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“I SORELY MISS the peace of mind that comes with universal health coverage.”
Those are the words of a 32-year-old woman from Canada, who is currently a PhD student residing in the U.S. When I read them recently in the comment section of a blog, they changed my thinking about health care.
I’ve been involved in health benefits, health insurance and health plans of various types since 1962. I’ve designed employer plans. I was on the boards of four health maintenance organizations. I negotiated physician contracts and health benefits with five unions.
I lobbied Congress for changes during Hillary Clinton’s attempt at health care reform, and keenly observed the Obama-era changes. I was shocked by some of the unrealistic promises made—and the spurious claims opposing—the Affordable Care Act.
Wherever we travel, I embarrass my wife by asking people about their health care. I’ve asked people aboard the ocean liner QE2, on a tour bus in Costa Rica, pretty much anywhere—it doesn’t matter.
I’m aware of the issues and claims regarding cost, rationing, waiting times, freedom of choice and all the rest. I know that no system is perfect. Every system struggles with costs, and some systems can’t deliver care in the timely manner we might expect.
But I also know from my interviews that many people in other countries are satisfied with their health systems. Why? From their perspective, the low or minimal costs they’re charged when they receive care provide them with “peace of mind.”
My retired friend in the U.K. now pays no premiums or copays for his care. He’s convinced his health care is free. That isn’t accurate. Still, he enjoys peace of mind about his health care costs.
In the U.S., 34% of the population is currently covered by a government-run system. Yet, if I mention universal coverage—even Medicare—there’s instant controversy. It makes you wonder, what do Americans want?
There will never be a perfect system—one that has no out-of-pocket costs, unlimited and immediate access to care, and no taxes paid to support it. But there’s also no logical reason the U.S. can’t have some form of universal coverage with a public-private partnership. Nudged by the Canadian PhD student’s comment, I think it’s time we provided peace of mind to every citizen.
Sometimes, when I discuss the idea of universal coverage with people who are adamantly opposed to changes, I’ve taken to saying, “Give me your ideas for something better.” I’m still waiting.
Excellent post.
Pulling healthcare out of the workplace would eliminate a some of the noise (read:cost) in the system… and help small businesses immensely. I think there are benefits to the US system: medical innovation seems to come mostly from the US (with notable exceptions of course). Cutting edge care is pushed to the front lines: If I’m a cancer patient, I think I want it to be in the US.
For many other things – it’s wasteful and wrong-headed. My wife’s knee issues are pretty consistent, and we know what works. Insurance keeps demanding pointless tests, wasteful procedures we know don’t work, and cheaper treatments that are ineffective. It would be cheaper just to treat her with what has proven successful in the past.
Also, the current process of health care delivery demands enormous administrative effort (and the cost that goes with it.) Heck, my wife has taken that over in many cases from the medical office due to their frequent errors, which are really painful when you are spending the kind of money we were (related to our son’s genetic disorder.)
My understanding is that the advent of for-profit insurance is also immensely wasteful. Medicare overhead is about 3.5%. Add 1% for administrative costs that are picked up in other government programs, and it’s really about 4.5%. Non-profit insurance overhead is about 4-5%. For-Profit insurance company overhead is 12-15%. Their true admin cost is also about 5%, but they spend 7-10% on ‘fraud prevention’, (which becomes denial of care in many instances.) Medicare mostly doesn’t bother with fraud prevention, yet their per patient fraud rate doesn’t seem any higher than for-profits. I could be wrong on that last point, it’s hard to get apples to apples data… but I think it’s fair to point out that when people point to Medicare fraud, well, private insurance has the same issue and doesn’t seem to deal with it much better.
If the US really is exceptional, we should be able to create an exceptional healthcare system that gives us the advantages of private market incentives but also provides a reliable base level of care for everyone.
Low administration is a two edge sword. Medicare has been criticized by government auditors for not spending enough on claim review and management and for having a high level of fraud, higher than the private sector. Medicare fraud can go undetected for decades.
Private insurance is criticized for too much oversight, pre-approval, etc. patients and doctors don’t like it, but they don’t like high premiums and lower fees either.
Medicare can get away with some of what it does because it can set fees much lower than the private sector and manage costs that way which leads to shifting of costs via higher fees paid by the private sector.
