Defending an indefensible health system
Thousands of angry protesters turned out at town hall meetings in Hillsboro, Cape Girardeau and across the country this week. They had come to pledge their unstinting support for the world’s 37th best-performing health care system.
The protesters vowed to protect a system that is, hands down, the world’s most expensive. It will consume an estimated $2.5 trillion this year — twice what it cost a decade ago, just over half what it is projected to cost in 10 years.
Yet in an apples-to-apples comparison, it produces lower average life expectancy and higher infant mortality rates than most other developed nations and performs poorly on many other important measures.
That is in large part because it is the most unequal system in any industrialized country. About 50 million people have only limited access because they have no health insurance. Roughly 24,000 people died last year as a direct result of being uninsured.
Millions more have coverage that is inadequate to protect against catastrophic medical debt. Thousands will be bankrupted this year just because they had the misfortune to get sick.
That’s the system opponents of health reform are fighting to protect.
The trade magazine Modern Healthcare is read by some of America’s most knowledgeable industry insiders, including doctors, hospital and insurance executives and academic researchers. It polled 208 health experts last month. More than two-thirds said comprehensive health reform should be enacted this year.
Doctors, hospital and insurance groups, drug and medical device makers all have come out in favor of reform. They may disagree on details, but they all recognize that the current system is unsustainable.
• Administrative costs are two or three times higher than in other countries, mostly because of our needlessly complex system.
• Between 20 cents and 33 cents of every dollar is spent on medical treatment that provides no real benefit to patients.
• A lack of integration — communication failures and poor follow-up among family doctors, specialists, hospitals and home-care agencies — undermines physicians’ efforts and compromises patients’ health.
• Costs are soaring out of sight, siphoning off money that could be used to improve roads and education or develop new energy technology.
Those missed investment opportunities add social costs over and above the $2.5 trillion we’re already spending on health care. There’s a reason opponents haven’t presented a coherent case against health reform: There is no coherent case to make.
There is plenty of room for reasoned debate about the details. But opponents are relying instead on wild exaggerations and outright falsehoods in their increasingly hysterical attacks.
• Euthanasia? Hospitals have been required since 1990 to provide information about living wills to every patient. Has that led to euthanasia — to what former vice presidential candidate Sarah Palin recently called “death panels”?
• A “government takeover” of health care? Federal and state government payments already account for more than half of health spending. That includes money for Medicare, which — to the evident surprise of at least some protesters — is and always has been a government program.
• Socialized medicine? A Canadian-style system? Even Canada doesn’t have socialized medicine (though the U.S. military does). Nothing in any reform proposal would create a Canadian-style health care system here.
• Most cynically, opponents are sowing fear that reform means people will lose access to their current coverage. The truth is just the opposite: Without reform, millions of Americans who now get insurance through their jobs will lose it over the next 10 years as premiums continue to soar.
If opponents have a good argument against reform, they should make it honestly.
But don’t hold your breath. Defending the indefensible is pretty near impossible.
“Administrative costs are two or three times higher than in other countries, mostly because of our needlessly complex system”
You mean bloated layers of government regulations. And now some people want the government MORE involved? No thanks. Have any of you wanting more govt control ever dealt with the VA or Tricare? If so, I’m sure you’d change your tune.
If you think healthcare is expensive now, wait till it’s free.
I guess this is one way to win an argument.
1. Claim that your opponents are arguing for something that they aren’t. Who exactly has put forward a plan that says “Keep everything exactly the way it is now”? Now, given that the makeup of Congress is such that the only plan that could possibly pass would be one that is decidedly more liberal (more apt to allow government control) than conservative, the outcome of the current session would be either a liberal plan or no plan. This does not mean that conservatives wish to maintain the status quo. People like Congressman Paul Ryan have been pushing a conservative option for a few years now.
2. And then quote questionable studies that are influenced by how much government controls health care to determine quality of said system to slime those opponents. What is it that a native son of Missouri used to say about statistics? It’s not all that hard to skew the results to be how you want them when you can control the input variables to favor your outcome.
3. While simultaneously assuming that the problem is really one of health insurance and not the health care industry. The cost of health insurance is a function of the health care market (or this thing that is supposed to be a market but hasn’t been a functioning market since 1965). As health care costs rise, so will health insurance premiums since we incentivize individuals to claim everything under the sun on their insurance plan.
4. Opponents have been making a coherent case. You just aren’t listening. See Rep Paul Ryan of above. See Michael Tanner and Michael Cannon at CATO. See Greg Scandlen. See a brilliant op-ed by Whole Foods’ CEO John Mackey in the Wall Street Journal. Etc.
As to some of the points that you make.
