On Healthcare Reform Stimulating the Economy: The Massachusetts Example

Recently, a somewhat starry-eyed op-ed in the New York Times suggested that a $100 billion annual investment in universal healthcare is just the medicine that our economy needs. The goal, declared Jonathan Gruber, a professor of economics at the Massachusetts Institute of Technology: "covering every American."

It is an appealing proposition. But let me suggest that we cannot blindly invest billions in an already bloated healthcare system. We need to think through where we want the reform dollars to go. Which sectors of a $2.3 trillion health care economy should we stimulate to insure that patients receive the safest, most effective care at a price that they can afford?

For example, should we try to create more jobs for those making diagnostic scanning equipment?

Probably not. As Health Beat recently reported, we're already experiencing what some call an "epidemic of diagnostic imaging." In too many cases, patients don't benefit. Across the board, 20 to 50 percent of high-tech diagnostic imaging fails to provide information that improves patient diagnosis and treatment. In some cases, false positives lead to unneeded biopsies and surgeries that harm patients. Recent research suggests that an explosion of MRI scans for breast cancer is leading to unnecessary mastectomies. In other words, women lose a breast for no good reason.

So while GE might like more business making diagnostic imaging equipment, all of the medical research suggests that we already have more MRI units than we need, and that they are being overused. (Keep in mind, the goal of health care is not to create jobs: it is to improve the nation's health.)

But if we simply open the door and tell insurers we'll provide subsidies for health care for all, we can be sure that a nice chunk of the $100 billion that we invest annually will buy more testing equipment and more tests. Insurers will continue to pay for unnecessary testing because it is popular among many patients (who believe, falsely, that it provides benefits without risks) and some physicians (diagnostic imaging can be very lucrative.) If insurers say "no" to a popular procedure, they risk losing market share. If they say "yes" they can pass the cost along in the form of higher premiums, and taxpayers, in turn, will have to find the money to fund higher subsidies.

The problem is this: too many proposals for health care reform focus solely on universal access and run the risk of sending good money after bad. The question we need to ask is: "access to what"?

As Merrill Goozner pointed out earlier this week while "lack of insurance leads to an estimated 22,000 unnecessary deaths each year, medical errors kill nearly 100,000--and most of those people were undoubtedly well insured."

How can this be? While uninsured patients are undertreated, in our money-driven healthcare system well-insured patients (including Medicare patients) often are over-treated. And overtreatment can be dangerous. Unnecessary hospitalizations lead to hospital-acquired infections and medication mix-ups. Unneeded tests lead to false positives (telling you that you have a disease when you don't), and treatments that can expose patients to risk without benefit. Patients endure surgery when physical therapy, a change of diet, medication and exercise might have done as much good. In the best-case scenarios, these surgeries lead to pointless stress and wear and tear on the body. In the worst- case scenarios, gruesome surgical site infections, medication mix-ups, and errors in the OR can prove fatal. That's how misdiagnosis, unnecessary treatments and hospitalizations lead to 100,000 deaths per year--almost five times the number of Americans who die because they don't have health insurance.

Let me be clear: no one in this country should die because they are uninsured. This is one reason why I, like Gruber, favor an immediate investment in expanding Medicaid and SCHIP, the programs that cover our poorest and youngest citizens. Premature death is closely tied to poverty. As we've discussed on Health Beat, low-income individuals stand the greatest risk of dying prematurely. Moreover, if the federal government provides additional funding for Medicaid and SCHIP, this will take a burden off the states, which in turn, will leave the states in a better position to fund public works programs that can create jobs.

But when it comes to pouring billions into Health Care for All -- posthaste -- we should do our best to make sure that we are not funding hazardous waste. This means making the structural reforms that will steer patients toward the most effective treatments and reward healthcare providers who reduce medical errors, avoid unneeded high-risk treatments, and deliver what patients need most.

This will involve adjusting co-pays and reimbursements in ways that will upset those in our healthcare industry who profit most from ineffective, over-priced treatments. They feel entitled to these profits. Gird for a lengthy battle with the lobbyists.

Alternatively, one could leave decisions about co-pays and reimbursements to the insurance companies. But do we really want them making coverage decisions based on what will increase their market share? Or hiking deductibles and co-pays, not to steer patients toward the best care, but to discourage them from seeking any care? In the past, that hasn't worked out very well.

Will Universal Coverage Create More Nurses?

Gruber cheerfully assumes that if we just invest $100 billion a year in universal coverage, the money will quite naturally flow where it is needed to create "high-paying, rewarding jobs in health services" that will add value to the economy. "Most reform proposals emphasize primary care" he explains, "much of which can be provided by nurse practitioners, registered nurses and physician's assistants. These jobs could provide a landing spot for workers who have lost jobs in other sectors of the economy."

