to ensure that Ottawa's negotiators stick to their commitments to protect Canadian farmers.

"It will not be acceptable at the end of the talks for our negotiators to say, `We tried,'" he wrote.

It's a warning we all should heed.

Stuart Laidlaw is a member of The Star's editorial board.
Copyright 1996-2001. Toronto Star Newspapers Limited

The Convention on the Rights of the Child


Adopted by the General Assembly of the United Nations on November 20, 1989

Summary of Article 24: Health and health services

"The child has a right to the highest standard of health and medical care attainable. Nations shall provide special emphasis on the provision of primary and preventive health care, public health education and the reduction of infant mortality. They shall encourage international cooperation in this regard and strive to see that no child is deprived of access to effective health services."

Comment: The Convention on the Rights of the Child has been ratified by every nation except two. Somalia is unable to proceed to ratification as it has no recognized government. The only other nation that has failed to ratify the Convention is... the United States! The ratification process has been halted at the Senate Foreign Relations Committee.

Where is the outrage? Americans certainly would support the concepts of the Convention, but they remain uninformed. It is our responsibility to disseminate information about the Convention and about the political
process that is suppressing social justice in our nation. Start writing those articles, letters and editorials now.

Complete information on the Convention is available at: http://www.unicef.org/crc/crc.htm

(Thanks to Jane G. Schaller, M.D., President-elect of the International Pediatric Association, for today's quote.)

March 21, 2001

Hearing on Living without Health Insurance: Solutions to the Problem


United States Senate
Finance Committee
March 15, 2001

Senator John Rockefeller, responding to proposals for tax credits:

"So that if you're going to do health insurance for people, then you have to do it properly. And the tax credit is the wrong approach. It is the wrong approach, period. That's all there is to it. It will not work. It will not work at the figures that are being offered by you...the figures that'll come in part from the other side, maybe some from
our side. It won't work. And I think we have to decide on this committee do we want people to get health insurance or do we not?"

http://www.kaisernetwork.org/admin/healthcast/uploaded_files/sfi031501.pdf

March 16, 2001

As ER visits climb, hospitals react


The Philadelphia Inquirer
March 16, 2001
by Stacey Burling

"Some experts say the emergency room is being transformed from a last recourse in desperate moments to a place where people can get all sorts of care at all hours."

"Rather than fighting the trend, some hospitals are accommodating the increased traffic by adding physicians' assistants and nurse practitioners to ER staffs and offering 'fast track' care."

Ted Christopher, ER director at Thomas Jefferson University Hospital:
"I think emergency medicine is probably misnamed. It should probably be named 24-hour-access care."

Uwe Reinhardt, Princeton University health economist:
"Using the emergency room for routine procedures is actually quite efficient."

Michael Carius, president-elect of the American College of Emergency Physicians:
"You can either try to change demand, or you can try to meet demand."

Comment: There is a great need for night and weekend clinical services. The emergency rooms are filling this role by default. Emergency room costs are high, in part because of the numbers of uninsured that resort to this source of care. Shunting the non-life threatening cases to more efficient care within the same facility improves the utilization of resources. In addition, if we were to adopt universal health insurance, we would end the cost-shifting that makes emergency services outrageously expensive for the rest of us.

March 15, 2001

Insuring the uninsurable: The sick are losing a safety net against financial ruin


The Sacramento Bee
March 11, 2001
Editorial


"Every citizen who can't get health insurance is a black mark against a society that claims to be civilized. But those whose plight ought to cause the biggest pangs of conscience are the medically uninsurable: men and women who are willing to pay for individual health insurance but who are denied individual coverage by insurance carriers because of pre-existing medical conditions."

"A health insurance system worthy of the name ought to have mechanisms to make sure that even people with pre-existing conditions can get covered. A universal system, in which all citizens were required to participate, could do that, making everybody broadly and progressively share the higher costs of covering the sick."

"In a state as rich as California, it's a disgrace that more and more people with chronic illnesses face financial ruin because they are turned away for health insurance."

Comment: Let's hope that our "biggest pangs of conscience" for the "medically uninsurable" do not deter us from seeking a solution that will include coverage for the "financially uninsurable" who should be generating equally big "pangs." Only by including everyone can a society erase all of its black marks.

March 14, 2001

Editorial debate: Rising Medical Costs


USA Today
March 14, 2001

View of USA Today: Better planning is needed to avoid pitfalls of last revolution.
Opposing view: Rather than shift rising costs to patients, cut out HMO middlemen.

USA Today:
"And employers who think defined-contribution health plans are the way to go will have to provide solid answers - before jumping at what appears to be a quick solution to the current cash crunch. The last thing the nation needs is another health-care revolution that fails to perform as promised."

Ida Hellander, M.D., Executive Director of Physicians for a National Health Program:
"Upping costs for families and the sick would cause millions of casualties. National health insurance would cause just two: HMOs and obscene drug-company profits."

USA Today opinion:
http://usatoday.com/news/comment/2001-03-14-nceditf.htm

Other opinion:
http://usatoday.com/news/comment/2001-03-14-ncoppf.htm

March 13, 2001

USA Today by Ida Hellander and Don McCanne

Upping patients' share of premiums and medical bills won't slow skyrocketing health-care costs. But it will penalize the sick and keep millions away from life-saving care.

Americans already pay more out-of-pocket for health care than patients in any other country. Yet we have the world's highest health-care costs. We're not getting much for our money: A recent World Health Organization study ranked the USA a dismal 37th in the quality of our health system. Meanwhile, 43 million Americans are uninsured; a recession would push that number to 60 million.

The last time premiums were rising in the double digits, policymakers herded workers en masse into skimpy HMOs. A decade later, studies show that HMOs didn't save us a dime; they just diverted money from patient care to bureaucrats and investors. It's now clear that the slowdown in premium increases in the mid-1990s came from a downturn in the insurance-underwriting cycle, not from HMO bean counters.

