FOR IMMEDIATE RELEASE
January 28, 2009

CONTACT: Public Citizen
Phone: 202-588-1000

WASHINGTON – January 28 – Public Citizen has joined the Leadership Conference for Guaranteed Health Care because a single-payer national health insurance program is the only viable solution to our health care crisis.

We have a fragmented health care system that is driven by corporate profit and greed. Although private insurers provide coverage for less than two-thirds of Americans, they drive up administrative costs for everyone so that, on average, 30 cents of every health care dollar is spent on administration, much of this wasted. As a result, costs are skyrocketing and 50 million Americans are left without health insurance. Tens of millions more have insurance but are still unable to afford the care they need.

I am a health researcher with Public Citizen and a practicing internist. It is common for my patients to be taking 10 or more medications, some of which are life-sustaining, and for them to require frequent visits with their physicians. With frightening regularity, I see patients who cannot get their prescriptions filled or afford co-payments for office visits.

As a result, many become ill enough to require hospitalization, and some even die. I recall taking care of a veteran who developed nearly fatal kidney failure from an enlarged prostate because he was too poor to afford private coverage but made too much to be covered by Medicaid or the Veterans Health Administration. And I think of a young woman with diabetes who is admitted to the hospital every month with a complication or new infection because she cannot afford the insulin that keeps her out of the hospital. It is sad and unconscionable that cases like this have become commonplace.

During this recession, we can expect even more people to lose their health care coverage, resulting in more missed doctor appointments and unfilled prescriptions. The estimated 20,000 people who die each year because of a lack of health insurance will rise faster than we could have feared. Also, illness due to a lack of health care only feeds the cycle of missed work days and lost jobs, reducing our economic productivity. Our country cannot recover from this recession if we become sicker with every passing year.

The time for delaying meaningful health care reform because of narrow interests is over. We must eliminate private insurance companies as middlemen who divert health care dollars from real care and are responsible for massive administrative waste. Other proposals for health care reform do not address this fundamental problem of waste and will not reduce costs. A single-payer system is the only way to provide everyone with comprehensive care, regardless of their ability to pay, while keeping costs down. It is also the most just one.

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Public Citizen is a national, nonprofit consumer advocacy organization founded in 1971 to represent consumer interests in Congress, the executive branch and the courts.

Do Not Resuscitate: Why The Health Insurance Industry is Dying and How We Must Replace it
by Dr. John Geyman
Common Courage Press

Reviewed by Theresa Welsh

DOES OUR INSURANCE ACTUALLY PROTECT US?

In this highly researched and well-written book, Dr. John Geyman lays out in clear language the repeated failure of the private health insurance industry to bring affordable and comprehensive coverage to the American people. He demonstrates with a wealth of facts and figures how the inexorable and continuous rise of health care costs have meant insurance companies must work hard at excluding anyone who might require expensive treatment, reduce coverage for everyone and constantly raise premium rates.

This has led to awareness on the part of the public that their insurance may not protect them from medical bankruptcy. Americans now see that a serious illness can run up huge debt, wipe out their retirement savings and even mean selling their home to pay the bills. With this new public awareness, it is more and more difficult for health insurance companies to paint themselves as having the answer to our health care woes.

FOCUS ON PROFITS, NOT PEOPLE

The insurance industry was not always as focused on profits as it is now. Geyman takes us on a tour through the history of private coverage, showing how the original Blue Cross/Blue Shield plans were about spreading risk across a broad pool and keeping coverage affordable. As commercial carriers came into the market, they brought with them “medical underwriting” which looks at applicants in terms of how much they might cost the company. For-profit companies structured their coverage to minimize their risk (by denying coverage to those who need it the most) and maximize their profits. The Blues could not survive without doing the same thing. Today, most of the Blue Cross companies are for-profit, many having been acquired by one of the big players in health insurance.

While Congress has required employer-sponsored group insurance to take everyone in the group and charge them all the same rate, companies are free to deny coverage to people who apply on their own and to offer unaffordable rates to older, sicker people. Companies have a long list of risk factors that trigger a denial. Some of these: leukemia, schizophrenia, emphysema, obesity, high blood pressure, AIDS… and the list goes on. Here’s some reasons used by California insurers in 2006 to deny coverage: attention deficit disorder, breast implants, infertility, herpes, gender reassignment, migraines, miscarriage, bed-wetting, ringworm, varicose veins… and more.