Here, he ignores two realities. First, the guy who loses a job in Detroit--or on Wall Street--is not going to be in a position to become a nurse without a few years of training, if then. Nursing is a demanding profession that requires a keen intelligence, a cool head, physical stamina, and empathy. Not every former investment banker would make the grade.

Secondly, and more importantly, because the pay for U.S. nurses is relatively low--and working conditions in our chaotic health care system are poor--we have a very hard time filling the nursing positions that we have today.

As I reported not long ago, while the U.S. lays out substantially more for doctors, drugs, devices, and medical procedures than every other developed country in the world, there is one exception to our medical largesse: the "salaries of [U.S.] nurses are roughly equal to salaries in other countries." In addition, salaries for nursing school professors are often lower than the salaries we pay nurses. As a result, nursing schools have had great difficulty recruiting teachers.

Meanwhile, given the high rate of medical errors in our hectic healthcare system, nurses find the job exceptionally stressful. "I was just too afraid that I would kill someone," one former New York City nurse told me.

As Dr. Val points out over at "getbetterhealth.com," nurses are not lining up to provide primary care services in our healthcare system "for the same reasons that physicians aren't too keen on it: the pay is low, the workload is grueling, and there are other career options that offer better lifestyle and salary benefits."

So while universal coverage would create greater demand for skilled nurses able and willing to provide primary care, it would not create greater supply. One would think that, given the fact that Gruber is a board member of the Massachusetts Health Insurance Connector Authority overseeing Massachusetts effort to provide universal coverage, he would be aware of the shortage of registered nurses in that state.

As of 2006, federal government estimates show that Massachusetts had 5,000 fewer nurses than it needed. In 2010 it is projected that 10,000 positions will be empty, and five years after that Massachusetts will be looking for 16,000 nurses.

In other words, health care reform in Massachusetts has not magically conjured up the influx of nurses that Gruber envisions.

The Massachusetts Example

Instead, Massachusetts' heroic effort has unmasked the primary care shortage that the Commonwealth shares with the rest of the country. Until we reform our delivery system, we can promise everyone access, but we cannot deliver care.

"It is a fundamental truth--which we are learning the hard way in Massachusetts--that comprehensive health care reform cannot work without appropriate access to primary care physicians and providers," Dr. Bruce Auerbach, the president-elect of the Massachusetts Medical Society, told Congress in February.

Just as an investment in Healthcare for All will not suddenly produce more nurses, it will not magically summon up more medical students eager to go into the very demanding specialties at the lowest end of the physician income ladder: primary care, family medicine, palliative care, geriatric care or pediatric care.

The need to pay off medical school debt, which averages $120,000 at public schools and $160,000 at private schools, is one major reason that graduates gravitate to higher-paying specialties and hospitalist jobs.

Primary care physicians (PCPs) typically fall at the bottom of the medical income scale, with average salaries in the range of $160,000 to $175,000 (compared with $410,000 for orthopedic surgeons and $380,000 for radiologists). According to the New York Times, in rural Massachusetts, where reimbursement rates are relatively low, some physicians are earning as little as $70,000 after 20 years of practice.

But is not just low pay that discourages medical students. As Dr. Christine Cassel, president of the American Board of Internal Medicine, told me in a recent interview: "Academic medical centers undervalue primary care. They put students [who are trying to learn the art] in the most dysfunctional, least well organized part of the hospital. Residents are down in the basement--with no records, no support'' seeing the poorest patients. "This is not how to mentor primary care doctors," she adds. "The best models are in the large salaried multi-specialty groups--Kaiser Permanente, Henry Ford, Mayo, the Cleveland Clinic. They understand the value of primary care. There, you have a critical mass of doctors; you can share coverage. You don't have to be on call all of the time; you can go home at 6 o'clock."

Reformers who talk of universal coverage that promotes preventive care should ask themselves: who, exactly, is going to provide this care? Before imagining an ideal system of chronic care management, call Boston and try making an appointment with a primary care doctor. As I have reported on Health Beat, even physicians cannot get an appointment with a family care doc in that city. Mass General, for example, is no longer taking new primary care patients.

Dr. Patricia A. Sereno, Massachusetts president of the American Academy of Family Physicians, reports that patients who want to schedule an exam with her office must wait three months for an appointment.

The New York Times reports that the share of internists in Massachusetts who accept new patients has dropped to barely half of what it was not long ago. State-wide, the average wait by a new patient for an appointment with an internist rose to 52 days in 2007 from 33 days in 2006.

