Re-Posted October, 2005. (This is a supplement to a talk given on June 9, 2005, to the Senior University Georgetown, a lifelong learning program.)

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We need to re-think health care financing. There are many solutions being posed. I confess that I have become somewhat inclined to the idea of a single payer, universal coverage, national health plan. References and websites that speak to this problem are at the end of this webpage.

There are several problems:
   1. Continuing escalation of health care costs.
   2. Continuing escalation of health insurance premiums--even Medicare premiums, along with co-pays for people who are already paying hefty premiums.
    3. Evidence of decline in certain aspects of quality of health care.
          a. Access:  Even with insurance and/or participation in an HMO, there are often significant time delays before one can actually see a physician, and more to see a specialist, if that is indicated.
          b. Satisfaction with medical care, the relationship with doctors and nurses, etc.
     4. Increasing difficulties getting payments, with denials, demands for paperwork, and so forth feeling like a harassment of the patient.
      5. Demoralization of doctors who have to spend increasing amounts of time advocating for authorization of referrals, procedures, hospital admissions or continued stays, etc.
      6. Numerous degradations of the status and respect, the autonomy and judgment of doctors and other professionals by business administrators.

Ideological Blocks to Clear Thinking

Our culture at present has drifted into an attitude that government is bad, regulation and taxes are bad, business, free markets and competition are good, and this applies as well to the field of medicine as it does to any business or trade. I confess to seeing the situation as a tipping of the balance too much towards laissez-faire capitalism, when what is needed is more balance between the enterpreneurial spirit and the needs of the community.

Part of this block involves a deep philosophical question as to whether health care should be viewed as a right rather than a privilege--an attitude that has come to characterize most of the developed countries in the world, except for the United States. (A few other countries that are at the edge of  development, such as Turkey, also don't have this policy.) Some might view it as a basic moral or even religious value, while others rationalize the natural gradient of better medical care for those who can pay for it as an intrinsic necessity for economic wealth-development.

Having acknowledged these issues, and not wanting to get mired in this very considerable aspect of the problem, I will bypass a deep treatment of the problem of the lack of universal coverage--though perhaps it will be addressed separately some day--and focus instead on the simple question of cost-effectiveness.

Are we getting value for money?

At present people in the United States, individually and collectively, spend about a trillion dollars a year on health care, which is about 14% of the gross national product. This means about $4,000 for every man, woman, and child. In comparison, people with comparable life styles in other developed countries spend more like 8-10% of their country's gross national product, more like $2,300 per year.  Moreover, in those countries, everyone is covered, completely, while in the United States, over 44 million people are uninsured, and many more are to varying degrees under-insured.

Furthermore, according to a number of research criteria, from expected life span to infant mortality, the United States is far behind compared with many other countries!  The argument that we offer the best care in the world is misleading, being true only for certain conditions, type of elegant surgery, etc. The problem of access should not be under-estimated.
Access
Item:  Over 10% of pregnant women delay getting prenatal care. Of these, almost half put it off because they have no insurance and can't pay for it. Another third can't get an appointment! Needless to say, various complications and types of morbidity are more common among this population.
Under-Insurance
The problem of under-insurance is a complex one, because it includes several categories. Many people are insured with exceptions, like prenatal care, dental care, eye and hearing care, even obstetric care. Others with pre-existing conditions, in spite of high premiums, remained uninsured for further episodes or complications of those conditions.

Another type of under-insurance is the provision of unrealistic time limits, maximum hospital days per year or per lifetime, and for some people with more serious conditions, this leaves them essentially bankrupt in the long run. There is also the payment per day limit, and as hospital costs have risen from less than $20 per day in the 1940s to hundreds of dollars daily more recently, those limits become ever-more inadequate. As for the percentage of payment--covering 50% or 80%, again, for significantly expensive problems, that remaining percentage still can become an overwhelming stress on families.

Item: Bankruptcies have doubled in the last decade. As of a few years ago, almost half were caused mainly or in significant part by medical debt. The suffering of families in such circumstances should not be underestimated. There has probably been months of dunning by collection agencies that are not reluctant to use humiliating and misleadingly threatening manipulations.


Miscellaneous Supplementary Notes:

1989: USA spends 12 % national income on health care.
          Canada and France spends about 8.6% (the next highest amount)–and also cover everyone

40 million uninsured, many are refused coverage at any cost.
     (Yet when they go to hospital, they are billed at much higher levels than those with insurance, because the latter's companies have negotiated costs)

22nd in ranking of countries re rate of babies dying before 1st birthday! Lower than Singapore, Spain and Ireland!

Life span in 1987 shorter than people in Japan, France, Sweden, Canada & Germany.

Only developed country without universal health care. South Africa also, though it does offer it to whites (in late 1980s).   Now Turkey (on the edge of development) also lacks it.


