City Journal Magazine | David Gratzer | Summer, 2007
Socialized medicine has meant rationed care and lack of innovation. Small wonder Canadians are looking to the market.
Mountain-bike enthusiast Suzanne Aucoin had to fight more than her Stage IV colon cancer. Her doctor suggested Erbitux—a proven cancer drug that targets cancer cells exclusively, unlike conventional chemotherapies that more crudely kill all fast-growing cells in the body—and Aucoin went to a clinic to begin treatment. But if Erbitux offered hope, Aucoin’s insurance didn’t: she received one inscrutable form letter after another, rejecting her claim for reimbursement. Yet another example of the callous hand of managed care, depriving someone of needed medical help, right? Guess again. Erbitux is standard treatment, covered by insurance companies—in the United States. Aucoin lives in Ontario, Canada.
When Aucoin appealed to an official ombudsman, the Ontario government claimed that her treatment was unproven and that she had gone to an unaccredited clinic. But the FDA in the U.S. had approved Erbitux, and her clinic was a cancer center affiliated with a prominent Catholic hospital in Buffalo. This January, the ombudsman ruled in Aucoin’s favor, awarding her the cost of treatment. She represents a dramatic new trend in Canadian health-care advocacy: finding the treatment you need in another country, and then fighting Canadian bureaucrats (and often suing) to get them to pick up the tab.
But if Canadians are looking to the United States for the care they need, Americans, ironically, are increasingly looking north for a viable health-care model. There’s no question that American health care, a mixture of private insurance and public programs, is a mess. Over the last five years, health-insurance premiums have more than doubled, leaving firms like General Motors on the brink of bankruptcy. Expensive health care has also hit workers in the pocketbook: it’s one of the reasons that median family income fell between 2000 and 2005 (despite a rise in overall labor costs). Health spending has surged past 16 percent of GDP. The number of uninsured Americans has risen, and even the insured seem dissatisfied. So it’s not surprising that some Americans think that solving the nation’s health-care woes may require adopting a Canadian-style single-payer system, in which the government finances and provides the care. Canadians, the seductive single-payer tune goes, not only spend less on health care; their health outcomes are better, too—life expectancy is longer, infant mortality lower.
Thus, Paul Krugman in the New York Times: “Does this mean that the American way is wrong, and that we should switch to a Canadian-style single-payer system? Well, yes.” Politicians like Hillary Clinton are on board; Michael Moore’s new documentary Sicko celebrates the virtues of Canada’s socialized health care; the National Coalition on Health Care, which includes big businesses like AT&T, recently endorsed a scheme to centralize major health decisions to a government committee; and big unions are questioning the tenets of employer-sponsored health insurance. Some are tempted. Not me.
. . . more
If you read this article closely, you will see that it is not a defense of either the current American or Canadian health care systems. The author’s main objective is to warn Americans away from the idea that Canada offers the ideal health care model that the United States should move towards. In particular, he points to the financial pressure on the Canadian system to ration services which he argues inevitably leads to denial of needed care for some people. That said, he also admits that the US system is expensive and inefficient.
Unfortunately he offers Americans no advice for dealing with the problems of the US system beyond – don’t be like Canada. Don’t be like Canada, is in fact, his entire presentation.
My problem with the article are as follows.
1) When it comes to making policy, anecdotes and horror stories are no substiture for evidence and data. If there are problems with waiting time for needed care in Canada then there should be academically rigorous, empirical, peer reviewed studies whose findings support this contention.
2) Waiting times for surgical operations are not the only metrics to look at evaluating a health care system. What about life expectancy, infant mortality, access to primary care, hospitalizations for preventable conditions, and prevalency of chronic disease such as Diabetes and Asthma? Canada actually performs the US on many of these.
3) The author fails to mention that there are other nations with universal health care coverage that the United States can look to as models beside Canada. France and Germany, for example, have hybrid public/private health care systems, where people are free to get care from any provider they chose. However, the author deliberately fails to mention them, applying blinders on his readers if you will to fool them into thinking that universal care means the Canadian care he is attacking.
4) The author incorrectly and dishonestly describes an expansion of Medicare as a move towards a Canadian type system. Well enacting any type of publically-funded health care program, including state programs to cover people with pre-existing conditions who can’t get private insurance, is a move toward a Canadian style system in the narrow-sense that it is publically funded. Beyond that the Medicare program is nothing like the Canadian system. Medicare beneficiaries can go to any doctor they like, when ever those doctors will see them.
If we are going to reform our US health care system to make it more equitable, efficient, and fiscally sustainable, then we get beyond the feeble attempts of articles, such as this one, to stall us into inaction, and start looking for solutions with the sense of heightened urgency the situation requires.
#1 I am sure you could dig up some data. Perhaps look up this Mr. Gratzer and ask him for the data.
#2 He mentioned some data that showed that U.S. life expectancies were longer when murder or accidental death is filtered out.
#3 Germany was specifically mentioned in having a socialized system that is becoming increasingly private.
#4 Dean S., my brother, let us look at this closely. WE can both agree that the Canadian model is socialized medicine, yes? Then, by expanding MediCare or other state-run programs, we are increasingly socializing medicine. The more socialized, the more “Canadian” the system. A simple comparison, yes?
Have a good night.
Oh why Canada, it is not the only existing medical system outside the US.
If you factor in US infant mortality and post delievery problems and structural fitness at birth and the growth height and leave out murder-US mental problem-and accidents; the US falls behind most ‘developed’ countries in the delievery of medical services.
A government exist to govern; the US constitution enumerates the parameters and to care for the commonweal of its people.
Yes, European governments are retooling and revamping their medical delievery systems. This is just a normal function of adjusting to new and changing conditions. In the 10 years of the present system the US administration-congress-has done little or nothing in this area; if it had, than these problems would not be being discussed so much in the media.
