Business leaders lean toward dramatic health-care changes
Friday, September 16, 2005
By Rick Haglund
TRAVERSE CITY — Frustrated over seemingly never-ending hikes in health care costs, some 40 percent of Michigan business executives polled in a new survey say they support nationalized health care or a privately run, single-payer system financed by the federal government.
The poll of 350 business people, released here Thursday at the Michigan Chamber of Commerce’s annual Future Forum conference, found that 42 percent of those surveyed supported a national health care system. Answering a second question, 40 percent said they supported a single-payer system.
In the wide-ranging survey by pollster Steve Mitchell, business leaders also expressed a deep pessimism about the state’s business climate and Democratic Gov. Jennifer Granholm’s leadership.
Sixty-nine percent said the state’s business climate is on the wrong track, while only 43 percent approved of the job Granholm is doing.
“We have not seen numbers like this since the early 1990s,” Mitchell said.
That was a time when unemployment in the state topped 15 percent. Unemployment currently is at 6.7 percent.
But Mitchell said Granholm’s low approval rating wasn’t too surprising, given the Republican leanings of most business owners surveyed. President Bush got a 70 percent approval rating in the poll.
Also the national economy is doing well, while Michigan’s manufacturing-based economy is struggling, he said.
Granholm’s spokeswoman Liz Boyd said the governor’s 43-percent approval rating by members of a group with close ties to the state Republican Party was “just great.”
Support for universal health care among most Republican business executives was surprisingly high, even in the face of rapidly rising costs.
“This finding that four in every 10 business decision-makers are willing to look at a different way of delivering health care is something you wouldn’t have seen 10 years ago,” said Mitchell, president of Mitchell Research and Communications Inc. in East Lansing.
His poll surveyed Michigan Chamber of Commerce members from Aug. 15-Sept. 1. Of those surveyed, 72 percent represented businesses employing fewer than 50 workers; 16 percent were in manufacturing.
Rich Studley, senior vice president of government affairs at the chamber, said business owners may be looking to the federal government to provide health care because they’re frustrated that their efforts to control costs aren’t working.
And many of the chamber’s small-business members who can’t afford to provide health insurance for their workers, but who would like to, “see that goal just getting farther and farther away,” Studley said.
William Rustem, president of Public Sector Consultants Inc. in Lansing, said the apparently increasing support by business for universal health care could lead to radical reforms. Many business leaders have been reluctant to push for universal health care because the Bush administration and the Republican-controlled Congress are opposed.
“I think this is an amazing result,” Rustem said about the chamber poll. “This may be a recognition by the business community of a public will to do something about health care.”
On Wednesday, the annual Kaiser Family Foundation survey found it now costs U.S. employers an average $10,800 a year to provide health insurance for a family. That’s up 9.2 percent from 2004.
The chamber survey also found the top two problems limiting the hiring of workers in coming years are a lack of skilled applicants and the high cost of health care.
Among various state taxes, 56 percent of business decision-makers said the Single Business Tax was the most onerous.
Studley credited Granholm with proposing sweeping changes in the SBT earlier this year, even though the chamber has vehemently opposed Granholm’s plan to raise taxes on insurance companies in order to give manufacturing and research companies a break.
He criticized the Legislature for not yet passing SBT reform.
“Every day our members are making decisions about whether to stay in Michigan or leave,” Studley said. “The message we want to send to the Legislature is: For goodness sake, take action.”
Survey Says U.S. Patients Pay More, Get Less Than Those in Other Western Nations
By Rob Stein
Washington Post Staff Writer
Friday, November 4, 2005
Americans pay more when they get sick than people in other Western nations and get more confused, error-prone treatment, according to the largest survey to compare U.S. health care with other nations.
The survey of nearly 7,000 sick adults in the United States, Australia, Canada, New Zealand, Britain and Germany found Americans were the most likely to pay at least $1,000 in out-of-pocket expenses. More than half went without needed care because of cost and more than one-third endured mistakes and disorganized care when they did get treated.
Although patients in every nation sometimes run into obstacles to getting care and deficiencies when they do get treated, the United States stood out for having the highest error rates, most disorganized care and highest costs, the survey found.
"What's striking is that we are clearly a world leader in how much we spend on health care," said Cathy Schoen, senior vice president for the Commonwealth Fund, a private, nonpartisan, nonprofit foundation that commissioned the survey. "We should be expecting to be the best.
Clearly, we should be doing better."
Other experts agreed, saying the results offer the most recent evidence that the quality of care in the United States is seriously eroding even as health care costs skyrocket.
"This provides confirming evidence for what more and more health policy thinkers have been saying, which is, 'The American health care system is quietly imploding, and it's about time we did something about it,' " said Lucian L. Leape of the Harvard School of Public Health.
The new survey, the eighth in an annual series of cross-national surveys conducted by Harris Interactive for the fund, is the largest to examine health care quality across several nations during the same period. The survey was aimed at evaluating care across varying types of health care systems, including the market-driven U.S. system and those that have more government controls and subsidies.
The survey, published in the journal Health Affairs, questioned 6,957 adults who had recently been hospitalized, had surgery or reported health problems between March and June of this year.
"These patients are the canary in the coal mine of any health care system," Schoen said.
