Zeal For Truth

With the recent presidential debates and the debut of Michael Moore’s newest film “Sicko”, it seems that the issue of healthcare is of serious concern. Especially when one considers the recent statistics of 43.6 Americans are without health insurance, it can be argued that these concerns are not without merit.

Or are they?

While it can be viewed as tragic, the repercussions of such concerns infecting our political scheme give me more than just a case of the chills. Advocates of a single-payer socialized health-care program infect both Democrats and (arguably) some Republicans (I know that Mitt Romney does not directly endorse a tax-paid socialized system, his efforts to extend and basically require health insurance to all will require more government involvement in this issue than a true conservative, or economically savvy American should be comfortable with, even considering him throwing around words like “market” and “tax-free”.) Also, considering that Health-Care is the leading domestic issue of polled Americans, it is worth taking a closer look.

With such a large and encompassing (and admittedly emotional) issue, it is difficult to cover all views and aspects. I would like to focus on a few key issues and misconceptions, which I hope the readers here will research, discuss and elaborate accordingly.

Most advocates endorse a single-payer plan, as seen in Canada, and most European nations. While not entirely the same, the ideas behind such universal systems all operate under the same principle; providing guaranteed healthcare to ALL citizens, provided courtesy of their respective reigning government. Since 1987, the Physicians for a National Health Program (or PNHP for short) have been advocating single-payer, universal healthcare for all US citizens. They have served as an example for many advocates of universal care (including lobby groups and presidential/congressional hopefuls), so it is reasonable to use their stance as a starting point, since many of the issues and concerns being presented by today’s politicians are reflected by PNHP.

(For reference, I will be using the FAQ section on the PNHP website as jumping off points)

Single-payer is defined as:

…national health insurance is a system in which a single public or quasi-public agency organizes health financing, but delivery of care remains largely private.

In other words, they claim that while it is “publicly financed”, it is still essential “private”. This will be the first item of discussion.

”Universal care is not socialized, but publicly funded private care”

To anyone beyond a 3rd grade reading comprehension and economic understanding, this will read as a large misnomer. Their claim, is that since the government only pays for the care, but does not give the care, it is still private. According to their website:

Socialized medicine is a system in which doctors and hospitals work for the government and draw salaries from the government. Doctors in the Veterans Administration and the Armed Services are paid this way. Examples also exist in Great Britain and Spain. But in most European countries, Canada, Australia and Japan they have socialized financing, or socialized health insurance, not socialized medicine. The government pays for care that is delivered in the private (mostly not-for-profit) sector. This is similar to how Medicare works in this country. Doctors are in private practice and are paid on a fee-for-service basis from government funds. The government does not own or manage their medical practices or hospitals.

If a physician belongs to a large HMO group, do they not work for the HMO? Is their care-giving not controlled directly by who foots the bill? Under our current system, insurance companies can decide whether certain procedures/care/drugs will be paid. Therefore, the control of healthcare is directly under the supervision of the paying body, namely the HMO. Transferring such power the US government does not change this basic fact.

”Medicare/Medicaid is more efficient than private insurance”

According to the website:

The United States has the most bureaucratic health care system in the world. Over 24% of every health care dollar goes to paperwork, overhead, CEO salaries, profits, and other non-clinical costs. Because the U.S. does not have a system that serves everyone and instead has over 1,500 different insurance plans, each with their own marketing, paperwork, enrollment, premiums, rules, and regulations, our insurance system is both extremely complex and fragmented. The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO.

Yet, a few lines down:

Whenever we allow the wealthy to buy better care or jump the queue, health care for the rest of us suffers. One need only look at the example of the nation’s health insurance program for the poor, versus the National Naval Medical Center in Bethesda, MD, that serves members of Congress. Access to care for the poor is deteriorating because Medicaid is a grossly underfunded health care program. Because it doesn’t serve the wealthy, the payment rates are low and many physicians refuse to see Medicaid patients. D.C. General Hospital in D.C., which serves the poor, is always on the brink of bankruptcy. Calls to improve Medicaid fall on deaf ears because the beneficiaries are not considered to be politically important. On the other hand, members of Congress have completely free access to care at National Naval, where the quality of care couldn’t be better.

While efficient, why is it that more and more physicians are jumping the Medicare ship? The problem? Reimbursement. Medicare underpays physicians so much that care to these patients if often denied. According to Medicare payments, as discussed here,

When your doctor or supplier agrees to accept the charge approved by Medicare as total payment for services, this is called “accepting Medicare assignment.” Medicare pays your doctor or supplier 80 percent of the Medicare-approved charge, after subtracting any part of the $131 annual deductible you have not met. For covered services, the doctor or supplier can charge you only for the amount applied to the deductible and the remaining 20 percent of the approved charge.

In other words, it is Medicare that decides what it will cost, then pays 80% of it. Then, accordingly, depending on whether or not the physician is under and agreement clause with Medicare (a “take it or leave it and don’t ask questions” approach), the physician must accept what they are paid as full-payment, regardless of actual cost of the care.

This approach, of course, would make any system rather “efficient”, now wouldn’t it? Medicare takes in money (from taxes) to pay for services, but then does not fully pay for said services. They “spend” less than they take “in”, making them “efficient”. Yet, doesn’t that defeat the purpose? If this efficiency is so important, why is the hospital that serves the “poor” under the constant shadow of bankruptcy? Why does it provide reduced care? Of course, the argument is that Medicare is “underfunded”.

