November 8, 2009
National Health Care ReformBy Howard J. Warner
Unfortunately, those who are about to decide the future of our health care system have no care delivery experience. They also have the hubris to think that they can write a 2,000-page law that will handle all future contingencies for a complex segment of our economy.
I must offer some explanation of my background as a disclaimer. I am a practicing dentist in upstate New York. I presently buy medical insurance for my family and have provided it for some of my staff. I am a member of Rotary International, a past president of a local Lions International club, and President of the Board of Trustees of my synagogue. I spent two years participating in medical research at Washington University and the University of Pennsylvania. I taught biochemistry and practiced public health dentistry in Dover, Delaware for two years. Although I did not major in economics, I did take economics classes at Washington University. I spent a year in a dental residency in Wilmington, Delaware. While I am not an expert, I have a greater appreciation for this complex issue than many of our leaders, most of whom are lawyers that have never treated a patient or run a business.
First, I must say that we should establish the problem so that we may work on a solution. The history of the health care insurance industry dates to the period immediately following World War II. Price controls were in place, salaries were fixed, and businesses could compete for labor only by offering health care insurance. The government established the system 65 years ago. Now the leaders want to change the system. They have tinkered with it over the years, but now they want to alter it completely. Why? Because these leaders want to establish a new health care delivery system for their own political purposes. They have exploited the growing national fear over the escalating cost of health care masquerading for the delivery of health care. I will agree that the system has several faults: too costly, unequal distribution, special interest groups, and political forces which are prepared to do battle without explaining their endgame.
Where do the political leaders get the authority to take over the health care system? If we search the Constitution, the only clause that they could cite is the right "to regulate Commerce ... among the several States" found in Article I, Section 8, which details the powers of Congress. The Preamble declares the need to "promote the general Welfare." Our elected officials also cite "that they are endowed ... with certain unalienable Rights, that among these are Life ..." as found in the Declaration of Independence. These arguments are weak. Congressional power traditionally has been limited to goods and services crossing state lines. The states have the power under the Tenth Amendment to control issues within their borders. During the Korean War, President Truman ordered Secretary of Commerce Sawyer to take over the steel industry under the general emergency power given the President in Article II. However, the Supreme Court ruled in 1952 under Youngstown Sheet and Tube Co. et al. v. Sawyer that Truman did not have this authority. If such a takeover is illegal in wartime, how could it be acceptable during peacetime? However, our leaders will not be stopped by this argument, so we still have to examine their programs.
Those advocating health care reform point to the many uninsured people in the country. They give numbers ranging from 40 to 50 million. They never explain how this number is calculated. If we accept it as correct, we still need to know the makeup of the total. Anywhere from 10 to 20 million are illegal aliens or undocumented workers. Health care advocates would claim that illegals have been specifically omitted from coverage in the bills in Congress. However, the Supreme Court ruled in 1896 that aliens are entitled to legal protections under the Fourteenth Amendment in Wong Wing v. U.S. The ruling was expanded in 1950 under Johnson v. Eisentrager and then further extended to provide free schooling for illegal immigrants in Texas in 1982 under Player v. Doe. Eventually, illegals will be given health care coverage. So if we are covering 30 to 40 million people not insured now, how much should this cost? The Congressional Budget Office says that the plans before the legislature should cost between $830 billion and $1.6 trillion over ten years. That is $20,000-$40,000 per person per year, which is 4 to 5 times what the most expensive plans cost today. Reformers argue that a federal plan would save money, but the government plan saves nothing. However, this won't stop the politicians.
Let us examine the different plans. The leaders say that they need to make the system more competitive. The easiest way to do this is to allow insurance companies to compete across state lines. Presently, each state decides who can compete and then regulates the companies. This raises the cost of care. Each state places demands upon the individual insurance companies. This drives up the cost of coverage. I agree that the insurance companies strive to make a profit and limit losses (as non-profits), sometimes limiting payment for treatments. Do state and federal regulations reduce the costs? In my state of New York, under community rating it is illegal for insurance companies to sell policies based on risk assessment, so younger and healthier individuals pay the same premium as older or less healthy persons. This high cost is cited by younger individuals who refuse health coverage and choose to use their discretionary income in other ways.
So how do we limit the cost of health care as it grows beyond our ability to pay for it? There are only two ways to do this: limit treatment or limit reimbursement for care. Is this improvement for the patient? Robert Reich, the Former Secretary of Labor under President Clinton, has stated that some would be allowed to die during the last months of life in order to minimize spending. Surely Medicare costs must be controlled, but is this the best way to accomplish this goal?