Nearly a third of U.S. patients reported spending more than $1,000 in out-of-pocket expenses for their care, far outpacing all other nations. Canadians and Australians came next, with 14 percent of patients spending that much. The proportion reporting similarly high costs was far lower in the other countries.
Americans had the easiest access to specialists, but they experienced the most problems getting care after hours, and Americans and Canadians were the most likely to report problems seeing a doctor the same day they sought one.
Americans were also much more likely to report forgoing needed treatment because of cost, with about half saying they had decided not to fill a prescription, to see a doctor when they were sick or opted against getting recommended follow-up tests. About 38 percent of patients in New Zealand reported going without care; the numbers were 34 percent in Australia, 28 percent in Germany, 26 percent in Canada and 13 percent in Britain.
"If that's not a reason for moral outrage, I don't know what is," Leape said.
About one-third of U.S. patients reported problems with the coordination of their care, such as test results not being available when they arrived at a doctor's appointment or doctors ordering duplicate tests. In the other countries, 19 to 26 percent of patients reported similar problems.
Americans also reported the greatest number of medical errors. Thirty-four percent reported getting the wrong medication or dose, incorrect test results, a mistake in their treatment or care, or being notified late about abnormal test results. Only 30 percent of Canadian patients, 27 percent of Australian patients, 25 percent of New Zealanders, 23 percent of Germans and 22 percent of Britons reported errors.
"The findings show that we have a lot to learn from our colleagues" in other countries, said Carolyn Clancy of the federal Agency for Healthcare Research and Quality during a briefing at which the results were released. She said the federal government has launched a number of initiatives to find ways to improve care, particularly for the increasing number of Americans with chronic illness.
"The findings here reinforce how difficult it is coordinating care. . . . That's the next frontier," Clancy said.
© 2005 The Washington Post Company
Harvard prof touts advantages
By LUKE SHOCKMAN
TOLEDO BLADE STAFF WRITER
Article published Saturday, November 5, 2005
What if picking your doctor or hospital were like buying a car?
Maybe you'd sort through a Consumer Reports-like guide to see which doctor or hospital most reliably saves lives. Next to each hospital or doctor would also be a price.
Using this information, you would then make a decision on which doctor or hospital to choose. Evaluating quality and price is how a lot of transactions - from buying cars and DVD players to choosing a new coat or even a cheeseburger - work in America today.
It's not like that with health care. But maybe it should be, said Regina Herzlinger, a Harvard University business professor who spoke yesterday at the Medical University of Ohio. Her presentation was part of a discussion at MUO called: "Health Care Access, Delivery and Cost: Is the Status Quo Sustainable?"
The short answer to that discussion? No.
Dr. Lloyd Jacobs, MUO's president, said the "course we're on is not sustainable."
Health-care costs are soaring every year, and the number of Americans without health insurance - now about 45 million, which is more than the number of Americans on Medicare - continues to grow.
The situation is "almost at meltdown proportions," Dr. Jacobs said.
Politicians and the American public have ignored this problem for so long that the time for tinkering is over, he said, and it will soon take a massive intervention, likely by the government.
"It's too late for incremental steps. My fear is we're going to experience an upheaval. We'll see the bankruptcy of a large corporation like General Motors [partly because of rising health-care costs] … and we'll end up looking more like Canada," which has a single payer system, he said.
It doesn't have to be this way, Ms. Herzlinger said. Give patients information and direct control over their health-care dollars, and they'll do a better job at holding down health-care costs, she argued.
This theory, which is being embraced by many companies, is known as "consumer-driven" health care. Though businesses are trying to embrace this concept, it's been a struggle because of the lack of reliable information. "I know more about my car, tomato sauce, and panty hose than I do about the doctor or hospital who is about to perform a mastectomy on me," she said.
Ms. Herzlinger said she favors universal health-care coverage, but not a single payer system because it stifles competition. One major criticism of consumer-driven health care being a solution to rising costs is that it's no help to those who can't afford insurance in the first place. Ms. Herzlinger said she supports things like tax credits or other subsidies that would give all Americans access to insurance plans.
Some are still skeptical. Dr. Jacobs, for example, worries that while consumer-driven health care is a good idea, it's not a radical enough step given the sorry state of U.S. health care. Kenneth Raske, president of the Greater New York Hospital Association and another speaker at MUO's forum, is also skeptical.
He said the "structure of our health-care system is collapsing as we speak," and like it or not, a single payer system is on the way. "It won't happen in 2008 or 2010? Maybe. But it's going to happen."
The word in Tennessee is that Gov. Phil Bredesen, a Democrat, has presidential aspirations. I find that interesting. Perhaps he can run on the success he's had throwing sick people off of Medicaid.
Thanks to Mr. Bredesen's leadership, Tennessee is dumping nearly 200,000 residents, some of them desperately ill, from TennCare, the state's Medicaid program. Cindy Mann, a research professor and executive director of the Center for Children and Families at Georgetown University's Health Policy Institute, concisely characterized the governor's efforts:
"What he's decided to do is save health care costs simply by not giving people health care."
How's that for a solution to a tough public policy issue?
What is happening in Tennessee is profoundly cruel. The people being removed from the rolls - some of them disabled, some suffering from such serious illnesses as cancer and heart disease - are mostly working-poor individuals who cannot afford private insurance. They are being left with no coverage and in many instances are in a state of absolute panic.
