PNHP

Support for “hybrid” proposal?

Support for “hybrid” proposal?

Support for “hybrid” proposal?

Health Affairs
Web Exclusive
August 27, 2003

Americans’ Views Of The Uninsured: An Era For Hybrid Proposals Most agree that something should be done to help the uninsured, but they don’t want to pay higher taxes to do it.
by Robert J. Blendon, John M. Benson, and Catherine M. DesRoches

From the Discussion:
Although there is no public consensus on any single approach to helping the
uninsured get coverage, a hybrid plan-one that leaves workplace insurance in
place and includes elements of several different proposals to cover more of
the uninsured-offers the possibility of gaining public support.

Continuing reliance on workplace insurance will reassure those who already have such insurance that their coverage will not be at risk. The possibility of a compromise hybrid plan arises from the fact the large majorities of both.Democrats and Republicans are amenable to three different approaches to
covering the uninsured: some form of requirement that employers offer health
insurance to their employees, tax credits to buy private health insurance,
and expanding state government programs for low-income people to provide
coverage. With a hybrid plan, nearly everyone would get some element of
their preferred way to deal with the problem of the uninsured.

http://www.healthaffairs.org/WebExclusives/Blendon_Web_Excl_082703.htm

Comment: A hybrid proposal reminiscent of the Clinton plan, promising
something for everyone, brings back unpleasant memories of the disintegration of the legislative process when all special interests descended on Washington.
Words of optimism for reform escape me now.

Political feasibility of comprehensive reform

Health Affairs
Web Exclusive
August 27, 2003
The Politics Of Health Reform: Why Do Bad Things Happen To Good Plans? In the United States, the more desirable health care reform is on substantive grounds, the less politically feasible it is.
by Jonathan Oberlander

Abstract:

This paper examines political feasibility and its implications for health reform. I discuss the political obstacles to health reform in the United States, disentangling perennial barriers from contemporary constraints. I then explore major reform options and their political prospects. I argue that while incremental reform now appears to be the most feasible option, the political climate may change in a way that permits a bolder vision.

Moreover, incremental reform may not be sustainable in the long run,for the
same reason that makes it politically popular now: It does not change the
status quo in the health system.

http://www.healthaffairs.org/WebExclusives/Oberlander_Web_Excl_082703.htm

PDF format:
http://www.healthaffairs.org/WebExclusives/2206Oberlander.pdf

Comment: As I read this article to select the “Quote of the Day,” I was
overwhelmed with the number of possibilities. And I was concerned that the
individual provocative comments would distract readers from the extremely
important overall perspectives presented by Professor Oberlander.Therefore
I am distributing only the abstract.

This article should be read in its entirety by everyone who is dedicated to
reforming our health care system. Down load it and print it out (in the
PDF format for easier reading). It should become a part of your health policy
library.

Many doctors call for universal coverage in healthcare

Many doctors call for universal coverage in healthcare
Alexandra Marks (2003-08-13)

Think about it as Medicare for all, not just for the elderly.And not just the limited, cash-strapped program that makes headlines now, but an enhanced Medicare that covers prescription drugs and catastrophic care, as well as pays doctors a fair wage for their services. All of this for no more money than the country spends now on healthcare.

Sound too good to be true? Maybe. But for years, independent analyses from the Congressional Budget Office and private consulting firms have found a single-payer, national health-insurance system, however controversial politically, could do just that.

And Wednesday, noting that “the ‘health care mess’ is too real for anyone to ignore,” the prestigious Journal of the American Medical Association (JAMA) gave the medical world a jolt by publishing a proposal for a national health-insurance system that has been endorsed by more than 8,000 doctors. They include two former surgeons general.

Healthcare experts consider the move by the generally conservative journal to be one of the clearest signals yet that the US healthcare system is in need of an overhaul. While no one expects this particular US Congress to endorse a single-payer system, the JAMA decision does put the idea back on the map as a serious alternative.

“The thing is heating up, it really is,” Dr. Henry Simmons, president of the National Coalition on Health Care in Washington. “[Healthcare is] going to be the transcendent domestic issue in the next election.”

The editors at JAMA made it clear they aren’t necessarily endorsing the idea. But they consider the healthcare crisis so dire that all ideas have to be seriously explored.

The American Medical Association, the largest doctor organization in the country, immediately distanced itself from the article. It noted that while JAMA was associated with the AMA, it is editorially independent. Indeed, the AMA has had a long-standing policy opposing a single-payer system.

