National Health Care - The Data

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        It is astounding the degree to which rightists oppose the ACA, while accepting, as perfectly reasonable, the idea that they can be (and should be) required by their state government to purchase auto insurance as a prerequisite to driving.  The concept behind the ACA is very little different. If you want to live and work in the United States, buy health care insurance. Just like auto insurance, there are many levels one may choose to protect oneself, and just like auto insurance, there is a minimum standard. The sole difference is that one can choose not to drive, therefore avoiding the requirement to purchase insurance. If one could guarantee their health for their lifetime and then promise to drop dead of a stroke without incurring any medical expenses, then we might exempt them as well. In reality, that isn’t the way it works and, just as with auto insurance, the uninsured cost us all more money because they opt not to maintain coverage but continue to drive. In the same manner, there are those who continue to get sick or injured and use medical services paid for by the rest of us.

This is not me defending the ACA, because a) it’s  private commercial insurance, ergo “for profit.” and b) doesn’t assure the same standard of treatment for all. So, establishing that the ACA mandates private insurance, and ergo is not the dreaded “Socialized Medicine,” let’s examine what socialized medicine really is, since many obviously labor in ignorance on the issue yet throw the name around like it was synonymous with “the plague.” I choose to do this by examining several issues which seem to be central to the health care discussion no matter what the system. In no particular order:

       First: “What is the real cost per person for healthcare under the various systems and what factors determine this issue?” Again, plainly – which is cheaper and why?

        Second: “If, as opponents of the ACA proclaim, the US’s health care system is truly the “finest in the world,” what standards are used to measure that statement; is it true, and why or why not?” Simply put is the statement true, and how do we know?

         Third: “What is the satisfaction level of persons who live under the various (public/private/single payer) systems of health care insurance?” In plain speak, what percentage of persons in various nations are satisfied (and how satisfied) with the healthcare they have?

On the first issue, cost, there are numerous factors, not obvious to most, and grossly underplayed by the affluent.

        The “under the radar” nature of much tax-financed health spending in the United States hides the truly regressive pattern of government funding. Highly visible Medicaid spending benefits the poor; while much less obvious, but growing, tax subsidies benefit the affluent who are most likely to have employer-paid coverage and whose higher marginal tax rates translate into greater tax savings. For instance, in 1998 (some time ago, but statistically relevant to today) federal tax subsidies alone averaged $2,357 for families with incomes above $100,000 but only $71 for families with incomes below $15,000. Under the most recent tax laws, that gap is wider by a significant amount. 

        Other factors relating to cost have little or nothing to do with real medical issues, rather are tied in with the costs of doctors dealing with a myriad of payers, formulae, paperwork and procedures. The term “single payer” simply means that all medical billing and compensation originates from one source. In most of Europe’s industrialized nations, that source is the government via some form of national health care service. While the ACA does provide for universal coverage, it certainly is not a single payer system, since it throws all health care responsibility short of Medicare/Medicaid to private sector insurers, and for lowest earners, provides some degree of subsidy. Make no mistake, this is your tax dollars channeled to private insurers!

Needs no interpretation, does it?

        There is one relevant study, done in the United States by the Lewin Group, which analyzed the effect that would be seen in Minnesota, as a sample population group,  of single payer insurance for all citizens. We are speaking here of an example based on the premise of no one in Minnesota paying for health care insurance, per se. This is probably also a good time to throw out the real cost figure, nationwide, for health care in the United States. How much is good health care worth to you? $8,233 per year? That's how much (2012 figure) the U.S. spends per person (higher now!) The Lewin Group study analyzed the projected cost of universal single payer health care in Minnesota for 2014 compared to the same health care delivery under the ACA.

        The study found that single payer (“government health care”) would cover all Minnesota residents and reduce total health spending by $4.1 billion, or 8.8 percent, in 2014, and would save $189.5 billion from 2014-2023 over what health care costs in Minnesota would be under the Affordable Care Act (ACA).  The plan would cover most medically necessary care with the exception of home care (excluding what is now covered by Medicare) and nursing home care, and would eliminate most cost-sharing, except for some small co-pays on specialty care and medications (medications for chronic conditions would be excluded from cost-sharing).  Lewin estimated that single payer would save employers currently offering coverage an average of $1,214 per worker and save an average of $1,362 for families.  Employers not currently providing coverage would pay an additional $1,963 per worker annually.  Single payer could be financed with existing sources of taxpayer funding for health care (including subsidies from the ACA) combined with an average 7.2 percent effective payroll tax on employers, a 3 percent income tax on family adjusted gross income, and cigarette ($1.00/pack) and alcohol taxes (5 cents per drink). Understand, this is a savings to every person or entity at every level of the health care pyramid, with no diminution of care or services. Even after the cited sources of revenue, the savings are significantly more with a single payer system!