Meanwhile, HMOs sucked billions out of Medicare, then dropped seniors once the profits dried up. Rather than admit their world-class incompetence, the policymakers who pushed HMOs now want to shift the blame, and more of the health-cost burden, to working families and sick people.

What happens when you raise co-pays and force people into skimpier plans? Sick people don't go to the doctor, and many skip essential medications. Some make it through on their own: The cough turns out to be a cold, not lung cancer; the stomachache is food poisoning, not appendicitis. But some don't. Already, emergency-room doctors report seeing more patients who wait until their illness has advanced to stages previously seen only in the Third World.

And shifting costs onto patients is totally unnecessary for cost containment. Most other wealthy nations Ñ Sweden, Norway, Denmark, France, Germany, Canada and Australia Ñ control costs without significant co-payments or deductibles, while allowing patients a free choice of doctors.

Their secret? National health insurance. You make a health-care budget for the country as a whole. You cut out the HMO middlemen and strictly limit health-care bureaucracy to 2%-3% of costs. (We squander 25% on paperwork.) You negotiate fees with doctors and hospitals, and bargain hard for the best prices from the giant multinational drug companies. The savings on bureaucracy and corporate profits would allow us to fully cover everyone for what we're now spending.

Upping costs for families and the sick would cause millions of casualties. National health insurance would cause just two: HMOs and obscene drug-company profits.

Ida Hellander, M.D., is executive director, and Don McCanne, M.D., director of Physicians for a National Health Program

© Copyright 2001 USA TODAY

March 11, 2001

Another quote of Uwe Reinhardt from the February 27 conference on "Bipartisan Paths to Expand Health Coverage"


:

"And I said this is the only issue (covering the uninsured) I actually take seriously. All the rest of American health policy to me, as you well know, is a joke or a source of humor. This one really is not."

"... health insurance gives you financial protection. It protects you bankruptcy of families in the United States... And one may well ask what kind of society is it where if a family member gets stricken with cancer, the family also goes bankrupt with all the stress and indignity of that. You cannot travel in France as an American and hold up your head, that we allow this sort of thing to happen. Someone has a child sick with cancer and the family goes broke. That is uncivilized in the eyes of Europeans and Canadians, and in the eyes of many Americans, most of us here included."

The transcript of the conference is available at:
http://www.kaisernetwork.org/admin/healthcast/uploaded_files/kff022701a.pdf

March 10, 2001

The State of Health Insurance in California: Recent Trends, Future Prospects


UCLA Center for Health Policy Research
March 2001

by E. Richard Brown, PhD, Ninez Ponce, PhD, & Thomas Rice, PhD

"The state's strong economic growth has enabled more families and individuals to obtain job-based insurance, resulting in a lower uninsured rate for the first time in several years. But the future prospects for this trend continuing seem uncertain at best. The economy
appears to be cooling, accelerated in California by the energy crisis - a trend that may be undermining the major factor in the state's recently expanding coverage. And there is clear evidence that health insurance premiums are going to rise by double digits in 2001, making health insurance coverage less affordable at the very time when the labor
market is likely to slacken. When the economy does contract and health insurance costs rise, more Californians will almost certainly become uninsured."

"In the longer run, California and the nation need to extend to all residents affordable coverage that provides good access to high quality health care that enhances people's health. Although there are costs to ensuring that all residents have coverage, there are great costs associated with a large portion of our population remaining uninsured - lost earnings, lost school days, lost potential, and lost life."

The full report is available at:
http://www.healthpolicy.ucla.edu/FullReport.html

March 09, 2001

A Conservative Convert To Socialized Medicine by David Burgess

http://www.iht.com/articles/12871.html
http://www.commondreams.org/views01/0309-03.htm

PARIS - What's the old joke? A conservative is a liberal who has just been mugged? Well, I am a conservative who has just been "mugged" by the socialized French health system, and, to my astonishment, I'm a believer. I have lived in France for nearly 19 years. Until about two years ago I was very cross about the amount I had to pay in taxes and in "social charges," which finance the medical system, in which a pauper gets about the same medical care as a millionaire.

Let me take you quickly through my experience of being gravely ill in France.

For 20 years or so I had been a gobbler of antacids in one form or another, and in October 1998 I began to have trouble swallowing. I assumed it was an ulcer and took the appropriate medicine, but it didn't go away. At the end of the year I was referred to a doctor who performed an endoscopy, in which, under anesthetic, a tube is inserted in the throat, allowing the doctor to have a look around and do a biopsy. He found that I had a malignant tumor at the base of my esophagus, where it meets the stomach, that had virtually closed the passage.

The doctor lost no time. He called my local hospital, which fortunately was one of the four in the Paris area that could do the operation that I needed, and reserved me a bed for the next day.

At the hospital, within an hour or two of my arrival, my surgeon, who has the title of professor, as he is head of the department of digestive surgery, paid me a visit. He outlined the operation I would have, and, in answer to my question, said the mortality rate for the kind of cancer that I had was about 85 percent within the first three years. But, he said, "Don't worry, we're going to beat it."

Foolishly, I suppose, I believed him. Now, more than two years later, I still do; he has lots of charisma.

After my operation, which lasted more than 10 hours, I was in the hospital another three weeks, then home, where a nurse came by each day to give me the shots I needed, check and dress my surgical wounds and make sure that I wasn't losing weight. Then back to the hospital for three days of chemotherapy every three weeks - four treatments in all.