Continuity of Care:
      Folks in one business' plan get shifted to another medical group or managed-care program, with different doctors, when every year or two there is renewed bidding among competing programs and the "buyer"–the company– is convinced that company B can do as good a job as company A for less. So they go with the cheaper.
       Yet this requires new evaluation visits for all the patients who are otherwise stabilized on a medical regiment, if they are to get refills. Disrupts the doctor-patient relationship.

Time spent making appeals, getting information, and so forth.
     Insurance companies have an incentive to delay payments, deny or minimize them, and having people give up on having to wait is one strategy. Having too few inquiry phone lines is another, with lower level people responding, and the need to speak to higher level managers then requiring more delay.

Include also time spent:

   By patients in trying to get appointments, especially if follow-up, or urgent care is needed.

   By patients in trying to resolve problems with billing
          Often a variety of "unfair" billing practices, and sometimes bewildering and actually fraudulent or careless mis-billings

    By doctors' offices seeking to get clarifications of denials, demands for paperwork, authorizations for procedures or visits, and do forth.

    By doctors' and hospital clerks in trying to keep up with shifting requirements

    By patients and doctors in coping with the way a business might change provider organizations covered, as competing types of health insurance "bid" for business.

Objections: It will cost more in taxes.

    Before responding, we must consider the following: The health premiums payed by companies are tax-deductible. This means that wealthy corporations save more money, money that would otherwise enrich the government in taxes and offset part of the raise in taxes. Tax cuts are subsidies by the taxpayer.
    Other tax breaks similarly must be thought of as total expenditures in the health care budget.

   So, yes, there will be more taxes, but they will also be distributed more fairly, with the wealthier paying more than the poor. At present, the middle classes and poor pay more, percentage-wise, than the rich.

   
Those costs will also be offset by savings in having a single payor, eliminating many different and multi-layered middlepersons.

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American Medical News  Feb. 21, 2000: "HMOs hiking rates, but not physician reimbursement"

10.4% - The increase in businesses' health care expenditures from 1999 to 2000.
3.1% - The increase in reimbursements to doctors, hospitals and other providers in that time.
83.6% - managed care companies spend on patient care (third quarter, 1999)
    Comment:  A net increase of 7.3% of all health care expenditures is being directed to a middleman industry that is currently consuming 16.4% of health care dollars.  This amounts to a 44% increase in funds diverted to an industry that exists solely for the purpose of controlling health care inflation!

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(More to be added)  -  

References on Health Care Financing in America

Abramson, John. (2004). Overdo$ed America: the broken promise of American medicine. New York: HarperCollins.
   (A physician critiques the Industrial-Political Health Care complex.)

Anders, George. (1996). Health against wealth: HMOs and the breakdown of medical trust. New York: Houghton Mifflin.

Armstrong, Pat, & Armstrong, Hugh. (1998). Universal healthcare: what the United States can learn from the Canadian experience. New York: The New Press / W.W. Norton.

Bartlett, Donald L. & Steele, James B. (2004). Critical condition: How health care in America became big business and bad medicine.  New York: Doubleday.

Coombs, Jan G. (2005). The rise and fall of HMOs: an American health care revolution. Madison, WI: Univeristy of Wisconsin Press.

Cutler, David M. (2004). Your money or your life: Stong medicine for America's health care system. Cambridge, UK: Oxford University Press.

Geyman, John P. (2002). Health care in America: can our ailing system be healed?  Butterworth/Heinemann.   (Other books:     Also:. Falling Through the Safety Net. )

Devo, Richard A. & Patrick, Donald L. (2005). Hope or hype: the obsession with medical advances and the high cost of false promises. New York: Amacom / American Management Association.  (Doesn't address health care financing, but does note the tendency to overestimate new developments.)

Konner, Melvin (1993). Medicine at the crossroads: the crisis in health care. New York: Pantheon.

LeBow, Robert. (2002). Health care meltdown: confronting the myths and fixing our failing system. Boise, ID: JRI Press.

Merrill, Jeffrey C. (1994). The road to health care reform: designing a system that works. New York: Plenum.

Mueller, Rudolph. (2001). As sick as it gets: a diagnosis and treatment plan. Dunkirk, NY: Olin Frederick, Inc.

Quadagno, Jill. (2005). One nation uninsured: Why the U.S. has no national health insurance. New York: Oxford University Press.   Reviews the history.

Roled, Neil. (1992). Your money or your health: America's cruel, bureaucratic, and horrendously expensive health care system: how it got that what and what to do about it. New York: Paragon House.

Websites:

http://www.pnhp.org     Physicians for a National  Health Program
       This is a particularly rich website.

http://www.covertheuninsured.org

http://www.eino.org      Everybody In, Nobody Out

http://www.cnhpNOW.org            Campaign for a National Health Program

http://www.cmwf.org/    Commonwealth Fund

  The Center for Studying Health System Change, www.hschange.org
Families USA, http://www.familiesusa.org/         and

 Kaiser    www.kff.org    


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