Obamacare vs. The World

Imagine the president of the United States saying they have a military target in their sights. If the US destroys this target it would save the country hundreds of billion dollars and tens of thousands of lives every single year. The target also appears to be vulnerable, there is little chance it could not be defeated. In fact, in recent decades other countries have defeated the same target with ease and great success. This mission would surely have the backing of the American people and be an immediate go. So what is the target? Is it North Korea? Iran? No, it is the private health insurance industry.

The US is the only rich country in the world without universal healthcare. This privatization of medicine causes the US to have the highest per capita medical costs and inferior outcomes. John Boehner stated in 2012 that America has “the best healthcare in the world.” Many Americans would agree with this statement but reality paints a much darker picture. The United States healthcare system was ranked 38th in 2000 by the World Health Organization. A 2012 report by the National Research Council and the Institute of Medicine ranked US dead last among 17 developed nations. Among these 1st world countries the US had the highest infant mortality rates, the shortest life expectancy, most injuries, most homicides and most disabilities. (So at least we’re #1 at something.) A Harvard study attributed 45,000 annual US deaths to a lack of health insurance. Families USA came to a more conservative estimate of 26,000 deaths from no insurance between the ages of 21-64. At the very least this is equivalent to suffering eight September 11th attacks, except these atrocities are self-inflicted and repeated every year. (3,000 Americans died from the 9/11 attacks so : 26,000/3,000= 8.67)

Let’s look at the economics of the issue. The US spent $8,233 per capita in 2010 according to OECD (Organization of Economic Cooperative Development) and $8,680 per capita on health annually in 2011. (Probably over $9,000 as of today – August 2013) For comparison Canada spent just under $4,500 per person in 2010. Our northern neighbors spend about half as much on healthcare and achieve superior results. The US spends 17.6% of it’s GDP on healthcare and the OECD average is 9.5%. This 8.1% differential in a 15 trillion dollar US economy amounts to over 1.2 trillion dollars. Routine operations frequently cost thousands of dollars more in the US than in other industrialized countries and we have the highest prices for pharmaceuticals. For example a coronary angioplasty average costs is $14,378 in the US and $5,547 is the average in Finland. Hip replacements are $5,000 cheaper on average in Canada and C-sections cost half as much in Germany. ($3,732 vs $7,449)

The health and lifestyle of Americans is similarly in terrible disrepair. The US has 5% of the world’s population and consumes two-thirds (67%) of the world’s anti-depressants. (Zolaft, Prozac) One in ten Americans are on these anti-depressant medications and the number of prescriptions is steadily climbing. The US also ranks at the top of the lists for anxiety disorders with over 40 million Americans being affected. Not surprisingly the lion’s share of the anxiety medication also get’s sold here. Our collective mental health is atrocious and our physical health isn’t much better. The US is always in the running for the world’s fattest country. Almost 70% of the US population is overweight and 30% of the population is obese. Heart disease, diabetes and high-blood pressure are frequent medical ailments costing hundreds of billions of dollars per year. The US has low rates of tobacco usage and yet still manages to have high cancer rates. As mentioned earlier, the US has the highest infant mortality rates, the shortest life expectancy, most injuries, most homicides and most disabilities among developed countries.

Implementing universal healthcare like every other industrialized nation is the obvious solution. It’s a political non-starter however. Bill Clinton chose to prioritize NAFTA over healthcare in 1993. He used up too much political capital getting the free trade bill passed and was unable to pass his healthcare bill. Fifteen years later Barack Obama was elected president and one of his first comments from the white house was that, “the public (healthcare) option is off the table.” Obama was able to get a health bill passed, The Affordable Care Act. The bill, dubbed Obamacare, does have some definite improvements. It will ensure greater coverage for Americans, end some of the insurance companies most exploitative practices and stem the tide of rampant medical inflation. Just as important though, the bill provides hundreds of billions of dollars in subsidies to health industries and leaves the root of the problem, privatized health insurance, intact.

Several studies have been conducted on implementing universal healthcare in America. Virtually all the studies have predicted colossal savings if the US were to adopt such a plan. Physicians for National Health Program have estimated annual savings at $400 billion dollars per year. In another estimate economist Gerald Freidman concluded single-payer healthcare would save $570 billion dollars annually. Among other nations Norway was the second biggest per capita spender in 2010 at $5,388, if the US could match this it would save almost 900 billion dollars per year. ($8,233-5,388= $2,845 per capita savings x 315,000,000 Americans = $896,175,000,000) This would be about 6% of US GDP. In actuality the US spends 17.6% of it’s GDP on healthcare which also the highest in the world. In second place is the Netherlands at 12.0%. If the US could just match this it would save 840 billion dollars per year. (17.6% – 12.0% = 5.6%) (5.6% x 15 trillion dollar US GDP = 840 billion dollars) The potential savings are enormous and are approaching a trillion dollars annually.

