The best outcome of all of this is that tons of businesses would get out of the third-party business of providing themselves as a go-between between their employees and their health insurance. The only problem is that a bunch of idiot employees will probably just take the money and spend it on lottery tickets!!! ha ha ha ha

Real Patients’ Rights Be very afraid of McCain-Kennedy.

By Grace-Marie Turner, president of the Galen Institute, a not-for-profit research organization based in Alexandria, Va., that focuses on free-market health reform June 28, 2001 9:30 a.m. Printer-Friendly

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eadlines across the country are celebrating victories on key Senate votes for "patients' rights," especially one to make sure employers will be liable in court for decisions they may make involving health coverage for their workers.

While this may be a victory for Washington politicians, it is a huge defeat for insured — and uninsured — workers.

The New York Times proclaims, "Patients' rights pick up momentum" and the Washington Post says, "Health care bill clears big hurdle in Senate." The stories describe votes on employer liability, which has emerged as a central issue in the debate over the McCain-Kennedy "Bipartisan Patient Protection Act."

At issue is an amendment offered by Phil Gramm (R., Tex.) to adopt the clear exemption for employers found in the Texas Health Care Liability Act, which often is touted as a model for employer protection. The Senate yesterday defeated the Gramm amendment 57-43, with six Republicans and Sen. Jim Jeffords joining all 50 Democrats.

"What is going to happen is that, all over America, small businesses are going to call in their employees and say, 'I want to provide you benefits but I cannot risk the business my father, my mother, my family have invested their heart and soul in and, therefore, I'm going to have to cancel your health insurance,' " Sen. Gramm said.

So what does the other side say? Sen. Kennedy railed against "unscrupulous employers," saying, "The worst employers [would have] an economic incentive to cut corners on employee health care and free them from all accountability when they do so."

Sen. Kennedy clearly is stuck in Depression-era thinking. Employers want to provide health coverage for their workers, and the great majority of them do so voluntarily. But if this patients' bill of "rights" were to pass in its current form, employers would have little choice but to drop the coverage they sponsor.

They simply could not expose their entire businesses to the risk of a clever lawyer who could figure out a way to send the company into bankruptcy over a decision involving one disgruntled employee's health care.

Employers instead would most likely cash out the amount they have been spending on health coverage and provide it to their workers to make other arrangements.

This is not a bad idea, actually, and one that is evolving in the employment community right now. Two major conferences were held this month — one in Washington and another in Chicago — to explore the idea of giving employees more choice and control over their health coverage through "defined contributions."

But the McCain-Kennedy bill is not the way to facilitate this change. The change needs to evolve, giving the marketplace a chance to reorganize around empowered consumers, and giving employees time to get accustomed to the change. McCain-Kennedy would be like using an ax in the operating room when a scalpel is clearly needed.

In fact, defeat of the Gramm amendment is a death-knell for the Senate version of this bill. A more business-friendly House bill was just unveiled with the support of the House leadership and key committee chairmen, and President Bush has vowed to veto any bill that so damages the current system.

Those claiming to be on the side of patients are recklessly disregarding the impact of the Senate's action on real people. A column by Michael Kinsley in the Washington Post last week provided evidence that perhaps the PBOR debate has turned a corner: This self-described liberal wonders why there isn't a greater outcry about this "massive new regulatory system imposed on one of the country's biggest industries" that "actually thumbs its nose at what is obviously the biggest gap in the social safety net: the millions of people with no health insurance at all."

Other columnists around the country are echoing similar sentiments.

Ellen Goodman in the Boston Globe says a foreigner plopped into the debate over the patients' bill of rights "would believe that we all sit around waiting for an appendix to burst or a malignancy to spread, hoping that we will be denied a specialist or an experimental treatment so we — or probably our heirs — could sue the bejesus out of our insurer."

