Given the social, economic, and political complexities of U.S. health care, legislation targeted payment as its primary vehicle for reform. Improvements in finance and expansion of Medicaid will transition to wider coverage for the 15 percent of the population sans insurance. A market derived structure, incentivized by the dollar, without regard for the well being of patients is responsible for problematic health care delivery.
The organization and financing of medical care in the United States is an abomination, rooted in the for-profit business model established by the 1973 Health Maintenance Organization Act. The historic non-profit approach was replaced by cost-cutting market methods of limiting hospital care, denying coverage for numerous "preexisting" conditions, and micromanaging provider decision making and treatment plans. Patients are constantly reminded of third party limitations of care, added to frustration in deciphering networks that accept a particular insurance in an already difficult-to-navigating and confusing system. The doctor-patient relationship has ultimately suffered under the private sector driven managed care philosophy.
The U.S. health payment system is a mixed economy. The population break down demonstrates about 60 percent having private insurance (usually employer paid), 25 percent with government insurance (paid by a combination of state and federal government), and 15 percent uncovered (relying on "charity" and uncompensated care). Market-based health payment generated oligopolies such as Anthem and United Healthcare. These companies have evolved large bureaucratic administrative systems, which decrease company and personal accountability to patients and physicians while increasing the cost of care.
Despite the argument that market forces are a better steward of the dollar than government, health insurance is a case where businessmen intervene with profit-seeking intentions, disregarding patient well-being. Greed and cutback strategies by private insurance companies have made executives rich and rotted the core of physician-patient interaction. Most estimates show administrative costs/overhead accounting for about 10-12 percent of private insurance expenditure compared to 2 percent for government Medicare/Medicaid. Administrative costs coupled with high payouts to executives (the United Health care CEO salary was $102 million in the last fiscal year) may explain why insurance premium increases have superseded wage increases by 400 percent over the last decade. Physicians must be very savvy in dealing with these large insurance syndicates to ensure appropriate diagnostic and treatment options. Operating in a largely unregulated market, the invisible hand has misguided the U.S. health care delivery system and mistreated patients, often compromising care. The federal government has appropriately identified this situation with the application of regulatory legislation.
Government insurance programs are inherently well regulated, to the benefit of patients. The process of clearing diagnostic tests and applying treatments and surgeries is more efficient and pro-patient compared to private insurance companies. Administrative costs are minimal because no third party intervenes for profit-seeking. However, operational costs are unacceptably high. Per capita government health care spending is among the highest in the world, which can be attributed to the expensive way medicine is practiced in the United States (see previous entries accounting for high cost, including medical-legal organization and physician overuse of diagnostic tests, unhealthy population not being treated societally, and physician-patient dependence on an expensive social welfare state).
While roughly 25 percent of the population has government insurance, it accounts for over 50 percent of U.S. health care spending. These numbers indicate a disparity that can be accounted for when considering populations and the manner in which medical care is accessed. Indigent segments of the population rely on Medicaid, which is provided without price transparency and keeps these patients unaware of the cost of medical services. Additionally, lack of education and misunderstandings about garnering access to the complex health care system are common themes among this patient base. As a result, innumerable unintentional abuses of the health care system occur, such as frequent trips to the transitory emergency department setting for issues that do not require emergency attention. Instead, minor health or psychosocial issues should be handled at a clinic in an organized, scheduled environment, where continuity of care and patient education is provided.
Uninsured populations rely largely on charity care, funded through state or community programs as well as Medicaid, for free or reduced rate health care. This segment does not have insurance for a variety of reasons, including disqualification from government programs, employers not providing insurance, inability to afford costly private plans, decision not to have insurance, or a combination of all these factors. While roughly 15 percent of the population lacks insurance, most of their costs are covered, with purely uncompensated care representing 3 percent of all U.S. health care expenditure according to a 2009 Kaiser study. The other 12 percent is partially paid below standard insurance rates; insurance companies typically reimburse 20-35 percent of billed costs depending on the agency.
The issue with uninsured care is inconsistent access delaying diagnosis and allowing pathologies to progress, which ultimately leads to compromised systemic health and increased deferred cost. Societal costs are amplified through lost population potential and treatment of advanced pathology. For example, an otherwise healthy 25-year-old female without access or incentive for health care has essential hypertension left untreated for 20 years. Accelerated progression of vascular disease may result in carotid artery disease and stroke with one side of her body paralyzed, or possibly renal artery stenosis and kidney failure with dependence on dialysis. Her cost in quality of life along with long term treatment is avoidable. A common clinical scenario we see in our practice is a 50-year-old uninsured male presenting with an advanced cancer of the floor of mouth invading jaw bone, requiring tumor and jaw resection, neck dissection, forearm reconstruction, and post-operative radiation therapy, with long term follow to monitor for recurrence. Early diagnosis of a less advanced tumor with regular health care would enable less aggressive treatment, less patient morbidity and decreased long-term costs.
The Obama administration has rightfully addressed health care payment flaws and designed legislation based on private sector failure and the societal need to offer care to the uninsured. Medicaid will expand, federal subsidies will increase, employers will be incentivized to provide insurance, and the issue of preexisting conditions will be rectified. Much debate surrounds the legislation's impact on patient care, methodology of restructuring the payment system, and the creation of national fiscal challenges with socio-economic implications. Nonetheless, there is strong consensus from physicians to patients that health care delivery structure necessitated revision.