His references to Sweden and Germany wasn’t even a chapter, let alone the whole book. I live in Germany at present and worked for Pharmacia Sweden. We have a private insurance carrier( all do except for the indigent) that are government regulated and there are no preexisting conditions allowed. We choose the doctors that we want to see. Every quarter you must see your family GP and pay Euro 10 for the visit. She writes chits for all specialist that we need to see; we don’t pay them. All necessary prevention shots are regulary given. Physicotheraphy RXs are given at 1/2 reduced cost. Western European medication and treatment are very up to date. There are a few pharmaceutical manufactures in Europe.
Sincerely,
J R Dittbrenner
Dean writes: “Then, by expanding MediCare or other state-run programs, we are increasingly socializing medicine.”
I’ve always thought of socialized medicine as involving the delivery of medical services, rather than the just payment for medical services. In my view, truly socialized medicine would consist of a system in which all physicians and other providers were government employees, and clinics and hospitals were government facilities.
Medicare, Medicaid, and other public programs involve payments to mostly non-governmental providers, in addition to payments to public hospitals. I worked for a teaching hospital, part of a public medical university, for over 20 years. But even that hospital was run like a business, and the physicians’ professional fees were billed through a private organization, just like any other private medical practice.
In other words, Medicare and Medicaid act very much like private insurance companies, except that the source of their revenue is public, not private. In my state Medicare even contracted with a private insurance company to audit payments to hospitals.
So I have a hard time seeing Medicare and Medicaid as “socialized medicine,” because they function very much like private insurance companies, and most of their payments are to non-governmental providers. Am I missing something?
I would like to ask my conservative friends what a health care system designed to mirror Christian moral principles would look like.
-Would it look like the one we have in the United States now?
– Would it siphon off billions of dollars every year for profit, marketing, exorbitant CEO salaries, and wasteful bureaucracy and administrative overhead.
-Would it be a two-tiered system, with high quality care for those who can afford to pay for it, and crowded emergency rooms and underfunded free clinics for everyone else?
-Would if refuse insurance coverage to people because of pre-existing conditions? (Who would Jesus disenroll?)
– Would it routinely deny claims, hoping beneficiaries get discouraged and pay the bills themselves?
-Would it force thousands of families every year to declare bankruptcy because of massive medical bills they are unable to pay?
– Would it encourage physicians to avoid primary care where the focus is wellness and prevention, and encourage them to be highly paid specialists instead?
If you admit that the United States does not have a health care system that fails to reflect Christian values, why don’t you think we should do anything about it? Is it more important to avoid anything that resembles socialism than follow the teachings of Jesus Chirst?
Dean, I’d be more inclined to attempt an answer to your questions if they were not of the “When did you stop beating your wife?” variety. You once again want to force the discussion into an ideological dialectic that is in itself, non-Christian.
#5 Mr. Scourtes:
“I would like to ask my conservative friends what a health care system designed to mirror Christian moral principles would look like.”
I doubt any health care system can be so ideal. But, I already floated my thoughts in another string (“The Anti-Michael Moore”). Instead of considering them seriously, you lost your temper (or perhaps calculated that you had no persuasive arguments) and made unfounded accusations that I am racist. Perhaps you might give fair consideration to my response in this thread.
D.George:
You had three suggestions: 1) Collect taxes from undocumented aliens to pay for their health care, 2) Make European nations pay the same drug prices as American consumers so the US does not subsidize all of the R&D, and 3) Enact Tort reform.
None of these would attack medical inflation in a comprehensive and meaningful manner, but would mereley nibble around the edges of the problem.
Your first suggestion has some merit, however to be practical it would have to be folded into a more comprehensive immigration law that would establish a guest worker program and document each person coming into this country to work. This is because the government can’t collect taxes from workers, or from their employers, if it doesn’t know who they are, duh! Conservatives (see Missourian) have rejected the Guest Worker proposal as a liberal plot to displace American workers. So blame your side for the failure of this idea to ever come to fruition.
Your second proposal sounds nice in theory but again is wildly impractical. Drug makers make deals with customers based on volume and because European nations negotiate on behalf of all their citizens they can get a better price. What you are suggesting is that government take away the freedom of pharmeceutical companies, who are private corporations, to freely enter into contracts and give their customers competitive pricing. Is that even legal? Consider that in the last ten years drug makers have spend more on marketing than on R&D. If the cost of R&D is driving drug prices higher and we spend more on marketing, shouldn’t we cut back on the Viagra commercials and the other ads that tell us that there is a pill for every problem we have and some we never even thought of?
Your third idea is not one that is related to a major driver of medical inflation and so will have little effect on costs. It is an urban legend that malpractice insurance is driving up medical costs. In fact, the cost of liability insurance is a tiny drop in the bucket compared to the costs of providing medical care to the uninsured that are passed on to you and me in the form of higher hospital bills, insurance premiums and taxes.
Mr. Scourtes:
You somewhat misrepresent my first suggestion, but thanks for recognizing that it has merit. I did not propose taxing migrant workers to pay for their health care. I proposed setting up a temporary work program, strictly controlled by our government, and making the countries of origin pay a fee for medical/educational/social costs associated with the migrants. What is in it for the countries of origin? U.S. dollars would continue to flow into their economies. The method of fee collection would be entirely up to those nations to figure out. It could be a tax on the worker, or it could be a tax on wealthy individuals in those countries, or it could come from revenues on their natural resources. We wouldn’t impose a tax of any kind on the workers, other than the regular taxes they would owe from their wages (these would likely be small). They would not have to pay social security or medicare, as their medical costs would be paid for by their host governments.
“So blame your side for the failure of this idea to ever come to fruition.”