I was operated on in mid-January 1999, went back to work part-time in mid-May, and returned to work full-time in September. (For those of you who are less than enthusiastic at the prospect of going to work in the morning, there is nothing like a serious illness to adjust your outlook.) Why does socialized medicine seem to work in some places and be a disaster elsewhere? Anyone who reads the British press is assaulted daily with tales of how cancer patients have to wait months for an appointment with an oncologist, or a candidate for a hip or knee replacement has to wait years. In France, such delays can be measured in days or, at most, weeks.

Why the difference? Take a deep breath. These are the numbers, provided by the French and British health ministries and translated into dollars (bear in mind that Britain and France have roughly the same populations). French total expenditure on health in 1999 was $109.5 billion. In Britain it was about $78.02 billion. Per capita, it was $1,800 in France and $1,312 in Britain. As a percentage of the gross domestic product, it was 8.5 percent in France and 5.9 percent in Britain.

I should mention that I am not yet out of the woods. My markers, blood tests that indicate the presence of cancer, started to rise last summer, and since the end of September I have again been in chemotherapy. The markers have dropped consistently, showing that the therapy is working. The treatment is debilitating. I expect to resume work part-time from April or May until the summer vacation, and full-time thereafter.

Last summer, I asked a friend of mine, a dean at a medical school in New England, what the cost of my care would have been in the United States. "About $700,000," she said. I haven't seen a bill. Well, that is not quite true. I got a bill for 43 francs (about $6.50). I'm not sure what it was for, but I paid it.

I no longer complain about my taxes.

Copyright © 2001 the International Herald Tribune

Bipartisan Paths to Expand Health Coverage: Prospects for 2001 and Beyond


February 27, 2001
Washington, DC

Gail Wilensky:

"... it doesn't ignore the fact that making people more cost conscious, which I think Congressman McCrery, you ought to make sure is in every paragraph that you talk about your healthcare plan; it's a very important issue that will drive change."

Uwe Reinhardt:

"Whenever I hear cost-consciousness as an economist I ask myself -- I read yesterday in 'The Wall Street Journal' that Paul O'Neill's income last year was $56 million the Treasury's Secretary. Now I ask myself, how do I want him to be cost conscious about healthcare? How do I do
that when the guy's annual income is $56 million; what am I gonna charge, am I gonna charge 20 million for the bypass? Because that's roughly what it would be to put him on power with the waitress, so when you say you want to make people more cost conscious you really should
speak plain English. You want to ration by income class."

"So when you talk about cost consciousness, you're really saying the lower middle class should get less healthcare, and maybe they should, but say so."

March 08, 2001

Employers Say They Lack Data on Quality of Health Care


The Washington Post
March 8, 2001
by Bill Brubaker

Susan Pisano, a vice-president of the American Association of Health Plans:

"There is quite a lot of information that is available about the performance of America's health plans."

Comment: Unfortunately, most of the information currently available about the quality of health plans is of almost no value.

The majority of health plans are network model plans which contract with the health care providers at large. When quality parameters of different plans are measured, the same overlapping group of providers is being measured. When the same physician is being evaluated by each of the many plans with which he or she contracts, differences in sampling results have virtually no meaning.

The quality measurements designed by the health plan industry are usually designed to produce positive marketing messages. Patient satisfaction surveys are subject to the bias that, "Managed care is terrible overall, but I am very satisfied with my doctor and my health plan."

Measurements of rates of favorable interventions, such as percentages of pap smears or retinal examinations in diabetics, have demonstrated that integrated staff model plans can improve the levels of these parameters
when compared to the loosely structured and overlapping network models. A deficiency of this approach is that providers are aware of the relatively few parameters that will be measured. The quality improvement programs are then often directed primarily to these very limited areas.

Other significant efforts are being made to improve quality assessment, and we will have better measurements. However, there is a much greater need to design a system that will promote quality in the first place. Although we have had many technological advances, measurements have shown that they have not had much impact in improving outcomes, compared to their cost, primarily because our system has been incapable determining and promoting the optimum use of this technology. Standards of practice vary tremendously between communities and between individual practitioners. Integrated staff model organizations have demonstrated that better standards of practice can be recognized and encouraged, and
errors, such as incompatible medications, can be greatly reduced. In this modern age of information technology we now have the opportunity to integrate our entire health care system. Structural design is the key
to quality. With a rational system in place, quality assessment can be elevated to a more noble purpose, and that is to provide a basis for continuing improvement in our health care structure.

As long as we continue with our fragmented health care system, quality improvement will remain only a dream. Let's defragment our system by starting with a foundation of a publicly administered, universal risk pool. We have the resources for high quality care for everyone. Let's start using our resources wisely.

March 07, 2001

Those who know how government works will reject universal coverage


American Medical News
Published by the American Medical Association
March 12, 2001
Letters to the Editor


Daniel Joyce, M.D., Niles, Mich.:

"... when the government provides something like health insurance to everyone, people tend to look at it as their right to health insurance versus appreciating the wonderful gift that is being provided to them. I see this all the time in the government programs. The people who are provided these wonderful things are often very ungrateful. If charitable organizations provide the same assistance out of the generosity of their heart, people then realize that it isn't their right and appreciate the kindness as it should be appreciated."

Comment: The American Medical Association professes to serve the public interest in health care matters. Its leadership could do that now by instructing its members on the basic fundamentals of health policy. But before that is possible, the leaders themselves will have to take a crash course in health policy to learn why tax credits and medical
savings accounts, which they support, will never serve the public interest. If the AMA would shift to advocating for patients instead of physicians, the organization would find that they would be supporting a practice environment that is in the best interests of both patients and physicians.

Following are the comments of Tom Mainor, pastor of the Shady Grove Presbyterian Church in Memphis, TN. He has served the Presbyterian Church USA in health care ministries and has a very strong background in health policy.

Needed: clarification of the nature of single payer approaches

Don, et. al.

