American Healthcare: Caught in a Bad Romance

By

“I want your Ugly.  I want your Disease
I want your Everything, as long as it’s Free.”

—America’s leading contemporary philosopher, Stefani Germanotta (aka Lady Gaga)

Insight comes from unlikely sources. Lady Gaga nailed the health reform dilemma. We have a healthcare delivery system that is an orgy of profligacy and excess that offers the false promise of making ugliness, disease and death all optional. And, we the public love all of it, as long as it’s free, at least to us as individuals. We want high tech, high quality, high expectations met, highly trained professionals delivering high standards, paid by someone else. And the magic fairy that will pay for all of this? Health insurance. Give everyone an insurance card and they can have their everything and it will be free, or close to it.

But wait, isn’t the cost of insurance tied to the costs of care? Doesn’t the sum of all healthcare costs for a covered population (plus administrative costs) divided by the number of people equal the premium. Doesn’t the premium come out of my pocket as taxpayer, employee or individual? How can I have everything, as long as it’s free?

Short answer is: you can’t.

We are caught in a Bad Romance with healthcare.

The brutal truth is that the average American household cannot afford the average costs of care. With household income stagnant to declining at $50,000 a year and typical total healthcare costs at $15,000 per household, average people cannot afford the average costs of care. Even if we were to fully accept the notion that rich people have to subsidize poor people (which still seems a bit of a stretch to some on the right) you would think that in a wealthy county like America, the average household could afford the average cost of care. But as the healthcare debate showed both in Massachusetts and at the national level, nearly all of us need a subsidy to make health insurance affordable. (Say what?)

How can “affordable care” mean we need to subsidize nearly everyone?

Well, that’s a problem. There are really not enough rich people to go and tax. And those rich people are not having a good year. The revolting people of Massachusetts were independent voters who are paying their taxes and mortgages and mandatory health insurance premiums and who when asked to step up and pay taxes for a healthcare bill that wouldn’t help them any, said no to big government. (By the way, they also said yes to a telegenic, former nude centerfold who outhustled the dullest politician in America by a factor of 10 to 1). And they baulked at being asked to pay federal taxes to subsidize the mean-spirited people of Texas and Alabama who really don’t want to be forced by the federal government to cover poor people through Medicaid expansion or insurance exchanges or worse yet a public option.

Health reform may be dead. Sensible centrists like my friend and fellow futurist Jeff Goldsmith, the always sane and insightful Bob Laszewski, and my physician policy wonk pal Bob Wachter have all written eloquently on this blog about the possible political path forward. I will not repeat their points with which I nearly always violently agree.

Nor do I particularly want to unleash a flurry of rehashed mini-essays from all of you regular contributors about how health refom should or shouldn’t go from here. I know that each of you believe that your idea is the right one. I get that. And I am in reverential awe of the time you pour into these pages.

We should all be very grateful to Matthew Holt for creating this blog.  His vision has created a meeting place for all of you out there who care deeply about healthcare and about politics and policy of healthcare. (I should say by way of full disclosure that I had the pleasure of working with Matthew for many years, hired him from Stanford to join the Institute for the Future, and played some modest mentoring role in his professional development.  Matthew was also the inspiration of IFTF’s then dress code: “no shirt, no shoes, no salary”.)

So my plea to all you healthcare bloggers of America is this: Please turn your attention to the central problem. How can American healthcare delivery be better, faster, and cheaper in the future not more expensive and worse. And please no ideas about giving people insurance cards subsidized by someone else (especially not the Chinese or my children) as in the current proposals.

This community must have some good ideas about how to get us out of this mess. We are caught in a Bad Romance.

Ian Morrison is an author, consultant and futurist based in Menlo Park, Calif. He was indeed Matthew Holt’s boss at IFTF until Matthew quit the restrictive dress code and exchanged it for the blogger’s PJs.

Livongo’s Post Ad Banner 728*90

Categories: Uncategorized

Tagged as: , , ,

43
Leave a Reply

43 Comment threads
0 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
16 Comment authors
EuropeanAlex JansonA.B.acekard dsSalt Lake City Recent comment authors
newest oldest most voted
European
Guest
European

I live in Germany. Our healthcare is sooo different from yours.I am 62 years and never had any problems with our healthcare. I pay my monthly health insurance can go to every doctor I want to. If we have to visit a doctor we pay 10 Euro for 3 month to him thats new and many people are angry about this. I have to kids, born in a hospital. We never get any bills from a hospital this is all covered by our insurance. My husband had, when he was young , a motorbike accident, he broke his leg several… Read more »

Alex Janson
Guest
Alex Janson

I have lived in seven countries and as I see the USA was the last country where there was more freedom than anywhere else. This is coming to an end. First the right-wing used 9-11 as an excuse to decrease freedom, and now the left-wing led by Obama wants to take away any remaining advantage in the USA. The left-wing always wants to increase government intervention and the only business is healthcare where there was until lately more freedom in the USA than elsewhere. A great recession is coming in the next years caused by the “baby-boom demographic wave” and… Read more »

A.B.
Guest
A.B.

The problem is the industry. Lobbyists. The money is rolling behind your backs. I am from Europe, and guess what? I never payed a cent for healthcare. I can go and see a doctor whenever i need one. And it costs me nothing. Just yesterday i saw that film from Michael Moore about the American healt care sytem and i am truly shocked. I am glad to have been born in Europe. And i am glad it is as social as it is. Americans should stand up for their rights, they should go and demonstrate, strike…whatever. Its you people that… Read more »

acekard ds
Guest

Great article. I think it resonates in anything…people, at least myself, are more willing to work with people who have a desire to learn, Spanish health system is dual, we have good private hospitals, some of the best in Europe in terms of investigation and treatmens, but the best of the spanish system is that the public system is even better than the private. The only problem you can find is that sometimes you have to wait some weeks for an operation, but no one dies on the street, enfront of a hospital, because of not having money enough to… Read more »

Salt Lake City
Guest

Really to increased the number of cases, and we must see that type of incident will improve the way of helping the people, for it in findrxonline will find the solutions and other ways of offsetting it.