There are conservatives who oppose a guest worker program. I would support a program, but one of a much smaller scale than the current unrestrained, lawless migration, and only after our borders were secured. A lot of the conservatives oppose such a program only because it is tied (for no necessary reason) to amnesty for 12 million people who violated our borders. There are also leftists who oppose a guest worker program, because some of them believe in unrestrained and unregulated migration. So, I will not blame one “side” or the other. I blame certain parties on both “sides,” especially those who tie securing our borders and creating a regulated temporary work program to amnesty for illegal immigrants.
Regarding the second suggestion, I am no libertarian and, while I believe markets are usually best left alone, it is not beyond me to recommend imposition of laws on trade to protect the national interest. Foreign governments that establish monopolies for purchasing and distributing medication are not normal consumers, and the associated negotiations with pharmaceutical companies are not normal negotiations. I maintain my position that Americans should not be forced into implementing price controls (and dealing with resultant scarcity) to avoid subsidizing socialized medical programs abroad.
Now, even if a need for tort reform is an urban legend, I don’t think my first two suggestions, combined with investments in electronic medical records, requirements for pricing of services, etc., that you proposed, would only “nibble around the edges of the problem.” I think this combination of approaches would make the problem manageable.
So, I ask: Why do we need socialized medicine when we can reduce medical costs by attacking a number of root causes directly? How will socialized medicine reduce medical costs without resulting in scarcity?
To: D. George:
The market is the market, what is sold is bought and sales are everywhere.
Your second idea might work if all the pharmaceutical companies were in the US and all production was grounded in the US. But, guess what, they arn’t; production and R&D are world wide.
After 30 years in the industry I found that R&R and methods of production are traded back and forth. Drugs are also traded back and forth across boarders.
I have-through the FDA-crossed licensed South Korean drugs and test for the sale in the US market. What the US customers paid was set by the American company I worked for, not by the Koreans.
Strange: Asprin cost more in Germany-the country of its R&D and first production-than in the US.
There are no flat playing fields anymore, if ever. If a country wants to make sure that their people have access to good medical delievery systems than they work at doing just that; that is part of governing for the commonweal.
Sincerely,
J R Dittbrenner
Mr. Dittbrenner:
Perhaps you are correct and my idea would be unworkable. There are a couple of alternatives. Perhaps a more workable alternative would be for the U.S. to impose price controls, such that the cost of any given medicine in the U.S. would not exceed the average cost of that medication in Western European nations? I see no reason why Americans should have to choose between government sponsered health care on the one hand and paying much more for most medications (Aspirin aside) than the rest of the world on the other. You could consider this an alternative method of governing for the commonweal. Such price controls are constitutional; they have been used before in other sectors of the American economy (albeit, usually with negative consequences). Also, price controls could be set for any medication regardless of where it is produced. If one wanted access to American markets, one would give us something approximate to European prices, without a socialized medical system.
The result would be that when a new medication would come to market, companies (regardless of their location) would refuse to produce the medicine for prices as low as Europeans are used to today. The companies would refuse, because they could not gain additional profit by charging American consumers twice as much. Instead, Europeans would pay somewhat more than they are used to, and Americans would pay a lot less than they are used to.
The problem, as I see it, is that Americans are just not rich enough anymore to support the rest of the world’s economy. I understand that there are no level playing-fields, but this playing field is ridiculously slanted.
Mr. D. George: #11
While the problems in the US medical delievery systems and the prices of medications have been exacerbating for along time-through political non-attention-the pharmeceutical companies have been busy buying up one another. Roche of Switzerland-New Jersey-Mexico-England and elsewhere, is now the largest maker of cancer fighting products. They started in the early 60s but with very long term planning, investment and effort. You can’t cut them out of the US market. If you would look at the various company registrations no one government can control raw material and finished product movements.
The pricing is adjustable, what the market will bear. That is what capitalism is about, the market will make the necessary adjustments as to price and supply.
The large generic drug companies are owned by the global giants; good luck.
Price controls can work for very limited product lines and for a very limited time: check out Iran’s and Zimbabwe’s current problems. In WW2 the US had controls and rationing; but then, for us, it was a all or nothing thing.
We do have a problem but I don’t think that congress has thought the problem through, I know that the executive hasn’t a clue. If nothing is done than it will continue to exacerbate into a still bigger problem.
Congress makes the laws and funds the regulation of these laws. I guess that you would start there and excite the media to the problems at the local levels.
Sincerely, J R Dittbrenner
D. George: Your proposals, while worthwhile, don’t attack the core problems in the US health care system but address peripheral issues. Here are the core issues:
First, you need to address the problem of 46 million Americans without health insurance whose unreimbursed care provided in emergency rooms and free clinics is then passed on to the rest of us in the form of higher hospital bills, insurance premiums and taxes. So what is your solution here? Employer mandates? Purchasing consortiums for individuals and small business? Expanded Medicare and Medicaid? Remember, the vicious cycle. Doing nothing is not an option.
Second, what about denial of coverage for preexisting conditions? What would you do with those people? Lets suppose a very talented person wanted to start his or her own business but had Diabetes, a pre-existing condition? Should they not start the business because of an inability to get health insurance and if so, what does that do to new business creation in the United States?
Third, is it a wise and rational use of scarce health care resources to divert billions of dollars from medical care to pay for billing and insurance-related activities? Hospitals and physician groups must employ huge staffs just to submit the claims and paperwork and navigate the intricate insurance company maze of rules and procedures to get them paid. One study read in Health Affairs magazine said 22% of all Hospital spending is for billing and insurance. Insurance companies themselves divert billions for administative overhead, including “denial management, (i.e. rejecting claims and/or shifting costs to third-party payers), marketing, lobbying efforts, exorbitant CEO salaries and profit.
What is more important to you: protecting the profits of insurance companies or protecting the health of all Americans?
Lastly the focus of our health care system has taking care of people when they become sick,as opposed to keeping them healthy. Are we ready to legally mandate periodic and standardized preventative health care for all Americans? Are we ready to finally crack down on the immoral Tobacco industry which addicts and poisons millions of Americans every year, and the giant food processors who put fattening corn syrup into every food product sold, leading to obesity and diabetes.