I am convinced that the frequent caricature of the single payer health care financing as "government-run medicine" needs to be challenged on every level. It side-tracks and mis-describes the effect of a single payer approach.

For example, single payer approaches can involve multiple not-for-profit payer sources, such as Medicare/Medicaid, Blue Cross/Blue Shield, Tenn Care, and such efforts as the Mayo Clinic, Kaiser Permanente, Seattle Puget Sound and other regional or national efforts.

Using a regional budgeting approach, e.g. looking at the kind of services delivered by local and regional hospitals, a budget providing full funding for hospitals, minus the costs normally associated with collection and financing, would provide first rate care for a predetermined population. The hospitals would know what they would receive, receive incremental payments monthly for providing services, and thus be able to better serve the populations they have already been serving. The savings in billing costs and administrative costs could be re-directed into preventive health strategies...

Getting too detailed, but, for example, our MED, the regional hospital here--which not only serves western Tennessee, but also eastern Arkansas, northern Mississippi, the boot heel of Missouri and western KY--is frequently required to take in patients from those other jurisdictions in spite of the knowledge that, say, Mississippi will not reimburse the MED, the University of Tennessee or Tenn Care for the care. Because we are on the Mississippi, I-40/I-55, as well as being a major distribution center, we also have persons being served who come from far away. With regional funding, based upon patient load and acuity, such hospitals could render far better services.

My contention is that we spend far too much for health care without organizing it in such a way as to make the dollars make sense, health-wise. Regional strategies, tied in with revitalized health departments, NIH, the Centers for Disease Control, etc, would be
health-and-cost-effective. With the increase in global warming, the diseases such as West Nile Virus and expanding areas of malaria, AIDS, Ebola and others are going to require a much more effectively integrated health system to do the job that public health did in the early 1900s, in addition to providing the sophisticated technologies at reasonable prices.

We need to realize public profits on drugs that we helped fund, and the pharmaceutical industries charge excessively for. Brazil is an example, currently. The issue is also raising its head in southern Africa and else where.

Then, there is the fair return on investment on behalf of communities which have contributed the building of hospitals through a variety of means, including taxes. These are being bought up for a song by the health conglomerates to the detriment of many large and small community hospitals.

Health care is too important to the well-being of the nation to be left to the vagaries of the market place. It clearly does not increase services in places of greatest need. And the charges on advances in medical technology are outrageously high, and because of the paper trails created, there is rampant overcharging, duplication of charges and other waste.

I could go on. Sorry, didn't mean to get wound up. But, clearly, there are many options out there beyond the current waste of precious lives and resources. Doctors ought to be able to treat patients according to medical standards, with hospital and peer review. Not second-guessed by someone at a health maintenance organization who gets rewarded for denial of care...

Thanks for the ventilation opportunity...

Tom Mainor

Subject: John Foster responds to John Gilman

Even the best and brightest don't really get the skinny!

Spending more Federal dollars to "BUY SERVICES" simply invites drug companies and other vendors to get richer faster. Their prices will all go up.

But not in Medicare where the rules have evolved nicely over the many years, and cost increases have been moderate..

Only a single payer can control the cost of services, which is why, for example, Canadians get cheaper drugs.

Extending Medicare INCREMENTALLY would be a rational way towards a universal plan.

JOHN T. FOSTER(RETIRED ADMINISTRATOR)
Keene, NH

Subject: Susan Swan comments

Susan Swan, MSN, MPH, a Canadian, and currently a nurse practitioner in Atlanta, comments:

Re: Comments of Tom Mainor

In addition to Rev. Mainor's comments I think it should be pointed out that the single payer system in Canada is not "government run". Doctors are independent, fee for service practitioners. Hospitals are independently owned and operated - ie: we have Catholic hospitals, community hospitals, university hospitals etc. They are run by
voluntary boards of directors, not political appointee's. Lastly, we have to ask the question "Why is the government inherently incompetent"? This "incompetence" arises from the nature of bureaucracy. Any large, multi-layered institution is going to be
inefficient, government or "private". In fact, it is safe to say that most government bureaucracies pale in comparision to Blue Cross-Blue Choice's or Kaiser Permanente's of the world. The American myth that profit driven organizations are by nature well-oiled, finely tuned model's of efficiency must be must be dispensed with. Every bit of evidence points to the contrary. Profits don't influence efficiency and
have no place in healthcare.

March 06, 2001

Response of John Gilman, M.D., Health Policy Advisor to Senator Paul Wellstone:

"With this background, what are the current proposed solutions? Any form of universal, comprehensive reform is totally off the table." -- Don McCanne

Come on Don. Affordable universal health care may be off most of Washington's radar screens, but not ours. Senator Wellstone, Congresswoman Tammy Baldwin, and Congressman David Obey (along with Reps. Conyers, Baca, Carson, and Filner) introduced the Health Security for All Americans Act last year and will reintroduce it again this Spring. This bill would assure that all Americans have affordable comprehensive health care within 5 years of its enactment. It is supported by APHA, Families USA, AMSA, and SEIU. No, it is not a national single payer bill; but it does set the national parameters that states must meet in terms of benefits, quality and affordability, and it provides matching federal funds (on average 70% federal, 30% state) to allow states to adopt the system of their choice, including single payer. This is a practical and principled approach that is capable of putting universal health care back on the table. It deserves attention
and support from anyone concerned about reaching universal coverage.

The Washington Post
March 6, 2001
"Bush Urges Congress to Revamp Medicare"

President George W. Bush:

"I believe the framework for a bipartisan consensus about how to make sure the Medicare system fulfills its promise is at hand, and we've got a lot of work to do."

