Health Reform - Reality

In my previous commentaries I talked about Health Insurance Reform because I saw the problem as being primarily one of insurance. Too many people are uninsured. Those who are insured often don’t get coverage when they most need it. The expense of insurance is astronomical and going up.

But as I study the problem in ever greater depth I have begun to realize that I have been looking at the tip of the iceberg. Insurance is only a part of the problem and I have concluded not the major one.

I have concluded that the cost of our medical delivery system is astronomically expensive and going up and while the inefficiencies of the private insurance companies are contributing to the problem they are not the primary cause. But the situation has been a problem since the time of Teddy Roosevelt and has now become nothing short of a crisis, which unless dealt with endangers the economy of the United States. If nothing is done health care is on a path where in a relatively short time it will bankrupt the country.

Let me repeat: If nothing is done health care is on a path where in a relatively short time it will bankrupt the country.

This is truly not a Republican or a Democratic problem it is in words of our President “an American problem.”

Fidelity Investments, a brokerage and Mutual Fund company, is not a political organization and certainly not a Democratic or a liberal one. Its mutual funds total $1.57 trillion in assets.

They write on their web site:

“The rising cost of health care in the United States represents a significant threat to the competitiveness of U.S. businesses and the fiscal sustainability of government finances.

“Reform that reduces the rate of health care inflation is critical to the long-term prospects for the U.S. economy.”

They go on to say:

“Health care expenditures have risen at more than twice the pace of overall inflation since 1970, …the United States spends far and away more money on health care …than any other country in the world. Health care spending makes up 15.3% of GDP compared to an average 8.8% for developed countries.

“…aggregate health statistics, such as life expectancy or infant mortality, are worse in the United States than other developed countries despite the extra expenditure. This is the essence of the problem: health care costs are rising more quickly than GDP, tax revenues, business sales, employee wages or any other measure of national, public, or private incomes. At this pace, health care will continue to consume an ever larger share of public and private sector resources. …it represents a large expense with inflation rates that are unsustainable.”

For Republicans to oppose change is irresponsible. To oppose reform by the use distortions and lies is inexcusable. To resort to comparisons to the Nazis or to euthanasia is despicable.

We probably should consider one of the systems that work, whether the British, the Canadian or the Swiss or any other as long as it controls costs. For an article that debunks some of the lies and myths about these systems see here.

For reasons that are incomprehensible to me, that is politically impossible.

An American single payer system like Medicare is the next best solution! A public option follows close behind. But, and this is directed at my liberal friends, reform of some kind is essential and the proposal, which seems to have support in the Senate, that if state co-ops or other programs failed to meet certain cost and coverage goals in five years, the president could create a public plan on a fast track without threat of a Senate filibuster has a lot to commend it as a compromise. 

It is not sensible to adopt the Republican approach of “My way or the highway.” Reform may have to be piecemeal, but we cannot forgo a start because it falls short. Time is short and neither inaction nor delay is an option.

The insurance companies, who have been the most effective entity in blocking reform in the past, make good villains. But they are doing what all business entities do in our capitalist system. They will fight to protect their profits and a review of their profits shows them not to be outrageously profitable. What they are is outrageously inefficient. According to Locker Gnome, Aetna, United Health and Tenet have profit margins of 3.85%, 4.1%, and 2.63% respectively, compared to e.g. Microsoft at 24.93%, Exxon 8.98% and Apple at 14.97%. But their inefficiency is most likely due to the huge amount spent cherry picking healthy people, denying insurance and claims to people with pre-conditions, and finding other causes for not paying claims. If the Health Reform legislation forbids these practices we will not only get people who are now uninsurable, insured, and get insured people reimbursed for their expenses, but we will have taken a huge step forward toward a better system.

 It doesn’t solve all the problems, but a half loaf is better than none, and we must guard against the perfect being the enemy of the good. Fighting for a public option is one thing, but making it the sin qua non of health reform, serves only to strengthen the hand of the enemies of all reform. Sometime it is better to win a battle and live to fight another day, than to gloriously go down to defeat, and lose the best opportunity for reform we shall see for a very long time. Right now liberal forces in sniping at the President are doing a disservice not only to Health Reform, but to all the other reforms that will follow once this battle is behind us.