Note 13. Where are you getting the 46 million figure? Here’s a different view:
#13 Mr. Scourtes:
I think my proposals are worthwhile precisely because they would largely solve the problem about which you complain. As pointed out by Fr. in #14, the number of uninsured is likely smaller than you indicate. Half the problem is caused by an illegal workforce that cannot be insured at present.
So what is your solution here? Employer mandates? Purchasing consortiums for individuals and small business? Expanded Medicare and Medicaid? Remember, the vicious cycle. Doing nothing is not an option.
I have never proposed doing nothing. I proposed doing three things, along with doing a few things you suggested. Doing those things, I believe, would lower the cost of medical care to such an extent that people could afford coverage, and employers would be willing to offer better medical benefits.
“Third, is it a wise and rational use of scarce health care resources to divert billions of dollars from medical care to pay for billing and insurance-related activities?”
I think electronic medical records, pricing, etc., would answer this concern. But, if I have to choose divert billions to private insurance companies or divert (probably more) billions to government bureaucrats, I will choose the private insurance companies. Because they face competition, there is at least incentive to become more efficient. I agree that the medical industry is slow to increase efficiency, but this is in part because of public outcry whenever electronic medical records, etc., are proposed.
Regarding pre-existing conditions, I think it there is no doubt a solution that would not involve socialized medicine.
“Are we ready to legally mandate periodic and standardized preventative health care for all Americans? Are we ready to finally crack down on the immoral Tobacco industry which addicts and poisons millions of Americans every year…”
This is an interesting question. I am not ready to regulate every small detail of our population’s habits. On the other hand, the widespread use of high fructose corn syrup and trans-fats is pernicious. Of course, the high fructose corn syrup is used because we protect our sugar industry with tarrifs. Nobody would miss these products if they were eliminated, and people would quickly notice health benefits. Furthermore, the taste of real sugar is certainly better than high-fructose corn syrup. So, I would support banning these two ingredients so long as the sugar tarrifs were lowered.
Tobacco and alcohol are different because, if banned, a black market would form. We’ve tried that before, and it didn’t work. They are also different because trans-fats and high-fructose corn syrup (especially the latter) are hidden in so many products with such ubiquity that there is little choice in the matter for consumers. Alcohol and tobacco can be easily avoided by one who wants to avoid them.
I would support mandatory exercise (with exceptions for rare health conditions) in our schools (through college). Once people are adults, I don’t think there is much you can do.
So, I ask: Why do we need socialized medicine when we can reduce medical costs by attacking a number of root causes directly? How will socialized medicine reduce medical costs without resulting in scarcity?
According to the Census Bureau’s Current Population Survey (CPS) there were 46.6 million people in the US without health insurance for the full year in 2005.
A Primer on the CPS Estimate of America’s Ininsured, National Institute for Healthcare Management
That said, there are other estimates of the number of uninsured Americans, that employ different assumptions and have arrived at lower numbers. Additionally, there are some concerns that the CPS overestimates those uninsured for the full year and underestimates the number of individuals with Medicaid coverage.
Nonetheless, all of the estimates show employer-based coverage falling and the number of uninsured Americans continuing to trend higher. The Census Bureau has reported that, between 2000 and 2005, employer-sponsored health insurance coverage in the United States continued to erode, with the percentage of Americans with job-based insurance slipping from 63.6 percent to 59.5 percent.
Economic research has consistently shown that the principal reason that employer-sponsored insurance is eroding is rising health care costs. Higher health care costs and health insurance premiums lead employers either to pass costs to employees by raising premiums, deductibles and/or copayments or to stop offering health insurance altogether. In addition, increases in the amounts that employees must pay for coverage lead some employees to drop coverage because they have difficulty affording it.
D. George: You write:
Let’s test that theory against actual expeience. The option of joing a private health plan was offered to Medicare beneficiaries in the early 1980’s under the very theory you stated, that they could provide better quality services more efficently and less expensivly. How did it work out?
Medicare Advantage a boondoggle, Seattle PI, August 1, 2007
Note 16. Dean writes:
Don’t you think this number should be examined more closely before asserting that 46 million are uninsured? Also, were you aware the number included illegal aliens?
#16 and #17 Mr. Scourtes:
With regard to #16, nobody is disputing that the number of uninsured is large. I do, however, think that “snapshot” numbers exaggerate the problem, for the reasons mentioned by others previously. But there is a problem for sure. I’m not disputing, either, that corporate insurance benefits are declining, and that the cost of coverage is increasing. We’re in agreement about that, we just disagree about how to solve the problem.
I’m not sure how pertinent the Medicare Advantage example is. Socializing our entire health care system would result in providers and corporations having nowhere to look for additional profits. There would be one customer: The government. The government (i.e., the people) would still have to cover all of the costs.
My point is that nothing will reduce inflation if the root causes are not remedied. Socializing the system will leave inflationary pressures intact. Attempts to set prices will necessarily result in shortages.
I made several suggestions, which combined with some suggestions you yourself made, would result in a great reduction in the cost of medical care without creating shortages. Insurance would become affordable for almost everyone, and corporations would be more willing to cover the cost of insurance as a benefit. In light of this fact, I ask again:
Why do we need socialized medicine when we can reduce medical costs by attacking a number of root causes directly? How will socialized medicine reduce medical costs without resulting in scarcity?
In light of this fact, I ask again:
You will be asking again, and again, and again…in on year it will be again, and again, and again…:)
The Physicians for a National Health Program answer your question
I think the last paragraph contains some critical observations. One of the concepts you learn in business classes is that of “economies of scale”. A National Health Care program has the potential to produce savings through the elimination of redundancy and increased health care purchaser bargaining power.