"But there's a waitress out there who can't afford a mammogram and a maintenance worker who can't afford prostate screening, and neither of them has an insurer, let alone a lobbyist. Their great American dream is not, I promise you, finding someone to sue," Goodman concludes.

Any of the so-called patients' rights bills will drive up costs, cause millions to lose their health insurance, force more private physicians into group practices, and spend more health-care dollars on lawyers.

Why do consumers need an act of Congress to make the market more responsive? This is America! People are used to getting what they want, when they want it, for the price they're willing to pay — but not in the health sector.

The solution, however, is not to create a bureaucratic maze of impossibly complex legislation and lawsuits. Instead, we should have a system in which people can choose the health plans that suit their needs, plans they have bought directly or through groups negotiating in their best interest.

Of course, people should be able to sue their health plans, but lawsuits should be their last resort. First, they should be able to vote with their feet and select a plan that caters to their needs. Then, if they are denied care, they could take their health plans to court for breach of contract just as they would under any other contract arrangements.

Why can't they do that now?

Because they don't own their health-insurance policies and therefore have little recourse in either the marketplace or in the courts. Most Americans get their health insurance as a benefit through their jobs because tax law makes this arrangement so attractive. But this also means that the employer owns the health-insurance policy and decides the terms.

Whoever controls the money controls the choices. If it is employers, they will pick the health plan and decide the terms. If it is government, it will create tens of thousands of pages of regulation to govern the spending of every penny.

The long-term solution is for people to select and own their own health insurance, picking a policy that best suits them, just as they do every day in purchasing life, home, and car insurance. Competition will force health plans and insurance companies to respond to the demands of their customers for high-quality, affordable coverage.

A number of initiatives being considered in Congress would help consumers get their own private health insurance by directing refundable tax credits to individuals. This option also would begin to revitalize the fragile and shrinking market for private health insurance.

The real cure will be a health-care system in which people make their own decisions about the health coverage they want, coverage they can take with them if they move, change jobs, retire, or start their own businesses.

This would be a giant step in the right direction toward a responsive free market for health insurance — one in which health-care dollars go to medical care, not lawsuits.

-- (health.care@.the.masses), June 28, 2001

Answers

"Sen. Kennedy railed against 'unscrupulous employers,'"

This guy has got to be a bigger ass than his own ass.

-- Edward (the@big.fat.slob), June 28, 2001.

“Of all the forms of inequality, injustice in health care is the most shocking and inhumane.” - Martin Luther King, Jr.

"Rats and roaches live by competition under the laws of supply and demand. It is the privilege of human beings to live under the laws of justice and mercy." - Wendell Berry

Why the U.S. Needs a Single Payer Health System

David U. Himmelstein, M.D. & Steffie Woolhandler, M.D.

1. Our pluralistic health care system is giving way to a system run by corporate oligopolies. A single payer reform provides the only realistic alternative.

A few giant firms own or control a growing share of medical practice. The winners in the new medical marketplace are determined by financial clout, not medical quality. The result: three or four hospital chains and managed care plans will soon corner the market, leaving physicians and patients with few options. Doctors who don't fit in with corporate needs will be shut out, regardless of patient needs.

A single firm - Columbia/HCA - now owns one quarter of all Florida hospitals, and has announced plans to move into Massachusetts. In the past year alone the firm has purchased more than a dozen hospitals in Denver and Chicago, closing unprofitable ones and shutting out unprofitable physicians and patients.

In Minnesota, the most mature managed care market, only three or four plans and three or four hospital chains are left. In many rural areas a single plan dominates the market, presenting patients and physicians with a take it or leave-it choice.

Managed care plans in California, Texas and Washington, DC have "delisted" thousands of physicians - both primary care doctors and specialists - based solely on economic criteria. One Texas physician was featured in Aetna's newsletter as "Primary Care Physician of the Month", and thrown out of the plan shortly thereafter when he accumulated high cost patients in his practice. In Massachusetts, BayState HMO "delisted" hundreds of psychiatrists, instructing their patients to call an 800 number to be assigned a new mental health provider. The for-profit firm running Medicaid's managed mental health care plan has just informed psychiatrists that many of them will be barred from the plan as a cost cutting measure.

