News

The New York Times

The Health of Nations
By Donald L. Barlett and James B. Steele

For years the people in Washington have offered one plan after another that they said would provide health care for all Americans and rein in costs. Each plan has failed. Today more people than ever have inadequate coverage or no insurance at all. And still costs continue to spin out of control.

Notably absent from the rhetoric has been any mention of the existing system’s inherent flaw - the inability of market-based, for-profit medicine to deliver on the political promises.

Two decades ago, when Washington embraced the for-profit model to curb escalating charges, health care spending represented 10.5 percent of gross domestic product. Now it is approaching 16 percent. We spend more per capita on health care than any other developed country. Yet on the important yardsticks, like life expectancy measured in healthy years, we don’t even rank among the top 20 nations. In fact, according to the World Health Organization, we come in an embarrassing 29th, sandwiched between Slovenia and Portugal.

The explanation for this abysmal record is one that politicians decline to discuss. The market functions wonderfully when we want to sell more cereals, cosmetics, cars, computers or any other consumer product. Unfortunately, it doesn’t work in health care, where the goal should hardly be selling more heart bypass operations. Instead, the goal should be to prevent disease and illness. But the money is in the treatment - not prevention - so the market and good health care are at odds. Just how much at odds is seen in the current shortage of flu vaccine, as men and women in their 80’s and 90’s line up for hours at a time, hoping to get the shot they have been told they need, but may not receive because not nearly enough has been manufactured.

The reason for the shortage is this: Preventing a flu epidemic that could kill thousands is not nearly as profitable as making pills for something like erectile dysfunction, a decidedly non-fatal condition. Viagra, for example, brings in more than $1 billion a year for its maker, Pfizer. The profits to be made from selling flu vaccine are measly in comparison. If selling flu vaccine were as lucrative as marketing Viagra, sports broadcasts and the nightly news would be flooded with commercials warning that “winter is almost here; ask your doctor about flu vaccine” - and it would be available to anyone who wanted it. Instead, while many of those at risk of the flu go without the vaccine, primetime programs are sponsored by the makers of Viagra (“Get back to mischief”), Cialis (“Will you be ready?”) and Levitra (“Stay in the game”).

To understand what has gone wrong in health care, one need only look at the booming market for prescription drugs. Once upon a time, drugs were a needs-based product. You received a prescription when you were truly ill. Now many drugs are demand-driven, just like Froot Loops and Lucky Charms. Instead of using the cartoon characters that sell cereals, the drug companies employ celebrities.

One of the earliest was Lauren Hutton, the supermodel whose enthusiastic endorsement of Wyeth’s hormone replacement therapy helped propel prescriptions for all such drugs from 58 million in 1995 to 90 million in 1999. Ms. Hutton made the rounds of the talk shows, telling her “personal” story. She said her doctor warned her that if she didn’t take estrogen, “I was up for colon cancer, eye loss, osteoporosis, shrinkage, lots of things.”

More recently, Merck recruited Dorothy Hamill, the Olympic gold medalist, to pitch Vioxx. “This is my favorite time to skate,” Ms. Hamill said in a commercial. “I guess it’s from all those years of 5 a.m. practices. But it’s also the time when the pain and stiffness of osteoarthritis can be at their worst.”

As has been the case with so many other drugs, estrogen therapy and Vioxx proved to be a triumph of marketing over science. Not only did the hormone replacement drugs fail to provide the promised protection, studies found they increased the risk for developing cancer and heart disease. Vioxx was withdrawn last month after evidence from clinical trials showed that it increased the risk of heart attacks and strokes.

Since 1997, when the Food and Drug Administration loosened restrictions on television commercials for prescription drugs, the marketing departments of pharmaceutical companies have exercised ever-greater influence on which drugs will be brought to market. That’s why we have three drugs to treat erectile dysfunction, a condition that once was called “impotence.” The name change was essential for the products to be sold by the likes of Bob Dole or Mike Ditka, the former Chicago Bears coach.

Aggressive marketing and pricing have made pharmaceutical companies America’s most profitable industry. On the whole, Americans pay higher prices for prescription drugs than anyone else in the world because the United States is the only industrialized nation that does not exert influence over prices.

What’s needed to control the costs and to provide basic health and hospitalization coverage for all Americans is an independent agency that would set national health care policy, collect medical fees, pay claims, reimburse doctors fairly and restrain runaway drug prices - a single-payer system that would eliminate the costly, inefficient bureaucracy generated by thousands of different plans. It’s not such a radical idea; a single-payer system already exists for Medicare.

Such an agency would need to be free of politics and could be modeled on the Federal Reserve System, whose members are appointed to terms that do not coincide with the terms of either the president or the Senate. It could be financed through two taxes, a gross-receipts business tax and a flat tax, similar to Medicare, but on all individual income.

Under a single-payer system, never again would you be asked, when calling to make a medical appointment, “What type of insurance do you have?” Never again would doctors need bloated office staffs to track what is and is not covered under thousands of insurance plans. Never again would you have to worry about being bankrupted by a medical emergency. Never again would American business be saddled with the responsibility for providing health insurance.

A unified, single-payer system could do more than pay the bills. It could gather information to more accurately identify the surgical procedures and drugs that work, and those that don’t. It could funnel research money to where it will do the most good rather than to those areas with the largest and most vocal constituency, thereby treating the victims of various diseases and conditions more equitably.

It could make possible a centralized computer network to reduce the 100,000 deaths each year from adverse drug reactions - a number of fatalities five times greater than those caused by street drugs like cocaine and heroin. Similarly, a nationwide network could track medical errors across the country to increase accountability and to identify hospitals or surgeons who make repeated mistakes. And it could guarantee supplies of needed medications. In short, over time such a system could transform the practice of medicine and give all Americans the first-class health care they deserve - without breaking the bank.

Donald L. Barlett and James B. Steele are editors at large at Time and the authors, most recently, of “Critical Condition: How Health Care in America Became Big Business-And Bad Medicine.”

Posted by pnhp at 01:49 PM | Permalink

FOR IMMEDIATE RELEASE
OCTOBER 22, 2004
1:16 PM
CONTACT:  Families USA
Geraldine Henrich (202) 628-3030
 
New Report Shows Nearly Half of Americans in Medicare at Risk of Losing Coverage
Millions of Seniors and People with Disabilities will Experience Temporary or Long-Term Reductions in Care Under New Medicare Law

WASHINGTON- A careful analysis of the new Medicare law and the Administration’s proposed regulations shows that approximately half of the program’s beneficiaries are at risk of being worse off than they are today, according to a special report released by Families USA, the voice for health care consumers.

Seniors and people with disabilities may lose drug coverage altogether, lose access to needed drugs, have higher out-of-pocket costs for their medicines, find their retiree coverage scaled back, or enjoy fewer consumer protections. As a result, they will experience temporary or long-term reductions in care that is vital to their health.

Those at risk of being worse off include:

• The 6.4 million so-called “dual eligibles,” those who qualify for both Medicare and Medicaid. America’s poorest seniors and people with disabilities will lose their current drug coverage provided by Medicaid on December 31, 2005.

• The 13 million retirees with drug coverage from their previous employers, who are at risk of losing at least portions of that coverage.

• The 4.7 million seniors currently enrolled in Medicare Managed Care Plans, who will receive fewer protections than they have today.

Families USA is the national organization for health care consumers. It is nonprofit and nonpartisan and advocates for high-quality health care for all Americans. www.familiesusa.org Families USA Foundation

###

Posted by pnhp at 09:36 AM | Permalink

Thursday, October 14, 2004 (SF Chronicle)
In Critical Condition: Health Care In America/Canada’s Way/What a universal health care system delivers, good and bad
Barry Brown, Chronicle Foreign Service

Toronto — Discovering he had colon cancer came as a shock to John Kioussis, but after 10 days in the hospital, attended by a battery of medical specialists, technicians, nurses and other staff, his bill came to less than $85 in American dollars — and that was only for his phone and cable TV.

Under Canada’s government-funded health insurance system, Kioussis’ care, from the first visit to a family doctor, through visits to two specialists of his choice and his hospital stay, was free, paid for by Ontario’s publicly funded universal health coverage.

“When you’re sick like that and off work, the last thing you want to worry about is how to pay the bill,” said Kioussis, 55. “I had excellent care and one of the top specialists in the country, the same doctor who would treat the prime minister.”

That’s the side of Canadian health care familiar to many Americans — a system that provides free cradle-to-grave treatment to all, regardless of income or employment status.

The fact is, though, that Canada’s system is riddled with problems, many stemming from inadequate funding. As a result, delays of several months are common before seeing a specialist or getting nonemergency surgery.

For his part, Kioussis said the month he waited between seeing his family doctor and his surgery did not seem unreasonable. He admitted, though, that because of a personal connection between his brother and the surgeon, the doctor operated on him just before he left for vacation.

Although delays and other problems have caused support to dip slightly, Canadians still overwhelmingly back their universal health program. They think of their health care system as a mark of their national identity, something that separates them from Americans.

Meanwhile, a recent ABC News poll showed that while Americans value the quality of U.S. health care, 62 percent think the nation should shift to a universal health insurance program like Canada’s.

As a result of the sharply differing approaches Canada and the United States have taken toward financing health care, their medical systems have developed in contrasting ways.

The United States has more hospital beds per person than Canada because most American hospitals are private, while almost all Canadian hospitals are publicly funded. As a result, American hospitals compete for patients, while Canadian hospitals “don’t fund excess capacity,” said Sharon Sholzberg-Gray, chief executive of the Canadian Healthcare Association.

By many measures, Canadians are healthier than Americans, with a longer lifespan and lower infant mortality, even though they spend much less on medical care. Canadians devote about 10 percent of their gross domestic product, the total of a nation’s goods and services, to provide full health coverage for all citizens. American health costs account for about 14 percent of GDP, yet 45 million Americans have no health insurance and many more have limited coverage.

One of the main culprits pushing up the cost of care in the United States is the expense of administering a plethora of complicated health plans. It has been estimated that any large health insurer in a midsize U.S. state spends more on administration than is spent on health administration in all Canada.

Dr. Catherine Kurosu is a gynecologist at two San Diego hospitals. A Canadian, she said the biggest differences between the two systems are that poorer Americans won’t seek medical care until their problems have become serious. In addition, she said, American insurers often play games to avoid paying bills.

In San Diego, a lot of pregnant women — especially illegal immigrants — show up with problems that could have been avoided with prenatal care, she said. The idea that they can’t get this kind of care “still seems foreign to me,” she said.

My patients are always interested in finding out about the health care system when they find out I’m Canadian,” she continued.When it comes to billing, the Canadian system is a simple matter of sending an invoice to the Ministry of Health, which pays on a fee-for-service basis, she explained. In the United States, there are so many insurance companies, each with its own rules covering not only the patient but also the doctor — as Kurosu learned when she had to wait months for an insurance company to approve her.

U.S. health insurers nickel and dime doctors by always sending bills back and questioning everything, she said. “It’s like a game to see how long they can forestall payment.”

Eleven years ago, Colleen Burns started a medical imaging business in Buffalo, N.Y., right across the border from Ontario. She expected 20 percent of her business would come from Canadians willing to pay $300 to $600 in U.S. for quicker access to high-tech diagnostics. Instead, the proportion is only about 8 to 10 percent, she said. Canadians need to feel a sense of urgency and have the money before coming to the United States, “because they can get an MRI for free in Canada,” she said.

The health system is now itself in need of emergency care in order to continue offering the benefits Canadians have come to think of as their birthright, according to many experts. Dr.Albert Schumacher, president of the Canadian Medical Association, warns that shortfalls of cash and medical staff have left the system unsustainable without major reform.

Twenty years ago, Canada’s federal government unified the various health insurance programs run by the provinces.Ottawa offered to pay 50 percent of the programs’ operating budgets, provided the provincial plans accepted five basic principles, including nationwide acceptance of each provincial plan, comprehensive coverage and no out-of-pocket costs (co-payments or deductibles) for insured services.

“But since then, the federal share has dropped to as low as 14 percent,” said Schumacher, a family physician from the border city of Windsor, Ontario.

In the 1990s, Canadian governments at all levels began attacking their budget deficits with single-minded intensity. With health care accounting for about 40 percent of public sector spending, hospitals were closed, physician fees were frozen or cut, nurses were laid off, and spaces for medical students and medical technicians at government-funded universities and colleges were cut back.

Along with a money crunch, Canada “has a terrible shortage of physicians, “particularly specialists and surgeons, a high proportion of whom are over 55 and ready to retire, Schumacher said. Fixing the health care system has become a high priority for Canada’s political leaders.

Last month, Prime Minister Paul Martin made good on his main election promise to inject more cash into provincial health programs and move to shorten waiting lists.

At a national health care summit, Martin told provincial leaders Ottawa would ante up the equivalent of an additional $34 billion in U.S. funds over 10 years to provincial and territorial health programs, as well as an additional $3 billion to ease wait times for hip replacement surgeries, cardiac and cancer treatments. He also agreed to a plan for monitoring waiting lists to determine the best method of reducing them.

As in the United States, the main problems bedeviling Canada are the soaring cost of prescription drugs and an aging population. Canada’s provinces had called on Ottawa to use its hefty budgetary surplus to launch a national drug plan and leave to them the remaining health care costs, including home care and services like psychiatry and chiropractics.But during the summit, provincial leaders abandoned that effort in exchange for more overall funding from Ottawa.

Sholzberg-Gray of the Canadian Healthcare Association said another challenge plaguing the Canadian system is the drain of doctors and nurses lured by higher pay and lower taxes in the United States.

“There is also a circular effect, because some doctors come back so they don’t have to collect bills,” she added. On the issue of waiting lists for nonemergency surgery, Sholzberg-Gray believes the federal government should establish time limits for treatment.

One feature of Canada’s health care system is that if someone wants to bypass the public program and, for example, pay a doctor to perform hip replacement surgery after hours, he cannot. Because of fears that slipping the doctor a little something extra could lead to the breakdown of the equal- access-for-all principle, paying for insured services is illegal.Those who believe that more private care clinics would solve the problem of funding and shortages have taken their case to Canada’s Supreme Court in an effort to open the system.

ODD MAN OUT
The United States is the only developed nation without universal health care. Although health insurance systems worldwide are straining as populations age, safety nets have largely remained in place. Here are brief descriptions of insurance systems of several nations..

