The U.S. Health System: The Rest Of The Story

By John Goodman
Health Affairs Blog
March 19, 2009
Here is a paper (link below) with as many as 100 references that you almost never see cited in Health Affairs, or in the Journal of the American Medical Association (JAMA), or in the New England Journal of Medicine (at least not in their public policy articles). In fact, if you are a regular reader of these publications, I think you are going to be very surprised.
My colleagues Linda Gorman, Devon Herrick, Robert Sade and I discovered that public policy articles in the leading health journals (especially the health policy journals) tend to cite poorly done studies over and over again in support of two propositions: (1) Our health care system needs radical reform and (2) the reform needs to be modeled along the lines of the systems of other developed countries. At the same time, these articles tend to ignore contravening studies that are often published in economics journals and subject to much more rigorous peer review.
In our rest-of-the-story literature review, we focus on eight questions:
1. Does the United States spend too much on health care?
2. Are U.S. outcomes no better and in some respects worse than those of other nations?
3. Is the large number of uninsured in the U.S. a crisis?
4. Does lack of health insurance cause premature death?
5. Are medical bills causing bankruptcy?
6. Are administrative costs higher for private insurance than public insurance?
7. Are low-income families more disadvantaged in the U.S. system?
8. Can the free market work in health care?

John Goodman says that he wants us to hear the rest of the story, but then he doesn’t tell it to us.
He and his colleagues have pieced together a document using classic Goodman rhetorical deceptions. They pull out of the literature isolated items that support their position without identifying them as exceptions to the great body of information available in the health policy literature. They repeat the use of many studies that have been discredited as manipulations or distortions based on libertarian ideology, even though they are aware of the highly credible challenges to those reports. They use silly diversions to attack some of the most solid and important studies in the health policy literature. Patching these deceptions together creates magical conclusions that would seem to refute the most fundamental principles that can be gleaned from a couple of decades of solid health policy science research.
Using health policy reports retrieved from the refuse bin, they then end with the conclusion that we should adopt their favored proposal for reform, health savings accounts, a non sequitur to the specious arguments they have presented. Even though the policy community has dismissed HSAs as a serious response to the tragic dysfunction of our health care system and its financing mechanisms, the authors persist in abandoning their academic purity in pushing their cause.
“The Rest of the Story” might appeal to ideologues, but it is repulsive to those of us who are outraged by the the physical suffering and financial hardship faced by the millions of U.S. residents who are victims of a flawed financing system, unable to afford or receive the care that they need in a $2.5 trillion health care industry.
http://healthaffairs.org/blog/2009/03/19/the-us-health-system-the-rest-of-the-story/comment-page-1/#comment-24954
Paper on health care reform by John Goodman et al:
http://www.ncpa.org/pdfs/sp_Do_Other_Countries_Have_the_Answers.pdf

By John Goodman
Health Affairs Blog
March 19, 2009

Here is a paper (link below) with as many as 100 references that you almost never see cited in Health Affairs, or in the Journal of the American Medical Association (JAMA), or in the New England Journal of Medicine (at least not in their public policy articles). In fact, if you are a regular reader of these publications, I think you are going to be very surprised.

My colleagues Linda Gorman, Devon Herrick, Robert Sade and I discovered that public policy articles in the leading health journals (especially the health policy journals) tend to cite poorly done studies over and over again in support of two propositions: (1) Our health care system needs radical reform and (2) the reform needs to be modeled along the lines of the systems of other developed countries. At the same time, these articles tend to ignore contravening studies that are often published in economics journals and subject to much more rigorous peer review.

In our rest-of-the-story literature review, we focus on eight questions:

1. Does the United States spend too much on health care?

2. Are U.S. outcomes no better and in some respects worse than those of other nations?

3. Is the large number of uninsured in the U.S. a crisis?

4. Does lack of health insurance cause premature death?

5. Are medical bills causing bankruptcy?

6. Are administrative costs higher for private insurance than public insurance?

7. Are low-income families more disadvantaged in the U.S. system?

8. Can the free market work in health care?

****

Response to “The U.S. Health System: The Rest Of The Story”

By Don McCanne

John Goodman says that he wants us to hear the rest of the story, but then he doesn’t tell it to us.

