Given the disarray in the individual insurance market, the latest survey from the Center for Health System Change (here’s the News Release and here’s the longer issue brief) proves that economics is alive and well. There is such a thing as an income effect and a price effect–so if business income/revenue goes down and the price of insurance goes up, well funnily enough a lot less people are going to be getting health insurance from their employers. And somewhere mixed in that is the little nugget that if you don’t have a job any more, as we used to say in England, you have two chances of having an employer provide you with health insurance: No chance and (As this is a family blog. I’ll censor the rest of this remark).girlie-men or no girlie-men, and the other is more people on both sides of the patient-provider relationship discovering how inadequate Medicaid is. Furthermore most of the increase was for children rather than adults, so there was some relative shift in who within families got insurance, but even so public sector insurance rolls expanded for adults too.The Blogging of the President which explains (to my satisfaction at least) where this all will drift to: The reason that eventually we’ll get to some kind of compulsory national health care system is grounded in the fact that for the last hundred years if you (or your employer, or the government if like the elderly you had some power and could force the burden onto other taxpayers ) could not afford insurance, you went without. That meant that the medical system could keep charging as much as it liked because those who couldn’t afford it would be dumped into the safety valve known as uninsurance. In such a system two things eventually will happen.

The number of those with employer-provided insurance fell from 67% in 2001 to 63% in 2003. That fast a fall in that short a space of time is pretty significant, and of course starts to throw many more people into the individual insurance market and/or into uninsurance, which are pretty closely related if you’re sick anyway. This also confirms why health insurance is becoming a bigger and bigger deal on the campaign trail as more people are now more aware that growth in health insurance premiums actually costs them something directly (rather than depresses their incomes indirectly as it has for decades now).

The other thing that has been going on is another expansion of Medicaid, which almost mirrors the huge expansion of Medicaid during the early 1990s recession. The number of people getting insurance from public sources went up by 3%. However, that in turn means two things. One is massive pressure on state budgets,

But the big overall message is that we are moving whether we like it or not into a system where the combination of government programs (including Medicare of course) and individual insurance will eventually overtake the employer-based group insurance that has been the mainstay of the US health insurance "system" (and I use that word very loosely). How fast that transition happens depends somewhat on politics, but eventually those with good health benefits at work will be in the minority.

All of this will increase the eventual pressure that we’ll face as a nation to get to grips with this. In fact I’m going to repeat a para here that I wrote in the comments over at

First, costs which have been allowed to grow without any controls will eventually become too great for those paying the bills (esp. large employers). They will continue to push people out into un or under-insurance, which is exactly what the HSC study is finding.

Second, the number of un or under-insured will become so great and politically powerful, that it will end up creating a compulsory "national insurance" system. That system will shift the burden from employers to the taxpayer, which will coincidentally make the employers happy (and most people too, if international surveys are to be believed..)

And once everyone’s in the system and there’s a direct correlation between taxes and health spending, healthcare spending will come under much tighter control. After all we’re Americans and we hate taxes (so long as levied by government rather than the health care system which calls them premiums).

This happened in the rest of the world between 1945 and 1970. It nearly happened in America in 1993, and it will happen sometime in the next 20-40 years here. This isn’t an ideological argument, it just has to play out that way unless health care costs go downwards over that time, and I hasten to guess that not even Mark (Note: Mark was a previous poster in this thread who hated Canadians and poor people) thinks that will happen.

The Industry Veteran is back and on fine form, picking up the ball on a piece of crossed out editorial about my least favorite American politician, and running it into the realms of whether the Democrats are right (as Jones the Policy Wonk suspects) to take the milquetoast route, and whether marketing to doctors needs to be different than to other clinicians.

"Theocratic fascist?" I love it. Now those are the terms and the tone I expect to see on a blog. If I wanted neuterizing, backpedalling, vague ambiguity and maudlin sentiment ("hope," "we can do better," "a government as good as its people") I’d watch the Democratic convention.

This leads directly to my opening rant. The Democrats apparently believe that aggressive Bush bashing will repel the "persuadable" 20% of the electorate and, for that reason, most of their carefully orchiectomized speeches have been as energizing as 20mg of Valium. Two reasons make me think they’re making a bad mistake.