AMA President Donald Palmisano said that while a solution is “desperately needed” to cover the nation’s more than 40 million uninsured, a single-payer system is not the way to go.

“A single payer system would result in rationing of care, increased bureaucracy and stifling of innovation,” says Dr. Palmisano. “It would demoralize doctors and patients.”

Advocates of a single-payer national health system dispute that. They say patients would have more choice than they do now of doctors and hospitals, which would continue to be run privately under the system they’re proposing. And they contend the services received would be more comprehensive for a fraction of the cost.

Currently, about 26 cents on every US health care dollar is spent on paperwork and administration. Replacing private health insurance companies with a single, government insurer like Medicare, which spends about 3 percent on administration, would save the country $200 billion dollars annually.

“The single payer system is the only one that’s economically feasibly,” says Dr. Richard Brown, a member of Physicians for a National Health Program, which wrote the proposal featured in JAMA. “And of course it’s open, it doesn’t exclude people because they’re a bad health risk.”

Currently, the United States is the only major industrialized country that doesn’t provide some kind of universal coverage, even though it spends more than 14 percent of its GNP on healthcare. According to the World Health Organization, that’s more than any other in the developed world and yet it remains the only one with tens of millions of uninsured. The quality fo care in the United States also fares only modestly when compared with other countries. Out of 181 rated by the WHO in 2000, the US came in 35, just two slots above Cuba.

Single-payer advocates acknowledge it remains a very controversial idea in the United States. But they point out that in the last 10 years support has grown, even in places traditionally opposed. In a fact sheet, the Physicians for a National Health Program note that “More than half of academic physicians, including most medical school deans, now endorse single payer [national health insurance,] as do 40% of small business owners. Polls have long shown that a majority of Americans favor some form of [national health insurance].”

Most health policy experts, including Brown, believe it still could be many years before the country is ready politically to institute a single- payer system. Currently, health insurance is provided by a mix of private, employment based insurers and a government safety net for the poor, as well as full coverage for the elderly. Health insurance is a multi-billion dollar business, with a powerful lobby on Capital Hill.

“I don’t think right now we could move politically too far from that model,” says Kathleen Stoll, director of health policy at Families USA, nonprofit health care consumers advocacy group in Washington. “The problem is that there’s a tremendous hole between those that have coverage from their employers and those that are covered by the government.”

© Copyright 2003, Christian Science Monitor

Reality check on MSAs

They’re just another tax shelter, not health-care reform.
By Des Moines Register Editorial Board
08/25/2003

They’re back. Every few years, medical spending accounts (MSAs) are rolled out as an answer to problems in the health-care system. A provision to expand who can use these accounts has made its way into the Medicare reform being debated in Congress.

The concept is simple: Individuals can put money into savings accounts each year, tax free, and use that money to pay health-care bills out of pocket. If money is left over, the individual gets to keep it.

It’s appealing on the surface. Advocates argue the accounts are an incentive to “save money” by using less health care because people will think twice about “spending their own money.” Participants might pass on unnecessary tests. It’s an opportunity to inject a free-market principle into health care by allowing individuals to select their own doctors and negotiate rates for services.

Now back to the real world:

* Currently insurance companies and the government leverage down doctors” fees. It’s unlikely a single consumer, with no leveraging power, will be able to accomplish that. This is demonstrated over and over when the uninsured pay more than an insurance company does for the same service. People with these accounts could end up paying more.

* Medical spending accounts are another way to tax shelter money for the affluent. Low-income people will not have the extra dollars to stow away in a savings account. Yet higher-income people will be able to let this money build for years, investing it in stocks and bonds to grow tax free.

* Medical spending accounts will appeal to healthy people because they don’t use many medical services and therefore would get to pocket the unspent balance in their accounts. However, the core concept of insurance is pooling the sick and healthy together to balance out the risk. Widespread use of spending accounts could leave a higher proportion of sick people in insurance pools and result in higher premiums for that group.

* Individuals skipping a checkup or opting not to go to the dentist a few times won’t make even a small dent in the health-care spending of this country. The vast majority of spending on health care is done for the few sick and elderly individuals. MSAs won’t change that.

A special-interest radio ad currently playing in Iowa states: “President Bush supports making MSAs available to all Americans, but Senators Ted Kennedy and Hillary Clinton are against it. They want the government to run our health-care system. But Senator Charles Grassley can make the difference. . . . Tell him to keep fighting for the uninsured by making MSAs available to all Americans.”

What do “national health care” and “Hillary Clinton” have to do with spending accounts? And a tax-free account doesn’t “fight for the uninsured” who likely don’t have the money to invest in one of these plans anyway.