HMOs are racing to take over Medicare, despite evidence that HMOs have actually increased Medicare costs. The managed care plans sign up mainly the healthy elderly, often illegally inquiring about their health history. The physician contracts offered by plans such as Secure Horizons/Tufts virtually exclude small practices as well as academic physicians who practice less than full time. Financial incentives that penalize the primary care physician for every specialty referral, diagnostic test, and hospital visit pit patients against doctors, and specialists against primary care physicians.

HMOs/insurers that can raise massive amounts of capital by selling stock have a decisive advantage. Their deep pockets allow them to mount massive ad campaigns, market nationally to large employers, and set premiums below costs until competitors are driven out. Once they've cornered the market they can drive hard bargains with hospitals and doctors. As a result not-for-profit plans across the country are going for-profit (even Blue Cross), and small plans are being taken over. Even the largest physician-owned plans cannot compete with U.S. Healthcare, Prudential and similar firms with multi- billion dollar war chests.

Large drug firms are preparing to directly take over much of specialty care. Merck, Lilly and others are developing "Disease Management" subsidiaries to sub contract with HMOs to care for patients with expensive chronic diseases such as depression, diabetes, asthma and cancer.

2. A single payer system would save on bureaucracy and investor profits, making more funds available for care.

Private insurers take, on average, 13% of premium dollars for overhead and profit. Overhead/profits are even higher, about 30%, in big managed care plans like U.S. Healthcare. In contrast, overhead consumes less than 2% of funds in the fee-for-service Medicare program, and less than 1% in Canada's program.

Blue Cross in Massachusetts employs more people to administer coverage for about 2.5 million New Englanders than are employed in all of Canada to administer single payer coverage for 27 million Canadians.

In Massachusetts, hospitals spend 25.5% of their revenues on billing and administration. The average Canadian hospital spends less than half as much, because the single payer system obviates the need to determine patient eligibility for services, obtain prior approval, attribute costs and charges to individual patients, and battle with insurers over care and payment.

Physicians in the U.S. face massive bureaucratic costs. The average office-based American doctor employs 1.5 clerical and managerial staff, spends 44% of gross income on overhead, and devotes 134 hours of his/her own time annually to billing2. Canadian physicians employ 0.7 clerical/administrative staff, spend 34% of their gross income for overhead, and trivial amounts of time on billing2 (there's a single half page form for all patients, or a simple electronic system). According to U.S. Congress' General Accounting Office, administrative savings from a single payer reform would total about 10% of overall health spending. These administrative savings, about $100 billion annually, are enough to cover all of the uninsured, and virtually eliminate co-payments, deductibles and exclusions for those who now have inadequate plans - without any increase in total health spending.

3. The current market-driven system is increasingly compromising quality and access to care.

The number of uninsured has risen rapidly, to 39.7 million nationally [update: This figure is now over 42 million!]. The proportion of people with coverage paid by an employer is dropping, and those with employer-paid coverage face rising out-of-pocket costs. Only massive Medicaid expansions - 10.5 million nationally since 1989 - have averted a much larger increase in the uninsured. Proposals for welfare reform and Medicaid managed care programs would shrink Medicaid enrollment (increasing the number of uninsured) and threaten the quality of care for those left on Medicaid.

U.S. Healthcare and other investor-owned managed care plans are inserting "gag" clauses in physicians' contracts. Our own U.S. Healthcare contracts forbid physicians to "take any action or make any communication which undermines or could undermine the confidence of enrollees, potential enrollees, their employers, their unions, or the public in U.S. Healthcare or the quality of U.S. Healthcare coverage" and forbids any disclosure of the terms of the contract. Meanwhile, Leonard Abramson, U.S. Healthcare's CEO, took home $20 million in a single year, and holds company stock valued at $782 million.

