A Response to HCAN: Flawed Data, Failed Strategy
A collection of five responses to “Health Care for American Now” (HCAN) is below by authors Kip Sullivan, Ph.D., Dr. Quentin Young, Dr. Oliver Fein, PNHP co-founders Drs. David Himmelstein and Steffie Woolhandler, and Nicholas Skala.
We call them H-CAN’T (since you can’t talk about single payer if you join their group) for short!
To read Richard Kisch’s original blog posting, please click here.
by Nicholas Skala
07/16/08
The core of Richard Kirsch’s argument is that reformers should forego advocacy of a proven and effective reform — single-payer — in favor of policies which have already been demonstrated to be failures, because the latter are politically expedient. In other words, because failure is politically achievable, failure should be advocated.
The great wealth of literature and experience — both foreign and domestic — should leave us with no doubt that Kirsch and HCAN’s proffered reforms will not only fail to achieve anything approaching universal coverage, they will almost certainly make things worse. As Dr. David Himmelstein of Harvard Medical School points out, we’ve already heard promises that strict regulation of private insurers, placed in competition with a public plan, will demonstrate the public plan’s superiority. But the experience in Medicare has been quite the opposite — private insurers still managed to game the system and attract the healthy and profitable, to the detriment of the public system. This storyline is not confined to the United States: the private health insurer BUPA recent left the Irish market after a judge determined the company had unfairly skimmed healthier patients from the public system, and ordered the company to make adjustment payments.
The definition of insanity is to continue to repeat the same actions, expecting a different result. Yet this is exactly what Kirsch and HCAN advocate, and the results with be predictable. Their response to evidence that the medicine they peddle is nothing more than a placebo is simply to commission more pollsters to produce charts and graphs emphasizing its political feasibility.
In contrast, single-payer national health insurance works both on paper and in practice. Kirsch purports to dispel the “myth” that all European nations have single-payer by replacing it with a new one: that these systems preserve — as he and HCAN would — a substantial role for U.S.-style private insurance. Nothing could be further from the truth. In reality, all of these systems work only because they have regulated U.S.-style insurance companies out of existence. Even in the most privatized system, insurers are required to be non-profit, have their benefits and premiums dictated by the government, and must make “risk equalization” payments if one profits at the expense of another. We need not commission a poll in order to discern whether U.S. insurance companies are going to find such an arrangement more politically acceptable than single-payer.
After many years in the darkness, there is a groundswell of popular support for single-payer. “The U.S. National Health Insurance Act” (HR 676) has 92 co-sponsors in the U.S. House of Representatives. The U.S. Conference of Mayors has just voted unanimously to endorse it. Twenty-five state labor federations and hundreds of union locals have backed single-payer through a grassroots campaign. The majority of physicians and two-thirds of the American public say they support single-payer when polled. To raise the white flag of surrender and retreat to a position more favorable to insurance industry interests at precisely the time when popular support and grassroots energy are on the side of true reform is the real political miscalculation.
Statement of Dr. Quentin Young on “Health Care for America Now”
Press Release
For Immediate Release:
July 8, 2008
Contact:
Quentin Young, M.D., (312) 782-6006, info@pnhp.org
In a statement coinciding with today’s announcement of a new coalition called Health Care for America Now, Dr. Quentin Young, national coordinator of Physicians for a National Health Program, made the following remarks:
“Physicians for a National Health Program welcomes the call for quality, affordable health care for all by the new Health Care for America Now coalition.
“We note that a number of the organizations in Health Care for America Now are supporters of single-payer national health insurance, and we sincerely hope they will convince the entire coalition to adopt single payer as its platform and hasten the enactment of HR 676.“
“Based on more than two decades of research, including the study of domestic programs like Medicare and the failed “universal” reform efforts of several states, as well as the health care systems of other nations, we remain convinced that the only way to achieve the goal of truly universal, equitable and affordable health care in the United States is to remove the for-profit private insurance industry from the health care picture and to establish a single-payer national health insurance system, an improved and expanded version of Medicare for all.”
“The U.S. private insurance system is not the solution, but the source of the present problem.”
