PNHP

Presidential hopefuls skip best plan for health care

Presidential hopefuls skip best plan for health care

By MILES WEINBURGER
Des Moines Register
IOWA VIEW
April 26, 2007

We have in America outstanding health-care facilities, excellent doctors and world-class research. What we lack is the universal health-care coverage present in all other industrial nations that provides assurance that health care will be available to us when we need it.

Many of you reading this may say, “I’ve got good insurance that my employer provides.” Let’s hope your insurer stays in business and that you never have to change jobs or go into business for yourself.

Or if you do, hope that you don’t have asthma, high cholesterol, migraine or any kind of headaches, depression or anxiety disorders or the myriad of other common clinical problems that will either make you uninsurable, raise your rates or provide exclusions from coverage.

An article published in a 2005 issue of the Health Affairs journal reported that more than half of the almost 12,000 bankruptcies in Iowa were medically related, a ratio similar to the national average. Most of the people involved had health insurance of some kind, and less than 3 percent of those uninsured had been without insurance voluntarily.

Beneath the fog and rhetoric of the early stages of the presidential campaign, the main contenders for the presidency, other than Democrat Dennis Kucinich, are offering alternatives that preserve the inefficiencies and inequities of the current system. They don’t adequately consider the solutions that could most effectively eliminate the deficiencies that place all of us at risk for joining the one-third of Americans who are uninsured or underinsured.

The plans proposed by the spectrum of politicians fail because they concede to insurance firms a continuing dominant role in health care. The much-publicized plan for universal coverage in Massachusetts, for example, mandates all to buy insurance. However, a 56-year-old making $30,000 annually will have to spend $7,164 in premium and deductible payments before insurance kicks in, and still pony up 20 percent of hospital costs after that, assuming no pre-existing conditions that would either increase costs further or exclude those conditions from coverage.

Such plans are insurance in name only. They leave people unable to get care and unprotected from financial ruin. The only way to simultaneously expand coverage and lower costs is through single-payer national health insurance. Every other developed nation has some form of this, yet most spend less than half what we do per person.

Nearly a third of our $2.3 trillion in health spending this year will go for administration. In their drive to enroll healthy, profitable patients and screen out the sick, private insurers waste vast sums on marketing, billing, underwriting, utilization review and other activities that sustain profits but divert resources from care. The paperwork they inflict on doctors and hospitals costs hundreds of billions more each year.

In contrast to the roughly 20 percent overhead of insurance companies, U.S. Medicare has only 3 percent overhead. Canada’s single-payer program runs for 1 percent overhead. And Canada’s hospitals and doctors face little paperwork burden.

Americans get scant return for our outsized spending. We already pay the highest health-care taxes in the world, and total per-capita spending is twice that of countries with better health outcomes. We already spend enough that the sum should cover universal health coverage – we just don’t get it.

Studies in the prestigious New England Journal of Medicine and elsewhere have shown that streamlining our health bureaucracy through a single public payer – a kind of “Improved Medicare for All” – would save enough new money to provide comprehensive benefits for all Americans.

We deserve better than we’re getting. A single-payer system is the only economically viable reform option that will serve us better as a nation. Yet opposition from insurance and drug-industry giants continues to intimidate lawmakers and aspirants to the presidency. It is time for our leaders to stand up for the health of the American people rather than the wealth of our richest firms.

Dr. MILES WEINBERGER is a professor of pediatrics at the University of Iowa.

CostRx: Kucinich's not-for-profit plan

By LAURA GILCREST
UPI Health Business Editor
April 25, 2007

WASHINGTON April 25 (UPI) — Rep. Dennis Kucinich of Ohio, a Democratic presidential contender, tells United Press International about his plan for national healthcare reform, which is centered on covering all Americans by taking the profit factor out of the equation.

Q: The bill that you co-authored, Medicare for All, uses the present Medicare program as a model for a national plan for universal healthcare. The bill would require private entities providing healthcare to convert to not-for-profit. Is there any role left for the private sector under the plan envisioned in this bill?

A: The understanding is, if you have for-profit medicine, it actually ends up precluding full coverage for all Americans. Under this plan, you’re talking about ending the rationing of healthcare, which is really what’s happening as a result of having for-profit medicine. So (the) short answer is that any for-profit insurance company that would duplicate Medicare for All would not be in business. All hospitals would be converted to not-for-profit.

Q: Would they then come under government control?

A: No, (they’d be) not-for-profit. It’s not that the government (would be) running the hospitals. What we’re talking about is that all of the healthcare assets in America would be converted to not-for-profit. You have Spain and the U.K and other countries that have a system where doctors are salaried by the government, and the government owns the hospitals.

Under Medicare for All, hospitals and doctors remain private, though they do become not-for-profit. And that’s important because there’s a lot of research that shows that for-profit healthcare is more expensive and more wasteful and has worse quality outcomes, including death rates.

You’ve got a lot of these free-market ideologues who try to attack this, but the truth is, that … countries that have a system that is not-for-profit have less red tape and less waste than the private system we have. And under this system, people would be able to choose their own doctor.

Q: One of your Democratic rivals, former Sen. John Edwards, admits he would raise taxes to pay for his healthcare plan. Would you also have to raise taxes?

A: John Edwards’ plan is to have the government subsidize the insurance companies. The truth of the matter is, I’m not talking about (doing) that, so there’s a difference immediately. What I’m saying is that, we’re already paying for healthcare for everyone, we’re just not getting it, and here’s how: About 31 cents out of every healthcare dollar goes to something other than providing healthcare (such as) corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. The cost of this bill is exactly what we’re currently spending on healthcare, $2.1 trillion dollars a year.

Q: So your plan could be accomplished for the same price?

A: Yeah, absolutely. The difference is that my bill gets rid of all the waste and uses the savings and the new efficiency to cover the uninsured and the underinsured completely. It’s important to note that we spent $2.1 trillion on healthcare in America in 2006 and 31 percent of that is bound up in the for-profit system; that’s about $650 billion dollars a year. And if you compare that to the administrative costs in Canada, Canada’s administrative costs are about 17 percent. And Medicare’s administrative costs are about 3 percent.

Q: But wouldn’t a tax hike be inevitable for such an ambitious plan?

A: No, not necessarily. This is not about a tax increase. I’m saying that people can get this care now without a tax increase by eliminating for-profit medicine. That’s the key point. You have over $650 billion a year going for corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. So you take those savings, put them into healthcare and suddenly, you have got enough money to cover 46 million people who don’t have insurance, and another 50 million who are underinsured. There’s so much money available when you make that transition, you then have enough money for vision care, dental care, mental health, prescription drugs and long-term care. This is the reason why you have 14,000 physicians backing (the bill) because what they’re saying is, “Hey, the money’s already there.” There’s no other nation that allows so much waste.

Q: What groups are backing your bill?

A: Fourteen thousand physicians in the Physicians for a National Health Program are backing this, 250 labor unions are backing it.

The fake debate in 2008 is over universal healthcare. Everyone running (for president) says they’re for universal healthcare and even the insurance companies are for universal healthcare, as long as the government is subsidizing them to provide it.

Sen. Edwards and Sen. (Hillary) Clinton are both talking about plans that would involve the government subsidizing the insurance companies, and those plans have fatal flaws because they don’t control costs, they do little to improve quality and they do little for access.

Q: What do you say to the skeptics who argue that more government involvement in healthcare will lead to rationing?

A: We have a rationing system right now, because you’re got 46, 47 million people uninsured; and you’ve got another 50 million who are underinsured. So self-rationing is what we actually have. We’re making costs so high that people avoid care. In other single-payer countries where they do have rationing, the problem is, they’re paying so much less than we are. If we pay more than they pay per person, but much less than we do now, rationing wouldn’t be a problem.