France
Health care as percentage of GDP: 9.6
Health expenditure per person: $2,567
Universal care funded through mandatory health insurance provided by
Social Security, with private supplemental coverage filling gaps..
Germany
Health care as percentage of GDP: 10.8
Health expenditure per person: $2,820
All individuals are enrolled in government-approved health insurance plans partly financed by employer and employee contributions, although high-income workers may buy private insurance instead..
Japan
Health care as percentage of GDP: 8
Health expenditure per person: $2,131
A dual system in which workers enroll in insurance programs through their jobs, while all others join Japan’s national health insurance plan..
United Kingdom
Health care as percentage of GDP: 7.6
Health expenditure per person: $1,989
A publicly funded National Health Service provides free care, with the option of private insurance for those wanting treatment outside the state system..
United States
Health care as percentage of GDP: 13.9
Health expenditure per person: $4,887
Federal and state governments pay most of the cost of care for seniors and
the poor, with employer or individually financed insurance available for others. About 45 million people lack coverage.
*2001 figures
Source: World Health Organization, Chronicle research

Five-Part Series
This week The Chronicle is examining in depth the causes, effects and responses to rising health care costs in America.
Monday
Why health care costs are rising fast. Plus the Bush and Kerry health care plans.
Tuesday
Retirees hit hard as health benefits are lost.
Wednesday
Health care tops the labor-management agenda.
Today
How Canada provides health care for all.
Friday
Employees are digging deeper to pay for health insurance.

Posted by pnhp at 03:13 PM | Permalink

Poor Health, Not Lack of Primary Care or Medical Insurance Found to Drive Emergency Visits
American College of Emergency Physicians
News Release - October 18, 2004

The first large-scale study of its kind finds the majority of individuals who use emergency departments have a usual source of care, medical insurance and are not poor. The biggest factor driving people to seek emergency care is poor physical and mental health…

In this study, based on a sample of nearly 50,000 adults interviewed between 2000 and 2001, 83 percent of emergency department visits were made by people who reported having a usual source of health care other than an emergency department, 85 percent reported having medical insurance, and 79 percent reported having incomes exceeding the poverty threshold. Individuals without health insurance were no more likely to have had an emergency visit than those with private health insurance, and individuals without a usual source of care were 25 percent less likely to have had an emergency visit than those with a private physician.

“Contrary to popular perception, individuals who do not have a usual source of care are actually less likely to have visited an emergency department than those who have such care,” said the study’s lead author Ellen J. Weber, MD, Professor of Clinical Medicine in the division of emergency medicine at the University of California, San Francisco. “Many insurance programs, and particularly public and private HMOs, require beneficiaries to have a primary care physician, which may be expected to improve overall health and health care, but the continued rise in emergency visits implies that such programs have not had a substantial impact on overall emergency department use.”

“The mistaken belief that emergency departments are overcrowded by a small disenfranchised portion of the U.S. population can lead to misguided policy decisions and a perception by hospital administrators that emergency patients are not as valuable to the institution as patients having elective surgeries,” said Dr. Weber. “But our findings indicate that emergency departments serve as a safety net, not just for the poor and uninsured, but for mainstream Americans, and in particular those with serious and chronic illness.”

http://www.acep.org/1,34130,0.html

Comment: Clearly, the primary role of emergency departments is to serve as a safety net for mainstream Americans. Although much concern is expressed over the use of emergency departments by the disenfranchised poor and uninsured, this study confirms that emergency facilities are not being used as convenience clinics by this group. These people are simply not receiving the care that they need.

When the need for comprehensive reform is so obvious, we should not be distracted by efforts to enact misguided policies based on fundamental misperceptions.

Let’s first provide comprehensive coverage for everyone. Once health care funding is no longer the overriding issue, we can concentrate on policies that would ensure timely access to a usual source of care. Because of work conflicts and transportation issues, that might include enabling access to integrated convenience clinics. Whatever. But, at a current spending level of $1.8 trillion, we don’t need to increase funding; we need to start spending our funds more effectively.

Posted by pnhp at 09:21 AM | Permalink

Yesterday’s message on physicians’ ranking of liability reform as their number one issue provoked numerous responses. The predominant theme of the replies was that the dramatic increases in liability insurance premiums cannot be absorbed by fee increases since most fees are now controlled by public and private third party payers. It is clear that the current debate limited to MICRA-type reforms is missing the point. We need dramatic new approaches to the problem of medical injury.

Following is a much more inspiring message from a voice representing the future of health care in America.

Casey KirkHart, DO, Jack Rutledge Fellow of the American Medical Student Association (AMSA):

Thank you for this post and for your insightful comments.

I too have experienced a mix of reactions to the swelling of physician (and medical student) involvement in the political process vis a vis medical liability. As an organizer of future physicians, I relish the idea of students and physicians standing up together in the public eye to call for change to our dire health care system. Health professionals, in particular young doctors and students, must lead the call to reform as AMSA and others have done for decades.

On the other hand, I can’t think of a more fruitless and uninspiring political battle than the one surrounding tort reform. I spent the last few weeks touring medical schools in various swing states discussing the candidates’ health plans. The debate would invariably turn to medical liability, despite potential real ground to be made this November 2nd on health care access and affordability. While an important issue to address, I feel that it is more political “smoke and mirrors” in comparison to the bevy of ailments facing medical practice and the health care system.

In my leadership capacity, I have been asked to speak to and support efforts around tort reform, and when I do, I do so with caution. I suggest to medical students to examine every side of the medical malpractice issue, from the patient, lawyer, physician, and systemic perspectives, before investing oneself in the tort battle. Until we create a more comprehensive solution to malpractice, including those proposed by Kerry and Edwards, I fear little relief from the so-called medical malpractice crisis.

Some physicians’ organizations have made this their #1 legislative issue, but medical students have, quite possibly, the only comprehensive answers. In the last few years, AMSA has passed policy that describes our priorities in medical malpractice and I am proud to say that they are founded first and foremost in patient safety, physician security and excellence, and honoring the clinical relationship.

I invite you to read AMSA’s stance on medical malpractice at http://www.amsa.org/about/ppp/prof.pdf#zoom=120,40,50

We have produced a number of sophisticated educational pieces on medical malpractice and the forces that shape it. Please feel free to share this resource with your colleagues and students. I would appreciate feedback on this useful tool.

http://www.amsa.org/hp/issues.cfm

I hope you found these comments, well, hopeful. I can attest that in the hearts and minds of future physicians, our priorities differ greatly from those of the survey. The future of medicine is in good, strong hands.

In solidarity,
Casey KirkHart, DO
AMSA Jack Rutledge Fellow

Don’s comment: For those interested in this topic, I emphatically recommend the links noted in Casey’s message.

Posted by pnhp at 09:06 AM | Permalink

Contact:
Laura Finlayson, laura@rosica.com
or Tiffanie McKinnon, tiffanie@rosica.com,(201) 843-5600
Nick Skala, nick@pnhp.org, (312) 782-6006

Embargoed Until Tuesday, October 19, 2004 - 12:00 PM

1.7 MILLION VETERANS LACKED HEALTH COVERAGE IN 2003

Harvard/Public Citizen Study Finds Sharp Increase Since 2000

1.694 million American veterans were uninsured in 2003, according to a study by Harvard Medical School researchers released today. Of the 1.694 million uninsured, 681,808 were Vietnam-era veterans while 999,548 were veterans who served during “other eras” (including the Persian Gulf War).

The study was based on analyses of government surveys. Veterans were only classified as uninsured if they neither had health insurance nor received ongoing care at Veterans Health Administration (VHA) hospitals or clinics. Many of the 1.694 million uninsured veterans in 2003 were barred from VHA care because of a 2003 Bush Administration order that halted enrollment of most middle income veterans. Others were unable to obtain VHA care due to waiting lists at some VHA facilities, unaffordable co-payments for VHA specialty care, or the lack of VHA facilities in their communities. An additional 3.90 million members of veterans’ households were also uninsured and ineligible for VHA care. Other findings of the study include:

*The number of uninsured veterans has increased by 235,159 since 2000, when 9.9% of non-elderly veterans were uninsured, a figure which rose to 11.9% in 2003.

*More than one in three veterans under age 25 lacked health coverage, as did one in seven veterans age 25 to 44 and one in ten veterans age 45 to 65.

*Many uninsured veterans had major health problems. Less than one-quarter indicated that they were in excellent health; 15.6% had a disabling chronic illness.

*Uninsured veterans had as much trouble getting medical care as other uninsured persons. 26.1% of uninsured veterans reported that they had failed to get needed care due to costs; 29.0% had delayed care due to costs; 42.1% had not seen a doctor within the past year; and two-thirds failed to receive preventive care
more
1.7 Million Veterans Lacked Health Coverage in 2003 … add one

*More than two-thirds of uninsured veterans were employed and 86.4% had worked within the past year; 7% of the uninsured vets worked at two or more jobs.

David U. Himmelstein, M.D., study author and Harvard Medical School Associate Professor, commented: “This administration professes great concern for veterans, but it’s all talk and no action. Since President Bush took office the number of uninsured vets has skyrocketed, and he’s cut VA eligibility, barring hundreds of thousands of veterans from care. Our president has put troops in harm’s way overseas and abandons them and their families once they get home.

“Like other uninsured Americans, most uninsured vets are working people. And uninsured veterans are denied the care they need – turned away because they can’t pay,” said Dr. Steffie Woolhandler, a study author and co-founder of Physicians for a National Health Program. “We need a solution that works for veterans, and for all Americans – national health insurance.”

Sidney M. Wolfe, M.D., study author and Director of Public Citizen’s Health Research Group said, “The armed services are aggressive in encouraging people to join the military to serve their country and to ‘be all you can be’. But after leaving the service, almost 1.7 million veterans do not have the right to health care, in a way, being discarded by the government after serving their country. Without access to health care, no one can be all that they can be.”

Physicians for a National Health Program is a national organization with more than 12,000 physician members that advocates for national health. Public Citizen is a national non-profit organization with 150,000 members that engages in research and advocacy to protect health, safety and democracy.
###
To download the Veterans report (pdf)
Please click here

Posted by pnhp at 10:09 AM | Permalink

Political passions drive doctors to campaign
By Joel B. Finkelstein
American Medical News - Oct. 25, 2004

Issues important to physicians
In a survey of 1,050 physicians…
Ranked as No. 1 issue:

42% - Liability reform
20% - Cost of coverage
18% - Uninsured Americans
10% - Abortion
04% - Medicare
03% - Patients’ rights
02% - Cost of Rx drugs
01% - Benefits for seniors

Source: Muhlenberg College

http://www.ama-assn.org/amednews/2004/10/25/gvl21025.htm

Comment: My first reaction was the profound sense of sorrow felt on my realization that physicians do not place the plight of the uninsured and lack of affordability of health care above all else. The actual impact of liability issues on the health care system is almost negligible when contrasted with the major impact of financial hardship, suffering and even loss of life that insurance and cost issues have. How could physicians ever come to the conclusion that the nuisance of facing lawsuits is a more important issue than the suffering and financial hardship of many of their patients?

But giving this more thought, instead of going into a funk over how physicians could be so callous, I decided that we need to ask ourselves why so many physicians do place this as the number one priority. It is unlikely that individuals who have dedicated their lives to the healing arts are really insensitive to their patients’ needs. It is more likely that physicians are exposed to unrelenting anxiety and stress that has made their lives relatively miserable. Although, objectively, that level of misery cannot compare to the suffering of their patients who cannot afford access to care, it must be foremost in their minds, probably because it is a psychological pain that never seems to go away.

There is a lesson here. We want our health care professionals to be contented as they dedicate themselves to improving the health of their patients. Malcontented professionals will always underperform.

Medical injury is certainly an issue that we must address. But it is very clear that the process must be revolutionized so that the physicians’ motivations will be to assist their patients in attaining access to care in an environment that is as error-free as possible, but also to assist them in obtaining appropriate compensation when the system has failed to prevent harmful errors.

The patient must always be placed first. And the patients’ interests will be served best in an environment that is a rewarding experience for the patients’ health care professionals.

Posted by pnhp at 09:29 AM | Permalink

AMY GOODMAN: We’re joined by Dr. Steffie Woolhandler, association professor of Medicine at Harvard University, co-director of the Harvard Medical School General Internal Medicine Fellowship program. Also, Sally Pipes, president of the San Francisco based Pacific Research Institute, author of the new book, Miracle Cure: How to Solve America’s Health Care Crisis and Why Canada Isn’t the Answer. Sally Pipes, let’s begin with you. You’re assessment of what President Bush has proposed as well as John Kerry?

SALLY PIPES: Yes. Good morning, Amy. I grew up in Canada under Canadian health care, and now the average wait in Canada from seeing a GP to a specialist has gone from in 1993 from nine weeks to 17.9 weeks. So, we have two different plans here. President Bush’s plan is talking about, you know, giving patients and doctors control over the health care rather than government bureaucrats. He’s looking at expanding health savings accounts to provide affordable coverage to individuals and businesses. He’s talking about making changes in tort reform to reduce malpractice awards. He is setting up association health plans so small businesses can band together and provide coverage for workers. Plus refundable tax credits for low income American individuals and families. On the other hand, presidential candidate, Kerry, his plan in my estimate and those of others, economists that I work with, is trillion dollars over ten years. He is saying that he will get this money through rescinding the Bush tax cuts. That would really only cover one-third of the cost. But the real issue in the Kerry plan is he would move the American people more to a Canadian single payer style system. This is just one step. It’s really talking about putting millions of middle income Americans into Medicaid, the federal state health plan for the poor, and putting millions of more Americans into a system of managed competition, which is similar to what Hillary Clinton proposed more than a decade ago. I’ll just make one point on that and you know, when you look at President Clinton and his terrible heart problem, he went in to the doctor on a Thursday, and he had an angiogram Friday, on Monday, he had quadruple bypass. If he lived in Canada, or if Hillary Clinton’s plan had passed, he would be looking at an average wait of 3.4 weeks from seeing a GP to seeing a cardiologist, another 2.1 weeks for having urgent bypass. If it wasn’t that urgent, it would be 10.7 weeks. His plan really is putting more and more government into our lives. The Bush plan is really talking about letting consumers be empowered to take control over their health care and I think that in my opinion, having grown up under Canadian health care, this is the option that Americans will like. You cannot take the American people into that program. It’s just a government program. It’s just not going to work.