Some versions of the legislation limit insurance companies from soliciting business. Could any business survive under these conditions? But then that is the purpose of all these efforts. Whether a "trigger" or a non-profit cooperative will be included, the aim is to limit the private sector over time. Over forty years ago, the same approach was taken in Canada. Today, the scarcity of technology and equipment in Canada results in long waiting lines for many procedures. Many Canadians travel to our country for treatment. In fact, a former Health Minister came here for her cancer treatment. Presently, American insurance companies negotiate with hospitals and physician groups over reimbursement. If the government establishes plans, the rules will eventually favor the government to the disadvantage of insurance companies, forcing many out of the market. Not only will our choices decrease, but many jobs in that industry will be eliminated along with the resultant tax revenues for local, state, and federal governments. Is a single-payer system best? But that won't dissuade our leaders.
What about the argument that we are the only industrialized country without a national government health care program? That is not true. We already have government-run health care: the Medicare plan for seniors and the disabled. We are told that there is at least $200 to $400 billion of waste and fraud in this program to help pay for the new plan. If politicians have not eliminated this waste in the past, why would they do so in the future? Why put so much faith in these leaders? Many other countries have a two-tiered system in which the public gets national health care while the wealthy and those in the government pay for health care that is available only with private insurance or cash. We already have this kind of care. If the cost for insurance increases, some would lose this coverage. Who would they be? Could some lose their employment through the increased costs? Under any system, there would always be a form of scarcity -- either by availability or through cost. We also have government care through Medicaid, state and federal public health agencies, the Indian Health Service, municipal and state hospitals, military services health care, the CHIP federal program for uninsured children, and the Department of Veteran Affairs. Many states offer programs for children and the working poor, among them New York, Massachusetts, Hawaii, and Oregon. We should examine the successes and failures of such programs. We should also limit the fragmentation and resultant higher costs caused by so many programs.
How did we get to the point where a few political leaders meeting in private in the Senate Office Building and the House Office Building can decide our national medical treatment options? They want to be protected from the pressures of the public. Where is their expertise? Have they consulted medical practitioners? Maybe, they don't want the public's opinion. Maybe they want our money and to exercise control over us.
There are alternatives, but our elected officials don't want to hear about them. One way to control costs is to return the doctor-patient relationship to the marketplace. This way the third party does not control the choices for care. The health savings account system offers the best way to restore the old relationship. Under this approach, a high deductible would exist and cause patients to use an account to pay for items until the deductible is reached. Any unused funds could be available for the person to use in retirement. Costs above the deductible would be reimbursed by the insurance company. The patient then decides whether care is received based upon the benefit to that individual. Some cannot manage their finances well enough to use this approach. It is not for everyone, but then we do not have a "one size fits all" plan now. Variety is the American way. Uniformity is the way of Europe and socialism.
We need to do something, but in our zeal to control costs, we should not throw out what works. We have the best technology in the world. This is due to the tremendous amount of our gross national product that goes to health care -- about 17%. The cost is growing at an accelerated rate. What is an acceptable percentage of GNP for health care? What is more important than health? This growth is not sustainable indefinitely. However, the government makes arbitrary decisions. Who would want to be the patient that is denied care as the expenditures exceed bureaucratically imposed guidelines?
We are told that we need to change our system to increase competitiveness internationally. Will this happen? Not if we increase the cost of health care. Certainly increasing taxes will result in higher costs. In the present plans, there are penalties on business that do not provide insurance; penalties on individuals who do not have insurance; taxes for cosmetic procedures; increasing income taxes on higher wage-earners; taxes on higher-cost health insurance plans provided by unions, school districts, and governments; and taxes on stock and bond transactions. How will this make our companies and industries more competitive with the rest of the world?
How well will the government system work? Let us look at other programs. Since the Clinton administration, the annual flu vaccine has been purchased by the government. This was initiated to reduce costs to about two dollars per dose. The principle underlying this decision was limiting drug costs through a single federal payer. From five or more producers we now find only one or two domestic companies prepared to undertake this effort. We found it necessary during some years to order vaccines from foreign producers due to shortages. Reducing the costs has resulted in limited willingness by manufacturers in this country to assume the civil liability risk. Now the federal government must help insure these companies. Can we trust bureaucrats for our health care?
