Friday, August 21, 2009


Of all the developments that surround the health care debate today perhaps the most frustrating is the nonsense and abject ignorance tied to the growing belief in Death Panels (people need to learn to read the proposed legislation), health care on demand for illegal immigrants (again, learn to read), and the spooky “government takeover” of health care, which is little more than gruel for the conspiratorial Black Hawk Helicopter / Waco Conspiracy / Birther crowd.

Seriously. At what point do we start laughing at these people?

Then again, the Death Panel-Government Takeover discussions are exactly the type of red herring conversations the insurance industry and the republican party has always wanted. The insurance industry wants it to maintain profits. The republican party wants it because they understand that if President Obama delivers real reform in the health care arena they may find it hard to emerge from the political woodshed for an entire generation.

While the republican-insurance industry goal of maintaining the status quo appears to enjoy the tactical points handed to them by FOX News, Rush Limbaugh, and their internet brethren, there are several points that can, and must, be addressed.

We need to understand - as economist Paul Krugman pointed out - that to the extent that a majority of Americans are happy with their health insurance it’s due primarily to three factors:

1) The federal government already covers the elderly, our military personnel, and our military veterans through Medicare, military hospitals, and the Veterans Administration.

2) Private firms and employers are subsidized ($246.1 billion in 2008) by the American taxpayer so that they can provide “private” health insurance.

3) Government regulations forbid private employer insurance plans (again, they are subsidized) from discriminating against employees with previous health conditions.
Still, the state of our current health care system is not good. Here's why.

Rising co-pays, skyrocketing premiums, denial specialists, and being suddenly being dropped from coverage because of “pre-existing” conditions, that can range from pregnancy to acne treatment, have combined to make our health care system a field of financial land mines. You never know when your coverage will blow up in your face.

Worse, the managed care system we have for the non-military and 65 and under crowd – which has been crafted by the medical and insurance industries, mind you – is three times as expensive as other industrial nations (it accounts for 16% of our GDP).

If this weren’t enough, health care coverage isn’t available to well over 44 million Americans, while health care in America is NOT close to being the “best in the world” (more on this below). The primary reason for this is that the goal of our insurance industry driven system is profit maximization, not health care.

Apart from giving Americans less health bang for their medical buck, our current health care system also acts as a competitive drag for Corporate America. The total cost of paying into our current system is at least 30% higher than what America’s commercial competitors have to pay around the world. This undermines corporate America’s competitiveness abroad, and costs Americans jobs, as discussions surrounding Detroit’s automakers made clear earlier this year.

At the same time American workers are afraid to leave jobs that provide health care. This not only undermines labor mobility in America, but it works against what Adam Smith (capitalism’s patron saint) said was crucial for capitalism to prosper in any economy. All of this helps to explain why American companies have started to push for what George Lakaoff says should be an American Plan (Americare?) that provides universal health care.

Indeed, our current system is so dysfunctional that Physicians for a National Health Program have called for universal health care and put out a series of studies that show:

* Canadians are healthier and have greater degree of access to health care (American Journal of Public Health).

* Administrative costs consume 31% of all private health care costs in the U.S., which is far higher than the 2-3% absorbed by Medicare’s “bloated” bureaucracy (New England Journal of Medicine).

* Half of all bankruptcies in America are from medical bills, in spite of the fact that over half of all families filing for bankruptcy for medical reasons have insurance (Market Watch).

* 60% of all health costs in America are already publicly funded (Harvard University).
With reference to the latter, consider this: Tax credits for corporate and other private health care programs, combined with what we pay to underwrite health insurance for federal employees (the Federal Employee Health Benefits Program), means that we’re already paying for a National Health program. We just don’t get the benefits.

How bad is it? As I pointed out in a previous post, in a recent study of five industrialized nations America is “dead last” when it comes to providing quality health care to it’s citizens. Specifically, in spite of spending more (by far) on health care than any other country on earth, we lag behind other industrial countries when it comes to life expectancy, MRI units per every thousand people, and infant mortality rates, among others.

It’s gotten so bad that in the case of infant mortality, America is currently ranked #45 in the world, and lags behind the likes of Cuba, Greece, and Portugal. My question is, When will the "We’re # 1 / Sanctity of Life" crowd begin to show up in this health care debate?

And, yes, I support the public option.

- Mark

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