JUAN GONZALEZ: Dr. Steffie Woolhandler, Associate Professor of Medicine at Harvard University, your response to the Bush plan and also your sense of what Senator Kerry’s plan entails.

DR. STEFFIE WOOLHANDLER: I’ll get to Bush and Kerry in a minute, but I cannot let the falsehoods about Canada stand. When people look scientifically at waits in Canada the average wait for urgent heart surgery is one day. The average wait for non-urgent heart surgery is 17 days. So, Sally’s numbers come from a crackpot research organization that has no credibility, and her organization has been spreading those numbers around and they’re not true. The truth is Canadians have complete free choice of doctor or hospital. They live
two to three years longer than Americans, and they’re spending about half of what we do on health care. The reason is that they have so much administrative efficiency by getting rid of the insurance companies and their paperwork, they can afford universal care. Now, our group, Physicians for a National Health Program, which is a leading advocate of single payer health care, does not advocate the Canadian system. We advocate Canada Deluxe. We advocate spending the same amount what they’re spending now twice what they have in Canada, but achieve the administrative efficiency and universal coverage of Canada, so we could cover everyone with no waits of any type. But getting back to the question of Bush and Kerry, Mr. Kerry gets us less than halfway there, even if his plan is successful. He will leave 17 million Americans with no health insurance. Let’s not pretend that’s really universal health care.

Mr. Bush’s plan is actually quite a bit worse. He intends to pour money into tax credits which will not succeed in covering people. We know that because Mr. Bush is modeling his plan after an existing tax credit program called the Trade Adjustment Assistance Act, where less than 2% of eligible people have decided to take the tax credit. The reason is that Bush is talking about offering a tax credit of $3,000 for a family to buy health insurance. But the average family policy in this country costs $10,000. This would leave a family with $7,000 they would have to take out of their own pocket in order to get health insurance. And obviously, a low income family, an unemployed family, is not in a position to pay an additional $7,000 out of their pocket for health care. Hence the tax credits are not going to be sufficient to allow low income people to buy health insurance and they’re simply not going to get any coverage out of Mr. Bush.

JUAN GONZALEZ: Sally Pipes, your response, especially on the whole issue of the administrative cost savings as a result of the plans of Senator Kerry; and doesn’t a bigger, more organized system with one buyer have power to control prices better and to prevent health care costs from spiraling?

SALLY PIPES: The Canadian system is expensive. First of all, you’re comparing apples with oranges. Canada doesn’t include the capital costs of hospitals in their numbers.

DR. STEFFIE WOOLHANDLER: That isn’t true.

SALLY PIPES: Excuse me. Canada has the third most expensive health care system in the world after the United States and Switzerland. Canadians, if you look on websites, you will see the stories of Canadians who are having to wait, who cannot get doctors and are leaving Canada to come to the United States. There’s a woman in Quebec, who is suing the Quebec government in a malpractice suit for $37 million. She’s suing on behalf of 10,000 Quebec breast cancer patients who had to wait over the limit of eight weeks to get radiation oncology. The Canadian Medical Association came out with a report two weeks ago saying that over 50% of Canadians are incredibly dissatisfied with the health care that they are getting, just look on websites and see the number of Canadians who are upset. And Canadians use America as a safety valve. Look at the border towns. Senator Ed Lawson, who was head of the Teamsters union, and became national senator, when he was diagnosed two years ago with heart situations similar to president Clintons, they told him to wait, even a person of such importance as himself, left and came to — went to Seattle, Washington, because he didn’t want to wait two weeks to get an angiogram. So,you know, I’m not a crackpot institute. That was very insulting. I have done a lot of work. I have worked in Canada on this issue. There is tremendous work done by the Frasier Institute in Canada on hospital waiting lists. It’s all scientifically done. The administrative costs in Canada, you’re not comparing apples with apples it is the third most expensive system in the world.

In the United States today, 45% of our health care dollars are actually in the government system between Medicaid, Medicare, the State Children’s Health Insurance Program and things like that.

DR. STEFFIE WOOLHANDLER: I’m not calling Sally a crackpot. I’m calling Frasier Institute that she quotes extensively crackpot. This is the group that thinks we ought to privatize the whales. This is a group that thinks that we should abolish medical licenses.

SALLY PIPES: This is a group that thinks there should be private options in Canada. I think a lot of people in the United States think that Canada

DR. STEFFIE WOOLHANDLER: Sally, I let you talk, okay. Now it’s my turn. The reality is Canada spends half of what we do. I happen to have published a definitive article on the administrative costs in the New England Journal of Medicine. I know what the Canadian hospital cost reports look like. I know what Canadian cost reports look like. Canada spends half of what we do. That’s what the Organisation for Economic Co-operation and Development and the UN say. And that’s the reason why they do have some waits for elective services in Canada. Elective services. Do think that’s a good thing? No. I don’t think we should have to wait for things. But if we have a Canadian style system, and spend twice as much money, then there’s no reason to have any waits. That’s not just my opinion, that’s also the opinion of the US General Accounting Office and the US Congressional Budget Office.

AMY GOODMAN: I’d like to ask Sally Pipes, what do you think is good about John Kerry’s proposal?

SALLY PIPES: Well, I don’t think that there are good things about it. I think the numbers came out from the Census Bureau saying that 45 million America ns do not have insurance. You have to look and analyze who are the 45 million Americans. Because 16% of them are people who are earning over $75,000. 33% are people who are earning over $50,000. Just because you don’t have health insurance does not mean that you don’t get health care. There’s a lot of money spent by individuals who don’t have health insurance who go out and buy their own. They pay out of pocket for their health care. Really, 8 million Americans are people who are chronically uninsured, and low income. Those are the people that I think that the government needs to take care of. And I definitely believe that there are — you know, children and low income families that do need care. I think for the rest of people, we need to open up system to empower consumers to get the best health care they can. People, when you look at any government program, most people do not like the DMV. The post office became more competitive when it opened up to competition from fed ex and UPS and a variety of things. Competition is what makes the world go around. Canadians do not have any form of competition. Any private coverage in Canada is outlawed under the Canada Health Act.

JUAN GONZALEZ: Let me ask you, Sally Pipes, drugs, the cost of prescription drugs have become a huge part of health care costs in this country, and if our system, as it is now structured, is doing so well, why are so many Americans trying to get to Canada, or to Mexico to buy prescription drugs?

SALLY PIPES: Today in America, Americans spend 1% of their income on prescription drugs. In the 1960’s Americans spent 1% of their income on prescription drugs. There are a number of drugs that are available in Canada— in the United States that allow us to — many — the drugs today allow us to live longer and healthier lives. From 1997 to 1999, out of 100 new drugs that became available in the United States, only 43 of them made it onto the formular
y in Canada. A lot of the top drugs in the United States that are used in Canada are generically available in the United States, and are cheaper, but the real issue here about prescription drugs, Americans want lower prices for prescription drugs. The reason they’re — the drugs are lower in Europe and Canada is because of price controls. So, what people really want in America is price controls on drugs, which is going to have a negative impact on research and development in this country, and innovation. New drugs have reduced costs for hospital stays because people can use drugs now for ulcers, for instead of having gall bladder surgery. We’re reducing costs by allowing Americans to have access to the greatest drugs and innovation in the world.

JUAN GONZALEZ: Dr. Steffie Woolhandler, I’d like you to respond to the issue of drugs and the differences between Canada and the United States.

DR. STEFFIE WOOLHANDLER: I want to remind that you, Canadians do live two to three years longer than Americans. That was not true before they went with National Health Insurance. That’s because the National Health Insurance program has allowed them good access to all types of care, including drugs. Canadians, about half of Canadians do get their drugs through their insurance. But all Canadians benefit from a system whereby the government negotiates with drug companies for lower prices. So, Canadians are paying about 60 cents on the dollar that Americans pay, and they’re paying only 60% of what we pay for drugs, and they really are the same drugs. Sally’s idea that you cannot get drugs in Canada is simply not true.

SALLY PIPES: I’m not saying you can’t get drugs.

DR. STEFFIE WOOLHANDLER: They have access to the same drugs that we do, they can just afford them. And similarly, Sally’s contention that uninsured people get all of the health care they need, doesn’t make common sense, but is also belied by a huge body of literature. Most recently, Ayanian colleagues published a study looking at people aged 55 to 65 who have no health insurance, and 10% of the people died over an eight-year period. They died at 33% higher rate than people who had insurance. It’s just common sense that if you don’t have a way to pay for care, you are going to get less of it, and it’s going to impact your health and maybe make your die younger.

AMY GOODMAN: Who benefits under Bush’s plan?

DR. STEFFIE WOOLHANDLER: Well, there’s a big benefit to some middle income taxpayers who end up taking a tax credit where they already had insurance. Now, they can get a tax credit that helps them pay for it. So, there’s some benefit to that. He’s very big, in general, Bush’s policies are very big with the insurance industry and drug industries. Because he has a very hands-off approach, where all of the government taxpayers do is just send more money into the system. There’s no attempt by the government to regulate things or make them more fair.

AMY GOODMAN: Sally pipes?

SALLY PIPES: Well, I’d like it just comment on one thing. Canada is a country of 32 million people, fewer than in the state of California. We have much less ethnically diverse. We don’t have the minority low income populations that are in the United States. If you compare white Canadians to white Americ ans, Americans are now living longer than Canadians. I think that the Bush plan

DR. STEFFIE WOOLHANDLER: No, that isn’t true, Sally. It’s simply not true. Canada Health Survey .

AMY GOODMAN: We actually have to leave it there. I want to thank you both for being with us. I know that you both have to race off anyway. Sally Pipes, president of the San Francisco based Pacific Research Institute. Her new book is called Miracle Cure: How to Solve America’s Health Care Crisis and Why Canada Isn’t the Answer. Dr. Steffie Woolhandler, Associate Professor of Medicine at Harvard University, and co-founder of Physicians for a National Health Program.

Posted by pnhp at 11:50 AM | Permalink

Monopsony: A market situation in which the product or service of several
sellers is sought by only one buyer.
The American Heritage Dictionary of the English Language
http://www.bartleby.com/61/83/M0398300.html

The San Francisco Chronicle - October 11-15, 2004
IN CRITICAL CONDITION: HEALTH CARE IN AMERICA

This week, the San Francisco Chronicle has published an excellent series of articles on our health care system:

Why health care costs are rising fast. Plus the Bush and Kerry health care plans.
http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2004/10/11/MNGII96CVP1.DTL
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/10/11/MNGII96D031.DTL

Retirees hit hard as health benefits are lost.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/10/12/BUGMN979TS1.DTL

Health care tops the labor-management agenda.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/10/13/BUGMN97GRD1.DTL

How Canada provides health care for all.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/10/14/BUGR28JFEN59.DTL

Employees are digging deeper to pay for health insurance.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/10/15/BUG7T8E81H63.DTL

Don Bechler, Health Care for All - San Francisco, is compiling some talking points in response to this series, especially the article on the Canadian model.

This is my contribution:

Point:
There are major fundamental flaws in our health care system that cannot possibly be corrected by addressing each as an isolated problem. Comprehensive reform will be possible only by forming our own, universal, monopsonistic purchasing system, a single payer system.

Explanation:
Flaws include such factors as an irrational overpricing of certain services and products (e.g., pharmaceuticals), the excessive and expensive administrative burden placed on health care providers, the failure to provide greater incentives for a higher quality, lower cost primary care infrastructure, and the wasteful and detrimental excesses of high tech care in a system characterized by regional and selective excess capacities.

The last point is not receiving enough attention but is extremely important. It is timely now because Health Affairs has released a series of twenty articles on the topic. They can be downloaded for free, but only until October 21! After that time you will need to be a subscriber or will have to purchase each individual article to access them on the Internet.

The Health Affairs articles are listed under “7 October 2004” at:
http://content.healthaffairs.org/webexclusives/index.dtl?year=2004

We cannot possibly control costs and improve quality unless we harness the power of monopsonistic purchasing. And that just happens to have the added advantage of ensuring affordable, comprehensive coverage for everyone.

Don McCanne

Posted by pnhp at 09:29 AM | Permalink

On health, a clear choice between Bush, Kerry
October 17, 2004

The health care crisis is back. It’s a lively topic in the presidential campaign.

Eleven years after the Clintons introduced their super-complex plan to revamp health care, the problems of rising costs and increasing numbers of uninsured have only gotten worse.

More than 43 million citizens under the age of 65 do not have health insurance - up from 38 million a decade ago. And fewer employers provide health insurance plans at all. Four years ago, 65 percent of employers offered health plans. Today it’s 61 percent.

In addition, health care costs continue to skyrocket - well beyond the rate of inflation. Since 2001, premiums for family coverage have risen 59 percent, according to a recent Kaiser Family Foundation survey. That’s five times the rate of inflation and well above the increase in income for the average worker. For employers, it adds to the cost of doing business and discourages hiring new employees.

And the trends are ominous. Spending on health care now accounts for almost 15 percent of the nation’s gross domestic product - and rising. Japan and Great Britain spend 8 percent. And the United States has fallen behind other nations in significant measures of health. For instance, the infant mortality rate for black Americans is double the rate for whites and four times that for babies in Japan.

The health care proposals by President George W. Bush and his Democratic challenger, Sen. John Kerry, are dramatically different in type and scale.

While Kerry’s plan is far short of the scope of the Clinton administration’s proposal - and not a Big Government plan as Bush charges - it is ambitious and expensive. Kerry wants to cover 95 percent of the population; he estimates it would cost $653 billion over nine years. He would pay for it by rolling back the tax cuts for people earning more than $200,000 a year.

Kerry’s plan includes tax credits to small businesses to enroll in the federal employees health care system - a group of private plans. He would lower premiums by having the government re-insure for catastrophic coverage - the fastest growing aspect of health insurance. And he would extend government coverage to all children not covered.

Bush’s plan is far less ambitious. It basically involves offering health savings accounts that would allow individuals to deduct the costs of health insurance from their taxes. The major problem with his scheme is that middle-income and working-class families might not be able to afford to pay into the accounts.

It would certainly benefit the wealthy. And the Kaiser foundation estimates it would only reduce the uncovered rolls by 1.8 million.

Bush says Kerry’s plan would cost three times what Kerry estimates and require a tax increase. Maybe so. And the Kerry plan would be more effective in providing additional coverage than reducing medical costs. But Bush’s plan doesn’t meet the challenge of either rising costs or lack of coverage.