1. Higher administrative costs exist because you are not comparing things that are alike. In other countries, as with Medicare and Medicaid, there are many costs that are not included in their budgets. For example, in the private health care market, insurance companies have to have departments for billing, legal teams, etc that government run entities include in other budgets. The costs of the IRS collecting premiums are not included in the costs of Medicare. Neither is the costs of prosecuting those who commit fraud against the system. The same goes for many other countries. They shift those costs to other departments to make their numbers look better. {Gee, that sounds an awful lot like Enron style accounting to me}
2. Wasteful spending exists for several reasons. First, doctors practice a lot of CYA. They get sued (a lot). The best defense against a law suit is to show that you “did everything you could”. Even if that means ordering tests that have little to no benefit to diagnosis. Second, people bear a small portion of the costs of their decisions. When covered by insurance, the cost difference between an X-ray or an MRI seem quite small. When an X-ray will suffice (which costs far less) many will insist on receiving the MRI because they think it will give better results (at much higher cost). Because of the insurance coverage that they do have, they never see the true impact of that decision.
3. People most assuredly will lose their current coverage under the current proposals in front of congress. Own an insurance plan that is not exchange approved? You can keep it until the company has to alter the plan. Then you are forced to buy a policy from the exchange which is likely to be more expensive than the one you had before. On a company run plan? When faced with the decision between paying you $4000 for your individual plan or $12000 for a family plan versus a $750 fine for not providing insurance coverage, which do you think your employer is going to choose? If you said that they would continue to offer coverage you should be reminded that companies are looking to cut costs everywhere, especially these days. And cutting costs by millions of dollars would just be far too attractive to many companies to ignore.
A topic that you really miss covering here is how the current proposals will lead to a decrease in employee wages. If an employer is required to provide insurance coverage or face a fine, their costs of employing someone are going to go up in either instance if they don’t already offer health coverage. In an environment where wages are already seeing very slow growth, this would shift additional compensation dollars to health care since employers already cannot afford to both increase wages and health care premium contributions at adequate rates. Forcing them to put more into the health care premium contribution means that there will be fewer dollars available for wage increases. In extreme cases, this could even mean a reduction in either wages or number of employees if costs get too far out of hand.
{P.S. Is this reasoned enough debate for you? Or am I just trying to “fear monger” as you have so broadly painted the “anti-reformists”?}
Actually, the VA Hospital actually has some of the most advanced equipment and efficient operations comparable to many private institutions. I would know because, I was a patient for 3 weeks at a VA hospital in Arkansas. Have YOU ever dealt with the VA or Tricare? I’m guessing you probably haven’t. And you are wrong. The reason why health care in America is so expensive is mainly because greedy insurance companies and doctors try to charge people exorbitant fees like $6000 for three stitches. See: http://www.nytimes.com/2009/08/12/health/policy/12insure.html
Yes, I would rather have the government intervene and help bring rational thinking to the health care system that is constructed not to actually help people get better, but to make those involved in the health care industry along with their supporters richer. It’s about time the government started working for the average people of America and not for those greedy bastards in the health care and pharmaceutical companies with big pockets!
Our infant mortality rate appears higher because we actually follow the guidelines that other countries dont.
“The U.S.’ infant mortality rate is not higher; the rates of Canada and many European countries are artificially low, due to more restrictive definitions of live birth. There also are variations in the willingness of nations to save very low birth weight and gestation babies.
The ethnic heterogeneity of the U.S. works against it because different ethnic and cultural groups may have widely different risk factors and genetic predispositions.
Definitions of a live birth, and therefore which babies are counted in the infant mortality statistics very considerably. The U.S. uses the full WHO definition, while Germany omits one of the four criteria. The U.K. defines a still birth “a child which has issued forth from its mother after the twenty-fourth week of pregnancy and which did not at any time after being completely expelled from its mother breathe or show any other signs of life.”
This leaves what constitutes a sign of life open and places those born before 24 weeks in a gray area. Canada uses the complete WHO definition but struggles with tens of thousands of missing birth records and increasing numbers of mothers sent to the U.S. for care.2 France requires “a medical certificate [that] attests that the child was born ‘alive and viable’” for baby who died soon after birth to be counted, which may be difficult to obtain.
37th? This from the UN ran WHO, whose findings are suspect:
The media and political community have made a big deal out of the fact that the U.S. ranks 37 out of 191 countries on the World Health Organization’s Health Care Ranking System. Is this tool a credible way to compare quality health care delivered in the U.S. vs the rest of the world?