PUBLIC HEALTH INSURANCE PROFITING PRIVATE COMPANIES

Health insurance is largely regulated by the states, so there is great variation in what insurers can do. In many states, for example, coverage can include a lifetime dollar limit. The large players in health insurance operate nationally and can find many ways to game the system. While these companies like to disparage government health care programs, they have been quick to jump on the bandwagon of these same programs when they could profit from them. The Bush administration didn’t think it worthwhile to increase funding for SCHIP (the Children’s Health Insurance program) but allowed private insurance to profit by offering “Medicare Advantage” policies to Medicare recipients that pays companies an override over the cost of original Medicare, and it gave a windfall to the pharmaceutical industry through its so-called drug benefit; this is a boondoggle that is totally structured to “benefit” only the insurance and drug companies. Insurance companies have also been allowed into Medicaid, which is administered by the states, and, though it is supposed to cover health care for the poor, often has such a low threshhold that few qualify (and when they qualify, they have to constantly requalify).

It is partly this rush to profit from government programs that leads Geyman to his conclusion that the health insurance industry is a dying industry. With Americans demanding reform, the current health insurance industry has two enormous costs that are not present in publicly-funded coverage: The huge profits they take out and their lower efficiency.

AVOIDING “MEDICAL LOSS”

Health insurance companies regard the payments they make for subscribers’ health care as “medical loss.” Most try to keep this “loss” at under 80% (meaning they keep 20% of premium payment for administration and profit). This reminds me of another practice that I found outrageous when I first read about it. Pharmaceutical companies see opportunity in illness. They refer to various diseases as “markets” – as in “the cancer market” or the “diabetes market.” Our disease is their profit center. For insurance companies, their profit center is healthy, younger people, certainly not those who actually need health care – insuring them would increase their “medical loss.” These companies operate to retain their profit centers, and profits trump helping people.

Private insurance is massively less efficient than public insurance because of the large workforce needed to do underwriting, claims processing and denials. Some companies even do “rescissions” — canceling someone’s insurance when they get sick by claiming they lied or misrepresented something on their application. Between 2000 and 2005, despite a drop in the number of people with private insurance, their workforce grew by one third. How can this industry possibly bring down the cost of health care and provide affordable coverage? They can’t. Geyman explains that the industry “is pricing itself beyond the reach of a declining private market, even as it seeks out a broader, subsidized role in public programs.”

WHAT VALUE?

Geyman discusses something not mentioned by supporters of reform that involves keeping private insurance, and that is the fact that they are allowed to offer so-called “insurance” that is so skimpy it really provides no protection. Many are marketing “Limited Benefit Policies” (LBP) to younger and lower-paid workers. Aetna Affordable Health Choices caps hospital benefits at $2000 and accident/ER benefits at $1000. I know from my own experience in an ER a few years ago that bills are typically much higher than that (mine was around $2500 for 4 hours in the ER!) and that $2000 hospital cap will barely pay for the aspirin and bed pan.

Interestingly, Geyman also mentions “Medigap” plans as low value. My husband turned 65 one year ago and we studied the government Medicare website to get information on these plans. I was delighted to find that these plans are regulated according to what’s covered and identified by letter (plan A, plan B, etc). We looked at all of them, got costs from different companies and looked at my husband’s usual use of medical services and concluded that these plans were not a good deal. Over the long run, we would be better off paying out of pocket costs not covered by Medicare. We concluded the same thing about the so-called drug benefit. None of the plans were cheaper than just paying for the relatively inexpensive medications my husband takes.

Another sleazy trend not mentioned by Geyman is the rise of “health care discount” programs that often masquerade as insurance. People sign up at reasonable rates, get a nice plastic card for their wallet, then find all they have is a discount on health care services, if they can find a provider who will actually give them the discount (it may be the same discount they could negotiate on their own). I am also personally alarmed at the ads on TV that exploit the rising fear over health care costs. These commercials openly cite high health care costs and one even quotes the Harvard study showing that medical bills are the leading cause of personal bankruptcy. They hope your fear of being a health care victim will get you to buy whatever they are selling. Beware!

