Hidden costs of US health care


In my previous posts following on the film Sicko (Haven’t seen the film yet? It is well worth it.) I have been focusing on the tangible costs and benefits of the US health care system compared to those of other developed countries, and showing why the US system comes out badly in comparison. The chief culprit is the insertion of profit-making private health insurance companies between the patient and health care providers, creating an immediate trade-off between profit and providing care that is detrimental to the latter.

But there are several intangibles that are also important. The main one is that having one’s health insurance tied to one’s place of employment highly distorts the basis on which people make important life decisions. Right now, many people make decisions of what job to take and where to live based on the health care provided by employers. People with families and young children are especially caught in a bind. Some people spend their entire lives in dead-end jobs that they hate, trapped because of the fact that they cannot afford to leave and lose the health benefits. This is especially so if they or a member of their family has a health problem that becomes a non-covered ‘pre-existing condition’ in their new workplace, and thus denied coverage, at least for a limited time.

What is the cost of this? For one thing, it discourages entrepreneurs and freelancers. A person who wants to quit his or her job to start their own business or implement an innovative idea is strongly discouraged from doing so, especially if they have families. Not only is the cost of purchasing private insurance for themselves prohibitive, so is the cost for providing it for their employees. In 2004, the average cost of health insurance for family coverage was $9,950, which means that it is likely to be around $12,000 in 2007. This is close to the amount earned annually by a full-time minimum wage worker. How many business ideas have never seen the light of day, how many jobs never created, because potential innovators just could not bring themselves to risk the health of their families by leaving their jobs?

Health insurance tied to businesses also discourages the creative arts. Painters, writers, sculptors, poets, actors, dancers, and musicians are people who add enormously to the quality of life of a community. A community that has a vibrant arts community is one that is lively and healthy. Most artists do not go into it for the money (although they have dreams of their work becoming widely recognized someday) but because they really love what they do and are willing to suffer some hardship for it. They are willing to forego luxuries and live fairly Spartan lives with respect to housing, food, clothing and the like, just to have the opportunity to create art. Many are willing to take part-time jobs to cover life’s essentials so that they have the time and freedom to devote to their passion. But the biggest single expense for such people is the cost of buying health insurance as private individuals. Many simply do not do so, gambling that they will not get very sick.

Then we have young people, straight out of high school or college who may want to experience a carefree life for at least a short time before settling down, and maybe travel around this vast country doing various jobs, seeing new things, meeting new people, and learning about the various communities they pass through. Maybe they want to work in underprivileged areas. Right now, the only way to safely do that is to do it through an organization that provides health insurance. If they go on their own, they have to buy expensive private health insurance or take the risk that they will not need health care. Even for the volunteer organizations that provide health insurance, providing it is a big headache and expense.

Then there is the problem of transitioning between jobs and between school and jobs. There are often gaps between the times when students leave college and start their first jobs. Because they have left school, they no longer are covered by their family or school health insurance policies. They have to shop around for some coverage for the transition period until they get their first job. People who have a gap when they move from one job to another can sometimes use COBRA coverage during the transition.

Even people who like their jobs and have health insurance plans to choose from (the so called ‘lucky ones’) face all kinds of irritations. The family may select an insurance plan and from it choose pediatricians for their children, an internist for the parents and a gynecologist for the mother, all within that one plan. The next year, they are likely to find that some of the physicians are now on different plans. So you have to repeat the process of comparing health care plans, weighing the costs and benefits, comparing physician lists, and trying to figure out who and what to keep and to jettison. This has to be done every year. And then you have to keep track of all the paperwork and receipts and co-payments. I think people have got so beaten down that they simply do not realize how much time goes into taking care of all these details. It is only when they get drawn into the bureaucratic nightmare that results when coverage is denied or some major illness strikes that they realize what a crazy system they are in.

Why have people in the US become so numb and accepting of this state of affairs? In surveying the responses to the film Sicko, James Clay Fuller makes a good point:

Not one mentions the comments by Tony Benn, a former member of Britain’s Parliament. Yet Benn’s statements probably are the most profound element of the film.

He notes, as other good people often do, that “if we have the money to kill (in war), we’ve got the money to help people.”