Let me start by recalling two, well established facts of voting behavior in this country: (1) voting participation varies directly with socio-economic status and; (2) only half of eligible voters go to the polls. This means that non-voting prevails among the lower two-thirds of the economic ladder that constitutes the Democrats’ social base. Election victories by Democrats, therefore, owe more to mobilizing voting among this base than to persuading the half-assed/undecideds. Democratic non-voters need a reason or reasons to vote. Platitudes about a shining city on a hill, restoring opportunity to America or giving us security with peace don’t cut it. A candidate who lacks personal magnetism, together with the lachrymose sentimentality that Democrats have been shoveling out all week, produce responses ranging from indifference to cynicism and distrust, none of which provides lapsed Democrats with an incentive to vote.

My second argument for sharper, more abusive language contradicts the pollsters’ assertion that negative campaigning and personal attacks merely turn off voters. Pharmaceutical research that I have conducted over many years with physicians and consumers leads me to suspect that the Democrats are receiving some bad advice. When asked how they feel about ads and other promotions that slam a competitor’s product, physicians and consumers typically give the socially correct response by saying that they disdain it. Further probing beneath this response indicates a different, more complicated process at work. Both physicians and laymen disparage negative or critical promotions that lack specificity because the course of action suggested by such communication (i.e., buy our product rather than the competitor’s) does not follow logically. As a result, test audiences believe that promotions full of "empty abuse" insult their intelligence. Physicians, for example, want to see the results of published studies, together with tables, charts and a condensed version of the supporting data. Consumers seek their own forms of corroborating evidence, and this varies according to the product, the market segment and several other factors. Given a rationale that effectively informs their selection process, physicians and consumers actually welcome a sharply stated conclusion: the other guy’s product is less effective and more poorly tolerated than ours. In short, go ahead and call John Ashcroft a theocratic fascist after first discussing the draconian features of the Patriot Act. Call George Bush an arrogant dope, a plutocrat and a lying scumbag after first discussing, well, any of his policies. Hey, if a longtime Republican operative such as David Gergen thinks the Democrats wasted a big opportunity by going soft on Bush, I think he may know something.

Second rant. I mentioned in a previous posting that I completed a study earlier this year involving the policies and practices of Big Pharma companies relative to the OIG/PhRMA guidelines for promoting to healthcare professionals. (OIG is the Office of the Inspector General at the Department of Health and Human Services; PhRMA is the Pharmaceutical Research and Manufacturers Association, Big Pharma’s trade lobby.) In response to exposes over the past few years that featured "dine-n-dash" and paid vacations in Aruba, these two organizations each issued guidelines to specify acceptable and prohibited practices for pharmaceutical companies promoting their products to physicians and other professionals. We first assessed the policies and monitoring processes used by the largest pharmaceutical companies for assuring compliance with these guidelines. Then we analyzed their actual promotional practices out in the field. Suffice it to say that while the overall level of bribery and bribery-in-kind has diminished slightly or has become less overt, the levels of compliance vary among the companies and nearly all reflect major disparities between policy and practice.

More recently a client asked us to make a similar assessment among diagnostic device companies. We found that while compliance differences also exist among these competitors, such differences are smaller than among the pharma companies and, more importantly, the general level of bribery and bribery-in-kind is also far lower. This reduced level of baksheesh became evident early in the study, so we spent a good deal of time and effort trying to account for it. While any complex social behavior usually results from multiple factors, there is a principal reason why fewer payoffs, involving lesser amounts, occur in the diagnostics business. Stripped to its essentials, the promotion of diagnostics involves a far smaller number and proportion of office-based physicians who would demand such gratuities. Very often the decision-makers who select/recommend diagnostic products are clinical chemists, diabetes nurse educators, microbiologists and other non-physicians. Some decision-makers are purchasing agents for hospital and other buying groups. Their product selections must provide strict cost justifications that leave little room for the subjective preferences subject to gratuities. Once again, our princes with stethoscopes, these Mafiosi doctori and purveyors of the Hippocratic myth, have dipped their beaks into the underground economy of healthcare to raise the costs and lower the ethical standards.