Al Jazeera
November 7, 2009
the author is a U of Illinois researcher
The paradox of US healthcare By Andrew Kennis
For nearly two decades, Wendell Potter led a very comfortable life as a
public relations health insurance executive.
However, while flying on a corporate jet and being served lunch on
gold-rimmed china with gold-plated cutlery, Potter had an epiphany of sorts.
He realised that the reason why millions of Americans were without health
insurance or under-insured was because: "Our Wall Street-driven healthcare
system has created one of the most inequitable healthcare systems on the
planet."
This June, Potter left his well-paid and secure job at CIGMA, one of the
US's largest health insurance companies, and has spoken out in favour of
healthcare reform.
'Killing thousands'
With almost 50 million people living without any health insurance and
another 25 million people under-insured during a recession, the debate about
how
to reform the US healthcare system has been underway for many months in
Washington and is expected to continue through to the end of the year.
Since leaving CIGMA Potter become a whistleblower and is now speaking out
against industry abuses on national television news shows.
He does not mince words when telling Al Jazeera that if a strong "public
option" is not passed by Congress, healthcare executives would be effectively
allowed to continue policies that "literally kill thousands of Americans
every year, through denied coverage, as a result of relentless pressure
coming from Wall Street".
The public option, currently favoured by the White House, would attempt to
insure the uninsured, with the government providing a non-profit,
publicly-funded insurance plan.
The public option, however, has not been fully vetted and passed by
Congress and Republicans, coupled with a number of Democratic allies, have
vowed
to prevent it from reaching the desk of Barack Obama, the US president.
Paying more, getting less
In the meantime, the US continues to be the country with the highest
proportion of uninsured people in the developed world. It also has the
distinction of spending a greater portion of its total economic output on
healthcare
than any other developed country - just over 17 per cent of its gross
domestic product (GDP) last year.
On average, the US spends twice as much as other developed countries on
healthcare.
But even though US citizens pay more for healthcare, they get less of it,
resulting in a lowly 37th place ranking among healthcare systems in the
world, according to a study by the World Health Organization based on quality
and fairness.
In terms of the infant mortality rate, a common marker for the overall
state of healthcare systems, the US was outranked by all of the following
countries according to the CIA's World Factbook: Sweden (3rd), Japan (4th),
France (7th), Norway (10th), Germany (14th), Israel (17th), Denmark (21st),
United Kingdom (31st), Canada (35th), Taiwan (39th), Italy (41st) and even a
few underdeveloped countries, including Cuba (43rd).
How can this paradox of the US spending the most and getting the least for
its healthcare occur in the country with the world's largest economic
output?
Claudia Schaufan, an Argentine physician and professor of comparative
health policies at the University of California in Santa Cruz, explains that
the
common characteristics of healthcare systems in the developed world have
to do with the universality of coverage and the lack of for-profit entities.
The key behind each of these systems is that they all outperform the US in
terms of their infant mortality rates, administrative costs, the extent of
population with coverage and the proportion of GDP spent on healthcare.
Furthermore, there are no documented instances of citizens going bankrupt
because of medical care in these systems while, conversely, some studies
have shown as many as 700,000 Americans suffer that fate annually.
'Making a buck'
in depth
One grouping of healthcare systems can be described as socially insured
and multi-payer (Germany, Switzerland, Japan, Israel, Belgium and Austria),
another as socially insured and single-payer (Taiwan and Canada), and a
third as nationally insured and delivered (United Kingdom, Spain, all of
Scandinavia, Italy and Iceland).
Socially insured and multi-payer systems feature health insurance delivered
by non-profit insurers. Those who are unemployed or cannot afford to pay
for the insurance, receive governmental assistance so that universal
coverage is achieved.
Certain multi-payer countries have a wide choice of insurance programmes,
as is the case in Germany. When you choose a private, non-profit insurer -
Germany has 240 of them - the government pays a portion of the costs based
on your income.
Developed countries with one national insurer that is funded publicly -
often described as single-payer - have a healthcare system that is delivered
by either private (as is the case in Canada) or publicly-run institutions
(as is the case in all of Scandinavia).