He and his colleagues have pieced together a document using classic Goodman rhetorical deceptions. They pull out of the literature isolated items that support their position without identifying them as exceptions to the great body of information available in the health policy literature. They repeat the use of many studies that have been discredited as manipulations or distortions based on libertarian ideology, even though they are aware of the highly credible challenges to those reports. They use silly diversions to attack some of the most solid and important studies in the health policy literature. Patching these deceptions together creates magical conclusions that would seem to refute the most fundamental principles that can be gleaned from a couple of decades of solid health policy science research.

Using health policy reports retrieved from the refuse bin, they then end with the conclusion that we should adopt their favored proposal for reform, health savings accounts, a non sequitur to the specious arguments they have presented. Even though the policy community has dismissed HSAs as a serious response to the tragic dysfunction of our health care system and its financing mechanisms, the authors persist in abandoning their academic purity in pushing their cause.

“The Rest of the Story” might appeal to ideologues, but it is repulsive to those of us who are outraged by the the physical suffering and financial hardship faced by the millions of U.S. residents who are victims of a flawed financing system, unable to afford or receive the care that they need in a $2.5 trillion health care industry.

http://healthaffairs.org/blog/2009/03/19/the-us-health-system-the-rest-of-the-story/comment-page-1/#comment-24954

Paper on health care reform by John Goodman et al:
http://www.ncpa.org/pdfs/sp_Do_Other_Countries_Have_the_Answers.pdf

O.C. hospital owner to pay $85M to settle OT dispute

By Courtney Perkes
The Orange County Register
March 11, 2009
Tenet Healthcare, the owner of three Orange County hospitals, has agreed to pay $85 million to settle claims that nurses and other 12-hour-shift employees were denied extra pay after a change in California law entitled them to overtime.
At the time the law changed, Tenet was the county’s largest hospital owner with 10 facilities. In settling, the Texas-based company admitted no wrongdoing, but spokesman David Matthews said the California pay practice has stopped.
The case centered on Tenet’s “California differential” pay scale, according to court documents. The suit alleged that to avoid overtime costs, Tenet lowered the hourly pay rate for employees when they worked more than eight hours a day. That meant that while technically earning overtime, their net wages remained the same as before.
According to the suit, Tenet used as many as five hourly pay rates depending on the length of the work shift.
“It’s not enough for an employer to demonstrate that it pays overtime on paper,” said Frank Coughlin, a Santa Ana attorney representing Pagaduan. “They have to pay overtime in money, not math.”
http://www.ocregister.com/articles/tenet-overtime-pay-2332101-pagaduan-settlement