”Universal Care will cost less then our current system”

Anyone with a basic understanding of free-markets will laugh at such a claim. How does one expect a monopoly to actually cost less? Again, according to the website:

The U.S. Supreme Court recently established that rationing is fundamental to the way managed care conducts business. Rationing in U.S. health care is based on income: if you can afford care you get it, if you can’t, you don’t. A recent study by the prestigious Institute of Medicine found that 18,000 Americans die every year because they don’t have health insurance. That’s rationing. No other industrialized nation rations health care to the degree that the U.S. does.

If we are to provide the same healthcare to all, including the have AND the have-nots, how will this reduce costs? If healthcare costs are already high for those who CAN afford it, how much more will it cost if the service is provided for those that currently can’t pay for it? Of course, such a system is already in place.

In most Emergency Departments, care has to be given, regardless of payment. More often then not, this cost is never re-couped. Instead, the cost is then distributed throughout the hospital by increasing cost of procedures/care, billing extra to insurance companies who, in turn, increase premiums. Healthcare costs go up all around, in order to help cover the cost of those that can’t pay. Adopting this system under a universal banner, will do no more to decrease cost than lighting a $10 bill on fire is equivalent to spending it.

For the remainder of this discussion, let’s look at the purpose of insurance itself, and misnomers on the actual cost to have it.

Comedian Chris Rock on insurance:

They shouldn’t even call it insurance, they should call it incase s***. I give the company some money, incase s*** happened.

While crude, it is rather concise, isn’t it? Insurance is to “insure” that in case something happens, you are covered. It’s a gamble. You pay money every month, just in case.

Let’s use an example: car insurance. You pay, every month, so in case something happens to your car, you are covered. Now, you can not have insurance (assume here it’s not a requirement of law) and gamble that you won’t get in an accident. Or you can gamble that paying a monthly fee and never using it, is still cheaper than paying out-of-pocket directly for something that does or could happen. Yet, how is car insurance fair? If someone has a history of expensive accidents and speeding violations, is it fair to make the “safe” drivers pay more? Can’t car insurance companies force dangerous drivers to drive “safer”? Not directly. Instead, they charge them more, since at-risk drivers are higher at-risk for increasing costs.

Now imagine, for a moment, that car insurance also covered “preventative” and “maintenance” care on your vehicle. Let us say that every time you got your oil changed, your tires rotated, your brakes fixed, you billed your car insurance. How much higher would your insurance premiums increase? If all were required to pay for oil changes to those that “could not afford it”, how much higher then would premiums be? How much higher then would the cost of oil changes become?

With health insurance, this is no different. Health insurance itself is expensive, because such things as basic, preventative care, are billed to insurance. Considering that a majority of the top 10 killers of men are mostly preventable, it’s enough to make you wonder if we are indeed paying for “care”, or paying for other people’s personal choices. Would it be tolerated by those who pay car insurance if part of premiums paid for upholstery cleaning to those who smoke/eat/drink in their cars? Not without demands of increased rates or insurance denials. Yet, according to the PNHP website:

Experience rated insurance requires higher risk people to pay higher premiums. This approach says that people who have had cancer or other problems in the past, or who have chronic conditions like diabetes and hypertension, must pay more because they are at higher risk of getting cancer again or having a stroke or other health problem. Experience rating allows insurance companies to “cherry pick” the healthiest people and either refuse to insure the sickest or, what amounts to the same thing, charge prohibitively high rates. This approach makes no sense. The whole point of insurance is to spread the risk so that everyone is covered.

If one cannot distribute based on risk, how does this bring costs down? How is it therefore paid? If you cannot charge higher risk patrons MORE, then EVERYONE has to pay more to be “fair”, according to such a system as single-payer. This alone shows that costs will increase, just based on risk.

Of course, the biggest push for single-payer is the belief that since 43.6 million Americans HAVE no insurance, it is because they can’t afford health insurance. Is this true? Probably not as much as you think.

In order to justify universal coverage, it has to be shown that the issue is of so much public importance, that it will be a government mandated provision. Police to ensure safety, military to ensure protection, even roads to ensure travel. Yet, why is there not push for universal coverage of food? Shelter? Why are these basic “needs” not provided, courtesy of your tax dollars? Why can one not walk into a store, and take exactly the food that one needs to survive? Is food not of greater importance than roads and even police for daily survival? Is food not more important than even *gasp*health care? The fact remains that even those who push for single-payer healthcare, recognize the need for self-preservation. If one puts other things in front of food in importance, they are regarded as a fool. Yet, why the double standard when it comes to healthcare? If it is so important that it needs government intervention to provide it to all (over food!), then why is it often put last?

According to some statistics, 65 million Americans have basic cable, while 50.6 million Americans subscribe to premium channels.
, 248 million television sets in households in 2001, and an average of 2.4 television sets per home. Out of all households, over 70% have cable and/or satellite television. 62% of Americans have cell phones, of which 64% pay more than $50 per month. And, in case you are wondering about who most subscribers are, according to this article:

Seventy-five percent of Mission High students have cell phones, according to a recent survey conducted by Truitt, and many of those interviewed said they couldn’t live without them. But 75 percent of the school’s students are also so poor they qualify for free or reduced-price lunches.

These are just a few examples, illustrating the perception of cost. How much more would a family be able to afford healthcare, if they went without such things as televisions, cable, satellite, and $200/month cell phone bills? If healthcare is so important, why do such trivial items come first?

Perhaps it is not our system that needs reformation as much as the people that it covers.