Medicare

Medicare at 50: Our Moral Imperative

R. Horton1 Comment

Last year, on the 49th anniversary of Medicare, I wrote a post advocating the expansion of Medicare to ensure that everyone in the United States can have access to basic healthcare. In the past year, I have read and heard many arguments against the expansion of Medicare and, in fact, single-payer systems in general. As I read the arguments, I realize that in a sense “Medicare for All” and “single-payer” have become a shorthand way of saying we need to guarantee “universal access to healthcare,” but I still think Medicare for All is the way to go in the United States.

I happily admit, though, that my commitment is to universal access to healthcare, not Medicare. The first step, in my opinion, is to declare that we will provide access to medicare for allhealthcare to all United States citizens. Take this simple idea, and make it law: We will provide healthcare to every citizen of the United States. Once that law is passed, we can have extended debates about whether Medicare can fulfill the purpose of guaranteeing that all citizens will have access to healthcare (my repetition is intentional).

Here are some of the objections I’ve heard and read to expanding Medicare along with my replies:

I don’t want to pay for healthcare for people who are too lazy to work.

Many people I talk to are extremely optimistic about their ability to pay for their healthcare in the case of extreme illness or injury. The fact that you’ve made it so far only means you’ve been lucky, not self-sufficient. Mary Brown, who sued the government over the Affordable Care Act because she didn’t want to purchase insurance, went bankrupt and was unable to pay her bills. In response to her own bankruptcy, Brown reportedly said, “”I believe that anyone has unforeseen things that happen to them that are beyond their control.”  Yes, and the Affordable Care Act was designed to reduce the impact of unforeseen illness and injury. Unlike Mary Brown, many people who become medically bankrupt had insurance but weren’t able to cover their medical bills, anyway. A study in 2007 found that three-fourths of people who were medially bankrupt had insurance.  A study by NerdWallet Health found in 2013 that “Despite having year-round insurance coverage, 10 million insured Americans ages 19-64 will face bills they are unable to pay.”

For people who do have insurance, most get it through their employers. Too many people seem to forget that when they face unforeseen illness or injury, they will also be unable to work and are likely to lose their employer-provided insurance. If not immediately, it will happen sometime further down the road. Whether the road is long or short, it leads to bankruptcy. While some are rich enough to be impervious to mounting medical debt, most of us are not. A few hundred thousand dollars may sound like a safe cushion against medical disaster, but many life-saving treatments exceed that amount quickly. Selling your house and other assets to pay your medical bills may not be a solution. In fact it probably is not a solution.

The fact is that supporting a national program to guarantee access to healthcare free from the risk of burdensome medical debt is not something you should do only for other people. It is something you should do for yourself. And it is something we should do for our country.

As a nation, we share many burdens: national defense, national safety, public health, personal security. Like infrastructure and security, we are not talking about items we can choose to forgo in leaner times. These are basic human needs. Any society that does not meet the basic needs of its citizens will falter. If we can share the cost of providing a strong military, food inspectors, fire fighters, and police, we can share the cost of providing health services. The financial life you save may be your own.

Most countries don’t have a true single-payer system.

The argument here is that many countries that do guarantee universal access to healthcare do not use a “true” single-payer system. I am willing to concede that even Medicare for All might technically require the use of more than one payer. What is important, really, is that the payers are not invested in fleecing their clients, which often seems to be the case with for-profit insurance companies. In fact, if we had a single for-profit insurance monopoly, we might find our processes somewhat more efficient but not beneficial for consumers, so it matters who the single payer is as well. Just to repeat: we must have a system that guarantees access to healthcare without the risk of bankruptcy.

Medicare is fraught with fraud and abuse.

No one can deny that fraud and abuse exist within the current Medicare system. We need greater transparency, oversight, and regulation of the system and of the providers. Also, Medicare must have the ability to negotiate prices, unlike the disastrous Medicare Part D that currently exists for prescription drugs.

Corporations will game the system.

It is true that for-profit providers, whether they are pharmaceutical companies, for-profit hospitals, biotechnology companies, medical equipment suppliers or food vendors, will strive to earn as much profit as is humanly possible. This is why we need a system that empowers taxpayers to hold bad actors accountable and demand transparency regarding pricing and profit. Corporations will serve the common good only when common people demand that they do. Fatalism is an excuse to avoid the hard work of diligence.

We need price controls.

Again, simply removing all but one payer will not, on its own, lower prices. If Medicare simply sent checks to providers for whatever charges they submitted, the United States would continue to have the costliest healthcare system in the world. Medicare must have the ability to negotiate prices and set limits on unchecked profits.

We must limit unnecessary tests and treatments.

In a pay-for-service system, hospitals, labs, equipment manufacturers, and others make money every time someone is tested or treated for anything at all. More and more studies are finding that many tests lead to unnecessary treatment, waste money, and (even worse) cause more injury and death than they prevent. Unfortunately, limiting the number of tests and treatments available to patients is likely to be perceived as (shriek) rationing.