“We share the coalition’s abhorrence of health care policies that have been associated with the Bush administration and the presidential campaign platform of Sen. John McCain. These policies, if fully implemented, would substantially worsen an already untenable situation in which 47 million Americans are uninsured and a comparable number are underinsured, thanks to the profiteering and administrative waste of the for-profit private insurance industry.”
“At a time when the U.S. Conference of Mayors unanimously endorsed HR 676 and a recent poll indicated that 59 percent of U.S. physicians now support government-sponsored national health insurance, this is hardly the time to fall back to failed private insurance programs.”
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Physicians for a National Health Program (www.pnhp.org), a membership organization of over 15,000 physicians, supports a single-payer national health insurance program. PNHP is headquartered in Chicago and has chapters across the United States. To contact a physician-spokesperson in your area, contact info@pnhp.org or call (312) 782-6006.
PNHP Response to Health Care for America Now (HCAN) Campaign
Oliver Fein, M.D.
President-elect, PNHP
The American health care system is in deep trouble. Everyone recognizes that it needs substantial reform. For too many Americans, health care is simply unaffordable. As each year passes, millions more are added to the rolls of the uninsured and underinsured. Physicians for a National Health Program believes that only a real structural change, to a publicly-financed single payer program, can effectively address its many problems.
Now a number of progressive public interest organizations and labor unions have announced a health care reform campaign called Health Care for America Now ( www.healthcareforamericanow.org). We welcome the attention they are bringing to the critical problems of the health care system. We applaud their recognition that the reliance on private insurance companies lies at the heart of the problems we face, and that it is the responsibility of government to assure access to affordable health care for everyone. The more that Americans understand that government must play a key role in the necessary reform, and that the private insurance industry is incapable of providing us with the health care we need, the sooner we will get the reforms that must take place.
Unfortunately, although the founders of HCAN correctly identify the problem, the remedy they offer — a choice of private plans and a new public plan with government playing a “watchdog” role — takes us away from actually achieving decent health care for everyone in this country. Past attempts by many states to increase access and improve coverage by regulating the insurance companies have all failed miserably. As long as they are “players” in our health care, these insurers will use their power and influence to see to it that there is no meaningful regulation of their behavior. Time and again in this country’s history, we have seen such regulation founder as the regulators become captives of those they are supposed to regulate.
Under the HCAN plan, private health insurance would remain a nightmare for consumers and physicians with continuing co-pays, deductibles, delays, and denials of coverage. The cost of what is already the world’s most expensive system would continue to climb, with no effective cost control mechanisms in place. Those who think they are insured will still find, when they are sick, that their insurance has failed them and that they can’t afford the care they need.
In short, what the Campaign is proposing would add hundreds of billions of dollars to the cost of the system and yet would fail to solve the many problems Americans face in trying to get care. We will only solve these problems when we get the private insurance companies out of our health care. Only a publicly-funded system modeled on the very popular Medicare program can cover everyone while making it possible to contain the continually rising cost of care.
We believe that the leaders of many of the organizations involved in HCAN, as well as many of their members, know that creating a single payer system is the only truly workable remedy for what ails our health care system. Instead of adopting an approach that appears to be politically expedient, we urge them to support the only program that can truly accomplish their goal of quality affordable health care for everyone: a single payer national health program.
A Policy Response to Health Care for America Now
by David Himmelstein, MD
PNHP Blog
Wednesday, Jul 9, 2008
Health Care for America Now (HCAN) is pushing a superficially attractive health reform model that has a long record of failure — akin to prescribing a placebo for a serious illness when effective treatment is available. They would offer Americans a new public insurance plan and a menu of private ones, with subsidies for coverage for low income families.
This approach reprises the format of Medicare’s ongoing privatization. Despite promises of strict regulation and a level playing field that would allow the public plan to flourish, private insurers would (as they have done in Medicare) predictably overwhelm regulatory efforts through crafty schemes to selectively recruit profitable, lower-cost patients, and avoid the expensively ill. Like the Medicare Advantage program, originally touted as a market-based strategy to improve Medicare’s efficiency, the HCAN plan would evolve into a multibillion dollar subsidy for private insurers whose massive financial power (amassed largely at government expense) would prove a political roadblock to terminating the failed experiment.