Another feature of private health insurance that makes it inherently unstable is known as Adverse Selection. A health plan that designs it’s benefit package to be too attractive runs the risk of attracting beneficiaries who are sicker and more expensive than the average cost upon which their premium is based. In 1998 my colleagues and I worked on a disease management initiative for people with Diabetes that helped the health plan we were working for win accredidation form the National Commision for Quality Assurance. The response from upper management however was a very worried, “Yeah, but if we get really good at taking care of Diabetics, won’t more people with Diabetes want to join our plan?”
Already one Medicare Part D plan, Sierra Health Services has gone bust because it’s attractive benefit package drew beneficiaries who were sicker, and more expensive than average.
http://thehill.com/leading-the-news/feds-probe-humana-over-rx-drug-patients-2007-03-07.html
So there is an economic incentive for plans to reduce services.
Adverse selection can also undermine and weaken traditional plans when beneficiaries of those plans are offered cheaper Consumer-Driven health Plans (CDHP) with lower premiums, but higher copays and deductibles. Healthier, less expensive beneficiaries are the most likely to leave traditional plans and join a CDHP plan because they anticipate that their health care needs are not too great to begin with and a Health Savings Account can cover most of their out-of-pocket expense. Beneficiaries with greater health needs may opt to stay in the traditional plan but as healthier beneficiaries opt out, the average cost of the remaining risk pool increases driving premiums higher and making the traditional plan increasingly unaffordable.
Economists who have studied the distribution of health care costs within populations have discovered with reliable consistency, both over time and across demographic cohorts, that medical spending tends to be highly concentrated among a small percentage of individuals, rather than spread evenly throughout the population. This skewed distribution of costs is important because it means that as the risk pool is increasingly comprised of high cost beneficiaries, the average cost of care for the remaining population will rise dramatically.
So we can see that because of adverse selection the introduction of CDHP plans seriously weakens and imperils traditional plans.
Dean says:
One of the concepts you learn in business classes is that of “economies of scale”. A National Health Care program has the potential to produce savings through the elimination of redundancy and increased health care purchaser bargaining power.
Apparently, you dropped the course before learning about “monopoly”, “government regulation”, and of course “government bureaucracy”. I am sure they will let you enroll again…:)
Christopher,
You crack me up, LOL!
Yes, his ability to avoid ever offering a substantive rebuttal, but to always respond with a snide, glib, superficial comment is truly remarkable.
#22 and #23 Mr. Scourtes:
I don’t believe for a minute that paperwork inefficiencies would be solved by government control of our medical system. It is easy to say what might happen if a system were set up ideally, given various assumptions. It is another thing to make it happen. Paperwork in various government bureaucracies is terribly inefficient, and a lot of times needlessly so. We all know that. Why would things be different in this case?
More to the point, let’s take post #22 to its logical end. If government is so much better than private enterprise at managing health care on the basis of economy of scale alone, shouldn’t we let it manage every other aspect of our economy? After all, we could have government-run agriculture, government-run home construction, government-run furniture companies, government-run airlines, etc., etc., and the economies of scale would be enormous. But we all know that any economies of scale would be outweighed by the terrible inefficiencies and reduced incentive that go hand-in-hand with any communist economic system. There would also be lack of choice and competition (i.e., monopoly). This has been tried before in various societies and it has failed every time.
As for the adverse selection problem, this is just another bunny trail. This is a minor component of lack of medical coverage in this country. If we implemented the suggestions that I mentioned earlier (along with some like electronic medical records that you suggested) the cost of medical care would be reduced enough that companies would have more incentive to cover those with diabetes. The number who truly could not be insured, I think, would drop to such small levels that they could receive insurance as a welfare benefit.
Once again, you still do nothing to refute my contention that we could solve medical expense problems through means other than socializing the system. You seem to be trying to prove that socialized medicine could solve the problem in theory, and you seem to want to socialize the system so badly that it is self-evident to you that we should. I say socializing the American medical system involves terrible risks and inefficiencies and the proposals I outlined involve much less risk, so my questions remain:
Why do we need socialized medicine when we can reduce medical costs by attacking a number of root causes directly? How will socialized medicine reduce medical costs without resulting in scarcity?
The cost drivers you cited are not the root causes of medical inflation.
While there are undocumented immigrants among the uninsured, they utilize fewer services than the insured. Getting them to contribute to their health care can only happen as part of a more comprehensive government solution, like immigration reform and cannot be done by the private sector.
Drug prices are not high because we are subsidizing R&D for the rest of the world, but because drug companies spend more on marketing than they do on R&D. To maximize profits Drug companies must raise also prices for new drugs while they hold exclusive patent, and before the drug goes generic.
The cost of liability insurance is not a major driver of medical inflation. Studies reveal that increases in the cost of liability insurance are the not the result of a flurry of frivolous lawsuits, but the result of efforts by insurance companies to recoup investment losses
There is a scarcity of health care now for people who are uninsured, or under-insured with threadbare policies that leave them with huge out-of-pocket costs.
You fail to provide a causal link or association between a single-payer health care system and scarcity. In fact any increase in taxes to pay for universal coverage would be offset by the elimination of spending on insurance premiums and taxes currently used to pay for public health care programs for the uninsured. National health care could allow us to “relieve” scarcity by enabling us to use the money we spend currently on health care in a more efficient manner.
Adding people from the current ranks of the uninsured to expand the risk pool will help lower costs for everyone else. Since the most expensive members of the population, seniors, are already covered by Medicare, new entrants into the risk pool would be younger working people and children. This means that there will be an addition of more healthy people in the risk pool whose additional premiums or taxes, in aggregate, would exceed their costs, helping to offset the expense of the costlier people already insured.
A National Health Care program has the potential to produce savings by creating economies of scale and specifically the elimination of redundancy and increased health care purchaser bargaining power. Funds to remedy any possible areas of scarcity could come from those savings.