"People are going to die because of this," said Carolyn Cagle, a widow from Paris, Tenn., whose 34-year-old son, Lloyd, is a diabetic who has already lost part of his right foot. He is being dropped from the program.
Phil Dedrich, a resident of Waynesboro, has also been notified that his coverage is ending. "I am very sick," he said in a statement distributed by opponents of the cuts. "I have severe coronary artery disease, including a 70 percent blockage of my aorta, lung disease, thyroid disease, diabetes, painful neuropathy from the diabetes and high blood pressure."
In addition to the people being dropped from the rolls, benefits are being cut for hundreds of thousands of TennCare participants, and there is a chance that 100,000 more people will lose their coverage next year.
"I'm scared," said Terilyn Gotlieb, a TennCare enrollee whose prescription coverage was reduced sharply. Kidney disease has all but destroyed Ms. Gotlieb's family. She told me her mother, her grandfather, a brother and a sister all died from the disease. Ms. Gotlieb herself underwent a kidney transplant in 2000. She's in constant pain from a broken back she suffered in an auto accident last year, and she's severely depressed.
In a normal month Ms. Gotlieb takes 12 medications, but now TennCare will pay for only 5 and she can't afford the other 7. "I'm scared that if I don't get the right medication, I'm going to end up back on dialysis and lose my kidney I fought so hard to keep," she said. "I could die."
Medicaid was established to provide health coverage for the poor. In the 1990's the TennCare program extended Medicaid benefits to low-income working people who could not otherwise secure health insurance. Among those hailing the program at its inception was Bill Frist, a Tennessee Republican who is now the Senate majority leader. At the time he was the surgical director of the Transplant Center at Vanderbilt University.
Mr. Frist called the program a "bold experiment" and wrote in a newspaper article that "the extension of coverage to working Tennesseans without health insurance is necessary to reduce the need for hospitals to shift these costs to patients who have insurance."
TennCare reduced the number of uninsured residents in the state by one-third and indisputably saved many lives. But the program ran into problems. Parts of it were mismanaged by state officials and by managed care organizations that performed so poorly they either had to be taken over by the state or their contracts were terminated. More insidious is the fact that residents of Tennessee (which limits its state income tax to dividends and interest income) are even less willing than their counterparts in most other states to pay for crucial public services.
So rather than do the heavy lifting necessary to shore up an important and admirable program, Governor Bredesen resorted to the draconian, life-threatening expedient of severing the health coverage of people who have nowhere else to turn.
Perhaps that's what one should expect from a former managed care executive. Governor Bredesen's Web site notes that before entering public service, he "was a successful health care entrepreneur."
By Merton C. Bernstein
Special to The Kansas City Star
Posted on Sun, Nov. 06, 2005
Faced with daunting health insurance costs, American enterprises are eliminating coverage or passing along more of the cost to employees and retirees.
State legislatures, particularly in Missouri, are shrinking Medicaid eligibility and benefits.
There is a better way to tame health-care budgets — eliminate administrative costs by covering everyone through Medicare.
Imagine if the electronics industry used thousands of differently shaped plugs on their appliances, each requiring a matching socket before they could be used. Absurd! But this describes American health insurance: doctors, hospitals, labs and other providers must match their billions of bills with thousands of differing insurance plan provisions, many designed to promote sales rather than sound treatment. Intelligent design? Hardly.
The resulting chaos is unnecessarily costly, with as much as 30 percent of our medical care payments going to process claims. In contrast, in 2004, Medicare administrative costs were 1.9 percent. If Medicare applied to everyone, insurers and care providers would be saved most of what they spend on trying to fit their innumerable plugs into that almost-infinite number of sockets.
Medicare-for-All is the practical answer to the double-digit health-insurance cost increases we’ve faced over the last four years. What’s standing in the way is the outmoded and discredited ideology that the market will discipline health-care costs.
In reality, health-care costs rage out of control. More and more individuals and families lose insurance protection, and medical care charges constitute one of the three major causes of personal bankruptcy. Health-care costs are strangling business and threaten the very existence of many employers with costs that competitors in countries with national health insurance do not face.
State budgets are staggered by the double whammy of having to increase Medicaid outlays for the poor while confronting surging health-care costs of government employees, including teachers.
Health maintenance organizations, touted as a cure, became a disease. Many HMOs collapsed, shriveled or bugged out, stranding their participants. Tax-favored medical savings plans have proven useless, except perhaps to the wealthy.
Tax breaks and other subsidies to encourage coverage only add to total medical care costs, delaying the goal of universal coverage. And as costs escalate out of control, that goal becomes more and more unattainable.
Applying Medicare to everyone would achieve annual savings on the order of $300 billion, enough to cover everyone with a comprehensive plan that surpasses most private coverage and means-tested public programs, even Medicaid.
Establishing and periodically recertifying eligibility for tens of millions of individuals and families under Medicaid incurs administrative costs 5 percent greater than Medicare’s administrative costs. Other federal and state means-tested programs produce similarly unnecessary costs.
For example, Massachusetts operates means-tested programs that use eight different formulas for eligibility and benefits despite similar program goals. Consolidating those programs into Medicare would save tens of billions in administrative costs and give greater assurance that individuals, especially children, would receive timely medical care.