THE SAME OLD IDEAS: THEY DON’T WORK

Geyman explores the various incremental reforms that have been tried and shows how none have solved the problem. During the 2008 presidential campaign, we heard about “mandates” that, along with community rating (charging everyone the same rate) and guaranteed issue (having to take all who apply), was supposed to insure everyone and bring down costs. But employer mandates are ineffective because of the inherent weaknesses and unfairness in a system relying on employer-sponsored insurance. The “individual mandate” as implemented in Massachusetts has proved unworkable as well, as the state agency (the Connector) tasked with making sure everyone has coverage has exempted thousands of people from the fines because they cannot offer these people any coverage they can actually afford.

The idea that insurance companies will “compete for your business” is an absurdity, given the priorities of health insurance companies (low “medical loss” and high profits for shareholders). Geyman states the problem clearly:

“…private insurers don’t compete with each other by delivering better care at lower cost. That would be in line with what is understood as a classical form of competition where the consumer comes out on top. Insurance competition is different: Who can avoid the most enrollees with higher medical costs, and who is most effective at delaying or denying payment when they can?”

READ THIS BOOK!

This book was written before the financial meltdown and the election of President Obama, but Geyman mentions the possibility of serious recession a number of times in the book. Geyman has done his homework. Every chapter has a huge bibliography, with all sources listed. The book is full of charts and tables. Geyman is not just expressing his own negative opinion of the industry, but writes from facts. I highly recommend this book as the best exposition of why private insurance cannot get us to universal, affordable health care.

Americans have never needed health care reform more than they do today, with so many on fragile financial ground. Most of us are one illness away from financial disaster. The insurance industry, the pharmaceutical industry and the medical device industry will all fight any meaningful reform, and we will probably see a rollout of Harry and Louise type ads once again, warning us about the dangers of “socialized medicine.” But this time, the public might be a bit more aware of how insurance companies actually operate and in whose interests. Harry and Louise might have changed their tune as well and maybe they are ready to reject the false promises of a failed industry.

by Donna Smith

WASHINGTON, DC – It seems everyone in the healthcare reform movement is hitching up his or her britches and feeling mighty proud of the prospects for action under President Obama and the adoring Democrats in his Congressional arsenal. Even some prominent Republicans are inching ever closer to supporting change to the broken health system. But I’m feeling significant dissonance between the words spoken and the policy offered to move forward.

So listening to the speakers here at the Families USA Health Action meeting this week has been upsetting – OK, it is outrageous to watch these folks being self-congratulatory while also promoting those purporting the overhaul of the health system with the biggest bailout we’ve yet given any industry in recent months. The proposed mandates for all Americans to purchase private, for-profit health-insurance (or buy into a public pool that will be weakened by the insurance interests) is being sold to us as reform and it simply is not. And my brain hurts from the disconnect.

I cannot reconcile Princeton’s Uwe Reinhardt’s message that we’ve become an aristocracy – not a middle-class society or even a democracy – with his embrace of the insurance industry and expansion of the broken healthcare system that clearly provides better healthcare protection for our American royalty and not the peasants among us. He carefully charts for us the rising debt of American families – including crushing medical debt assumed under the for-profit health insurance based system-and the lack of savings by Americans in recent years. But there is little acknowledgement that some of the debt and lack of savings directly relates to the increased costs American families and workers must shoulder for health coverage – health coverage that doesn’t adequately protect financial standing.

Sen . Charles Grassley of Iowa assured the crowd that there’s a big difference between the Hillary Clinton plans of years gone by and the Obama plan now – “He (Obama) will stick to his guns on a private-public mix (for insurance).” Grassley goes on to say everyone knows you get over-utilization when you have “gold-plated” plans. The implication is always that if you give access to care then millions of us will clamor to sit in doctors’ offices and get procedures and tests done simply because we have the means to do so. I actually think the gold-plated stuff will be reserved for Sen. Grassley and his cohorts – the rest of us will work hard to even get a plan that can assure minimal coverage or care. Grassley said they’d remind the Democrats that they said they’d adhere to a “pay as you go” with healthcare reform and other programs. Here’s the nod to the “bi-partisan” efforts we hear will guide the day for us all – the new agenda, the cooperation that will bring us all to the promised land of expansion of the insurance industry.