The reality is that most Americans are not covered by a plan that uses insurance. They are covered by any number of government programs or in the case of medium and large employers by self insured plans where the insurer acting as a claim administration for fixed fees has no risk in the payment of claims, no financial incentive to deny a claim as it were.
I agree we can and should design a better system, but that is not going to happen as long as both the for and against points of view spew false and misleading information and patients don’t see paying for health care as their responsibility and want everything they want and immediately.
The point of view and the acceptance of their systems is vastly different in every other country I have visited and asked people about health care. I’m still trying to figure out what makes Americans so different.
It would be interesting to know how fraud is measured across private insurers vs Medicare. I mean, Medicare fraud should be higher given the lack of review, but it’s unclear to me how the total cost nets out if you include the review costs to make an apples to apples compare.
Good point on the shifting of cost. I’ve heard that in many places, and from what I know of hospital finance, it’s in many cases a matter of charging what they think the customer can bear, which validates that claim.
Interesting about the self-insurance, I bet that’s not widely understood (it wasn’t by me, I went and checked my employer and yep, it’s a self insurance program.) I imagine the premium is then mostly going to the company self insurance fund? It’s also interesting what you said about incentives (we haven’t had issues with denial of claim, but we have had issues with the doctor’s prescription/recommendation being over-ridden.) I would presume there must be incentives built in for cost management? That’s an important nuance, I think.
Good information takes effort to accumulate, and misinformation is definitely an issue (plus a lot of facts are a lot less meaningful than they are purported to be. Not to get political, but a lot of people seem to think they understand complicated statistics when it comes to medical issues, when in truth their comprehension is very poor.)
One thing that seems unique to me about the US attitude towards medical care is how the Doctor becomes the center of everything – administration and malpractice costs seem more centralized around the doctor. In many other societies, it seems that while doctors are respected to be sure, they are held in less esteem than here, and they are less central in the ancillary aspects of care delivery.
I also understand that in the Czech Republic, they do have issues with people showing up far too often at Doctor’s offices with imagined ailments, in part because there is no charge (or at least, that was true at one point.) However there are a lot of models that involve some payment by the patient to keep a little skin in the game, and that makes sense to me.
I wish a larger part of this discussion was devoted to how to help lower the overall cost of healthcare. In the United States, 1 out of every 10 people have diabetes. Almost 1 out of every 3 people have pre-diabetes. Back in 2016, 36.2% of the American population was obese–I’m guessing that percentage is higher now after almost two years of being encouraged to eat ‘take-out’ food and having gyms and fitness centers closed.
https://obesity.procon.org/global-obesity-levels/
https://www.cdc.gov/diabetes/library/features/diabetes-stat-report.html
Think of how much healthier we’d be if our legislators weren’t beholden to Big Food and Big Pharma!
There are many components to the cost of health care, one you pointed out. The US has the highest obesity rate in the world other than some Island in the Pacific. To the extent obesity leads to health care needs that’s a factor and why comparing US costs to many other countries is apples to oranges.
But beyond lifestyle are factors like aging population, high use of expensive technology, high use of RX drugs, overuse and over supply of certain facilities like MRI, CT scan and such. Americans want not only service, but convenience and they want it yesterday. Go to another country and see if your hospital room has only one or two beds, not likely. Despite financial incentives to do otherwise, we overuse ERs as well.
From the 1940s forward with the growth of insurance and gradual expansion of covered services and decline in patient sharing costs have been out of control and adjusted to every tactic tried to control them. Now we are in a mode of shifting costs through HDHP, use of HSA, etc. Guess what that is not const rolling costs, it’s shifting the burden.
When I first got involved in health benefits in 1961, the only coverage was hospital for a certain number of days, physician services rendered in the hospital only and a fixed dollar amount per year for x-rays, lab work and chemo. Physician fees were based on a fixed schedule, not R&C. There was no coverage for outpatient care or prescription drugs. Needless to say as the coverage expanded so did the utilization and the cost.
From the fist visit to a physician the system takes over and the patient has little say in what happens and doesn’t want it for the most part. It’s like an oil company telling you what car to buy, controlling the MPG and telling you how many miles to drive each year and if someone else is paying all or most of the bills and you want you money’s worth for premiums you pay, you don’t care about the miles driven.