Inevitably, reducing costs will involve tough moral and ethical questions, the kind that politicians running for office aren’t willing to deal with. The nation has developed more medical technology than it can afford. The key issue in controlling costs will be: who gets what type of care, and when. That does imply rationing.

This much is clear: The next president will have to step up to these issues. In our view, the Kerry plan offers more hope for making progress.

Posted by pnhp at 03:36 PM | Permalink

By Paul B. Ginsburg, Ph.D.
The New England Journal of Medicine
October 14, 2004

In reality, there are four basic options for slowing the trends in health care spending: one can increase the efficiency of health care delivery; increase the financial incentives for patients to limit their use of medical services; increase the administrative controls on the use of these services; or limit the resources available to the health care system.

Government may be able to contribute to the efficiency of the health care system by supporting the development and installation of information technology to improve the coordination of patient care… Greater adherence to the practice of evidence-based medicine, additional research on the effectiveness of medical treatments, and greater assessment of technology before it is used outside research settings may all lead to gains in efficiency…

In recent years, employers have taken such steps as increasing deductibles in order to shift more costs to employees, giving them a financial incentive to use fewer services. Innovation is under way in this area: new benefit structures have been developed, including consumer-directed health plans, which typically have employer-funded spending accounts tied to insurance policies with a large annual deductible that exceeds the annual contribution to the account. Having patients share more costs can benefit consumers when it leads them to forgo care that has very limited benefits. But when the tools are used bluntly - as when they are applied equally to care that is deemed essential and care that is considered to be more discretionary - they can pose a barrier to important care or cause financial hardship for patients with low incomes or substantial medical needs.

An approach stressing administrative controls, relying on tools such as restrictive provider networks, prior authorization for services, and payment of providers on a capitated or episode basis, was used extensively by managed-care plans but proved highly unpopular.

Restricting the resources that go into the medical care system and the prices paid to providers is an approach that has been used extensively in Canada and Western Europe but has never gained much of a foothold in the United States. Attempts to regulate facility expansion and hospital rates were common in the United States during the 1970s but declined with the expansion of managed care and increased competition in medical care.

We can only hope that whoever is elected president will move beyond campaign-trail rhetoric and provide the leadership needed for a candid national discussion about health care costs. If not, we will find ourselves on a downward spiral, as more and more resources are used to pay for the health care of fewer and fewer Americans - a potentially intolerable situation.

http://content.nejm.org/cgi/content/full/351/16/1591

Comment: Quiz time. There are many ways to control health care costs. Regular readers of the Quote of the Day messages should be able to identify which measures will slow the growth of health care costs while ensuring that each patient will have affordable access to higher quality health care services, and which measures will slow the growth of costs by making care unaffordable to individuals with significant health care needs, while failing to direct our resources to care which is less costly but with better outcomes.

You have ten minutes to select the beneficial approaches and discard those that are detrimental. When finished, aggregate your answers and then share them with others as you initiate your own efforts at grassroots reform. Without your participation, reform won’t happen.

Posted by pnhp at 09:03 AM | Permalink

Employers’ Responses To A Play-Or-Pay Mandate: An Analysis Of California’s Health Insurance Act Of 2003
By Anna D. Sinaiko
Health Affairs - October 13, 2004

California, with 20 percent of its population uninsured and an unemployment rate of 6.2 percent, recently enacted the Health Insurance Act (known as SB 2), a play-or-pay employer mandate to expand health insurance coverage to a portion of the state’s working uninsured population. This law requires employers to either “play,” by providing employee health benefits that meet a minimum standard, or “pay” a fee to the state to cover workers under a state-sponsored program. Specific provisions of this program are still being determined. Although the law is scheduled to be phased in starting in 2006, a coalition of business groups is working to overturn it by referendum in November 2004.

With the passage of SB 2, California has brought the employer mandate back to the forefront of the health policy reform debate. Although state governments can mandate that employers provide coverage without committing public funds, someone must pay for the newly provided health insurance. In the best-case scenario, workers will value health insurance at more than its cost, and the combination of health insurance and lower wages will make workers better off without any adverse effects on employment or product prices. A more likely scenario is that some of the cost of health insurance will be passed to consumers, some felt by workers as unwelcome wage reductions, and some avoided by firms as they restructure their workforces. In California, workers at firms not offering benefits are more likely to be young males earning less than workers at firms that offer insurance; SB 2 will affect this group most adversely.

As employers restructure their workforces, fewer would-be-eligible workers will be offered health insurance. Although SB 2 will bring eligibility for health coverage to a portion of the uninsured in California, it will be lower than the estimated 1.07-1.56 million that researchers have projected. Moreover, because SB 2 does not include an individual mandate requiring workers to take up the coverage offered by their employers, some employees will decline employer-sponsored coverage, and fewer workers will be insured. This finding is not unique to California; similar results would be expected in other states.

http://content.healthaffairs.org/cgi/content/abstract/hlthaff.w4.469

Comment: Proposition 72, on California’s ballot next month, will allow voters to accept or reject SB 2, the play-or-pay employer mandate.

An employer mandate is the wrong solution to the problem of the uninsured. It reduces wages of those who were previously uninsured, with the greatest negative impact on lower income individuals. It perpetuates regressive tax policies in which higher income individuals receive a greater tax benefit than do lower income individuals. It threatens loss of employment as employers adjust hiring and work requirements to minimize the financial impact of the mandate. It results in higher prices which impairs competitiveness in national or international markets. In can result in adverse selection as decisions are made to avoid pools that concentrate higher cost individuals. Workers may decline coverage because of the consequential reduction in their take-home pay.

The problem that the voters face is that Proposition 72 is the only current, politically feasible proposal that will increase health care coverage. It would provide health insurance for close to one million of California’s six million uninsured. The single payer proposals, Kuehl’s SB 921 and Conyers’ HR 676, are locked in political limbo. And any promise of the presidential candidates for bona fide reform cannot become reality until the Congressional partisan rift is mended, a highly unlikely event in the next decade or two. The most realistically feasible approach would be to expand Medicaid and SCHIP, but that is highly unlikely until the deficit is reduced by tax increases, at a time when no politician would dare utter those words.

Although Proposition 72 is the wrong solution, it is the ONLY solution, at the right time and the right place. Californians need to approve it and then move on with our grassroots efforts to create the political feasibility for the adoption of a single payer system. If we work hard enough, maybe we won’t have to wait a decade or two for genuine reform.

Posted by pnhp at 08:49 AM | Permalink

Released by University Relations 12 October 2004
Contact: ISU Continuing Education and Conferences, 208-282-3155 or
800-753-4781.

Nationally Renowned Heath Experts
To Debate National Health Insurance at ISU

Pocatello - Should the United States have a national single-payer health insurance program?
That is the question that will be debated by two nationally renowned experts at 7 p.m. Oct. 21 at the Idaho State University Pond Student Union Building Salmon River Suite as a keynote address of the 17th annual Idaho Conference on Health Care.

The debate features Dr. Stephanie, an associate professor of medicine at Harvard and co-director of the Harvard Medical School General Internal Medicine Fellowship program, and Dr. Jane Orient, executive director of the Association of American Physicians and Surgeons (AAPS). “We pay too much for health care. More than any other industrialized nation, 78 percent more per capita than our nearest competitor Germany,” said Dr. William Woodhouse, physician, associate director of the ISU Family Practice Residency Program, and member of the health conference planning committee that organized the debate. “We can’t afford it. One in five Americans are uninsured and employers are increasingly unable to pay for employee health care and still stay competitive in the world market.

We don’t get what we pay for. Despite the huge cost we rank in the lower half or near last among industrialized countries for most commonly used health care quality outcomes.” Woolhandler and her organization, Physicians for a National Health Program, contend that a single payer national health insurance program is the answer to these problems.

Orient and her organization, the Association of American Physicians and Surgeons (AAPS), reject single payer national health insurance and assert that the answer lies in our current free-market system. “Both speakers are very strong, nationally-known proponents of their respective viewpoints. I expect a vigorous debate on this critical topic,” Woodhouse said.

Orient’s group, the AAPS, has been a voice for private physicians since 1943, and supports the sanctity of the patient-physician relationship, traditional medical ethics and free-market principles. Orient is a board-certified internist in solo private practice since 1980. She is author of the book “Your Doctor Is Not In: Healthy Skepticism about National Health Care.”

Woolhandler’s organization attempts to educate physicians, other health workers, and the general public on the need for a comprehensive, high-quality, publicly-funded health care program, equitably accessible to all residents of the United States. Equitable accessibility requires, in the view of PNHP, removal of the barriers to adequate health care currently faced by the uninsured, the poor, minority populations and immigrants, both documented and undocumented.

The debate is just one of many presentations of the health conference running Oct. 20-22 at ISU. On the theme “We Can Do Better,” this year’s conference will delve into a variety of topics presented by nationally recognized health care authorities. The event will feature health speakers on everything from the risks of fast foods to doping by athletes.”Once again, we have an extremely rich agenda with speakers who will address health issues relevant to all sectors of health care, including the general public,” said Dr. Linda Hatzenbuehler, Dean of the ISU Kasiska College of Health Professions. “We want to stress what a varied and informative Idaho Conference on Health Care we have planned this year. The constituencies including students, practicing professionals and the general public.”

The conference keynote addresses are open to the public, but registration fees are required for most conference events, including plenary speeches. Continuing education units are available to professionals desiring them. For more information on the conference or to register, contact the ISU Office of Continuing Education and Conferences, 800-753-4781 or 208-282-3155, or visit http://www.isu.edu/chp/hlthconf/.

###

ICHC Single payer events.
Thursday October 21, 2004

2:30 - ~4:30 PM: Reception / Activist work group
At home of Kellie and Bill Woodhouse, 1407
Juniper Hills Road*, Pocatello
Refreshments will be served
RSVP: Call Kellie at (208) 234-0973

7:00 - ~9:30 PM Idaho Conference on Health Care (see
www.isu.edu/chp/hlthconf for conference registration, accomodations, etc)
“Single Payer National Health Insurance - Is This the Answer?”
Steffie Woolhandler, MD (PNHP) vs Jane Orient, MD (Association of American Physicians and Surgeons)
This should be a very contentious debate. Both participants are very strong representatives of their viewpoints.
Salmon River Suite - Pond Student Union - Idaho State University

Friday October 22, 2004
9:45 - 10:45 AM “The HealthSystem Project”
Paul Ellwood, MD, Jackson Hole Group
Ballroom -Pond Student Union - Idaho State University

11:00 - 12:00 AM “We Can Do Better: The Future of the American Health Care System”

Panel discussion: Steffie Woolhandler, Jane Orient, Paul Ellwood
Clearwater Room - Pond Student Union - Idaho State University

Posted by pnhp at 03:59 PM | Permalink

During the past 18 months, the nine largest pharmaceutical companies have spent a greater percentage of their money on dividends for shareholders and on company stock buy-backs than they have spent on research and development, according to a Banc of America Securities analysis, USA Today reports. According to the study, the nine drug makers have returned about $56 billion to investors during the past six fiscal quarters. At Pfizer, the world’s largest pharmaceutical company, $22.2 billion was spent on stock buy-backs and dividends during that time period — about 210% the amount spent on R&D. Merck returned $7.3 billion, or 143% of R&D spending. Despite the amount of dividends for investors, share prices only grew by 5% during the study period. The study comes as rising prescription drug prices have made drug makers’ R&D expenditures “a political lightning rod,” according to USA Today. While the drug industry maintains higher U.S. prices are necessary to fund research of new drugs, critics say “the industry has plenty of money” for R&D and concentrates too much of its research on copycat drugs instead of innovative treatments, USA Today reports (Appleby, USA Today, 10/11).

Posted by pnhp at 11:48 AM | Permalink

U.S. Companies and Employees Continue to Struggle With Double-Digit Rate Increases
Hewitt Associates - Press Release
October 11, 2004

On average, Hewitt forecasts that companies will experience 2005 cost increases of 11.5 percent for health maintenance organization plans (HMOs), 10.5 percent for traditional indemnity plans, 11 percent for preferred provider organizations (PPOs) and 11.5 percent for point-of-service (POS) plans, with projected employee contribution increases of 15 percent across all plan types.

That means from 2004 to 2005, the average cost per person for major companies will increase from $6,519 to $7,269 for HMOs; $6,823 to $7,573 for PPOs; $7,192 to $8,019 for POS plans; and $6,793 to $7,506 for indemnity plans, according to Hewitt’s database of more than 2,000 health plans in 139 U.S. markets, including 300 major employers and more than 18 million health plan participants.

“While there are many different variables that factor into regional health care cost increases, one of the most powerful drivers is the level of consolidation in the market,” added (Hewitt’s national health care practice leader Jack) Bruner. “Plans and providers continue to merge in many cities, reducing the purchasing power and number of options available to employers.”

http://was4.hewitt.com/hewitt/resource/newsroom/pressrel/2004/10-11-04.htm

And…

Health costs to rise 11.3%, group says
By Kim Morris
Detroit Free Press
October 12, 2004

…costs are expected to increase between 8 and 12 percent in each of the next five years, said Jeff Nielson, senior benefits consultant in Hewitt Associates’ Detroit office.

http://www.freep.com/money/business/ebenes12e_20041012.htm

Comment:
According to Hewitt, market consolidation has reduced the impact of competitive pricing resulting in higher health plan premiums, and there is no relief in sight. Private marketplace plans continue to prove that they are not capable of controlling health care costs.

It’s time to replace our highly flawed, fragmented system of funding care with our own monopsonistic, single payer purchaser. That’s the only way that we are going to get the level of health care spending right, both for patients and for health care providers.

Posted by pnhp at 08:37 AM | Permalink

National Committee for Quality Assurance (NCQA)
The State of Health Care Quality - 2004

From the Introduction:
NCQA is pleased to present its 2004 State of Health Care Quality report. This is the eighth such report NCQA has produced, and the fifth report in a row to find that performance on key measures of clinical quality has improved over the past year. For the 69 million people enrolled in the health plans that provided their performance data to help NCQA prepare this report, this trend is very good news; they can expect better care and better health outcomes.

But what of the rest of the health care system?

What of those with little or no access to care such as the 45 million people without health insurance? What of those who receive care through health plans that do not publicly report their performance? Using conservative estimates, this report finds that the performance of the rest of the system leaves much to be desired. Huge “quality gaps” exist, costing tens of thousands of lives, millions of illnesses and billions of dollars annually.