This is not to say that health care reform in Massachusetts has caused the dearth of primary care providers. Boston is hardly alone. Nationwide some 56 million Americans do not have a regular health care provider, even though many of them are insured. The problem: a shortage of family doctors, internists and PCPs.

Before promising coverage that we cannot deliver, we need to address this shortage. To expand the supply primary care providers we should create medical loan forgiveness programs. We also need incentives for academic medical centers to invest in better PCP training programs. In Massachusetts, legislative leaders have belatedly proposed bills to forgive medical school debt for those willing to practice primary care in underserved areas. This is a step in the right direction--but it will be years before the programs funnel new family doctors into the marketplace.

In the meantime, what will patients do? In Massachusetts "Thousands of newly insured patients have figured out that the fastest way to see a physician is to go to the Emergency Room," notes Dr. Stanley Feld over at "Repairing the Health Care System."

"Citizens in Massachusetts are going to the emergency room at a 40% higher rate than the national average at a 20% higher rate than before the present universal healthcare system."

This of course, only hikes the total cost of healthcare, pushing insurance premiums heavenward. The average charge for treating a non-emergency illness in the ER is $976, according to the state Division of Health Care Finance and Policy. By contrast it costs between $84 and $164 to treat a typical ailment such as strep throat in a primary care doctor's office, according to Blue Cross Blue Shield of Massachusetts, the state's largest private insurer.

The Rising Cost of Care Under the Massachusetts Plan

Since the Massachusetts reform became law in 2006, 439,000 people have gained coverage. The update issued by the state last month reveals that the share of state residents who are "going naked" has dropped from a high of 7.4 percent in 2004 to 5.7 percent in 2007. This is only a slight improvement on 2000, when 5.9 percent lacked insurance. Nevertheless, on the face of it, this is an impressive achievement in just three years.

But, as "the Center for Health System Change (CHSC) pointed out in a brief on Massachusetts reform just two months ago, "Little has been done to address escalating health care costs. Yet, both [coverage and costs] must be addressed, otherwise the long-term viability of Massachusetts' coverage initiative is questionable."

This helps explain why Massachusetts' version of "universal coverage" isn't quite universal. Last year Massachusetts "exempted" 62,000 of the state's citizens from the mandate that everyone buy insurance on the grounds that these families could not afford the state's climbing insurance premiums--premiums that are trying to keep up with those ER bills, not to mention a diagnostic imaging industry that continues to grow. The exemptions are based on affordability schedules established by the state.

Too poor to afford the insurance, but not poor enough to be eligible for subsidies, these families remain locked out of the system.

Because healthcare remains so pricey, Massachusetts has not been able help many a struggling middle class family. An editorial on Boston.com offers this example: "A couple in their late 50s faces a minimum premium of $8,638 annually, for a policy with no drug coverage at all and a $2,000 deductible per person before insurance even kicks in. Such skimpy yet costly coverage is, in many cases, worse than no coverage at all. Illness will still bring crippling medical bills--but the $8,638 annual premium will empty their bank accounts even before the bills start arriving.

The editorial notes that, according to the Census Bureau "only 28 percent of Massachusetts uninsured have incomes low enough to qualify for free coverage. Thirty-four percent more can get partial subsidies--but the premiums and co-payments remain a barrier for many in this near-poor group...And 244,000 of Massachusetts uninsured get zero assistance--just a stiff fine if they don't buy coverage."

Employers, too, are squeezed by the rising cost of care. The CHSC brief notes: "Massachusetts employers continue to experience large premium increases, which for some small employers are reportedly in the double digits. Respondents largely attributed rising premiums to the escalating costs of Massachusetts characteristically expensive health care system. Many expressed concern that unless the state seriously addresses the underlying factors driving costs, the current trajectory of the reform is financially unsustainable."

Many of Massachusetts' Insured Cannot Afford to Use the Insurance

With deductibles that run as high as $2,000, plus 20 percent co-pays that can bring an individual's out-of-pocket expenses to $5,000 a year, the state acknowledges that many of the newly insured cannot afford to use their insurance. According to the update that the state published last month, 37 percent of insured citizens who :needed care last year didn't go to the doctor because "cost was an obstacle."

That's up from 32 percent in 2006, the year the Massachusetts lhealthcare reform law was passed This illustrates what those who focus on "Healthcare for All Now" fail to understand: Universal Coverage does not equal Universal Access to Care. If more than one/thire t of insured families cannot afford the deductible and co-pays, what good is the insurance?

What Went Wrong?

The problem, says Dr. Feld, is that the Massachusetts healthcare plan was not thought out. This is what happens when reformers focus on covering everyone now--without thinking about how to contain costs while delivering more effective care.

