Essays
Problem with health care is
for-profit insurance
This piece
originally appeared on the Register-Guard (Eugene, Ore),
Jan 9, 2012
Author: Samuel Metz
and Charlotte Maloney
Date: 01/09/2012
Modern mythology recounts James Carville giving candidate
Bill Clinton memorable advice regarding his upcoming
presidential campaign: “It’s the economy, stupid.” Those
of us wrestling with health care reform might take similar
advice: “It’s the financing, stupid.”
Why do politicians such as Sen. Ron Wyden, D-Ore., and
Rep. Paul Ryan, R-Wis., obsess with untried models of
health care reform? They propose a “premium support
option” for Medicare that would also extend to small
businesses. Insurance companies are expected to compete
with traditional Medicare to provide comprehensive
benefits at affordable prices. Beneficiaries unable to
afford premiums will receive vouchers of limited sums to
support their premiums; hence the name, “premium support.”
This plan presumes that private insurance companies will
eagerly compete for market share by offering better
benefits at lower prices to our seniors. This simply does
not happen.
Our two congressmen may be confusing American insurance
companies with those in Europe. European companies are
forbidden to discriminate on the basis of health, must
offer policies to any applicant, must supply comprehensive
benefits in every policy, and cannot cancel a policy for
any reason. They compete by offering better benefits at
lower costs with better customer service.
In contrast, American insurance companies play by entirely
different rules. They compete by refusing policies to sick
applicants, shrinking benefits, dropping policy holders as
soon as they get sick, and denying or delaying payment to
providers. In short, they compete by providing less care
to fewer people.
Our last experience with letting private insurance
companies compete for seniors (Medicare Advantage)
reconfirmed this: Private insurance companies skimmed off
the healthiest seniors and provided them with no better
benefits than traditional Medicare except they cost the
government 15 percent more. Why should we expect private
insurance to be more successful than Medicare with the
Wyden-Ryan plan?
If we define a “successful” health care system as one that
delivers better care to more people for less money than we
do, examples abound around the world and within our own
country. These systems come in all varieties — complete
government control, minimal government control, private
providers, group providers, fee-for-service physicians,
salaried physicians, managed care, medical homes — you
name the variation, and it’s been used successfully. The
United States uses all of these, but our health care is in
the pits.
The United States lacks the three common elements used in
every successful health care system. And these elements
are not delivery methods; they are financing methods:
* Everyone is included forever. No exclusion for any
reason. No one is dropped or marginalized when they become
old, sick, poor or unemployed.
* Little or no cost-sharing. No patient is discouraged
from seeking health care. Instead of making a patient
decide if they need medical care before seeing a
physician, the physician decides after seeing the patient.
* Financing is provided by publicly accountable,
transparent, not-for-profit agencies. Although some models
permit profits from delivering health care, none allows
profits from financing health care.
Successful systems can make almost any delivery method
succeed, but only when financing fulfills these elements
(unlike the Wyden-Paul proposal, which fails to address
any of them). No delivery system has ever succeeded in
their absence. Though pundits may obsess endlessly why
these requirements are theoretically unnecessary, the
reality is stark. Bad financing makes any delivery system
fail.
America appears wedded to our traditional (and
unsuccessful) private health insurance industry that
fragments us into the healthy (who can purchase access to
health care) and the sick (who can’t). And the
fragmentation is not static. If you were previously
healthy but become sick, your insurance company will do
its best to exclude you from access on their dollar.
No other nation has provided universal cost-effective
health care with this method. We haven’t either. There is
no reason to think it will work in the future.
Wyden and Ryan neatly avoid tampering with our lethal
dependence on financing health care with private
insurance. This continues to place the health of the
private insurance industry over the health of the people
they serve.
Without a change in health care financing, reform is
futile. In all recorded history and throughout the world
today, we find no working models of a society providing
universal cost-effective health care using our unique
American system of private health insurance. It is
possible Neanderthals achieved this goal with private
insurance but left no written record. Doubtful.
We spin our wheels by focusing on our delivery system.
It’s the financing, stupid.
Charlotte Maloney of Eugene is a retired occupational
therapist and outgoing treasurer of Health Care for
All-Oregon. Samuel Metz, M.D., of Portland is a member of
the Oregon Single Payer Coalition.