From the Summary:
Despite evidence of promising gains in certain sectors of the health care system, once again this year NCQA documented evidence of widespread, unexplained variation in quality that results in thousands of unnecessary deaths, tens of thousands of avoidable hospitalizations and illnesses and billions of dollars in lost productivity-hobbling an economy already encumbered by the ever-growing costs of health insurance.

Even as adherence to evidence-based care has improved in many health plans, there is cause for great concern that these gains could be erased in the years ahead. The trend toward PPOs and CDHPs, while holding great promise in terms of consumer engagement and harnessing of the Internet’s power, also relies more on patient decision making and less on aggressive care coordination.

http://www.ncqa.org/Communications/SOMC/SOHC2004.pdf

Comment: The abysmal quality of health care for the uninsured has been well documented. And it is no surprise that quality can be improved for those individuals who have comprehensive health care coverage. Clearly we need to enact changes that would ensure that everyone has comprehensive health care coverage.

What should alarm us about this report is the current trend in health care coverage. Because there is more flexibility in the design of PPOs (preferred provider organizations), premiums can be made more affordable by shifting costs to the beneficiary-patient. Also, the CDHPs (consumer-directed health plans) are designed to make patients more responsible health care shoppers by exposing them to higher out-of-pocket expenses. But as the NCQA report indicates, this trend places a greater emphasis on patient decision making at the cost of deemphasizing aggressive care coordination.

The great news about the NCQA report is that aggressive care coordination does improve quality outcomes. The NCQA report describes approaches to improve the identification of better outcomes through improved care coordination. A carefully designed system can be used to reward higher quality care. But PPOs and CDHPs, by shifting the direct spending decisions to the patient-consumer, also shift the responsibility for identifying quality to the patient. But our current fragmented system does not have the capability of providing readily accessible, easily understood data on quality variation. And limiting choice to health plans reduces the patient’s ability to have the more important choice of actual health care providers.

A single, universal system with truly comprehensive benefits would provide an infrastructure that would enable the promotion of inducements that would encourage aggressive care coordination. We have enough data already to know what would happen with a greater shift to CHDPs and PPOs. We do not need another decade of health policy experimentation ending with the inevitable impaired outcomes.

We also have enough data to know what a universal, comprehensive system would bring. Even the special interests opposing reform understand the vast superiority of the single payer model. So why do we continue to listen to and follow their rhetoric designed to protect their own interests? As we continue to postpone the inevitable, we are perpetuating suffering and death. The blood is on the hands of those who fail to act.

Posted by pnhp at 08:56 AM | Permalink

Marty Calon, RPh, of Baltimore, Maryland, responds to the critique of Wisconsin’s program to reduce drug costs for state employees:
I usually couldn’t agree more with your comments, but I have to disagree with some of what you say here. I am a pharmacist with long experience in the Department of Veterans Affairs with these prescription practices.

As long as drug companies persist in pricing by dose, whereby a 5mg tablet and a 10mg tablet cost the same, splitting tablets is a viable option, as long as it is not done without controls. The drugs which are suitable for splitting must be specified and selected, on the basis of (in order of priority) suitability for splitting (physically and clinically), cost, and amount of usage (no point in requiring splitting of drugs which are rarely prescribed).

Specifically, there has to be good clinical judgment or clinical evidence that the particular medication and dosage form is suitable for splitting, and there has to be a liberal exception mechanism for patients who cannot or do not wish to deal with the splitting. The splitting program also should be monitored to ensure that the drug therapy with the split tablets is producing the desired results, although this monitoring should be happening regardless of tablet splitting.

For example, SSRIs and sildenafil (Viagra) are ideally suited to splitting. It doesn’t even matter if the dose is not precisely divided, because the exact dose is simply not very important, which is true for many drugs. In the case of SSRIs, which have a long-term effect, it’s just about irrelevant whether the patient gets his precise dose every day; cumulatively, he’ll get the right dose unless the tablet is falling apart. Warfarin is a drug that probably should not be split if possible. Pharmacists have a good understanding of the physical composition of the tablets (coatings, sustained-release mechanism, etc) and their pharmacokinetic parameters to determine their suitability for splitting.

Many physicians don’t have the knowledge, cost information, or motivation to prescribe generically. The majority of medications that are available generically do just fine if the pharmacist selects reputable generic vendors. The handful of notable exceptions (warfarin, theophylline SR, phenytoin, etc) are the only ones that need be limited to brand-specific prescribing. Pharmacists are well-qualified to make these judgments and advise physicians and patients on generic substitution, especially as they have the cost and legal equivalence information that is often not disclosed to physicians.

One more point: Rational selection of the most cost-effective medication, and controlled and monitored therapeutic substitution, again with appropriate exception mechanisms, are even more effective ways to save money. Think of all the people who are taking expensive antibiotics for trivial infections (if they need them at all), and the patients who take expensive “non-sedating” antihistamines and unnecessary COX-2 inhibitors, because they are so heavily promoted. And let’s not even start with all the patients taking medications that they don’t need at all.

I agree that these are not long-term or ideal solutions, and I make no apologies for the so-called “Pharmacy Benefit Managers”, but—properly implemented—they are appropriate responses to the current realities of medication prescribing and its costs.

Don’s response:
I emphatically agree with Marty Calon’s comments. They are certainly applicable to the real world of today, although we would hope might be modified eventually to apply to the ideal world which we envision.

One point that I failed to make was to acknowledge the crucial role that the pharmacist plays as part of the medical team. And I want to emphasize that the role to which I refer is as a health care professional who assists the patient and his or her practitioner in matters regarding drug therapy. This is in sharp contrast to a pharmacy benefit manager (PBM) that is primarily a middleman working the system to maximize profits for the PBM organization. Pharmacists must always be an integral part of the professional medical team.

The other point that I want to reemphasize is that we need fundamental structural changes that will improve access and affordability of prescription drugs. The pharmacist’s role should be to assist with the selection of the most appropriate drugs that also offer the best value. As the paper by Dean Baker demonstrates (a “quote” last week), we need to revise the drug patent system to provide incentives for better value in drugs. But also, we need to use negotiated purchasing that would also eliminate gimmickry designed to enhance profits. And we need to place the pharmacist in a position of being rewarded for applying his or her professional skills, rather than being placed in a subservient role of enhancing the success of a PBM business entity.

Posted by pnhp at 09:05 AM | Permalink

Embargo for Oct. 7
For more information:Larry Rubin 202-955-1250

Labor, Business, Medical Leaders Launch America’s Agenda: Health Care for All, Aiming To “Break the Insurance Lobby Choke-hold on Health Care”

WASHINGTON, DC, October 7 — “There will be no health care for all Americans until our political leaders are willing to take on a health insurance industry that showers them with cash,” said Douglas Dority today as he announced the launching of America’s Agenda: Health Care for All. “Insurers have proven time and time again they will spend whatever it takes to perpetuate a system of financing that makes them wealthy while restricting care only to those who can afford it.”

Dority, chair of the new organization that will help grassroots groups fighting for universal health care, is the former president of the United Food and Commercial Workers union (UFCW). He was joined by other union leaders, and by health care reform advocates from the business and medical communities and from Capitol Hill.

“The insurance companies with their scandalous profit-taking deny access to care to even those with insurance by practices of excluding pre-existing conditions, complex paperwork and uncovered benefits,” said Dr. Claudia Fegan, president of the Physicians for a National Health Program (PNHP). “Over 12,000 physicians support a national health insurance program that will cover everyone with the money we would save from the administrative waste of our current system.”

U.S. Rep. Tammy Baldwin (D-WI) said “it is time to put ‘health care for all’ at the top of our national agenda.” She has introduced a bill that would give federal funding to states that institute programs expanding access to health care. Rep. Baldwin and Dr. Fegan have agreed to serve on the Advisory Committee for America’s Agenda.

“Our medical system is dysfunctional and bad not just for our health, but for our entire economy,” said Bernard Rapoport, founder and former CEO of the American Income Life Insurance Company. Rapoport, a member of the America’s Agenda governing board, said “soaring costs are undermining the competitiveness of American business in the global economy. The U.S. is the only country in the industrialized world that doesn’t have publicly-financed health insurance, so American companies are burdened with expenses others don’t have, endangering our manufacturing base.” As examples, he cited Ford Motor Co. that spends $3.2 billion a year on health premiums and General Motors that spends more on health than on steel.

“The American people are fed up,” said Dority. “Poll after poll shows they want affordable health care that covers everyone. Why don’t we have it? Because America’s health insurance industry does everything in its power to block it . The current system may be a shambles, but it is a profitable shambles for those who run it.”

Joe Hansen, Dority’s successor as UFCW president and an America’s Agenda board member, renewed the union’s commitment to universal health care. “No one union, no one company, has a solution for the health care crisis,” said Hansen. “It has to be a political solution.”

“Out of control health care costs are a huge problem not just for workers but for employers who have health care plans,” said Marty Maddaloni, general president of the United Association of Plumbers and Pipefitters. “It puts these employers at a competitive disadvantage with those who do not have such plans.”

“I can think of no economic issue that impacts all working families in America more than the growing health care crisis,” added Morty Bahr, president of the Communications Workers of America. “It is criminal that 45 million Americans are without any health insurance and that number is projected to go to more than 51 million in 2006.” Both Bahr and Maddaloni serve on the governing board of America’s Agenda.

Dority noted that in recent years concerned citizens from Massachusetts to New Mexico have waged statewide campaigns for universal coverage. Additionally, health care reform initiatives and legislative hearings are progressing in several states, “but the industry continues to spend astronomical amounts of money to defeat them.”

Health insurers all across the nation have come together to create America’s Health Insurance Plans (AHIP) to lobby for the status quo. AHIP will run a multi-million dollar campaign with offices in 46 different states. “In the recent past, effort after effort by state-level grassroots groups to reform our broken health care system has been defeated by the well-heeled health insurance lobby,” Dority said. “We intend to help level the playing field. We must break the insurance lobby choke-hold on U.S. health care.”

To support grassroots groups, Dority said that America’s Agenda: Healthcare for All will utilize TV, radio, print media and the Internet to mount creative and coordinated “truth campaigns”. Business leaders, physicians, elected officials, labor leaders and universal health care campaign activists will be effective “messengers of truth” about the costs and benefits of specific health reform proposals.
“We will counter the insurance lobbyists by taking the truth to the American people,” said Dority.

Until recently, Dority was president of the United Food & Commercial Workers (UFCW), a union whose members have been in the forefront of the battle to protect health benefits on the job. This past winter, tens of thousands of grocery workers were forced into bitter strikes in California, Ohio, Kentucky and West Virginia, in an effort to hold the line for workers across the nation whose health benefits were under attack. Dority didn’t blame the employers— he blamed the system. In March, he announced he was stepping down at UFCW “to devote my energies to a new effort to convince our political leaders that health care for all Americans is long overdue.”

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Please click here to view the pdf

Posted by pnhp at 12:21 PM | Permalink

Wisconsin State Journal
October 4, 2004

Wisconsin’s success in holding down costs in the state’s group health insurance plans offers lessons for other governments and the private sector.

The results of the strategy the state is using are nothing short of stunning. The average cost for state employee health insurance next year will rise only 5 percent, roughly half of earlier projections.

…the state’s accomplishment shines a spotlight on a part of the health care system called pharmacy benefits management.

Pharmacy benefits managers administer prescription drug insurance benefits.

However, not all pharmacy benefits managers are created equal. Many governments and businesses get stuck with poor pharmacy benefits management because they leave the job to health maintenance organizations or they look for the benefits manager who charges the lowest fee for the job.

…Wisconsin’s state government has taken the job away from HMOs in the state insurance plans and contracted with a single benefits manager, Navitus, based in Appleton and Madison. Navitus is a joint venture of Dean Health Plan and Touchpoint Health Plan.

…Navitus focuses on truly controlling costs. It has encouraged the use of generic drugs by waiving co-payments for the first filling of a generic prescription. It has boosted the use of mail-order drugs, and it has encouraged savings by pill-splitting, a technique that allows a consumer to buy a double-dose pill and split it in two to get the required dose cheaper.

Because of the way it does business, Navitus charges a higher fee than managers who dip into rebates or use other means to profit at consumers’ expense. But the fee is proving to be more than worth its cost because of the savings gained by the improved management.

http://www.madison.com/wsj/home/opinion/index.php?ntid=11732&ntpid=0

Comment: First, a comment about pill splitting. The marginal cost of producing most medications is negligible. Pharmaceutical firms frequently price their products based on a day’s dosage rather than the milligram amount. A 5 mg tablet may be the daily dose for one individual and a 10 mg tablet for another. The pharmaceutical firm may decide that this treatment should be priced at $90 per month or $3 per day. Thus both the 5 mg and 10 mg tablet may be priced at $3 each. It is obvious why pill splitting has become a common practice. But it has been condemned because of possible dosing errors due to crumbling pills or perhaps absorption differences due to disruption of the pill coating. We do need much more rational drug pricing policies, but we don’t need middlemen recommending unacceptable, potentially dangerous, cost saving practices.

Choosing a generic equivalent over a brand name drug may be a wise decision if the products are truly comparable, but that should be a clinical decision and not one based on paying the patient a bribe to make the switch (waiving the co-payment at the time a decision to offer the generic is made by the pharmacy benefit manager rather by than the physician).

Also, a rational system of drug pricing would not delay access to necessary prescriptions, a process which reduces patient compliance, by offering discounts for mail delivery.

But what is especially outrageous here is that the state of Wisconsin is rewarding Navitus above-market fees for having adopted policies that are detrimental to the health of their employees.

A universal, publicly funded and publicly administered health insurance program would ensure that medications would be available in the right amount, at the right time, in the right place, and that negotiated pricing would ensure that they would remain affordable for all of us.

Again, is there something about rational reform that our policymakers don’t understand?

Posted by pnhp at 08:58 AM | Permalink

Anthem, UnitedHealth, Wellpoint Pay CEO Fortunes: Graef Crystal

Oct. 6 (Bloomberg)

While 45 million Americans don’t have health insurance, the chief executive officers of the major companies that provide health coverage to much of the nation are munificently paid.

Among 12 U.S. health insurers, all with 2003 net sales of $1 billion or more, the median and average total pay came to $9 million and $15.2 million, respectively.