We cannot blithely assume that increasing the demand for primary care will boost supply. That doesn't mean we have to wait years for more primary care docs to emerge from medical schools. Some thoughtful investments could provide solutions: more community health centers, particularly in inner cities, would alleviate overcrowding in ERs. We could pay doctors to communicate with patients who have only a minor problem by e-mail or by phone, increasing the number of patients that they can see quickly. And if we provided financial incentives for PCPs to hire nurse practitioners, pay them well, and improve their working conditions, we could bring some nurses back from retirement, expanding primary care coverage.

But if want affordable care, when we invest more in one part of the system, we have to save somewhere else. This means facing down lobbyists, and cutting the very high fees for certain services that some specialists provide--especially when these services are only marginally effective.

In his New York Times op-ed, Gruber claims that we just don't know how to rein in health care spending. "Experts have yet to figure out how to restrain cost increases without sacrificing the quality of care that Americans demand." This simply is not true.

Rather, "Experts have yet to figure out how to restrain cost increases" without sacrificing the amount of over-treatment that well-insured Americans have been persuaded that they need.

But as both the mainstream press and the blogosphere focuses on excesses in our healthcare system in the form of an "epidemic" of diagnostic imaging; angioplasties that expose patients to risks without benefits, and over-priced , not fully tested drugs and devices that have to be withdrawn from the market (after killing many patients), Americans are beginning to understand that more care is not necessarily better care. We need a healthcare system that delivers "the right care to the right patient at the right time."

Who decides what is the right care? Medical evidence should be our guide. As Peter Orszag's Congressional Budget Office (CBO) pointed out in December of 2007, we know where much of the waste is. We already have comparative effectiveness research on a wide range of treatments, pitting angioplasties against drug regimens for heart patients, for example, and gauging the effectiveness of surgery for patients with emphysema.

Moreover, CBO notes, the Cochrane Collaboration--an international nonprofit organization that has a network of volunteers who conduct unbiased systematic reviews of treatments--maintains an accessible database that now contains more than 4,500 reviews. We currently have legislation in Congress poised to create a Comparative Effectiveness Institute that could draw upon Cochrane's findings, adapting them to our priorities and issuing guidelines (not rules) for best practice.

Admittedly, we will have to make some tough decisions: How far do we go in regulating insurers to insist that they cover the most effective care? Should we require "community rating"--which means that insurers cannot charge older or sicker patients higher premiums? (So far insurers are adamantly opposed to this idea. But in Massachusetts, the fact that older patients pay significantly more is one reason why some are "exempted" from coverage, at just the time in life when they need it most. )

Should health care reform mean paying more to healthcare providers who follow guidelines? Consider, for example, the National Cancer Institute's recommendation that the risks of mammograms outweigh the benefits for average-risk women over 70. Should we reimburse the healthcare provider for the time it takes to explain to an elderly woman why she may not want a mammogram? Should we require that women over 70 who, nevertheless, insist, pay more out-of-pocket? These are questions we need to address before handing insurers a blank check to cover all Americans.

Keep in mind: insurers are not going to try to excise waste from the system if it means losing market share. Few insurers discourage mammograms because the treatments are popular. If they did, customers and employers might switch to a different insurer.

We don't have to make thousands of separate decisions about individual treatments before embarking on universal coverage. But we do need structural reforms that will begin to squeeze the waste out of the system. We should put systems in place that begin to address questions about coverage and reimbursement based on how much a treatment benefits the patient. Can we "think through" those structural reforms, and win the inevitable battles with the lobbyists who will oppose any form of cost-containment in the next 120 days?

No. But before rushing blindly forward, we should remember Massachusetts. Despite the best of intentions, the Commonwealth's reform shows that "universal coverage" does not mean "universal access" to sustainable, affordable care. In Massachusetts,

--Co-pays and deductibles are so high that the share of insured citizens who cannot afford to use their insurance has climbed since reform began.

--The number of uninsured has dropped from its high--but the share of Massachusetts citizens who lack insurance remains over 5.5 percent--roughly where it was eight years ago, in part because the state doesn't have enough money to provide subsidies for everyone who, the state agrees, simply cannot afford the premiums. These citizens are left out in the cold: "exempted" from universal coverage.

--Meanwhile both the state and its employers are going broke trying to keep up the cost of covering the rest of the population.

And Massachusetts is a wealthy state. Imagine if we had Massachusetts-style healthcare reform nationwide. Do you really think this would help the economy?

