Physicians for A National Health Program’s Red Herring
The tireless Dr. Steffie Woolhandler, American champion for government monopoly, so-called “single-payer” has contributed a blog entry to a New York Times “Room for Debate” discussion on whether the U.S. should be more like Denmark (as suggested by Senator Bernie Sanders in the recent Democratic presidential candidates’ debate):
By the end of the 20th century, the U.S. was the lone hold out for private, for-profit health insurance, and its health statistics lagged behind dozens of countries. Meanwhile, costs soared to twice the average in other wealthy nations.
Other countries have seen huge savings by evicting private insurers and the reams of expensive paperwork they inflict on doctors and hospitals.
Obamacare will direct an additional $850 billion in public funds to private insurers, and boost insurance overhead by $273.6 billion.
One interesting thing about the fight against Obamacare is that the single-payer extremists and the free-market advocates agree that Obamacare is fundamentally unjust, in that it compels citizens to hand their money over to private health insurers.
The problem with the single-payer extremists’ approach is that it sees only two ways to finance health care: Government or private insurers. They are blind to the benefits of removing both third parties from most health spending, and allowing patients to control their own money. This is remarkable because we would never demand health–style insurance for housing or food, which are even more critical to sustaining life.
Single-payer extremists make a moral argument for their vision: Health care is a right, not a privilege, according to their worldview. However, their economic argument would pertain equally to housing. Suppose every time you had to change a light bulb, wash the windows, or clean your carpets, you had to go to an in-network provider and send a claim to your insurer? Premiums would be sky high and bureaucracy would run amok.
However, if the government had induced such a system, as it did for health insurance, we would be foolish to demand single-payer housing, driving everyone into government-rationed barracks!
And does Dr Woolhandler think that a government run single payer system would diminish the reams of paperwork and lunatic coding regulations? I think not.
PNHP swims with the red herrings.
Health insurance is NOT compulsory in Germany for those who earn over a certain salary.
Instead of a single payer system, why not move to a multi-payer system that relies on 116 million households to pay their own bills? Insurance could be reserved for rare events, with claims paid out under the insurance casualty model. Patients would decide where to seek care. Health plans could assist patients with decisions, like CalPERS does for joint replacement and cataracts. Preferred networks would be voluntary associations, where doctors agree to abide by network prices making it more easy for enrollees to seek care without price shocks.
The problem with the U.S. health care system is we have socialized the funding mechanism for care while keeping the provision of care a private, regulated market system. The example in the New York Times about the drug company repackaging OTC medications and charging $1,500 per month would only occur in a system where health plans are forced to pay claims for drugs ordered by doctors for patients who don’t care what their drugs cost.
John and Friends:
I really wish more of those who see through this single payer nonsense would take more time to outline the benefits of our private health insurance. Nr 1–it prevents the Federal government from acting like a monopsony, where it exercises ownership privileges through owning the gold. Also, we do not hear reminders that we already can see what can happen when the Feds are in charge; the VA is single payer, so is the Indian Health Service, and so on.
In the interest of adding to the debate, desp;ite the length of this piece, here is what I think about single payer:
THE LURE OF “SINGLE PAYER.” In the run-up to the election, Trump is sounding more Democrat than any other candidate by saying that “Everybody’s Got to be Covered, and the Government’s Gonna Pay For It.” Avik Roy, Forbes, 9/28/15. Of course, as a candidate, he doesn’t have to state how this could work; he just has to dangle something that many people believe already, that other countries with single payer plans are better off than we are in the US. They have bought the accusation that led to Obamacare, that “the US health system is broken and we have to fix it” Soon after reading this blog, a reporter said her editors were asking “If Obamacare is so bad, why don’t we just have single payer?” Here’s why not, in a tight list of 10 rational statements that we hope will partly counter-balance the romantic idea that single payer is just the ticket to get us out of this morass.
This is why not!
1. The government that has created the Obamacare mess will be the same government to create and manage the whole single payer game plan. That would give it the power to impose price controls, which automatically means control of wages and salaries—of 20% of the economy.
2. This same government has already demonstrated what happens when they manage healthcare services directly. Look at the VA, the Indian Health Service, the military, except for Walter Reed, and the public health hospitals created to serve the merchant marine. Look at the fact that Obmacare is managed by 65 different US agencies. The health system is so complex that there are no repositories of knowledge with enough wisdom to make sensible laws and regulations; each sub-agency writes what they want, then all is printed and imposed on an industry that does not know how to convince enough people that harm is being done. Currently, there is governmental denial of how its decisions are impacting healthcare, businesses and people.
3. Being the sole payer means that current payers—private health plans would go away, meaning that if the government program failed, there would be no one around to revive private coverage. Trump does not seem to understand thew difference between single payer and a market-based approach as he talks about “competititon.” after saying “the government will pay for it.”
4. Being a “monopsony” which is the buyer equivalent of “monopoly” as a seller, would give the government the power of ownership through its buying decisions: which hospitals and doctors could remain in business, which drugs would be approved, which procedures would be covered, which medical schools would be supported at how high a level, how many specialists of what kind would be authorized to receive government money, what staffing patterns would be required, and which religious/ethical rules would be in place everywhere. (“No abortions anywhere,” or “abortions everywhere”—no policy variations by state.
5. Many physicians would leave practice so as not to be subject to the kinds of rules that the government would insist on. Try Obamacare times 100. Not only would access to primary care decline, but so would access to cardiologists, orthopedists, neurosurgeons, and even rarer specialists with high incomes.