In addition to direct medical savings a single-payer system would eliminate the practice of medical bankruptcy. Medical bankruptcy is the number one cause of bankruptcy in the US despite the fact such a concept doesn’t even exist in other advanced countries. 60% of all US bankruptcies are from medical bills, affecting over 2 million Americans each year. Medical bills are attributed to 60% of all bankruptcies in the US and 25% of senior citizens will declare bankruptcy due to medical costs. Other benefits from universal care would be harder to quantify but just as real. Higher life expectancy, lower obesity rates, improved psychological health and improved infant mortality rates would all come along with lower costs. We’d also prevent tens of thousands of people from dying each year because they can’t afford treatment.

Let’s flip the script. Instead of trying to convince America to adopt universal healthcare imagine trying to convince a country with socialized medicine to Americanize their system. Really think about going to Japan and saying, “I understand that your country has a high life expectancy, low obesity rates and spends a little over $3,000 dollars per capita on healthcare. But as an American I see huge room for improvement. For starters you just can’t insure everybody, it makes people lazy and dependent. The poorest and unhealthiest 20,000 or so of your citizens should just be left out to die every year. There’s no profit to be made in treating them and hey we all gotta go sometime right? Even with them gone you’re still insuring too many people, it’d be best if you let about the bottom 1/6th of your population have little or no insurance at all – it’d be efficient and teach them personal responsibility. Also, your medical system has too little bureaucracy and is too easy to understand. Having everything under a single government payer is too streamlined with almost no overhead. You really want to break that up into several private insurance companies that deny as much coverage and claims as possible.” The Japanese would believe you are either joking or a complete psychopath, the system you are preaching for would seem like a sick joke.

For decades now a majority of Americans have wanted a single-payer system. Yet if a politician embraces single payer healthcare they are denounced as a left wing extremists. Obama was lambasted as a socialist for his modest reforms. In other countries this situation is reversed, only the extremists are opposed to single-payer healthcare. The health systems of western Europe are very popular with their citizens and rightfully so, they provide superior service at a lower cost. The US not only lags behind in cost and outcomes but also lags chronologically. South Korea had universal care in 1988. Denmark had it in 1973, Canada 1966 and Norway in 1912.

I can see a path from the Affordable Care Act to a universal single-payer health care system. Its psychological. As a nation, we are committed to making sure that every person receives health care affordably. If that’s the frame, then single payer starts making the most sense. The previous frame was that health care is an individual responsibility and if you didn’t have it then that was your problem. That’s a big difference. And I think that in politics, framing is key. How the population views an issue affects how they vote on it.

The Affordable Care Act is bad, but it’s so much better than what the previous system was. Children were dying because they hit their lifetime caps on insurance coverage before they were six. The Affordable Care Act fixed a lot of stuff but it didn’t go far enough. It’s not what the American people deserve but it’s what we could get.

***{( Their is a difference between the types of systems; here is some of them, along with the advantages/disadvantages and the challenges of adopting those types of systems in the US:

Single-payer insurance (Canada)
In this model healthcare remains provisioned by private parties but the government takes over the role of the insurer. This is the currently proposed alternative system in the US but the proposed version is very different to the Canadian model; In Canada doctors typically do not work for hospitals (they operate on a fee-for-service or time-fee basis as contractors to the Canadian government) and while hospitals are privately operated most of the buildings are provincially owned, neither of these are present in the proposed US model. This system can be free at point of use.
The health outcomes of this type of system are relatively good, although with some capacity issues which cause wait time issues. Short term such a switch would produce a saving of between 4% and 11% over the current system but the savings achieved would likely be reversed by an increase in consumption. This type of system also does nothing to address the wider problem of healthcare delivery.
While the contract based doctor provision is entirely achievable currently the way hospitals operate would not currently be possible, we don’t have the capital or borrowing capacity to purchase a sufficient number of hospitals off their owners and the constitution does not permit us to simply confiscate them without fair compensation.

Centralized Single-payer healthcare (UK)
In this model the central government controls facilities (although not always owns them, the UK has been experimenting with financing new facilities via PPP), personnel and financing with a central tax for healthcare provisioning. All doctors other then PCP’s typically work for the government (PCP’s are fee-for-service or time-fee). The UK is currently the only example of this in the developed world. This system is free at point of use.
Health outcomes of this type of system are average with significant capacity issues. There is no accurate prediction regarding the operating costs of this type of system in the US but it will certainly be smaller then current combined public & private spending and likely significantly so.
The problems with this type of system in the US would be numerous. Firstly centralized systems respond very poorly to regional changes in healthcare needs, this is one of the trade-offs for lower costs, and we would have to accept a lower standard of care (for those who do not currently have accessibility problems) then the current system overall in exchange for universal coverage and the lower costs (this is primarily why the UK system has not been repeated elsewhere). The problem with purchasing facilities is the same as with single-payer insurance.