Medicare uses private insurers as intermediaries between providers and patients. These private insurers, under Medicare, operate efficiently and at low cost. Their inclusion in Medicare-for-All would prevent the allegation of “too much government.”
Medicare-for-All would tame costs and make coverage universal. We can readily pay for it by pooling what we already spend on health care. That means no new taxes.
Business, government, individuals and families cannot afford the current costly chaos. It makes economic sense to cut nonbenefit outlays rather than eligibility and benefits.
Those avoidable costs are present but unseen in what we buy or cannot afford. Those unnecessarily higher prices reduce the ability to pay for other needed and desired goods and services. Healthier people incur lower health-care bills, work more productively and avoid the absences and other dislocations that sickness usually brings,
Everyone would be in better hands with Medicare-for-All.
Merton C. Bernstein is a Coles Professor of Law Emeritus at Washington University and a founding board member of the National Academy of Social Insurance.
© 2005 Kansas City Star and wire service sources. All Rights Reserved.
The New York Times
November 7, 2005
By PAUL KRUGMAN
General Motors is reducing retirees' medical benefits. Delphi has declared bankruptcy, and will probably reduce workers' benefits as well as their wages. An internal Wal-Mart memo describes plans to cut health costs by hiring temporary workers, who aren't entitled to health insurance, and screening out employees likely to have high medical bills.
These aren't isolated anecdotes. Employment-based health insurance is the only serious source of coverage for Americans too young to receive Medicare and insufficiently destitute to receive Medicaid, but it's an institution in decline. Between 2000 and 2004 the number of Americans under 65 rose by 10 million. Yet the number of nonelderly Americans covered by employment-based insurance fell by 4.9 million.
The funny thing is that the solution - national health insurance, available to everyone - is obvious. But to see the obvious we'll have to overcome pride - the unwarranted belief that America has nothing to learn from other countries - and prejudice - the equally unwarranted belief, driven by ideology, that private insurance is more efficient than public insurance.
Let's start with the fact that America's health care system spends more, for worse results, than that of any other advanced country.
In 2002 the United States spent $5,267 per person on health care. Canada spent $2,931; Germany spent $2,817; Britain spent only $2,160. Yet the United States has lower life expectancy and higher infant mortality than any of these countries.
But don't people in other countries sometimes find it hard to get medical treatment? Yes, sometimes - but so do Americans. No, Virginia, many Americans can't count on ready access to high-quality medical care.
The journal Health Affairs recently published the results of a survey of the medical experience of "sicker adults" in six countries, including Canada, Britain, Germany and the United States. The responses don't support claims about superior service from the U.S. system. It's true that Americans generally have shorter waits for elective surgery than Canadians or Britons, although German waits are even shorter. But Americans do worse by some important measures: we find it harder than citizens of other advanced countries to see a doctor when we need one, and our system is more, not less, rife with medical errors.
Above all, Americans are far more likely than others to forgo treatment because they can't afford it. Forty percent of the Americans surveyed failed to fill a prescription because of cost. A third were deterred by cost from seeing a doctor when sick or from getting recommended tests or follow-up.
Why does American medicine cost so much yet achieve so little? Unlike other advanced countries, we treat access to health care as a privilege rather than a right. And this attitude turns out to be inefficient as well as cruel.
The U.S. system is much more bureaucratic, with much higher administrative costs, than those of other countries, because private insurers and other players work hard at trying not to pay for medical care. And our fragmented system is unable to bargain with drug companies and other suppliers for lower prices.
Taiwan, which moved 10 years ago from a U.S.-style system to a Canadian-style single-payer system, offers an object lesson in the economic advantages of universal coverage. In 1995 less than 60 percent of Taiwan's residents had health insurance; by 2001 the number was 97 percent. Yet according to a careful study published in Health Affairs two years ago, this huge expansion in coverage came virtually free: it led to little if any increase in overall health care spending beyond normal growth due to rising population and incomes.
Before you dismiss Taiwan as a faraway place of which we know nothing, remember Chile-mania: just a few months ago, during the Bush administration's failed attempt to privatize Social Security, commentators across the country - independent thinkers all, I'm sure - joined in a chorus of ill-informed praise for Chile's private retirement accounts. (It turns out that Chile's system has a lot of problems.) Taiwan has more people and a much bigger economy than Chile, and its experience is a lot more relevant to America's real problems.
The economic and moral case for health care reform in America, reform that would make us less different from other advanced countries, is overwhelming. One of these days we'll realize that our semiprivatized system isn't just unfair, it's far less efficient than a straightforward system of guaranteed health insurance.
Notes on International Comparisons of Health Care
Trends in employer-based insurance
: The underlying data
come from the Census. Here is a shorter, useful summary of the data
.(pdf).International comparisons of health spending
: The Factbook of the Organization for Economic Cooperation and Development, an international research organization supported by member governments, is available at www.sourceoecd.org
. It provides comparative data on many economic, environmental, and social trends. Data on health care spending per capita are measured using “purchasing power parities” – that is, they are adjusted for international differences in the cost of living.