The ads are disingenuous. After all the hype is stripped away, it’s clear medical spending accounts don’t render people “insured.” They simply disguise another tax shelter for the affluent while peddling it as something for the average person.

Montpelier Doctor Calls For Universal Health Care

Montpelier Doctor Calls For Universal Health Care
By JAN NEWPHER, City Editor
Friday August 22, 2003

LYNDONVILLE VT- The ever-rising cost of health care is fast becoming a common topic of conversation as the baby boomer generation ages. Participating in the conversation are people advocating what they believe are solutions.

One suggestion is adopting a single-payer universal health-care system administered by the government, a system used by many other countries including Canada.

An advocate of this solution is Dr. Deborah Richter, a Montpelier family practitioner who at one time served as president of Physicians For A National Health Plan and is now a representative of Vermont Health Care For All, a Montpelier-based tax-deductible, nonpartisan organization providing information and news about health care.

Richter, co-author of “Heath Care From A Different Perspective,” a March 2003 position paper, spoke to the Lyndonville Rotary Club Wednesday at the First Congregational Church in Lyndonville. She came armed with facts and figures supporting her position for a universal health-care system.

She told the Rotarians she got her start in learning about health care in the inner city of Buffalo, N.Y., where many people had no health coverage at all. It is “a real atrocity,” not having health care, she said.

One thing we are doing wrong is looking at coverage rather than at services provided, she said. Vermont is a good state to look at coverage because it reflects pretty closely the national experience.

Citing information from a summary of the Lewin Group’s 2001 analysis of health care in Vermont, a study commissioned by the state, Richter said more than 70 percent of our health-care dollars is spent on health-care infrastructure which in Vermont consists of 14 hospitals, 44 nursing homes, 1,300 physicians, 10,000 nurses, 17,000 health-care workers and more. The structure is there whether we use it or not and its cost is fixed – 84 percent for hospitals for example, and 70 percent overall.

Eighty percent of Vermont’s population at any one single time uses only 15 percent of the available health care, while a major share of the heath care is used by only 10 percent of the population, many over the age of 65.

Since health services have such high fixed costs, she said, it makes sense to tailor the size of the infrastructure to what is actually needed. These actual needs should be determined and paid for collectively – by the whole population of Vermont.

For example, 7 percent of Vermonters have diabetes and 25 percent have high blood pressure. Services right now expand to meet the need and when people cannot pay, costs are shifted onto people who can pay – the hospitals raise their rates to cover their losses. But rates cannot be raised forever, she pointed out. We should pay for health care like we pay for roads – with everyone shouldering the cost because everyone benefits.

Trying to get the marketplace to lower costs, by bringing in more insurance companies to compete with each other just won’t work, she said. Health care is not a commodity. Insurance companies understandably want to insure only the healthy, but how do we pay for the people who are sick? Health care for a premature baby can cost as much as $500,000. Under universal health care everyone pays for that baby and no one is turned away.

Some universal health-care systems are better than others and the people under those systems collectively determine what they will and will not pay for, Richter said. For example, in England, people over the age of 65 needing dialysis are not covered. That may not be what we would want in Vermont.

Vermont can shape its own system. Some procedures would not be accepted. For example, bone marrow transplants in the treatment of breast cancer did not prove effective. We may not want to cover circumcision and cochlear implants for hearing, Richter said. People may object to these decisions and they will be debated, and decided upon collectively.

Rationing of services would eventually have to be done to contain costs, Richter’s paper states. The Lewin Group Report indicates chiropractic services would be covered when referred by a physician. Preventive dental care and eye exams would be covered but not orthodontia, eyeglasses and private hospital rooms.

But health care in effect is rationed now – by affordability and decisions made by the insurance companies about what they will and will not cover.

Administrative costs currently account for 24 percent of the health care dollar. Much of this money can be redirected toward patient care if the wasteful duplication by a multiplicity of insurance companies is eliminated. The Lewin Report indicates a single risk pool of 600,000 people for Vermont would save more than $100 million in the first year.

Medicaid and Medicare payments from the federal government can be redirected into one fund and the costs would be further subsidized by a 5.8 percent payroll tax paid by employers and a 2.9 percent payroll tax on employees. There also would be a co-payment by users of $10 for most services.

Costs would be controlled by a global budget determined by a committee of skilled professionals, Richter said. She was not in favor of a co-payment by users, but if it meant the adoption of a universal health-care system she would accept it.