Single-payer refers only to insurance coverage, and not services, which would still be privately delivered. Therefore if an area of scarcity developed private physicians and other medical providers would still be free to move in and fill the niche.
A single payer system has greater ability to implement prevention and wellness initiatives, such as pay-for-performance and disease management, in a more comprehensive manner than individual small insurers.
Dean, you say,
Your statement reveals an ignorance of insurance pricing. Insurance companies have two ways of making money: Collected premiums and investment income. That is it. Their expenses: required reserves, administration, new business acquisition, claims, taxes, etc must be covered by those two sources of revenue with some left over—profit. I’ve never met an insurance executive who likes to raise premiums. In fact, they are often looking for ways that premiums can be reduced. They look first at legitimate and reasonable ways to control expenses. When revenue is sufficient to allow for reduction, premiums are reduced. That happens frequently when claims are low and/or investment income exceeds expectations. When there are catastrophic claims or significant reversals in the investment environment, premiums have to go up. It is a cycle.
In liability claims, often the largest expense is not the actual payout, if any, of the claim, but the defense costs. I was talking with one exec the other day who told me about a recent claim that cost the company $600,000 to defend. The amount paid out was zero, because it was not a legitimate claim. That was a property claim in Kansas. In malpractice claims, the defense costs are proportionately higher.
When the cost of insurance to physicians is a major portion their overhead, it is sophistry to suggest that the increase in premiums due to lawsuits and the cost to defend them particularly in states like California, does not contribute significantly to medical inflation.
More proof that the Republican strategy of trying to deny that there is a health care crisis will backfire.
From that Commie rag, Consumer Reports:
Are you really covered? Why 4 in 10 Americans can’t depend on their health insurance
Don’t fool yourself Dean, Consumer Reports has over the years taken on a decidedly liberal political stance in much of its “testing” and has become more and more a commentary magizine. I stopped reading it or relying on it a long time ago because of that. To me it just goes to show the more liberals cry facts, the less they use them.
The situation that Lou describes in his comment under Publix is unfortunately common particularly with cancer treatment. Every health insurance policy has limitations on experimental treatment with percise definitions as to what constitutes experimental treatement. All I can say is that each of us needs to read and understand the exclusions and limitations on our health insurance especially the covered expenses and limitation regarding cancer treatment.
Under government health insurance, that definition is likely to tighten.
Case in point: When the government prescription drug program was passed one adjustment that was made was to drastically reduce the Medicare reimbursement for oncology drugs and limit the list of reimbursable drugs.
IMO cancer treatment will suffer under a governement controlled plan because of the escalating cost of the new treatments. Patient care and treatment effectiveness will always take a back seat to cost, bureaucracy and the politically hot disease of the month.
The driving concern should not be who runs the system, but providing good care at a resonable price for optimum patient outcome. Believe it or not (Dean won’t) there are many private insurers who attempt to do that. A lot do not really, but it sure will not happen under governement control.
More recent information on the Canadian disaster
Source
http://abducens.townhall.com/
See Missourian, you are a perfect case in point. Just like the conservative movement in general, you have no positive or constructive solutions to offer for improving America’s health care system, just horror stories intended to mislead, obsfuscate and frighten.
Here are the unavoidable facts: Although health care spending in the US is twice as much, per person, than in Europe, the US system leaves millions of people uninsured and underinsured, while producing health outcomes no better than those in Europe. If the cost of medical care in the US continues rising at its present pace it will exceeed 20% of GDP within a decade and bankrupt our nation.
It may be that there are private-sector solutions for correct the problems in the US health care system exist. However the conservative movement hasn’t offered any. Tax credits, health savings accounts and discounted generic drugs at Walmart are not serious solutions because they do not address the core problems in our health care system in a comprehensive and meaningful manner. They are attempts at rearranging the deck-chairs on the Titanic.
The two Republicans who have attempted to offer serious comprehensive health care proposals that promote universal coverage, Mitt Romney and Arnold Schwarzenegger, have been attacked by the right. Even as Governor Schwarzenegger has been trying to win support for his proposal, Blue Cross has amassed a two million dollar warchest with which to oppose him.
We really have only three choices. (1) We can do nothing and watch our health care system sink like the Titanic, (2) We can introduce a single payer system and abolish private insurance, or 3) we can transform private insurance into something resembling a publically regulated utility.
What would private insurance look like as a publically regulated utility? First, all employers would be legally required to provide insurance, so that the working poor no longer have to go without insurance. Medicare and Medicaid would be expanded to cover the rest. The self-iinsured and employees of small business could be pooled into larger buying consortiums that States would organize.
Second, private insurance would be required to cover all applicants, including those with preexisting conditions. To protect insurance companies for underwriting risk they would have to be paid premiums that risk-adjust the populations they are covering, that is reflect the underlying health status of the individuals covered. Hopefully there should be a lot more healthy than unhealthy new people coming from the ranks of the uninsured.
Third, insurance companies would have to adapt the latest technlogies to monitor the health status of their members and make sure the treatments they receive are timely and appropriate. Standardized electronic claims procesing would have to be implemented to reduce innefficient paperwork and bureaucracy.
Lastly, with government assistance, insurance companies will have to challenge the assumption of medical specialists that they are entitled to salaries of $800,000 a year or higher. They will need to work with hospitals to halt the “arms race” that currently exists where every hospital feels it has to purchase the latest expensive medical technology in order to win business.
These are the types of constructive ideas that people who are serious about fixing our health care system should be talking about. Nobody is saying that we have to adopt the Canadian system, or the British system, or the French or German system – only that we should investigate how their health care systems are able to function more efficiently and effectively than our own and consider what features we may be able to borrow and introduce here.
Note 32, Dying while waiting in line is not a “health care system”
The factual point of the article was that neither the Canadian, British, French or German system “functions more efficiently than our own.” You are fact impervious.
