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Neoliberal Health Model Comes Home to Roost in the United States—If We Let It

Obamacare repeats an approach to expanding private health insurance that has not worked in other countries, new study finds

FOR IMMEDIATE RELEASE, May 1, 2016
Contact: Howard Waitzkin, M.D., Ph.D., cell: 505-453-7078, waitzkin@unm.edu
Contact: Ida Hellander, M.D., cell: 708-941-7100, ida@pnhp.org

The model for Obamacare is not new and actually adopts an approach to expanding health insurance that several other countries such as Colombia, Chile, and Mexico have tried without success, a new study reports. 

An article published in the May 2016 issue of Monthly Review traces the origins of Obamacare to policies that the World Bank and other international financial institutions have promoted since the early 1990s.

These “neoliberal” health reforms have used tax revenues to buy private insurance coverage and have privatized health services, the study found. As a result, according to the article, corporate profits have soared, the safety net of public hospitals and clinics has deteriorated, and health costs have increased.

The study’s lead author, Dr. Howard Waitzkin, discovered that these ideas originated in work by economists in the U.S. military sector and then began to influence health policy when one of those economists, Alain Enthoven, moved into health economics after the Vietnam War.

This orientation entered into the design of Colombia’s health reform of 1994, Hillary Clinton’s proposal in the United States during the same year, and the Massachusetts insurance plan that Mitt Romney proposed as governor during 2006, the authors, with backgrounds in health research and activism, argue.

The article shows that the same approach surfaced again as Obamacare, after Barack Obama received the largest campaign contributions in history from the private insurance industry and switched his position from supporting a public-sector, single-payer approach that he had favored as a state legislator.

“In countries like Colombia that have adopted the neoliberal model,” study co-author Dr. Ida Hellander said, “access to care has not improved significantly, but the costs of care have increased rapidly, in parallel to sharp increases in corporate profits.” In Colombia, according to the article, negative effects of the reform include delayed payments, corruption, high overhead, increasing legal actions due to denial of care, and illegal investment of health funds by for-profit insurance companies.

Based on prior neoliberal reforms, Dr. Waitzkin predicted, “Obamacare is likely to fail, finally opening the door for a national health program in the United States that recognizes health care as human right rather than a commodity to be bought and sold in a marketplace.”

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Howard Waitzkin and Ida Hellander, “Obamacare: The Neoliberal Model Comes Home to Roost in the United States—If We Let ItMonthly Review, May 2016, is available on-line at http://monthlyreview.org.

Dr. Howard Waitzkin is Distinguished Professor Emeritus of Sociology at the University of New Mexico and Adjunct Professor of Internal Medicine at the University of Illinois. Dr. Ida Hellander is Director of Health Policy and Programs at Physicians for a National Health Program, Chicago, Illinois.