^{Posted on August 13, 2003}

Universal Health Plan is Endorsed

Published on Wednesday, August 13, 2003 by the Boston Globe

Universal Health Plan is Endorsed
Thousands of doctors back proposal in JAMA

by Liz Kowalczyk and Amber Mobley

Thousands of US physicians have endorsed a broad proposal that would abolish for-profit hospitals and insurers and transfer all Americans into an expanded and improved Medicare program for all ages, reigniting the debate over universal health care a decade after President Clinton’s failed plan.

While the four physicians who wrote the plan — three of whom are affiliated with Harvard Medical School — are members of a nonprofit organization that has long pushed for universal health coverage, the new proposal is important for two reasons: It was published today in one of the country’s most prestigious and its most widely circulated medical journal, the Journal of the American Medical Association, and because of the large number of doctors — nearly 8,000, including two former surgeons general — who endorsed it.

“The doctors said they hope to spark a debate over national health insurance that essentially ended with the death of the Clinton health plan.

Of the Democratic presidential candidates, only Rep. Dennis Kucinich is advocating a single-payer system.

Americans spend $1.6 trillion on health care, which the doctors say is more than enough money to cover every American. The doctors contend that there will be at least $200 billion in administrative savings in a single-payer, national insurance plan.”The Associated Press

JAMA officials said it is unusual for the journal, which has a circulation of about 700,000 worldwide, to publish an article endorsed by such a large number of physicians. JAMA’s editor, Dr. Catherine DeAngelis, said that an editorial accompanying the article represents the journal’s viewpoint that it is time for the country to grapple more seriously with major problems in the health-care system.

“Look, if you don’t agree with this plan, it’s not a foolproof plan, there are plenty of problems with it, come up with something better,” she said in an interview. “Let the debate resume. It’s sort of been on the back burner and it’s time we get on the stick with this. We are the only developed country in the world that doesn’t have a specific health plan for our people. It’s a disgrace. We have too many people not insured, and this is wrong.”

In the editorial accompanying the proposal, Rashi Fein of Harvard Medical School said one drawback of such a comprehensive plan is that it may be too radical to pass the US political system, but that the doctors’ proposal “should re-energize the debate.”

The plan, developed by the Physicians for a National Health Program, based in Chicago, differs from Clinton’s 1993 initiative in fundamental ways. Clinton sought to avoid large new taxes, instead seeking to require all companies to offer health insurance with federal subsidies helping small employers, Fein said. The country’s basic system — employers buying health insurance from nonprofit and for-profit insurance companies — would have remained intact.

The physicians’ plan is more radical and more encompassing, including coverage for the 41 million uninsured Americans as well as incorporating ways to control costs by setting a national budget, providing a set amount of money to hospitals for day-to-day operations and major expansions, paying for nursing home and home care for the elderly, and developing a national list of drugs the program would pay for.

The government would pay for health care through an expanded version of traditional Medicare, the federal health insurance program for the elderly. Most hospitals and clinics would remain privately owned and operated, and the national health insurance program would pay them a monthly budget for operating costs. Investor-owned facilities would be converted to nonprofit status. Private insurance companies would be virtually eliminated. The plan is endorsed by former surgeons general Dr. David Satcher, who served under Clinton, and Dr. Julius Richmond, appointed by Jimmy Carter.

One of the doctors’ arguments is that for-profit companies and multiple insurers are diverting money from clinical care for the demands of business. The physicians estimate that the country would save $200 billion annually by eliminating profits of investor-owned hospitals and insurance companies and by reducing administrative costs for hospitals and doctors who must bill dozens of different insurance companies. Private health insurers now consume 12 percent of premiums for overhead, while Medicare and the Canadian national health insurance system have overhead costs below 3.2 percent, the doctors reported.

Taxes, the doctors said, would increase. But except for the very wealthy, higher taxes would be offset by the elimination of insurance premiums and out-of-pocket copayments and deductibles, they argued.

Lead coauthor Dr. Marcia Angell, a senior lecturer at Harvard Medical School and former editor of the New England Journal of Medicine, said during a news conference in Washington, D.C., that the doctors want to curtail the entrepreneurial aspects of medicine, where insurers and providers avoid unprofitable patients and try to shift costs back to patients. But she said they also sought ways to control costs amid skyrocketing insurance premiums.

Dr. Steffie Woolhandler and Dr. David Himmelstein, both physicians at Cambridge Hospital and associate professors at Harvard Medical School, were coauthors.

Critics and even advocates of universal health insurance said the doctors’ proposal has major shortcomings. Susan Pisano of the American Association of Health Plans said private industry, not the government, has led the way in adopting disease management programs and prescription drug coverage. “Political pressures on Congress make change and innovation very difficult,” she said.

Giving hospitals a set monthly budget is similar to a form of managed care called “capitation,” in which insurers paid doctors and hospitals a set amount of money to treat patients. If they kept under the budget, providers made a profit; if they exceeded the budget, they lost money.

But capitation is now being called a failure by many providers, because it creates a financial incentive to limit care, and many insurers are moving away from it.

Further, many health-care economists questioned whether the proposal is realistic in the United States, given that even Clinton’s more modest plan failed.