Then the Dems. I hear Rep. Steny Hoyer rightfully site his outrage about a Maryland child dying for want of a tooth extraction, yet stay safely and clearly away from angering the insurance industry. I listen as Sen. Debbie Stabenow of Michigan talk about her compassion for families struggling for care yet quickly adding when she talks about providing healthcare for immigrants that we should reward with healthcare those doing “the right thing.” I have a hard time reconciling the disconnect between the suffering unfolding every day – death by death by denial by denial – as the dance continues.

We want a “uniquely American” answer to the healthcare nightmare, they all say. I’ve heard that until my brain hurts just considering it. Oh, we’re unique all right. We’re the only industrialized nation on earth that tolerates the killing of its citizens on our own soil at the hands of this healthcare system and then wants to fix it all by handing more business, more money and more power to the same industry committing the murders. That’s unique enough.

None of this sounds like the language of basic human rights. And I think I heard our new President say that he clearly understood healthcare to be a human right in response to a debate question just a few months ago. That was such a gift just to hear the words spoken. I just know he knows that this basic human right is not going to be protected by hoodwinking the American people into bailing out the insurance industry.

The heavily funded activists (come on folks, that alone should send up big, red flags – heavily funded activists for human rights?) pushing for a private-public national healthcare policy are in and of themselves a conundrum to me. I hear on the one hand the message that the private, for-profit health insurance industry is very bad indeed – blocking healthcare through denials and high premiums and all the practices the American people have had to endure for years. But then I also see the activists and the industry folks co-mingling ever so deftly in a dance of political theater aimed at convincing us all that in response to demands for insurance regulation and restriction the industry will put up a fight but then capitulate to the demands or risk being left behind.

Look at the list of bedfellows and trust your instincts America. Like our moms and dads taught us, if it walks like a duck and quacks like a duck, guess what? It’s a duck. A bailout called healthcare reform is still a bailout even if we’re told otherwise. If AARP and UnitedHealth Care and Wal-Mart and SEIU and the others in the HCAN coalition are joining hands and forces, is there anyone among us who doesn’t know that’s about money and power and influence still? That’s a duck. And that’s going to be a very well treated duck.

So, let me get this straight… the insurance industry has been a big part of the problem. Worse. The industry has allowed the deaths of tens of thousands of Americans every year in order to protect profits.

I think of dead — 2-year-old Mychelle Keyes and dead 17-year-old Nataline Sarkisyan and dead 38-year-old Tracy Pierce, and that dead little boy with an infected tooth in Maryland — and I don’t wonder at all what the new for-profit insurance-friendly political coalitions are fighting to protect. And it isn’t the future Mychelle’s or Nataline’s or Tracy’s. They are fighting to protect the folks who killed them.

All of these dead were killed at the hands of the industry now being simultaneously chastised and coveted. This same greedy industry can be trusted to roll over just a little while helping craft their own industry’s regulations going forward? Oh, yes, that seat at the table is firmly fixed and being kept ever so warm for the insurance folks. In exchange for setting some of their own regulation, the insurance industry will be rewarded with the business of millions more of us who have had absolutely no say in the matter. None.

Those Americans not acting as political operatives for the quasi-activists organizing the reform transition for the insurance industry are not exactly anxious to hear from you and me. No, they have well-heeled and well-connected leaders who rub elbows and move easily within all of the halls of power where we can never go.

And unless we rise up and say we know what is going on and we smell a lot of big, fat rats, reform that expands the broken system and enriches the already elite of the healthcare profit-mongers will be sold to us by bipartisan bluffing and insurance company operatives slip-sliding us forward.

As for me, I will keep listening to Rep. John Conyers talk about human rights and healthcare for all and the long arc of history leaning towards justice. Oh, and his talk about how the automakers just barely across the river in Canada can build cars much more cheaply than in his native Michigan because they don’t suffer the health-insurance nightmare. Huh? Human rights and good business. I do like the quack of that. And my dissonance subsides…

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Donna Smith is a community organizer for the California Nurses Association and National Co-Chair for the Progressive Democrats of America Healthcare Not Warfare campaign.

by John R. Battista, M.D.
Prepared for Grand Rounds, Department of Medicine, Stamford Hospital, Stamford, CT
October 8, 2008

The United States is the only industrialized country without universal health insurance. The United States consistently ranks in the lower third of industrialized nations in terms of the two universally accepted measures of health care system efficacy: infant mortality and life expectancy. In addition, because the United States spends about twice as much per capita on health care than other industrialized countries it ranks at the very bottom of the industrialized world in terms of health care efficiency, that is efficacy per dollar spent. Furthermore, health care expenses are the leading cause of bankruptcy in the United States, a phenomena which is absent in other industrialized countries. Finally, the US ranks at the very bottom of the industrialized world in preventable deaths and satisfaction with the health care system. When the World Health Organization ranked world health care systems in 2000, the United States ranked 37th, the worst in the industrialized world.

