MAY 2018
As the healthcare debate
continues, misinformation continues to spiral out of control on social media
threads and in the mainstream media.
By now, we’ve all heard the
talking points:
"Don't other countries
with single payer experience really long wait times?"
"Why should we expand
Medicare? Don't a lot of people have negative experiences with it?"
"Why should I pay for
someone else's healthcare?"
It can be incredibly difficult
to differentiate the facts from the hype. We receive hundreds of questions
every day from our subscribers who, like you, are passionate about learning
more about the issues so that you can engage in more civil and informed
discourse. Below are answers to the top 10 questions we heard from you.
10 Questions About Healthcare,
Answered
1. How does healthcare in the
United States compare to other developed countries?
Simply put, we get less and
pay more than other countries. The United States spends over twice the average
amount per person on healthcare compared to every major industrialized country.
And we consistently rank 11th out of 11 countries in comparative studies
conducted bi-annually by the Commonwealth Fund:
30 million Americans are
uninsured and an additional 39 million are underinsured.
20% of insured Americans
report trouble paying medical bills.
36% of Americans are in
high-deductible plans with an average deductible of $4,347 or higher.
Americans pay excessive prices
for medical visits and procedures.
The fragmented and patchwork
system as compared to other countries necessitates over $200 billion per year
in administrative-related activities, or a total of 20-30% of all US healthcare
costs.
Despite the out-size spending,
the US experiences extremely poor health outcomes.
33% of Americans report going
without recommended care, they do not see a doctor when sick, or fail to fill a
prescription because of costs.
The United States has the
highest number of preventable deaths under the age of 18 when compared to 18
other industrialized countries.
The infant mortality rate is
nearly double the average rate of 13 major OECD countries.
In 2014, 68% of Americans over
the age of 65 were living with two or more chronic conditions, compared to only
33% in the UK.
The US has (uniquely) a
declining life expectancy age. Latino and Hispanic Americans have much lower
levels of insurance coverage; the health status of black Americans has declined
in recent years, according to a recent report by the Urban League. The number
of uninsured Americans has increased since the rollbacks of the Affordable Care
Act implemented by the Trump Administration. The standard of care Americans receive
varies based on ability to pay, type of coverage, and significantly by race and
gender. This is not true in other similar countries. According to report
released on May 8th, this lower quality of care comes as we spend $9,507 per
person per year on healthcare.
2. Prescription medication
prices are ridiculous. How did we get here?
According to a report by the
Senate Finance committee, prescription drug corporations price their drugs
according to the price point they want to establish for the next drug in that
class – so the ever increasing prices has nothing to do with research and
development costs, or efficacy of the medication, but rather whatever the
market will bear and specifically, whatever the market the drug companies
create will enable. There is no regulation of drug prices, and Medicare is
prohibited by law from negotiating lower prices. Hospitals and insurance
companies, ironically benefit from higher drug prices because those prices
“justify” higher rates, and generate more profit as a percentage of those
higher rates. The industry model of unregulated prices, direct to consumer
marketing, publicly supported basic research that leads to private drug
development, and profit-protecting patents have created escalating prices.
3. The ACA (Obamacare) was
supposed to cover everyone and keep costs down but they are much higher than
most people predicted they would be. What happened?
The ACA in the best case was
not going to achieve universal coverage – most optimistically, as many as 20
million people would remain uninsured after full implementation. Three-fifths
of the increase in coverage came thru expansion of Medicaid, but 23 states have
not expanded Medicaid. (The Supreme Court decision upholding the ACA in June,
2012, allowed states to opt out of the expansion). As to cost, the primary
approach was to require individuals to pay more of their share of healthcare
costs – “skin in the game” was the popular phrase - so that as “consumers” we
would be more price sensitive. But insurance rates were not regulated, so
companies could charge whatever they wanted, and hospitals were also allowed to
charge unregulated prices, as were drug companies. At the same time, the cost
of premiums has been subsidized by the federal government for individuals but
not for family coverage. The result has been a focus on keeping premiums low by
creating narrow networks of providers and high deductibles plans with
significant co-pays, as employers shift virtually the entire amount of cost
increases they experience from insurers onto workers. Since utilization of
services accounts for only one-quarter of healthcare cost increases, this
approach has not lowered costs. Higher prices account for three-fourths of cost
increases. The other mechanisms the ACA established to control costs – such as
“medical-loss ratio” requiring insurers to spend 80% of their premiums on care,
has not limited insurance rate increases. The individual mandate for people to
buy insurance did not create a younger, healthier, less expensive risk pool for
insurance companies. Shifting risk from insurance companies to providers and
hospitals through “pay for value, not volume” per capita payment reform, and by
creating Accountable Care Organizations (ACO’s), has restricted access to care
and created closed, narrow networks but has not lowered costs. Healthcare
Information Technology, especially Electronic Medical Records, has required
large capital expenditures and the latest research shows it has cost more than
it has saved.