Two things stand out. First, the United States is off the scale in terms of the amount we spend per person. Second, the U.S. system is unique in its reliance on private spending.Quality of Health Care
: “Taking the Pulse of Health Care Systems: Experiences of Patients With Health Problems in Six Countries
(pdf),” is a new study published in Health Affairs. Check out Exhibits 6 and 7, in particular. Taiwan
: A very interesting study, also online, is “Does Universal Health Insurance Make Health Care Unaffordable? Lessons from Taiwan
(pdf).” Since it’s predictable that some of the usual suspects will attack my column by citing newspaper articles about runaway costs in Taiwan, it’s particularly interesting to read the paper’s discussion of how “political theater” – overstating the quite mild financial difficulties of the Taiwanese system – was used to sell a modest increase in premiums.
Nov. 8, 2005
On "Pride, Prejudice, Insurance": Health Care Crisis in the U.S.
Nell Farr, Elk Grove, Calif.
: Your fine column contained this line: “. . . Americans too young to receive Medicare and insufficiently destitute to receive Medicaid . . .” This implies that those under 65 receive Medicaid if only they are poor enough. Many people believe this is true. It is not. Only if a person under 65 is on some Federal aid program such as AFDC or a disability program is he/she eligible for Medicaid. Others have an option of a free clinic, if available, or an E.R. for an emergency condition. However, E.R.’s only stabilize a person if further care or diagnostic work is indicated, such as a mammogram or even chemo for cancer, usually such a person is totally out of luck. They die.
Your columns are usually 100 percent factually correct, and I was disappointed to see this line that reinforces the mistaken belief of most Americans.
Paul Krugman: It's a bit more complicated than that. As I understand it Medicaid covers many children even if the parents aren't on AFDC, and in some cases covers parents too. But you're right that an American can easily be ineligible for Medicaid no matter how desperate his or her financial straits. In fact, that's a big part of the awfulness of how the government is responding to the aftermath of Katrina. But I didn't have space to go into all of that. Remember, 700 words.
Michael Pistorio, Des Plaines, Ill.: While I completely agree that it is a travesty for Americans to be devoid of a national health care solution, I question the rationale of comparing the costs of an American system to that of a foreign system. My reasoning lies behind the simple fact that the U.S. has a population considerably larger than the most populated country that you mentioned, and with this said, I would think that the reason other countries have lower costs is due to the smaller number of prospective participants. Please help me understand.
Paul Krugman: All of these comparisons are per capita: spending per person. So population is taken into account. Or, if you prefer, add up total spending by Western European countries, which have about the same combined population as the United States; you'll find that they spend only about 60 percent as much on health care, but that everyone is insured, life expectancy is higher, and infant mortality is lower.
Philip Lohman, Lakewood, Calif.: You missed making your best argument: the huge difference between levels of overhead in health systems. Somewhere around 30 percent of all expenditures on health care in the U.S. are for administration. This money buys hundreds of millions of pieces of paper and phone calls, plus the salaries of the legions of employees of insurance companies, H.M.O.’s, P.B.M.’s and all the others who are required to make the whole creaky, maddeningly complex mess function. What i t doesn’t buy is a single office visit or prescription.
Similar administrative costs in other countries are around a third of this. Compared to private insurance, Medicare, perpetually described as a boondoggle by conservatives, is a model of efficiency. I was managememt consultant in healthcare for twenty years. Some days I couldn't bring myself to believe the lunacy of the whole system.
Paul Krugman: I agree, but I'm puzzled that you think I missed your point. The column clearly identifies administrative costs as a key problem with the U.S. system.
Carol Bouville, Gaithersburg, Md.: Why is the obvious so hard for us Americans to accept? We used to not want any government-sponsored child care either because it was too socialistic. I suspect that has a lot to do with not getting government involved in universal health coverage. After all, our leaders are my age and came of age when anything that mimicked socialism was verboten. I lived in France for 18 years. Yes, it was cumbersome sometimes to get around in the health care system, but at least it was very cheap and available — and good, too. We never had to worry about losing our coverage or about not being able to pay for necessary treatment or meds. I argue that because of that peace of mind, we had a better quality of life than most Americans. Why don't people demand access to health coverage and refuse to vote for anyone who doesn't pledge to make the single-payer system a reality? What do we have to do to make that happen?
Neeta Moonka, MD, Demarest, N.J.: Thank you for this column. I am a physician who has been convinced of the need for a single-payer plan in this country since before I went to medical school in 1981. Please know the patchwork of employer based insurance, Medicare, Medicaid, not to mention the uninsured, takes its toll on doctors as well.
Bill Hess, Wasilla, Alaska: Your comments on nationalized insurance resonate with me. I am sitting here, feeling a notable amount of pain, thinking it would be good to go see a doctor and ask about it, but I dare not — I can't afford to. Not because I don't have insurance, but largely because I do. I am 55 years old and when I first got my insurance over a decade ago, it was a good deal. In the time since, my insurers have continually forced me to pay more for less, to drop my dental care altogether, to increase my deductible while still cutting back on my medical benefits. Yet the rate I pay has more than doubled to over $600 a month — that's just for me. Fortunately, my wife and grown children receive care under the U.S. Indian Health Service.