Although PNHP is most noted for its advocacy of a single payer national health program, we also oppose the perversities of for-profit health care corporations in which the primary responsibility of the board of directors is to their investors. Tenet Healthcare has provided us with innumerable examples of these perversities. A quick Google of the PNHP website, in a fraction of a second, produced these lines and many more:
“For-profit hospital chain Tenet, formerly National Medical Enterprises (NME), is the subject of four separate federal investigations…”
“Troubled Tenet Healthcare dominates the expensive list…”
“Overall Tenet’s hospitals averaged gross markups of 477% over costs…”
“Last week, the hospital’s owner, Tenet Healthcare, agreed to pay $54 million to the government to resolve accusations that Redding Medical doctors conducted unnecessary heart procedures and operations on hundreds of healthy patients…”
“Tenet, the second largest US hospital firm, paid more than half a billion dollars to settle…”
“Tenet’s CEO exercised stock options worth $111 million…”
“OrNda Healthcorp, a hospital chain recently acquired by Tenet, paid fines of $12.65 million to the government for kickbacks to physicians for referrals…”
And this was only the first page Googled, but you get the gist.
Regardless of the wisdom of the California requirement of paying 4 hours of overtime for a 12 hour shift, it is the law, and there are several options that Tenet had to comply with it. As a for-profit corporation, they chose a method that would protect their investors from higher labor costs, but a method that involved dishonest accounting.
The employees no longer knew what their hourly wages were because, for each paycheck, Tenet retroactively calculated the hourly wage base so that it would wipe out overtime payments, and that base wage would vary from paycheck to paycheck.
Would you feel secure in a Tenet hospital? What other ways are they cheating to improve their bottom line?
HR 676, the United States National Health Care Act or the Expanded and Improved Medicare for All Act introduced by Rep. John Conyers, would provide for comprehensive health insurance coverage for all United States residents, but that is not all. Recognizing the conflicted interests of for-profit corporations in health care, HR 676 also includes the provision that for-profit providers of care opting to participate shall be required to convert to not-for-profit status.
HR 676 was introduced only seven weeks ago, and already has 66 cosponsors, far more than any other health reform legislation. Yet the members of the House and Senate who are leading the reform process have refused to include it in the dialogue on reform, insisting that any reform include not only the perversities of the for-profit health care corporations, but also, even worse, the profound waste and injustices of a financing system patched together with private health plans.
(The remainder of this message has been deleted because it contained expletives, or would have had it been written.)

Beyond Incrementalism? SCHIP And The Politics Of Health Reform

by Jonathan B. Oberlander and Barbara Lyons
Health Affairs
March 17, 2009
Given the enormous political and fiscal barriers to adopting legislation that aims for universal or near-universal coverage, it could be tempting for Congress and the Obama administration to follow the expansion of children’s health insurance with further incremental measures. The political appeal of such a strategy is understandable: maximizing consensus on incremental policies while avoiding harder, more polarizing, and more expensive reforms is a time-tested strategy in U.S. health policy. Indeed, it is the exact political formula that produced SCHIP’s enactment in 1997. Advocates of incrementalism have long recognized that political constraints mean that the alternative to imperfect, limited reforms is, alas, often to do nothing. In that context, incrementalism looks quite appealing–a fallback position seemingly validated by the repeated failure of big-bang reform.
Yet there are real limits to incremental health reform. After all, despite gains in Medicaid and SCHIP, almost nine million children remain uninsured. The insurance system for children, notwithstanding their sympathetic status, is beset by the same problems that plague the rest of the U.S. health care system: fragmentation, inequality, and alarming coverage gaps. It is a sobering reminder of just how far the country has to go in health reform that we have not been able to secure universal coverage even for children.
There are also limits to a health reform strategy premised on demographic incrementalism that insures Americans group by group. Unlike children or the elderly, most uninsured Americans do not fit into sympathetic population subgroups that can be neatly matched to public programs. The SCHIP formula can only take us so far, since “all the ‘good’ (that is, politically attractive) populations are taken.” To make significant progress toward covering all Americans, we will have to adopt insurance expansions that don’t simply target politically attractive populations.
If the past decade has proved anything in American health policy, it is that incrementalism is not enough. A decade of incrementalism and inaction has left us with higher costs and rising numbers of uninsured Americans; absent decisive action, those trends will only worsen in coming years. It is encouraging, then, that both the Obama administration and key players in Congress are now pursuing bolder reforms. Perhaps we are entering a new era where U.S. health policy will finally move beyond incrementalism.
http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.3.w399v1

