Issue Position: Healthcare in America

Issue Position

Introduction

Sometimes the Internet is accused of being a bad source of information. If you need proof that the accusation is justified, just try looking for information about healthcare. Fabricated "evidence" on one web site becomes the proof on another. I'd like to be able to say, "Look, this is a lie, that's the truth." But why should you believe that I'm the one telling the truth and not the one telling the lies? What do you do when two people are screaming "liar" at one another?

In this article I will settle for citing a relatively small amount of key evidence from sources that I am reasonably certain are unbiased - like United Nations studies. Of course, someone will immediately shout that the U.N. is an anti-American, communist front organization and you can't trust anything it says. Try to remember that "anti-American, communist front" is a slogan, and one you would expect from someone who has trouble fitting his conclusions to the evidence.

After presenting just a little data, I will turn to pointing out that the hundreds of slogans that have determined healthcare policy in the U.S. are not based on evidence. In fact, it often turns out that the opposite of the slogan is the truth. There are simply too many of these slogans to be included in the slogans list on the home page.

Until the Affordable Care Act was passed, the loudest argument over healthcare was over whether to adopt a "single payer plan". In a single payer plan the government collects all the money paid by potential users of the healthcare system and makes all the payments made to healthcare providers. If the providers are also government employees (as in the United Kingdom), the system is referred to as "socialized medicine". If the providers are private hospitals and clinics (as in France or Canada), the system should not be called "socialized". Most supporters of a single payer plan in the U.S. show relatively little concern over whether or not the system is socialized, and generally advocate a single payer plan with private providers.

Step 1 -- State the Evidence

Here is a short version of the evidence that is most frequently cited.

There is little argument that health care in the United States is expensive. We spend approximately twice as much per person for health care as other industrialized countries. U.S. government expenditures, alone, would pay for universal health care in other industrialized countries. In other words, if the U.S. ran its health care system like Canada, it could provide full coverage to every American with little or no increase in taxes while eliminating everything Americans pay to health insurance companies along with direct payments to healthcare providers. Under the present system, 41 million Americans are uninsured, and millions of others are insured with deductibles and copayments that are not easily borne.

There is a good deal of argument over just why health care is so expensive in the U.S. However, these arguments serve mainly to obscure the debate. For a list of possible causes of the high costs, click here.

It is sometimes argued by libertarians that deregulation of the health insurance industry would make it more efficient and less costly. As it is in no way clear what regulations are driving up costs, it seems difficult to make a case for deregulation. The idea that private enterprise is always more efficient than the government is just a slogan. (See "Big Government Is Bad Socialism".) Clearly, one of the factors driving healthcare costs is the huge bureaucracy, not of government, but of health insurance companies.

Supporters of single payer plans also claim there is evidence that the U.S. healthcare system is not only expensive, it's not good. They may point to the low life expectancy and high infant mortality in the U.S. as evidence. Critics, on the other hand, claim that insured Americans have access to the best medical care in the world.

It is true that life expectancy and infant mortality are not necessarily good measures of quality of healthcare. There are simply too many other variables that affect life expectancy and infant mortality. However, there is other evidence that does not make the U.S. healthcare system look good.

The "amenable mortality rate" gives the rate of deaths prior to a certain age which are considered by experts to be avoidable through appropriate healthcare. For example, the "certain age" for type 2 diabetes is 50 years, because prior to 50 years the disease is almost always treatable. The amenable mortality rate may still be influenced by matters outside the healthcare system. However, it is better than measures like life expectancy, and most of the outside influences may be removed by considering the rate of change in amenable mortality. In a 2002 study of 19 countries in the Organization for Economic Co-operation and Development (OECD) the U.S. had both the highest rate of amenable mortality and the lowest rate of decrease in amenable mortality. (Source: E. Nolte and C.M. McKee Health Affairs, Vol. 27, No. 1 pp. 58-71 ).

There seems to be a notion that the U.S. offers advanced procedures that are unavailable elsewhere. That is not the case. The fact that the U.S. has more MRI or CT scanners may only reflect wasteful redundancy by hospitals that feel they need to have all the latest equipment to compete. Advocates of single payer healthcare would add that the equipment is used unnecessarily on those who have health insurance in order to pay for it, while those without health insurance may be denied access to it when it is needed.

A test of the claim that the U.S. has the best medical care for those who can afford it might be made by comparing remaining life expectancy at age 65. This test might be more informative because Medicare gives most Americans over 65 access to healthcare. In the U.S. remaining life expectancy at age 65 is above the OECD average but below that of top performing countries such as France or the Scandinavian countries.

