Universal health insurance makes 'business sense'
November 2, 2001
By Robert F. Smith, Herald Correspondent
BELLOWS FALLS — Single-payer universal health coverage could save Vermonters more than $118 million a year over current medical insurance costs and cover every Vermonter in the process, according to a new report.
The study, paid for by a federal grant and prepared for the Office of Vermont Health Access by John Sheils and Randall Haught of the Lewin Group, was the center of discussion Thursday night during a Health Care for All forum. The forum was organized by Windham County Democratic Reps. Michael Obuchowski and Carolyn Partridge, and was held at the New Falls Cinema in Bellows Falls.
About 75 people attended, many of them local doctors, health-care practitioners, mental health counselors and politicians. Several spoke out in favor of the single-payer universal health coverage concept, and no one disputed its value.
The guest speaker was Dr. Deborah Richter, a family physician with the Cambridge, Vt., health center, who said the main problem with the U.S. health system is not that millions of citizens are uninsured or that it costs too much. The problem with the country’s health system is that it doesn’t really have a system, she said.
The U.S. has what she termed a “loose arrangement” that wastes billions of dollars in administrative costs created by the vast number of different health insurance companies offering various health plans and all requiring different types and amounts of paperwork.
“It’s cheaper to pay directly for the medical costs than to pay insurance premiums,” said Richter, who is a member of Physicians for a National Health Program. “Every other industrialized country realized this long ago.”
Several health professionals agreed that administrative costs had gotten out of hand. A woman who manages a clinic said that nearly every patient the clinic serves has a different kind of insurance coverage requiring its own special paperwork, and one mental health professional said she spends half of her working time filling out forms instead of treating patients.
Richter explained that 70 percent of health care costs are spent on just 10 percent of the population, while the majority of people, 80 percent, account for only 15 percent of health care costs. Healthcare administration, which involves mainly paperwork, overhead and bureaucracy expenses, is responsible for 24 percent of all healthcare costs she said. In the past 30 years there has been a 2500 percent increase in the number of healthcare administrators, while the number of healthcare practitioners - doctors and nurses - only increased by 159 percent during the same period.
The Lewin Report showed that under the current system, Vermont residents will spend $2.2 billion on health care in 2001. The report estimated that a single-payer program would provide coverage for everyone in the state — including the 51,000 estimated to be presently uninsured — and still save $118 million, mostly by reducing the administrative costs of health insurance programs.
Under a single-payer program health coverage would be paid for by a payroll or income tax. This arrangement would mean that taxpayers making less than $75,000 a year would see an average yearly decrease of more than $1,000 per family over current health insurance costs, while those earning $75,000 to $100,000 a year would see a nominal increase of about $58 over what they currently spend for insurance. Hardest hit would be families earning over $150,000 a year. Universal health coverage could cost them as much as $4,500 more per year.
Rockingham physician Dr. Matthew Peake asked Richter who in Vermont would oppose universal health care and such dramatic cuts in healthcare costs.
“Did you miss the parts about getting rid of insurance companies?” Richter replied. She said that universal health care administered by the state would eliminate the need for insurance companies, and these companies are very wealthy and influential.
“Every poll taken shows that two-thirds of the American people are in favor of this,” Richter said. “The problem is that insurance and pharmaceutical companies have more money than we do.” But Richter said that it is inevitable that universal insurance coverage will be adopted, and she said that she is confident Vermont will lead the way within the next five years.
And while there have been problems with the program in some countries, she said that Vermont and the nation could examine all the universal coverage programs now in use around the world and find out what has worked and what hasn’t.
The bottom line for Richter was that she felt single-payer universal coverage would allow her to concentrate on medicine and not on paperwork. “The good side of this is that I’d be able to focus on practicing medicine without having to worry if my patient could afford it,” she said.
Richter and several others at the forum agreed that the key to creating a national universal health care system was to educate the public on its benefits. “In general, this is a better deal for businesses,” she said, “and they know it. It’s common sense, and it makes business sense.”
For more information about universal healthcare, and especially how it affects Vermont, go to <http://www.vthca.org>http://www.vthca.org.
Comment: Dr. Richter, a former president of Physicians for a National Health Program, is right on target when she is delivering her message to the business community. As with yesterday's Quote of the Day message, if business owners recognized the significant benefits of universal health insurance for both them and for their employees, then we would have a crucial ally in our efforts to bring equity to health care in America.