For (the United States), the problem is not the money, it’s the system. We spend more per capita than all these other countries. So the money is there, that’s the point. In some of these other countries, the problem for them is not the system, it’s (a lack of) money.

Q: The Democrats’ attempt to change Medicare’s Part D prescription drug benefit to allow the government to negotiate with drug companies for lower prices failed last week to muster enough votes in the Senate. Does this signal there is still resistance to what is viewed as government-imposed price controls?

A: With respect to this (bill), the government would negotiate the prices; that’s true, and it would have massive purchasing power to do so. The government currently negotiates prices with the Veterans Administration (U.S. Department of Veterans Affairs), so that’s been well-established and it has saved taxpayers, over a period of time, billions of dollars.

(What happened in the Senate) is a reflection of the power of the pharmaceutical companies, and the for-profit insurance companies. That’s one of the reasons why Sen. Edwards and Sen. Clinton are saying that the plan I’m talking about isn’t politically feasible.

(Healthcare) is far and away the No. 1 social and economic issue in this country. Anyone running for president who is conceding control of the system to the for-profit insurers raises serious questions about their ability to lead the nation.

What I’m saying is, those who are advocating the position of the insurance companies, (and) who are saying, “We’re going to cover more people, but the government is going to subsidize the insurance companies,” that (position) protects the insurance companies’ profits.

Q: But critics argue that putting the federal government in control of pricing will kill innovation by the drug industry. How would you respond?

A: We have to take our healthcare system back, we have to take it back from the for-profit insurance companies and from the pharmaceutical companies, who currently control the system for their own profit. This is not about innovation, because the truth of the matter is, a lot of the innovation begins with government-supported research.

What I’m saying is that a significant part of the program is cost control and you cannot control costs if the pharmaceutical companies can charge whatever they want for their drugs.

American companies are losing their competitive edge because they’re paying so much more for healthcare than other developed countries. You look at GM, you look at Ford, and our manufacturing power is being undercut by these insurance companies and by the pharmaceutical companies.

So I raise the question, “Who’s in charge here?” Is this a government of the people or is it a government run by the for-profit insurance companies and by the pharmaceutical companies? That’s why my election will be a powerful change in the direction of a non-for-profit system.

CostRx: Kucinich’s not-for-profit plan

By LAURA GILCREST
UPI Health Business Editor
April 25, 2007

WASHINGTON April 25 (UPI) — Rep. Dennis Kucinich of Ohio, a Democratic presidential contender, tells United Press International about his plan for national healthcare reform, which is centered on covering all Americans by taking the profit factor out of the equation.

Q: The bill that you co-authored, Medicare for All, uses the present Medicare program as a model for a national plan for universal healthcare. The bill would require private entities providing healthcare to convert to not-for-profit. Is there any role left for the private sector under the plan envisioned in this bill?

A: The understanding is, if you have for-profit medicine, it actually ends up precluding full coverage for all Americans. Under this plan, you’re talking about ending the rationing of healthcare, which is really what’s happening as a result of having for-profit medicine. So (the) short answer is that any for-profit insurance company that would duplicate Medicare for All would not be in business. All hospitals would be converted to not-for-profit.

Q: Would they then come under government control?

A: No, (they’d be) not-for-profit. It’s not that the government (would be) running the hospitals. What we’re talking about is that all of the healthcare assets in America would be converted to not-for-profit. You have Spain and the U.K and other countries that have a system where doctors are salaried by the government, and the government owns the hospitals.

Under Medicare for All, hospitals and doctors remain private, though they do become not-for-profit. And that’s important because there’s a lot of research that shows that for-profit healthcare is more expensive and more wasteful and has worse quality outcomes, including death rates.

You’ve got a lot of these free-market ideologues who try to attack this, but the truth is, that … countries that have a system that is not-for-profit have less red tape and less waste than the private system we have. And under this system, people would be able to choose their own doctor.

Q: One of your Democratic rivals, former Sen. John Edwards, admits he would raise taxes to pay for his healthcare plan. Would you also have to raise taxes?

A: John Edwards’ plan is to have the government subsidize the insurance companies. The truth of the matter is, I’m not talking about (doing) that, so there’s a difference immediately. What I’m saying is that, we’re already paying for healthcare for everyone, we’re just not getting it, and here’s how: About 31 cents out of every healthcare dollar goes to something other than providing healthcare (such as) corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. The cost of this bill is exactly what we’re currently spending on healthcare, $2.1 trillion dollars a year.

Q: So your plan could be accomplished for the same price?

A: Yeah, absolutely. The difference is that my bill gets rid of all the waste and uses the savings and the new efficiency to cover the uninsured and the underinsured completely. It’s important to note that we spent $2.1 trillion on healthcare in America in 2006 and 31 percent of that is bound up in the for-profit system; that’s about $650 billion dollars a year. And if you compare that to the administrative costs in Canada, Canada’s administrative costs are about 17 percent. And Medicare’s administrative costs are about 3 percent.

Q: But wouldn’t a tax hike be inevitable for such an ambitious plan?

A: No, not necessarily. This is not about a tax increase. I’m saying that people can get this care now without a tax increase by eliminating for-profit medicine. That’s the key point. You have over $650 billion a year going for corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. So you take those savings, put them into healthcare and suddenly, you have got enough money to cover 46 million people who don’t have insurance, and another 50 million who are underinsured. There’s so much money available when you make that transition, you then have enough money for vision care, dental care, mental health, prescription drugs and long-term care. This is the reason why you have 14,000 physicians backing (the bill) because what they’re saying is, “Hey, the money’s already there.” There’s no other nation that allows so much waste.

Q: What groups are backing your bill?

A: Fourteen thousand physicians in the Physicians for a National Health Program are backing this, 250 labor unions are backing it.

The fake debate in 2008 is over universal healthcare. Everyone running (for president) says they’re for universal healthcare and even the insurance companies are for universal healthcare, as long as the government is subsidizing them to provide it.

Sen. Edwards and Sen. (Hillary) Clinton are both talking about plans that would involve the government subsidizing the insurance companies, and those plans have fatal flaws because they don’t control costs, they do little to improve quality and they do little for access.

Q: What do you say to the skeptics who argue that more government involvement in healthcare will lead to rationing?

A: We have a rationing system right now, because you’re got 46, 47 million people uninsured; and you’ve got another 50 million who are underinsured. So self-rationing is what we actually have. We’re making costs so high that people avoid care. In other single-payer countries where they do have rationing, the problem is, they’re paying so much less than we are. If we pay more than they pay per person, but much less than we do now, rationing wouldn’t be a problem.

For (the United States), the problem is not the money, it’s the system. We spend more per capita than all these other countries. So the money is there, that’s the point. In some of these other countries, the problem for them is not the system, it’s (a lack of) money.

Q: The Democrats’ attempt to change Medicare’s Part D prescription drug benefit to allow the government to negotiate with drug companies for lower prices failed last week to muster enough votes in the Senate. Does this signal there is still resistance to what is viewed as government-imposed price controls?

A: With respect to this (bill), the government would negotiate the prices; that’s true, and it would have massive purchasing power to do so. The government currently negotiates prices with the Veterans Administration (U.S. Department of Veterans Affairs), so that’s been well-established and it has saved taxpayers, over a period of time, billions of dollars.

(What happened in the Senate) is a reflection of the power of the pharmaceutical companies, and the for-profit insurance companies. That’s one of the reasons why Sen. Edwards and Sen. Clinton are saying that the plan I’m talking about isn’t politically feasible.

(Healthcare) is far and away the No. 1 social and economic issue in this country. Anyone running for president who is conceding control of the system to the for-profit insurers raises serious questions about their ability to lead the nation.