Let’s be perfectly clear about this, the United States Health Care is second to none! Ask the tens of thousands of patients who travel internationally to the US every year for their health care. As an example of the quality of health care delivered in the US, Americans have a higher survival rate than any other country on earth for 13 of 16 of the most common cancers. Perhaps that is why Belinda Stronach, former liberal member of the Canadian Parliament and Cabinet member (one of the health care systems touted as “superior” to the US) abandoned the Canadian Health Care system to undergo her cancer treatment in California.1
But to understand how WHO derives this misleading statistic, which has been ballyhooed widely by both the media and politicians alike, you need to understand how it is created. WHO’s health care rankings are constructed from five factors each weighted according to a formula derived by WHO. These are:
1. Health Level: 25 percent
2. Health Distribution: 25 percent
3. Responsiveness: 12.5 percent
4. Responsiveness Distribution: 12.5 percent
5. Financial Fairness: 25 percent
“Health level” is a measure of a countries “disability adjusted life expectancy”. This factor makes sense, since it is a direct measure of the health of a country’s residents. However, even “life expectancy” can be affected by many factors not related to health care per se, such as poverty, homicide rate, dietary habits, accident rate, tobacco use, etc. In fact, if you remove the homicide rate and accidental death rate from MVA’s from this statistic, citizens of the US have a longer life expectancy than any other country on earth.2
“Responsiveness” measures a variety of factors such as speed of service, choice of doctors, and amenities (e.g. quality of linens). Some of these make sense to include (speed of service) but some have no direct relationship to health care (quality of linens). These two factors at least make some sense in a ranking of health care, but each is problematic as well.
The other three factors are even worse. “Financial fairness” measures the percentage of household income spent on health care. It can be expected that the “percentage” of income spent on health care decreases with increasing income, just as is true for food purchases and housing. Thus, this factor does not measure the quality or delivery of health care, but the value judgment that everyone should pay the same “percentage” of their income on health care even regardless of their income or use of the system. This factor is biased to make countries that rely on free market incentives look inferior. It rewards countries that spend the same percentage of household income on health care, and punishes those that spend either a higher or lower percentage, regardless of the impact on health. In the extreme then, a country in which all health care is paid for by the government (with money derived from a progressive tax system), but delivers horrible health care, will score perfectly in this ranking, whereas a country where the amount paid for health care is based on use of the system, but delivers excellent health care will rank poorly. To use this factor to justify more government involvement in health care, therefore, is using circular reasoning since this factor is designed to favor government intervention.
“Health Distribution and Responsiveness Distribution” measure inequality in the other factors. In other words, neither factor actually measures the quality of health care delivery, because “inequality of delivery” is independent of “quality of care”. It is possible, for example, to have great inequality in a health care system where the majority of the population gets “excellent” health care, but a minority only gets “good” health care. This system would rank more poorly on these measures than another country that had “equal”, but poor, health care throughout the system.
In summary, therefore, the WHO ranking system has minimal objectivity in its “ranking” of world health. It more accurately can be described as a ranking system inherently biased to reward the uniformity of “government” delivered (i.e. “socialized”) health care, independent of the care actually delivered. In that regard the relatively low ranking of the US in the WHO system can be viewed as a “positive” testament to at least some residual “free market” influence (also read “personal freedom”) in the American Health Care system.
Life expectancy?
While the overall life expectancy of Americans is lower than that of people other nations, it the result of higher rates of homicides, accidents, and obesity, factors that are at best tangentially related to the health care system.
The homicide rate in the U.S. was 5.9 per 100,000 people in 2004, according to the U.S. Department of Justice. In contrast, it was 1.99 per 100,000 in Canada, 1.66 in France, .98 in Germany, and 1.63 in England and Wales (approximately 1.71 including Scotland.) 1
In the U.S., in 2006 there were 14.24 fatalities per 100,000 people from auto accidents.2 Canada had 9.25 fatalities2, France 7.43, Germany 6.194, and 5.39 in Great Britain (U.K. excluding North Ireland)5. In general, injuries of all kinds accounted for 47 deaths per 100,000 in the U.S. in 2002 but 26 in the U.K., 29 in Germany and 34 in Canada. Only France, at 48 per 100,000 was equivalent.6
While Americans are not the most likely to be overweight, they are more likely to be obese than people in other nations. While critics of the U.S. system often try to drag the issues of obesity into the realm of health care failures, it is the result of complex factors related to culture and economics as much as to health.
The U.S. has a very heterogeneous population with many ethnicities and nationalities represented. With this diversity comes not only genetic differences but also cultural and lifestyle ones that can affect health and life expectancy. African-Americans in particular have low life expectancies, well below those of other ethnic groups. Life expectancy can often be correlated to country of origin, with those from nations with high expectancies showing equivalent, or even greater, life expectancies.