Regional Single-payer healthcare (All the Nordic countries)
In this model the central government mandates the level of care regional authorities are required to offer and those regional authorities are responsible for raising the revenue and providing the services. As with centralized single-payer the facilities are generally owned by the government and doctors generally work for the government. This system is free at point of use.
Health outcomes of this type of system are good with few capacity issues. As with centralized single-payer it is not possible to accurately predict the operating costs of this type of system but they would also be lower then our current system while higher then centralized single-payer.
The only special problem with this type of system in the US is that its success lays in the relatively small size of its regional health authorities. The equivalent in the US would be the federal government mandating the service and a county taxing for the service and providing it, this would not currently be constitutional. Same facilities issue as the previous systems here.

Basic Single-payer healthcare (Australia)
Functions much the same as the Canadian example with the exceptions it is not always free at point of use (government pays between 75% and 100% of costs), the government does not cover most electives and there are a number of privately owned hospitals that treat public patients on a fee-for-service schedule.

Multi-payer (France, Germany etc)
Multi-payer systems differ from single-payer systems in numerous ways. Firstly healthcare is not supported from general tax revenues, the majority of healthcare is paid for via insurance or withholding specifically targeted at healthcare. Secondly the government generally neither owns nor operates the facilities, the overwhelming majority are privately owned and often operated for a profit (in the case of Germany nearly half the hospitals are operate for-profit compared to 12% in the US). Thirdly its not possible for the government to set a fixed healthcare spending level, single-payer systems establish how much they want to pay for healthcare and then distribute resources accordingly while multi-payer systems establish which services people are permitted to consume & the level of subsidy they will receive and spending is simply however much is consumed at those levels. This type of system is not generally free at point of use.
Health outcomes of this system vary but are generally very good and there are no capacity problems. It would be cheaper (how much depends on the exact form) then our current system while more expensive then the single-payer systems. There would be no particular problem replicating this type of system in the US but the tax and regulatory changes required could be challenging. This type of system would also be far more “free market” then the mess we currently have.

Third-party-payer (USA)
Absolute shit.

Account-payer (Singapore)
In account-payer systems patients pay for the majority of the healthcare out of pocket with a government subsidy applied (in effect if you are poor your heart transplant costs $50 while if you are wealthy it costs $50k), payments are made from savings accounts individuals are required to contribute to. This is not a free at point of use system.
Health outcomes of this type of system are very good and there are no capacity problems. Cost wise this would be the “best”, we would be able to fund a universal healthcare system while reducing current public healthcare spending. This type of system would also be far more “free market” then the mess we currently have.

(Universal and Single-payer are not interchangeable.)}***

So the USA pays approx DOUBLE the OECD average and yet manages not to have Universal Health Care. It’s a hell of an achievement. How can Americans pay for a Rolls Royce and yet take delivery of a Chevy with a puncture?

The USA needs to find the solution every other Western nation has found. Universal Health Care free at the point of delivery.

Why hasn’t it?

This is why. The Medical-Industrial Complex has donated $833,259,267 directly to members of Congress. Not counting the huge amounts of money given to presidential candidates like Obama, McCain and Kerry, the biggest donations have gone to the 3 worst industry shills who have been well-paid to make sure there will never be effective, robust health care reform:

Arlen Specter (R-D- PA- $4,026,933)
Max Baucus (DLC- MT- $2,833,731)
Mitch McConnell (R-KY- $2,758,468)

And when you just go right to Big Insurance, the non-presidential candidates who got the biggest legalized bribes were the 7 senators who have been tasked with the job of killing effective health care reform and keeping Healthcare Insurance alive in the USA

Ben Nelson (DLC-NE- $1,196,799)
Max Baucus (DLC- MT- $1,184,113)
Joe Lieberman (DLC- CT- $1,036,302)
Arlen Specter (R-D- PA- $1,035,530)
Mitch McConnell (R-KY- $929,207)
Chuck Grassley (R-IA- $884,724)

( This is a great resource for checking who’s funding your politician)

Citied Web Sources:

1. Health Care In America
2. The USA pays as much out of the public purse from taxes as the average OECD nation, more than nations like France, Germany, the UK, Sweden, yet unlike the average OECD nation does not have any form of universal coverage
3. World health care Organization rankings by per capita spending
4. World Health care Organization rankings by performance

October 20, 2013 | Categories: Uncategorized | Tags: ACA, Access to care, Affordable Care Act, AMERICA, Big Government, Capitalism, Congress, Death, Government, Health Insurance, Healthcare, Human Rights, Individual Mandate, Obamacare, Poor, Rich, Sickness, Single Payer, Socialism, Taxes, Universal Heath Care | 6 Comments