June 17, 2009
Corporate Welfare and health care rip offs
The Right is waging a massive, well financed, campaign to demonize the Obama administration, to rule out single payer, and to paint reform efforts as "socialist", but the fact is that the biggest drain on our medical system is its for profit members. At the very least we should require all basic insurance companies to be non-profit. If you want to have genuine reform support HR 676. If you want to see these things improve, call your Congress-critters. If you don't do it, you might be able to get up on a pitty pot later, but you can only thank yourself for the state off affairs when Congress proves it is the best Congress money can buy once again.
It is up to us to make Democracy work. We have to fight/struggle against those who have declared themselves enemies of democracy whether they are corporatists, economic royalists, or simply shills for anti-democratic groups.
The battle isn't "socialism versus capitalism" -- the health care insurers and big businesses don't want competition, they don't want free markets, they want to profiteer and get paid by both the taxpayer, out of our payrolls, and by denying us benefits, treatments, and providing shoddy service. The Government can run the insurance portion of our health system cheaper, more economically, and better than for profit businesses. It is as simple as that, they want to loot the commons.
http://www.pnhp.org/news/2003/june/tax_subsidies_for_pr.php
The highest medical costs in the US are in McAllen Texas, where Malpractice payments are capped at 250,000, and lawsuits are almost non-exstent:
http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all
However, what is operative is corporate greed to such an extreme that it filters down to the physicians ordering procedures simply for the sake of boosting revenues. As an alternative, we could pay physicians a salary (a good salary) and go to the Mayo Alternative; not for profit. Single payer is best, but if we can't have single payer we need trust busting and non-profits.
"Something even more worrisome is going on as well. In the war over the culture of medicine—the war over whether our country’s anchor model will be Mayo or McAllen—the Mayo model is losing. In the sharpest economic downturn that our health system has faced in half a century, many people in medicine don’t see why they should do the hard work of organizing themselves in ways that reduce waste and improve quality if it means sacrificing revenue."
"In El Paso, the for-profit health-care executive told me, a few leading physicians recently followed McAllen’s lead and opened their own centers for surgery and imaging. When I was in Tulsa a few months ago, a fellow-surgeon explained how he had made up for lost revenue by shifting his operations for well-insured patients to a specialty hospital that he partially owned while keeping his poor and uninsured patients at a nonprofit hospital in town. Even in Grand Junction, Michael Pramenko told me, “some of the doctors are beginning to complain about ‘leaving money on the table.’ ”
"As America struggles to extend health-care coverage while curbing health-care costs, we face a decision that is more important than whether we have a public-insurance option, more important than whether we will have a single-payer system in the long run or a mixture of public and private insurance, as we do now. The decision is whether we are going to reward the leaders who are trying to build a new generation of Mayos and Grand Junctions. If we don’t, McAllen won’t be an outlier. It will be our future. "
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Posted by cholte at June 17, 2009 12:42 PM
If you want to change the health care system you will have to address provider compensation and provider educational costs.
Doctors are the highest paid profession in America. If you want to control health care costs, you must addres this most fundamental issue of rich doctors and rich drug dealer pharmaceutical companies first.
Patrick
Patrick,
Indeed, but then when we look at these two obstacles, we realize they are deeply entrenched in the traditional perceptions of wholesome professions (as in doctors) or, in the case of big pharma, a 'good company to work for.' It brings us to the point where we need to openly question Western medicine in general as well as our archetypical notions of 'expert culture.' Very affordable or free healthcare also challenges and potentially re-shuffles the labor market by increasing the incentive for inherent risk takers to leave their "I-stay-because-of-the-benefits jobs" to get into various entrepreneurial ventures sans the bugaboo of absurd healthcare costs (ok, more than just a bugaboo).
It questions Control and what does Control say?
namaste
I agree with you Patrick. As for greedy doctors or greedy pharmacies, it's not so simple. The issue is that the system enables the greedy to game it, and the greedy are gamey and well organized while the rest of us are disorganized and susceptible to propaganda in advertising. In a few weeks the Chambers of Commerce are posed to mount a giant media campaign similar to the one they used to stop health care reform when the Clinton's were in office. Expect to see deceptive, false, misleading and even fraudulent advertising.