In 1961 in the UK we already had the NHS, with no charges at the point of service. Not for hospitals, not for out-patient care, not for doctors. When I moved to the US in 1975 I was astounded to have to write a check to my doctor – and that was with top-flight employer medical insurance. I have made sure to keep insurance, but now that I am on Medicare my out of pocket costs are ridiculous, partly because of one expensive drug that would cost me much, much less in the UK. The temptation to move back for that alone is considerable.
Replying to Mr. Quinn’s response. Medicare absolutely restricts care. For example, screening colonoscopy is a covered service every ten years for average risk individuals and every five years for high risk. I have a patient both of whose parents died of colon cancer. He wants a colonoscopy every year since he is so fearful of the disease. Can’t do it. It’s not covered. He then offers to pay me directly. I can’t accept his money since I’m a Medicare provider and that would constitute fraud. And Medicare not limiting access? You must be kidding. Try finding a primary care physician willing to take a new Medicare patient. And those long waits for specialists? With Medicare you’re a second class government patient while commercially insured patients are worked right in.
There you go, “he wants”. Let him pay for it then. But you say you can’t take his money. Is it good medicine simply to give people what they want as opposed to following good protocols? Since being on Medicare my wife has incurred hundreds of thousands in medical bills among different providers in different states. We sought out physicians with the best reputations in the country in one case. Only once did Medicare question one thing and that was a high number of visits to a chiropractor and rightly so.
In fact, when we go to a doctors office I frequently ask the staff which insurer is most difficult to deal with. They name one or two names, but always the easiest comes up Medicare, perhaps too easy if we want to manage costs.
My understanding is that Medicare covers a colonoscopy every 2 years (24 months) if you’re in the high risk category, which I am: Colonoscopy Screening Coverage (medicare.gov)
Richard, I enjoyed this article like most you write. Universal healthcare is a hot button issue that draws fire from many different angles. But here’s another thought.
I think free healthcare would allow “younger” retirees (50’s and early 60’s) to fully retire without the added health insurance cost. Most retirees now wait until 65 until Medicare begins to substantially reduce the price of healthcare.
How would our economy handle this brain drain of young retirees leaving the work force? I think it would be devastating to say the least. But maybe I live in the Humble Dollar “bubble” where early retirement is an afterthought for most people in USA. Thoughts?
Right now with heavy subsidies for Obamacare retiring early is less an issue, but I get your point. Somewhere around 62 or 63 still remains the most popular retirement ages. Of course as we know free health care doesn’t exist. But keep in mind Medicare is not cheap. The cost of Part B, Part D and a Medigap plan is over $400 a month sometimes more. That’s nearly $10,000 a year for a couple without any IRMAA charges.
As a physician I’d like to pass along a story about a young Canadian patient from Manitoba. He and his wife showed up in my office in Tennessee a couple of years ago. The young man had severe recurring abdominal pain, vomiting and weight loss. He had seen his Canadian GP who suspected something wrong and ordered an abdominal ultrasound. The wait would have been three weeks. The GP then advised referral to a gastroenterologist but that wait was to have been three months. The young people were members of a faith community and his wife got online seeking help and answers. A Good Samaritan invited the couple to stay at his home while getting medical care in the States. That’s how he came to be in my office. They told me that Canada would not pay for their care in the US and they had heard horror stories about the cost of American healthcare. I did an exam and had an inkling of what the problem was. I charged them $50 that day. He needed an endoscopy and CT scan, not an ultrasound. A local radiology group did the contrast CT and charged him $400 which he paid in cash. He was charged $500 cash for the endoscopy which included anesthesia, facility fee and professional fee. Did I mention that he had those tests within 24 hours of my initial visit? The diagnosis made, it was apparent he needed an operation. At that point an inpatient hospital stay with surgery for an uninsured patient would be cost prohibitive, even with cash discounts. I told the young man to get me the name of a Canadian surgeon in his locale. The next day I spoke to the surgeon and presented the case to him. He would see the young man the following Monday and operate that week. All in, that young man received the best of (timely) US healthcare for less than $1000 not including travel costs. I will leave you all to your own conclusions.
And what conclusion is that?
The US system is better than the Canadian system?
