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The killing prices

I don’t often recommend stories that appear in Time. But Steven Brill’s exposé of the healthcare industry in the United States is worth a careful read.

Brill sets out to answer what should be the first question of healthcare reform in the United States: why exactly are the bills so high?

What are the reasons, good or bad, that cancer means a half-million- or million-dollar tab? Why should a trip to the emergency room for chest pains that turn out to be indigestion bring a bill that can exceed the cost of a semester of college? What makes a single dose of even the most wonderful wonder drug cost thousands of dollars? Why does simple lab work done during a few days in a hospital cost more than a car? And what is so different about the medical ecosystem that causes technology advances to drive bills up instead of down?

What he finds is a “a uniquely American gold rush” on the part of corporations—both profit and nominally non-profit, from drugs through hospitals to billing services—that provide healthcare commodities that, in the end, leads to much higher prices than in other countries for results that are much less than in those countries.

According to one of a series of exhaustive studies done by the McKinsey & Co. consulting firm, we spend more on health care than the next 10 biggest spenders combined: Japan, Germany, France, China, the U.K., Italy, Canada, Brazil, Spain and Australia. We may be shocked at the $60 billion price tag for cleaning up after Hurricane Sandy. We spent almost that much last week on health care. We spend more every year on artificial knees and hips than what Hollywood collects at the box office. We spend two or three times that much on durable medical devices like canes and wheelchairs, in part because a heavily lobbied Congress forces Medicare to pay 25% to 75% more for this equipment than it would cost at Walmart.

Brill’s conclusion is that Obamacare only works around the edges of the core problem.

Put simply, with Obamacare we’ve changed the rules related to who pays for what, but we haven’t done much to change the prices we pay.

When you follow the money, you see the choices we’ve made, knowingly or unknowingly.

Over the past few decades, we’ve enriched the labs, drug companies, medical device makers, hospital administrators and purveyors of CT scans, MRIs, canes and wheelchairs. Meanwhile, we’ve squeezed the doctors who don’t own their own clinics, don’t work as drug or device consultants or don’t otherwise game a system that is so gameable. And of course, we’ve squeezed everyone outside the system who gets stuck with the bills.

We’ve created a secure, prosperous island in an economy that is suffering under the weight of the riches those on the island extract.

And we’ve allowed those on the island and their lobbyists and allies to control the debate, diverting us from what Gerard Anderson, a health care economist at the Johns Hopkins Bloomberg School of Public Health, says is the obvious and only issue: “All the prices are too damn high.”

U.S. workers are being forced to pay for increasingly high health insurance premia and healthcare prices out of their stagnant wages, while U.S. corporations are resisting paying any more out of their gross profits to purchase health insurance for their workers. Something has to give, which means going beyond Obamacare to finally create a decent, affordable healthcare system in the United States—a system in which doctors and nurses can actually do their jobs and the broad masses of people have a say in how their healthcare is provided.

Good questions

Bill Keller, in writing about the proposed religious exemptions to the Affordable Care Act, poses a series of good questions:

You might ask why a clerk at Notre Dame or an orderly at a Catholic hospital should be denied the same birth control coverage provided to employees of secular institutions. You might ask why institutions that insist they are like everyone else when it comes to applying for federal grants get away with being special when it comes to federal health law.

Here’s how I put it in a discussion with my coworkers last May:

since when does the existence of “institutions that employ and serve others of different or no faith” require only that such institutions be allowed to carry out their religious mission and not their other responsibilities, such as employer (including employer of women), healthcare insurer, and so on? Such institutions already get significant tax breaks in order to carry out their religious mission, in exchange for fulfilling their many other responsibilities.

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Freedom of choice

Slavoj Žižek puts a positive spin on Obama’s reelection:

Many disappointed by his presidency held against him precisely the fact that the core of his much-publicised “hope” proved to be that the system can survive with modest changes.

So should we write Obama off? Is he nothing more than Bush with a human face? There are signs which point beyond this pessimistic vision. Although his healthcare reforms were mired in so many compromises they amounted to almost nothing, the debate triggered was of huge importance. A great art of politics is to insist on a particular demand that, while thoroughly realist, feasible and legitimate, disturbs the core of the hegemonic ideology. The healthcare reforms were a step in this direction – how else to explain the panic and fury they triggered in the Republican camp? They touched a nerve at the core of America’s ideological edifice: freedom of choice.

Obama’s healthcare reforms effectively deliver a large part of the population from the dubious “freedom” to worry about who will cover their illnesses. Being able to take basic healthcare for granted, to count on it like one counts on water or electricity without worrying about choosing the supplier, means people simply gain more time and energy to dedicate their lives to other things.

On that, Žižek is right: the terms of the debate effectively disrupted the idea that a large portion of the American population would have the freedom to choose to try to get by without healthcare coverage.

The problem is, for many Americans, the individual mandate is the one part of Obamacare they oppose. And for good reason: for many people, it means subsidizing employers (who are increasingly resisting pay for health insurance for their employees out of their gross profits) by forcing more individuals to pay their health insurance premiums out of their own wages and salaries. In other words, they’re being squeezed, twice over: first at work, and then when they try to make do based on their stagnant incomes.

Of course, the only way of expanding healthcare coverage while keeping private insurance and private healthcare delivery is to impose such an individual mandate. What this means that the next stage of healthcare reform in the United States is to move beyond that private system and create a single, universal provider of healthcare coverage and delivery.

Cartoon of the day

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Cartoon of the day

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