The two other co-authors of Richter’s paper are nurse practitioner Marilyn Rothwell and Terry Doran.

Dr. Richter and Vermont Health Care For All can be contacted through its Web site at www.vthca.org, or at 802-224-9037.

First 1000 Iraqi veterans allowed to purchase discount

Market Wire
08/25/2003

eHealthInsurance and The Veterans Corporation Offer Discounted HealthCare
Assistance to Veterans In Honor of Those Who Have Served in Operation Iraqi Freedom

In support of Operation Iraqi Freedom Veterans and American men and
women deployed in the U.S. Armed Forces around the world, eHealthInsurance,
the nation’s leading online source for individual, family and small business
health insurance, and The Veterans Corporation are providing an assistance
program for Veterans to help them save money on health care while they re-establish civilian health insurance coverage. Honoring those who have reserved and continue to serve in Iraq, the first 1000 Veterans who buy an eHealth Savings Card from The Veterans Corporation website at www.veteranscorp.org will have access for themselves and their immediate family to its discounts and services at 50 percent off the retail price for up to six months.

“Many of the servicemen and women serving in Iraq are coming back to an
environment where they may be without health insurance for a time,” said
retired Army Maj. Gen. Chuck Henry, president and CEO of The Veterans
Corporation.

The eHealth Savings Cards are non-insurance products from eHealthInsurance,
which also gives Veterans Corporation members access to over 4000 health
insurance products nationwide. eHealth Savings Cards provide consumers
with discounts of up to 60 percent at over 400,000 healthcare providers around
the country, including physicians, dentists, vision care specialists and pharmacies. Veterans who participate in this program through The Veterans
Corporation can choose the one card that best meets their needs from
the four eHealth Savings Cards that are available — Dental, Pharmacy(which
also includes vision services), Health Savings (which includes pharmacy,dental and vision services) and Medical Savings (which includes pharmacy,dental, vision and physician services.)

Gary Lauer, CEO of eHealthInsurance:

“We are pleased to be able to honor these American heroes who were involved
with the conflict in Iraq by easing their transition back into civilian life.”

http://www.marketwire.com/mw/release_html_b1?release_id=56789

Comment: Shouldn’t the returning “Operation Iraqi Freedom Veterans” be provided greater health security than the mere opportunity to purchase a
discount card? For that matter, shouldn’t all residents of our great nation be provided the health and financial security that’s only possible with a universal system of health insurance?

Discounted discount cards! For shame!

Important new data on administrative costs

Date: Thu, 21 Aug 2003 05:33:22 -0700
Subject: qotd: Important new data on administrative costs

Public Citizen
The Health Research Group
August 20, 2003
The Cost (of Health Care Administration) to the Nation, the States and the District of Columbia, with State-Specific Estimates of Potential Savings By David U.Himmelstein, M.D., Steffie Woolhandler, M.D., M.P.H. and Sidney M. Wolfe, M.D.

Executive Summary
The U.S. wastes more on health care bureaucracy than it would cost to provide health care to all of the uninsured. Administrative expenses will consume at least $399.4 billion out of total health expenditures of $1,660.5 billion in 2003. Streamlining administrative overhead to Canadian levels would save approximately $286.0 billion in 2003, $6,940 for each of the 41.2 million americans who were uninsured as of 2001. This is substantially more than would be needed to provide full insurance coverage.

These results are derived from detailed data on administrative costs in the U.S. and Canada in 1999 which appears in tomorrow’s (Aug. 21, 2003) New England Journal of Medicine. This report updates the New England Journal estimates of nationwide administrative spending and potential savings to 2003. The complex and fragmented payment structure of the U.S. health care system increases administrative overhead in the U.S. relative to Canada,where a single-payer national health insurance program has existed since 1971.

The cost of excess health bureaucracy to the states is equally striking.(The breakdown for each state is listed in a table in the article,which can be accessed at the link listed.)

Only a single payer national health insurance system could garner these massive administrative savings, allowing universal coverage without any increase in total health spending. Because incremental reforms necessarily preserve the current fragmented and duplicative payment structure they cannot achieve significant bureaucratic savings.

Editorial opinions support challenge of Physicians' Proposal

Date: Wed, 20 Aug 2003 10:23:15 -0700
Last week, the publication of the physicians’ proposal for single-payer national health insurance in The Journal of the American Medical Association(JAMA) was extensively covered by the media. A JAMA editorial called for a resumption of the debate on reform, specifically to either support this proposal or come up with something better. This week, the anticipated editorial and op-ed responses are appearing. Today’s Kaiser Daily Health Policy Report provides a selection of these. The message that the nation must support this model or find something better has clearly resonated with editorial boards and op-ed writers.