With our current system, we trust insurance companies to refuse payments for useless or harmful tests and treatments, but we know this does not always happen. When it does, clients fear they are being denied necessary tests and treatments. They fear this largely because it is sometimes true. Whether Medicare is expanded or not, we need better ways to evaluate what tests and treatments are beneficial, and we need better ways of educating patients on what is and is not beneficial.

Movements toward paying providers for results, not services, may reduce unnecessary and harmful services greatly. It may also force patients to become more responsible for their own health.

Finally

The only real imperative here is that we, as a nation, must decide whether we will provide access to healthcare for all our citizens. Once we agree that we will, we can begin to work out the most efficient and cost-effective means for achieving our goals. Almost no one in the United States is immune from the possibility of medical disaster and bankruptcy. This is a matter of caring for our fellow citizens, but it is also a matter of caring for ourselves.

On the 50th anniversary of Medicare, take a stand for healthcare justice.

Your health choked by the invisible hand of the market

R. Horton

Sometimes the invisible hand of the markets is all too apparent as it clutches us by the neck and strangles us slowly and painfully. If you are a typical adult American, you are likely to have at least one prescription for a drug indefinitely, either until you die or another drug is developed to replace it.

In the world of libertarian fantasy, pharmaceutical companies would compete to develop drugs we need to cure diseases that plague us. Hoping to sell us their products, they would race to develop effective and inexpensive drugs that consumers would rush to purchase. Unfortunately, those profits would be short-lived. People would buy the drugs, get well, and go about their business drug-free and non-contagious. Companies can make some money that way for sure, but it is much more lucrative to develop drugs that do not cure anyone but simply maintain their health.

This is why we have so many drugs for cholesterol, blood pressure, acid reflux, and other chronic conditions with fewer drugs aimed at eliminating disease, and even fewer aimed at curing (or even treating) diseases that affect those too poor to pay for expensive remedies. The fact that there is any treatment, even in early experimental drug trials, for Ebola is thanks to government funding of research. Left to markets alone, the diseases that kill the most people in the world would be completely ignored by drug companies.

Some diseases, such as Type II Diabetes, affect poor people, but drug companies spend quite a bit of time developing treatments for them. This, of course, is because enough people receive insurance payments from private insurance or Medicare and Medicaid to make treating them worthwhile. Almost 27 percent of Medicare beneficiaries 65 or older have diabetes, accounting for 32 percent of Medicare spending.  in 2002, Medicaid expenditures for people 20 and over with diabetes were estimated at more than $18 billion.

Of course, diabetes also affects people who are relatively affluent by global standards. In fact, it is considered a disease of babymotherdeathoverconsumption notwithstanding the fact that many who suffer from diabetes in the US are less affluent. Thus, it is extremely profitable for companies to develop products and services for diabetics in the US where their profits are underwritten by taxpayers. Diseases that primarily affect impoverished people in poor countries get much less attention.

It would seem likely that donations from individuals could fund research and development into alleviating disease. Indeed, the ALS ice bucket challenge raised more than $100 million as of this writing for research and treatment of ALS. But this again, leaves the allocation of resources to the mercy of marketing campaigns. ALS is a cruel disease, and it will only be a blessing if a cure can be found, but diseases that affect primarily impoverished individuals (e.g., malaria, antimicrobial resistance, trachoma) in the world are still waiting for a viral marketing campaign to draw attention to the millions that die from them. Market-based approaches drive money to those with the most influence.

In order to reduce the burden of diseases that affect the most people, we must provide research funds that are distributed where they will be most effective, rather than where the market funnels them. We need research centers funded by money offered with no conditions with the charge only to reduce mortality and relieve suffering. Such centers could be funded by government money or by individual contributions, but funding must come with no strings attached other than a demand for transparency from researchers as to how the money is used and what diseases are being treated. Some have offered solutions that would rely on industry to conduct research and develop products to alleviate suffering, but industry cannot be trusted with this task. Industry will always develop products to maximize profits, not minimize suffering.

The so-called “rugged individualists” in our society would argue that each person should have the healthcare he or she can afford, as income is a reliable measure of a person’s worth. Unfortunately, disease doesn’t attack people on the basis of merit. Honest and hard-working individuals can and do fall ill or become injured. Some are surprised by their turn of fortune. It is easier for a wealthy person to become poor than it is for a poor person to become wealthy, and disease and injury are great conveyors to the lower classes. Some, of course, are rich enough to be indifferent to the cost of healthcare or even long-term care. Even without working at all, these individuals will be housed, fed and treated.

People who work for their income, though, even in highly paid professions, are vulnerable to losing everything to healthcare costs. The “excellent” health insurance many people rely on is tied to employment and employment is tied to health. The unlucky ones who become ill lose both in a heartbeat. Bad luck isn’t a matter of bad choices or immorality; it is only a matter of chance. Libertarians argue, basically, that people should be responsible for the choices they’ve made in life, but libertarians also feel the government should protect people from events and circumstances out of their control. Thus, libertarians support the use of government funds to provide courts, police, and standing armies to protect the security of citizens.