At the top of the compensation ladder are Anthem Inc.’s Larry Glasscock, UnitedHealth Group Inc.’s William McGuire and WellPoint Health Networks Inc.’s Leonard Schaeffer. Their respective 2003 total pay amounted to $50.9 million, $30 million and $27.4 million. To get to the fourth-most-highly-paid CEO — Aetna Inc.’s John Rowe — you would have to drop down to $16.2 million.

(Total pay consists of the sum of base salary; annual bonus; my estimate of the present value of stock options granted in 2003 and valued at the date of grant using the Black-Scholes model; the value at grant of free share awards made in 2003; payouts in 2003 under other forms of long- term incentive compensation; and miscellaneous compensation. Data for this study were obtained from Aon Consulting’s eComp database.)

What’s going on here is an extremely heavy emphasis on rewarding for size of net sales. UnitedHealth, WellPoint and Anthem occupy, respectively, the first, second and fourth slots on the net sales rankings, while Aetna came in third.

What About Performance?

Too bad the boards of these companies didn’t place more emphasis on performance, or for that matter, any emphasis at all.

The average 2003 revenue of the three highest-paid health-care executives was $22 billion, while their average total return for the single year ended Dec. 31, 2003, was 31.6 percent. For that, the three CEOs received average pay of $36 million each. Indeed, Glasscock produced the lowest total return of the group of 12, yet he earned the highest pay by far.

Yet the three best performers in terms of total return last year were none of the above. They were PacifiCare Health Systems Inc. (total return of 140.6 percent); Sierra Health Services Inc. (128.6 percent) and Humana Inc. (128.5 percent). For those magnificent performances, the three CEOs averaged $6.8 million apiece, a figure that was just 19 percent of the pay of their much bigger brothers.

Bigger Is Better

Face it, we Americans have a fixation with size. We boast about our buildings, our gross national product and our huge weaponry. Bigger is better. It seems never to have dawned on those worthies who sit on boards of directors that maybe there’s a different, more compelling mantra they should be reciting: Better performing is better.

Let’s focus more closely on Glasscock’s 2003 pay package of $50.9 million. Included in that amount was a long-term cash payment of $21.2 million, along with free shares valued at the same $21.2 million.

Anthem pointed out that the $42.4 million total was generated, not by Glasscock’s performance in 2003, but rather for his performance in the years 2001 through 2003.

It’s certainly correct that 2003 was an unusually good year for Glasscock. Still, don’t cry about his meager pay in earlier years because for 2001 through 2003, he still averaged a princely $26.3 million annually in remuneration, just a tiny bit behind McGuire’s $27.1 million. Not so for his company’s three-year average net sales, which were 48 percent lower than those of UnitedHealth.

Read the Footnote

In its proxy filed in 2002 and covering the year 2001, Anthem, following disclosure rules promulgated by the U.S. Securities and Exchange Commission, informed shareholders that Glasscock had been given the opportunity to earn $4.1 million for “target” performance in the years 2001 through 2003.

It also said his “threshold” payout — below which the next stop is zero — would be $2 million. The company went on to declare that whatever Glasscock earned at the end of the three-year performance period would be predicated on “specific strategic objectives such as growth in net income, operating margin and comparison of performance against peer companies.”

Those same proxy disclosure rules also require a company to tell shareholders what the maximum payout would be under any long-term incentive grant — the payout for hitting all the bases. Yet there was no maximum column in the case of Anthem’s long-term incentive table included in its proxy. Instead, there was a footnote.

If you were a shareholder at Anthem at the time, you might have missed that footnote. Nonetheless, it stated, quite plainly, that “Under the LTIP (long-term incentive plan), there is no maximum limitation.”

Some Understatement

That sure turned out to be an understatement. With his ultimate payout of $42.4 million, Glasscock ended up earning 10.5 times his target award.

Anthem’s income statement did look fabulous during the three-year period. Yet its total return of 23.1 percent a year for the two years ended Dec. 31, 2003, ranked it only ninth among the companies in the study whose stock had been publicly traded for at least two years. (A three-year total return couldn’t be computed because Anthem didn’t go public until Oct. 29, 2001.)

Exhibiting more prudence this time out, Anthem told its shareholders in its 2004-filed proxy that, under a new long-term incentive grant, there wouldn’t be just threshold-award and target levels, but also a maximum-award one.

The imposition of a maximum-award level demonstrates what the lawyers call “consciousness of guilt” on the part of Anthem’s board compensation committee.

Cake or Crumbs?

Glasscock and Schaeffer are trying to merge their two companies. Both have been high-performers. When I look at the pay of the two CEOs and consider that each company has a long tradition of rich compensation, I begin to wonder if the shareholders of the combined company will be eating cake — or just crumbs on the cake plate.

Below is a table showing for each of the 12 CEOs in the study the company’s total return for the single year ended Dec. 31, 2003, the 2003 total pay of the CEO and the percentage by which that pay was higher or lower than a hypothetical “going rate” of pay adjusted for the relative size of the company.

Company / CEO / 1-Year Return / 2003 Pay (millions) /Above or Below Market
Anthem Inc. / Larry Glasscock / 19% / $50.9 / 138%
Coventry Health / Allen Wise / 122% / $14.6 / 81%
Wellpoint Health / Leonard Schaeffer / 36% / $27.4 / 11%
Sierra Health / Anthony Marlon / 129% / $3.6 / 2%
UnitedHealth Grp. / William McGuire / 39% / $30.0 / -6%
Amerigroup Corp. / Jeffrey McWaters / 41% / $2.9 / -21%
Wellchoice Inc. / Michael Stocker / 44% / $6.9 / -24%
Aetna Inc. / John Rowe / 64% / $16.2 / -28%
Pacificare Health / Howard Phanstiel / 141% / $10.2 / -35%
Oxford Health / Charles Berg / 19% / $5.4 / -41%
Health Net Inc. / Jay Gellert / 24% / $7.9 / -50%
Humana Inc. / Michael McCallister / 129% / $6.6 / -61%

Low / 19% / $2.9 / -61%
Median / 42% / $9.0 / -23%
Average / 67% / $15.2 / -3%
High / 141% / $50.9 / 138%

To contact the writer of this column:
Graef Crystal in San Diego at graefc@bloomberg.net.

To contact the editor responsible for this column:
Bill Ahearn at bahearn@bloomberg.net.

Posted by pnhp at 10:07 AM | Permalink

From the Oct. 11, 2004 issue of TIME magazine
Viewpoint / Health

Americans are burdened with a costly, hugely dysfunctional health-care system. In a new book, a pair of investigative reporters offers a fresh remedy based on a successful model we’re all familiar with.
By Donald L. Barlett; James B. Steele

This is the picture of health care in America. We spend more money than anyone else in the world — and yet have less to show for it than other developed countries. That’s one reason we don’t live as long. We don’t adequately cover half the population. We encourage hospitals and doctors to perform unnecessary medical procedures on people who don’t need them, while denying procedures to those who do. We charge the poor far more for medical services than we do the rich. We force senior citizens with modest incomes to board buses to Canada to buy drugs they can’t afford in America. We clog our emergency rooms with patients because they can’t get in to see their doctors. We spend more money treating disease than preventing it. We are victims of rampant fraud and overbilling. We stand a good chance of dying from a mistake if we are admitted to a hospital, and we kill more people with prescription drugs than with street drugs like cocaine and heroin. We have an endless choice of health-care plans, but most people have few real choices. We are forced to hold bake sales, car washes and pancake breakfasts to pay the medical bills of family members and friends when a catastrophic illness strikes.

Americans tend to believe they have the best health care in the world, but in truth it is a second-rate system and destined to get a lot worse and much more expensive.

It need not be this way.

The simplest and most cost-effective remedy is one that is considered untouchable in the U.S. because of the huge lobbying forces arrayed against it. Indeed, neither presidential candidate has come close to offering such a comprehensive solution. The remedy: provide universal coverage and create one agency to collect medical fees and pay claims. This would eliminate the staggering overlap, bureaucracy and waste created by thousands of individual plans. Under a single-payer system, all health-care providers — doctors, hospitals, clinics — would bill one agency for their services and would be reimbursed by the same agency. Every American would receive basic health care, including essential prescription drugs and rehabilitative care. Anyone who needed to be treated or hospitalized could receive medical care without having to wrestle with referrals and without fear of financial ruin.

Radical? We already have universal health care and a single-payer system for everybody age 65 and over: it’s called Medicare. For years, researchers and health-care professionals have advocated a similar plan for the rest of the population, but no plan has ever got far in the legislative process because of fierce opposition by the health-care industry. To discredit the single-payer idea, insurers, HMOs, for-profit hospitals and other private interests play on Americans’ long-standing fears of Big Government. In truth, it is the private market that has created a massive bureaucracy, one that dwarfs the size and costs of Medicare, the most efficiently run health-insurance program in the U.S. in terms of administrative costs. Medicare’s overhead averages about 2% a year. In a 2002 study for the state of Maine, Mathematica Policy Research Inc. concluded that administrative costs of private insurers in the state ranged from 12% to more than 30%. That isn’t surprising because unlike Medicare, which relies on economies of scale and standardized universal coverage, private insurance is built on bewildering layers of plans and providers that require a costly bureaucracy to administer, much of which is geared toward denying claims.

What kind of agency would administer this Medicare-like plan for the rest of us?

The idea of a single-payer plan run by the U.S. government carries with it far too much political baggage to ever get off the ground. What’s needed is a fresh approach, a new organization that is independent and free from politics. For in addition to covering the basic costs of all Americans, a new system would need to institute programs to improve America’s overall health that focus on preventing illness and disease as well as on treatment and do so without breaking the bank. How does the U.S. come up with such a mechanism?

One possible answer: loosely copy and then expand on what already exists in another setting — the Federal Reserve System, which oversees the nation’s money and banking policies. The Fed is one of America’s most ingenious creations, a public agency that is largely independent of politics. The Fed’s board members are appointed to 14-year terms by the President with the consent of the Senate, meaning that neither the White House nor Congress can substantively influence the Fed’s policies.

Call this independent agency the U.S. Council on Health Care (USCHC). Like the Fed, the council would set overall policy for health care and influence its direction by controlling federal spending — from managing research grants to providing medical coverage for all citizens. Unlike the Fed, it would be funded by taxpayers. The money could come from two taxes: a gross-receipts levy on businesses and a flat tax, as with Medicare, on all individual income, not just wages.

This would not represent an additional cost to society but would rather replace existing taxes and write-offs. It would cut costs for corporations and raise taxes slightly on individuals at the top of the income ladder. The council’s mission: implement policies that improve health care for everyone, not just those suffering from certain diseases. In short, make the unpopular decisions that the market cannot make. The council could establish regions similar to those of the Fed.

The geographic subdivisions could take into account cultural and regional differences. That would allow for health-care delivery to be fine-tuned at the local level and ensure that regulations take into account the differences between metropolitan and community hospitals. That is not to suggest that a single-payer system overseen by a Fed-like independent organization would instantly correct everything that’s wrong with market-driven health care. What it would do is provide the framework to reach that goal. For starters, it would:

Guarantee that all Americans receive a defined level of basic care, including a fixed number of visits to doctors, routine lab work, immunizations for children, coverage for all childhood illnesses and all hospital charges.

Establish flexible co-pays for basic care that would vary depending on income as well as usage. Those people who seldom seek medical attention could have their co-pays waived. So too could those at the bottom of the income ladder.

Pay all costs to treat any catastrophic illness, such as cancer and other devastating diseases.

Restore freedom of choice by allowing patients to choose their doctors and their hospitals.

Redirect health-care spending by allocating money for disease prevention as well as treatment.

Provide critically important drug information to consumers to balance the promotional hype of advertising.

Concentrate health-care spending on cost-effective areas, such as stemming the increased prevalence of diabetes in children.

Halt the existing practice by which insurers squeeze doctors through unrealistically low reimbursement rates. The same for hospitals and nursing homes that squeeze nursing salaries and staffing levels.

Reverse the costly but seldom discussed health-care trend of overdiagnosis and overtreatment — something no market system will ever do. While many Americans suffer from a lack of health care, a growing number get too much.

Once the basic care package is in place, its scope could be expanded as the system realizes savings derived from standardization, more efficient computer technology and the end of market-based health-care management, with its required profits, stock options and generous executive compensation.

Individuals could supplement their basic government-supported coverage through private insurance. Wealthier citizens could continue to get whatever care they wanted and pay for it. But they would still be required to pay the earmarked taxes, just as everyone must contribute to Medicare and Social Security. Similarly, hospitals would be free to accept a certain percentage of cash-paying patients from outside the USCHC plan. As for prescription drugs, a good health-care system would strive to prescribe fewer pills, especially since the effectiveness of many drugs is questionable. The USCHC could negotiate the best possible drug prices, something that Medicare is forbidden to do by Congress.

Many Americans fear that a universal health plan would cost too much, even though the market system has already given the U.S. the world’s most expensive health care. They fear the long waits they have heard about in Canada, even though comparable waiting times for tests and procedures are commonplace in many parts of the U.S. Lastly, they fear government-decreed rationing, even though health care is already rationed in the most inequitable of ways.

Despite all the fears, change will come, ultimately from two sources: working Americans who are disenchanted with ever rising costs and shrinking care, and U.S. corporations, which are increasingly refusing to pick up the added costs. They can’t afford to, because America’s privately funded system puts U.S. companies at a disadvantage to their competitors in the industrialized world, where health care is funded by government. GM says the cost of providing health care to its workers and retirees totals $1,400 for each vehicle sold in the U.S., more than the cost of steel.

America’s health-care system is in critical condition, and we find ourselves at a turning point. We can continue to hold bake sales to finance it, or we can do what every other civilized nation on earth does — take care of our citizens.

Posted by pnhp at 09:43 AM | Permalink

Perspective: By John E. Wennberg
Health Affairs
October 7, 2004

Several papers in this Health Affairs collection show once again that unwarranted variation-variation not explained by illness, patient preference, or the dictates of evidence-based medicine-is a ubiquitous feature of U.S. health care. As shown in several of these papers, health care systems fail to provide in full measure such simple life-saving, morbidity-sparing interventions as immunizations, diabetic glucose monitoring, and the use of drugs for those with heart attacks. Every region and every state exhibits underuse of effective care, some more so than others. James Weinstein and his colleagues provide further evidence that the incidence of discretionary surgery, the use of which should depend on patient preference, is unduly influenced by local physician opinion, which has resulted in striking long-term variation in the risk of surgery among local regions-the “surgical signature” phenomenon. Elliott Fisher and his colleagues show that among the chronically ill, the frequency of physician visits, diagnostic testing, and hospitalization and the chances of being admitted to an intensive care unit (ICU) depend largely on where patients live and the health care system they routinely use, independent of the illness they have or its severity. Katherine Baicker and her colleagues show that variation affects minority groups as it does white Americans, which clouds the interpretation of racial and ethnic disparities based on national average rates.

