ORIGINAL FRENCH ARTICLE: Barack Obama. Loin de la couverture maladie universelle
by Leonard Rodberg, PhD
Translated Thursday 18 June 2009
US President Barack Obama has said repeatedly that he wants “ideas that work.” In spite of this, he has turned over health reform policymaking to the Congress, where leading Democrats are working actively on plans that will manifestly fail.
These plans, pushed by Sen. Max Baucus (D, MT) and other “moderate” Democrats, seek to have everyone insured by mandating the purchase of private insurance, with perhaps an option, offered to some individuals and businesses, to buy into some kind of government-sponsored plan. (At this writing, neither what kind of plan this would be, nor who could avail themselves of it, have been specified. Some advocate an expansive public plan that would provide coverage and security superior to private insurance; more conservative voices are insisting that, if there is to be a public plan, it should be as similar as possible to private insurance so it will compete “fairly” with private insurance.) Under this concept, the purchase of insurance would be facilitated through an “insurance exchange,” basically a listing of insurance plans or options that meet a set of national criteria. Insurance premiums for those with low income would be subsidized.
Supporters of these plans agree that reform must deal with three linked problems: (1) the large numbers of Americans without insurance, now approaching 50 million; (2) the high cost of health insurance in the US (the average annual premium for an employer-purchased family policy is now more than $12,500, fully one-fourth of the median family income); and (3) the continuing rise in the cost of health care, now at two to three times the rate of general inflation, making the problems of uninsurance and high cost worse with every passing day.
Consider these issues in turn:
These proposals would require that everyone buy insurance, but such a mandate cannot possibly assure that everyone is covered. A report published this past December by the US Congressional Budget Office shows that no existing government mandate, whether to purchase auto insurance, pay income taxes, or immunize children achieves more than 85% success. But the US already has close to 85% insured through the public Medicare and Medicaid programs and private insurance. So such a mandate is unlikely to move us very far toward the announced goal of “universal coverage.”
The US already spends far more on health care, per capita, than any other nation. Hundreds of billions of dollars are spent on insurance company overhead and profit as well in the billing systems maintained by every hospital and doctor’s office to deal with these insurance companies. Yet the Democrats’ proposals leave this wasteful and expensive system unchanged. In fact, far from saving money, they would add billions of dollars to what the US already spends. The Urban Institute has estimated that it would cost about $122 billion each year to provide the same level of care to those who are currently uninsured as the insured now have. However, that is not all. There is increasing recognition of the large numbers of “under-insured” in the US – estimated at one-third or more of all Americans — who cannot afford needed care because of the co-pays, deductibles, and spending limits imposed by their private insurance plans. Overcoming this “under-insurance” would add at least another $100 billion each year to the cost of insurance. However, the mainstream Democratic proposals do not envision any significant change in the way America’s private insurance works; “you can keep what you have” is a frequently-heard mantra from advocates of these proposals.
Advocates for the Democratic proposals claim future savings are possible, pointing to increased use of information technology, better management of chronic illness, and improved payment mechanisms for primary care. But the Congressional Budget Office, the arbiter for potential costs and savings in new government programs, finds that these measures are as likely to increase costs as to reduce them. Thus, these proposals do not offer any reliable mechanism for containing costs going into the future.
Advocates for a single payer, government-funded insurance mechanism – what is frequently called “Medicare for All” – have been excluded from these discussions. Under a single payer or national health insurance program, money would be collected through the national tax system. Doctors and hospitals would be reimbursed for their services by a public agency. This is the arrangement that now exists in the US for the elderly and disabled, under the Federal Government’s Medicare program. A single payer plan would be simply an expansion and improvement on this currently-existing program.
This proposal has been declared “off the table.” In fact, a number of single payer advocated have been arrested at hearings of the Senate Finance Committee for insisting publicly that it should be “on the table.” Polls show that nearly two-thirds of the American people support a single payer system, a recent poll found that 59% of doctors support such a plan, and more than 70 Members of Congress are co-sponsors of Rep. Conyers’ HR 676, the Enhanced and Improved Medicare for All Act. Nevertheless, the Democratic Party leadership, powerfully influenced by the lobbying and huge campaign contributions that the insurance industry makes to American politicians, and wary of the anti-government fervor that conservative forces can provoke in the United States, have prevented serious consideration of such a plan.
The single payer plan, besides having numerous vocal advocates across the country, has logic and policy analysis supporting it as well. Many people recognize that the only way to contain health care costs is to adopt a unified financing mechanism that would provide budgeting and planning tools that could constrain future costs. Further, unlike the Democratic proposals, a single payer plan could provide universal coverage with comprehensive benefits without any need to spend more than the US is now spending. Numerous studies have shown that the administrative costs of our multi-payer financing system consume nearly one-third of our health care dollars. Eliminating the wasteful and unnecessary billing and marketing costs of private insurance could save as much as $400 billion, more than enough to fund high quality care for those who lack it today. That is, only a plan such as the current Medicare program, that eliminates these wasteful and unnecessary expenses, can truly address the cost problem.
The bottom line is that the Democratic proposals would not really reform the current system; they would just add to it. They will not work. As long as the US continues to rely on a private multi-payer insurance system, universal coverage will be unachievable and costs will remain uncontrollable. Unless President Obama insists that such a plan should be “on the table,” true reform will yet again be postponed until another day.
Leonard Rodberg is Professor and Chair of Urban Studies at Queens College, City University of New York, and Research Director of the NY Metro Chapter of Physicians for a National Health Program