But, more importantly, Benn tells Moore, that all of Europe and many other places have good health care systems while the United States lacks such a basic service because in Europe and elsewhere, “the politicians are afraid of the people” when the people get angry and demand some action. In the United States, he observes, “the people are afraid of those in power” because they fear losing their jobs, fear being cut off from health care or other services if they speak up and make demands.

“How do you control people?” Benn asks, and he answers: “Through fear and debt.”

His point is that in the United States we have a great overabundance of both.

When are people going to get angry enough to say “We’re mad as hell and we’re not going to take it anymore”?

POST SCRIPT: The invertebrate Congress

On Bill Moyers’ show, Conservative Bruce Fein argues why Bush should be impeached and criticizes a spineless Congress for not doing so, and John Nichols (author of the book The Genius of Impeachment) agrees.

Here is a transcript.

Another conservative Paul Craig Roberts (Assistant Secretary of the Treasury in the Reagan administration and former Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review) has also called for the immediate impeachment of both Bush and Cheney.

The idea of impeachment was inserted into the US constitution as a vital check against the president assuming dictatorial powers akin to those of a king. It was almost tailor-made to deal with situations like that which currently exists. But the Democratic Party leadership seems unwilling to do this.


(Please see here for previous posts in this series.)













POST SCRIPT: Why a secular public sphere works best



Steve Benen provides some background on what happened.



Evolution-9: Early challenges to Darwin’s theory

(Please see here for previous posts in this series.)
















POST SCRIPT: Science? Evidence? Who cares?




Chertoff would be well-advised to follow Sagan’s advice.

How universal single-payer systems protect us against catastrophes


I think almost everyone across the political spectrum would concede the fact that the fifty million Americans currently without health insurance would definitely benefit from the adoption of a universal, government-run, single-payer health care system. The reason that it has not been adopted is that many of the remaining 250 million have been frightened into thinking that their medical coverage would decline from what they have now.

This feeling that “The present system works for me so why tinker with it?” is based on the assumption that our lives are stable and that things will continue just as they are into the foreseeable future. I am not so sanguine about this, perhaps because I am older and have repeatedly seen and experienced how the slings and arrows of outrageous fortune can strike anyone at any time and dramatically change lives. As a result I think it unwise to base our policy decisions on the rosy assumption that what is true for me now will continue to be true for me tomorrow. All it takes is a single catastrophe that causes the loss of our job, which could happen to any of us at any time, and all our comfortable assumptions about the future can end up in the trash can.

It is not uncommon for people who are incapacitated by an illness or an accident to themselves or someone in their family to lose their jobs and not be able to get another one with health benefits. As a result, such families are faced with stark choices: suffer or die for lack or treatment or have the family risk bankruptcy paying for it.

US News & World Report summarized the findings of a study that looked at a representative sample of bankruptcies across the country:

We have health insurance for several reasons, but one of the big ones is to protect us from high medical bills when we get sick. But insurance, it turns out, may not be the protection that many people think it is. Illness and medical bills are big reasons behind fully half of all personal bankruptcies, affecting about 700,000 households per year, according to a new study. And most of those households had insurance.
. . .
These were working- class or middle-class people, and 76 percent of them had health insurance when they first got sick. (Many lost this coverage because the insurance was through their jobs, so it disappeared when they couldn’t work.) Half of the bankruptcies were caused, in part, by illness and medical debt. Their median debt was about $16,500, and the major part of that debt was payments to doctors and hospitals. Families initially tried to pay the debt for several months, says Elizabeth Warren, a bankruptcy expert at Harvard Law School. Sixty-one percent went without needed medical care to make payments, 30 percent had a utility shut off, and 22 percent cut back on their food.

If you simply ask around, you will find many examples of people who have been forced to make drastic decisions because of their health care situation. A couple I know moved to Mexico because they could not afford to pay for their health care here.

But even if people are willing to shut out from their minds the possible of such an unfortunate turn of events happening to them personally (and human beings are very skilled at avoiding thinking about such things), surely they would like to feel that their families and children and grandchildren and great-grandchildren will not have to suffer? The odds are very high that several people in each one of our extended families will face a health-related crisis in their lives that will threaten to send them into destitution. Even if we are blasé about ill health striking total strangers, surely we cannot be so complacent about our own descendents?