Our system is so corrupt that money is considered speech. Speech is only protected if it comes from the wealthy and powerful, and Corporations are treated as persons with more rights and privileges than you or I have. The fourth amendment still applies for them, just not for the rest of us. Hence they can buy Congressional Democrats, and already own Republicans.
We have to push back on many fronts, but health care is a lynchpin because its cost is draining the middle class, impoverishing almost everyone, and only making a few people incredibly wealthy. Most Doctors, even the greedy ones, are on a treadmill where they have to run at high speed to make money. This isn't good for their health or ours.
Moving to a Mayo clinic model, retainers for doctors, and outcomes based pay would help a lot. When HMO's first appeared they claimed to offer this before they switched into privateer mode and raised the Pirate flag. This can be promoted best by encouraging providers to go back to a non-profit model and by changing Government policies. It is not a good idea to nationalize all the providers, just the payment system.
There are some fundamental flaws. Insurance is, by definition, a transfer of a risk. You pay an insurer a premium; they assume your risk. Put another way, we buy insurance "just in case." Forty years ago, people bought health insurance 'just in case' they had an accident or caught as serious disease. It was intended to pay for hospitalization and the medical treatment of disease or injury.
Consider some of the things we insure. We buy home owner's insurance just in case our house burns down. We buy liability insurance just in case we get sued and lose. We have unemployment insurance just in case we lose our job. We have disability insurance just in case we lose the ability to work. We insure a package just in case it gets lost or damaged during shipment. We buy life insurance just in case we die prematurely.
Consider some things we do not finance with insurance. We do not buy food insurance just in case we might need to eat. We do not buy clothing insurance just in case we need to get dressed. The needs for food and clothing are not insurable risks. Think about it. What would happen if we paid for food with an insurance card? You do not know the price of anything; you just get your food, give them a card, and they bill the insurance company.
At some point, we decided that insurance should cover more than the risk of having an accident or getting sick. We decided it should cover pregnancy; which is not a sickness. We decided that it should pay for medical exams as preventive medical treatment. This probably started with pre-paid medical care; which evolved into the Health Maintenance Organization. That evolved into something real ugly called "managed care. " We have frigging insurance company bean counters rationing health care.
I understand the rationale of an HMO. Preventive care was going to catch things early, and reduce costs in the long run. Has it worked out that way? Proper diet and exercise probably actually does as much or more to prevent disease than doctor visits. Maybe health insurance should cover spa memberships? I think it does or did in some European countries.
The thing is you can not effectively insure against the risk of preventive health care, because it is not a risk at all, it is not a 'just in case.' If we pay for routine care with insurance, the cost is dollar for dollar; plus administration. Circa 1988, the first 1000 in a zero-deductible, fee for service, hospitalization & major medical plan, cost about $1200. That was the rational for deductibles. At that time, a $1000 deductible reduced the premium by $1200. Also, since we do not know the price or fee, they bill whatever they want. We wound up with five dollar charges for a Q-tip. That was the rationale for co-payments; to make the patient more cost conscious.
I am not saying we should not finance routine care. I am saying that insurance is probably the most expensive possible way to finance it. The concept of what I used to call Medical Spending Accounts makes more sense. You set up a cash account to pay for preventive care, then pay as you go. That eliminates any possible reason for a co-pay. Then, you buy a high deductible catastrophic major med plan; 'just in case' you have an accident or catch a serious disease. You eliminate most claims processing costs. You are insuring a risk, not pre-paying for services. So the premium is relatively cheap.
If we had gone to that twenty years ago, we might not have the mess we have now. The costs are so high now, it is hard, maybe impossible, to design anything affordable for mass markets. There are some limited, poorly structured, Health Savings Account {HSA} plans available. Finally, using insurance to finance routine care is not the only thing that drove costs up; but I think it was the biggest factor.
You have a point; "I am not saying we should not finance routine care. I am saying that insurance is probably the most expensive possible way to finance it."
But not because the concept is bad. On the contrary, the concept of spreading risks and costs across the broadest spectrum of people is the best way to finance health care. The problem is that we now have hundreds of for profit health agencies who spend huge quantities of overhead denying coverage, overcharging for services, or diverting money to overhead and executive salaries.
We need to have a non-profit health care system, and the best system would be a single payer one.
The country has been pushing for collective provision of medical services since the 19th century, and the concept dates to Thomas Paine and his book "The Rights of Man" who talked about it at the turn of the 18th century.