What I’m saying is, those who are advocating the position of the insurance companies, (and) who are saying, “We’re going to cover more people, but the government is going to subsidize the insurance companies,” that (position) protects the insurance companies’ profits.

Q: But critics argue that putting the federal government in control of pricing will kill innovation by the drug industry. How would you respond?

A: We have to take our healthcare system back, we have to take it back from the for-profit insurance companies and from the pharmaceutical companies, who currently control the system for their own profit. This is not about innovation, because the truth of the matter is, a lot of the innovation begins with government-supported research.

What I’m saying is that a significant part of the program is cost control and you cannot control costs if the pharmaceutical companies can charge whatever they want for their drugs.

American companies are losing their competitive edge because they’re paying so much more for healthcare than other developed countries. You look at GM, you look at Ford, and our manufacturing power is being undercut by these insurance companies and by the pharmaceutical companies.

So I raise the question, “Who’s in charge here?” Is this a government of the people or is it a government run by the for-profit insurance companies and by the pharmaceutical companies? That’s why my election will be a powerful change in the direction of a non-for-profit system.

Small businesses support national health insurance

Survey of small and mid-sized businesses

National Small Business Association
Conducted March 27 – April 1, 2007
Glen Bolger and Nicole McCleskey, Public Opinion Strategies

Employee Benefits and Labor Issues

4. The number of companies offering no benefits at all has increased from 2000.

In 2000, 24% of companies surveyed offered no employee benefits. In the current survey, 30% of companies surveyed offer no benefits at all. This includes a significant drop over the last several years in the number of companies offering health benefits:

% Companies offering health benefits

1995 67%
2000 51%
2007 41%

5. Companies have made changes in their health benefit programs in response to high costs.

While most companies are trying to get by without taking cost-cutting measures to health care benefits, over one-third (37%) have taken some cost-cutting action.

It is the larger companies in the survey (20 or more employees) who are taking the more drastic action (possibly because they are more likely to offer health care benefits). In fact, 69% of these companies have taken cost-cutting steps that include: increasing employee contributions (37%), changing insurance companies (27%), instituting wellness programs (26%), and changing to policies with higher deductibles (26%).

Public Policy

10. Businesses express strong support for health care reform, but reject a government mandate for businesses to provide it for their employees.

Seventy-one percent (71%) of businesses support the following health care reform positioning:

Require that every individual in this country secure a basic health care package. To assist with this, insurance companies would be required to offer coverage to people with pre-existing conditions, and individuals and families would be provided with federal financial assistance to pay for health care premiums, based on income.

But businesses entirely reject a mandate on businesses to provide coverage. An equal number oppose the following proposal (71%), including 50% who strongly oppose it:

A requirement that all employers must provide health insurance benefits to all employees.

Presented an alternative that does not rely so heavily on business, those surveyed would prefer a “federally funded, government administered health care system financed through higher taxes.” Overall 60% favor this proposal, although the intensity of support is more tepid (29% strongly favor).

11. Asked what issues they would like to see the presidential campaigns address, the tax burden and health care costs top the list.

Overall, 31% of those surveyed want the presidential campaigns to address the issue of the tax burden on American businesses. This is a particularly critical issue to Republican business respondents, but also tops the list for Independents.

Thirty percent (30%) of respondents say health care costs is the most important priority. This was the biggest concern for Democrat respondents, and in a close second position among Independents.

Executive Summary:
http://www.nsba.biz/docs/survey-summary.pdf

NSBA National Survey:
http://www.nsba.biz/docs/surveyfinal.pdf

Comment:

By Don McCanne, MD

Small businesses have been struggling with the costs of health insurance, and the problem only grows worse. In fact, in the past 15 years, the percentage of small business owners even offering health insurance to their employees has dropped from two-thirds to two-fifths.

Therefore it is no surprise that 71 percent of small business owners oppose a government mandate on employers to provide health coverage (employer mandate). In contrast, 71 percent are quite willing to support a government mandate that would require their employees to purchase their own insurance (individual mandate), with income-based government subsidies. Small business owners concede that the government must assist with the funding of employee health care coverage.

A clear majority, 60 percent, also would support “a federally-funded, government administered health care system financed through taxes in which everyone has health care coverage for all medically necessary treatment and procedures.”

The problem with an individual mandate is that private insurance policies that would provide adequate financial protection in the face of medical need are no longer affordable for the large number of average- and low-average-income individuals. These are the individuals whose incomes are above the thresholds that would qualify them for government subsidies, and they are also the individuals who are concentrated in the small business employee sector.

Most employers really do care about their employes and would likely reject the individual mandate if they realized how ineffective it would be. Even for those employers who are less altruistic, the prospect of having to pay higher salaries to cover employees’ costs for the individual mandate would likely be off-putting.

What employers really do want is an equitable method of financing health care for their employees. By far the most equitable method would be a common risk pool funded by progressive tax policies. A majority of small business owners already accept this, but if they understood that an individual mandate is clearly not the solution they seek, the support for national health insurance would be even greater.

The Health of Nations

Here’s how Canada, France, Britain, Germany, and our own Veterans Health Administration manage to cover everybody at less cost and with better care than we do.

By Ezra Klein
The American Prospect
05.08.07

Medicine may be hard, but health insurance is simple. The rest of the world’s industrialized nations have already figured it out, and done so without leaving 45 million of their countrymen uninsured and 16 million or so underinsured, and without letting costs spiral into the stratosphere and severely threaten their national economies.

Even better, these successes are not secret, and the mechanisms not unknown. Ask health researchers what should be done, and they will sigh and suggest something akin to what France or Germany does. Ask them what they think can be done, and their desperation to evade the opposition of the insurance industry and the pharmaceutical industry and conservatives and manufacturers and all the rest will leave them stammering out buzzwords and workarounds, regional purchasing alliances and health savings accounts. The subject’s famed complexity is a function of the forces protecting the status quo, not the issue itself.

So let us, in these pages, shut out the political world for a moment, cease worrying about what Aetna, Pfizer, and Grover Norquist will say or do, and ask, simply: What should be done? To help answer that question, we will examine the best health- care systems in the world: those of Canada, France, Great Britain, Germany, and the U.S. Veterans Health Administration (VHA), whose inclusion I’ll justify shortly.

Putting aside the VHA, America’s annual per person health expenditures are about twice what anyone else spends. That actually understates the difference, as our 45 million uninsured citizens have radically restricted access to care, and so the spending on the median insured American is actually quite a bit higher. Canada, France, Great Britain, and Germany all cover their entire populations, and they do so for far less money than we spend. Indeed, Canada, whose system is the most costly of the group, spends only 52 percent per capita what we do.

While comparing outcomes is difficult because of various lifestyle and demographic differences in the populations served, none of the systems mentioned betray any detectable disadvantage in outcomes when compared with the United States, and a strong case can be made that they in fact perform better. Here, however, I largely restrict myself to comparisons of efficiency and equity. With that said, off we go.

Oh, Canada!

As described by the American press, Canada’s health-care system takes the form of one long queue. The line begins on the westernmost edge of Vancouver, stretches all the way to Ottawa, and the overflow are encouraged to wait in Port Huron, Michigan, while sneering at the boorish habits of Americans. Nobody gets to sit.

Sadly for those invested in this odd knock against the Canadian system, the wait times are largely hype. A 2003 study found that the median wait time for elective surgeries in Canada was a little more than four weeks, while diagnostic tests took about three (with no wait times to speak of for emergency surgeries). By contrast, Organisation for Economic Co-operation and Development data from 2001 found that 32 percent of American patients waited more than a month for elective surgery, and 5 percent waited more than four months. That, of course, doesn’t count the millions of Americans who never seek surgery, or even the basic care necessary for a diagnosis, because they lack health coverage. If you can’t see a doctor in the first place, you never have to wait for treatment.