I have every right to critique your proposal. You have the burden of proof and you have failed to establish that your alternative is better. The article did more than simply critique a bad system, it demonstrated why any system built on its premises will fail miserably.
Remember, Dean, people in Canada have had to sue to disentagle themselves from the “health system” which is just a system of endless lines leading to death without care.
There is virtually no price competitoin in our medical system because the health care professionas fight it. There is no reason why most health care procedures can be subject to price competition. It occurs in law, accounting and engineering, it can occur in most of medicine.
What I don’t understand is the source of your overwhelming desire to have government control everything, it is truly totalitarian. Now I understand where totalitarianism comes from.
The US recently ranked behind 41 other countries in terms of longevity, with 40 countries (including Cuba, Taiwan and most of Europe) coming ahead of us in infant mortality rates. This is embarrassing.
Perhaps the appropriate way of avoiding medical system overuse is to increase the cost of office and prescription co-pays.
Life expectancy not a proxy for quality of health care
Source:
http://www.powerlineblog.com/archives/2007/08/018191.php
Please also remember that HALF of all murder victims are Black and that 95% of their murderers are Black. We have destroyed the Black family and allowed a culture of violence thrive, but, that is O.K. because it funds social work career for friends of Dean
Missourian – As someone with a legal background what is more compelling to you, evidence or hearsay?
You are providing ancdote and hearsay to make you case against the Canadian system, but evidence and empirical data indicates that the US system performs no better than the Canadian system. From Business Week
The Doctor Will See You—In Three Months
Missourian: As someone with a legal background, which do you find more compelling, evidence or hearsay?
I ask this because you have offered only anecdote and hearsay to attack the Canadian and Europeans systems, while evidence and empirical data (such as the kind Jim referenced) shows that they American health care often lags behind them. Since you mentioned waiting times lets see what the data says.
Waiting Times For Care? Try Looking At The U.S. – Nurses, Doctors Say It’s Time To Debunk The Myths
Note 38, Hearsay is a form of evidence and it is frequently admissible
NOte 38, Dean, there is a big difference between one month and four months.
Dean, I don’t understand why you are not troubled by the idea that
hundreds of Canadians died without even the chance of medical treatment.
As to waiting a month to have a dermatologist examine a mole to determine whether it is cancerous—- that is ridiculous. Every dermatologist I know would make a special arrangement to get such patients in the same day they called. The examination takes only minutes.
It simply untrue to state that Canadians never have to worry about getting the care they need. To accept this you have to ignore the well-documented statistics that in Canada the only guarantee is a place in line.
You are truly fact resistant. There is nothing in your article that refuted the facts presented in mine. Nothing.
Your devotion to single payer health care is something like an obsession. I don’t understand the attraction to it. How could you possibly think that the U.S. government could handle that well?
Dean your first solution “First, all employers would be legally required to provide insurance, so that the working poor no longer have to go without insurance” is no solution. It will just prevent many small businesses from hiring people. And a lot will get laid off when it first goes into effect.
Michael, Dean will never grasp this point, minimum wages suppress employment
My husband and I hire summer interns at our company. They are college students and most are covered by their parents insurance, but, I will admit I don’t know that for sure. We don’t pay much, but, the students are paid to learn. One summer at our business and their employability after graduation skyrockets because we teach a highly valued set of skills. Therefore it makes sense for the students to be our interns and it is a great opportunity for them.
We don’t pay them much because they are not that productive. Example, we pay them for an eight hour day but they only produce about 3 to 4 hours of work that we can bill a client for. We eat the difference. We can do that because we don’t pay them much.
If we had to get health insurance for these people the internship program would be over. O-V-E-R. Over.
Dean, will never acknowledge this simple fact. Everybody else that I explain this to understands it. Dean never will. Dean will never acknowledge the EFFECTS of the plans he proposes, they always lead to less employment and lower GNP. They lead to poverty. The policies that Dean proposes, if adopted across the board, would turn the U.S. into the Soviet Union. POOR. Everybody would be POOR except for the party officials.
There is no moral reason that I have to adopt an employee become a parent and take charge of his welfare. He or she is an adult.
Note 42, Minimum wage suppresses employment
Same reasoning applies to any low-skilled employee. A minimum wage chokes off employment for low-skilled workers.
By the way, Dean’s favored class “illegals” also drive wages down.
In order to benefit from Dean’s compassion, you have to be in the right group. Illegal immigration is a transfer of wealth from poor Americans to poor Mexicans. Dean likes poor Mexicans better than poor Americans so he exercises his compassion in their favor.
Dean, is like Petruccio in the Taming of the Shrew. He loves the low-skilled workers so much that he will not let them have any job at all unless it pays what high-skilled workers get. Since the workers are low-skilled they will never get what high-skilled workers get, so they never get a job. They do go on welfare and this provides job for another group that Dean’s exercises compassion for, government workers.
Socialism is theft
Sorry, felt a slogan bubbling up inside me there.
Michael: It would dramatically increase the start-up capital one would need to begin a new businesss. However, do you think there are things the state could do make it easier?
1) Give small busnesses who don’t insure the option of paying an additional tax and then making their employees eligible for Medicaid or the state-employees insurance plan.
2) Organize state-sponsored organized buying consortiums that pool self-employed and small business-employees into larger groups to give them the same bargaining power as larger companies.
3) Provide tax credits for small businesses that offer employee health insurance.
When we think of small businesses, we tend to think of low tech operations, like hamburger stands, where the employees may be teenagers who might not need insurance. But the reality is that small businesses can also be high tech operations and require more professional or skilled employees who will insist on insurance. Then there is the possibility that the new business owner or a prized employee might have a preexisting condition.
So we have to consider that difficulty or inability to obtaining insurance for skilled employees can have a negative impact on new buisness creation as well.