We must examine the unintended consequences of national health insurance. Presently, private patients provide the bulk of payments for the system. Private insurance reimbursement for similar procedures exceeds that of Medicare. Medicaid reimbursement does not cover the cost of providing care, but it keeps the system fully occupied. If there is a reduction of the private insurance sector, who will make up the lost income to health care providers? If the loss is not made up through some form of subsidy, then service will be compromised. What will happen to smaller or rural hospitals? They will not be able to provide the same high-quality service that patients have come to expect. Health care delivery and quality will not be as good as what we currently enjoy.
We often hear how preventive care will bring down the cost of health care. Individuals who eat well and exercise regularly experience fewer illnesses. This is a societal lifestyle decision which can be made regardless of the health care delivery system. However, preventive care results in more regular visits to the health care provider. This means more undiagnosed illnesses may be found early, resulting in more effective care. Dentistry is an example of this phenomenon. With more regular care, the cost of care has increased steadily as more teeth and dentitions are saved. An improved quality of life has resulted, but not reduced total costs. On an individual basis this may save money, but the much greater utilization results in massive increases on a national basis. For the nation, the cheapest cost for dental care is to have more dentures -- not root canals, crowns, and implants. No country with private or socialized health care has found lowered total costs through more preventive care. As actuary tables indicate, the greatest percentage of health care costs occurs during the last three years of life. Preventive care delays this cost and adds to it. It does not reduce it.
How are we going to provide the care for these new patients? In most other countries, the waiting lines for doctor visits is greater than here. If we add 40 million people to the office system, how long will we have to wait for an appointment? Will elective procedures be much harder to come by? What will be labeled elective as a result? In Canada, the provinces administer the health care system. In the past, shortages of money have resulted in reduction of many elective procedures until the deficits were eliminated or a new fiscal year commenced. We cannot train enough medical personnel quickly. It takes seven to ten years to educate a physician from medical school through a residency or fellowship. Therefore, more care will be provided by ancillary staff. Fewer patients will see doctors. Nurses are highly educated, but not enough are available presently. Our medical care is excellent due to the high level of training and the high percentage of specialists and subspecialists. While this fragmentation increases costs, we still provide services to the average American that are the envy of the world. The quality of care will diminish over time under these proposals.
For years, some have argued that emergency room care is extremely expensive. Often people with insurance utilize this form of care delivery rather than office appointments. Many attempts to change this have not resulted in changed public behavior. The total cost of all uninsured patient visits to the emergency room is substantially below the proposed costs of these plans. Secretary of Health and Human Services Kathleen Sebelius has stated that in 2006, one-fifth of all visits to emergency rooms were made by uninsured patients. They receive care and follow-up care, but threaten the financial health of our hospitals. Why do insured people continue to use emergency rooms more than necessary? Lifestyle and time pressure issues may be the root of this problem. More urgent care and free-standing walk-in facilities are needed. Those take money.
The issue of medical malpractice reform is rarely mentioned. The Congressional Budget Office estimates reforms could save $10 billion per year -- small numbers, as some argue. However, this would also change the climate under which everyone operates. Certainly, the strong opposition to this reform implies the savings may be much more. Medical errors do occur, but the system of torts damages does not eliminate them. It does enrich liability and torts litigation lawyers, though.
Many will disagree with this analysis. However, what is their qualification to evaluate the situation? Many who claim expert status are accountants, administrators, lawyers, non-practicing physicians, public health nurses, and politicians. What benefits will they receive when the system is changed? Why are so many people pushing for changes to the system, while the majority of citizens want the cost increases limited? Maybe they will benefit from the new system. Maybe they are also incorrect about the proposed results. Shouldn't we improve what needs fixing rather than overhaul the whole system?
If the proposed changes are excellent, why don't the Congressional members select this new plan for themselves? They currently have what is called a "Cadillac" plan. Just as their retirement plan is more beneficial than Social Security, they have a health care plan that provides benefits above those available through any private insurance plan in America, and without a high premium. Some "public servants" we have elected.
What is the rush to complete this legislation? Maybe we can agree on a few points. Only then should we enact any changes before we undo the best-quality health care in the world. No one is denied care in this country. Anyone who enters an emergency room must be given care regardless of his or her ability to pay. Ask any newborn child of an illegal alien. I hope for some reflection by the American citizens. Once we go down this path to government control, we may not be able to return to the ways of the present. There are many good-intentioned individuals trying to fix the system. Our leaders don't understand the damage they may cause. It is time to stop them and open the reform effort to more knowledgeable people.