I have a prostate problem for which I take three medications, all of which I must purchase myself along with any other medications I might find myself needing at any time. Last spring, my urologist ordered up a cat scan to double check a few things, which turned out okay. Two weeks later, I was struck by some intense abdominal pain. The physician who saw me felt it necessary to order up still another cat scan, which revealed nothing that wasn’t on the original, but did add several thousand to the medical bills I was already facing, bills denied by my insurance company.
So I have been trying to pay off this big debt and now I dare not go see a doctor again, as long as I am able to function and move around. I simply cannot afford to. An older brother recently had part of his colon removed due to cancer and another brother suffers a variety of often severe colon ailments. My father has had part of his colon removed as well. This puts me in the group of at-risk people who are advised to get a colonoscopy, but I checked into it and, even with my insurance, I would be facing a few more thousand in additional medical debt that would be uncovered by my insurance.
I know what happens when my insurance company receives one of my medical bills — they do not say, “Let's see what we can do to help this guy and keep him healthy for as long as we can.” They say, “Let's see if we can deny all of this, or as much as possible, and lets keep raising his rate dramatically every few months so that, hopefully, by the time he really needs care and we would have to put out some bucks we will already have forced him to drop our coverage.”
They may not actually vocalize it in those terms, but I sincerely believe both scenarios to be an accurate reflection of their policy.
Mark Sengel , Banglamung, Thailand: Thanks for your focus on health care. I am 50 and teach in Thailand. The hospitals here are excellent and tens if not hundreds of thousands of foreigners are coming here from all over the world to have root canals, colonoscopies, and back surgery. Meanwhile, everyone I know in America feels their choices are limited. They choose to stay in jobs they don't like, they don't start businesses, and they live in places they don't really want to in order to get health care. Most have no idea how they are going to retire, estimating they need hundreds of thousand dollars just for health care if they are going to retire in their early 60's. And these are people that are way ahead of the average American. What is the endgame?
Lynne Koester, Yuba City, Calif.: Would it be feasible to convert Medicare into a national health insurance system? I realize that its present per-patient cost is high because of the age of those who qualify for Medicare, but if the pool were enlarged by including most all Americans, wouldn't the per-patient cost decrease? By eliminating the profits built into private health insurance companies, we could save even more money. Plus, when ill, many uninsured people presently use a hospital emergency room because they do not have medical insurance, but if they were covered by a national health insurance, they could be treated in a doctor's office, which is less costly than a hospital.
Paul Krugman: Yes, indeed. One way to implement national health care would simply be to expand Medicare to everyone.
Of course, doing that would require additional funds, probably in the form of an increase in the payroll tax. And that would elicit howls from the right. But the apparent rise in tax rates would be an illusion: it would simply substitute an explicit tax for the implicit tax that companies and workers pay in the form of insurance premiums. Given international experience, I have no doubt that overall spending on health care would actually fall, and that job creation would actually rise, after the supposed tax increase.
It's a simple solution, building on a program that we already know works. It would make the vast majority of Americans better off. And it's considered a complete non-starter politically. Now why is that?
At least 18 states have introduced universal health care bills, most based on a single-payer model
By Amy Snow Landa
Oct. 24/31, 2005
From Vermont to California, proponents of single-payer health care have been busy introducing legislation, circulating ballot petitions and broadening their coalitions — all with the hope that at least one state will enact legislation that can be used as a model for national health care reform.
But opponents of single-payer health care, including state medical societies, say they are not worried that all of the activity means that government-run health care will be enacted any time soon.
“We’re not ringing the alarm bell yet,” said Tim Maglione, senior director of legislative affairs at the Ohio State Medical Assn.
Although Ohio has one of the most active single-payer movements in the country, there is little chance that a single-payer bill will pass the state’s Republican-controlled Legislature or be signed into law by Republican Gov. Bob Taft.
“We feel pretty confident the Legislature doesn’t have any interest in pursuing this,” Maglione said.
Single-payer advocates, having drawn the same conclusion, have turned their efforts to a petition drive, said Johnathon Ross, MD, a Toledo internist and a leader of the Single-Payer Action Network of Ohio.
The group is attempting to collect about 100,000 signatures on its petition, which directs the Legislature to vote on the Health Care for All Ohioans Act. So far, they have collected “tens of thousands” of signatures, Dr. Ross said.
If the Legislature then refuses to take action on the bill, supporters will collect a second round of signatures to put single-payer legislation directly on the ballot.
“Our target [for putting it on the ballot] is November 2006 at the earliest,” Dr. Ross said. But the group may put it off if they need more time to prepare for what is likely to be a formidable challenge waged by the insurance industry and other opponents, he said. Single-payer ballot initiatives have been tried in Oregon and California but were unsuccessful when they faced the opposition’s overwhelming resources.
Single-payer advocates don’t want to see that happen in Ohio. “We have to make sure we have a movement” established before taking single-payer health care to the ballot box, Dr. Ross said. “We’re using the petition to drive this movement.”
In addition to Ohio, at least 17 other states have introduced universal health care measures, most of them based on a single-payer model, according to the National Conference of State Legislatures. But so far, none of the bills has been enacted.
The American Medical Association has opposed the establishment of single-payer health care both at the state and federal levels. It has long advocated for using tax credits and other market-based reforms to make health care coverage more affordable.Vermont’s close call
The state that came closest this year was Vermont, where the Legislature passed a bill in June that would put the state on the road to establishing a single-payer system called Green Mountain Health.