Kaiser Daily Health Policy Report
August 20, 2003
Editorials, Opinion Pieces Examine Debate Over Single-Payer Health System
Several recent editorials and opinion pieces have examined a proposal introduced last week by the Physicians for a National Health Program under
which the federal government would become the single payer for health insurance in the United States to provide universal coverage for U.S. residents. Under the proposal, the government would cover the cost of health insurance for U.S. residents, but delivery of health care in large part would remain under private control (Kaiser Daily Health Policy Report,8/15). Summaries of the editorials and opinion pieces appear below.

Editorials
Asbury Park Press: Although the single-payer system proposed by the physicians “may not be the solution,” a “new approach is needed,” a Press editorial states. The managed care system, which was promoted in the early 1990s as a solution to rising health care costs and diminishing patient choices, “failed to deliver,” the Press writes. The editorial concludes, “The system is sick. … It’s time for Congress to look for another cure”(Asbury Park Press, 8/17).

Daytona Beach News-Journal: The attempt of the Clinton administration to
enact a universal coverage plan in the early 1990s will provide “valuable
guidance for the next attempt” at covering all U.S. residents, a News-Journal editorial states. At that time, doctors, the insurance industry and lawmakers “spent most of their energy picking at details,” and the proposal’s failure was a “death of a thousand cuts, most of them inflicted by … friends of universal coverage,” the editorial states. According to the News-Journal, before “delving into the details” of the structure of universal coverage, supporters of such a system should “build a strong coalition” and then develop a “national consensus supporting every American’s right to health care.” The editorial concludes, “Without that foundation, the next attempt is likely to dissolve into another circular firing squad” (Daytona Beach News-Journal, 8/18).

Des Moines Register: The nation’s current health care system “doesn’t work
optimally for anyone,” a Register editorial states. According to the Register, U.S. residents are paying higher insurance premiums, employers are paying more to provide coverage to employees and 41 million people do not have health insurance, with “millions more underinsured.” The editorial concludes, “Leaving one-sixth of the country’s residents without access to health care is wrong. Now, a group of doctors thinks so, too” (Des Moines Register, 8/20).

Newark Star-Ledger: It is “time to renew the debate about creating a national health insurance plan,” a Star-Ledger editorial states, adding that the Clinton administration’s effort to establish a national health care program “failed to deliver” and “seemed to sap our national will” to create a universal care system. Still, “chronic failings and frustrations” with the nation’s current health care system affect patients, doctors, employers and lawmakers, the Star-Ledger writes. The editorial concludes, “That is why this nation … must regain faith in its ability to design a national health care program that works” (Newark Star-Ledger, 8/18).

Raleigh News & Observer: The physicians’ proposal is a “good start,” a News & Observer editorial states. Although “[s]uch a sweeping step would deserve vigorous debate,” the proposal’s “basic principles are sound,” according to the News & Observer. The editorial contends, “Comprehensive health care is something to which Americans should be entitled,” adding, “The 8,000 doctors and medical students who endorse universal health coverage for Americans uphold the best traditions of their care-giving profession” (Raleigh News & Observer, 8/18).

Tennessean: The physicians “may not have the ideal proposal for health care,
but it certainly has issued a challenge to the Bush administration, presidential contenders and members of Congress,” according to a Tennessean editorial. Opponents of the proposal “must acknowledge” that over the”decade of silence on health care,” health care costs have increased,the number of uninsured individuals has increased and racial disparities in health care have “become more pronounced,” the editorial states(Tennessean,8/18).

Opinion Pieces
Dr. Murray Katz, Arizona Daily Star: Medicaid, which since 1965 has”expanded to cover needs no other program could,” is the only federal program that has the “capacity to morph into national health insurance,” Katz, a professor internal medicine and physiology at the University of Arizona College of Medicine, writes in a Daily Star opinion piece. He concludes that “we’ll be richer once all our fellow citizens have equal access to health care, and we can join the world as the last nation to do what is sensible and right” (Katz, Arizona Daily Star, 8/16). (Don’s comment:Although, because of chronic underfunding of the Medicaid program,some would cringe at the suggestion that Medicaid be used as a model for reform, Dr. Katz’s point is that Medicaid provides truly comprehensive benefits and is administered on the state level, both goals of a single payer system.)