The risk of disease and injury threatens us all. The question is whether we, as a society, should take responsibility for protecting all our citizens from this threat. If we don’t do this through government action, we must do it through collective action. Single-payer healthcare, such as all other developed nations have, is the most obvious solution to making citizens secure. Other solutions exist, and can be considered, but no one can prepare for catastrophe alone—collaboration is required.

We must provide funding for both medical research and healthcare. I am not asking you to provide healthcare for someone else. I am asking you to share the burden of providing healthcare for yourself. Sure, there is the chance you will never need it, but your chances are no better than anyone else’s. If we are not all secure, we are all insecure, we are at risk of being choked by the invisible hand. If we are insecure, we are not free.

 

 

 

 

 

On the 49th anniversary of Medicare, let’s work to expand it

R. Horton4 Comments

Medicare was born on July 30, 1965 primarily to help provide medical insurance for Americans over 65. As of 2012, Medicare covered more than 50 million people and it has succeeded in preventing many people from falling into extreme poverty in their old age. And of the 50 million covered, about 8.5 million are people with disabilities, who would not be insurable through private insurance plans.

Despite a few arguments, from the for-profit insurance industry, Medicare is financially more efficient that public plans (see a discussion here ). Even pro-industry arguments tend to highlight some of the advantages of Medicare. In this defense by Merrill Matthews for The Council for Affordable Health Insurance  of private sector insurance, for example, the author says, “Executives and boards of directors consider, debate and decide company policy; in Medicare that function is often handled by Congress and itmedicare for alls legislative staff. “ The authors point out that the time of Congress is also of some value, but the cost is borne by taxpayers. Of course, the time spent by private-sector administrator is also borne by those who enroll in their plans, but private-sector administrators are not accountable to taxpayers in the same way members of Congress are expected to be. The CAHI defense also points out that private insurance companies must raise money and include the cost of raising capital in their administrative costs estimates while Medicare does not include the cost of raising capital as that is done through Congress.

The real difference, according to Matthews’ argument, though, is in the amount of money spent on patients. Matthews points out that private insurance companies spend more money on administration because “they scrutinize individual provider claims much more closely, challenge questionable procedures and determine whether, in the company’s opinion, a claim is valid or needs to be reconsidered.” In other words, private insurers spend a lot more money denying claims. If you’ve ever experienced a major illness or injury, you have been bombarded with paperwork explaining why you will have to pay your own way with no reimbursement from your insurance company.

Matthews said that in 2003, Medicare spent $6,600 per patient paying claims, while private insurance paid only $2,700 per patient. This hits consumers in two ways. First, if you’ve already received treatment and the bill is denied, you are on the hook for payment. Second, the price of your premium includes the salaries of the administrators who are committed to denying your claims, so you are paying them to refuse payment for your treatment. If you think it is good that your claim was denied, leaving you with enormous medical bills after a serious illness, private insurance is the way to go. If you want to have some peace of mind that your bills will be covered, expansion of Medicare is certainly the best choice.

Nonetheless, it is true that Medicare payments need to be lowered. The costs of Medicare payments reflect the costs of for-profit healthcare. The costs can be lowered by enabling Medicare to negotiate the costs of medicine (drugs, hospital equipment, and other medical technology). The costs of common medical procedures vary wildly from city to city in the United States (to see a comparison of four services, look here). By bringing more transparency to healthcare costs, Medicare can pay providers what is reasonable, rather than what is currently possible. While many say that markets create competition that will lower prices, this is simply not the case. The reason it isn’t the case should be obvious to anyone: patients who need healthcare are in no position to shop around. After I had knee surgery in 2001, I had complications that some blamed on my choice of doctor. When asked why I chose this particular surgeon, I said, honestly, that I lay in bed with a shattered tibia, calling doctors for appointments. The doctor I “chose” was the seventeenth doctor I called. No, I did not carefully research his credentials, prices, or hospital admitting privileges. Even at that, I had to wait two days with a shattered tibia to get an appointment. This is the reality of for-profit healthcare and for-profit insurance. It is a nightmare. While Medicare may not be a blissful dream, it leaves fewer patients with healthcare induced night terrors.

Many people seem to have a false sense of security with their employer-sponsored health insurance. In the first place, they overestimate how much of their care will be paid for by the insurance. Then they seem to forget that any serious illness or accident that makes them unable to work will also make them unable to maintain their insurance coverage. The fact that your employer provides insurance today is no guarantee that it will be there when you need it. Further, under the Affordable Care Act (ACA), employers may reduce employees or hours to avoid providing healthcare, as discussed in this article in the Wall Street Journal. And finally, under the ACA may further restrict patient choices of providers, as noted in this piece in the New York Times.

Should anyone be at the mercy of employers for healthcare? Should small-business owners and the self-employed have to shoulder a disproportionate burden for healthcare? Medicare for All is an equitable solution that is fair to everyone and enables us all to pursue our vocations according to our dreams and talents rather than our fear of medical bankruptcy. The time to expand Medicare was 49 years ago, but let’s do it now. Support H.R. 676.

Additional Reading: For more resources on this topic, see the Public Health and Social Justice website.