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The high cost of the American for-profit/market-medicine healthcare system is belatedly becoming an election issue in the US, while some progressive states are now taking insurance companies under public control.
Even some corporations are looking northward at Canada as they are getting fleeced by for-profit healthcare.
Meanwhile the number of uninsured has increasing massively as are the number of medically related bankruptcies. In the latter particularly amongst the elderly...
An interesting article in today's Guardian highlights the higher costs, bureaucracy and administration involved in the crazy manner of this public good's delivery.
Can you afford to be ill?
Medical treatment in the US can lead to endless wrangling over bills. Now it is becoming an election issue.
April 11, 2007 11:00 AM
[.....]"Nine million children without health care," blasts a Democratic Party TV advertisement. Yes, that's nine million American children without healthcare in one of the ... no sorry, the most advanced industrialised economy in the world. This in a country which is literally bleeding itself into the sands of the Middle East. No wonder that many Democrats are making health care one of the big campaign issues. No wonder, too, that some of the more progressive New England states are bringing in a form of state-backed health insurance, no longer prepared to wait as the big private health lobbies ritually halt any change to a system that does not work.
Just in case any of the pointy-heads who run any of the corporate-sponsored so-called British think tanks are in the process of wining and dining government or opposition ministers and spokesmen, here is something to stiffen the resolve of faint hearts who can't see the profound merits of the
National Health Service.....
Astonishingly this sort of thing happens regularly - and often for much larger amounts. Imagine being taken to casualty with - say - a broken leg, which could set any private insurance company back over $60,000, but in great pain, you forgot to ask the surgeon which insurance company he operated under. Imagine being insured, but still being forced to pay the bill because you had failed to ask the most important question. This is precisely what happens to thousands or ordinary Americans all of the time.
In the United States a costly operation can lead to a home being re-possessed or bankruptcy. In the United States, the non-insured can get basic treatment, but not specialised treatment, and in the United States, even if you are insured and injured, fight off the anaesthetist, even if you have lost both legs, at least until you know who is going to, er, foot the bill.
Also check out the below, form The Journal of the American Board of Family Practice, on the higher costs of these for-profit plans. Of course this is Harney and the PDs' trajectory here.
The Corporate Transformation of Medicine and Its Impact on Costs and Access to Care
http://www.jabfm.org/cgi/content/full/16/5/443
[.....]HMOs
About two-thirds of HMOs are for-profit corporate organizations. For-profit HMOs are typically driven by the market with a strong focus on managing costs rather than care. This is in marked contrast to not-for-profit HMOs, such as Kaiser Permanente and Group Health Cooperative of Puget Sound, with their more socially oriented emphasis on prevention, patient education, and cost-effective, evidence-based care.
Proprietary HMOs attempt to "cherry pick" the market; avoid sicker enrollees; erect barriers to specialist referral, costly diagnostic tests, and hospitalization; and divest themselves of high-utilizing physicians who order too many tests or spend too much time with patients.29 Compared with not-for-profit HMOs, for-profit HMOs have been documented to have higher disenrollment rates,30 lower patient satisfaction,31 and worse quality of care.32,33 For example, a national study of investor-owned HMOs in 1999 found that they scored worse on all 14 quality indicators than not-for-profit plans.32
For-profit HMOs aggressively sought out profits over care during the managed-care era of the 1980s and 1990s. While charging high overhead for administration and profits (25 to 33% for some of the largest HMOs),34 their everyday denials of care led to a public and legal revolt against their abuses.29,35–38 Instead of their claimed benefits of increased competition in the marketplace, consolidation of fewer, larger HMOs led to oligopoly with reduced competition.34 The controversial role of the primary care gatekeeper became discredited, and barriers to specialist care were lowered under public pressure. The trade-off, of course, was higher premiums to enrollees, increased disenrollment rates, and interruptions in continuity of care for many patients.
These examples reflect typical behavior of for-profit HMOs counter to the public interest:
[......]
Nonprofit HMOs, such as Kaiser Permanente, are now facing adverse selection within its aging population as for-profit HMOs continue to "cherry pick" the market by offering lower cost plans with more limited benefits to healthier enrollees.46
Insurance Industry
Most of the country’s health insurers are for-profit and many are investor-owned.47 The health insurance industry has followed the same trend we have seen among hospitals and HMOs—mergers, consolidation, and oligopoly. Large national insurers (eg, Aetna, United Health Group, and Cigna) dominate the group market, whereas Blue Cross-Blue Shield (BCBS) plans dominate the individual market.47 The original concept of socially responsive health insurance, as pioneered by Blue Cross in the 1930s with community rating (ie, same coverage and premiums for enrollees throughout the covered community, regardless of individual risk), has long since given way to an actuarial model of health insurance whereby premiums are based on enrollees’ individual risks. Almost half of the nation’s BCBS plans are now for-profit.48 Most health insurers now practice "medical underwriting," whereby premiums are reassessed on a regular basis, with big increases or disenrollment if covered persons or groups get sick. Before the 1970s, that practice was considered unethical.49 Risk rating allows insurers to avoid coverage of the sick and maximize profits, thereby voiding the basic concept of insurance to spread infrequent large losses over a wide base.47 It allows insurers to avoid coverage of higher-risk groups and persons, transferring their care to not-for-profit providers and the public sector.
In the aftermath of the backlash to managed care, hospitals, HMOs and providers continue to battle insurers for higher reimbursements as insurers continue to hike premiums and pass along the increased costs to employers and consumers. Health insurers are still experiencing double-digit profit growth, and a recent Goldman Sachs release expects that trend to increase over the next 2 years.50
That for-profit versus not-for-profit makes a big difference is shown by this recent finding: in California, the 2 largest health insurers are Kaiser Permanente (not for profit) and Blue Cross (for profit); in 2000, Kaiser spent 96% of every premium dollar on medical care, whereas Blue Cross spent just 76% on medical care.51 Figure 1 shows the market increase in overhead costs charged by investor-owned insurance plans compared with Medicare and not-for-profit Blues....
Figure 1. Private insurer’s high overhead. Investor-owned plans are worst. Source: Schramm, Blue Cross conversion, Abell Foundation, and CMS.
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Originally Posted by Kevin Doyle