Note that, as shown by the graphic below, health care costs, while increasing world wide, are doing so a lot faster in the USA

        Another oft cited “statistic” is that the tax burden (or the percentage of tax spent on health care) is higher in nations with single payer systems. True? No, it isn’t. The following is a list of the average health care spending per capita for several nations which now provide single payer health care to all citizens: the UK - $3,483, Australia - $3,670. Canada - $4,445,  Germany - $4,338. These figures are total public and private spending in each case. Breaking it down for the UK, for example, average per capita health care spending is $3,483 total, of which about $200 is private spending, the rest public. The percentages of public and private spending vary; Australia has slightly more private spending as a part of the whole, as does Germany. If these dollar figures seem like a lot per person, remember, the total health care spending per capita for the United States is $8,233! That figure is about $3000 per capita more than Norway, which is the only nation in the world which spends more public funds per capita (about $600 more) on health care than the US. Remember, however, Norwegians spend almost nothing in private funds.

        To pound the point home, consider this. The United States spends almost exactly $4000 of that $8,233 figure in public funding but spends another roughly $4,000 in private funding as well. Again, the US spends over twice as much per capita from both public and private sources as does the UK, and roughly 250% as much as the average for developed nations worldwide, the great majority of which have some sort of single payer health care system.   

       

        An often heard cry from the far right is that private industry is inherently better at administrative functions than a Government bureaucracy. Evidence from OEDC countries shows that the private sector is far more bureaucratic and much less efficient than the public when it comes to providing health care. The US pays, on average, $911 per capita per year on administrative costs, while Canada pays $270. When considering insurance overhead costs the numbers are even more surprising. Blue Cross/Blue Shield of Massachusetts, fairly typical of US health care insurers, employs 6,680 persons to administer benefits for about 2.5 million customers. Canada employs significantly fewer to administer benefits for more than 28 million! (and their clients are five times as happy) This is "apples to apples" as all this is done electronically anyway. Germany recently shifted dental services, formerly publicly funded, to private sector insurers and saw three times the admin costs almost immediately.    

        Dealing with my second point: Obviously, if we spend all that much more, we should be truly proud of our status as the nation with “the best health care system in the world.”  Is it, and is it worth the money? That figure of $8223 per capita from all sources is more than two-and-a-half times more than most developed nations in the world, including relatively rich European countries like France, Sweden and the United Kingdom. On a more global scale, it means U.S. health care costs now eat up 17.6 percent of GDP. A sizable slice of Americans -- including some top-ranking politicians -- say the cost may be unfortunate but the U.S. has "the best health care in the world."

        Statistics might give one cause to reconsider that! We must have more doctors right?  Let’s compare the US to the 33 other member nations of the Organization for Economic Co-operation and Development (OECD) -- an international economic group comprised of 34 member nations. It must be noted that while this includes nations such as Norway and Sweden, it also includes Turkey, Greece, Portugal, Poland and Mexico! There are fewer physicians per person than in most other OECD countries. In 2010, for instance, the U.S. had 2.4 practicing physicians per 1,000 people -- well below the OECD average of 3.1.

        So, not only do we have fewer doctors per patient, we have fewer facilities. The number of hospital beds in the U.S. was 2.6 per 1,000 population in 2009, lower than the OECD average of 3.4 beds. But we must surely be healthier, right? If only!

        While it’s true that life expectancy at birth increased by almost nine years between 1960 and 2010, that's still less than the increase of over 15 years in Japan and over 11 years on average in OECD countries. The average American lived 78.7 years in 2010, more than one year below the OECD average of 79.8 years. Remember, we are comparing a wide range of nations, some rich, some poor, several former Soviet Socialist Republics.