Myriam Marquez, Orlando Sentinel: Public health care systems “aren’t perfect,” but the United States under a private health care system “spends more than twice as much on health care services than … all other developed nations” and has “tens of millions of uninsured” residents, Marquez, a Sentinel columnist, writes in an opinion piece. “The GOP philosophy that government can do little right and that business can do little wrong” will not lead to a “substantive” proposal to reduce health care costs or expand health insurance, Marquez writes (Marquez, Orlando Sentinel, 8/17).
http://www.kaisernetwork.org/daily_reports/rep_hpolicy.cfm#19461

Editorial opinions support challenge of Physicians’ Proposal

Date: Wed, 20 Aug 2003 10:23:15 -0700
Last week, the publication of the physicians’ proposal for single-payer national health insurance in The Journal of the American Medical Association(JAMA) was extensively covered by the media. A JAMA editorial called for a resumption of the debate on reform, specifically to either support this proposal or come up with something better. This week, the anticipated editorial and op-ed responses are appearing. Today’s Kaiser Daily Health Policy Report provides a selection of these. The message that the nation must support this model or find something better has clearly resonated with editorial boards and op-ed writers.

Kaiser Daily Health Policy Report
August 20, 2003
Editorials, Opinion Pieces Examine Debate Over Single-Payer Health System
Several recent editorials and opinion pieces have examined a proposal introduced last week by the Physicians for a National Health Program under
which the federal government would become the single payer for health insurance in the United States to provide universal coverage for U.S. residents. Under the proposal, the government would cover the cost of health insurance for U.S. residents, but delivery of health care in large part would remain under private control (Kaiser Daily Health Policy Report,8/15). Summaries of the editorials and opinion pieces appear below.

Editorials
Asbury Park Press: Although the single-payer system proposed by the physicians “may not be the solution,” a “new approach is needed,” a Press editorial states. The managed care system, which was promoted in the early 1990s as a solution to rising health care costs and diminishing patient choices, “failed to deliver,” the Press writes. The editorial concludes, “The system is sick. … It’s time for Congress to look for another cure”(Asbury Park Press, 8/17).

Daytona Beach News-Journal: The attempt of the Clinton administration to
enact a universal coverage plan in the early 1990s will provide “valuable
guidance for the next attempt” at covering all U.S. residents, a News-Journal editorial states. At that time, doctors, the insurance industry and lawmakers “spent most of their energy picking at details,” and the proposal’s failure was a “death of a thousand cuts, most of them inflicted by … friends of universal coverage,” the editorial states. According to the News-Journal, before “delving into the details” of the structure of universal coverage, supporters of such a system should “build a strong coalition” and then develop a “national consensus supporting every American’s right to health care.” The editorial concludes, “Without that foundation, the next attempt is likely to dissolve into another circular firing squad” (Daytona Beach News-Journal, 8/18).

Des Moines Register: The nation’s current health care system “doesn’t work
optimally for anyone,” a Register editorial states. According to the Register, U.S. residents are paying higher insurance premiums, employers are paying more to provide coverage to employees and 41 million people do not have health insurance, with “millions more underinsured.” The editorial concludes, “Leaving one-sixth of the country’s residents without access to health care is wrong. Now, a group of doctors thinks so, too” (Des Moines Register, 8/20).

Newark Star-Ledger: It is “time to renew the debate about creating a national health insurance plan,” a Star-Ledger editorial states, adding that the Clinton administration’s effort to establish a national health care program “failed to deliver” and “seemed to sap our national will” to create a universal care system. Still, “chronic failings and frustrations” with the nation’s current health care system affect patients, doctors, employers and lawmakers, the Star-Ledger writes. The editorial concludes, “That is why this nation … must regain faith in its ability to design a national health care program that works” (Newark Star-Ledger, 8/18).

Raleigh News & Observer: The physicians’ proposal is a “good start,” a News & Observer editorial states. Although “[s]uch a sweeping step would deserve vigorous debate,” the proposal’s “basic principles are sound,” according to the News & Observer. The editorial contends, “Comprehensive health care is something to which Americans should be entitled,” adding, “The 8,000 doctors and medical students who endorse universal health coverage for Americans uphold the best traditions of their care-giving profession” (Raleigh News & Observer, 8/18).

Tennessean: The physicians “may not have the ideal proposal for health care,
but it certainly has issued a challenge to the Bush administration, presidential contenders and members of Congress,” according to a Tennessean editorial. Opponents of the proposal “must acknowledge” that over the”decade of silence on health care,” health care costs have increased,the number of uninsured individuals has increased and racial disparities in health care have “become more pronounced,” the editorial states(Tennessean,8/18).