The measure, called an Act Relating to Universal Access to Health Care in Vermont, would have phased in a single-payer system funded through taxes levied on individuals and employers. But Republican Gov. James Douglas vetoed the legislation.
Despite the veto, the Legislature was able to appropriate funds for the Commission on Health Care, a legislative panel that is studying a number of issues related to health care reform, such as governance and financing.
Both the commission and Douglas are holding hearings to solicit recommendations on health care reform. The Vermont Medical Society has been developing its own proposal, which it plans to submit in mid-October, Executive Director Paul Harrington said.
Rather than promote a single-payer system, the VMS proposal would keep in place existing insurance coverage paid for by employers, Medicare and Medicaid. It would offer residents in the individual market a basic benefit plan at an affordable cost through the Office of Vermont Health Access, the agency responsible for the state’s Medicaid and other health programs. The proposal also would subsidize premiums for low-income Vermonters and provide new incentives to encourage employers to offer health insurance to their employees.Eyes on the prize
Of all the states where single-payer supporters are most active, California is considered the biggest prize because of its sheer size, both in terms of population and health care spending. Nearly $200 billion is spent in California each year — about 13% of the entire nation’s spending on health care, according to the UCLA Center for Health Policy Research.
Activists there have been working for years to enact single-payer legislation, but supporters and opponents have differing views on whether the movement has crested or continues to grow.
“As far as we know, their efforts are not any more prevalent today than they were a year ago or 10 years ago,” said Larry Akey, a spokesman for America’s Health Insurance Plans.
But that’s not the view of Ida Hellander, MD, executive director of the Chicago-based Physicians for a National Health Program. The single-payer movement in California “just continues to grow,” she said. “They have a pretty broad-based movement; they’ve educated a lot of people, and very large, well-organized groups like the California Nurses Assn. are on board.”
In the California Legislature, a single-payer bill passed the Senate in May but faces an uncertain future in the General Assembly. Even if the full Legislature approves the bill, Republican Gov. Arnold Schwarzenegger is likely to veto it.
“The bill is dead for the moment,” said Michael Sexton, MD, president of the California Medical Assn., which opposes the legislation. “We don’t think there should be an ability to ration care based on a global budget,” he said.
Instead, the CMA is working to advance its own proposal, which would cover the uninsured but preserve a public-private system of health care coverage, he said. The plan includes refundable tax credits for the purchase of health care.ADDITIONAL INFORMATION:
The Vermont Legislature, for information on H 524, an Act Relating to Universal Access to Health Care (www.leg.state.vt.us
California legislative information page, for information on SB 840, the California Healthcare Insurance Reliability Act (www.leginfo.ca.gov
The Ohio General Assembly, for information on, HB 263 and SB 263, the Health Care for All Ohioans Act (www.legislature.state.oh.us
October 22, 2005
By Robert Kuttner
The United Autoworkers union has agreed to save General Motors over a billion dollars a year in health insurance costs. This is a disguised pay-cut, since workers will now pay more out of pocket for their healthcare.
The union agreed to this desperation deal to help keep GM alive. The once-dominant auto-maker posted a record $1.1 billion loss in the third quarter; and its former parts division, Delphi, with 34,000 union jobs, has just gone into bankruptcy. If and when it emerges, Delphi's $26-an-hour workers will be cut to something like $12. That gets your attention.
The union leadership was so eager to help GM survive that the UAW filed an unusual suit intended to block its own union retirees from challenging the negotiated health-benefit cuts. Now Ford has just reported a $284 million third-quarter loss, and wants the same kind of deal the UAW gave GM.
Even with these concessions, the industry that once was the core of America's blue-collar middle class is continuing its downward spiral, cutting jobs and cutting the pay and benefits of the workers that remain. General Motors, which a generation ago had about half a million union workers, will soon be down to 84,000.
But it would be a mistake to conclude that high wages or excess health benefits are bankrupting US industry. Look at our competitors. Japanese labor costs in the auto industry are comparable to American ones and German wages are far higher.
There are, however, two offsetting differences. First, the Japanese and Germans are ahead technologically and have a knack for making reliable cars that consumers want to buy. Second, their healthcare is financed socially.
So GM's biggest problem is not labor costs; it's that except for its profitable SUVs (which are becoming white elephants as gas prices rise), too few consumers are buying GM's products. When management makes dumb decisions about design, quality, or marketing, autoworkers end up paying the price.
GM spends also $5.6 billion a year on healthcare -- more than it spends on steel. Its foreign competitors spend nothing on healthcare. So GM and the UAW are common victims of America's failure to have national health insurance.
The UAW, to its credit, has advocated national health insurance since the days of its first president, Walter Reuther. General Motors, like the rest of American big business, has fiercely resisted it -- preferring to bear billions in expenses to having a national policy it considers socialistic. But it would be another mistake to conclude that autoworkers have had too good
a deal on health insurance. The reality is that most Americans have had too bad a deal.
Somehow, the rest of the industrial world can provide health coverage for everyone, and only spend an average of about 10 percent of its national income, while we spend 14 percent and leave over 44 million people without health insurance.