Unfortunately, proposals like HCAN’s that cede a central role to private insurers can only add coverage by adding costs. They promise savings from computerization and chronic disease care management. Yet the Congressional Budget Office has warned that there is little or no evidence for such savings.
The HCAN proposal forgoes most of the $350 billion annually in administrative savings possible under single payer national health insurance (NHI). Administrative waste is a natural byproduct of the private insurance firms that would retain a central role under HCAN’s plan. Private plans’ overhead is 12-fold higher than under NHI; the excess is squandered on marketing, underwriting, utilization reviewers and profits, and for the billions paid to executives. And the multiplicity of insurers envisioned in the plan precludes paying hospitals a global, lump sum budget; such budgets would save additional billions by obviating the need for most hospital billing and much of the internal accounting needed to attribute hospital costs to individual patients and payers.
HCAN’s proposal duplicates key elements of health reforms that have passed (and then failed) in multiple states: Massachusetts in 1988; Oregon in 1989; Tennessee, Minnesota and Vermont in 1992; Washington State in 1993; and Maine in 2003. In each case, rising costs scuttled the reform effort; none had a durable impact on the number of uninsured. The 2006 Massachusetts law, which incorporates many of the features of HCAN’s plan, is already threatened by rising costs, despite offering skimpy coverage and leaving many uninsured. And Massachusetts, with its low rate of uninsurance to begin with, and a large fund devoted to care of the uninsured, offered the optimal conditions for trying such a plan.
HCAN’s proposal tries to avoid a head-on collision with private insurers, but the result is a plan that cannot achieve universal coverage or make care affordable. For physicians, offering a placebo in place of effective treatment is a serious ethical violation. Hence, while we salute the good intentions of the members of the HCAN coalition, we must warn against their proposal.
Response to Richard Kirsch’s “Why Not Single Payer?”
by Kip Sullivan, JD
My work history very closely resembles Richard Kirsch’s. Like Richard, I began organizing for universal coverage in the mid-1980s with a state chapter of what used to be called Citizen Action. Like Richard, I co-wrote a state-level single-payer bill (I was one of a half-dozen Minnesotans who, in 1990, wrote the single-payer bill that has been introduced in Minnesota’s legislature every year since 1991). But unlike Richard, I never abandoned single-payer.
I need to be blunt: Richard has abandoned single-payer. When you urge Americans not to work for single-payer and to support instead a plan which feeds tax dollars to the insurance industry (a diehard opponent of single-payer), you have abandoned single-payer. It is not a stretch to say you have become an opponent of single-payer. I appreciate the fact that Richard has stayed in community organizing all these years. I can testify to how financially and emotionally difficult that can be. But I strongly disagree with the path Richard has taken on health care reform.
To stress how similar our career paths have been, let me add an anecdote to one Richard tells in Will It Be Déjà vu All Over Again, his 2003 account of the history of the fight for universal coverage. (I thoroughly enjoyed reading the historical portions of this account, as opposed to Richard’s explanations of why history turned out the way it did.) Richard describes a national event involving several caravans of ambulances that traveled cross-country (west to east) in 1991 to dramatize the need for universal coverage. An ambulance in one of those caravans, a three-ambulance caravan that started in Minnesota, broke down just south of Duluth. When word of the breakdown arrived at the Minneapolis headquarters of Minnesota COACT (Citizens Organized Acting Together) where I worked, I dropped everything, took a bus from Minneapolis to Duluth, got the ambulance repaired, and drove it back down to Minneapolis at unlawful speeds in time for the ambulance to catch up with the rest of the “caravan” the next day.
In this post, Richard tells us that “people” (which presumably means a sizable majority of Americans) are fearful of a single-payer system. He claims he discovered this unpleasant fact (to his “surprise”) in 2003 in the course of writing Will It Be Déjà vu…, and this discovery forced him to “reframe [his] view” and abandon single-payer. But if you read Will It Be Déjà vu.…, you will see that Richard abandoned single-payer in 1993 or shortly thereafter, not in 2003.