There are studies that directly compare patient outcomes for specific diseases across countries - for example, five year survival rates of patients with stage 4 breast cancer. Such studies avoid the effects of variables outside the healthcare system. A large number of these studies compare outcomes in the U.S. and Canada. They generally favor Canada. Of 10 studies that are large and have appropriate statistical controls for such variables as patient age, five favored Canada, three were mixed or neutral, and two favored the U.S. A good review of the available evidence has been produced by the Urban League and the Robert Wood Johnson Foundation. (How Does the Quality of U.S. Health Care Compare Internationally? by Elizabeth Docteur and Robert A. Berenson. If it hasn't moved, you can find it by clicking here.)

Overall, it is clear that the healthcare available to well-insured Americans is not superior and may be inferior to that offered in other countries.

Critics have other concerns with single payer plans as follows:

Slogan 1: It is often necessary to wait for some services such as elective surgery. Delays may be as much as three months in single payer countries.

One of the characteristics of single payer plans is that they are given to effective self-evaluation and their failures are easily discovered. Accordingly, complaints about delays in the Canadian system tend to be exaggerated because there have been improvements in Canada's care over the last decade.

More importantly, these complaints ignore delays in obtaining care in the U.S. These are particularly conspicuous for patients seeking care for the first time and effect non-elective procedures, not just elective surgery. In Canada, for example, a patient needing to see an ophthalmologist is examined promptly. In the U.S., such a patient with macular degeneration could loose his or her eyesight waiting for an initial appointment.

Slogan 2: Patients in single payer plans cannot choose their own physician. This is an especially strange claim because patients in single payer plans can choose any physician or hospital they want. It is patients in HMO's or PPO's in the U.S. who do not have a free choice.

Slogan 3: Socialist medical programs have "death panels" that decide what care elderly people can get. The costs of medical care are potentially so high that someone has to set limits on what care you can have in any system. The question is: Who do you want making those decisions - a panel of physicians or the warm hearted CEO of your insurance company?

Slogan 4: Our government is too corrupt to run a single payer plan efficiently. In fact, Medicare runs as efficiently as any foreign plan with the caveat that Medicare is prohibited by law from negotiating drug prices with drug companies.

Slogan 5: If we only pay as much for drugs as foreign countries pay, development of new drugs will suffer. Where's the evidence? Single payer advocates point out that most significant drug development is already government funded university research. Drug companies typically become involved in the last stages of development. Much of the effort of drug companies is devoted to working around the patents of other companies. (Once has Pfizer has a cash cow like Viagra, Eli Lily has to have Cialis.) From some points of view, the amount the government spends on work that leads to pharmaceutical company patents is outrageous.

There is one outlier in this discussion. The French medical care system was described by the World Health Organization, in 2000, as providing the best overall healthcare in the world. It is often lumped in with single payer plans. However, while it provides universal coverage, it has multiple nonprofit payers for different groups of people depending on occupation. However, the government regulates everything, including the fraction of income paid to the nonprofits and the payments made to physicians. The cost of the French system is somewhat higher than that of single payer plans but still much less than the cost in the U.S.

Step 2 - Evaluate the Evidence

It seems evident that Americans pay an excessive amount for a healthcare system that provides ordinary care for most of its citizens and inferior care for many others. What should be done depends on one's attitude toward universal coverage. If universal coverage seems desirable, it can easily be achieved while decreasing costs. If universal coverage is not seen as desirable, then there is no model to follow and no evidence as to what the outcome might be. Let us assume we are generous enough to prefer universal coverage.

Step 3 -- List the Options

Adoption of any existing single payer plan (or the French system) would create universal coverage at something close to what the government is already paying through Medicare, Medicade, Veterans Administration hospitals, and other military service healthcare providers. A small increase in taxation might be needed to cover the relatively high salaries of physicians (compared to other countries of similar wealth). This could be covered, for example, by a 4% addition to the payroll tax, though some more progressive tax might be desirable (see also "Wealth and Taxation"). (Note that while physicians in other countries earn less, their educations are paid for by the government.)

Step 4 - Prioritize

As healthcare now costs 25% of our gross domestic product, it is a serious issue for all Americans. As adoption of a single payer plan saves money, there do not seem to be any competing interests other than those of the investors in insurance companies, and of health industry employees who would lose their jobs. The economic interests of investors in insurance companies are significant, but as they are invested in companies that can be seen as having colluded to produce high profits, those interests seem secondary to those of the general public. Many employees who will lose their jobs are already health professionals, such as nurses, who can readily find work elsewhere. All widely circulated single payer proposals known to me provide for economic support and retraining of others who lose their positions.

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