Canada’s is a single-payer, rather than a socialized, system. That means the government is the primary purchaser of services, but the providers themselves are private. (In a socialized system, the physicians, nurses, and so forth are employed by the government.) The virtue of both the single-payer and the socialized systems, as compared with a largely private system, is that the government can wield its market share to bargain down prices — which, in all of our model systems, including the VHA, it does.

A particularly high-profile example of how this works is Canadian drug reimportation. The drugs being bought in Canada and smuggled over the border by hordes of lawbreaking American seniors are the very same pharmaceuticals, made in the very same factories, that we buy domestically. The Canadian provinces, however, bargain down the prices (Medicare is barred from doing the same) until we pay 60 percent more than they do.

Single-payer systems are also better at holding down administrative costs. A 2003 study in The New England Journal of Medicine found that the United States spends 345 percent more per capita on health administration than our neighbors up north. This is largely because the Canadian system doesn’t have to employ insurance salespeople, or billing specialists in every doctor’s office, or underwriters. Physicians don’t have to negotiate different prices with dozens of insurance plans or fight with insurers for payment. Instead, they simply bill the government and are reimbursed.

The downside of a single-payer system in the Canadian style is that it constructs a system with a high floor and a low ceiling. If you don’t like the government’s care options, there’s no real alternative. In this, Canada is rare. As we’ll see with both France and Germany, other countries are able to preserve a largely nationalized system with universal access while allowing private options at the upper levels.

France

It’s a common lament among health-policy wonks that the world’s best health-care system resides in a country Americans are particularly loath to learn from. Yet France’s system is hard to beat. Where Canada’s system has a high floor and a low ceiling, France’s has a high floor and no ceiling. The government provides basic insurance for all citizens, albeit with relatively robust co-pays, and then encourages the population to also purchase supplementary insurance — which 86 percent do, most of them through employers, with the poor being subsidized by the state. This allows for as high a level of care as an individual is willing to pay for, and may help explain why waiting lines are nearly unknown in France.

France’s system is further prized for its high level of choice and responsiveness — attributes that led the World Health Organization to rank it the finest in the world (America’s system came in at No. 37, between Costa Rica and Slovenia). The French can see any doctor or specialist they want, at any time they want, as many times as they want, no referrals or permissions needed. The French hospital system is similarly open. About 65 percent of the nation’s hospital beds are public, but individuals can seek care at any hospital they want, public or private, and receive the same reimbursement rate no matter its status. Given all this, the French utilize more care than Americans do, averaging six physician visits a year to our 2.8, and they spend more time in the hospital as well. Yet they still manage to spend half per capita than we do, largely due to lower prices and a focus on preventive care.

That focus is abetted by the French system’s innovative response to one of the trickier problems bedeviling health-policy experts: an economic concept called “moral hazard.” Moral hazard describes people’s tendency to overuse goods or services that offer more marginal benefit without a proportionate marginal cost. Translated into English, you eat more at a buffet because the refills are free, and you use more health care because insurers generally make you pay up front in premiums, rather than at the point of care. The obvious solution is to shift more of the cost away from premiums and into co-pays or deductibles, thus increasing the sensitivity of consumers to the real cost of each unit of care they purchase.

This has been the preferred solution of the right, which has argued for a move toward high-deductible care, in which individuals bear more financial risk and vulnerability. As the thinking goes, this increased exposure to the economic consequences of purchasing care will create savvier health-care consumers, and individuals will use less unnecessary care and demand better prices for what they do use.

Problem is, studies show that individuals are pretty bad at distinguishing necessary care from unnecessary care, and so they tend to cut down on mundane-but-important things like hypertension medicine, which leads to far costlier complications. Moreover, many health problems don’t lend themselves to bargain shopping. It’s a little tricky to try to negotiate prices from an ambulance gurney.

A wiser approach is to seek to separate cost-effective care from unproven treatments, and align the financial incentives to encourage the former and discourage the latter. The French have addressed this by creating what amounts to a tiered system for treatment reimbursement. As Jonathan Cohn explains in his new book, Sick:

In order to prevent cost sharing from penalizing people with serious medical problems — the way Health Savings Accounts threaten to do — the [French] government limits every individual’s out-of-pocket expenses. In addition, the government has identified thirty chronic conditions, such as diabetes and hypertension, for which there is usually no cost sharing, in order to make sure people don’t skimp on preventive care that might head off future complications.

The French do the same for pharmaceuticals, which are grouped into one of three classes and reimbursed at 35 percent, 65 percent, or 100 percent of cost, depending on whether data show their use to be cost effective. It’s a wise straddle of a tricky problem, and one that other nations would do well to emulate.

Great Britain

I include Great Britain not because its health system is very good but because its health system is very cheap. Per capita spending in Great Britain hovers around 40 percent what it is in the United States, and outcomes aren’t noticeably worse. The absolute disparity between what we pay and what they get illuminates a troublesome finding in the health-care literature: Much of the health care we receive appears to do very little good, but we don’t yet know how to separate the wheat from the chaff. Purchasing less of it, however, doesn’t appear to do much damage.

What’s interesting is that many of the trade-offs that our health-care system downplays, the English system emphasizes. Where our medical culture encourages near-infinite amounts of care, theirs subtly dissuades lavish health spending, preferring to direct finite funds to other priorities.

This sort of national prioritizing is made easier because Great Britain has a socialized system, wherein the government directly employs most of the providers. Great Britain contains costs in part by paying doctors through capitation, which gives doctors a flat monthly sum for every patient in their practice. Since most patients don’t need care in a given month, the payments for the healthy subsidize the needs of the sick. Crucially, though, the fixed pool of monthly money means doctors make more for offering less treatment. With traditional fee-for-service arrangements, like ours, doctors gain by treating more. The British system, by contrast, lowers total costs by lowering the quantity of prescribed care. As University of San Francisco professors Thomas Bodenheimer and Kevin Grumbach write, “British physicians simply do less of nearly everything — perform fewer surgeries, prescribe fewer medications, and order fewer x-rays.”

That may sound strange, but it also means that society pays for fewer of those surgeries, fewer of those medications, and fewer of those X-rays — and as far as we can tell, the English aren’t suffering for it. Indeed, a 2006 study published in The Journal of the American Medical Association found that, on average, English people are much healthier than Americans are; they suffer from lower rates of diabetes, hypertension, heart disease, heart attack, stroke, lung disease, and cancer. According to the study’s press release, the differences are vast enough that “those in the top education and income level in the U.S. had similar rates of diabetes and heart disease as those in the bottom education and income level in Great Britain.”

Great Britain’s example proves that it is possible to make economy a guiding virtue of a health system. We could do that on the supply side, through policies like capitation that would change the incentives for doctors, or on the demand side, by making patients pay more up front — or both, or neither. Americans may not want that system, in the same way that the owner of a Range Rover may not want a Corolla, but we should at least recognize that we have chosen to make health care a costly priority, and were we to decide to prioritize differently, we could.

Germany

The German system offers a possible model for those who want to retain the insurance industry but end its ability to profit by pricing out the sick and shifting financial risk onto individuals. The German system’s insurers are 300 or so different “sickness funds” that act both as both payers and purchasers for their members’ care. Originally, each fund covered only a particular region, profession, or company, but now each one has open enrollment. All, however, are heavily regulated, not for profit, and neither fully private nor publicly owned. The funds can’t charge different prices based on age or health status, and they must continue covering members even when the members lose the job or status that got them into the fund in the first place. The equivalent would be if you could retain membership in your company’s health-care plan after leaving the company.