David U. Himmelstein, MD and Steffie Woolhandler, MD provide a detailed case (scroll down) for “Why the US Needs a Single-Payer Health System” outlining the toll the present system in the US takes on both patients and health care professionals, and the increasing monopolization of the system by a few giant corporations. They describe the huge amounts of paperwork that doctors in the US have to do because of the complicated and cumbersome health insurance system here. They have to employ a number of clerical staff simply to process the different paperwork with all the different insurance companies and then haggle with them over payment and treatment. In addition, the health insurance companies have to negotiate contracts with different companies in different states with different laws and regulations. As a result, “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.”

Perhaps we should start by providing single payer health care coverage to all children. Children are not responsible for their lot in society and should not be deprived of basic needs of food or shelter or clothing or education or health care.

There was a very sad story in the film Sicko. (Although I keep talking about the sad stories in it, I should emphasize that Sicko is also a very funny film.) It was about a little girl who was taken to a hospital emergency room with very high fever. They refused to provide treatment because she was not ‘entitled’ to be treated there, and insisted that she be transferred to a hospital across town, the place where she was ‘supposed’ to go to. She died during the time that she was transferred from one hospital emergency room to another.

To be denied treatment for purely bureaucratic reasons is unconscionable. It puts the health care professionals also in an impossible situation. If the emergency room physicians and nurses at the first hospital had realized that the child had a life-threatening condition, I am certain that their natural humanity would have taken over and they would have treated the child irrespective of whether she qualified or not. But if they had treated the child and it was something that could have waited, they might have been reprimanded for providing treatment to an ‘unauthorized’ patient. Why should health care professionals have to be put into making such kinds of bureaucratic decisions instead of doing what they are trained to do, which is simply treating the patient in front of them as best as they can?


POST SCRIPT: Where’s Freud when you need him?

Comedian Craig Kilborn gets a laugh out of our ability to see sex symbolism everywhere .

Evolution-8: The sufficiency of the mutation rate

(Please see here for previous posts in this series.)










Seems like a long shot?










POST SCRIPT: Michael Moore blasts CNN and Wolf Blitzer


Moore followed up with a detailed analysis of Gupta’s shallow reporting.

Time for ‘socialized’ medicine in the US?

(For previous posts on Sicko and the merits of a government-run, universal, single payer health care system, see here and here.)

Michael Moore’s excellent film Sicko has cinematically exposed the deep flaws of the US health system. His film scarcely touches on the awful plight of the 50 million people who have no insurance at all. That would have been bad enough but instead he sought to highlight the plight of those who do have health insurance and think they are secure, but discover to their horror that their insurance companies let them down in their moments of greatest need.

He emphasizes the fact that when you introduce profit-making entities in between the patient and the health care providers, you have guaranteed that attempts will be made to deny health care as much as possible. The insurance companies actually have employees whose task is to dig deep into your past to see if they can find anything, anything at all, that would enable them to invoke the fine print in their policies and deny coverage. Hence many people receive nasty shocks that they are not covered just as they are reeling from the discovery that they have a serious illness.

And this is why in the US you have a system in which the minority who are rich and powerful and influential have access to very good health care because they are in a position to create trouble for the insurance companies, while the vast majority are vulnerable to finding out that getting ill can mean ruin.

One of the curious things about the health care debate in the US is that the opponents of a government-run, single payer, universal health care system try to portray it as this mysterious, unknown, complicated, untried, massively bureaucratic, expensive system that one should not experiment with.

This is ridiculous. It is the system in the US that is mysterious, complicated, massively bureaucratic, and expensive. Government-run, universal, single payer systems are the norm in the developed world and in many countries of the third world. There are any number of working models that have been in existence for over half a century for which cost-benefit analyses exist and the operating structures are well known. It is the US, almost in isolation, that has a bizarre, labyrinthine, bureaucratic, and expensive system.

The basic concept of how single payer health care works is very easy to understand as this wonderful little animation illustrates. What is needed is to select the model that might adapt best to the US and modify it to meet our needs. The only difficulty to doing that would be to combat the vested interests of the health insurance and drug interests who will fight tooth and nail to keep making massive profits off the sickness of people.

