Single-payer coverage already works in U.S.
BY JAMES C. MITCHINER
The Ann Arbor News
Sunday, August 19, 2007
The recent launch of health reform in Massachusetts, centered on a joint individual-employer mandate, calls to mind the approach taken by Michigan’s road repair crews to the potholes that appear in the spring: cosmetic, incremental, and oblivious to the crumbling infrastructure that lies beneath.
The hallmark of health care reform over the last 20 years, regardless of whether it’s been done on the state or federal level, has been to fix the cracks, fill in the holes and smooth over the rough spots - basically, anything that’s needed to prop up a fundamentally flawed system. We have seen state and federal reform proposals in various iterations, generally presented with great fanfare and with promises that were either short-lived or never materialized.
The one approach we haven’t tried - because of fear, complacency, politics, apathy, or all of the above - is to wring out the inefficiencies in financing, while maintaining our basic fee-for-service delivery model. This is the basic premise behind single-payer national health insurance.
It is sad that so many people see red when they hear the term “single-payer.” One imagines them conjuring up visions of rampant socialism, with all the epithets inherent in that moniker: massive governmental bureaucracy, indiscriminate rationing, crushing tax burden, long waits for care, incompetent graft-prone civil servants.
But I would like to think that reasonable people would look beyond the inflammatory rhetoric that disparages single-payer, and at least consider the potential salutary benefits.
Consider first the enormous administrative costs inherent in our current pluralistic “system,” one that is dominated by 1,200 private health insurers. These costs use up money that is detoured from acute and preventive medical care. We spend about 31 cents of every health care dollar on administration; Canada, with its single-payer system, spends just 17 cents. Each year, we pay more and seemingly get less, as the insurance companies attempt to restrict access and impose upon employees more restrictive cost-sharing arrangements while collecting higher profits. Employers are scaling back their employee health insurance coverage, with the result that more people are being priced out of the insurance market. And the inability to pay medical bills is responsible for about half of the personal bankruptcies filed each year in the U.S.
Single-payer is not “socialized medicine,” a term that is reserved for a system where the government owns the hospitals and the physicians are civil servants. Rather, a single-payer arrangement combines a private health care delivery system with public financing and puts everyone in a common risk pool. It reduces administrative inefficiencies and severs the link between employment and health care, making health insurance truly portable.
Single-payer would lead to a reduction in out-of-pocket expenses by reducing deductibles, co-payments and co-insurance. It would give you the freedom to select your own doctor and hospital, without first obtaining “preauthorization” by your current managed care plan. It would reduce health care disparities between Caucasians and under-represented minorities. And it would nurture free enterprise by ending the struggle of American companies to keep up with escalating health care costs, which makes them less competitive in a global market.
An analogy to single-payer is public education: we use federal and state tax dollars to finance K-12 education for every child regardless of parental income or job status (i.e., no means testing). If you switch jobs without moving out of the district, you don’t have to pull Johnny out of his third-grade classroom and transfer him to another school. If you lose your job, the school district does not deny Johnny an education. Parents have every right to eschew public schools and enroll their children in a private school of their choosing, financed by their own resources. And finally, the state Board of Education does not tell individual teachers how to grade the math test or what color chalk to use.
Single-payer would consolidate administrative functions, simplify billing, streamline claims management for patients and providers, and reduce costs. The Government Accountability Office has estimated that administrative savings from a single-payer system would be in excess of $200 billion annually, more than enough to cover those who are presently uninsured. Of course, a modest increase in payroll taxes would pay for it, but at the same time, individual households would be spared the average $11,500 in annual insurance premiums they are now paying for health insurance, an amount that is increasing by roughly 8 percent to 10 percent per year.
When people think of single-payer, they often think of Canada. Canada does not have a perfect health care system - no country does. Many of the problems in Canada, such as long waits and restricted access to the latest technology, have more to do with chronic under-funding by federal tax dollars, at least by American standards, than the structure of Canada’s health care system per se.
On a per-capita basis, the U.S. spent about $7,092 per person in 2005; Canada spent roughly 55 percent of that.
It would be reasonable to assume that if we pumped our per-capita expenditures into a Canadian-style system, we might not have the problems that our northern neighbors have.
Given finite resources, rationing in one form or another is inherent in any health care system. However, regardless of its flaws, the Canadian system generally allocates care according to medical need, rather than patient socioeconomic status. Over 80 percent of Canadians receive elective surgery within three months, and there is no evidence that Canadians are wait-listed for emergency surgeries. We don’t see busloads of Canadians crossing the border into Michigan every day to get expedited MRIs, nor is there evidence of a mass immigration of Canadian physicians into the U.S.
Also, polls have shown that Canadians are generally pleased with their system and an overwhelming majority of those asked would not want to replace it with American-style medicine.
Finally, to those who think single payer would never work in the U.S., consider this: the most popular health insurance program in the U.S., based on patient surveys, is a single-payer, government-run, tax-financed, administratively lean, non-means-tested, universal access program. Perhaps you’ve heard of it: Medicare. With administrative expenses of only 3 percent of annual receipts (versus 18 percent or more for some for-profit HMOs), Medicare is economically efficient.
When it was created 42 years ago, Medicare was castigated by the American Medical Association as a program of “socialized medicine” that would impede the doctor-patient relationship, destroy American health care and undermine democracy. Yet within a few years of its birth, it was a big hit with patients because it guaranteed access to hospital and medical services, while doctors (and hospitals) loved it because it guaranteed payment.
We can do better in American health care, and we should. It is time to seriously consider advocating for single-payer health insurance.
About the writer: James C. Mitchiner, an Ann Arbor resident, is an emergency physician at St. Joseph Mercy Hospital in Ann Arbor and president-elect of the Washtenaw County Medical Society. To contribute essays to Other Voices, contact Mary Morgan, opinion editor, at 734-994-6605 or mmorgan@annarbornews.com.