Incrementalism: the crossroads of policy and politics.
When each attempt at comprehensive reform fails, the usual response is for everyone to walk away. A few come back to try to retrieve whatever little bit that seems to be politically feasible.
The path of incrementalism has failed to slow the increase in costs and has resulted in increases in the numbers of uninsured and now greater increases in the underinsured. Lauding the mini-successes rings hollow when the health care system continues to have “fragmentation, inequality, and alarming coverage gaps.” By any reasonable standard, incrementalism has been a miserable policy failure.
The incrementalists tell us that the Children’s Health Insurance Program (CHIP) shows us that incrementalism can be a very successful approach to reform. There is no question that this program has been beneficial at least for those children covered. The primary detriment is that it reduced the political pressure for more comprehensive reform.
As the authors point out, children are perhaps the most attractive group for demographic incrementalism. It passes the test of politics, but fails on policy. The CHIP program that “covers all children” has left 9 million children without coverage, perpetuating “fragmentation, inequality, and alarming coverage gaps” for children! The very best incremental program that we have enacted in the past four decades has fallen far short of our goals for reform because beneficial policies were traded away in the politics of reform.
We are now at a rare moment in time when the politics seem aligned so that we can set aside incremental approaches for the time being and seriously consider comprehensive reform. The difficulty is that those leading the reform process are already abandoning important beneficial policies in what they believe will be a successful strategy to keep the politics aligned.
Let’s look at one important example. In their article, Oberlander and Lyons describe the fight over “crowd out,” the concept that, as you raise the qualifying income level for a government children’s insurance program, you increase the number of children that will move from private health plans to the public program that provides a better value. The qualifying income level is very problematic because it is middle-income families that have incomes too high to qualify for the program yet too low to readily afford private insurance. Although the opposition to crowd out could be perceived as an attempt to protect the private insurance industry, the policy principle is much more fundamental.
As the authors explain, “The SCHIP debate revolved around the same boundary issues that will determine the fate of comprehensive reform in 2009 and beyond: the balance between public and private insurance, who should be eligible for government subsidies and at what income level, whether health care is an individual responsibility or social good. Those issues are far from resolved.”
So… the intersection of policy and politics. Those who are leading the reform process and who should believe that health care is a social good are supporting policies that will leave the private insurers in charge, invoking the politics of appeasement to satisfy those who believe that health care is an individual responsibility.
If we are going to achieve our goals of affordable, high quality health care for everyone, it is absolutely imperative that we adopt policies that advance health care as a social good. Policies that shift the responsibility to the individual will further increase our problems with fragmentation, inequality, and alarming coverage gaps.
Whether following a path of incrementalism or the enactment of comprehensive reform, this political divide will never go away. Appeasement politics will always be ruinous for the social good of health care.
The bottom line: The politics must support the policies of health care as a social good, with no compromise. The battle must continue until it is successfully executed. Perceptions of defeat are only perceptions. That is not the time to walk away and eventually crawl back on the ragged path of incrementalism. We must continue the charge, no matter the battle scars, until we achieve health care justice for all. Our finances, our health, and our lives depend on it.

by Jonathan B. Oberlander and Barbara Lyons
Health Affairs
March 17, 2009

Given the enormous political and fiscal barriers to adopting legislation that aims for universal or near-universal coverage, it could be tempting for Congress and the Obama administration to follow the expansion of children’s health insurance with further incremental measures. The political appeal of such a strategy is understandable: maximizing consensus on incremental policies while avoiding harder, more polarizing, and more expensive reforms is a time-tested strategy in U.S. health policy. Indeed, it is the exact political formula that produced SCHIP’s enactment in 1997. Advocates of incrementalism have long recognized that political constraints mean that the alternative to imperfect, limited reforms is, alas, often to do nothing. In that context, incrementalism looks quite appealing–a fallback position seemingly validated by the repeated failure of big-bang reform.

Yet there are real limits to incremental health reform. After all, despite gains in Medicaid and SCHIP, almost nine million children remain uninsured. The insurance system for children, notwithstanding their sympathetic status, is beset by the same problems that plague the rest of the U.S. health care system: fragmentation, inequality, and alarming coverage gaps. It is a sobering reminder of just how far the country has to go in health reform that we have not been able to secure universal coverage even for children.