        So, on to the last of our three inquiries - that of user satisfaction. If we believe our system is the best there is, shouldn’t we be the happiest people in the world regarding health care? As it turns out, there is no shortage of surveys and studies dealing with this topic. Canada does them, the UK does them, fact, the EOCD and World Health organization do them, as well. One of the most general surveys, a 2011 Deloitte Group  Global Report, asked several relatively simple questions and got some rather revelatory answers. To the question proposition – “rate your health care system on a scale of A to F,” the percentages who rated their systems either A or B were: Canada 50%, UK 46%, France 51%. The USA return was 22%, higher then only Mexico, Portugal and Brazil! Only Mexico had more respondents who believed that “50% or more of health care system spending is wasted.”  Only Brazil and Portugal had fewer persons who were “satisfied” with the performance of the health care system.

The "takeaway" here is that 6 times more Americans than Britons believe the health care system needs complete revamping. The graphic also indicates that a whopping 75% of Americans think the system needs at least "fundamental change" (Congress are ya listening?) 

         Let’s compare apples to apples with our closest neighbor, Canada. Forget the anecdotal stories, since all health care systems have them (you know, like the man several years ago in Tampa who had the wrong foot amputated?) by actual surveys of Canadians, and records of the national health care system, Canadians are more likely to receive needed care quickly. They also get more physician visits, more immunizations, more hospital admissions and more surgical procedures. This is, admittedly fairly recent improvement as the system has grown. A survey of 10 OECD countries showed that Canadians were the most satisfied with the care they got and Americans were the least satisfied. (this data supported by the Deloitte Group Study as well.)

        Canadians are five times as likely to be satisfied with the health care they receive than Americans. Before the introduction of Canada’s Medicare (national healthcare) infant mortality, maternal mortality, and life expectancy were worse than in the US. Today, Canada’s infant mortality rate is 70% of the US figure, maternal mortality in Canada is now half that of the US, and the average Canadian lives 2 years longer than the average American!

        As I stated, there are numerous anecdotal  health care “horror stories” which are frequently used out of context to slam single payer health care without the recognition that these types of stories abound in the most privatized instances as well. One need look no further than the fictionalized, but too realistic story in John Grisham’s “The Rainmaker” where the private insurer’s first ploy every time is to deny a claim. A truly meaningful statistic, in an EOCD study, is the percentage of Americans (16%), far more than in any other OECD nation, who report having difficulty paying medical bills and having to sacrifice other necessities to do so.

        So, in summary, the lies of the far right notwithstanding, the Affordable Care Act is not in any way, “Socialized Medicine” It isn’t. No, it’s not. Period. Having said all that, and considering all the facts herein, would it be such a bad thing if it were? Would the deficit be lower if we spent half as much of our GDP on healthcare? Would an increase in healthcare user satisfaction by a factor of five be a bad thing?

        The fact is Medicare is efficient by comparison to the most streamlined private insurers, a fact they’ll never tell you. The fact is that several very loud voices in the health care debate have hands in the pockets of major insurers, which is another problematic issue. When Senator Ted Cruz screams about the ACA, know that his wife is a high-level executive with a major Southwestern health care insurance provider.  Also realize Ted Cruz was born in Canada and has (if he wants it) free health care.

         Single payer national health care simply makes sense, economically, and morally. As a final note, there are those in the UK (around 10% ) who refuse to wait for anything, unlike waiting two to four weeks for a non-emergency cardiology consult, which is about the national average in the US, higher for other specialties.  They can buy additional private insurance at a small fraction of what it would cost in the US (like as an example, a woman age 33 would be able to buy supplemental private insurance for a whopping $35 -50 per month with an up front annual exclusion of the first $320 dollars. This annual co-pay/exclusion is about a month’s worth of expense for the best US employer provided plans. Private insurance generally doesn’t cover primary care; but might get a patient to a specialist sooner (no guarantee, but either may well be faster in several specialties than in the US). Most patients, however, seem relatively satisfied with their publicly funded general practitioners  and most GPs make enough money that they don’t seek more work. Around 90% of UK citizens use national health care exclusively and are far more satisfied with their level of care than their US  counterparts, on average.

       The sad truth is that the health care crisis in America will probably not ever be resolved with only the best interests of all health care consumers and the most economical use of public funds as the prime motivator. As long as the same powerful lobbying interests that crucified Hillary Clinton in 1993 and opposed and continue to oppose the ACA continue to have first dibs on the ears of legislators, private interests will always come first, and 95% of us will lose to the 5% who benefit from private insurance. What is perhaps the most troubling aspect of this whole thing is that there are some persons, very vocal in the fight, who just aren’t very bright. They take advice and guidance from moneyed insurance interests and accept all that they are told on face value. Pity, that!