U.S. health care: The crisis continues
One of the curious aspects of the Affordable Care Act is that it continues the ongoing practice of making health care less affordable for healthcare consumers, formerly known as patients.
The morbid evidence abounds: On Aug. 12, the Wall Street Journal reported that, “Under pressure to squeeze out costs, some of the U.S.’s biggest health insurers are quietly erecting more hurdles for patients seeking medical care,” such as requiring doctors to seek prior authorization from insurance companies before treating a patient. This reinforces the core maxim of the profit-based health system: Things can always get worse.
A 2008 Kaiser Family Foundation survey revealed that in 2007, 72 million non-elderly adults (72 million!) had accumulated medical debt or had difficulty paying medical bills—and 61% of those having difficulty paying bills had insurance. The mounting burden reflects the grim fact that premiums have nearly doubled since 2000, rising three times faster than real wages. Additionally, each year sees increasing deductibles, co-payments and out-of-pocket expenses. Ominously, people are now going to the doctor less frequently. In a recent interview, WellPoint Inc.’s chief financial officer noted that, “People just aren’t using health care like they have. Utilization is lower than we expected, and it’s unusual.”
Unusual, but hardly unexpected as people forsake health care in order to pay other bills. This is hardly surprising given that medical costs for low income people with no insurance or inadequate insurance can reach 60% of income, a fine figure assuming that people don’t have to eat, pay rent, put gas in their cars and buy clothes for their children.
Far beyond any other country, the U.S. spends nearly a fifth of its entire annual national income, or GDP, on health care, on a system that the World Health Organization (WHO) ranks 37th in the world, better than Slovenia at 38th, but inferior to Costa Rica at 36th, a country with a per person income that is only a quarter of that of the U.S. And Portugal, a country not exactly known as an advanced industrial superpower, is ranked 12th by WHO. There is something rotten, and it isn’t in Denmark, a country also ranked above the U.S.
Americans needn’t suffer such a burdensome, flaw-ridden system. Take the case of Japan, a country that spends about $2,500 per person per year on health care as opposed to $7,500 in the U.S., yet it manages to have a system ranked 10th in the world, one that provides universal coverage—even to illegal aliens.
But aren’t the Japanese waiting in long lines for medical care and using antiquated technology? Not at all. In fact, on average, Japanese patients see the doctor 15 times a year. That’s five times as often as Americans. The Japanese get three times as many MRI scans, and contrary to the American myth that the cloud of an expensive system has the white lining of abundant, modern technology, Japan’s system has a higher number of MRI and CAT scan machines than does the U.S.
And there are even better indicators of the robustness of the Japanese system—the actual health of the people. T. R. Reid of Newsweek put it nicely in 2010: “The Japanese have the world’s longest life expectancy and the best recovery rates from just about every major disease. Infant mortality is less than half the U.S. rate. Japan usually leads the world in rankings of ‘avoidable mortality’—its effectiveness in curing diseases that can be cured.”
We seem to have a conundrum. How can the Japanese provide a system that’s superior in coverage and quality than the American one, yet do so at only a third of the cost? It’s simple—fees are carefully regulated by the government. As Reid puts it, doctors are “comfortably middle class, but not in the country club set.” An MRI scan that costs $1,400 in the U.S. comes in at $130 in Japan. Think how many more people in the US might seek needed scans if they knew the bill was going to be $130 instead of $1,400 or $800 as I recently paid even though I pay $4,000 annually in premiums.
Abundant personal tragedies accruing from the dysfunctional American system have their counterpart in social tragedy. As witness to this, let’s assume that the more just, humane and successful Japanese system could be adopted in the U.S. for not a third of the cost of the current system but for half the cost. The savings would still be nearly $1.5 trillion not over 10 years, but EVERY year. The “opportunity cost” of squandering such vast resources is staggering and can be measured in schools that won’t be built, green energy projects denied, infrastructure renewal postponed, and even necessary consumption foregone by low income households—or even deficit reduction after more pressing needs are met.
It’s also timely to point out the cynical hucksterism of the Mitt Romneys and Paul Ryans of the world. They peddle the noxious notion that the nation has a Medicare funding problem, that the “reform” of benefit cuts and gradual privatization are unavoidable. The examples of Japan—and France, and Italy and the UK and Norway and Germany and Sweden and so on—show that the U.S. has a healthcare funding problem, NOT a Medicare funding problem. That is, the crisis ensues not from the fact that government finances health care for the elderly but from the relentless profiteering of insurance companies, pharmaceutical companies, and healthcare providers. The system is putting a needless burden on millions of people every day, and every day 123 people in America die because health care is out of reach not just from lack of insurance but also from its relentlessly growing cost.
The struggle continues.