Democracy Under Assault
Theopolitics, Incivility and Violence on the Right

Michele Swenson

Failure of U.S. profit-centered health insurance

Spending almost twice as much, the U.S. has worse health outcomes than other industrialized nations. Uniquely, U.S. health care is dependent on over 1200 for-profit health insurances, functioning as gatekeepers. Underwriting 末 the art of risk evaluation and avoidance 末 insures profits by covering the healthy and rejecting everyone else as a "pre-existing condition."

Profit is a perverse incentive for quality health care: imagine for-profit fire or police protection. "Market-driven" health care treats health as a commodity, to be negotiated like a car or a house. The free market has also spawned "designer hospitals," offering only the most profitable specialties, e.g., cardiac procedures, and eliminating less profitable services, e.g., emergency and mental health.

Failure of private health insurance is characterized principally by decreasing benefits and greater costs and risks shifted to consumers. In turn, more are subjected to underinsurance and unpaid medical bills 末 now the leading cause of personal bankruptcies. Premium increases of 87 percent over 6 years have outpaced both cost-of-living and median family income increases.

Incremental reform proposals demonstrate lack of political will 末 the same failure to confront corporate profit-taking by insurance and pharmaceutical industries that wrote Medicare prescription drug reform with billions of dollars of taxpayer subsidies and inflated profits to benefit their bottom lines.

Commercial health insurance is the 800-pound gorilla, responsible for over 25% of health care dollars siphoned to excessive administrative costs, lobbying, marketing, CEO salaries and profit-taking: $30 billion annual health insurance profits and $32 billion insurance underwriting and marketing costs (McKinsey Group, 2007).

Gaming the system for profit has given rise to the annual $20 billion business of "denial managment" 末 health insurance middlemen who search claims for excuses to delay, deny or renege on reimbursements.

Responding to double-digit premium increases, more employers are opting to move employees into underinsurance 末 high-deductible catastrophic plans. Simultaneously, the American Hospital Association reports that both family out-of-pocket health expenses and unpaid medical bills have risen approximately 60% over a decade 末 still more costs ultimately shifted to taxpayers and consumers.

Notably, more than 20 federal and state studies since 1990, including the 2007 Lewin Group evaluation in Colorado, have demonstrated that single-payer health insurance is the only reform model that can both save money and provide comprehensive health care benefits for all.

Contrary to assertions by the "free market" choir, only single payer insurance permits unlimited choice of pubic and private providers; private insurance limits choice to "in plan" doctors. Only single payer provides comprehensive benefits and protection against medical bankruptcy. It is the only equitable, sustainable health financing system.

Most current health reform proposals revert to a Massachusetts-style nostrum, preserving insurance profits and requiring an individual mandate to purchase minimum-benefit insurance, subsidized by taxpayers as needed. It is a formula for continued inflationary consumer health costs and decreasing benefits.

National single payer bill, HR676, calls for a progressive 3 to 4 percent employer and employee payroll tax to replace all health deductibles and premiums. Full-coverage costs for a family of four earning $40,000 annually would drop to $110 a month, from recent levels of $273/month for employer-sponsored coverage, or $489/month for an individually-insured family (Kaiser Family Foundation, 2007).

An insulated political class in Washington, dependent on corporate money and privy to 70 percent-taxpayer-subsidized health coverage, sidesteps meaningful reform. Nevertheless, polls by Pew and others have revealed increasing numbers in the U.S. 末 54 to 65 percent 末 support a national single-payer health care plan. A recent study reported that 59 percent of U.S. physicians "support government legislation to establish national health insurance," an increase of 10 percent since 2002 (Annals of Internal Medicine, 3/31/08).

We have everything to gain from quality-, saftey-centered universal single payer health care to replace U.S. dependence on profiteering health care gatekeepers.