How is that possible? Simple: we squander hundreds of billions of dollars processing claims, having dozens of competing insurers spend a fortune on marketing, paying HMO reviewers to second-guess physicians, evaluating who is "insurable," and otherwise wasting about 30 cents on every premium dollar paying middlemen who provide no healthcare.
And we overpay dearly for treatment in emergency rooms, where tens of millions of poor people go when they get really sick, having been unable to afford cheaper and more cost-effective routine care. Other nations spend more efficiently on preventive care, because everyone can afford to see the doctor.
Here is one good idea, proposed by environmental activists Michael Shellenberger and Ted Nordhaus, and sponsored by Senator Barack Obama of Illinois as the Competitiveness and Accountability Act. Congress would offer automakers the following deal: If they invest substantially in fuel-efficient technology, Congress will relieve them of the health insurance burden of their retirees.
Isn't this a bailout? As Shellenberger and Nordhaus observe, after 9/11, Congress bailed out the airlines and asked nothing in return. This proposed subsidy would insist, in return, that auto-makers help themselves, their workers and consumers -- by building more competitive and fuel-efficient cars. A bankruptcy is also a bailout -- investors and workers bail out failing management.
If we could think more creatively, we wouldn't have to choose between saving the auto industry and having decent health coverage for its workers -- and everyone.
Robert Kuttner, co-editor of The American Prospect, can be reached at email@example.com. His column appears regularly in the Globe.
(c) Copyright 2005 The New York Times Company
Thursday, November 17, 2005 - 12:00 AM
Froma Harrop / Syndicated columnist
Listen to the elders complain about their new Medicare drug benefit. You'd think that for $724 billion over 10 years, the taxpayers could have bought them more happiness.
But no, they are angry over the program's complexity. They must choose among dozens of plans. The plans cover different drugs, and charge different premiums, deductibles and co-payments. Medicare beneficiaries are now attending three-hour drug-benefit seminars and hurling questions at their pharmacists. There are reports of people breaking down in tears of frustration.
Such was not the vision of the free-market swingers who created this extravaganza of confusion. They opposed adding a simple "one-size-fits-all" drug benefit — bland as Al Gore — onto the existing Medicare program. Instead, they would lead Medicare's 43 million beneficiaries into the promised land of choice. As the swingers painted it, private insurers would compete for the elders' affections by offering exactly the drugs they wanted at low cost.
Only 39 percent of older Americans can figure out the options, according to a survey by the Kaiser Family Foundation and the Harvard School of Public Health. The questionnaire also found that 37 percent were simply not going to sign up, and 43 percent didn't know whether they would.
That's what happens when people are overwhelmed by choice, according to Barry Schwartz, author of "The Paradox of Choice: Why More Is Less." They don't make a choice. They opt out.
"The only good thing about this plan is it's better than nothing," says Schwartz, a professor of psychology at Swarthmore College. "So if you have nothing, you can throw a dart and you're better off. People who already have drug coverage (say, from an employer or through Veterans Affairs) could throw a dart and be worse off."
The Medicare Prescription Drug Finder (at www.medicare.gov
) is supposed to help you compare plans. The finder lets you type in your medications and up come the plans that offer them.
Several problems here. One is that the listed drugs often come with asterisks. An asterisk may lead to the words "quantity limits," which means you can get only a certain number of pills a month. It may instruct you to "call the plan." People calling plans say they've been put on hold for 40 minutes, then gave up.
Let me interrupt this column with a minute of silence for the taxpayers. The discussion so far has centered on the beneficiaries' displeasure. What about the people who will be picking up most of the extravagant bills?
During the 2000 presidential campaign, the conservative media jumped all over Al Gore for proposing a drug benefit with an estimated price tag of $253 billion over 10 years. "Mr. Gore seems unconcerned about costs," opined The Wall Street Journal.
The newspaper much preferred George Bush's magic-of-the-marketplace proposal. Bush insisted his "conservative" plan — much like what we now have — would require only $158 billion over 10 years. That was less than one-quarter of what it will really cost.
No doubt Gore's plan would have exceeded his estimate. But its numbers would have been far closer to the mark than Bush's fantasy. The plan's simplicity made it harder to conceal its true costs.
And it was based on the proven assumption that Medicare is a very efficient health-insurance program. Medicare's indirect expenses are only 2 percent. The overhead for private insurance companies is 25 percent. Unlike Medicare, private insurers must advertise, enrich their top execs and deliver a profit to investors.
These very rough calculations also assume that the time of the beneficiaries, their children, their pharmacists, their doctors, Medicare officials, state health and elderly affairs workers, et al., is not worth anything. How many man-hours have gone into explaining "creditable coverage," "true out-of-pocket costs" or "Medicare Advantage" plans? How many gray hairs have been pulled out in trying to get a live human being at Medicare's toll-free number? (If you want to bother, it's 800-633-4227.)
Is no one happy with the new Medicare prescription-drug benefit? Actually, the insurance and drug companies are happy. The insurers have been generously cut into the deal. And Medicare law forbids the government to negotiate prices with drug manufacturers.
Yes sir, the insurers and drug makers are real happy. As the beer commercial says, "This Bud's for you."Providence Journal columnist Froma Harrop's column appears regularly on editorial pages of The Times. Her e-mail address is firstname.lastname@example.orgCopyright © 2005 The Seattle Times Company