Insurers are gutting mental health benefits, denying needed care, cutting payment rates, and insisting on the cheapest - and often not the best - form of therapy.

HMOs have sought to profit from Medicare and Medicaid contracts by providing substandard care, and even perpetrating massive fraud. The largest Medicare HMO, IMC in Florida, induced thousands of the elderly to sign over their Medicare eligibility and then absconded with $200 million in federal funds. Nationwide, Medicare HMOs provide strikingly substandard homecare and rehabilitation to the disabled elderly. Tennessee Medicaid HMOs have failed to pay doctors and hospitals for care.

After 360,000 women and children were enrolled (and $650 million was spent annually), Florida suspended enrollment in its Medicaid HMO program because of flagrant abuses. Administrative costs consumed more than 50% of Medicaid spending in at least 4 Florida HMOs. In one plan that enrolled 48,000 Medicaid recipients, 19% of total Medicaid dollars went for the three owners' salaries. Thousands of patients were denied vital care; sales reps often illegally pressured healthy people into joining HMOs, while discouraging those who were ill; patient complaints, and inspectors' findings of substandard care were repeatedly ignored. Overall, a cursory state audit found serious problems at 21 of the 29 HMOs participating in the program. A more extensive evaluation is just beginning. These Florida scandals are a virtual replay of California's earlier Medicaid HMO experience.

HMO payment incentives increasingly pressure primary care physicians to avoid specialty consultations and diagnostic tests. In this coercive climate, errors of judgment will inevitably occur, denying patients needed specialty care, while specialists are idle. In some areas of the nation (eg. New York City and California) market imperatives have led to growing unemployment of physicians, while huge numbers of patients don't get adequate care.

Surveys show that patients greatly prefer care in the small-scale, non-institutional practices that are being wiped out in the current system.

4. A single payer system is better for patients and better for doctors. Canada spends $1000 less per capita on health care than the U.S., but delivers more care and greater choice for patients. Combining the single payer efficiency of Canada's system with the much higher funding of ours would yield better care than Canada's or ours at present.

Canadians patients have an unrestricted choice of doctors and hospitals, and Canadian doctors have a wider choice of practice options than U.S. physicians.

Canadians get more doctor visits and procedures, more hospital days, and even more bone marrow, liver and lung transplants than Americans.

While there are waits for a handful of expensive procedures, there is little or no wait for most kinds of care in Canada. An oft-cited survey that alleged huge waiting lists counted every patient with a future appointment as "in a queue." (The fringe group that conducted the survey also advocates the abolition of the licensing of physicians to open up free competition among "healers"). More legitimate research shows that the average waiting time for knee replacement in Ontario is 8 weeks, as compared to 3 weeks in the U.S. But patient satisfaction levels with the procedure and care are identical. The time from first suspicion to definitive therapy for breast cancer is actually shorter in British Columbia than in Washington State. There are virtually no waits for emergent coronary artery surgery in Canada, though elective cases face delays, particularly with the surgeons held in highest regard. Interestingly, though Canadian MI patients receive substantially fewer invasive diagnostic and therapeutic procedures, death and reinfarction rates are comparable in the two nations. Finally, under a single payer system we would face much less restraint on care than Canada because we spend (and would certainly continue to spend) much more, and have many more specialists and high tech facilities. Hence even the modest limitations on care seen in Canada are unlikely here.

Surgical outcomes for the elderly (all of whom are insured in the U.S.) are, on average, slightly better in Canada. Surveys show that Canadian doctors are far happier with their system than we are with ours. According to a 1992 poll, 85% prefer their system to ours; 83% rate the care in Canada as very good or excellent, and most physicians would urge their children to enter the profession. Fewer than 300 out of Canada's 50,000 physicians emigrate to the U.S. each year, and a survey of doctors who have practiced in both nations shows a clear preference for the Canadian system. Medicine has remained an extremely desirable profession; medical school admission is even more competitive in Canada than here.