Even magazines like BusinessWeek concede that the French system is superior to the US:

. . .

There will still be some bureaucracy because it will be needed to do all the paperwork to run the health care system. But the point is that this bureaucracy is invisible to the patients. As far as the patient is concerned, you go to the doctor and you get treated. That’s it. You do not have to fill in any forms. The paperwork goes on behind the scenes between the government, the drug companies, hospitals, and the health professionals. Even for the doctors the paperwork is simplified because they are now dealing with just a single payer of their services and don’t have to keep track of multiple health insurance companies, each of which has different rules for what they can and cannot do. This is why the entire health system in Canada has fewer workers (scroll down) to serve its population of 27 million than Blue Cross requires to service less than one-tenth that population in New England alone.

But while the surface debate is about policy, the deeper debate is about a fundamental difference in philosophy

At one extreme, there are those who take the view that it is up to each one of us to look after our own interests and feel perfectly comfortable ignoring the needs of others. Such people take the point of view that each person is responsible for their health care. The ‘free market’ should operate and people should shop around for what works for them. If they do not have the means to do so, then that is their own fault or their own tough luck. They have failed to provide for themselves and cannot expect the rest of society to look after them, except for what private charities might provide.

At the other end (which is where I am) are those who feel that when it comes to basic issues like health care, it is the responsibility of every one to look after everyone else. Decent health care is not a commodity like toothpaste to be bought and sold on the market. It is a fundamental right that everyone (especially children and the elderly) is entitled to, irrespective of their ability to pay, and should be seen as a collective social obligation. Most such systems are based on spreading risk over a large number of people and because of that principle, while there are options for people to buy supplemental insurance on the private market, there cannot be an opt out provision, just as there is no opt out for police or fire systems or trash collection or libraries or parks or all the other similar collective systems that we currently have in place.

Those who oppose single payer health care systems try to frighten people with all kinds of bogeymen. The extent to which they are willing to go sometimes reaches levels of downright lunacy. In the wake of the release of Sicko, some have even said, if you can believe it, that adopting a single payer system could result in more terrorism! There are no depths of fear-mongering to which they will not sink.

But the tried and true standby to try and frighten people is the charge that single payer systems equate to ‘socialized medicine’, as if that is an automatic disqualifier.

It is a tribute to the success of the propaganda model that simply the word ‘socialism’ strikes such fear in so many people in the US. But the fact is that the word is ill-defined in this context. There are some health care systems where the hospitals are actually run by the government, and the health care professionals are government employees. This is perhaps closest to what might be meant by ‘socialized medicine’ and is close to what England has with its National Health Service. Then there is the French system where things are a mix of public and private, and the government mainly acts as the sole entity financing the system, collecting money in the form of taxes and using that to pay for services.

If the scaremongers want to invoke the word ‘socialized’ so broadly as to mean the spreading of the risk across the whole population, then that is no strange concept to the US because then socialism is already rampant in the US.

Sometimes US ‘socialism’ occurs a highly distorted form, where the risks are spread around to everyone but the benefits accrue to a wealthy few. Consider for example the FDIC insurance that banks carry. Every person is underwriting that insurance through our taxes, but it benefits the banks and those who have money to deposit. The past US government bailouts of the auto and airline industries when they were in trouble are examples where the costs and risks are borne by all of us, but the benefits accrued to a select few. The savings and loan debacle of the 1980s was again an instance of the risks and costs being ‘socialized’ (i.e., spread over the entire population), irrespective of whether people had money in the savings and loans institutions or not.

The better form of ‘socialized’ services is where everyone pays for services and everyone also benefits, such as is currently the case in the US with ‘socialized’ fire departments, ‘socialized’ police departments, ‘socialized’ parks, ‘socialized’ libraries, ‘socialized’ trash collection, ‘socialized’ hurricane and weather forecasting, ‘socialized’ air traffic control, ‘socialized’ roads, the list goes on endlessly. All these function on the assumption that there are certain things which are a collective good, and that we all should contribute to their maintenance so that we benefit as needed. ‘Socialized’ medicine should be seen as a natural addition to such existing ‘socialized’ public services, not some strange alien concept.