Note 45, Dean, why should the state do anything?
Why should the state provide health insurance? Why shouldn’t the individual provide his own.
There is no such thing as a free lunch, Dean. If the government gives “tax credits” it is transferring wealth from one person to another. Why should the government transfer wealth for this reason?
We don’t make sure that everyone brushes their teeth do we?
People now believe that they have no duty to care for themselves and that government owes them health care. Thanks. This was not an advance.
Dean,
Larger companies get “barganing power” because they self insure up to a catastrophic stop loss or entirely self insure if they are big enough. Companies have to have 150 to 300 employees to begin to take advantage of the self-insurance approach.
State law in Kansas forbids the creation of associations simply for the purpose of acquiring insurance. The reason is that risk profile of such associations is bad, bad, bad. Even where an association does other things and offers some sort of group plan, the premiums are costly, go up at a far greater rate than group or individual plans and have to frequently change carriers. The reason is that experience is bad, bad, bad.
The more an employer contributes to the cost of a plan, the higher the usage rate and experience becomes bad, bad, bad.
IMO, none of what you are proposing would better the current situation.
My boss is an entrepreneur. He gets involved in starting businesses and running them. He likes to employ folks as long as the cost of employment isn’t to high for him. As a skilled sales person, if the cost of employing people got too high, he would fire everybody and go back to being a one person shop with some part time help and probably make more money than he does right now. That’s about 10 people unemployed in a town of about 700. That’s a massive layoff. I know this because he had directly told me that if health insurance becomes an employer mandate, he will shut the business down. He doesn’t need it, in fact his standard of living may well increase.
That’s the facts of life. No amount of government aide will take care of that.
Missourian: Please step out of your dimly-lit, fog-filled world of theory and ideology and into the bright, clear sunshine of reality.
The state needs to step in because:
1) The cost of individually purchased health insurance can be prohibitively expensive for many working families. Even tax credits aren’t going to help them because they don’t pay enough taxes to begin with.
Ask Michael but I think the cost of an individual policy is now over $800 a month, and over $1,200 a month for families. So let me see – you don’t believe people should have to be paid a minimum wage, but you do believe they should have to pay an amount almost equal to a mortgage payment for health insurance. Check your math, because I don’t think that’ going to work.
2) People with pre-existing conditions may not be able to purchase health insurance at all. What do they do, if they make too much money to qualify for Medicaid?
3) The self-employed and small business employees pay more for insurance than employees of large companies because they don’t have the same bargaining power to negotiate lower rates with insurance companies. This can make the cost of health insurance prohibitively expensive for them and discourage small employers from offering it at all.
4) Adding currently uninsured people to the insurance risk pools will help further spread out costs among more beneficiaries lowering risk to insurers, and allowing premiums to fall.
5) Universal health coverage will elimnate the huge unreimbursed cost of care for the uninsured in emergency rooms and free clinics that is passed on to the rest of us in the form of higher hospital bills, higher insurance premiums and higher taxes.
#27 Mr. Scourtes:
Sorry, I’ve been away from the PC for awhile. Thanks for answering my questions.
First you said that my point about illegal immigration affecting the medical system had merit, but in #27 you seem to reverse your position and claim that it has no significant impact. I would maintain that the impact is huge for reasons already mentioned. I would also maintain that Americans who pay for pharmaceuticals are getting soaked so Europeans can keep their socialized systems. If the market controlled medicine prices (as opposed to governments, which have the threat of punitive legislation on their side) in Europe, the costs would balance.
It may be that there are private-sector solutions for correct the problems in the US health care system exist. However the conservative movement hasn’t offered any. (From #33)
There are, and I have.
There is a scarcity of health care now for people who are uninsured, or under-insured with threadbare policies that leave them with huge out-of-pocket costs.
Who’s arguing this point? I have suggested causes and solutions, but they are ones you don’t like. You seem to prefer large government programs.
National health care could allow us to “relieve” scarcity by enabling us to use the money we spend currently on health care in a more efficient manner.
Sorry. I just don’t believe this at all. It is one thing to point at all the money spent on paperwork and advertisement by private corporations. It is another thing to believe that a government run system would actually do any better. And, no, Medicare is not efficient. It uses price controls. Medical providers make up for losses from inadequate Medicare reimbursements by charging others more for services. If we socialize the whole system, that game is up, and you end up with lack of incentivce and resultant scarcity.
A National Health Care program has the potential to produce savings by creating economies of scale…
So would a national agriculture program, a national steel program, a national grocer program, etc., etc. But, we all know from experience overseas that without competition, incentive would be killed and the system would become terribly inefficent despite overwhelming economies of scale. Economies of scale alone do not ensure success.
Still, if you believe that economy of scale is the answer to every problem, shouldn’t you advocate communism in order to maintain logical consistency? Imagine the crazy low prices we would have for everything!
Note 48, Dean, I run a business that employs ten people, you are the one that lives in the world of theory.
This is rich, coming from you.
First, you have not established the fundamental premise. Why is it the employer’s duty to provide health insurance? Why isn’t it the individual’s duty?
Second, major/medical health insurance from BC/BS for a single man in his 20’s costs about $40.00/month with a $1,000 deductible. Even my interns could afford that.
Quoting health insurance costs is dicey because of the impact of coverage decisions. Are you referring to major/medical? What is the deductible.
Third the average car payment in America is around $400. Most households have two vehicles, that is $800.000, many have three. Americans CAN afford two or three vehicles, a RV, a motorboat, vacations, lunches out but they CAN’T afford health insurance. My younger employees weren’t even that interested in health insurance because it just doesn’t mean that much to them. This, perhaps, is not wise, but, there it is
Dean, you are creating a problem by deciding that “all must have health insurance” Second, you are deciding that you should have the political power to force me to pay for other people’s health insurance? This is totalitarianism which is always ushered in in the name of compassion.