Comment: Medicare remains under intense attack. The Medicare "modernization" proposal of President Bush and the "bipartisan," anti-government members of Congress is simply a proposal to shift more
of the costs of Medicare away from the tax system and onto the Medicare beneficiaries. The current out-of-pocket expenses already impair access to care for our moderately low income retired and disabled population, simply because of lack of affordability. The "premium support" or "competitive premium" proposal will compound this problem for these lower income individuals. We need to protect and improve Medicare. We should not support the "generosity" of our leaders who would like to use Medicare to provide additional grist for the middlemen vultures of the health plans. We need to remind our leaders that vultures don't feed on
grist, they feed on carcasses.

Don McCanne
mccanne1@home.com

March 05, 2001

Drug access shouldn't be reliant on industry goodwill, but be ensured by law

Government is concerned that poor people's access to quality medicines is dependent on the goodwill of individual industry players. With the Medicines and Related Substances Control Amendment Act of 1997 - now tied up in a court battle initiated by the pharmaceutical industry - government wants to ensure its ability to provide medicines for all, for ever.

The latest SA Health Review 2000 - launched last Thursday - confirms that drug expenditure puts an unsustainable burden on state coffers as the HIV/AIDS pandemic claims more and more victims, and contributes most significantly to the inequality in access to healthcare between the private and public sector. "Public sector sales are expected to make up 24%, which translates to R59.36 per person not belonging to a medical aid scheme.ÊIn contrast, the per capita expenditure on prescription drugs in the private sector would be R800.29," according to the Review.

The total value of drug sales is anticipated to be R8.25 billion, according to figures released to the SA Health Review Team by the Pharmaceutical Manufacturers Association.

Background to the court case

Health Director-General Dr Ayanda Ntsaluba said in a press briefing at the weekend that he took part in the 1993 health expenditure analysis which found government was making a disproportionate allocation to drugs. This, says Ntsaluba, culminated in the now disputed Act.
In January 1998, Zuma met with the pharmaceutical industry, represented by the Pharmaceutical Manufacturers Association.

Government supports activists' role in court

The government on Monday expressed support for the Treatment Action Campaign becoming a party to the court case brought by pharmaceutical companies challenging legislation making provision for cheaper medicines.

"They have to deal with matters of life and death," MTK Moerane, counsel for the government, told the Pretoria High Court.

"It would be an injury not to admit them."

The Pharmaceutical Manufacturers' Association has brought an application against the state in opposition of certain sections of the Medicines and Related Substances Control Amendment Act, which it says infringes on patent rights. The PMA is acting on behalf of about 40 local and international drug companies.

The TAC, a lobby group campaigning for equal and affordable access to Aids drugs, applied to join the case as a "friend of the court' in support of the government.

Arguing in opposition to the TAC move, PMA counsel SA Cilliers said the court case was not specifically about access to medication for HIV or Aids patients.

At issue was the constitutionality of certain sections of the Act, not cheaper Aids drugs, he contended.

Judge President Bernard Ngoepe ruled that the PMA should go ahead with its arguments as if the TAC had been allowed to join the case.

The court was earlier adjourned for about 10 minutes due to repeated power failures. - Sapa

©2001. All rights strictly reserved.

Court hearing has global implications

AIDS Drug Test Case: World's Pharma Unions Back South Africa

ICEM Update, No. 10/2001, 5 March 2001

Countries must have the right to buy AIDS medication at an affordable price.

That call was issued in Copenhagen this morning by the leader of trade unions in the world's pharmaceutical industry.Ê

Fred Higgs, General Secretary of the 20-million-strong International Federation of Chemical, Energy, Mine and General Workers' Unions (ICEM), was speaking as a crucial court case opened in South Africa today.Ê

Developing countries' access to medication is at issue in the test case between the South African government and 39 big pharmaceutical companies.Ê

To protect their patents, the major drug corporations are asking the court to stop the implementation of a South African law aimed at providing cheaper medicines. The law would permit the country's health minister to use parallel importation of drugs, compulsory licensing and generic substitution (cut-price "copy" drugs) where necessary.

Application of this Act has already been delayed for several years by the legal wrangles. The measure is particularly important to the fight against HIV/AIDS in South Africa, which has one of the world's highest rates of HIV infection.Ê

"As part of the ICEM's programme to combat HIV/AIDS, we believe that South Africa and other countries must have the right to buy the appropriate pharmaceuticals at prices that they can afford," said Higgs this morning. He was in South Africa last week at an ICEM conference where African and Asian unions adopted a programme of action on HIV/AIDS.

"We hope that the South African courts will defend South Africa's rights in this regard," Higgs added. "We ask ICEM-affiliated unions to express their support for the South African government's position."Ê

ICEM affiliates include pharmaceutical workers' unions worldwide.

Higgs was speaking at the congress of the ICEM-affiliated Danish Women Workers' Union (KAD), which is celebrating its centenary this year. Over a thousand delegates are attending the congress.

Angry protests as companies start drug battle

The battle over South Africa's medicine legislation came to a head on two fronts in Pretoria on Monday - in the city streets and in the High Court.

As angry words flew when protesters demanding cheaper drugs delivered a memorandum, the court heard in legal argument that the issue was not about affordable and accessible drugs.

The crux of the matter was the constitutionality of the Medicines and Related Substances Control Amendment Act of 1997, the Pharmaceutical Manufacturers' Association (PMA) contended.

Representing about 40 local and international pharmaceutical companies, it wants the court to prevent the enforcement of the act.

'You are treating us with contempt' The PMA's legal representative Fanie Cilliers SC said certain sections of the act were unconstitutional. They were also in breach of the Patents Act and the country's international
obligations.

As the case got under way, thousands of protesters opposing the PMA court action gathered in Church Square about a block away.

The demonstration was organised by the Congress of SA Trade Unions, the Treatment Action Campaign (TAC), religious bodies and a range of other organisations.

After marching past the High Court building in Vermeulen Street, the protesters proceeded on a 5km walk to the United States embassy in Arcadia.