Peter
Guest
Peter

“Blues in MA had the clout and instead of using it to pressure partners to lower cost they conspired with them to raise it. We see the same thing in Medicare, providers and the goivernment allow mutual growth at the expense of the public. The large carriers don’t have lower cost they have monopolies to drive business. It is a lack ofcompetition that allows rates to grow out of control.” Nate, I can’t agree with you move on this but on the one side you recognize the power of clout (Blues) but then say we need 100’s of carriers, each… Read more »

Nate
Guest
Nate

“You know, I think there is something in the middle, between free Medicare and 100 private plans.” I’ll bet you weren’t thinking 50 plans where you? “The VAT money is dedicated. The Feds cannot divert it or anything like that.” Medicare 1965 by law must reimburse providers a fair amount, The feds can’t pay less….until they did. I’ll just remind you how Social Security and that huge tax windfall worked out for the public. Government can not be trusted with our money period. Any VAT would be funding other programs or obligations before the ink dried. Every month I also… Read more »

Barry Carol
Guest
Barry Carol

Margalit – While I like a lot of what Dr. Emanuel said in his book “Healthcare Guaranteed,” I thought the weakest part of his thesis relates to the VAT and how much money it could raise. Due to exemptions for necessities, the broadest based VAT’s in Europe raise about 0.4% of GDP for each 1.0 percentage point of tax. On that basis, to replace funding for Medicare and Medicaid, which currently costs about 5.5% of GDP combined plus cover the uninsured (excluding illegal immigrants) which would probably add another 1% of GDP or a bit less, we would need a… Read more »

Margalit Gur-Arie
Guest
Margalit Gur-Arie

You know, I think there is something in the middle, between free Medicare and 100 private plans. The vouchers that Dr. Emanuel proposed and the progressively structured VAT to pay for them. That way, seniors continue to pay their share until the end. There is no mammoth government plan to administer. Government would only be involved in collecting VAT and paying for the risk adjusted vouchers to the private guys. No more Medicaid either (the states should be happy). Of course, there will be regulation of what insurers have to provide for the vouchers, but as far as supplementals go,… Read more »

Nate
Guest
Nate

“how do you propose to deny seniors their advocate and lobbyist?” I wouldn’t seniors are free to give money to whom ever they wish, but they shouldn’t be getting any of my tax dollars and they should stop being viewed as the voice of seniors when they gave that up 10-20 years ago. They should be taxed like any other business, as that is what they are. “How will 100+ different plans have the power of the dollar to lower costs,” Innovation. The same way 100 MA HMOs beat Medicare. the same way my little company can out perform Anthem… Read more »

Peter
Guest
Peter

“AARP needs to go down. They don’t serve the needs of seniors they’re nothing but government sponsored pimps.” I’m no fan of AARP and gave them back their membership after they supported Med PartD, but how do you propose to deny seniors their advocate and lobbyist? Certainly you don’t want the government doing this. “1. Break Medicare into 100+ different plans. There needs to be competition for service and management. How do to this while not corrupting it I am not sure.” How will 100+ different plans have the power of the dollar to lower costs, if Medicare ever gets… Read more »

Heidi Hawkins
Guest

rbar, before we ruffle the feathers of CMSA (Case Management Society of America) I’ll come to the defense of Case Managers and Discharge Planners. I’m in favor of RN Case Managers and Discharge Planners in direct patient care settings, they really do play a vital role in coordinating patient care. The backbone of a nurse’s skill set is in assessing, planning, implementation and evaluation . . . and in a supported environment these positions use those skill sets effectively. Nurses get frustrated (and are leaving the profession in droves) when the business model of any healthcare entity gets in the… Read more »

rbar
Guest
rbar

Ian and Heidi, I have written this before, but I was asthonished to see how many people worked in non patient care medical services in the US. In the US, you have tons of those people running around (case managers, discharge planners), sitting behind desks (credentialing, billing) or telephones (insurance call centers), it’s only a fraction of this in other countries (remember Michael Moore’s sicko – yes, he is simplistic and at times falsifying – going to that Canadian hospital’s billing department?). I know these are OK jobs, but are they really doing something worthwhile? Couldn’t these folks use their… Read more »

Heidi Hawkins
Guest

You’re right, Ian, but the BLS figures don’t even begin to tell the story. The BLS figures count “healthcare workers” who are employed by systems providing direct care. It DOES NOT factor people who make their living in the healthcare sector. For example, it doesn’t include the Pharmaceutical and Medical Device industries. There are currently between 90,000-100,000 pharmaceutical reps calling on slightly under 800,000 prescribers. The pharmaceutical industry estimates that roughly 1/3 of industry employees are in marketing. That does NOT include R&D employees. The Medical Device, BioPharm, and DME industries are similar. Then we have all those employed in… Read more »

Ian Morrison
Guest
Ian Morrison

Nate Actual BLS employment data in healthcare are at: http://www.bls.gov/oco/cg/cgs035.htm#related See Table 2. I think they confirm the general point that US has a lot of people in administrative roles. Using another measure from the OECD (cost of insurance and administration) US spends 7.2% of total costs compared to OECD average of 3.4%. This underestimates the provider costs of pluralistic payment systems. We have the most bureaucratic healthcare system in the world (both public and private) with lots of people in offices, lots of people selling things to each other in healthcare, lots of consultants, managers and so forth compared… Read more »