Opinion Pieces
Dr. Murray Katz, Arizona Daily Star: Medicaid, which since 1965 has”expanded to cover needs no other program could,” is the only federal program that has the “capacity to morph into national health insurance,” Katz, a professor internal medicine and physiology at the University of Arizona College of Medicine, writes in a Daily Star opinion piece. He concludes that “we’ll be richer once all our fellow citizens have equal access to health care, and we can join the world as the last nation to do what is sensible and right” (Katz, Arizona Daily Star, 8/16). (Don’s comment:Although, because of chronic underfunding of the Medicaid program,some would cringe at the suggestion that Medicaid be used as a model for reform, Dr. Katz’s point is that Medicaid provides truly comprehensive benefits and is administered on the state level, both goals of a single payer system.)

Myriam Marquez, Orlando Sentinel: Public health care systems “aren’t perfect,” but the United States under a private health care system “spends more than twice as much on health care services than … all other developed nations” and has “tens of millions of uninsured” residents, Marquez, a Sentinel columnist, writes in an opinion piece. “The GOP philosophy that government can do little right and that business can do little wrong” will not lead to a “substantive” proposal to reduce health care costs or expand health insurance, Marquez writes (Marquez, Orlando Sentinel, 8/17).
http://www.kaisernetwork.org/daily_reports/rep_hpolicy.cfm#19461

Administrative Costs in Market-Driven U.S. Health Care System Far Higher Than in Canada's Single-Payer System

EMBARGOED UNTIL: 5 PM EDT, AUGUST 20, 2003

Contact: Steffie Woolhandler, M.D., M.P.H � (518) 794-8109
David U. Himmelstein, M.D. � (cell) (617) 312-0970; (hospital office) (617) 665-1032
Sidney M. Wolfe, M.D. � (202) 588-1000

To read the full report please click here

Administrative Costs in Market-Driven U.S. Health Care System Far Higher Than in Canada�s Single-Payer System, New Research Shows With National Health Insurance, United States Could Cover the Uninsured

WASHINGTON, D.C. � Bureaucracy in the health care system accounts for about a third of total U.S. health care spending � a sum so great that if the United states were to have a national health insurance program, the administrative savings alone would be enough to provide health care coverage for all the uninsured in this country, according to two new studies.

The studies illustrate the failure of the private, fragmented and business-oriented U.S. health care system to control administrative costs, as compared to Canada�s single-payer system. One of the studies, in seeking to answer whether the ascendancy of computerization, managed care and more businesslike approaches to health care have decreased administrative costs, answers the question with a resounding �no.�

The second study provides a state-by-state breakdown of savings each state could achieve if the United States adopted a national health insurance program.

�Hundreds of billions are squandered each year on health care bureaucracy, more than enough to cover all of the uninsured, pay for full drug coverage for seniors, and upgrade coverage for the tens of millions who are under-insured,� said Dr. Steffie Woolhandler, co-founder of Physicians for a National Health Program and lead author of the studies. �Americans spend almost twice as much per capita on health care as Canadians, who have universal coverage and live two years longer. The administrative savings of national health insurance make universal coverage affordable.�

New England Journal of Medicine Study Shows U.S. Health Care Paperwork
Cost $294.3 Billion in 1999, Far More Than in Canada

The first study, which is to be published Thursday in The New England Journal of Medicine, finds that health care bureaucracy cost U.S. residents $294.3 billion in 1999. The $1,059 per capita spent on health care administration was more than three times the $307 per capita in paperwork costs under Canada�s national health insurance system. Cutting U.S. health bureaucracy costs to the Canadian level would have saved $209 billion in 1999, researchers found. [The study was conducted with grant support from the Robert Wood Johnson Foundation. The Foundation does not endorse the analyses or findings of this report or those of any other independent research projects for which it provides financial support.] The study, the most comprehensive analysis to date of health administration spending, was conducted by researchers at Harvard Medical School and the Canadian Institute for Health Information, Canada�s quasi-official health statistics agency. The authors analyzed the administrative costs of health insurers, employers� health benefit programs, hospitals, nursing homes, home care agencies, physicians and other practitioners in the United States and Canada. They used data from regulatory agencies and surveys of doctors, and analyzed Census data and detailed cost reports filed by tens of thousands of health institutions in both nations.