There they were upset when senior embassy official Robert Godec refused to walk through the crowd to receive a memorandum outlining their demands.

Cilliers opposed the joining of the TAC "You are treating us with contempt," Cosatu president Willie Madisha told Godec.

Madisha later made a brief appearance in the courtroom, where Cilliers argued that a section of the act gave the health minister the power to render lawful what the Patents Act rendered unlawful.

Another section, which provided for compulsory substitution of scheduled medicines by generic drugs, could be dangerous, and was in breach of property provisions in law, as well as the constitutional rights of equality and freedom of expression, he said.

At the start of Monday's proceedings, Cilliers opposed the joining of the TAC as "friend of the court" in support of the government.

M T K Moerane SC, for the government, expressed his support for the TAC joining them.

"We believe the clients they represent are at the sharp end of what we regard as the unreasonable conduct of the applicants. It would be an injustice not to admit them."

Cilliers requested time to consult his clients. The judge ruled that the matter should continue in the meantime as if TAC had been allowed to join. - Sapa

©2001. All rights strictly reserved.

Thousands march against drugs multinationals

Thousands of protesters marched from Pretoria's Church Square around 11am on Monday to the city's High Court where they picketed to show support for the government in its court battle against the Pharmaceutical Manufacturers' Association, a group which represents multinational drugs companies.

The pharmaceutical firms are approaching the court in a bid to stop the country importing cheaper generic medicines, including a cost-effective anti-AIDS "cocktail".

The marchers, filling the length of an entire street block, marched down Church and Bosman Streets on their way to the court in Vermeulen Street.

They were led by Pretoria's Catholic Archbishop George Daniel and Bishop David Beetge of the Anglican Church.

'We cannot allow them to succeed' Traffic officials, police and marshals were trying their best to keep the march orderly, and several city streets had been closed.

Before leaving Church Square, the protesters were led in prayer by religious leaders.

The marchers included members of the Congress of South African Trade Unions (Cosatu) , the African National Congress, the SA Communist Party, the Treatment Action Campaign, and other unions.

"We cannot allow them to succeed, and will continue our fight. If we don't do that it means that we allow people to die," Cosatu's president, Willie Madisha, said at the march.

Should the drugs firms win the case, Cosatu would approach the National Economic Development and Labour Council to push for procedures allowing the union to "mobilise around this as a socio-economic issue," he said.

Cosatu would also approach the Constitutional Court. - Sapa

©2001. All rights strictly reserved.

Low-cost insurance program can't keep healthy enrollment


San Diego Union Tribune
March 4, 2001
by Susan Duerksen

"Despite intense efforts to get all eligible children covered by Healthy Families insurance, children are dropping out of the federal program almost as fast as they sign up."

Comment: "Healthy Families" is California's version of the State Children's Health Insurance Program (S-CHIP). The leading proposals for incremental reform call for expanding eligibility under the S-CHIP program. In spite of significant efforts, California has fallen far short of being able to enroll all eligible individuals, and will never be able to because of the inherent nature of the administration of the S-CHIP program. The statement above suggests that California is approaching a steady state in enrollment, with children rotating in and
out of the program. Although S-CHIP should be supported as a temporary, urgent stop gap, it and all of the other incremental concepts can never address the real issues that face us. We have the resources to provide comprehensive care to everyone, but we have a system that is totally incapable of allocating our resources effectively. We will never have resolution of this issue until we make the decision to establish a publicly administered, universal risk pool.

March 04, 2001

Millions pin hope on drugs hearing by Anso Thom, Independent Online

The hopes of millions of South Africans and fellow Africans will be pinned on the outcome of the court case between 41 pharmaceutical companies and the government which starts in Pretoria today.

Led by the Pharmaceutical Manufacturers' Association (PMA) of South Africa, a trade association representing the research-based pharmaceutical industry, legal action was instituted against the government in February 1998 to defend the industry's patent rights.

Action on the part of industry is specifically aimed at Section 15C of the Medicines and Related Substances Control Amendment Act (No 90 of 1997), which - according to the PMA - allows for the "abrogation of all patent rights for any pharmaceutical upon ministerial discretion".

The department would 'defend this costly action to the fullest extent' It allows the government to buy drugs from countries where prices are already lower - thus trading in parallel with local sellers of the same drugs.

The PMA said the health department had argued in 1997 and 1998 that Section 15c was intended purely to enable the government to occasionally parallel-import a product it believed might be overpriced in South Africa.

PMA's chief executive officer Mirryena Deeb said the government had since announced that Section 15C was "model legislation designed to allow for compulsory licensing and parallel trade".

Director-general for health Dr Ayanda Ntsaluba said the department would "defend this costly action to the fullest extent because it is so fundamental to transforming South Africa's highly inequitable healthcare system" so that even the poorest sections of society benefited.

Jackie Achmat of the Treatment Campaign (TAC) confirmed that the activist group would apply today to join the case as a friend of the court.

'They have less to do with the manufacturing' "We believe the patents system as it stands is undermining the right of access to medicines. We're prepared to use the existing patent system, but would like to see an international body re-examine it and put healthcare above patent law. We need to find a way that people get rewarded for their efforts, but at the same time ensure there's no obstacle to making medicines more affordable."

When questioned on the high prices of their drugs, pharmaceutical companies blamed research and development costs for the high costs of innovator drugs.

But analysis of the top 12 drug manufacturers in America in 1999 showed that their median percentage of revenue dedicated to research and development was 12,4 percent, whereas a median of 34,3 percent was dedicated to marketing and administrative costs.

According to the SA Health Review, huge profits made by the pharmaceutical industry were another reason to question the need for high drug costs.

For the past 10 years, the pharmaceutical industry had been the most profitable in America, with median profit rates more than triple those of other leading companies.