Surveys show very high patient satisfaction in Canada. 96% prefer their system to ours, and 89% rate care good or excellent (up from 71% 4 years ago).

Canadian physicians' income are comparable, in most specialties, to those in the U.S., and have kept pace with inflation for the past 25 years.

It is perhaps comforting to know that Canada's highly regarded and efficiently managed health system is run by a government no more competent nor popular than our own. Their postal service and public railroad system generally receive lower marks than ours; their government's record on fiscal management is not better than ours; and polls show that Canadians distrust their government even more than we do.

Many of us have negative feelings toward government, and examples of government inefficiency and incompetence abound. Yet the record of private insurers is far worse. Their overhead is, on average, 600% above that of public programs, and no private insurer's overhead is as low as Medicare's. Dozens of financial scandals have wracked insurers and HMOs in the past year alone (our personal favorite is the $500,000 travel budget consumed by the head of one Blue Cross plan, including a $7000 junket to Africa to lecture on insurance fraud). Moreover, Medicare treats doctors and patients more respectfully than most private insurers, funds virtually all residency training, and pays Massachusetts hospitals higher rates than do most HMOs. Finally, when a public program misbehaves we have channels to seek redress; we know where Congress meets, and can vote them out. For-profit firms must answer only to their stockholders.

References 1. U.S. Healthcare 1994 Annual Report. 2. NEJM 1991; 324:1253. 3. NEJM 1993;329:400-3. 4.U.S. General Accounting Office. Canadian Health Care: Lessons for the U.S. 1991 5.Data from U.S. Census Bureau, Current Population Survey March Supplement. 6.U.S. Healthcare primary care physician contract 7. Modern Healthcare 5/1/95:60 8. Health Care Financing Review 1994;16:187 9.Fort Lauderdale Sun Sentinel. Florida's Medicaid HMOs: Profits from Paiin. 12/11-12/15, 1994 and State Health Watch April, 1995. 10. JAMA 1993;270:835 11. NEJM 1990;323:884 12. NEJM 1993;328:772 13.NEJM 1994;331:1063, Ann Int Med 1992;116:507, & OECD Health Database 14. Waiting Your Turn. Fraser Institute, 1994 15. NEJM 1994;331:1068 16. Medical Care 1993;34:264 17. Health Affairs 1991;10(3):110 18. NEJM 1993;328:779 19. Health Affairs, Summer 1992:61 20. Toronto Globe and Mail, 10/23/92 21. American J Public Health 1993;83:1544 22.Medical school application statistics from JAMA medical education issue, multiple years. 23. Toronto Star 9/13/93 24. NEJM 1990;322:562

-- Conservatives Encourage Americans to Become Like Rats and Roaches (Rats@roaches.com), June 28, 2001.

The problem with letting the government take over health care is it sucks at what it does. And further this prohibits competition in the marketplace. Canada does so well thanks to us. Canadians depend on the US for their pharmaceuticals. Canadian companies have figured out that it isn't worthwhile to do medical research, because the government has set limits on profits. So medical research has just about come to a grinding halt. Finding cures for diseases takes time; finding new and improved drugs which limit side effects takes time also. That's time and money. When a new drug is introduced into the US, it's estimated that it took 15 years of research. Well, guess what, someone needs to pay for that. It isn't the Canadian government who pays. As a matter of fact, they ask the US pharmaceuticals to provide the drugs to Canada for the same price as the old drugs. Well, if these companies say no, they look like the bad guys, just bad PR. So they give the drugs to Canada. Now, who do you think pays for that? That's right we do, in higher prices for the same drug. See what happens when the government gets into setting prices (it happened with CA utilities). Again if companies don't have an incentive (profits), they discontinue their services. If they are restricted in what they can charge for their products, they either find some other way to make up the lose or they go out of business.

-- Consumer (tail@wagging.the.dog), June 29, 2001.