The original version of this post appeared on www.healthbeatblog.org

Comments

[quiact]

Thanks to various corporations infecting our Health Care System in the United States, the following variables sum up this system as it exists today, which is why the United States National Health Insurance Act (H.R. 676) is the best solution to meet our health care needs as citizens, it appears. We would finally have, as with most other countries, a Universal Health Care system that will allow free choice of doctors and hospitals, potentially. It should be and likely will be funded by a combination of payroll taxes and general tax revenue:
Access- citizens do not have the right or ability to make use of this system as we should.
Efficiency- this system strives on creating much waste and expense as it possibly can.
Quality- the standard of excellence we deserve as citizens with our health care is missing in action.
Sustainability- We as citizens cannot continue to keep our health care system in existence , or tolerate it as it exists today any longer,
Dan Abshear

[quiact]

Our health care we offer citizens is the present system is sort of a hybrid of a national and private health care system that has obviously mutated to a degree that is incapable of being fully functional due to perhaps copious amounts and levels of individual and legal entities.
Half of all patients do not receive proper treatment to restore their health, it has been stated. Medical errors desperately need to be reduced as well, it has been reported, which should be addressed as well.
It is estimated that the U.S. needs about 60 thousand more primary care physicians to satisfy the medical necessities of the public health in the United States. And it is apparent that we have some greedy corporations that take advantage of our health care system. Over a billion dollars was recovered for Medicare and Medicaid fraud last year through settlements paid to the department of Justice because some organizations who deliberately ripped off taxpayers. These are the taxpayers in the U.S. who have a fragmented health care system with substantial components and different levels of government- composed of several legal entities and individuals, which has resulted in medical anarchy, so it seems.

[quiact]

Nearly half of the states in the U.S. are planning on or have made cuts to Medicaid, which covers about 60 million people, and those on Medicaid are in need of this coverage is largely due to unemployment. With these Medicaid cuts, over a million people will lose their health care coverage and benefits to a damaging degree.
About 70 percent of citizens have some form of health insurance, and the premiums for their insurance have increased nearly 90 percent in the past 8 years. About 45 percent of health care is provided by our government- which is predicted to experience a severe financial crisis in the near future with some government health care programs, it has been reported. Most doctors want a single payer health care system, which would save about 400 billion dollars a year- about 20 percent less than what we are paying now. The American College of Physicians, second in size only to the American Medical Association, supports a single payer health care system. The AMA, historically opposed to a single payer health care system, has close to half of its members in favor of this system. Less than a third of all physicians are members of the AMA, according to others.

[quiact]

percent of U.S. citizens want our health care system overhauled:
The U.S. is ranked number 42 related to life expectancy and infant mortality, which is rather low.
However, the U.S. is ranked number one in the world for spending the most for health care- as well as being number one for those with chronic diseases. About 125 million people have such diseases. This is about 70 percent of the Medicare budget that is spent treating these terrible illnesses. Health Care cost presently is over 2 trillion dollars of our gross domestic product. One third of that amount is nothing more than administrative toxic waste that does not involve the restoration of the health of others. This illustrates how absurd the U.S. Health Care System is presently. Nearly 7000 dollars is spent on every citizen for health care every year, and that, too, is more than anyone else in the world.
We have around 50 million citizens without any health insurance, which may cause about 20 thousand deaths per year. This includes millions of children without health care, which is added to the planned or implemented cuts in the government SCHIP program for children, which alone covers about 7 million kids.
Our children

[sharonmsnrn]

NURSING. MSN RN full time for 30 plus years. ICU, ER, gerontology and Nursing education. NURSING. NURSING. NURSING

[lj9283]

One factor that seems to be overlooked in discussions on Health Care in the U.S. is the financial impact of the uninsured. (The details below can be found in the Kaiser Family Foundation’s publication “The Uninsured, a primer – Key facts about Americans without health insurance”)

It is projected that in 2008 the costs for medical services for the uninsured will be $87 billion dollars.

Of those costs $30 Billion will be paid out of pocket by those who are uninsured.

The remaining uncompensated costs will be covered by Federal (26.5 Billion), state and Local (17.2 Billion) and Private Dollars (14.5 Billion) :

Of the uncompensated care monies (57.4 Billion), Hospital will receive $35 Billion, Community Providers will receive $14.6 Billion, and Physician will receive $7.8 Billion.

In addition, the uninsured pay more for health care services (two to four times).

I just pulled out a health care payment form from my old health insurance provider. Charges from my doctor for service were $517.00 and 100% payment from the insurance company was $140.00 plus my $20.00 copay.

So I think an initial discussion on health care reform should start with how to better manage the $87 Billion dollars currently in the system for the uninsured.

In addition a discussion on how to develop methodology for a consistent pricing model for medical services.

[Maggie Mahar - Huffpost Blogger]

Yes, uncompensated care leads to cost-shifting.