The move toward open enrollment was an admission that interfund competition could have some positive effects. The fear, however, was that the funds would begin competing for the healthiest enrollees and maneuvering to avoid the sickest, creating the sort of adverse selection problems that bedevil American insurance. To avoid such a spiral, the government has instituted exactly the opposite sort of risk profiling that we have in the United States. Rather than identifying the unhealthy to charge them higher rates, as our insurers do, the government compels sickness funds with particularly healthy applicants to pay into a central fund; the government then redistributes those dollars to the funds with less-healthy enrollees. In other words, the government pays higher rates to sickness funds with unhealthy enrollees in order to level the playing field and make the funds compete on grounds of price and efficiency. In this way, the incentive to dump the sick and capture the well is completely erased. The burdens of bad luck and ill health are spread across the populace, rather than remaining confined to unlucky individuals.

The system works well enough that even though Germans are allowed to opt-out of the sickness funds, they largely don’t. Those with incomes of more than $60,000 a year are not required to join a sickness fund; about 10 percent of these citizens purchase private insurance and .02 percent choose to eschew coverage entirely. The retention of a private insurance option ensures that Germans have an escape hatch if the sickness funds cease providing responsive and comprehensive coverage; it also clears a channel for experimentation and the rapid introduction of new technologies. And the mix of private-public competition works to spur innovation: By 2005, Germany had spent $21.20 per capita wiring its system with health-information technology; America, meanwhile, had spent a mere 43 cents per capita, and most U.S. hospitals still have no systems to speak of.

What the German system has managed to achieve is competition without cruelty, deploying market forces without unleashing capitalism’s natural capriciousness. They have not brought the provision of health care completely under the government’s control, but neither have they allowed the private market, with its attendant and natural focus on profits, to have its way with their health system. It’s a balance the United States has been unable to strike.

The Veterans Health Administration

The mistreatment and poor conditions at the Walter Reed Army Medical Center were a front-page story recently, and they were rather conclusive in showing the system’s inadequacy. But don’t be confused: Walter Reed is a military hospital, not a VHA hospital. Poor reporting inaccurately smeared the quietly remarkable reputation of the best medical system in America.

Over the last decade or two, the VHA system has become a worldwide leader in both the adoption and the invention of health-information technology, and it has leveraged its innovations into quantifiable gains in quality of care. As Harvard’s Kennedy School noted when awarding the VHA its prestigious Innovations in American Government prize:

[The] VHA’s complete adoption of electronic health records and performance measures have resulted in high-quality, low-cost health care with high patient satisfaction. A recent RAND study found that VHA outperforms all other sectors of American health care across the spectrum of 294 measures of quality in disease prevention and treatment. For six straight years, VHA has led private-sector health care in the independent American Customer Satisfaction Index.

Indeed, the VHA’s lead in care quality isn’t disputed. A New England Journal of Medicine study from 2003 compared the VHA with fee-for-service Medicare on 11 measures of quality. The VHA came out “significantly better” on every single one. The Annals of Internal Medicine pitted the VHA against an array of managed-care systems to see which offered the best treatment for diabetics. The VHA triumphed in all seven of the tested metrics. The National Committee for Quality Assurance, meanwhile, ranks health plans on 17 different care metrics, from hypertension treatment to adherence to evidence-based treatments. As Phillip Longman, the author of Best Care Anywhere, a book chronicling the VHA’s remarkable transformation, explains: “Winning NCQA’s seal of approval is the gold standard in the health-care industry. And who do you suppose is the highest ranking health care system? Johns Hopkins? Mayo Clinic? Massachusetts General? Nope. In every single category, the veterans health care system outperforms the highest-rated non-VHA hospitals.”

What makes this such an explosive story is that the VHA is a truly socialized medical system. The unquestioned leader in American health care is a government agency that employs 198,000 federal workers from five different unions, and nonetheless maintains short wait times and high consumer satisfaction. Eighty-three percent of VHA hospital patients say they are satisfied with their care, 69 percent report being seen within 20 minutes of scheduled appointments, and 93 percent see a specialist within 30 days.

Critics will say that the VHA is not significantly cheaper than other American health care, but that’s misleading. In fact, the VHA is also proving far better than the private sector at controlling costs. As Longman explains, “Veterans enrolled in [the VHA] are, as a group, older, sicker, poorer, and more prone to mental illness, homelessness, and substance abuse than the population as a whole. Half of all VHA enrollees are over age 65. More than a third smoke. One in five veterans has diabetes, compared with one in 14 U.S. residents in general.” Yet the VHA’s spending per patient in 2004 was $540 less than the national average, and the average American is healthier and younger (the nation includes children; the VHA doesn’t).

The VHA’s advantages come in part from its development of the health-information software VistA, which was created at taxpayer expense and is now distributed for free to any health systems that wish to use it. It’s a remarkably adaptive program that helps in virtually every element of care delivery, greatly aiding efforts to analyze symptoms and patient reactions in order to improve diagnoses and treatments, reduce mistaken interventions, and eliminate all sorts of care redundancies.

The VHA also benefits from the relative freedoms of being a public, socialized system. It’s a sad reality that in the American medical system, doctors make money treating the sick, not keeping patients well. Thus, we encourage intervention-based, rather than prevention-based, medicine. It’s telling, for instance, that hospital emergency rooms, where we handle traumas, are legally required to treat the poor, but general practitioners, who can manage conditions and catch illnesses early and cheaply, can turn away the destitute.

Moreover, patients are transient, so early investments in their long-term health will offer financial rewards to other providers. And which HMO wants to be known as the one that’s really good at treating diabetes? Signing up a bunch of diabetes patients is no way to turn a profit.

As Longman details, the VHA suffers from none of these problems. Its patients are patients for life, so investing early and often in their long-term health is cost-effective; the system was set up to deal with the sick, so the emphasis is on learning how to best manage diseases rather than avoid the diseased; and the doctors are salaried, so they have no incentives to either over- or undertreat patients. Moreover, the VHA is not only empowered to bargain down drug costs; it also uses formularies (lists of covered drugs), and so is actually empowered to walk away from a pharmaceutical company that won’t meet its offer.

The results have been clear. “Between 1999 and 2003,” writes Longman, “the number of patients enrolled in the VHA system increased by 70 percent, yet funding (not adjusted for inflation) increased by only 41 percent. So the VHA has not only become the health-care industry’s best quality performer, it has done so while spending less and less on each patient.” Pretty good for socialized medicine.

The goal of health care is to get everyone covered, at the lowest possible cost, with the highest possible quality. But in the United States, there is another element in the equation that mucks up the outcome: Our system seeks to get everyone covered, at the lowest possible cost, with the highest possible quality, while generating the maximum possible profits. Within that context, the trade-offs and outcomes all seem to benefit the last goal, and so we tolerate 45 million uninsured Americans, unbelievably high prices, and a fractured system that lacks the proper incentives to deliver high-quality care.

This makes it hard to move toward a preventive system, as Canada has, because preventive medicine pays less. It makes it hard to address moral-hazard issues wisely, as the French have, because it’s unprofitable to insure diabetics, and less profitable still to make their care essentially free. It makes it hard to institute the cost savings that Great Britain has, because with less money flowing into the system, there would be far less profit to be made. It makes it hard to harness market forces while protecting against individual risk, as Germany has, because insurer business models are predicated on shifting risk to employers and individuals, and profits are made when insurers can keep that risk from being shifted back onto them. And it is impossible to implement the practices that have so improved the VHA, because doing so would require a single, coherent health system that stuck with its members through their life cycles rather than an endlessly fractured structure in which insurers pawn off their members as they grow old, ill, or unemployed.

