We need single-payer, nonprofit health insurance

By Garrett Adams
Lexington Herald-Leader, March 27, 2011

Since the passage of its landmark health reform law of 2006, the people of Massachusetts have been living like a canary in a coal mine. National health policy experts have been watching them, closely studying how they're faring under the reform.

That watch intensified after enactment of the new federal health law, which is patterned after the Massachusetts plan. Both laws contain an individual mandate requiring people to buy private insurance, for example. The theory is that, as the Bay State goes, so goes the nation.

The first reports were glowing. The number of uninsured went down. Massachusetts now boasts the lowest percentage of uninsured residents in the nation, 4.4 percent.

But with the passage of time, and despite generous dollops of supplementary federal aid to help keep the Massachusetts plan afloat, the canary isn't looking too chipper these days.

Insurance premiums and out-of-pocket health costs keep rising. These skyrocketing costs prompted Gov. Deval Patrick to call for the program's "overhaul" just last week.

Now comes a Harvard research study showing that despite the increase in the number of people covered, the Massachusetts reform hasn't made a significant dent in the medical bankruptcy rate. Families still are being ruined by unpayable medical bills.

The researchers discovered that between early 2007 and mid-2009 — before and after the reform took effect — the share of medical bankruptcies in Massachusetts changed very little, from 59.3 percent to 52.9 percent. The absolute number of medical bankruptcies actually climbed from 7,504 to 10,093.

Lest you think only low-income families are being financially clobbered by medical debt, think again. Two-thirds of the bankruptcy filers were college-educated and 89 percent had health insurance when they filed their court papers.

In explanation, the authors of the study, which appears in the American Journal of Medicine, write: "Health costs in the state have risen sharply since reform was enacted. Even before the changes in health care laws, most medical bankruptcies in Massachusetts — as in other states — afflicted middle-class families with health insurance. High premium costs and gaps in coverage — co-payments, deductibles and uncovered services — often left insured families liable for substantial out-of-pocket costs. None of that changed."

Lead author Dr. David Himmelstein elaborates: "Massachusetts' health reform, like the national law modeled after it, takes many of the uninsured and makes them under-insured, typically giving them a skimpy, defective private policy that's like an umbrella that melts in the rain: The protection's not there when you need it."

Needless to say, these findings don't bode well for the look-alike federal law's ability to end the scandalous blight of medical bankruptcies in the U.S. And behind these statistics are tragic, heart-rending stories.

The crux of the problem is this: Both the Massachusetts law and the new federal law are based on the crumbling foundation of for-profit, employer-based health insurance, a financing model that has outlived its usefulness.

Our present setup is a crazy-quilt patchwork of plans that results in huge inefficiencies and mountains of wasteful paperwork — just ask your doctor! And our current arrangements contain a deeply embedded incentive for private insurers to enlarge their profits by enrolling the healthy, screening out the sick and denying claims.

In Canada, which has a truly universal, non-profit single-payer system of financing care called medicare (bearing resemblance to our own much more limited Medicare program), medical bankruptcies are virtually unknown.

Sure, you'll hear the occasional exaggerated story about wait times in Canada. But if you want to hear real horror stories, you need look no further than our own community. And if you ask Canadians if they'd prefer a U.S.-style health system, 9 out of 10 will say no.

It's never too late to do the right thing. Congress should move beyond patchwork solutions and implement a streamlined single-payer system, an improved Medicare for all.

The savings in bureaucracy alone would be enough to cover everyone, and the threat of medical bankruptcy would vanish overnight. Significantly a single-payer system's bargaining power would control costs.

We can't wait for the canary to keel over.

Dr. Garrett Adams is a pediatric infectious diseases specialist in Louisville He is a co-founder of Physicians for a National Health Program-Kentucky and president of Physicians for a National Health Program

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