America’s Healthcare Crisis: An Interview With Gerald Balcar
As 2007 begins, the leading domestic issue in the United States is healthcare. The costs in America are by far the most expensive in the world, but it produces the worst results among the developed member nations of the Organization for Economic Cooperation and Development. America is unique in the developed world in that it has no reliable, accessible and affordable source of healthcare for every resident. The United States has not made comprehensive healthcare available to all its people, which has been accomplished by every other industrialized democracy.
Healthcare in the U.S. has evolved into a complex and financially threatening crisis. The costs of insurance premiums and out-of-pocket expenses, including deductibles and copayments have risen, forcing middle class families to make painful and sometimes tragic choices. Only in the United States can sickness lead to financial ruin. Illnesses have pushed families and individuals into bankruptcy or into poverty. The high costs of health insurance for employees have burdoned American businesses by reducing the ability of many to compete in world markets.
The quality of healthcare in America has suffered, and professional morale and motivation have fallen sharply. Physicians and hospitals find themselves regularly in conflict with insurance carriers over diagnostic procedures and treatments and trying to collect their bills. Most practitioners find their incomes falling. The pricing of servicesis utterly confusing at the apparent instigation of the health insurance companies.
As plaintiff lawyers pursue lawsuits, premiums for professional liability insurance have escalated, forcing physicians out of some specialties and some locales. A phenomenon known as “defensive medicine” has become a prevalent practice. Doctors order more tests and procedures to protect themselves against illicit claims.
Facts are an essential element of an appropriate national conversation or debate. They can be contested but not answered with political rhetoric. The facts demonstrate that enourmous amounts of money will be saved in the U.S. by implementing universal healthcare, which is practiced so broadly throughout the industrialized world. The claim that America cannot afford universal healthcare is factually wrong.
Under the complex and chaotic American system, a multiplicity of health insurance companies exist. American businesses carry a major share of the health insurance costs. The insurance industry argues that American free enterprise will solve any problems of access and quality. They justify the high costs as simply those needed to provide America with the quality healthcare and technological advances expected of American institutions.
These claims have long been a part of the resistance to reform disparities of access to American healthcare. The facts of the matter are as follows:
- The people of the United States paid 109% more for healthcare in 1998 than the average of the next nine largest industrialized democracies (the “comparison nations”). This reached 112% in 2002 and was 123% in 2005. The U.S. per capita cost was $6,553, and the comparison nations’ average per capita cost was $2,944 in 2005.
- A World Health Organization Survey of Healthcare System Performance in June 2000 found all of the comparison nations to be superior to the United States. France was first; Japan was third; and the U.S. 38th.
- In the ultimate measure of medical effectiveness, Potential Years of Life Lost Before Age 70, in 2001 the U.S. was worst among the developed nationsand all but the two developing member nations of OECD.
- Between 1990 and 2002 in the comparison nations, healthcare costs as a percent of GDP rose 28.9%. In the United States, however, the increase was 67.8%. The real (after-inflation) healthcare expenditure increased by 78% in the comparison nations and 160% in the U.S.
There are many purported explanations of the high costs and the unsatisfactory performance of American healthcare. The main reason is that a large number of American patients arrive at the doorstep of medicine much more seriously ill than they should be.
It is popular to believe that only uninsured Americans might be affected by an inability to access healthcare. The number 45 to 46 million is most often used. Many believe that even the lack of insurance does not impede such people getting care. Our multidisciplinary study shows that at least 102 million people are uninsured or underinsured and cannot get timely primary or preventative care. Without early diagnosis and treatment more become ill, disabled or even lose their lives with “care denial induced illness.”
- The Centers for Disease Control and Prevention reports that chronic conditions account for 75% of healthcare expenditures. Many of these conditions can be prevented and managed with primary care and early intervention. Others have suspected the possibility, but none have realized the magnitude of the costs from $370 to $430 billion in 2005 borne by businesses and taxpayers.
- THe excessive and reversible administrative costs paid in 2005 by physicians, clinics, and hospitals due to the American adversarial system of multiple payers, plus insurance companies and HMO administrative expenses and profits, are estimated to have been between $190 and $210 billion in 2005.
- American liability laws encourage patients to sue doctors and hospitals, which increased costs by $70 to $90 billion in 2005. The morale of professionals at all levels is undermined by reduced incomes and escalating professional liability premiums.
- The massive flow of cash in healthcare has motivated Wall Street interests to develop new strategies to profit from health insurance and healthcare delivery.
When uninsured and underinsured people in America cannot access the medical care they need, particularly primary care, they get very sick or die from manifestations of chronic conditions, complications or untreated acute diseases. Much of the costs of their treatment is at public expense. Nations that provide universal access to healthcare recognize that it is significantly less expensive to provide preventative and primary care to all, compared to treating illnesses that result from not providing these services.
The global competition of pharmaceutical, surgical, diagnostic, hospital equipment and medical supply producers has yielded remarkable results - the miracle of modern medicine. Care delivery, however, has historically been one of community service focused on the best possible care for patients. The market-driven model of competition in the delivery of healthcare has been a dismal failure.
Health insurance at one time was in fact something like insurance. Owners’ policies felt protected from a disaster if illness. Now the hospitals and doctors obtain permission to order diagnostic or treatment procedures usually after intense arguing. Even so health insurance premiums have increased sharply in recent years. Many physicians feel beset by constraints. American healthcare has become complex, confusing, cumbersome and chaotic. American insurance companies now act as middlemen in the dispensing of payments, taking a cut of the action.
In the absence of universal healthcare, plaintiff lawyers seek large settlements in professional liability actions, which include covering present and future medical costs. With universal healthcare the medical costs would be covered and the multi-million dollar settlements would become unnecessary. WIth universal healthcare and professional review plaintiff claims could be reduced to pain aind suffering or disability issues and professional liability premiums redeuced to earlier levels.
Professor Jon Oberlander of the University of North Carolina recently wrote, “Most international systems did not control costs until after they had achieved universal coverage.”
Debate or a national conversation about American healthcare requires an understanding of facts and evidence from other countries where many decades of experience demonstrate that healthcare for all is affordable, desirable and achievable.
1. Thesis: lack of access to health treatment prior to the onset of a crisis by the uninsured and underinsured leads to significant cost in the system.
2. Supporting data
3. Metric we should be measured by and compared to other OECD countries: The potential years of life lost before age 70.
Discussion
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