That’s not to say that there’s no room for profit within the American health-care system, but that it’s time the discussion stopped focusing on how to preserve the interests of moneyed stakeholders and started asking how to deliver the best care, for the lowest cost, at the highest quality — to every American. Such a system will probably still have private insurers (at least at the high end of care), pay enough to encourage pharmaceutical innovation, and allow for choice and competition and market pressures. But it will take as its guiding principle the health of the populace, rather than that of the providers. That, in the end, is what all the model health-care systems have in common. Except ours.

Ezra Klein is a writing fellow at the Prospect.

Controversial Michael Moore Flick "Sicko" Will Compare U.S. Health Care with Cuba's

By Don Hazen
AlterNet
April 23, 2007

To state that controversy and Michael Moore go hand and hand is to utter the obvious, and Moore’s latest film Sicko will clearly be no exception.

Sicko, which will be premiering at the Cannes Film Festival in May, is a comic broadside against the state of American health care, including the mental health system. The film targets drug companies and the HMOS in the richest country in the world — where the most money is spent on health care, but where the U.S. ranks 21st in life expectancy among the 30 most developed nations, obviously in part due to the fact that 47 million people are without health insurance.

The timing of Moore’s film is propitious. Twenty-two percent of Americans say that health care is the most pressing issue in America. Health care will clearly be a major issue in the upcoming presidential campaign, as the problems with America’s health care system have mushroomed during the Bush administration. For example, between 2001 and 2005 the number of people without health insurance rose 16.6 percent. The average health insurance premiums for a family of four are $10,880, which exceeds the annual gross income of $10,712 for a full-time, minimum-wage worker. In addition, the lack of insurance causes 18,000 excess deaths a year while people without health insurance have 25 percent higher mortality rates. Fifty-nine percent of uninsured people with chronic conditions such as asthma or diabetes skip medicine or go without care.

Under wraps, but one surprise out of the bag

The details of Moore’s new film are being kept under tight wraps. According to inside sources, only a handful of people have seen the film, and both the film maker and Harvey Weinstein — the film’s distributor, who also distributed Moore’s hugely successful Fahrenheit 9/11 — are remaining tight-lipped about the film’s contents.

Nevertheless, one aspect of the film will not be a total surprise. One of the film’s segments, an increasingly controversial boat trip to Cuba, exploded onto the pages of The New York Post, the Rupert Murdoch-owned tabloid, when at least one 9/11 cleanup worker who had been invited to participate in a trip to Cuba for Moore’s Sicko went to the press.

The boat trip, according to sources who spoke to both the NY Post and The Daily News, took ailing rescue workers to Cuba for health treatment for respiratory ailments which they suffer as a result of working at Ground Zero, and for which a number of the workers have no health insurance. The purpose of the trip, according to some, was to show that the free health care in Cuba is superior to the health care system in the U.S. Those invited on the trip, as described by Janon Fisher in the Post, were told the “Cuban doctors had developed new techniques for treating lung cancer and other respiratory illnesses,” and that health care in Cuba was free.

Health care advances in Cuba

According to the Associated Press as cited in the Post article, “Cuba has made recent advancements in biotechnology and exports its treatments to 40 countries around the world, raking in an estimated $100 million a year. … In 2004, the U.S. government granted an exception to its economic embargo against Cuba and allowed a California drug company to test three cancer vaccines developed in Havana.”

Although trip participants signed confidentiality agreements prohibiting them from talking about the trip, some thought the trip a success. From the NY Post:

“From what I hear through the grapevine those people who went are utterly happy, said John Feal, who runs the Fealgood Foundation to raise money for responders and was approached by Moore to find responders willing to take the trip. “They got the Elvis treatment.”

According to staff writer Bill Hutchinson from the Daily News, Moore was praised for seeking medical alternatives. Retired Firefighter Vinnie Forras, 49, said he’s been going to Ecuador and Bolivia for experimental treatments for lung damage and severe headaches which he suffered at Ground Zero. “For me, anyone who’s looking to try to help the guys and women who are sick is a good thing. I don’t care where you go for that treatment.”

On the other hand, some balked at the idea of going: “I would rather die an American than go to Cuba,” Joe Picurro told the NY Post. Picurro, an ironworker with a laundry list of respiratory and other ailments, said, “I just laughed. I couldn’t do it. ”

America’s second-class health care system

Clearly one of the themes of Moore’s films, highlighted by the trip to Cuba, is to challenge the myth that the U.S. has superior health care when compared with other countries. In a recent AlterNet article, attorney Guy Saperstein explained,

“The World Health Organization ranks health care systems based on objective measures of medical outcomes: The United States’ health care system currently ranks 37th in the world, behind Colombia and Portugal; the United States ranks 44th in the world in infant mortality, behind many impoverished Latin American countries. While infant mortality in the United States is skewed toward poor people, who have rates double the wealthy, the top quintile of the U.S. population has infant mortality rates higher than Canadians in the lowest quintile of wealth.

“The United States has fewer physicians, nurses and hospital beds than most developed nations. In the United States, 28 percent say it is “difficult to get care”; in most European countries, Japan, Australia and New Zealand, 15 percent say that. In terms of continuity of care (i.e., five-plus years with the same doctor), the United States is the worst of all developed nations. By every objective measure, the United States has a second-rate health care system.”

It is unclear how soon after Cannes Sicko will open in U.S. theaters. But with the aggressive and often Oscar hungry Weinstein at the distribution helm, there is little doubt that the movie will make a big splash, bubbling up many more controversies. Moore’s film has been a long time coming — three years since his huge success with Fahrenheit 9/11, which was awarded the Palme d’Or (Golden Palm), the festival’s highest award, by an international jury in 2004.

Legend has it that while Moore has been critical of Cuba, he became a hero there after a pirated version of Fahrenheit 9/11 was shown on government-controlled TV. It’s ironic that Cuba showed a free version, because the film has made boatloads of money. According to the Wikipedia, “As of January 2005, [Fahrenheit 9/11] had broken all box office records for a documentary grossing nearly US $120 million in U.S. box office, and over US $220 million worldwide, an unprecedented amount for a political documentary; Sony reported first-day DVD sales of two million copies, again a new record for the genre.”

Only time will tell if Moore can duplicate his success.

Don Hazen is the executive editor of AlterNet.

2007 Independent Media Institute. All rights reserved.

Controversial Michael Moore Flick “Sicko” Will Compare U.S. Health Care with Cuba’s

By Don Hazen
AlterNet
April 23, 2007

To state that controversy and Michael Moore go hand and hand is to utter the obvious, and Moore’s latest film Sicko will clearly be no exception.

Sicko, which will be premiering at the Cannes Film Festival in May, is a comic broadside against the state of American health care, including the mental health system. The film targets drug companies and the HMOS in the richest country in the world — where the most money is spent on health care, but where the U.S. ranks 21st in life expectancy among the 30 most developed nations, obviously in part due to the fact that 47 million people are without health insurance.

The timing of Moore’s film is propitious. Twenty-two percent of Americans say that health care is the most pressing issue in America. Health care will clearly be a major issue in the upcoming presidential campaign, as the problems with America’s health care system have mushroomed during the Bush administration. For example, between 2001 and 2005 the number of people without health insurance rose 16.6 percent. The average health insurance premiums for a family of four are $10,880, which exceeds the annual gross income of $10,712 for a full-time, minimum-wage worker. In addition, the lack of insurance causes 18,000 excess deaths a year while people without health insurance have 25 percent higher mortality rates. Fifty-nine percent of uninsured people with chronic conditions such as asthma or diabetes skip medicine or go without care.