In 1993, Citizen Action’s national staff and many of the state Citizen Action affiliates, including New York Citizen Action (the organization Richard has directed for two decades), shifted their resources away from the single-payer legislation pending in Congress to lobby for Bill Clinton’s awful Health Security Act, a bill that would have pushed all but wealthy Americans into HMOs. My organization, Minnesota COACT, was among the Citizen Action affiliates that refused to lift a finger to promote the Clinton bill despite considerable lobbying from the national Citizen Action office and AFSCME (another organization that abandoned single-payer to lobby for the Health Security Act). So Richard’s answer to his question, “What happened to me?” doesn’t ring true to me.
Richard’s answer — his current explanation for why he must continue to turn his back on single-payer in favor of the plan promoted by Health Care For America Now (HCAN) — suffers from three big defects: (1) He ignores numerous polls and other evidence indicating two-thirds of the public support a single-payer (or Medicare-for-all) system; (2) he ignores the fact that his “guaranteed affordable choice” proposal has at least as many unsightly warts (from the point of view of the insurance industry and the right wing) as single-payer does; and (3) even assuming his jaundiced view of public opinion about single-payer is correct, he totally ignores the role that courageous and passionate advocacy of single-payer can play in altering public opinion and inoculating the public against false accusations by the right. I’ll describe each defect briefly.
Defect 1 (turning a blind eye to evidence he disagrees with): Numerous polls and at least two “citizen jury” experiments (one involving Senator Paul Wellstone) indicate approximately two-thirds of Americans support universal coverage with a single-payer. I’ll give you just four examples:
- A 1991 Wall Street Journal-NBC poll found 69 percent support single-payer.
- A 2003 ABC News Poll found 62 percent said yes to the following question (note the bogeyman words “taxpayers” and “government” are in this question): “[Do you support] a universal health insurance program, in which everyone is covered under a program like Medicare that’s run by the government and financed by taxpayers?”
- An AP-Yahoo poll taken at the end of 2007 asked the same question ABC News asked and reported that 65 percent said yes.
- At the end of five eight-hour days of interviewing expert advocates for single-payer, the Clinton plan, and the Republicans’ high-deductible proposal, a 24-person “citizen jury” convened by the Jefferson Center in 1993 voted 17 for single-payer, 5 for the Clinton plan, and zero for the Republican proposal.
Note the high level of support for single-payer exists despite the absence of a well-endowed, highly visible single-payer movement. Of course, the absence of such a movement is due in part to the refusal of the AFL-CIO, SEIU, Health Care for America Now, USAction (the successor to Citizen Action) and other groups Richard works with to put resources into the single-payer movement. Note also that these high levels of public support for single-payer exist despite constant trashing of single-payer systems (like Medicare and Canada’s system) by the insurance industry and other powerful right-wing forces.
Richard offers no evidence in his post nor in Will It Be Déjà vu… that contradicts the evidence that two-thirds of Americans support single-payer. Nor does he offer any evidence to support his claim that a majority of the “people” oppose single-payer and that support for single-payer among citizens is more vulnerable to degradation under right-wing attacks than support for his “guaranteed affordable choice” plan would be. (It is possible to find polls, some with biased phrasing, that indicate that when Americans are given choices between a variety of proposals and asked which they prefer, fewer than half indicate they prefer single-payer. But even these polls do not contradict the statement that two-thirds of Americans will support a single-payer system if asked. They merely indicate “preferences,” not opposition to any particular proposal. In any case, Richard does not cite these.)
(In 2006, a group that Richard helped form called the Herndon Alliance began cranking out junk science that allegedly supports Richard’s claims. Obviously, given the timing of Richard’s decision to abandon single-payer—either 2003 or 1993—the Alliance’s junk science could not have played a role in that decision.)
Defect 2 (seeing the mote but not the log): Richard has an eagle eye for the controversial features of single-payer and a blind eye (or at least a very forgiving eye) for the controversial features of his proposal. Richard is eager to tell readers how “scary” single-payer is, but he is unwilling to help readers understand the enormous obstacles his “guaranteed affordable choice” plan faces. He is unwilling, in other words, to help his readers think about whether the obstacles to his proposal are less daunting than those he sees for single-payer. The most serious of the obstacles to his proposal will be the high cost of universal coverage under his plan and the need for costly and stringent regulations on the insurance industry that will infuriate the insurance industry and the right wing.