Chief executive officers of the top 10 firms averaged about R80-million each in salaries in 1999, with stock options averaging another R80-million each.

"Drugs prices are therefore considered to a large extent to be managed by their manufacturers, rather than by the market, said the SA Health Review.

"They have less to do with the manufacturing and development costs of the particular product, and more to do with the characteristics of the market in which they are placed."

In another recent development, the United States has complained to the World Trade Organisation that Brazil's "local working" requirement in its patent law is in violation of the Agreement on Trade-related Aspects of Intellectual Property Rights, better known as TRIPS.

The US argues that the local working requirement gives the Brazilian government the power to issue compulsory licenses, or import either the patented product or the product obtained from the patented process, when companies fail to work their patents locally.

The local working requirement thus applies when drug companies import patented drugs rather than produce them locally, but only if the companies fails to show that it is not economically or legally viable to produce
locally.

©2001. All rights strictly reserved.

March 03, 2001

The Implications of the 2000 Election


This message is about a very subtle yet crucially important topic. It is long because it cannot be stated in a few words. I saved it for Saturday, since some will have time during the weekend to read it.

The New England Journal of Medicine
March 1, 2001
"Health Policy 2001"
by R.J. Blendon, D.E. Altman, J.M. Benson, and M. Brodie

Quote from article, with footnotes:

"We believe there is a reasonable chance that legislation representing a compromise between the Bush and Gore positions can be enacted that will help 4 million to 10 million of the nation's 43 million uninsured
persons receive coverage. Such legislation might make it possible for some employed but uninsured persons to obtain coverage through tax credits that would pay for part of the cost of private health insurance
policies. The availability of medical savings accounts might also be increased. In addition, self-employed persons might receive tax incentives to encourage them to purchase insurance. Complementing these
private-sector approaches would be an increase in funds for states to expand Medicaid coverage and the State Children's Health Insurance Program for persons with low incomes. The states could be given greater
discretion in determining how these two federal-state programs would be structured and administered."

Comment: No footnotes? What gives? This description af a political agenda for our health care system does not really need to be referenced with footnotes as long as it begins with, "We believe that..."

This quote is from the New England Journal of Medicine, a publication noted for its academic purity. The lead authors are Robert Blendon, Sc.D., Professor at the Harvard School of Public Health, and Drew Altman, Ph.D., President and CEO of the Kaiser Family Foundation, two of the most ethical and highly respected individuals that help to bring light on the problems inherent in our health care system. Let me state up front that in no way do I question the integrity of these icons for whom I have the most profound respect. I believe that the problem that I address is a very subtle one that has received very little consideration.

What is this that they state they believe? They believe that the leading proposals have a significant chance of enactment. They base their belief on scientifically valid surveys of the American public and on the opinion of those that now control the agenda by virtue of having been elected to office. These are very reasonable conclusions.

Robert Blendon and his colleagues have a well deserved reputation for capably assessing the opinions of the public on matters of applications of health policy. They and others have shown that Americans express
greater distrust in the ability of the government to meet our social needs, and that private solutions have increasing support. But Americans do believe that the government can have a significant role in meeting the needs of the more vulnerable members of our society.

With this background, what are the current proposed solutions? Any form of universal, comprehensive reform is totally off the table. It is nowhere in sight. Supporters of universal coverage such as Ron Pollack and Jim McDermott are now seeking solutions that are compatible with the background laid down by the studies of Blendon, et al. Ron Pollack of Families USA has joined with Chip Kahn of the Health Insurance Association of America to propose the Medicaid and S-CHIP expansions, along with tax credits, as mentioned in the "We believe" statement above. Democrat Jim McDermott and Republican Jim McCrery are proposing refundable tax credits as a compromise that might increase coverage of the uninsured.

There are serious problems with the proposals under consideration. Tax deductions and tax credits are not really health care legislation but really are tax proposals. Most of the benefit would accrue to those that already have health care coverage. Low income individuals do not benefit unless they are given a refundable tax credit that approximates the cost of health care coverage, an extremely unlikely prospect in the current political climate. Medical savings accounts are a favorite of conservatives since they benefit the healthy and wealthy, leaving out the sick and poor. Medicaid has been chronically underfunded and the S-CHIP program has Spartan benefits. Expanding these programs for low income individuals perpetuates muti-tiered health care. Legislation expanding the role of private health plans perpetuates the administrative waste and flawed health policy characteristic of these plans. Even if all of these proposals were adopted, at best we would still be leaving over three-fourths of the uninsured without coverage.

Every informed person agrees that we have enough resources to provide comprehensive care for everyone. A publicly administered, universal program would correct most of the defects in funding and allocating
health care In America. So why has this concept been totally rejected and kept out of public forums and press coverage of health care reform?

Simply, those that have control the agenda, whether the media, public forums, legislative hearings, or whatever, repeatedly cite the studies that show that Americans do not want the government involved in their
health care. Innumerable presentations in print, at forums, or wherever, specifically cite the Harvard University/Kaiser Family Foundation/Washington Post studies that confirm that concept. This perception is so pervasive that even Al Gore said, "We don't want one-size-fits-all," and Sen. Clinton supports the "small steps" of incrementalism. Consequently, all current proposals are limited to incremental expansions.

Although these polls demonstrate that anti-government rhetoric has permeated and molded the opinions of our society, do they show an accurate picture? Do Americans really want government out of their health care system? I often ask audiences, "How many here would like to see Medicare abolished and not replaced with any other program?" Rarely do any hands go up. If Medicare had been established as a universal program, I sincerely believe that the support would be the same, considering the great resources that we have that would be available to everyone.

