Need More than a Universal Health Care System: Grassroot Participation Is Important

Like many in the United States, I am interested in the health care issues we face. In TIME magazine’s latest poll among the under-30 voters, the main concern for 62% of the respondents is the ability to afford health care coverage. In our current economic environment, employment does not guarantee access to health care. I visited the Blogosphere to update myself on the latest thoughts and developments in our health care issue this week. The first post I found, “Health Insurance Can’t Be Optional,” was published by Louise Norris, a co-owner of a health insurance brokerage company, Insurance Shoppers Inc., in Broomfield, Colorado. She discussed the implementation of a universal health care coverage in Massachusetts and favored a mandatory subscription. In the second post, “A Modest Proposal For Reforming the Health Insurance Industry" Winston Apple, author of the book Edutopia: A Manifesto for the Reform of Public Education, promotes an idea of catastrophic health insurance as a means to expand coverage and reduce health care costs. I offer my comments on the author's blogs as well as below.

"Health Insurance Cannot Be Optional"
Comment:
Massachusetts initiated a new universal health insurance system using a combination of incentives and penalties to get citizens to sign on (see image on the right of Mitt Romney signing Massachusetts Universal Health Care law). Massachusetts residents who are uninsured as of December 31, 2007 will lose their personal exemption – worth $219, when they file taxes in the spring. If they continue to lack health insurance into 2008, they will be taxed 50% of the price of the least expensive health insurance plan available. According to a report in the Wall Street Journal in February 7, 2008, only half of the previously uninsured currently enrolled; and no less than 20% did not qualify for subsidies and were granted exemptions because the costs were too much of a hardship (note the per capital money income of Massachusetts is reported as $25,952 for 2006). One lesson we could learn from here is that, in spite of government intervention, the cost of health care coverage in the U.S. could still be unaffordable. In the real world, it is difficult for us to acquire something that is not affordable. On the other hand, I would agree that health care coverage cannot be universal without a mandate, which may result in garnishing someone’s wage for failing to obtain health insurance coverage. Using the liability auto insurance as a parallel to present the logic of a mandatory health care insurance coverage for every U.S. citizen may not gain broad support because U.S. citizens have a choice of not owing an automobile.

The issue of affordability arises from the fact that everything has a price. Massachusetts’ mandatory health care insurance is costing the government about $158 million today, and is projected to reach $1.35 billion by 2011. On the other hand, Massachusetts is expected to incur a $1.2 billion budget deficit in 2008. To balance the budget in 2011, some other areas of government services, e.g. education may have to face deep cuts, or the tax needs to be raised. The current economic slow down will not help increase government revenue without new taxes. I believe health care reform in the U.S. will take a gradual approach, and it is going to be built upon the system we already have. In a few years' time, we will learn from the Massachusetts experience, what are the facts and myths of a universal health care system - its promises, the cost of delivering the promises, and the effect on people providing the health care services.

"A Modest Proposal For Reforming The Health Insurance Industry"
Comment:
The catastrophic illness plans are interesting, but may not contribute much to solving the problem of providing coverage to those currently uninsured. The product idea is not new, insurance companies do offer "high-deductibles" to cater to individuals who have affordability problems. If it is not mandatory, not all car owners may buy liability insurance. Our "health care" crisis is not just a health insurance crisis. In reality, health insurance companies are becoming the popular whipping boys. They are blamed for inefficiency, and bureaucracy, and being profit-minded (Blue Cross/Blue Shield are not-for-profit) at the expense of patients' well-being. We are not sure if we can safely remove the roles of insurance companies from our system without creating another form of crisis. Substituting the insurance companies with a government body may not be a better solution, as seen in the public transportation system or our public education system.

The aging population, the availability of more expensive advanced technology that treats diseases that were terminal previously, and even economic growth all contributed to our rising health care expenses as a nation. In the book entitled "The Fattening of America," by Eric A Finkelstein and Laurie Zuckerman, as shown on the left, it was reported that over two-thirds of Americans are overweight or obese. Over the past three decades, the number of obese Americans has more than doubled, across the socioeconomic spectrum, and for all racial and ethnic groups, most dramatically, for America's children. According to Eric, America's growing waistline is a by-product of our economic and technological success. It has been estimated that the annual cost of overweight and obesity in the U.S. is $122.9 billion, a sum that is comparable to the economic costs of cigarette smoking.

All health care crises have to be tackled on all fronts, and as you pointed out, reform could involve a grassroot movement. You suggested that we should band together to limit the role of insurers with or without help from the government. On the positive note, grassroot organizations have already started to direct the effort in discouraging smoking, addressing obesity, and adopting a healthy lifestyle. These are sure steps in bringing health care burden under better control in the long run.