It is generally accepted that universal health care systems improve the efficacy of a health care system by improving access to health care. This is consistent with the finding that the United States health care system provides less outpatient and inpatient care per capita than the health care systems of other industrialized countries.

Thus, our ability to evaluate proposals for US health care reform would be furthered by an understanding of how other industrialized countries succeed in providing universal, comprehensive coverage with more health care and better outcomes at about half our per capita costs. Interestingly, the major factor in understanding this capacity of other industrialized countries relative to the US is not to be found in pay differentials, or the differential use of surgery, lab tests or high tech procedures; but rather, in the nature of the health insurance funded as well as how that insurance is paid for and administered.

First, other industrialized countries guarantee or mandate universal health insurance thereby avoiding both the poorer health care outcomes and the increased health care expenses associated with the uninsured. The uninsured, by avoiding medical care early in the course of illness become more ill than the insured population and die younger. Furthermore, because they seek more emergency care and end up being treated later in the course of an illness, when it is both more difficult and expensive to treat, they end up spending more for health care than the insured. For example, hundreds of thousands of avoidable hospitalizations are incurred each year in the United States due to lack of health insurance.

Second, other industrialized countries insist on comprehensive health insurance covering preventive care, outpatient care, inpatient care, medications, long term care and dental care. By covering all health care expenses they lower the cost of insurance for these expenses by making sure there are no uninsured in any aspect of the health care system. In addition, they lower the cost of insurance for each aspect of the health care system by spreading the expenses across the entire population even when some aspects of health care, such as long term care, are utilized by only a small percent of the population at any given time. Finally, comprehensive insurance saves money by avoiding the additional administrative expenses of having multiple insurance programs to cover the full spectrum of medical care as is characteristic of the United States.

Third, other industrialized countries insist insurers operate not-for-profit and without managed care. For-profits pay higher salaries than not for profits, and on top of that they currently consume about 13 percent of health care premiums in profit, as well as having additional expenses associated with managing care. Repeated studies have shown the same services delivered by for profit Medicare, for-profit nursing homes, or for-profit hospitals would cost about 19% less if delivered through non-profit means. In addition, unmanaged care has been shown to result in a higher quality of care on all recognized quality of care indicators and to be associated with a lower risk of death, thus improving efficacy.

Fourth, other industrialized countries minimize the number of insurers. The number of insurers is directly related to administrative costs. Countries with a single, comprehensive insurance plan, so called single payer countries, such as Canada, have the least insurance overhead. Countries with multiple, comprehensive insurer plans, such as France, with three, and Germany, with about two hundred, have higher insurance administrative costs.

The United States with over 1400 insurance companies and multiple insurance plans within each insurer, almost none of which are comprehensive, and almost all of which operate for-profit, reveals the vast savings power of these first four insurance principles utilized by other industrialized countries. In the United States at least 25% of total health care expenses are consumed by insurance billing costs, about the same percent used to reimburse health care providers. This contrasts with less than 3% in other industrialized nations. Since 1970 billing administrators have increased 2500% relative to physicians in the US while this ratio has not changed significantly in other industrialized countries.

Fifth, other industrialized countries have lowered their cost of health insurance by negotiating the price of prescription drugs and bulk purchasing prescription medications and durable medical equipment, thereby saving about 50%. This approach has been utilized by the VA, Medicaid and HMO sectors of our health care system, but has been prohibited by law from traditional Medicare. Savings of up to 5% of total health care expenditures could result from the full adoption of these practices.

Sixth, some industrialized countries have lowered the cost of health insurance by capitating the expenses of hospitals and physician services, thereby eliminating the cost of billing for these services. This practice runs contrary to the fee for service values of American culture and has little support among American health care reform advocates.