But here is what most people don't know: Because the uninsured
don't live as long as the rest of us, the yactually cost the system Less
. They just don't live long enough to develop some
of the very expensive diseases, like Alzheimer's.

Here is the other surprsing wrinkle: this is less becaue they
are uninsured than because so many of the uninsured are poor.

Poverty is far and away the most important factor which determines
whether you die prematurely. Whether or not you have access to
healthcare is less important.

That said, of course we need to provide effective healthcare for everyone.
I think that community clinics --particuarly in inner cities--are one answer. that
could cut down on the cost-shfiting.

And we should make more of the poor and working poor eligible for
free care at these clinics. This is a much more efficient way to help them--
rather than havning them wind up in ERs.

I think the Obama administration is likely to move on community clinics.
They can establish an ongoing relationship with patients and families.

[Maggie Mahar - Huffpost Blogger]

lj9283--

And yes, the poor pay more for their care than the rest of us--
which makes no sense at all.

All patients should be charged the same amount for medical
services--and those who need help should receive subsidies
to help them pay.

I

[bobbyvassallo]

I like my own doctor. I would rather choose my fate than have someone dictate whom I should trust. Osteochondral transplants need to be done by a specialist, like so many other things. I'd rather have Dr. Bugbee than Dr. Smith or Jones. Unfortunately, I pay a fortune for insurance and it still covers less and less every year. But, being charged the same for all heathcare providers? That is like paying the same for all cars. They are as different as healthcare workers. http://osteochondraltransplant.com

[jbatch]

I'm at a loss. I can't figure out why -- when as much as 25-30% of medical costs are tied up in administrative falderall created by the need to deal with and feed the insurance companies, with NO direct relationship to actual health care -- we continue to pretend we can get real reform while insurance companies are part of the mix.

To paraphrase Ronald Reagan, something I rarely do, insurance companies are not the solution, they are the problem.

And the worst flaw of the Mass system is that it proposed the problem as part of the solution.

[likeicare]

I remember, back in the early 70s, when there was a big push for what was called, no-fault auto insurance -- and how it would be THE remedy for all those people driving around uninsured.

And, look at the rates charged for auto insurance today, nearly 40 years later -- $$$$$!!!!!!!!

No thank you, please -- no more "mandatory" insurance remedies for the nation's healthcare problem -- it doesn't work, never has, and never will.

Insurance --of any kind -- is merely gambling -- a hedge bet, if you will -- against catastrophe or misfortune -- and that's all it is. People should stop referring to it as something we CANNOT live without, like food or water -- it isn't.

The whole idea of employer-based health insurance was to create incentives for prospective employees to choose one company over another when looking for a job -- that quaint little holdover from the 20th century is dead as a doornail, and the facts prove it -- everybody -- The Big Three, et al -- are dumping their employer-paid healthcare insurance as fast as they can.

Meanwhile, the fat cats in the insurance mafia are getting how much in bonuses this Xmas? They seem pretty confident that their good buddies on K Street and in the Rethuglican Party will continue to provide them with a steady stream of income they couldn't scrape up in a truly free-market environment if their lives depended on it.

[Maggie Mahar - Huffpost Blogger]

Likeicare-

I agree with part of what you say.

We need insurance because none of us knows who is going to face a catastrophe. Your two-year-hold might be diagnosed with cancer;; your mother might be diagnosed with Alzheimer's, and live ar 18 years;.

Setting catastrophes aside,in the normal course of living, all of us will age.. Some will live to 98--, and will need expensive care during our final 10 or 15 years.

This is why we, pay premiums into a pool that will cover everyone.

But I agree that we don't want the government handing captive customers over to the insurance industry.--and let decide insurers what to charge, what to cover etc.. . . .

Insurers must be tightly regulated. The government must require that they offer insurance to everyone--younr or old, sick or well.). And that they charge everyone in a given community the same price for a policy--whatever their age or pre-existing condtitions.

At this point, insurers have agreed to guaranteed issue, but not to charing everone hte same price. ." This is not acceptable. Before mandating that everyone buy insurance (with govt subsidies for those who cannot afford it) we have to insist that insurers cannot gouge the old and the sick.

Also, a national health boad, consutling with a comparative effectiveness institute should tell insurers what treatments and drugs they have to cover (based on benefit to the patient) and how much they can charge.

[jbatch]

The pooling and sharing of risk are the key to successful and low cost health care; the question is, how do you align incentives to do this, and who can and will do it best and cheapest.

Republicans have spent billions and decades trying to convince us that government can't do anything and that the private sector is efficient.

And yet, we know that overhead in the private insurers is 25-35% or more, and only 4% for government health care programs like medicare and medicaid. We also know that health outcomes for the government programs are better.