6. Corruption would set in, starting with efforts by groups of medical and health professionals to obtain “carve-outs” from the total program budget to go just to their specialties, so they could allocate it among themselves. If nurses are 1 third of hospital staffing costs, why not give them the money and let them recruit and staff up according to negotiated rules, not according to need. Look at all components of today’s healthcare system and imagine each of them making their own deals with susceptible agencies and legislators.
7. Amount of service would fall behind demand as political limits on the program’s budgets ignored the reality of what people actually needed. A budget that allowed for 100 open brain surgeries for epilepsy would cost X dollars. Too bad if the actual need were for 150.
8. The healthcare delivery system would become a “creature” of the Federal government, just as is the military. Governing boards would soon see that their authority and oversight roles had been taken away. No more Catholic hospitals, no more Baptist Hospitals, no more Jewish hospitals. This might be called “confiscation of assets without compensation.” That’s a fifth of our economy now being controlled by Washington, not the locus of a lot of IQ or honesty.
9. Declining reimbursement (because of a political inability to continue to raise taxes in the face of aging and increasing demand) would mean waves of hospital closures and closures of medical clinics, reducing capacity just as the demand caused by the idea that the federal program was “free” had increased demand. Innovation would stop. The stock market would find that venture capital dries up. The ripple effect would reach to NIH which would find that the research dollars it had invested in new science produced little return, as new work would not be authorized by the federal health plans’ rules.
10. Since Single Payer means payment by the Federal government, people would find that their personal and corporate taxes had increased, regardless of their income levels. Note that dollars would flow from local areas to the Federal government, only to be returned to the local areas where care is given, losing much of its purchasing power in the process.
Just as with Obamacare, incompetent management would produce a decline in access and quality of care, not only for the poor, but for everyone. Look to constant battles before the Supreme Court to squeeze benefits out of an unres-
ponsive administration. There would be few bragging rights on such a program.
AND:
It’s beyond naïve to say, “Just have everyone join Medicare.” as though that meant simplicity and lower admin costs. It is not part of our government’s culture to be “simple” and “cost-effective.” Look at the military-industrial complex. The Pentagon has not been audited—ever. Wastage is the order of the day. If we have a healthcare-industrial complex, these patterns will not be far behind. Once done, single payaer cannot be undone.
As for looking to Europe to see fine examples of single payer national health programs, remember that theirs were begun after World War II, (earlier for Germany.) because the existing health systems had been strained by the war And notice that all of them are adding private options for people willing to pay directly for good care even as they are being taxed for the national program.
Where do rich people from other countries go when they are seriously ill? The United States of America. It’s way past time that we gave credit to our health-care providers for the tremendous life-saving work they do every day.
{ When in the Air Force in France, I saw a 16th century hospital still in operation, used principally for plastic surgery, for patients from all over France. It was in a square with 100 beds on a side. Hotel Dieu in Paris is still in operation, after several hundred years. The US thinks a hospital is old if it has been in operation for 50 years. California forced the issue with hospitals built before 1973, to increase seismic safety. ]
That’s enough.
Wanda Jones
San Francisco
Wanda
Thanks for all your ideas which obviously you have spent a lot of time researching and thinking about
What I learned from your points is that single payer enthusiasts are unable to envision how their plan may play out
This a short sighted and dangerous view on such an important subject
Don Levit
Thanks Wanda for all your powerful observations.
Note a comment by Mark Steyn on the Hugh Hewitt show recently, comparing teh real Denmark to Bernie Sanders….
The Danes come by their big government honestly, in that they don’t just do it by piling up debt on your children and grandchildren. And the absolute dishonesty about how they’re going to pay for any of this stuff, how they’re going to pay for free college for illegal immigrants and all the other stuff they’re offering, whatever one feels about the Danes and the Swedes is they do figure out a way to pay for it. These guys just pile it up on our grandkids.
And yet, the appeal of something like Medicare for all is still very palpable. Between ages 60 and 65 I was constantly worried about medical bills and rising health insurance premiums. Since turning 65, I have had zero worries even when I did receive care, due to Medicare and an excellent MA plan for $29 a month. It feels rather selfish of me to deny the safety of Medicare to younger ages.
But here is the problem, I think. Medicare spends about $11,000 a person, and Medicare never really has to meet a budget. You can create a lot of security for $11,000 a year, nearly all of which comes from other taxpayers.
Medicare almost never says no to any kind of care or drug, and again you create a lot of security by never saying no.
The contrast of Medicare and Medicaid is very stark. State governments have to balance their budgets, more or less, and so Medicaid is constantly being chopped in terms of lower reimbursements and (in rare cases) saying to life-saving operations.
Bob–Thank you for your comments. I concur that medical security is very uneven, I just don’t see our country becoming competent in this area any time soon.
As for insurance as thew only solution, I recall the era when charity and bad debts could bsse a large part of a hospital budget, and whn doctors did not bill at all for poor patients. In theory, we should be wealthy enough to avoid having to depend on charity, but the wealth is unevenly disstributed. The left would have us take from the wealthy and give healthcare dollars to the poor. The right would have the poor earn it or go without or depend on charity. The middle of the road person would have healthcare continually evolve new solutions that fit what the people can afford, as with nurse clinics in pharmacies. What we should not do is treat this problem as a religious or political debate, ignoring the practical delivery demands and actual dollar flows needed by major groups.
Cheers to all…
Wanda Jones