By Claudia Chaufan
The Social Medicine Portal, Jan. 7, 2010
I must confess that I was disappointed to see Dr. Atul Gawande’s mantra that more or more expensive care is not necessarily better care go unchallenged even by the otherwise outstanding Amy Goodman’s “Democracy Now.” Unchallenged, that is, when this rather obvious (or at least very reasonable) observation was presented as the critical explanation for why the United States spends more in health care, per person, than any other country in the world, even as it leaves millions uninsured or underinsured, leads thousands to bankruptcy, and allows 45,000 people — 15 times the number murdered in 9/11 — to die for lack of health insurance. Nor was he challenged when he presented his views of Massachusetts as a sound model for health care reform, even as he granted that the program had “failed to control costs.” In fairness to the interviewers, Dr. Steffie Woolhandler’s statement that the center of the Massachusetts program did not hold were shown briefly. Yet to the already confused listener or viewer, the showcase of “opposing expert views” must have felt like the usual “he said, she said” — not awfully enlightening and at best leading to skepticism about both positions.
So back to Dr. Gawande, it appears that he is smart enough to realize that certain forms of payments, like fee for service, lead practitioners to provide more care (which sometimes, but by no means always, may be unnecessary), whereas salaried doctors do not have that incentive (incidentally, salaried doctors are the norm in “socialized medicine”-type systems). And yet, Gawande is not perspicacious enough to ask himself why is it that Canada, Taiwan, France, or Japan, where fee for service reigns supreme, still spend a fraction of even what our cheapest and best run hospitals do. While I am not arguing in favor of fee for service — quite the contrary, I, like many, agree that it at least a very inefficient and administratively burdensome form of payment — I am just pointing out that given this rather banal observation, it is clear that fee for service cannot be the whole story of our high health care costs.
At any rate, had Gawande (or his interviewers) asked this critical question, rather than continuing in the all-too-American exercise of navel-gazing by comparing one (low-cost) American hospital with another (high-cost) American hospital, he might have studied a well-run, or even the best run, American hospital’s costs against the costs of some hospitals in other countries. And he surely would not have failed to see, as it appears he has, that even Switzerland, that comes second after the United States in health care costs (even if Swiss costs are substantially lower, by around 40 percent, than the U.S.’s), and has “private insurers,” bans profit making from the financing of medically necessary care. Right! It’s the financing, stupid!
The same is the case with the health care of all other industrialized economies. So even when Europeans, or the Japanese, talk about “private” insurers in health care they rarely, if ever, mean “for-profit” insurers. Private insurers are essentially tightly regulated subsidiaries of government, and if they are ever caught “cherry-picking” they are forced to transfer some of their money to another insurer that covered sicker patients or, as the Swiss do, lower their premiums during subsequent months, unimaginable in the America private health insurance scenario.
Admittedly, some readers might puzzle: “Why would insurers even be in business if not to become filthy rich?” Well, at least one reason is that if they do a good job and attract many members, then they can sell for-profit insurance for the “over and above” services (private hospital rooms, cosmetic surgery, etc.). And note, when Swiss insurers, who prior to 1994 were pretty much like American insurers, failed to meet their part of the social contract (i.e. were becoming filthy rich at the expense of everybody else’s suffering), they got their lesson: price controls and mandated benefits that they had to provide at no profit if they wanted to remain in business.
And had Gawande delved into the politics of health care (and not merely the Pollyannaish version of its history), he surely would not have failed to discover that the coming into being of the National Health Services (NHS) was anything but a “historical accident” (and if it was, then anything can be, and the expression is meaningless). It is surely true that the physical structures, the public hospitals, were “already there” after World War II, a war during which hospitals had been built that provided publicly funded medical care for servicemen. Yet it is equally true, and arguably much more important, that around 1948 there was a confluence of critical political forces, not the least of which was the landslide victory of Labor over the Conservative Party.
How did this unexpected victory happen, despite the popularity won by Conservative British Prime Minister Winston Churchill as a “war leader”? It appears that as “national security” concerns subsided and hunger and unemployment began to take their toll over an impoverished population, Britons concluded that Labor, not Conservatives, would be more inclined and capable to guarantee “bread and butter” issues — what were increasingly seen as basic social rights, such as full employment, income security, public education, and health care. Popular demand for guaranteed basic rights was further strengthened by the success of socialist British Minister of Health Aneurin Bevin to secure the support of the medical establishment: in a masterful move, Bevin decided that offering well paid practitioners who agreed to join the NHS generous salaries would free them “from the necessity to drum up business from rich clients to pay for their basic income” (Glennerster 2007: 51). So if the birth of the NHS was a “historical accident,” it was certainly a very complex one.
So Gawande’s conclusion, given the glaring omission in his theory, is unsurprising: it is U.S. doctors, and their “culture,” that are the source of our high costs – doctors, that is, who respond to a perverse systems of incentives, which according to Gawande, is the way U.S. doctors are paid: more for doing more yet not better.
Now, while doctors may certainly be part of the problem, and while paying more for doing more, even if it is not good and frequently not necessary, is obviously a bad thing, why Gawande chooses to ignore the critical and obvious fact that no other industrialized economy, and many industrializing ones (like Taiwan), leaves over 70 percent of its population (even if Gawande has only counted 50 percent) at the mercy of profit seekers when it comes to financing medically necessary care, is anybody’s guess. (Elsewhere I have laid out, and many other excellent policy analysts, like PNHP doctor Don McCanne, have done so as well, why the only way to eliminate financial barriers to medically necessary care is treating health care as a social right and financing it collectively through a tax-based or social insurance system, incidentally the only way to allow the choices that matter – of doctors and medical establishments, not “health plans” or “preferred providers” lists).
But maybe had Gawande acknowledged the obvious, I suspect that his New Yorker article, where he insists that whether insurance is public or private (we are not told whether the profit motive matters) is not that important after all, would not have never become “required” reading in the White House. Indeed, he even might have been kicked out of the sanctuaries where our health care future is being written (or cooked!), as was the case with many brave doctors (Dr. Margaret Flowers comes to mind), who keep on insisting that our politicians put pe
ople before profits.