No health system is perfect. There will always be people who suffer and die because of the lack of equipment or drugs or incompetence. But no one should suffer and die because of the lack of ability to pay or because of bureaucratic hurdles erected in their path in order that some people can make a profit.

In the next post in this series on Thursday, I will look at the “But I’m ok, aren’t I?” attitude that opposes change in the health care system because the speaker thinks that he or she is secure now.

POST SCRIPT: Health care industry contributions to candidates

Michael Moore is helping us keep tabs on how the health care industry is contributing money to presidential candidates of both parties.

Of course, the industry is doing this purely out of a sense of public service and for the sake of supporting democracy, and not to bribe the candidates to make sure that a government run, single payer, health care system is never seriously considered, whoever happens to win.

Evolution-7: Genes, chromosomes, and DNA

(Please see here for previous posts in this series.)











Next in this series: The sufficiency of the mutation rate

POST SCRIPT: Impeachment



Discussing health care seriously

In my discussions with people on serious and controversial topics, I have some simple rules of thumb to tell me tell whether the discussion is worth pursuing or whether the other person is not serious and talking further is a waste of time.

For example, when discussing evolution, as soon as someone says something along the lines of Mel Gibson’s “If we descended from monkeys, then how come there are still monkeys? How come apes aren’t people yet?” then you know that you are dealing with someone who is either being willfully dishonest or is so ignorant of the basic facts of the topic under discussion that it is not worth continuing unless one is willing to spend a lot of time to bring that person up to speed. The wrongful use of the second law of thermodynamics is another example of a warning sign.

A similar situation applies to global warming when, during a cold or snowy spell someone triumphantly suggests that this has conclusively proven that global warming is a myth.

In discussing politics, the signal is when one makes a criticism of some action of the US government (such as its decision to ignore habeas corpus, or to invade Iraq, or its numerous covert destabilization actions in other countries) and the other person replies “If you don’t like it, then why don’t you go to Russia/France/China/Cuba/Sweden/(fill in the blank for whatever other country the speaker does not like)?”

In all these cases, the signs are clear that there has been no attempt by the other person to really engage with the issue and he or she has resorted to what he or she thinks is a clever debating point but in actuality has little or no content behind it.

In the case of the debates over the merits of a universal, government run, single-payer health care system, the signal that someone is not serious is when he or she trots out the waiting times for hip replacements in Canada as an argument about how the Canadian system is so terrible in comparison to the US. In the wake of the release of Michael Moore’s film Sicko, we can expect to see this being trotted out repeatedly, as indeed it already has.

As Kevin Drum pointed out a few months ago, the hip replacement argument is a sign of egregious cherry picking of data.

When comparing huge and complex systems like the health care or education systems in different nations, making point-to-point comparisons of isolated cases is of little use. No system is going to be better at every single thing, so this kind of debate results in each side selecting just those pieces of data to suit its purposes. There are probably some elective procedures for which there are longer waiting times in other countries than for those with high quality insurance plans in the US. It would not surprise me in the least if access to tests using expensive equipment like MRI machines is easier in the US (for those who have the requisite insurance coverage, of course) than it is for people in other countries. Health care in the US is aimed at servicing the well-to-do, because it is they who are the decision and policy-makers and as long as they are kept content, they are unlikely to want to make changes that reduce the profits of the health care industry, let alone eliminate them entirely, even if the changes benefit the general public.

One needs to look at aggregate measures to better compare quality and cost across nations. For example, the World Health Organization in 2000 put out The world health report 2000 – Health systems: improving performance in which it used the following measures for the comparison for health systems, using measures of both goodness and fairness:

  1. overall good health (e.g., low infant mortality rates and high disability-adjusted life expectancy);
  2. a fair distribution of good health (e.g., low infant mortality and long life expectancy evenly distributed across population groups);
  3. a high level of overall responsiveness;
  4. a fair distribution of responsiveness across population groups; and
  5. a fair distribution of financing health care (whether the burden of health risks is fairly distributed based on ability to pay, so that everyone is equally protected from the financial risks of illness)

Based on these criteria, according to the WHO study (p. 152), the US comes in at #37 in rank internationally, compared to France (#1), England (#18), Canada (#30), and Cuba (#39).

