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Articles of Interest

Medicare: Improve it, expand it

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By Johnathon S. Ross
Toledo Blade, Aug. 8, 2010

Medicare, which just turned 45, is a uniquely American program that should have been the model for health reform: no overwhelming bills, no denial of services, no limitations on what hospital patients can use or what doctor they can see.

But instead of expanding and improving Medicare, Congress has added a third floor to a house with a crumbling foundation – our private, for-profit, insurance-based system of financing health care.

As nonprofit community-service organizations, health insurers were once effective in spreading medical costs across the community. Today, private insurance is a very bad bargain.

Private insurers make money by denying claims. They cause Americans to waste enormous amounts of money on excess paperwork and bureaucracy – their own and what they inflict on hospitals, patients, and doctors like me.

An estimated 31 cents of every U.S. health-care dollar go to administration, at least half of it unnecessary. The number of administrative personnel working in health care has jumped by more than 3,000 percent over the past three decades. In the same period, the number of doctors, nurses, and other direct caregivers has grown by less than 200 percent.

Health care has been overtaken by bureaucracies stuffed with money-changers and paper-pushers, whose CEOs get astronomical salaries. Instead of delivering care, they chase the money to pay for it. In our complex, multipayer system, that is expensive work.

Rather than remedy this waste, the new health-care law creates “insurance exchanges” whose public and private bureaucrats will determine eligibility for subsidies and enforce fines against those who fail to buy insurance. Private insurers will continue to advertise and market their products, bill for premiums, establish eligibility for coverage, coordinate benefits, manage a multitude of contracts with brokers, businesses, individuals, doctors, hospitals, and other providers – and pay stockholders a high rate of return.

Each hospital and doctor must mirror this administrative mess to get paid. The new law perpetuates wasteful overhead and guarantees insurers more profits. Meanwhile, we will spend $447 billion over 10 years to subsidize the mandatory purchase of shoddy private insurance by 16 million Americans who are now uninsured.

Massachusetts and several other states have already tried insurance exchanges. They don’t control costs; Massachusetts has the highest health-care costs in the world.

Market competition just doesn’t work well in health care. Medical care isn’t an ordinary product that people want; it’s a necessity that they must have. The most expensive care is often neither optional, predictable, nor negotiable.

Under the new law, tens of millions of Americans will remain uninsured while tens of thousands will die each year because of a lack of coverage. Bankruptcy caused by medical costs will decrease by only 15 percent, because the new subsidized coverage will be so skimpy. Meanwhile, administrative complexity and waste will continue to grow.

A better alternative would build on the solid foundation of our tax-financed, low-overhead Medicare system, extending it to cover all Americans. Administrative savings would approach $400 billion a year, enough to provide comprehensive coverage to the uninsured and to improve coverage for the rest of us.

Negotiating pharmaceutical prices, as the Veterans Administration does, would lower drug costs by about 40 percent. Effective cost control also would occur through global budgeting for health facilities, negotiated fees, bulk purchasing, and rational – rather than profit-driven – allocation of capital expenditures and health resources.

With a single, comprehensive source of health data, quality of care could be reliably measured and improved. The ability to detect fraud and billing abuse would increase. Employer health-care costs would be predictable and easier to control.

Bankruptcy and foreclosure because of medical debt would be eliminated. Americans would have true health security. None of us would be forced to choose between medical care and other necessities such as food and housing.

It’s not too late to do the right thing. The sooner we enact Medicare for all, the better off our patients and our economy will be. Polls suggest that most Americans, including physicians, support improving and expanding Medicare.

The best way to celebrate Medicare’s birthday is to build on its ability to save lives, save money, and make us all proud by becoming one of the best health systems in the world.

Johnathon S. Ross of Toledo is a past president of Physicians for a National Health Program and a member of the executive committee of the Single Payer Action Network of Ohio.

http://www.toledoblade.com/article/20100808/OPINION04/8070349

Media Coverage

Medicare: Improve it, expand it

Johnathon S. Ross

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