We band together as a society to provide for the general good; fire departments, community swimming pools, hospitals, in order to afford things for the public good that most individuals (except economic barons) can't afford on their own. We buy fire insurance, but we also provide for the public good of fire-departments. We should be able to buy health insurance, but the public good of health care should be a right of citizenship -- just as having a visit by the fire-department is. It lowers the costs for everybody.
Our current system is such that "rainy days" are inevitable with regard to health care. Sooner or later many of us need something expensive that we can't afford at the moment by ourselves. Hence we need to spread the risk.
We provided policies and tax incentives to corporations to provide private health insurance because the Republican party, the corporations, and the wealthy in this country opposed providing health care as a general good akin to providing fire departments. In 1947 Truman fought for health as a right and was defeated, largely because he had invested all his capital in the Korean war and helped elect conservatives.
As you note, insurance is inadequate to provide for what should be a general public good, and we went to a mixed private public system, where for profit HMO's, Insurance Companies, and Hospitals ration care while charging ungodly premiums to people. Thus we have the worst of both worlds; the public is not really provided a "free market" in health care because they are forced to pay for insurance, to pay for medicare and medicare, and payroll deductions. Meanwhile Doctors are also ruled by the for profit middlemen.
>>>Wrong Robin.
Good old Chris. Still the warrior.
>>>We band together as a society to provide for the general good; ... community swimming pools, ..., in order to afford things for the public good that most individuals (except economic barons) can't afford on their own. We buy fire insurance, but we also provide for the public good of fire-departments.
If you think about it, you have understood the point. We go not pay for the swimming pool with insurance.
>>>As you note, insurance is inadequate to provide for what should be a general public good,
No, that was not what I noted. The point is that insurance is the wrong way to pay for routine services. Insurance is to protect against risks.
>>> You have made my point; "I am not saying we should not finance routine care. I am saying that insurance is probably the most expensive possible way to finance it." But not because the concept is bad. On the contrary, the concept of spreading risks and costs across the broadest spectrum of people is the best way to finance health care.
Your point, my point. Is it who or what? This not about me. The concept is bad. Preventive Health care is simply not a risk. It is a routine service.
One thing we could do, is to set up some kind of universal socialized medicine to cover routine and preventive care. Then we could allow insurance companies to get back to their proper business of insuring against the risk of an accident or serious sickness. A health insurance policy, in this economy, should probably have at least a $10,000 deductible. Riders could be added to reduce or eliminate the deductible for accidents only. Basic, universal care would also reduce burdens on companies that are supposed to make and sell things; not provide employee health & welfare benefits.
That might require federal legislation to regulate insurers. Trouble is, the States regulate them. So we have 51 sets of regulations. The most practical way to fix that is 'open borders.' The only other ways would be federal mandates {ugh}, stretching the commerce clause even further {ugh}, or a constitutional amendment {tough to do}.
It will be interesting to see what kind of mess the Democrats come up with.
* Maybe a federal mandate requiring parents to insure their children.
* A sliding scale medicare buy in.
* Removing the childless adults medicaid exclusion,
* Some kind of cap on what is a double tax exemption for employer paid health care benefits.
Single Payor will not pass now. Obama's 'public option' is a back door, incremental approach to Single Payer. I do not see how private insurers can compete with a public option.
I doubt that President Obama can even ram through a new public option. A combo of Medicare buy-in and Medicaid expansion does the same thing. I might be wrong on that. It might make sense to consolidate Medicaid, Medicare, & the Federal Employee plan into a public option? There might be constitutional issues. Medicare is tied to Social Security. Medicaid is technically a state program.
I also doubt he can get mandatory insurance for adults, we shall see. Way back when, during the Hillary Care debate, I predicted that Democrats would eventually call for mandatory health insurance, and was laughed at. I made the same prediction in 2007, and was laughed at again. Obama might get it for kids.
There is also the factor of racism involved here. The legacy of racially segregated hospitals also inhibits the universal health care mandate.
It's one disease that pink pills alone, even free ones, cannot cure.
namaste
Well Robin, see new post. I think that even Republicans would agree we need to make health care a right and a public good. We don't need to set it up so that everybody can game it, or so that folks can become free riders, or make billions off of it. We just need to create a system that works justly, fairly, is affordable, and is available to everyone.
For further comments see new blog entry.