Assorted claims about our present, but threatened, private-health system bombard us. Scholars at the National Center for Policy Analysis (NCPA) examined several of these common, but usually flimsy, current arguments.
Claim: “By stimulating competition and delivery system changes aimed at providing more effective and efficient care, (proposed Obama) policies could yield higher value and substantial savings for families, businesses, and the public sector.” A rosy description of health reform in a Feb. 19 report by the Commonwealth Fund. The fund is formally charged with the limitless mandate to “do something for the welfare of mankind.”
Truth: The current House bill on health reform fills 1,018 pages and threatens a cost of $1.6 trillion in taxpayer dollars. It would create or expand 33 entitlement programs and set up 53 additional offices, bureaus, commissions, programs and bureaucracies. It would result in huge job losses, based on a model developed by Council of Economic Advisors Chair Christina Romer, and cause 114 million individuals to lose their current health coverage, according to the actuaries at the Lewin Group. The word “shall” appears 1,683 times, representing new duties for bureaucrats and mandates on individuals, employers and states. Hardly something “for the welfare of mankind.”
Claim: Thousands of Americans die every year because they aren’t insured. The Urban Institute blatantly declared that--based on its interpretation of the Institute of Medicine’s methodology and Census Bureau estimates of health insurance coverage--22,000 people in 2006 died “because they were uninsured.” Families USA upped the death figure to 26,260 and called death by being uninsured the third leading cause of fatalities in our country.
Truth: These reports are extrapolated from an estimate made in a 15-year old study, using 37-year-old data and employing questionable methodology, the NCPA pointed out. “Families USA purports to show how many people” die in each state and then tallies up “all this carnage with such pinpoint precision,” when claims are based on a 15-year cascade of studies—each repeating the errors and misinterpreting or mischaracterizing the findings of the previous one and ultimately relying on data that is 37 years old.”
Using data from medical records and telephone interviews, Rand Health found that of those surveyed “there was only moderate variation in quality of care scores among sociodemographic subgroups” whether on gender, age or income. And once people see a health-care provider, the study suggested that “insurance status has little effect on receipt of recommended care,” NCPA said. No one really knows “how much morbidity and mortality is attributable to lack of health insurance,” the Center added.
Claim: Other health care systems top ours, even though we spend more money on health care than any other nation.
Truth: Our per capita health-care spending was greater than the median for Organization for Economic Cooperation and Development (OECD) countries, “based on purchasing power parity,” the Center explained. But “normal market forces have been so suppressed throughout the developed world that purchasers (and others) rarely see a real price for any medical service.” So, adding all transactions gives aggregate numbers “in which one can have little confidence.” Also, other countries “disguise costs,” especially health-care provider incomes, NCPA added.
The U.S. compares favorably “when real resources are measured rather than monetary accounts.” And, surprise: The average annual rate of growth of real per capita U.S. health spending actually was slightly below OECD average over the last decade (3.7% vs. 3.8%) and even over the past four decades (4.4% vs. 4.5%), based on findings by the National Bureau of Economic Research.
“Despite common perceptions,” NCPA said, “a country’s financing method—public vs. private financing, general revenue vs. payroll taxes, third-party vs. out-of-pocket spending—is unrelated to its ability to control spending on health care. There “has been no consistent and systematic relationship between financing and cost containment,” according to a National Bureau of Economic Research working paper of March 2008.
Claim: No one is ever denied care because of an inability to pay in countries with universal coverage--such coverage as President Obama so desperately wants enacted. The American College of Physicians (ACP), which advocates affordable health insurance coverage for all, contrasting our system with that of other countries. “Some countries achieve universal coverage with a system funded solely by government,” it flatly contended.
Truth: But at what human cost? Long waits are typical for patients in Europe and Canada, according to NCPA, and “waiting for care has economic costs in terms of sick pay and lost productivity, as well as negative health consequences.” Norway, NCPA said “is trying to reduce waiting times to reduce the cost of sickness benefits. Finland calculates that the cost of waiting (sickness benefits, medicines, and social welfare expenses) can exceed the cost of treatment. Cancer survival rates for all types of cancer are higher in the U.S. than in Europe. The rate for treating kidney failure is five times higher in the U.S. for patients age 45 to 84 and nine times higher for patients 85 and older.
In some countries with “universal” health care, the care is not universal. For example, Britain denies mammograms after age 70, dialysis after age 50, and Pap smears are done only after age 25.
Claim: Medical bills are so expensive they are bankrupting Americans.
Truth: A study conducted by the Institute for Global Health at University of California, San Francisco, compared the cost and performance of the National Health Service in Great Britain with those of an integrated system for financing and delivery of health services, namely Kaiser Permanente in California.
The adjusted costs of the two systems ( both in operation for about 45 years) and their performances with respect to inputs, use, access to services, special activities, and population characteristics were similar, NCPA reported. The belief that the NHS is efficient and that poor performance in certain areas is largely explained by under investment are not supported by this analysis. Kaiser achieved better performance at roughly the same cost as the NHS. Kaiser Permanente is one of the largest integrated health-care systems in the nation. Not all Americans may get similar care. But Kaiser does have 8 million members, who get more convenient and comprehensive care and more rapid access to specialists at roughly the same cost as the Brits.
Claim: Other countries don’t have our high administrative costs. The congressional Research Service has estimated administrative cost for Medicare at only 2% of total program costs. This is compared with 10% for private insurance and 12 % for HMOs. Some advocate a single-payer system (the Obama road) is a strong argument for a universal Medicare program.
Truth: The fallacy of this often repeated tale is that these estimates completely ignore hidden costs shifted to the providers of care, and the huge social costs of collecting the taxes to fund Medicare. For every administrative dollar spent by the private insurance industry, the government spends $1.66. That’s the conclusion of the Council for Affordable Health Insurance.
“The Council has found that government masks the true cost of financing health services to senior citizens on Medicare and to poor Americans on Medicaid. The expenses are hidden under the complex and bureaucratic reporting and tracking systems used by government....In addition, the cost of programs and activities benefiting Medicare and Medicaid exist in a number of other federal budget categories, including Education and Training, Labor, and The National Institutes of Health.”
Eventually, we can hope, the truth will out.