While 2008 data shows that life expectancy at birth is higher in the Netherlands than in the U.S., for both men and women (76.66 vs. 75.29 and 81.6 vs. 81.13) this advantage reverses when you look at those who have reached 65.7 In 2007, the rate of traffic fatalities was 4.84 per 100,0008 and the homicide rate in Holland is 1.27 per 100,000 population, less than a quarter the rate for the U.S.9 Injuries also claim fewer lives in the Netherlands than in other countries, only 23 per 100,000 people in the 2002.10
The life expectancy at birth in Switzerland is 80.74 (77.91 for men, 83.71 for women) and those who make it to 65 can expect to live to 81.9 for men and 86 for women.11 But Switzerland has a number of advantages that influence these statistics. It is a small country with a quite homogenous population, low infant mortality due to its restrictions in counting premature babies, and relatively low rates of automobile accidents and homicides. In 2007, Switzerland had a vehicle accident fatality rate of 5.06 per 100,00012 and the homicide rate in Switzerland was 2.95 per 100,000 people in 2004.13 As for injuries, in 2002, 32 per 100,000 deaths were from this cause, versus 47 per 100,000 in the U.S.
AJ,
Are you actually saying that the healthcare industry needs LESS regulation. Aside from being completely absurd to allow PRIVATE insurance providers more ways to deny coverage to their clients, haven’t you guys figured out that less regulation is what has caused the massive economic problems we are facing.
As for your VA comment, I recommend you ask any veteran if they would be willing to surrender their health benefits (hell ask any Medicare recipient the same thing)and lets see what kind of response you get.
JC,
I know this to be true. If you depend upon the government for anything, you’ll get the minimum. Regulation is not free as you think. Like taxes, they are simply costs passed on to the end user. That’s us. Why people don’t understand that is beyond me. If you think private insurers deny coverage, wait till the govt is running it and then get back w/ me.
In terms of the VA and Tricare, my wife received an injury that caused her to use Tricare and the VA to cover part of the costs and our private insurance to cover other parts. The private insurance was superior to the govt run insurance. We never even saw a bill from the private and everything was covered. However, we have stacks of paper from the govt and it was a colossal mess trying to figure out what they did and didn’t pay. You tell me which one is more efficient and then I’ll tell you about the misdiagnosis the govt made initially.
Shall we continue?
Infant mortality rates would go down if you didn’t kill so many of the healthy babies before they were born.
Take a look at why it is so expensive. Don’t your favorite trial lawyers have something to do with that?
50 million? Ha! Try 9 million. Subtract the illegals. Subtract those that can afford healthcare and chose not to. Subtract foreign workers.
You think it is expensive now? Wait until the government gets their hands on it. Yep, this is the same government that pays $1000 for a hammer. What is the biggest part of our budget today? Medicare/Medicaid.
Obama’s stated goal is to have a Canadian style health care system. That is undeniable.
Ask any wounded vet about life in a VA hospital.
AJ, sorry you had a problem with TRICARE. I think your case is the exception rather than the rule…as there are similar private insurance anecdotes. Your BSR should have provided more guidance. I spent my AF career as a medical service officer (i.e. managed care/TRICARE officer). I don’t agree with employer-based care; rather, the TRICARE system of government oversight of civilian contractor (which BTW was how you received your TRICARE…through civilian/private insurance) is far superior than our current system. Throw in tort reform, physician accountability, and personal responibility and we might just have a workable plan. I still believe however, that the president is working in our best interest even if I don’t necessarily agree with the current plan.
Also AJ…one possible reason you had problems with VA and TRICARE is that your private insurer was the “first payer” (by law TRICARE, Medicare, etc) are all “last payers”. Your private insurance worked as normal. TRICARE seemed a hassle because it was operating as a supplemental requiring additional paperwork
I am covered by the VA and have had private insurance in the past. No way I will go back to private insurance. The care is better at VA hospitals than in private. I have kidney stones and the private urologist was far behind modern treatment procedures compared to the VA. The staff treats me like a person instead of a number.
According to a recent study by the Rand Corp. The VA provides the best health care in the world and they are the most efficient.
Recently, I had to go to a private hospital for a stone. They of course have to do an MRI (an x-ray is all that is needed but, I guess they make more $ for an MRI) then gave me pain medication and discharged me. IT wasn’t ten minutes after I left that I realized that the staone hadn’t passed, the pain meds were wearing off and I need to go back. When I got back I was doubled over in pain and they wouldn’t admit me until I went thru and interview (the same one I did just 1.5 hours ago. I begged and pleaded not to have to go thru the whole process agian, they insisted asking questions like my address that they already had. The private insurance screener insisted that I ‘calm down’ and threatened to call security and have me thrown out. I explained I was just here? She insisited I ahd to calm down and answer all the questions if I wanted to get treated. ‘okay, okay. What do you want to know?’ and with a strait face she asked the next question, ‘have you ever been to this hospitol before?’
I’ll never go to another private hospitol agian if I can help it.