The authors found that bureaucracy accounted for at least 31 percent of total U.S. health spending in 1999 compared to 16.7 percent in Canada. They also found that administration has grown far faster in the United States than in Canada. Between 1969 and 1999, administrative and clerical personnel in the United States grew from 18.2 percent to 27.3 percent of the health work force. In Canada, those personnel grew from 16 percent in 1971 to 19.1 percent in 1996.

Harvard/Public Citizen Report Finds National Health Insurance Would Save $286 Billion on Administration in 2003 – Enough to Cover All Uninsured and Seniors� Drug Costs

The researchers also released a second report co-authored with Dr. Sidney Wolfe, director of Public Citizen�s Health Research Group. This report, based on data adjusted to reflect estimates of 2003 spending, found that health bureaucracy now consumes at least $399.4 billion annually and that national health insurance could save about $286 billion in administrative costs. This is equivalent to $6,940 for each of the 41.2 million people uninsured in 2001 (the most recent figure available for the uninsured). In addition to providing health coverage for the uninsured, these savings could provide drug coverage for the nation�s seniors.

The researchers found wide variation among states in the potential administrative savings available per uninsured resident. Texas, with 4.96 million uninsured (nearly one in four Texans), could make available $3,925 per uninsured resident if a national health plan were implemented. Massachusetts, which has very high per capita health administrative spending and a relatively low rate of uninsured, could make available $16,453 per uninsured person.

The high U.S. administrative costs can be attributed to three factors. First, private insurers have high overhead in both nations but play a much bigger role in the United States than in Canada. Second, doctors and hospitals in the United States must deal with hundreds of different insurance plans (at least 755 in Seattle alone), each with different coverage and payment rules and referral networks that must be tracked. In Canada, doctors bill a single insurance plan, using a single simple form, and hospitals receive a lump sum budget.

�Only national health insurance can squeeze the bureaucratic waste out of health care and use the money to give patients the care they need,� said Dr. David Himmelstein, co-founder of Physicians for a National Health Program and lead author of the studies. �Republicans are pushing to move seniors into HMOs, whose overhead is three times higher than Medicare�s. National health insurance could cover everyone without any increase in costs.�

Added Wolfe, �These data should awaken governors and legislators to a fiscally sound and humane way to deal with ballooning budget deficits. Instead of cutting Medicaid and other vital services, officials could expand services by freeing up the $286 billion a year wasted on administrative expenses. In the current economic climate, with unemployment rising, we can ill afford massive waste in health care. Radical surgery to cure our failing health insurance system is sorely needed.�

Drs. Woolhandler and Himmelstein are co-founders of Physicians for a National Health Program, a 10,000-member organization that advocates for Canadian-style national health insurance in the United States. Public Citizen is a non-profit, member-supported, consumer advocacy organization.

Insurers provide a "price point" for everyone

American Medical News
Aug. 25, 2003
Insurers post robust profits for the second quarter
By Robert Kazel
Springtime brought a bumper crop of profits for most of the nation’s large,investor-owned HMOs, and several even reported record-breaking financial
results for the second quarter.
Just about all of the leading health care payers met or surpassed their stated profit goals by raising premiums, redesigning products to shift costs to patients and cutting overhead. All insurers also benefited from an apparent decrease in medical cost acceleration.
Insurers are increasing profits as they learn how to succeed in tailor-making health plans to employers, which today typically means selling companies budget-minded products that require patients to pay more,said Ken Abramowitz, an analyst with the Carlyle Group, a New York investment firm.
“In the old days these companies used to sell one HMO at one price point, and the client would buy or didn’t buy,” he said. “Now there is a broad [range] of products and prices. There is a price point for everyone.”
http://www.ama-assn.org/sci-pubs/amnews/pick_03/bisc0825.htm
Comment: Now there is “a price point for everyone.”
Private health plans have ratcheted down rates for providers, wringing that sponge dry. They have pushed up premiums for employers and otherpurchasers
to the maximum tolerated. That leaves only the patient as the source of increased health plan net revenues. By reducing benefits and increasing cost
sharing, the insurers are able to create a “price point” that may appear to be affordable for moderate and low income individuals, but it purchases a Swiss cheese product that is marketed in yet smaller and smaller packages.
And it can only get worse. The tragedy is that most proposals for reform continue to use these evolving plans in the health care marketplace as the basis for reform. What good does it do to have “universal” coverage if the plans fail to make health care affordable for the individual with significant health care needs?
Our policymakers urgently need to shift from policies that protect and
nurture the private health plans to policies that would ensure affordable, comprehensive coverage for everyone. The Physicians’ Proposal (JAMA, Aug.13) would do just that.