Reforming the American Health Care System: Build on What We Already Have

Unlike previous years, youth participation in this year’s presidential election is very strong. TIME magazine in its February 11, 2008 issue listed "fear factors" in the polls conducted among the under-30 voters. At the top of the list, 62% of the respondents were concerned about not being able to afford health care; which was an even bigger concern than not being able to find a stable, well-paying job (ranked third at 58%). Their concern can be understood against the background that 47 million Americans, or 11% of the population, were without health insurance in 2005 (see chart to the left). According to the Henry J Kaiser Family Foundation Employee Health Benefit 2006 Annual Survey, a third of firms in the United States did not offer health care coverage. Due to high insurance premiums, many small employers cannot afford to provide health benefits. Employment is no longer a guarantee of health care coverage. Reforming the U.S health care system involves both expanding the coverage and controlling the growth rate of expenditures, which will result in better affordability. This efficiency can be achieved by improving every aspect of the health care chain and requires collaboration among the stakeholders in the system.

Although many people presently expect Congress to establish a cost effective health care system for all workers and their families, regardless of existing health, income level, or employment status, like other developed nations (as shown in the map on the right), this idea is not new. In his State of the Union address on January 5, 1949, President Harry Truman called for a nation-wide “system of prepaid medical insurance which will enable every American to afford good medical care.” More than fifty years later, we have yet to see the proposal become a reality. It has a lot to do with our culture, which embraces consumerism and capitalism. Within such a culture, patients want choices, and care providers look for returns. We allow market forces to allocate resources. Therefore, it is not surprising if the U.S. has a higher per capital number of health care professionals and high tech equipments.

Any universal coverage does come with a heavy price tag. According to the February 7, 2008 report in the Wall Street Journal, Massachusetts’ mandatory health insurance is costing the government about $155 million a year, and is projected to reach $1.35 billion by 2011. On the other hand, Massachusetts is expected to incur a $1.2 billion budget deficit in 2008. To balance the budget in 2011, some other areas of government services, e.g. education, may have to face deep cuts, or raise taxes. Moreover, we must realize that the universal health care system has shortcomings. It does not guarantee the quality service and access to a needed health care specialist in a timely manner. The bureaucratic inefficiency does exist in a universal health care system as it is in a Health Maintenance Organization (HMO) set-up. The U.K and Canada started their Universal health care system in 1948 and 1984 respectively. In the Commonwealth Fund 1998 International Health Policy Survey, 10% of the public in Canada and the UK said they did not get needed care in the past year, comparing to 14% in U.S. respondents. In the same survey, 47% of the Canadian respondents said it was very difficult for themselves or family members to see a specialist or consultant, comparing to 40% of U.S. respondents. In addition, market feedback continues to show significant percentage of people in Europe pay out-of-pocket to see specialists, avoid long waiting rooms, get MRIs, or see a doctor who is said to have a better training or personality.

There is no lack of proposals as to how to improve our health system. Preventive policies can lower expenditures. A report published by Commonwealth Fund in December 2007 examined 15 federal policy options that have the potential to lower health spending relative to projected trends. They include policies that would use better information for health care decision-making (which I separately address in another post), promote health and enhance disease prevention, align financial incentives with quality and efficiency, and correct price signals in the market. According to the authors of the report, “combining [these] policies would capture the synergistic benefits of individual changes.” The savings could amount to $1.5 trillion in national health expenditures over 10 years, while also improving value in terms of access, quality, and health care outcome. In the U.S., substantial costs to the health system are related to care of chronic diseases, such as diabetes or heart disease. Reducing tobacco use and prevention of obesity would potentially save the system $191 billion and $283 billion respectively over 10 years. Individuals taking wellness programs and living a healthy lifestyle would help lower the rate of growth in treatment expenditure. However, resetting the price signals is a delicate task in light of the shortage in primary-care doctors and the potential shortage of general surgeons as the population grows, according to the recent AMA data. Complicating the challenge is another growing trend that the quality-of-life issues are changing younger doctors’ attitudes towards practice options (which I discussed in my post under Reform or Innovation: Common Sense Should Prevail). Under these conditions, any radical reforming approach may create more new problems than it intends to solve initially. There is no magic bullet to fully address rising costs and inefficiency in the system; every stakeholder has to play a part to improve through gradual innovation.

After the election year rhetoric settles down, the government can build on the existing health care system. The sooner we address these challenges, the earlier we will see the benefit. Funding our long-term health care needs, by raising taxes will not . Any reform will lead to consumers directly feeling the pinch in their wallets, each time they utilize the system. Hopefully, this may lead to individuals assuming a bigger responsibility in pursuing healthy lifestyles and making choices for preventive treatment or care. Government assistance should always be the last resort for those who fall through the cracks of the system.