So empirical data tells us that the Republican dogma is flat out wrong, and that government-run health care (single-payer, universal coverage) costs less and performs better.

So why do we ignore the facts and insist that private insurers be part of the solution?

[freshnotbitter]

Daschle has the right idea and he has been appointed HHS Secretary by Obama. However, I would point out that his "health board" which will act as a kind of "commissioner" of health in the publicly insured sector is visualized by him as composed of Presidential appointees.

If we have a system where people are allowed to choose a private plan or be enrolled compulsorily by means of paying a percentage of their AGI on their 1040 if they cannot show they have private insurance, then we have to think about who will "govern" that publicly insured sector that ensures 100% universal coverage.

I don't think "Presidential appointees" are the answer. I believe we should have 50% of the board of commissioners elected by doctors the remaining 50% less one commissioner appointed by the President with the last commissioner serving as chairman elected by the people every 4 years with congressmen when the President is not being elected. I believe the Chairman should report to congress and that congress should have the power to decide the absolute size of the budget but not how the budget is allocated. If any experts in game theory have a better idea then please let us know.

A "chairman elected by the people" might face constitutional roadblocks.

Many of the problems listed in Maggie Mahar's post remind me that we lack in this country a fourth branch of government: The Ombudsman.

The chair of the federal board of health could act as an ombudsman.

[Maggie Mahar - Huffpost Blogger]

Freshnotbitter

Thanks for your comment.

I absolutely agree. A HealthCare
Board should not be appointed by the
President. (Even if you think you might
like the board Obama appointed, think
what could happen 12 years from now
if Jeb Bush somehow became president.)

I like the idea of physician involvement, but there
are self-interested groups within that community who
have their lobbiesnd their financial interests.

That's why I would be inclined to have the board
appointed by someone apolitical, like the Comptroller
General.


The Comptroller General appoints the Medicare Payment
Advisory Commission (MedPac) and they are excellent. Generally
regarded as very intelligent. Have put out excellent reports.

The only problem is that, for hte last 8 years, no one has
been willing to act on thier reports. Now, if we had a healthcare
board that would . . . I think the board members, btw, should
be made up of physicians, nurses, medical ethicists and
medical reserachers and healthcare economists who
have absolutely No Financial
Interest in any drugmakers, device-makers or other health
care lobbying group and who are not advocates for
any particular disease.

[AngelaQuattrano]

Keep in mind that the purpose of the current health care delivery system in this country is not getting services to people who need them. It is designed to prevent people who don't deserve subsidies from getting health care at a reasonable price, and therefore there is no cost to great to the system in achieving this goal. It doesn't matter how many people die from lack of health care, so long as not a single person who does not deserve it gets it.

[drricklippin]

I agree with your critique of the well meaning Gruber piece in NY TIMES. The TIMES is increasingly out of touch with the best health care bloggers like you.

Maggie Mahar says Rather, “Experts have yet to figure out how to restrain cost increases” without sacrificing the amount of over-treatment that well-insured Americans have been persuaded that they need".

That is correct

Hate to be so blunt but we insured have been both duped and swindled at best - harmed at worst.

I think? more people are finally realizing that.

Deep appreciations for your role in driving these points home.

Dr. Rick Lippin
Southapton, Pa

[Maggie Mahar - Huffpost Blogger]

Dr. Rick--

I agree that Gruber's op-ed was well-meaning.

The only part that really bohered me was that one sentence
where he suggested that we don't know how to control
costs and still give Americans the high quality care they
demand--as if care in this country is safe and effectve.

Unfortunately, as you known,
in many areas of medicine, outcomes are worse in
the U.S. than in other developed countires.

[WorkingClass]

Health care should not be sold for profit. Until we nationalize health care it will continue to be the abomination that it is.

[schatsie]

Wow, what an incredible article....... I am also strongly in favor of putting children first... where is the sense in taking care of the elderly but not the children...

ALSO I am in favor of some kind of Medicare Expansion to cover the Military families. we need one repository for all the expenses paid for them so that we can track issues like Agent Orange (we need to say thank you to the Free Market for that) and Gulf Syndrome and the Uranium issue... and cap those copays and coinsurance fees...

If the Health Insurance companies want to stay in business, the only way should be to clone either the Japanese or German models which strictly regulate the companies...However in this capitalist model state, we don't regulate effectively (see Enron, Wall Street, the Savings and Loan fiasco and read Free Lunch), so maybe that idea needs to be tabled... Yes, Barack, in fact, there is something that governments are good for besides the military, infrastructure and law enforcement, and that is Medicare and Medicaid...