Seventh, other industrialized countries have lowered health insurance costs by funding these costs in relation to income rather than risk. In other industrialized countries the total cost of health care for the entire population is determined and divided among the population so that each person, or employer, pays the same percent of their income, or payroll, for insurance to cover all these expenses. In the United States the private insurance population is fractionated into groups and the cost of the insurance is calculated by assessing the health risk of the group or a particular individual within such a group for the specific medical services the insurance will cover. The factors typically involve age and illness history. As a consequence, health insurance is more expensive the older and sicker you are. Additionally, because the cost is not modified by income, risk based pricing makes health insurance unaffordable to most hourly workers.

This method of making health insurance more affordable is at the heart of the health care reform dilemma for the United States. The only way health insurance can become affordable for a substantial proportion of the uninsured population of the United States is to adopt community financing of insurance and pay for that financing as a percent of income earned. To do so requires financing health insurance through a public tax mechanism rather than a private billing mechanism. Yet, this solution is opposed by a wealthy and powerful minority of people in our country who falsely consider such a solution to be socialism and believe that any socialized health insurance funding mechanism would be inherently inefficient and ineffective, despite consistent evidence to the contrary.

A fuller understanding of these seven means of saving cost and improving outcomes can be furthered by examining the three distinct ways they have been utilized by other industrialized countries: the socialized medical system of Great Britain and Spain; the single payer system of Canada, Taiwan and Scandinavian countries; and the not-for-profit multi-payer system of Germany and France.

In socialized medical systems the population is insured through public funds obtained through an income tax and a value added tax. The government owns the health care facilities. Physicians are paid a salary to work in hospitals, and a capitated rate to treat outpatients. Hospitals operate on a global budget. There is no billing for services. Both Great Britain and Spain allow individuals to opt out of this public system by paying for private health care. Such systems tend to be underfunded and have waiting lines for non-acute services. They are much less costly than the US system while delivering generally comparable outcomes. There is little or no support for such a system for the United States where there is a strong belief that physicians should be paid fee for service and there should be free choice of health care providers, which is not characteristic of socialized health care systems.

In single payer medical systems the entire population is covered by comprehensive health insurance administered by a single organization. Funding is accomplished through public funds for the unemployed, poor, disabled and retired in combination with an income based health care tax on working families and a payroll tax on employers. These funds go into a health care fund, not general revenue, which is administered by a regional public office in accord with national policy. Rates and coverage are set by regional administrators in negotiation with health care providers. Health care workers are paid fee for service. There is no managed care. There is free choice of health care providers.

This is the system most health care reformers advocate for the United States. However, they suggest the single-payer system be administered by a not-for-profit trust controlled by a board of health care providers, health care advocates, taxpayers reportable to government, rather than being operated by the government itself. Prospective studies suggest this system could deliver comprehensive health care, without co-pays, for all Americans with a 6.5% income tax and a 6.5% payroll tax while maintaining the current funding for the Medicaid, Medicare and CHIP’s programs which would be upgraded into comprehensive insurance without additional funding. This system would improve health care outcomes for the United States while constraining costs and making health insurance much more affordable for the entire population.

This single-payer model is supported by about 60% of the population and physicians, but has limited support among politicians who wish to maintain the private insurance industry. In the current presidential race, single payer health care reform is supported only by former US Congresswoman Cynthia McKinney, the Green Party Candidate, and Ralph Nader, who is running as an independent.

The third form of universal health insurance in other industrialized countries involves using the tax mechanism to fund large, quasi-public, not-for-profit insurance pools. These not-for-profit insurance pools are highly regulated, quasi-public institutions which share profits and losses, and offer only one comprehensive health insurance plan. They are funded through a health care tax, an employer payroll tax, and public funds for the unemployed, disabled and retired. They have little or no resemblance to American for-profit insurers. They are not publicly traded companies with a fiduciary responsibility to stockholders. Instead, they are not-for-profit, quasi-public institutions with a responsibility to the people they insure which negotiates on their behalf with health care providers for fees and services. Such a system has co-pays, but utilizes a mandated cap to insure there is no medical bankruptcy There is no managed care. There is free choice of health care providers.

American politicians, who support universal health insurance but wish to maintain private insurance companies have been interested in altering the multi-payer system of Germany and France by mandating health insurance coverage while leaving the private, for-profit, health insurance system intact. This individual mandate is commonly combined with a mandate on employers to provide health insurance for their workers or pay into a public fund to assist workers in obtaining health insurance. This was the position of Hillary Clinton and Mitt Romney in their campaigns for President. A mandate on health insurance for children is advocated by Barak Obama, although he does not support a mandate on health insurance for adults.