4. The recent tax bill removed
the individual mandate from the ACA (Obamacare). How will that affect
healthcare in the U.S.?
Already, for the first time
since 2010, the number of uninsured Americans has increased, in part due to the
mandate’s demise. However, the impact will be mitigated by how ineffective the
mandate has proven to be in controlling costs. It is not the mandate that has
motivated people to buy coverage, it is the availability of subsidies for
purchasing coverage. Ironically, if the mandate removal means fewer healthy
people buying insurance – or buying it only when they need it – and premiums
rise, and subsidies go up, but pay for a smaller share of costs, it will cost
more to cover fewer people.
5. It seems like our
healthcare system isn’t working well for most Americans. Who actually benefits
from the system as it is now?
First, the top four US health
insurance companies who made $60 billion in profits between 2009-2015 during
the full implementation of the ACA, and the health insurance executives, who
take home between $20 million and $66 million per year.
It’s even better for the
prescription drug companies, whose profits continue to rise from the $125
billion reached in 2015. For-profit hospital corporations had achieved record
profits until the Trump Administration roll-backs, and in general hospitals
have had higher net income (profits) under the ACA – padding the jobs and
pockets of hospital administrators.
Wealthy Americans, and the
global elite, utilize the highly advanced treatments and technologies often
developed with tax dollars, offered in large academic and high-end private
medical centers.
In short, the 1% and the
healthcare industry are the primary beneficiaries of the present healthcare
system– some call it the “medical-industrial complex” – where money is the
metric of good medicine.
6. What is a single payer
system? And how would my life be different under a single payer healthcare
system?
The fundamental difference in
experience for people would be replacing health insecurity with the peace of
mind that comes from guaranteed healthcare. A single-payer system would
expand and improve the existing Medicare program for everyone in the
United States;
A single public program would
eliminate insurance company premiums, deductibles and co-pays and establish
fair and equitable public financing;
Patients would have the right
to culturally competent care, and complete choice of their healthcare
providers;
All medically necessary
services, including doctor visits, reproductive healthcare, hospitalization,
preventive care, long-term care, mental health, dental, vision, medical
supplies, prescription drugs and assisted living services needed by aged and
disabled people;
It would relieve businesses of
the burdens of administrating health benefits, end escalating costs that
subsidize insurance company profits, creating resources for wages, pensions,
innovation and growth;
Medicare for All would
establish a single standard of safe, therapeutic care and fund a robust
community and public health system to address health disparities, and enable
the professional clinical judgment of doctors and nurses to be the basis of
healthcare decisions (no more claims denials!).
7. Insurance can feel more
like a privilege rather than a right. I pay for it, but I don’t want to have to
pay for others too. Why should we expand the system to cover everyone?
Everyone with insurance
already pays for others, since but we all pay too much for healthcare. Rather
than our health being something we buy and sell as a insurance risk, which can
never predict what we will actually need, and depends upon huge tax subsidies,
we need a health system that will be there when we need it, regardless of
ability to pay. We cover everybody because if we do not, we will end up
spending more, and suffer from poorer health, individually through unchecked
communicable disease, and collectively through worse public health.
8. I’ve heard a lot of horror
stories on the media about wait times in countries that have single payer
healthcare. Would that be an issue if we implemented it here?
No – Medicare beneficiaries
who receive care in the system we will improve and expand do not have excessive
wait times. Most people with commercial insurance wait weeks to see a
specialist in the US. In fact, for those who are uninsured or cannot afford
their deductible have the ultimate wait time: postponed or no care at all.
9. A lot of progressives are
talking about a “Medicare for All” system, but not everyone has a good
experience on Medicare. If we expanded Medicare to the entire system would we
address those issues? And how?
If we listen to the stories of
people on Medicare now, we learn that it provides real health security,
contains costs much better than other payers, has much lower administrative
costs, and enjoys broad public support - Medicare is popular and it works. Of
course, Medicare is not perfect, operating as it does in the system dominated
by the commercial insurers, and being privatized itself in Parts B
(supplemental coverage), Part C (Medicare Advantage), and the drug benefit
under Part D.Those privatized products have created tiers of coverage, and
inequitable standards of care and access to providers. We must improve it by
among other things expanding the benefits to include dental and vision, and
eliminate all the co-pays and deductibles seniors now pay.
10. Covering all Americans
sounds like it would cost a lot of money. How would we pay for single payer
healthcare?
Improved Medicare for All
would eliminate health insurance industry profits, marketing costs, and
administrative waste and allow for the negotiation of drug prices and medical
fees, saving nearly $500 billion annually. This is enough is enough to cover
all of the uninsured and eliminate the out-of-pocket expenses for us that act
as barriers to care.
There are many options
available on how to finance a Medicare for All system that will save low and
middle-income families a significant portion of their annual income. These
include a tax on the top 5 percent, as it creates savings for 95 percent of
Americans, increase the current Medicare program excise tax on payroll and
self-employment income, and institute a modest tax on unearned income and on
speculative financial transactions.
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