While noting that the U.S. supply of physicians grew remarkably over the past twenty years, David Goodman shows that growth in aggregate supply does not “cure” variations: In 1999 the per capita supply of generalist physicians varied more than twofold and that of medical specialists more than fivefold among regions. I and my colleagues document that Medicare spending varies more than twofold among regions, but more spending is not associated with better quality, as measured by reduced underuse of effective care, or, surprisingly, with more major surgery. Greater per capita spending buys more intensive intervention among patients with chronic illness: Those who live in high-cost regions experience more visits to medical specialists, tests, hospitalizations, and ICU stays than their counterparts living in low-cost regions. And because of the way Medicare is financed, regions with low costs end up subsidizing a sizable proportion of the care for those living in high-cost regions.

The irony, as Fisher and his colleagues show, is that patients with similar chronic illnesses who live in high-cost regions, including those who receive most of their care from prominent academic medical centers (AMCs), do not have better health care outcomes than patients living in low-cost regions. In other words, the patterns of practice in managing chronic illness in low-cost regions do not appear to result in the withholding of valuable care (health care rationing); rather, systems of care serving high-cost regions are inefficient because they are wasting resources.

Three needed reforms:

First, the quality agenda must be extended beyond effective care; the agenda should also address unwarranted variation in preference-sensitive treatments such as discretionary surgery and the overuse of physician and acute care hospital services in managing chronic illness.

Second, reform of the payment system must be undertaken to enable providers to deal with the complicated and interrelated financial, organizational, and behavioral issues that need to be resolved if the quality of patient decision making is to be improved and inefficiencies and waste in the treatment of chronic illness remedied.

Third, AMCs and the National Institutes of Health (NIH) must respond to the glaring weaknesses in the scientific basis for clinical decision making by undertaking the systematic evaluation of the everyday practices of medicine.

http://content.healthaffairs.org/cgi/content/full/hlthaff.var.140/DC2

Editor’s Note
John K. Iglehart

Thirty-one years ago, researchers Jack Wennberg and Alan Gittelsohn began what has become a long odyssey to better understand the distinctive variations in clinical practice patterns that characterize medical care in the United States. By publishing their landmark paper in Science (14 December 1973), they launched a new chapter of health services research in relation to clinical care. In 1984 the editors of Health Affairs, struck by how resistant providers and patients were to addressing unwarranted practice variation, devoted a thematic issue to the subject (Summer 1984). Fast forward to today, and one can only marvel at how little variations that are unexplained by, as Wennberg notes, “illness, patient preference, or the dictates of evidence-based medicine” have been reduced.

With the publication of these papers, Health Affairs is once again lending its voice to the dialogue on variations. But for several reasons, this time the opportunities for real change seem more promising. First, Wennberg and his colleagues at Dartmouth Medical School have developed methods to link the practice variations with specific hospitals and physicians, and they plan to make provider-specific information available as part of the Dartmouth Atlas of Health Care project. As they note, provider-specific information can be used to identify efficient providers within a given region and should prove useful in configuring provider networks. Second, the opportunity to use this information to guide improvement is reinforced by the work of Elliott Fisher and colleagues, which shows that the problem of variation in intensity of treatment for chronic illness is primarily a problem of overuse and waste, not underuse and health care rationing. Third, as discussed in several papers, the puzzling problem of geographic variation in elective surgery is better understood and the value of shared physician-patient decision making, more firmly established. And fourth, the critical importance of creating economic incentives to reward providers who reduce unwarranted variation and the need for Medicare to assume greater leadership is increasingly recognized by payers and Congress alike. In the November/December 2003 issue of Health Affairs, fifteen prominent health policy figures, including Wennberg, signed an open letter to the Centers for Medicare and Medicaid Services (CMS) urging Medicare to assume more aggressive leadership in the “pay for performance” effort.

http://content.healthaffairs.org/cgi/content/full/hlthaff.var.3/DC2

For the index to the twenty articles on variations in clinical practice patterns (web exclusive for 7 October 2004): http://content.healthaffairs.org/webexclusives/index.dtl?year=2004

Comment:
In many of the papers, suggestions are made as to how Medicare reform might facilitate many of the improvements needed in resource allocation that would correct the waste and inadequacies demonstrated by the variations in clinical practice patterns. But improving Medicare alone would not be adequate to correct systemic problems such as capacity variations of academic medical centers or variations in the physician work force.

If Medicare were the only source of funding health care in the United States, then it could use its monopsonistic power to reduce perverse variations in clinical practice patterns. That would provide us all with better value for our health care investment. But it is unlikely that we’ll see that value until we do take control of health care funding through a single payer, national health program.

Posted by pnhp at 09:02 AM | Permalink

Labor, Business, Medical Leaders Launch America’s Agenda: Health Care for All, Aiming To “Break the Insurance Lobby Choke-hold on Health Care”

Embargo for Oct. 7
For more information:
Larry Rubin 202-955-1250

WASHINGTON, DC, October 7 — “There will be no health care for all Americans until our political leaders are willing to take on a health insurance industry that showers them with cash,” said Douglas Dority today as he announced the launching of America’s Agenda: Health Care for All. “Insurers have proven time and time again they will spend whatever it takes to perpetuate a system of financing that makes them wealthy while restricting care only to those who can afford it.”

Dority, chair of the new organization that will help grassroots groups fighting for universal health care, is the former president of the United Food and Commercial Workers union (UFCW). He was joined by other union leaders, and by health care reform advocates from the business and medical communities and from Capitol Hill.

“The insurance companies with their scandalous profit-taking deny access to care to even those with insurance by practices of excluding pre-existing conditions, complex paperwork and uncovered benefits,” said Dr. Claudia Fegan, president of the Physicians for a National Health Program (PNHP). “Over 12,000 physicians support a national health insurance program that will cover everyone with the money we would save from the administrative waste of our current system.”

U.S. Rep. Tammy Baldwin (D-WI) said “it is time to put ‘health care for all’ at the top of our national agenda.” She has introduced a bill that would give federal funding to states that institute programs expanding access to health care. Rep. Baldwin and Dr. Fegan have agreed to serve on the Advisory Committee for America’s Agenda.

“Our medical system is dysfunctional and bad not just for our health, but for our entire economy,” said Bernard Rapoport, founder and former CEO of the American Income Life Insurance Company. Rapoport, a member of the America’s Agenda governing board, said “soaring costs are undermining the competitiveness of American business in the global economy. The U.S. is the only country in the industrialized world that doesn’t have publicly-financed health insurance, so American companies are burdened with expenses others don’t have, endangering our manufacturing base.” As examples, he cited Ford Motor Co. that spends $3.2 billion a year on health premiums and General Motors that spends more on health than on steel.

“The American people are fed up,” said Dority. “Poll after poll shows they want affordable health care that covers everyone. Why don’t we have it? Because America’s health insurance industry does everything in its power to block it . The current system may be a shambles, but it is a profitable shambles for those who run it.”

Joe Hansen, Dority’s successor as UFCW president and an America’s Agenda board member, renewed the union’s commitment to universal health care. “No one union, no one company, has a solution for the health care crisis,” said Hansen. “It has to be a political solution.”

“Out of control health care costs are a huge problem not just for workers but for employers who have health care plans,” said Marty Maddaloni, general president of the United Association of Plumbers and Pipefitters. “It puts these employers at a competitive disadvantage with those who do not have such plans.”

“I can think of no economic issue that impacts all working families in America more than the growing health care crisis,” added Morty Bahr, president of the Communications Workers of America. “It is criminal that 45 million Americans are without any health insurance and that number is projected to go to more than 51 million in 2006.” Both Bahr and Maddaloni serve on the governing board of America’s Agenda.

Dority noted that in recent years concerned citizens from Massachusetts to New Mexico have waged statewide campaigns for universal coverage. Additionally, health care reform initiatives and legislative hearings are progressing in several states, “but the industry continues to spend astronomical amounts of money to defeat them.”

Health insurers all across the nation have come together to create America’s Health Insurance Plans (AHIP) to lobby for the status quo. AHIP will run a multi-million dollar campaign with offices in 46 different states. “In the recent past, effort after effort by state-level grassroots groups to reform our broken health care system has been defeated by the well-heeled health insurance lobby,” Dority said. “We intend to help level the playing field. We must break the insurance lobby choke-hold on U.S. health care.”

To support grassroots groups, Dority said that America’s Agenda: Healthcare for All will utilize TV, radio, print media and the Internet to mount creative and coordinated “truth campaigns”. Business leaders, physicians, elected officials, labor leaders and universal health care campaign activists will be effective “messengers of truth” about the costs and benefits of specific health reform proposals. “We will counter the insurance lobbyists by taking the truth to the American people,” said Dority.

Until recently, Dority was president of the United Food & Commercial Workers (UFCW), a union whose members have been in the forefront of the battle to protect health benefits on the job. This past winter, tens of thousands of grocery workers were forced into bitter strikes in California, Ohio, Kentucky and West Virginia, in an effort to hold the line for workers across the nation whose health benefits were under attack. Dority didn’t blame the employers— he blamed the system. In March, he announced he was stepping down at UFCW “to devote my energies to a new effort to convince our political leaders that health care for all Americans is long overdue.”

— ## —

Posted by pnhp at 12:26 PM | Permalink

Press Release
Embargoed until: October 7, 2004
For more information: Rand Wilson, 617 989-8045, rand@jwj.org

New “Waste Not, Want Not” report…
Study shows $245 billion savings from cutting insurance and drug industry waste could fund health care for all

Grassroots groups will release 15 state reports in 21 cities

WASHINGTON, DC - Jobs with Justice will release a report on Oct. 7 showing that approximately $245 billion is wasted on private insurance red tape and protecting drug company super-profits each year. The study concludes that by providing insurance more efficiently and making drug companies sell in a more competitive market, the savings could be used to provide secure, affordable health care for all.

The report, Waste Not, Want Not: How Eliminating Insurance and pharmaceutical Industry Waste Could Fund Health Care For All will also be released by local Jobs with Justice coalitions or other organizations in CA, FL, GA, IN, KY, MA, MN, NC, NY, OH, PA, RI, TN, TX, and VT. Local releases will have state-specific versions of the report with data showing that in every state the savings from waste is enough to cover all of the uninsured.

Waste Not, Want Not focuses on how three reforms to the current health care system could prevent billions of dollars in waste and yield enough savings to guarantee secure and affordable health care for all. Specifically:

· The fragmented system of nearly 1,300 private health insurance companies creates unnecessary red tape and administrative waste. The national Medicare program has a proven track record of providing insurance at slightly less than one-tenth the cost of private plans. Adopting Medicare’s standard of efficiency and improving and expanding it to cover everyone, would save more than $94 billion on health care every year.

· Although the federal government and other public sources already pay half the cost of research and development, drug companies receive long term patent protections that discourage competition and guarantee super profits. If the federal government paid for all of the R&D, it could eliminate the patent protections, encourage competition and generic drugs, and save $140 billion in health care costs every year.

· The Bush Administration’s recently enacted Medicare prescription drug bill gave additional subsidies for private insurers because they can’t compete with the efficiency of Medicare. Reversing these and other devastating changes to Medicare could save $83.6 billion (or $11 billion a year) over the next eight years.

Together, these savings would be more than enough to provide insurance coverage for all of the 81.8 million people who went without health insurance for all or part of last year.

“Americans are paying more for health care and getting less every year. Waste Not, Want Not is proof that we are not just spending more than any other country, we are wasting more,” said Rep. Jan Schakowsky (D-IL). “Instead of throwing away precious health care dollars on bureaucracy, fragmentation and excessive profits, we could be providing high quality medical care for all.”

“So many politicians say they support the concept of health care for all, but then hide behind the question of how a universal plan would be financed,” said Fred Azcarate, director of Jobs with Justice. “Our study shows that health care for all isn’t an economic problem; it’s a question of political will. Across the country, people are building a movement to force politicians to stand up to the special interests and pass laws for secure and affordable health care!”

Waste Not, Want Not is based on an analysis of government census and economic data done by the Center for Economic and Policy Research (CEPR), located in Washington, DC. The report was funded by six unions in conjunction with Health Care Action Week, October 3 – 10, 2004.

Health Care Action Week is sponsored by eleven unions and nine national health care reform organizations.

The report will be available on the Jobs with Justice website at www.jwj.org on October 7.

Jobs with Justice is a national campaign for workers’ rights. More than 40 local Jobs with Justice coalitions unite labor, community, faith-based and student organizations to build power for working people.

# # #

Rand Wilson
Jobs with Justice (www.jwj.org)
21 Fellows Street, Boston, MA 02119
Phone: (617) 989-8045, Fax: (617) 541-6839, Email: rand@jwj.org

Posted by pnhp at 10:24 AM | Permalink

Wages, Health Benefits, and Workers’ Health
By Sara R. Collins, Karen Davis, Michelle M. Doty, and Alice Ho
The Commonwealth Fund - October 2004

Eighty-eight percent of employees earning more than $15 per hour had employer-sponsored insurance, but only 41 percent of those earning less than $10 per hour had such coverage.

…because there are few sources of affordable coverage outside the employer-based system, most workers without employer-based coverage are uninsured.

http://www.cmwf.org/usr_doc/Collins_workers_IB_788.pdf

Comment: This is not news. We already knew that less than half of low income workers (under $10/hour) have employer sponsored coverage, and they cannot afford coverage in the individual market.

What is more disconcerting is the following excerpt from the discussion section of this report:

“The employer-based health insurance system alone is insufficient to provide coverage to all Americans. However, the system is unlikely to change in the near future due to strong public support, the system’s relative efficiency in financing coverage, and a growing federal budget deficit. Any solution to expand health insurance coverage in the near term will likely have to build on the current system’s structure.”