While these systems differ in their specific characteristics, the
similarities are more important, according to Schaufan.
"Everyone has health insurance and there is no significant for-profit
aspect in any part of the medical sector ... nobody in these systems 'makes a
buck' at the expense of the health of patients," she says.
Learning from others
Taiwan, which spends three times less than the US on healthcare, developed
its current healthcare system in the mid-1990s, when the majority of
citizens were uninsured and policymakers collectively decided the health
system
needed to be radically overhauled. However, the Taiwanese looked to other
countries to forge their own system.
Asked what the proposed US reforms show in terms of learning from other
examples, Naoki Ikegami, a leading Japanese healthcare economics professor,
says simply: "Not much, because there has to be a willingness to learn and if
anything, US leaders have isolated themselves from learning about other
healthcare systems."
Professor Ikegami's co-author on numerous scholarly publications, John
Campbell, an American-born political science professor, says: "The reforms
being proposed in the US simply do not fix or get at the heart of the problem,
which is price containment and unsustainable healthcare costs.
"The US would stand to gain a lot from going to a single-payer system,
where costs could easily be contained and controlled."
Failing millions
In terms of for-profit and corporate healthcare interests influencing
policy in universally insured systems, however, the situation is quite
different.
Campbell says: "Insurance companies have a very small presence here in
Japan and simply do not influence policy at all. The exact opposite is the
case
in the US where they basically dictate policy."
Potter explains that the situation in the US is a far-cry from that in
Japan, as a result "of the lobbying strength of the for-profit, special
interests in this country".
Consequently, Potter describes current reforms being considered by Congress
as little more than "limited" in their scope.
Schaufan is also critical, adding that for most people, the measures being
debated in Washington will be little more than "mandates forcing people to
take on for-profit-based insurance companies, which already depend upon the
government to cleanse itself from having to cover the elderly and the
poor, through the popular Medicare and Medicaid programmes".
She believes the US should adopt more fundamental reforms putting it in
line with the rest of the developed world that has opted for universal
coverage within the scope of non-profit-based and administered systems.
Potter echoes Schaufan's sentiments: "The system has already failed
millions of Americans and will continue to fail millions more in the years to
come."
Other experts, however, disagree and point out that trying to rid the US of
its profit-based system is unrealistic.
Timothy Jost, a healthcare policy expert and law professor at Washington
and Lee University, says: "I would like to have world peace, but I just don't
think we're going to get rid of a for-profit healthcare system."
He says there are several significant steps Congress can take by passing
meaningful reforms, including "the expansion of Medicaid, as all reform bills
are currently proposing that Medicaid would be expanded to 133 per cent of
the poverty line".
Jost also points to "affordability subsidies, which would take care of a
sizable portion of the population and help put limits on cost-sharing, which
will cover most of the people who are under-insured".
Cost-sharing transfers much of the burden of paying for healthcare to
insured consumers and is a significant reason why many people are
under-insured
and many others have to declare medical bankruptcy, despite having
insurance.
What the public wants
Despite Jost's optimism about some of the reforms under consideration, the
public opinion polls suggest a possible disconnect between politicians and
the reforms they are proposing and what the public really wants from their
healthcare system.
Based on a recent New York Times/CBS News poll, the New York Times
reported that, "most Americans would be willing to pay higher taxes so
everyone
could have health insurance and said the government could do a better job of
holding down healthcare costs than the private sector".
Another recent ABC News/Washington Post poll documented public support for
governmental insurance going even farther, as 56 per cent supporting the
idea even if it meant running corporate insurers out of business.
What is even clearer than the apparent gulf that exists between public
opinion and the limited reforms being considered, however, is that the US
stands alone among other developed countries in terms of its profit-driven and
industry-dictated healthcare system.
Andrew Kennis is a PhD fellow, an investigative journalist, an adjunct
professor and a researcher in International and Political Communication. He is
receiving his PhD from the Institute of Communications Research at the
University of Illinois, Urbana-Champaign. As a journalist, he has written from
locations ranging across four continents, including Chiapas, Israel,
Venezuela, Taiwan, Guatemala, Quebec, Japan, Palestine and Mexico City
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