There are also limits to a health reform strategy premised on demographic incrementalism that insures Americans group by group. Unlike children or the elderly, most uninsured Americans do not fit into sympathetic population subgroups that can be neatly matched to public programs. The SCHIP formula can only take us so far, since “all the ‘good’ (that is, politically attractive) populations are taken.” To make significant progress toward covering all Americans, we will have to adopt insurance expansions that don’t simply target politically attractive populations.

If the past decade has proved anything in American health policy, it is that incrementalism is not enough. A decade of incrementalism and inaction has left us with higher costs and rising numbers of uninsured Americans; absent decisive action, those trends will only worsen in coming years. It is encouraging, then, that both the Obama administration and key players in Congress are now pursuing bolder reforms. Perhaps we are entering a new era where U.S. health policy will finally move beyond incrementalism.

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.3.w399v1

Comment:

By Don McCanne, MD

Incrementalism: the crossroads of policy and politics.

When each attempt at comprehensive reform fails, the usual response is for everyone to walk away. A few come back to try to retrieve whatever little bit that seems to be politically feasible.

The path of incrementalism has failed to slow the increase in costs and has resulted in increases in the numbers of uninsured and now greater increases in the underinsured. Lauding the mini-successes rings hollow when the health care system continues to have “fragmentation, inequality, and alarming coverage gaps.” By any reasonable standard, incrementalism has been a miserable policy failure.

The incrementalists tell us that the Children’s Health Insurance Program (CHIP) shows us that incrementalism can be a very successful approach to reform. There is no question that this program has been beneficial at least for those children covered. The primary detriment is that it reduced the political pressure for more comprehensive reform.

As the authors point out, children are perhaps the most attractive group for demographic incrementalism. It passes the test of politics, but fails on policy. The CHIP program that “covers all children” has left 9 million children without coverage, perpetuating “fragmentation, inequality, and alarming coverage gaps” for children! The very best incremental program that we have enacted in the past four decades has fallen far short of our goals for reform because beneficial policies were traded away in the politics of reform.

We are now at a rare moment in time when the politics seem aligned so that we can set aside incremental approaches for the time being and seriously consider comprehensive reform. The difficulty is that those leading the reform process are already abandoning important beneficial policies in what they believe will be a successful strategy to keep the politics aligned.

Let’s look at one important example. In their article, Oberlander and Lyons describe the fight over “crowd out,” the concept that, as you raise the qualifying income level for a government children’s insurance program, you increase the number of children that will move from private health plans to the public program that provides a better value. The qualifying income level is very problematic because it is middle-income families that have incomes too high to qualify for the program yet too low to readily afford private insurance. Although the opposition to crowd out could be perceived as an attempt to protect the private insurance industry, the policy principle is much more fundamental.

As the authors explain, “The SCHIP debate revolved around the same boundary issues that will determine the fate of comprehensive reform in 2009 and beyond: the balance between public and private insurance, who should be eligible for government subsidies and at what income level, whether health care is an individual responsibility or social good. Those issues are far from resolved.”

So… the intersection of policy and politics. Those who are leading the reform process and who should believe that health care is a social good are supporting policies that will leave the private insurers in charge, invoking the politics of appeasement to satisfy those who believe that health care is an individual responsibility.

If we are going to achieve our goals of affordable, high quality health care for everyone, it is absolutely imperative that we adopt policies that advance health care as a social good. Policies that shift the responsibility to the individual will further increase our problems with fragmentation, inequality, and alarming coverage gaps.

Whether following a path of incrementalism or the enactment of comprehensive reform, this political divide will never go away. Appeasement politics will always be ruinous for the social good of health care.

The bottom line: The politics must support the policies of health care as a social good, with no compromise. The battle must continue until it is successfully executed. Perceptions of defeat are only perceptions. That is not the time to walk away and eventually crawl back on the ragged path of incrementalism. We must continue the charge, no matter the battle scars, until we achieve health care justice for all. Our finances, our health, and our lives depend on it.