This supposedly self-fulfilling prophecy has been repeated over and over again during the last decade. As we continue to build on the current system’s structure, the numbers of uninsured have increased and affordability is not only a threat, it has become a reality for those with health care needs.

What is there about “universal, national health insurance” that our policymakers don’t understand?

Posted by pnhp at 08:50 AM | Permalink

Edmonton Journal
October 5, 2004
Health-care fraud alarm sounded
Auditor criticizes Alberta gov’t for losing track of two million health cards
By Jason Markusoff and James Baxter

(Auditor General Fred) Dunn charged that Alberta Health ignored its own warning in a report from 1998. The ministry’s health-fraud watchdogs had raised the spectre of U.S. citizens using Alberta health-card numbers.

In some health regions near the U.S. border, there were double as many health numbers as there were residents. For Americans without health insurance, medical costs in the U.S. can be astronomical. Alberta health-care cards would be money in their pockets.

http://www.canada.com/edmonton/edmontonjournal/news/story.html?id=99959fde-e0db-4d46-8115-515001e92e8d#Soundoff

Posted by pnhp at 03:01 PM | Permalink

Progress On Health Coverage Is Threatened As States Continue To Face Growing Pressures To Control Costs
Kaiser Family Foundation - News Release
October 4, 2004

With continuing budget pressure, all states are planning at least one new cost-containment action for their Medicaid programs in FY2005. Thirty-nine Medicaid directors expect pressure on their programs to grow in FY2005…

A second survey of enrollment and eligibility policies in Medicaid and SCHIP for low-income families shows that while these programs played a critical role in ensuring that even more Americans did not become uninsured, states are taking actions to reduce spending, particularly in SCHIP, that reverse efforts to make health coverage more accessible.

Amid discussions on how to address the nation’s 45 million uninsured, policymakers have proposed expanding public coverage programs and spending more money on outreach efforts to help enroll those who are eligible, but not participating in Medicaid and SCHIP. However, state actions reversing simplified enrollment procedures and increasing cost-burdens on low-income families will make coverage gains more difficult to achieve.

http://www.kff.org/medicaid/kcmu100404nr.cfm

Comment:
The only successful incremental expansions of the past decade have been the introduction of SCHIP and the expansion of Medicaid. But since these are programs for low income individuals, a segment of our population without a political voice, support is waning.

Our national strategy of incrementalism is failing miserably. The numbers of uninsured are increasing, the protection provided by private plans is plummeting, and health care costs continue to skyrocket. It is now more clear than ever that affordable, comprehensive care for everyone will be achievable only by the adoption of a single, universal, national health insurance program.

For those who need a reminder why incremental reforms will not solve the health care crisis: http://www.jabfp.org/cgi/content/full/16/3/257

Posted by pnhp at 08:42 AM | Permalink

By Dennis Cauchon and John Waggoner
USA TODAY - 10/4/2004

The long-term economic health of the United States is threatened by $53 trillion in government debts and liabilities that start to come due in four years when baby boomers begin to retire.

The $53 trillion is what federal, state and local governments need immediately - stashed away, earning interest, beyond the $3 trillion in taxes collected last year - to repay debts and honor future benefits promised under Medicare, Social Security and government pensions.

“As a nation, we may have already made promises to coming generations of retirees that we will be unable to fulfill,” Federal Reserve Chairman Alan Greenspan told the House Budget Committee last month.

“Economists agree this cannot go on,” says Joseph Stiglitz, President Clinton’s chief economic adviser from 1995 to 1997. “We can borrow and borrow, but eventually there will be a day of reckoning.”

Economist James Galbraith of the University of Texas in Austin is a rare optimist in this debate. “I’m not at all concerned about Medicare or Social Security,” Galbraith says. “Unless the government goes broke, Medicare isn’t going to go broke, and the U.S. government isn’t going to go broke because it can print money.”

Galbraith says the country can handle higher tax rates, as Europeans do, and can save money by cutting spending elsewhere, such as on defense, and by implementing a Canadian-style health care system that uses private doctors and hospitals but has the government set prices and pay the bills.

“We are an enormously rich country,” he says. “Providing health care and a modest living for our elderly is certainly something we can afford.”

http://www.usatoday.com/news/nation/2004-10-03-debt-cover_x.htm

Comment: It’s about priorities. Nothing more, nothing less.

Posted by pnhp at 10:45 AM | Permalink

Robin McKie, science editor
The Observer - Sunday September 19, 2004
http://observer.guardian.co.uk/international/story/
0,6903,1307825,00.html

Bloated, blue-collar Americans - gorged on diets of fries and burgers, but denied their share of US riches - are bringing the nation’s steady rise in life expectancy to a grinding halt.

Twenty years ago, the US, the richest nation on the planet, led the world’s longevity league. Today, American women rank only 19th, while males can manage only 28th place, alongside men from Brunei.

These startling figures are blamed by researchers on two key factors: obesity, and inequality of health care. A man born in a poor area of Washington can have a life expectancy that is 40 years less than a woman in a prosperous neighbourhood only a few blocks away, for example.

‘A look at the Americans’ health reveals astonishing inequalities in our society,’ state Professor Lawrence Jacobs of Minnesota University and Professor James Morone, of Brown University, Rhode Island, in the journal American Prospect .

Their paper is one of a recent swathe of studies that have uncovered a shocking truth: America, once the home of the world’s best-fed, longest-lived people, is now a divided nation made up of a rich elite and a large underclass of poor, ill-fed, often obese, men and women who are dying early.

In another newly published paper, statisticians at Boston College reveal that in France, Japan and Switzerland, men and women aged 65 now live several years longer than they do in the US. Indeed, America only just scrapes above Mexico and most East European nations.

This decline is astonishing given America’s wealth. Not only is it Earth’s richest nation, it devotes more gross domestic product - 13 per cent - to health care than any other developed nation. Switzerland comes next with 10 per cent; Britain spends 7 per cent. As the Boston group - Alicia Munnell, Robert Hatch and James Lee - point out: ‘The richer a country is, the more resources it can dedicate to education, medical and other goods and services associated with great longevity.’ The result in every other developed country has been an unbroken rise in life expectancy since 1960.

But this formula no longer applies to America, where life expectancy’s rise has slowed but not yet stopped, because resources are now so unevenly distributed. When the Boston College group compared men and women in America’s top 10 per cent wage bracket with those in the bottom ten per cent, they found the former group earned 17 times more than the latter. In Japan, Switzerland and Norway, this ratio is only five-to-one.

Jacobs and Morone state: ‘Check-ups, screenings and vaccinations save lives, improve well-being, and are shockingly uneven [in America]. Well-insured people get assigned hospital beds; the uninsured get patched up and sent back to the streets.’ For poor Americans, health service provision is little better than that in third world nations. ‘People die younger in Harlem than in Bangladesh,’ report Jacobs and Morone.

Consumption of alcohol, tobacco and food can also have a huge impact on life expectancy. The first two factors are not involved with America’s longevity crisis. Smoking and drinking are modest compared with Europe. Food consumption is a different matter, however, for the US has experienced an explosion in obesity rates in the past 20 years. As a result, 34 per cent of all women in the US are obese compared with 4 per cent in Japan. For men, the figures are 28 and 2 per cent respectively.

‘US obesity rates jumped in the 1980s and 1990s, and the vast majority of the population affected by obesity had not yet reached age 65 by 2000,’ state the Boston group. ‘As the large baby boom cohort begins to turn 65 in coming years, a stronger connection between obesity rates and life expectancy may emerge.’

In other words, as the nation’s middle-aged fatties reach retirement age, more and more will start to die out. Life expectancy in the US could then actually go into decline.

Posted by pnhp at 10:35 AM | Permalink

By Jerri Stroud
St. Louis Post-Dispatch
09/29/2004

The health care industry needs to get its house in order before the government imposes a system that no one will like, the president and chief executive of the Blue Cross and Blue Shield Association, Scott Serota, said Wednesday at a meeting of health care professionals at Washington University’s School of Medicine.

“We have a window of opportunity,” Serota said. “We have to step through it” or else face a system where consumers have to line up and wait for care as they do under single-payer systems in Canada and Britain.

The association he heads is an umbrella group for health care insurers who
use the Blue Cross and Blue Shield brand.

Business groups stand ready to help the health care industry control costs…, said Tom Irwin, senior vice president of public policy for the St. Louis Regional Chamber and Growth Association.

“We don’t have any solutions,” Irwin said. “But we can help you.”

http://www.stltoday.com/stltoday/business/stories.nsf/0/03880FF5F9A9C98886256F1F000B12F8?OpenDocument&Headline=Blue+Cross+chief+warns+of+impending+peril

Comment:
When the president and chief executive of the national Blue Cross
and Blue Shield Association believes that it is necessary to attack the
single payer model of reform, it is clear that the rationale of single payer
poses a very real threat to their industry. He realizes that private plans
have failed to adequately address the failures that a single payer system
would rectify. It is also interesting that a representative of the business
community offers help, but no solutions.

We have a solution: single payer. And Scott Serota confirms that our message
is being delivered. You can be proud that your efforts to educate the public
have been effective. Keep up the good work; more of the nation still needs
to hear from us.

Don

Posted by pnhp at 09:29 AM | Permalink

by Saul Friedman
October 2, 2004

It’s time Gray Matters put up or shut up, instead of merely complaining about what passes for the American health care system. And if one day we get a responsive president and Congress, what is a realistic alternative to the nation’s dependence for its health care on the private health insurance business?

I say “realistic” because presidents at least as far back as Harry S. Truman in 1948 have sought universal health care - but he had to settle for Medicare about 20 years later. In 1992 the Clintons tried with a proposal that sought to satisfy everyone, but it collapsed under its own weight and was killed by the insurance industry.

But the polls and the deepening crisis in health care, including the loss of insurance for millions of workers and retirees, seem to be reviving the imperative for change. And if we can stop the Bush administration from killing our only national health insurance program, Medicare, it could become the vehicle for a politically feasible alternative - a universal, “single-payer” system.

Despite the assaults from the right, Medicare remains the nation’s most popular and efficient health insurance program: 90 percent of eligible beneficiaries participate, and 98 percent of non- pediatric physicians accept Medicare; so do most hospitals. According to polls, younger workers hope to join one day, but doubt there will be enough funds left for them.

Nevertheless, Medicare coverage is incomplete, without a real prescription drug benefit and too many limits to save money. And it pays too much money to private contractors that administer the benefits in each state. More important, Medicare will die of old age or be killed by HMOs unless the program is opened, perhaps gradually, to all Americans. That way, the Medicare risk pool could be strengthened by the young, and the program for the elderly would become the U.S. version of Canada’s single-payer system.

Single-payer is not socialized medicine or anything like the British model, but it is not widely understood in the United States. The best and clearest explanation can be found in a narrative or an animation by Graham Walker, a Stanford University medical student and former staff member of Physicians for a National Health Program. (Look for it at www.grahamazon.com/sp)

Briefly, Walker says, “Socialized medicine is the system in the U.K. - the government owns the hospitals, employs the doctors.” Single-payer is more like the Canadian system, where “the government pays the hospital and pays the doctor, but hospitals and doctors are still part of the private sector.… Everyone cares who their doctor is, but do you really care who pays your doctor?”

If you’re worried that the government can’t do anything right, Medicare, backed by 35 years of expertise, is far more efficient and responsive than your average insurance company. Yet its coverage reaches everywhere. Ask anyone who’s been on Medicare for years whether it works. Ask any caring physician whether he or she has more trouble dealing with Medicare or the HMOs, which doctors and hospitals have had to sue.

“Right now,” Walker says, “we ration care by the ability to pay.…Single-payer rations care by health care need. There would be no more pre-existing conditions, no more hassles to see a doctor.”

Medicare, which covers more than 40 million older and disabled Americans, is dependent on congressional appropriations and is running into financial trouble; its premiums and fees are getting too expensive. How can the United States pay for a similar single-payer system to cover 300 million? “Money would come from employers and employees,” Walker says, “but most of the money is already in the system - it’s just currently going to HMOs [and other private insurers] instead of to a single payer.” He noted that several studies estimated that a single-payer system would save enough money on administration to cover the 45 million Americans who are uninsured.

An estimated $285 billion is spent on administrative and middlemen services that provide not a single aspirin. Says Walker: “The U.S. spends double what most other countries spend on health care, and Americans have shorter life spans and millions go uninsured. Many financing schemes exist.… Put most simply, the money that most businesses currently pay for health care would go to single-payer; this would make up most of the money needed.”

As Sen. Hillary Rodham Clinton (D-N.Y.) pointed out, businesses in Canada and other nations with similar health systems have the edge over the United States. Employers, including government, face increasing costs to cover their workers, as well as retirees. With single-payer, no more would a worker or retiree be left without health coverage by a bankruptcy or budget problems.

A new poll for the nonpartisan Civil Society Institute reports that 67 percent of Americans would support guaranteed health insurance, through a government program or a nonprofit source. Even when called “national health insurance,” it’s supported by 52 percent.

I’m sure any single-payer system will have its glitches and frustrations, and some for-profit hospitals and health care corporations may not survive. Nevertheless, single-payer is worth considering.

Write to Saul Friedman, Newsday, 235 Pinelawn Rd., Melville, NY, 11747-4250, or by e-mail at saulfriedman@comcast.net.

Copyright © 2004, Newsday, Inc.
This article originally appeared at:
http://www.newsday.com/news/health/ny-saul3991259oct02,0,6607503.column?coll=ny-health-headlines

Posted by pnhp at 11:00 AM | Permalink

In follow-up to today’s message on drug patent monopolies:

By Susan Jaffe
The Plain Dealer
September 29, 2004

U.S. Rep. Dennis Kucinich proposed a new federal law Wednesday that would allow the government to take over private drug research and eliminate drug companies’ monopoly on high-priced, brand-name drugs.

His “Free Market Drug Act” would create a federal Institute for Biomedical Research and Development within the National Institutes of Health that would oversee pharmaceutical research by government labs, and universities and private companies working under government contracts.

Their research would be public, and the formulas they develop for new drugs would be available to any manufacturer approved by the U.S. Food and Drug Administration to make them.

http://www.cleveland.com/news/plaindealer/index.ssf?/base/news/109645024237250.xml

Comment:
One of the four proposals described in Dean Baker’s report is the Kucinich proposal.

http://www.cepr.net/publications/patents_what_are_the_issues.htm

Posted by pnhp at 09:07 AM | Permalink