Under wraps, but one surprise out of the bag

The details of Moore’s new film are being kept under tight wraps. According to inside sources, only a handful of people have seen the film, and both the film maker and Harvey Weinstein — the film’s distributor, who also distributed Moore’s hugely successful Fahrenheit 9/11 — are remaining tight-lipped about the film’s contents.

Nevertheless, one aspect of the film will not be a total surprise. One of the film’s segments, an increasingly controversial boat trip to Cuba, exploded onto the pages of The New York Post, the Rupert Murdoch-owned tabloid, when at least one 9/11 cleanup worker who had been invited to participate in a trip to Cuba for Moore’s Sicko went to the press.

The boat trip, according to sources who spoke to both the NY Post and The Daily News, took ailing rescue workers to Cuba for health treatment for respiratory ailments which they suffer as a result of working at Ground Zero, and for which a number of the workers have no health insurance. The purpose of the trip, according to some, was to show that the free health care in Cuba is superior to the health care system in the U.S. Those invited on the trip, as described by Janon Fisher in the Post, were told the “Cuban doctors had developed new techniques for treating lung cancer and other respiratory illnesses,” and that health care in Cuba was free.

Health care advances in Cuba

According to the Associated Press as cited in the Post article, “Cuba has made recent advancements in biotechnology and exports its treatments to 40 countries around the world, raking in an estimated $100 million a year. … In 2004, the U.S. government granted an exception to its economic embargo against Cuba and allowed a California drug company to test three cancer vaccines developed in Havana.”

Although trip participants signed confidentiality agreements prohibiting them from talking about the trip, some thought the trip a success. From the NY Post:

“From what I hear through the grapevine those people who went are utterly happy, said John Feal, who runs the Fealgood Foundation to raise money for responders and was approached by Moore to find responders willing to take the trip. “They got the Elvis treatment.”

According to staff writer Bill Hutchinson from the Daily News, Moore was praised for seeking medical alternatives. Retired Firefighter Vinnie Forras, 49, said he’s been going to Ecuador and Bolivia for experimental treatments for lung damage and severe headaches which he suffered at Ground Zero. “For me, anyone who’s looking to try to help the guys and women who are sick is a good thing. I don’t care where you go for that treatment.”

On the other hand, some balked at the idea of going: “I would rather die an American than go to Cuba,” Joe Picurro told the NY Post. Picurro, an ironworker with a laundry list of respiratory and other ailments, said, “I just laughed. I couldn’t do it. ”

America’s second-class health care system

Clearly one of the themes of Moore’s films, highlighted by the trip to Cuba, is to challenge the myth that the U.S. has superior health care when compared with other countries. In a recent AlterNet article, attorney Guy Saperstein explained,

“The World Health Organization ranks health care systems based on objective measures of medical outcomes: The United States’ health care system currently ranks 37th in the world, behind Colombia and Portugal; the United States ranks 44th in the world in infant mortality, behind many impoverished Latin American countries. While infant mortality in the United States is skewed toward poor people, who have rates double the wealthy, the top quintile of the U.S. population has infant mortality rates higher than Canadians in the lowest quintile of wealth.

“The United States has fewer physicians, nurses and hospital beds than most developed nations. In the United States, 28 percent say it is “difficult to get care”; in most European countries, Japan, Australia and New Zealand, 15 percent say that. In terms of continuity of care (i.e., five-plus years with the same doctor), the United States is the worst of all developed nations. By every objective measure, the United States has a second-rate health care system.”

It is unclear how soon after Cannes Sicko will open in U.S. theaters. But with the aggressive and often Oscar hungry Weinstein at the distribution helm, there is little doubt that the movie will make a big splash, bubbling up many more controversies. Moore’s film has been a long time coming — three years since his huge success with Fahrenheit 9/11, which was awarded the Palme d’Or (Golden Palm), the festival’s highest award, by an international jury in 2004.

Legend has it that while Moore has been critical of Cuba, he became a hero there after a pirated version of Fahrenheit 9/11 was shown on government-controlled TV. It’s ironic that Cuba showed a free version, because the film has made boatloads of money. According to the Wikipedia, “As of January 2005, [Fahrenheit 9/11] had broken all box office records for a documentary grossing nearly US $120 million in U.S. box office, and over US $220 million worldwide, an unprecedented amount for a political documentary; Sony reported first-day DVD sales of two million copies, again a new record for the genre.”

Only time will tell if Moore can duplicate his success.

Don Hazen is the executive editor of AlterNet.

2007 Independent Media Institute. All rights reserved.

Wal-Mart's version of affordable access

Wal-Mart to open 400 in-store clinics

Reuters
April 24, 2007

Wal-Mart Stores Inc. said on Tuesday that it will contract with local hospitals and other organizations to open as many as 400 in-store health clinics in the next two to three years.

Should current market forces continue, the world’s largest retailer said up to 2,000 clinics could be in Wal-Mart stores over the next five to seven years.

It has said the clinics are expected to boost the health of its shoppers and should also help sales by drawing consumers into its stores.

“We think the clinics will be a great opportunity for our business. But most importantly, they are going to provide something our customers and communities desperately need — affordable access at the local level to quality health care,” said Wal-Mart Chief Executive Officer Lee Scott in a statement.

http://investing.reuters.co.uk/news/articleinvesting.aspx?type=tnBusinessNews&storyID=2007-04-24T174019Z_01_WEN6901_RTRIDST_0_BUSINESS-WALMART-CLINICS-DC.XML

Comment:

By Don McCanne, MD

We desperately need to reinforce our rapidly deteriorating primary care infrastructure. It would provide us with greater access to higher quality, comprehensive health care, and would do so at a lower cost.

The Wal-Mart clinics actually will improve accessibility to the limited services that they offer, and do so at affordable rates. But the clinics would further fragment services that should be provided at the primary care medical home. They skim off the easy, low-cost, bread-and-butter medical services that help pay the overhead expenses of primary care practices. They also fragment patients’ medical records, such as creating uncertainty as to their immunization status, uncertainty in monitoring of their chronic diseases such as hypertension and diabetes, and uncertainty as to medication compliance and drug incompatibilities. These clinics threaten to accelerate the further demise of the medical home.

As long as we continue to reject a comprehensive government solution to our health care crisis, the private sector will always be ready with profitable innovations. Does anyone seriously believe that we should continue to observe from the sidelines the Walmartization of health care? Apparently so, judging by the inertia.

California Senate Health Committee Passes Universal Healthcare Act

As Hundreds Back Guaranteed Healthcare for All

Sen. Kuehl: “there is no limit to the number of market reforms that would be needed to force the insurance companies to do the right thing.”

For Immediate Release
April 18, 2007
Contact: Donna Gerber, 916-919-1226 or Charles Idelson, 510-273-2246.

California’s 2007 healthcare debate moved in to high gear today as the state Senate Health Committee approved two key bills to guarantee healthcare for all Californians before hundreds of people in a packed chamber that filled two rooms.

SB 840, Sen. Sheila Kuehl’s Universal Healthcare Act, and its companion financing bill, SB 1014, passed by 6-4 votes Wednesday night following an impassioned call by Kuehl earlier during the committee hearing for action on the state’s healthcare crisis. There were also statements of support by representatives of dozens of community organizations.

The bill establishes a system similar to an expanded and improved Medicare for all, and is sometimes referred to as a single-payer plan because there is one pool of publicly administered funds for care delivered by the current, mostly private hospitals, clinics, physicians and other providers.

In the lead testimony before the committee, Deborah Burger, RN, president of the California Nurses Association, the principal sponsor of SB 840, called it “the only comprehensive healthcare proposal in the legislature this year.” She called on the legislature to “show the public that it is capable of bold, smart courageous leadership by sending SB 840 to the Governor’s desk.”

