CostRx: Kucinich's not-for-profit plan
By LAURA GILCREST
UPI Health Business Editor
April 25, 2007
WASHINGTON April 25 (UPI) — Rep. Dennis Kucinich of Ohio, a Democratic presidential contender, tells United Press International about his plan for national healthcare reform, which is centered on covering all Americans by taking the profit factor out of the equation.
Q: The bill that you co-authored, Medicare for All, uses the present Medicare program as a model for a national plan for universal healthcare. The bill would require private entities providing healthcare to convert to not-for-profit. Is there any role left for the private sector under the plan envisioned in this bill?
A: The understanding is, if you have for-profit medicine, it actually ends up precluding full coverage for all Americans. Under this plan, you’re talking about ending the rationing of healthcare, which is really what’s happening as a result of having for-profit medicine. So (the) short answer is that any for-profit insurance company that would duplicate Medicare for All would not be in business. All hospitals would be converted to not-for-profit.
Q: Would they then come under government control?
A: No, (they’d be) not-for-profit. It’s not that the government (would be) running the hospitals. What we’re talking about is that all of the healthcare assets in America would be converted to not-for-profit. You have Spain and the U.K and other countries that have a system where doctors are salaried by the government, and the government owns the hospitals.
Under Medicare for All, hospitals and doctors remain private, though they do become not-for-profit. And that’s important because there’s a lot of research that shows that for-profit healthcare is more expensive and more wasteful and has worse quality outcomes, including death rates.
You’ve got a lot of these free-market ideologues who try to attack this, but the truth is, that … countries that have a system that is not-for-profit have less red tape and less waste than the private system we have. And under this system, people would be able to choose their own doctor.
Q: One of your Democratic rivals, former Sen. John Edwards, admits he would raise taxes to pay for his healthcare plan. Would you also have to raise taxes?
A: John Edwards’ plan is to have the government subsidize the insurance companies. The truth of the matter is, I’m not talking about (doing) that, so there’s a difference immediately. What I’m saying is that, we’re already paying for healthcare for everyone, we’re just not getting it, and here’s how: About 31 cents out of every healthcare dollar goes to something other than providing healthcare (such as) corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. The cost of this bill is exactly what we’re currently spending on healthcare, $2.1 trillion dollars a year.
Q: So your plan could be accomplished for the same price?
A: Yeah, absolutely. The difference is that my bill gets rid of all the waste and uses the savings and the new efficiency to cover the uninsured and the underinsured completely. It’s important to note that we spent $2.1 trillion on healthcare in America in 2006 and 31 percent of that is bound up in the for-profit system; that’s about $650 billion dollars a year. And if you compare that to the administrative costs in Canada, Canada’s administrative costs are about 17 percent. And Medicare’s administrative costs are about 3 percent.
Q: But wouldn’t a tax hike be inevitable for such an ambitious plan?
A: No, not necessarily. This is not about a tax increase. I’m saying that people can get this care now without a tax increase by eliminating for-profit medicine. That’s the key point. You have over $650 billion a year going for corporate profits, stock options, executive salaries, advertising, marketing, the cost of paperwork. So you take those savings, put them into healthcare and suddenly, you have got enough money to cover 46 million people who don’t have insurance, and another 50 million who are underinsured. There’s so much money available when you make that transition, you then have enough money for vision care, dental care, mental health, prescription drugs and long-term care. This is the reason why you have 14,000 physicians backing (the bill) because what they’re saying is, “Hey, the money’s already there.” There’s no other nation that allows so much waste.
Q: What groups are backing your bill?
A: Fourteen thousand physicians in the Physicians for a National Health Program are backing this, 250 labor unions are backing it.
The fake debate in 2008 is over universal healthcare. Everyone running (for president) says they’re for universal healthcare and even the insurance companies are for universal healthcare, as long as the government is subsidizing them to provide it.
Sen. Edwards and Sen. (Hillary) Clinton are both talking about plans that would involve the government subsidizing the insurance companies, and those plans have fatal flaws because they don’t control costs, they do little to improve quality and they do little for access.
Q: What do you say to the skeptics who argue that more government involvement in healthcare will lead to rationing?
A: We have a rationing system right now, because you’re got 46, 47 million people uninsured; and you’ve got another 50 million who are underinsured. So self-rationing is what we actually have. We’re making costs so high that people avoid care. In other single-payer countries where they do have rationing, the problem is, they’re paying so much less than we are. If we pay more than they pay per person, but much less than we do now, rationing wouldn’t be a problem.
For (the United States), the problem is not the money, it’s the system. We spend more per capita than all these other countries. So the money is there, that’s the point. In some of these other countries, the problem for them is not the system, it’s (a lack of) money.
Q: The Democrats’ attempt to change Medicare’s Part D prescription drug benefit to allow the government to negotiate with drug companies for lower prices failed last week to muster enough votes in the Senate. Does this signal there is still resistance to what is viewed as government-imposed price controls?
A: With respect to this (bill), the government would negotiate the prices; that’s true, and it would have massive purchasing power to do so. The government currently negotiates prices with the Veterans Administration (U.S. Department of Veterans Affairs), so that’s been well-established and it has saved taxpayers, over a period of time, billions of dollars.
(What happened in the Senate) is a reflection of the power of the pharmaceutical companies, and the for-profit insurance companies. That’s one of the reasons why Sen. Edwards and Sen. Clinton are saying that the plan I’m talking about isn’t politically feasible.
(Healthcare) is far and away the No. 1 social and economic issue in this country. Anyone running for president who is conceding control of the system to the for-profit insurers raises serious questions about their ability to lead the nation.
What I’m saying is, those who are advocating the position of the insurance companies, (and) who are saying, “We’re going to cover more people, but the government is going to subsidize the insurance companies,” that (position) protects the insurance companies’ profits.
Q: But critics argue that putting the federal government in control of pricing will kill innovation by the drug industry. How would you respond?
A: We have to take our healthcare system back, we have to take it back from the for-profit insurance companies and from the pharmaceutical companies, who currently control the system for their own profit. This is not about innovation, because the truth of the matter is, a lot of the innovation begins with government-supported research.
What I’m saying is that a significant part of the program is cost control and you cannot control costs if the pharmaceutical companies can charge whatever they want for their drugs.
American companies are losing their competitive edge because they’re paying so much more for healthcare than other developed countries. You look at GM, you look at Ford, and our manufacturing power is being undercut by these insurance companies and by the pharmaceutical companies.
So I raise the question, “Who’s in charge here?” Is this a government of the people or is it a government run by the for-profit insurance companies and by the pharmaceutical companies? That’s why my election will be a powerful change in the direction of a non-for-profit system.