Michael Moore’s Sicko (which you should really see) points out that on measures like life expectancy at birth and infant mortality rates (i.e., the number of infants who die before reaching the age of one year for each 1,000 births), the US lags behind its developed world counterparts, even though its spends far more on health care as a fraction of its GDP (13.6% in 1998) than its nearest competitor Germany (10.6%). Per capita spending is also highest is the US ($4,178) with the next highest being Switzerland ($2,794).

The reason the US gets so much less for the money it spends on health care is because of the vast amounts siphoned off to the insurance and drug companies, partly due to profits and partly due to a huge bureaucracy to handle the complex billing and processing process involved with private health insurance. Such costs account for between 19.3 and 24.1% of health care spending in the US compared with between 8.4 and 11.1% in (say) Canada.

 image001.pngThere is a strong (negative) correlation between infant mortality and life expectancy, as can be seen from this graph, where each dot represents the data for a country, along with a linear regression line. The implication is clear that the best way to improve life expectancy is to reduce infant mortality. The reason that many developing countries have high infant mortality rates and resulting low life expectancy is that lack of access to clean water results in diarrhea and this leads to dehydration, which is often fatal for infants. (As an aside, the international conglomerate Nestle deserves widespread condemnation for its policy of marketing infant formula in the developing countries, despite the lack of easy access to clean water to prevent infection. Breastfeeding is always preferred except in exceptional cases, but because of the Nestle marketing campaign became perceived as inferior to formula.)

But when comparing the US to the rest of the developed world, access to clean water is not the main issue, so widespread access to health care emerges as the prime suspect for its low ranking. For example, infant mortality rates for non-whites in US cities are two to three times as high as the national average.

What really irks many people in the US about Moore’s film is perhaps not so much the adverse comparison with Canada, England and France. People who for some reason are enamored of the system here will complacently trot out once again hip replacement waiting times to claim a spurious superiority. It is the fact that among the 221 countries listed, Cuba’s infant mortality rate (6.04, rank 40) and life expectancy rates (77, rank 56) are almost identical with the US infant mortality (6.37, rank 42) and life expectancy (78, rank 45) that really rankles.

The US government’s implacable animosity to Cuba, trying to strangle its economy with boycotts and embargos and repeated attempts at destabilization and even assassination of its leaders, has to be one of the cruelest policies ever implemented towards a country that is not a threat to its security. And yet despite that deliberate attempt at destroying the Cuban economy, Cuba has managed to create a public health system that is a model for third world countries, and produces results in key indices that are comparable with the US. Cuba is legendary among third world countries in its generosity, sharing its medical personnel and expertise around the world.

Kevin Drum wonders if Moore’s use of Cuba in his film was a clever public relations strategy, knowing that it would trigger the almost reflexive anti-Cuba venom that exists in certain quarters in the US and that they would make a huge fuss, thus giving him free publicity. “Moore’s brilliance at getting his mortal enemies to do all his publicity for him is unparalleled.”

Drum may be right. In the weird media world we live in, it is not enough for Moore to accurately portray the scandal that is the US health system compared to its peer countries. That information has been out there for a long time, and ignored by the power elites. He had to create a fuss and by going to Cuba, he did so.

POST SCRIPT: This Modern World

Cartoonist Tom Tomorrow sums up the predictable responses to Sicko by the apologists for the US health care industry.

Evolution-6: The probabilities of natural selection













POST SCRIPT: Onion parody on evolution


Defending the right of free speech and Dennis Kucinich

Since today is a holiday, there will be no original post today. Instead, here are some video clips.

One is of the late Frank Zappa of the group Mothers of Invention on Crossfire talking about the right of free speech.

It is always fun when someone appears on these idiotic talk/yell shows and simply says what he thinks. In this clip from 1986, Zappa drives the person from the Washington Times crazy with his quick-witted defense of free speech and his sardonic sense of humor.

Also, here is an interview of Dennis Kucinich on David Letterman’s show. Kucinich is the only candidate for president who takes the correct stands on the two most fundamental issues facing the US: The Iraq war and the need for single-payer universal health care.