Noting the plight of growing numbers of Californians as the current system “crumbles around them,” Kuehl called SB 840 the “true gold standard for affordable, comprehensive healthcare reform” and the means to assure “high quality healthcare for all of us.”

Kuehl sharply critiqued the present insurance-based structure noting that insurance industry innovations are “devoted to schemes to weed out risk aversion” in limiting payment and provision of care, and that the insurers’ way to reduce cost is “by reducing access.”

She warned against incremental reforms, and stressed “there is no limit to the number of market reforms that would be needed to force the insurance companies to do the right thing.”

Burger cited the real life stories of David Welch, RN, Nathan Wilkes, and Bonnie Drew, all of whom had to fight with insurance giants over their coverage (their stories may be viewed at www.guaranteedhealthcare.org). Other proposals being considered in the healthcare debate, Burger added, “are not adequate. They would keep in place and further institutionalize the insurance that victimizes the Davids, Nathans, and Bonnies of our communities.”

Insurance giants and the state Chamber of Commerce delivered the main opposition testimony. Anne Eowan of the Association of California Life and Health Insurance Companies denied that insurance giants “are making excessive profits” or squander up to a third of every healthcare dollar on administrative waste, claiming the latter figure is only 9%-16%.

That brought a rejoinder from Kuehl who noted that “every bill” that seeks to force the industry to spend 85% of every dollar on medical care, and stop siphoning off more than 15% on waste, is vehemently opposed by the insurers.

Sen. Darrel Steinberg challenged the Chamber of Commerce representative Dominic DiMare for not discussing access or quality in its opposition testimony, and to define what proposal it supports to address access, quality, and ever spiraling premium costs. DiMare agreed that “the current system is not working for the businesses of California,” but would not offer a solution.

SB 1014 is the companion bill to SB 840, intended to, as noted in a statement from Sen. Kuehl’s office, fund the guaranteed healthcare system by “drawing in current public spending and replacing all premiums, co-pays and deductibles paid to insurance companies with one affordable premium paid to the system.”

Among the many groups speaking in support of the two bills were Healthcare for All, California, California State Employees Association, Physicians for a National Health Program and its state chapter California Physicians Alliance, California Federation of Teachers, League of Women Voters, Consumer Federation of California, Congress of California Seniors, Consumers Union, American Federation of State, County and Municipal Employees, Older Women’s League of California, and California Church IMPACT (the legislative advocacy arm of the California Council on Churches).

Other opponents include the Blue Cross, Blue Shield, Health Net, Kaiser Permanente, California Association of Health Plans, California Association of Health Underwriters, and the National Association of Insurance and Financial Advisors of California.

An Analysis of the Literature on Disease Management Programs

Some states, like Vermont, are considering expanding access to care with savings from “disease management.” Unfortunately, the CBO found that there is no evidence that disease management saves money. After taking into account the cost of running the program (often subcontracted to a drug company spin-off) disease management may actually raise costs, as it did in the Florida Medicaid program.

Read the analysis from the CBO

Evansville native to address need for national health plan

By Tom Raithel
Evansville Courier & Press
Wednesday, April 18, 2007

An Evansville native who is now a physician campaigning for a national single-payer universal health plan will bring his message home May 3 in a speech at Central Library’s Browning Events Room.

Dr. Rob Stone, an emergency room doctor in Bloomington, Ind., is a leader in Hoosiers for a Commonsense Health Plan, an Indiana affiliate of Physicians for a National Health Plan.

Stone said the group’s mission is to educate the public and the Legislature about the benefits of a “publicly financed and privately delivered” national health insurance plan that would provide health care for all Americans.

His presentation, sponsored by the League of Women Voters of Southwestern Indiana, is open to the public.

Roberta Heiman, the organization’s president, said her research of information from the U.S. Census Bureau shows 14 percent of Indiana’s population, or more than 860,000 Hoosiers, are without any health insurance, including 159,000 children. Nationally, she said, the statistics show 44.5 million Americans are uninsured, and more of them live in working families.

Stone, who is medical director of the Community Health Access Program in Bloomington, describes the current health care system as “a non-system of sickness care” with a huge chunk of health care dollars going to insurance company profits rather than patient care.

Stone has been speaking around the state to explain the group’s reform proposal.

The Plot Against Medicare

By PAUL KRUGMAN
Op-Ed Columnist
The New York Times
April 20, 2007

The plot against Social Security failed: President Bush’s attempt to privatize the system crashed and burned when the public realized what he was up to. But the plot against Medicare is faring better: the stealth privatization embedded in the Medicare Modernization Act, which Congress literally passed in the dead of night back in 2003, is proceeding apace.

Worse yet, the forces behind privatization not only continue to have the G.O.P. in their pocket, but they have also been finding useful idiots within the newly powerful Democratic coalition. And it’s not just politicians with an eye on campaign contributions. There’s no nice way to say it: the N.A.A.C.P. and the League of United Latin American Citizens have become patsies for the insurance industry.

To appreciate what’s going on, you need to know what has been happening to Medicare in the last few years.

The 2003 Medicare legislation created Part D, the drug benefit for seniors — but unlike the rest of Medicare, Part D isn’t provided directly by the government. Instead, you can get it only through a private drug plan, provided by an insurance company. At the same time, the bill sharply increased payments to Medicare Advantage plans, which also funnel Medicare funds through insurance companies.

As a result, Medicare — originally a system in which the government paid people’s medical bills — is becoming, instead, a system in which the government pays the insurance industry to provide coverage. And a lot of the money never makes it to the people Medicare is supposed to help.

In the case of the drug benefit, the private drug plans add an extra, costly layer of bureaucracy. Worse yet, they have much less ability to bargain for lower drug prices than government programs like Medicaid and the Veterans Health Administration. Reasonable estimates suggest that if Congress had eliminated the middlemen, it could have created a much better drug plan — one without the notorious “doughnut hole,” the gap in coverage once your annual expenses exceed $2,400 per year — at no higher cost.

Meanwhile, those Medicare Advantage plans cost taxpayers 12 percent more per recipient than standard Medicare. In the next five years that subsidy will cost more than $50 billion — about what it would cost to provide all children in America with health insurance. Some of that $50 billion will be passed on to seniors in extra benefits, but a lot of it will go to overhead, marketing expenses and profits.

With the Democratic victory last fall, you might have expected these things to change. But the political news over the last few days has been grim.

First, the Senate failed to end debate on a bill — in effect, killing it — that would have allowed Medicare to negotiate over drug prices. The bill was too weak to have allowed Medicare to get large discounts. Still, it would at least have established the principle of using government bargaining power to get a better deal. But in spite of overwhelming public support for price negotiation, 42 senators, all Republicans, voted no on allowing the bill to go forward.

If we can’t even establish the principle of negotiation, a true repair of the damage done in 2003 — which would require having Medicare offer seniors the option of getting their drug coverage directly, without involving the insurance companies — seems politically far out of reach.

At the same time, attempts to rein in those Medicare Advantage payments seem to be running aground. Everyone knew that reducing payments would be politically tough. What comes as a bitter surprise is the fact that minority advocacy groups are now part of the problem, with both the N.A.A.C.P. and the League of United Latin American Citizens sending letters to Congressional leaders opposing plans to scale back the subsidy.

What seems to have happened is that both groups have been taken in by insurance industry disinformation, which falsely claims that minorities benefit disproportionately from this subsidy. It’s a claim that has been thoroughly debunked in a study by the Center on Budget and Policy Priorities — but apparently the truth isn’t getting through.

Public opinion is strongly in favor of universal health care, and for good reason: fear of losing health insurance has become a constant anxiety of the middle class. Yet even as we talk about guaranteeing insurance to all, privatization is undermining Medicare — and people who should know better are aiding and abetting the process.