Mandate systems can result in universal coverage. However, international experience suggests this can only be accomplished when the payments for a mandate are collected through payroll and income taxes with the government taking up responsibility for the non-employed population. In addition, a mandate system would need to require comprehensive health insurance coverage and caps on out of pocket expenses to solve the efficacy and bankruptcy problems of the United States health care system. Bare bones, major medical insurance with payment limits would do little to solve the efficacy problem for the United States because such coverage would continue to result in inadequate health care access while doing little to stop the problem of medical bankruptcy. In fact, the vast majority of people bankrupted by health care bills had health insurance at the time they developed a major medical illness. The simple truth is you can not make private health insurance affordable for the hourly, sick and near elderly worker unless you make it inadequate or substantially subsidize its cost with public funds. That is because the overhead on private for profit insurance companies is much higher and their use of risk based accounting practices commonly makes it unaffordable for those segments of the population who are most likely to be uninsured: the sick, the near elderly and the hourly workers. Thus, a mandate on health insurance will most likely result in a decrease in the number of uninsured coupled with an increase of publicly subsidized, non-comprehensive health insurance with payment limits in order to lower the cost of the insurance to both the individual and the state, as has occurred in Massachusetts. This kind of increased coverage will do little or nothing to solve the efficacy or bankruptcy problems of the United States. None the less, this is one direction health care reform in this country may be headed despite clear evidence that more effective and more efficient universal health insurance could be obtained through a publicly funded comprehensive insurance program.

John McCain, the Republican Presidential nominee, does not support health care mandates. Instead he would offer incentives to private health insurance coverage by making employer health insurance taxable, combined with a $5,000 tax deduction for private health insurance and the deregulation of state health insurance requirements to make private insurance plans cheaper. This plan, if enacted, would further erode employer-based health insurance by increasing the cost of such insurance through providing an incentive for young, healthy workers to reject it. Furthermore, it is anticipated to result in an increased numbers of Americans who would be covered by inadequate health insurance thereby worsening the health care efficacy and medical bankruptcy problems in our health care system. It might decrease the number of uninsured in the short run by making private health insurance more affordable, but increase the number of uninsured in the long run as privately insured people would find they no longer can afford private health insurance as they become older or ill.

Barack Obama, the Democratic Presidential nominee, supports allowing individuals to purchase health insurance through the Federal Health Benefits Program in addition to a mandate on health insurance for children. Opening the Federal Health Benefits Program to all Americans would lower the cost of health insurance for older Americans and sick individuals who are unable to afford private health insurance. It would not solve the problem of making health insurance affordable to the hourly workers. He thus proposes to subsidize the cost of purchasing health insurance for such individuals. Such a program would substantially decrease the number of uninsured but would not address the higher administrative cost of health insurance of the private sector and the poor efficacy that results from their use of managed care. In addition, it would not solve the problem of bankruptcy which results from the lack of comprehensive insurance coverage and the existence of limits on insurance payments.

In summary, although publicly funded health insurance administered through a single payer option is empirically the most cost effective means of lowering the cost of health insurance and improving the efficacy of the American health care system, the two major parties have rejected this approach because of their support for the private insurance system and the pharmaceutical industry, coupled with an irrational belief that for-profit, free market health care reform will solve the problems of our current health care system. In addition, single payer has been grossly misrepresented as a government run, socialized medical system that would cost more and result in waiting lines. The main hope for passage of a publicly funded comprehensive and universal health care system for our country lies in its passage at the state level and having such a system spread to the national level, much as occurred in Canada. In addition, the public funding of elections, the inhibition of politicians from receiving financial benefits from corporations and lobbyists while in office, and the development of multi-party politics in the United States would all benefit the possibility of publicly funded, comprehensive health care reform for the United States. For now, advocates of a single payer health reform can be heartened by its increasing support among physicians and the general population and can take solace in the belief that its passage in the United States is inevitable as other health care reform options, such as individual mandates, are tried and fail, and the health care crisis in this country continues to worsen. The current health care reform situation is very much as Winston Churchill described it: “You can count on Americans to do the right thing- after they’ve tried everything else.”