My sister needs to see a neurologist, she has been trying to get appointment for weeks, first available is December- in NJ. My wife had to change an appointment for eye specialist last week. Next appointment is after the first of the year.
I hope you don’t think your anecdotal story – or fees are typical. What if the patient didn’t have even a $1,000? I can tell stories of physicians billing $10,000 above the allowed insurance fee accepted by 90% of their peers. Not typical either.
As I said, every system has its limits and problems. That’s why we need to take the larger view of providing and paying for care for an entire country.
Medicare is a government run payment system. In no way does it limit care or inhibit access to care or cause wait times. Yes, it has problems, mostly cost related and yes it’s fee payments are relatively low, but that’s all part of the mix isn’t it? Something has to give.
Directing health care priorities by politics is not cost-effective as well as government incompetence in managing costs. To easy to pass the buck to taxpayers and award political spend parties.
I love the medical cost-sharing method. Enjoy the freedom of choice to award organizations that share your principles. No insurance or government overhead. HSA’s also a powerful tool to keep costs down. We should always have citizens pay for services. We need to have skin in the game. Free service as you say is not free and usually abused. Consumers learn to be angry to get served. Not good. Can you imagine the improvements in public ed if consumers had skin in the game?
And you have proved my point. But you see I know all those things.
First, the goal must be to cover 330 million people with cost sharing relative to their means.
HSA, skin in the game, managed care, making patients consumers don’t hold costs down, rather they create financial hardship for more than half of the population who have such plans. They merely shift costs.
The system is too complex, the choices too many. Workers and even retirees on Medicare are in fear of selecting the wrong coverage. I get calls every day from retirees trying to decide about supplemental coverage.
Skin in the game may work when buying just about anything but health care. If you or a loved one was seriously ill, are you going to seek the best care or the best price?
I lobbied Congress against both Clinton and Obama plans pointing out all the things you mention and more. The goal can’t be a perfect system because there isn’t such a thing.
But we have to ask why only Americans among developed nations can’t come up with a system that works for every citizen. That’s pretty hard when you have the ignorant with no viable ideas of their own throwing around “death panels,” “rationing” and memes showing granny being thrown off a cliff.
Many people hold to the idea that nothing should come between patient and doctor about care decisions. That’s fine – maybe – if the patient is paying the bill and not asking others to pay as part of an insured group. And then there is the fact somewhere around 25% of care provided is unnecessary or questionable. More care is not necessarily better care.
Part of the problem is that politicians and pundits and advocates won’t tell the truth, won’t lay out the tradeoffs, the realities, the costs and that no system is unlimited or instant.
Most people have no idea how insurance works, but naively accept false rhetoric about profits and CEO pay driving up premiums.
Heck, we don’t even define affordable.
When you say “HSA”, I believe you and Fleeb are both referring to an HDHP (high deductible health plan) An HSA is simply the savings account component – not the insurance. (I realize you already know this , but I’m just clarifying for other readers.)
Let me add some real-world context as a HDHP member for 11+ years: I love many aspects, except for the total lack of cost transparency.
I never know the real cost of anything from office visit to procedures, etc in advance, so I can’t intelligently “shop”. Providers and insurers make it virtually impossible to get any care costs ahead of time.
Providers claim it all depends upon what’s needed and we won’t know that until after you visit (by then it’s too late – you owe the $ – and it’s often far more than expected).
Insurer tells me they can’t provide any pricing info – I have to get that from provider. Every provider has a diff rate, of course and the difference is astounding.
Recently, a particular test was $200 at 1 place and $1500 2 blocks away. I only found this out after hours online and via phone chasing down info and deciphering a 1/2 dozen medical codes. Many times, I’m not as lucky and just resign myself to whatever I’m billed, since I need the care.
Factfulness, by Hans Rosling, is a wonderful read for understanding why it is so hard to talk about a problem like this. He makes recommendations for how to work around our worst human tendencies to get to clarity and make progress.
Rosling, who had a long career in public health, also touches on how the U.S. spends more than twice as much per capita on health care as other wealthy (level 4) capitalist countries (~$9,400 vs ~$3,600) and yet we can expect lives that are three years shorter. We spend more on health care per capita than any other country in the world, but 39 countries have longer life expectancies.