There is no cost containment in the proposal promoted by Richard and HCAN. In fact, as Richard and his allies flesh out their proposal (which at this date it is little more than ten bullet points on the HCAN Web site), I expect we will see provisions that will actually raise costs (such as the cost of the bureaucracy that will decide which health insurance companies get more money for insuring sicker people, the cost of detecting and investigating abuses of patients by insurance companies, the cost of switching from paper medical records to electronic medical records, and the cost of hiring more nurses to do “disease management”). By contrast, numerous studies, including those done by the US GAO and the Congressional Budget Office, demonstrate that a single-payer plan will achieve universal coverage for a lot less than Richard’s proposal or any other proposal that leaves the insurance industry in the mix.
Another huge impediment to Richard’s proposal is the need to impose regulations on the insurance industry to make his proposal work.(The most essential regulations will never be sufficiently effective, but I don’t need to get into that here.) The insurance industry and the right wing will fight these regulations with as much ferocity as they will fight single-payer.
A fair and useful discussion of the political feasibility of Richard’s proposal versus single-payer, then, would ask (among other questions) whether Richard’s proposal really is more feasible than single-payer when you take into account the high cost of his plan versus the lower cost of single-payer, and the intense resistance the insurance industry will put up against both plans. Richard doesn’t do that.
Defect 3 (leadership doesn’t matter): In his post and in his article, Richard has nothing to say about the role that enthusiastic support for single-payer from a large coalition of politicians and citizen, labor, and religious organizations could play in antidoting the corrosive effect of anti-single-payer propaganda. He is not only cynical about where public opinion is today, but he treats public opinion as if it were movable only in the anti-single-payer direction, never in the pro-single-payer direction.
That is, obviously, nonsense. If HCAN were to devote the $40 million they plan to spend on “guaranteed affordable choice” to a Medicare-for-all system (either implemented overnight or in stages), and if politicians like Senators Obama and Clinton would start talking about extending Medicare to everyone, the combined effect might well be to offset, and possibly even more than offset, insurance industry propaganda, which is to say, to maintain public support for single-payer at two-thirds or even increase it.
Richard’s “guaranteed affordable choice” plan is so poorly described in HCAN’s and Richard’s publications that it is a bit risky to predict what will happen to it. But here I go anyway. Odds are very high it will suffer a fate similar either to Clinton’s bill (it will never be enacted) or to the current Massachusetts “individual mandate” law (it will be enacted but it won’t achieve universal coverage because it will be too expensive and the insurance industry won’t be prevented from rationing). My fervent hope is that it will never be enacted.
My worst fear is that if it is enacted the Medicare-like public program that HCAN wants to create to “compete” with the insurance industry will be destroyed by the antisocial behavior of the insurance industry that simply can’t be regulated away. The public program will behave honestly while the insurance industry will keep doing what it does best — it will deny services and frustrate its enrollees and thereby drive the sickest of them into the public program — thereby pushing the public program’s costs up and its own costs down, and eventually driving the public program from the market. If that happens, the right wing will chortle, “See, we told you single-payers aren’t efficient, and now we’ve got proof.” It will be difficult for single-payer advocates, or HCAN for that matter, to explain that what actually happened was that the bad destroyed the good. The result could be prolonged damage to the public’s opinion of single-payer and further delay in establishing universal coverage.
Richard opens his article, Will It Be Déjà vu All Over Again, with this question: “Is this time really the time for universal health care? … . Or will the political process invent other half-measures rather than provide a government guarantee of affordable, quality health care for all?” Richard has answered his own question. He and others who abandoned single-payer in 1993 to support Clinton’s awful plan are repeating the mistakes they made 15 years ago. In 2008, as in 1993, they are urging Americans to abandon single-payer to support yet another “half measure” — a plan that can’t work but which, on the basis of superficial and biased analysis, seems to be more “politically feasible” than single-payer. Talk about Déjà vu!