[Maggie Mahar - Huffpost Blogger]

schatsie-

Thanks for your comment

The Veterans Administration has what is, structurally, a very good system.
But it is underfunded--and has been for most of the last eight years.

I'm hopeful that a new administration will give it the funding it need.

And you are right, both Japan and Germany do a very good job of regulating
private insurers.

But I am concerned that, in the U.S., lobbyists will beat back regulation.
Congress will have to take them on.
There are signs that Congress may do just that-- see this post that I wrote
about what Congress did in July http://www.healthbeatblog.org/2008/06/the-score-physi.html.

[Thermodynamics]

Its just like the auto biz -- they are selling us Cadillac Escalades when we need Toyota Corollas.

Health care is not sacred. It is a business just like war. Nursing homes are run by accountants, not nuns.

I have a lot of relatives who are civil service types with plenty of insurance. If they get a band-aid it is a $50,000 therapeutic wrap. The providers see them coming and dish out the complex and expensive stuff repeatedly. It is not better care. I think a lot is unnecessary and possibly harmful. I have stories, like 25 ultrasounds for a normal pregnancy, etc.

[Maggie Mahar - Huffpost Blogger]

Thermodynamics--

"They are selling us Cadillac Escalades when we need Toyota Corollas."
Exacty--and well put!

[Vickster]

I saw this coming two years ago. So-called "universal" coverage will never provide universal health care, therefore, it seems to me that the solution is to take the insurance companies out of the mix. Nor am I alone in this assessment. When I was a teen-ager, my father (a biostatistician) and my mother (a medical secretary) worked for the Department of Preventive Medicine at Vanderbilt. The doctors they worked with all agreed that replacing health insurance with "socialized" medicine was the only way to reform the health care system in America. And that was thirty-five years ago.

[schatsie]

Very great of your parents, AND I HOPE they are not in a Medicare HMO... At this time, we cannot afford not to go 'socialized' there is way too much fat in the system and I can tell you that Medicare is good at digging into the data AND implementing the changes... Medicare does not cover pregnancy though, that is covered by the For PROFIT insurers and the more health dollars they spend, the more the BOARDS of DIRECTORS will pay the management. i would love to see the Medicaid information on sonagrams, I would bet it is fairly restricted...

[Maggie Mahar - Huffpost Blogger]

Vickster--


There is a lot to be said for single-payer.

Though in this country, one does have to worry that
lobbyists representing Phrama, device-makers, for-profit
hospitals and the highest paid specialists woudl wind up
running the system . .. .

The biggest obstacle, however, is that so many people have employer-based insurance,
and don't want to give up what they have for an unknown new
govt-run system . . .

[timm0]

Yes, but you can conjure a list of 'people won't want to give up "x"' when you talk about ANYTHING that is in one condition today and there is a suggestion to change it tomorrow.

Simple example - people didn't want to "give up" SUVs until about a year ago - even knowing the wasteful and uneconomical design. Then when they finally get a snootful of reality in the form of $3 per gallon gas, they can't get rid of them fast enough.

In other words, we can't skip over the only real solution that addresses the external stresses on the health care system because there are people too f00lish to realize that they are f00lish.

Given the fact that many people have learned some lessons the hard way recently, the mood of some stalwart naysayers may be different today. So I think you over-exaggerate the 'danger' of people not "wanting to give up" their health care system. For those who kick and scream, too bad. When my kids were 2 and screamed in the store, I dragged them along with me. This is how we have to deal with immature folks who can't grab hold of reality.

Build the right system that will be most cost-effective. In the end, we need the grownups to come through with a new structure that will transition us away from almighty "capitalism" (i.e. corporations vs. consumers) which has proved to be an utter failure for Americans.

[PDSimic]

Maggie, you don't really need to have people give up on employer-based insurance.

For start, the government should introduce a non-profit universal single payer competitor into the health insurance market, funded by a small percentage of the taxpayers money, say, flat tax of 0.5-1% goes to fund the universal non-profit health care system.

People who have employer-based insurance don't have to join. If they decide to join they will bring in an additional percent of their salary as contribution to the single payer system, and their employers will be obliged to match this according to some formula (cost neutral or better). This would insure that the universal system remains fully funded as more people join in, while the employers will not be more burdened then they are now. This will also have a positive effect of inserting some real competition into the health insurance market that is missing now. Most the these companies will have to shrink to much smaller niche market size if they are to keep their fat returns, which given their effective hold on the whole health care market in the moment run as high as 1/3 of every health care dollar spent.

This would be more then enough to cover all Americans who join while not representing a significant burden to those who opt to keep their employer based insurance. The universal coverage standards could be set as high as in the rest of the civilized world.