When issues are carefully explained, then individuals make decisions based on their values rather than on the rhetoric. Unfortunately, the nation is poorly informed on the real issues involved. For instance the NEJM article contained the statement, "Two thirds or more of both Republicans and Democrats favor the use of tax credits to help the uninsured buy private health insurance." This response is expected. It really sounds like a good idea. But suppose, before you ask that question, you explain the issue. You point out that a tax credit proposal will have to be a bipartisan compromise. The Democrats will prevail in seeing that the tax credit is refundable so that it will provide cash to the low income individual to enable the purchase of health care coverage. The Republicans will prevail in insisting that the amount of the credit will be modest because "we cannot afford to pay for" a generous tax credit. Studies have confirmed that such a proposal will not be adequate to make coverage affordable for most of the uninsured, but it will provide a tax subsidy for the more affluent who already have insurance. Now, let's ask a more accurate question. Instead of asking, "Do you favor the use of tax credits to help the uninsured buy private health insurance?", let's ask, "Do you favor the
use of tax credits for purchasing private health insurance, a proposal that would provide a generous tax subsidy for the more affluent, and might allow a very limited number of lower income individuals to
purchase insurance?" I believe that the results would have been dramatically different. A very important question that we should ask ourselves is whether we should consider the opinions of Americans when
we make policy decisions, if those decisions are going to be based on perceptions of rhetoric rather than on a clear understanding of the fundamental issues involved.

The concept that I want to make clear is that these studies do not only show us where Americans believe they stand on health care reform, but they are also driving the political agenda for reform. I emphasize that
that these are opinions on where Americans believe they stand, but they are not opinions on where they would stand if they understood the full implications of the policy behind the rhetoric. The rhetoric is even influencing the pollsters. They are asking questions about private versus government. Is Medicare private or government? It is a publicly funded program that uses the private and public health care delivery
system. Such dual choice questions are frequently inappropriate.

The Harvard/Kaiser/WP poll asks, "Do you favor a national health plan, financed by taxpayers, in which all Americans would get their insurance from a single government plan?". There are many problems with the
phrasing of this inquiry, but the term "government" assures a negative response, based on reflexive rejection of the rhetorical implications, but not based on a comprehensive knowledge of the policy issues involved. Indeed, this one question has been used repeatedly to support the position that Americans do not want national health insurance (even though they do support Medicare.) It is being used to keep the consideration of comprehensive reform off of every agenda.

Polls could be designed that would ferret out the true values of Americans. Those are the polls that should be used to establish policy. The current polls, which are based more on rhetoric, are being used by each interest to further their own political agendas. In the case of health care, they are being used to dismiss, without
consideration, a rational, ethical approach to reform: a publicly administered, universal risk pool. In reforming health care, we need to understand the position of Americans, but their position on their values, not on their rhetoric.

Don McCanne
mccanne1@home.com

March 02, 2001

Blue Cross to offer new coverage


Ventura County Star
March 1, 2001


"Thousand Oaks-based Blue Cross of California announced a program this week aimed at enabling small businesses to subsidize employee health care coverage at defined rates."

"Under the program, employers pay a fixed dollar amount per employee per month toward the cost of health care coverage. Employees are responsible for costs above the employer's contribution."

Comment: So Blue Cross is creating a program that will make employee health insurance affordable for small employers who cannot afford (or have elected not to pay for) the costs of existing health plans. But what is happening here?

Blue Cross is the largest and one of the most successful insurers in California. They often set trends in insurance coverage. This plan is the first one of this nature, but we can expect other companies to follow.

Since the premium paid by the employer is the same for each employee regardless of age, number of dependents or other risk factors, this is a DEFINED CONTRIBUTION proposal. The dollar amount set by the employer will be as little as $80 per employee. Each employee can then chose from a menu of Blue Cross plans, the higher the level of benefits, the more expensive the plan. The greatest defect with defined contribution plans is that low income employees will be able to afford only bare bones coverage if even that. Defined contribution plans inevitably result in multiple tiers of health care, boutique medicine for high
income individuals and limited access and impaired outcomes for those with lower incomes.

Blue Cross, since converting to a for-profit company, has refined its business models for coverage. The traditional concept of a defined contribution plan is to allow the employee a given amount of funds to be used to select from a wide variety of health plans in the marketplace. Blue Cross has figured out a way to capture this under-served market by offering employers the advantage of a fixed contribution plan, but, at the same time, locking the employees into a menu of plans offered only by Blue Cross. Employers can assuage their guilt at a low cost,
employees will get only mediocrity but with significant out-of-pocket expenses, and Blue Cross will walk away with the dough.

Isn't it time that we dump these marketplace health plan parasites, and replace them with a publicly administered, universal risk plan?

March 01, 2001

Medicare at the Crossroads


The Economic Policy Institute
Paycheck Economics, Vol. 1, No. 4


"One attractive option that could provide insurance to the uninsured while maintaining high-quality care for those who have insurance is to expand Medicare to the entire population. The Medicare benefits package would first need to be fully modernized to include prescription drugs, preventive care, improved mental health and substance abuse services, and better cost sharing.

"There are advantages to this plan besides providing universal high-quality care. Having Medicare as a single insurer or "single payer" would greatly streamline the paperwork done by physicians, hospitals and other providers. Multiple investigators, from experts at the U. S. General Accounting Office to professors at Harvard University, have estimated that these savings would pay all the costs of providing insurance to the 44 million Americans without it.

" Not only would it be more efficient, but such a system would also help keep costs low, thus slowing the growth in future health care spending overall. An enhanced Medicare program for all Americans -"Medicare for All" - is the best way to provide universal high-quality health care."

Note: This excellent eight page analysis of Medicare explains the program, its problems, wrong solutions such as HMOs and vouchers, and the "right regimen for healing Medicare." It can be downloaded at: http://www.epinet.org/Paycheck/medicare.pdf