Why "consumers" can't drive down health care costs

Bloomberg has a great article up about how impossible it is to find out how much medical procedures cost. Mimi Ferraro spent hours trying to find the least-cost provider for an injection of cancer medication she needed. She made her decision based on information that came after numerous calls - to the insurance company, which told her it couldn't give an estimate on the cost until after she'd had the procedure (!) and then a week of waiting on the answer from her oncologist's office. It was wildly inaccurate. She paid $4,099.51 for a shot she was told would be about half that much. She could have gotten it for half that much at a local pharmacy - but it wouldn't have counted toward her deductible. Her high deductible, that is.

This kind of [high deductible] insurance is expected to help reduce health costs. Given a need to make higher upfront payments, patients may be more selective about the services they buy and keep spending low. But there is a significant flaw in this reasoning: Patients aren’t the ones who make the decisions about which tests and procedures to purchase. Doctors are. And doctors, along with hospitals and insurance companies, don’t let on how much the services cost.

Another significant flaw is that a plethora of studies have shown that people do not make good decisions about health care spending. They balk at spending for preventative measures and, when panicked, will spend far too much when it's too late. Not that they know how much they're spending.

Ferraro pulled together some studies that show no one knows what procedures will cost. She thinks that if every patient demands the cost information that she was asking for, costs will actually become transparent. I absolutely disagree. It's not in anyone but the patient's interest to make that transparent, and our for-profit system isn't set up to benefit the patient. Excuse me. I meant the consumer. I would also point out that not only are U.S. health care consumers blindfolded, this kind of treatment is emotional torture and very bad for your health.

But most Americans can tut-tut. It happens to someone else. We look for what they did wrong - like get sick, for instance - and feel reassured that it won't happen to us.

Who needs foreign-born terrorists to wreck our communities when we've got insurance companies!

Think again if you think being insured = security

Americans love to believe things that are demonstrably untrue - tax cuts equaling increased government revenue and a stronger economy, for starters. Oh, and the whole idea of for-profit insurance companies being an efficient way to finance our health care being another.

So I'm just passing this along - it's not going to make a whit of difference in the debate. The University of Arizona has found that being insured doesn't affect whether you have medical debt.

According to a study published online June 16 by the American Journal of Public Health, after taking age, income and health status into account, simply being insured does not lower the odds of accruing debt related to medical care or medications....

"On average, insurance coverage in Arizona is not protecting families from experiencing medical debt. From other studies we knew that paying medical bills is a problem for a substantial portion of both insured and uninsured Americans. This study helped clarify that the fact of medical debt is an additional and larger barrier to getting needed health care than whether a person is insured or not."

That's according to University of Arizona College of Pharmacy research scientist Patricia M. Herman.

But don't expect the Americans who are swayed by the big-business money that preaches anti-government ideology to take note. (Hell, the mainstream media didn't even take note.)

They're busy admiring Michele Bachmann's poll numbers in Florida, leaving the fact that she's a delusional liar to, at best, the papers' online blogs, to be read by the choir.

Social darwinist Bachmann is quite concerned about a mythical $105 billion "hidden" mandatory spending in the health care reform bill passed last year. That would be the most-debated bill ever passed. Right, Michele.

And the shot heard round the world was fired in New Hampshire. Uh huh. Obviously memory fails us all now and then. But when a third or so of Americans begin to channel the single-minded Walter Sobchak (You're goddamn right I'm living in the fucking past!") from The Big Lebowski, it's hard to know where to begin. As The Dude says, "Walter, I love you, but sooner or later, you're going to have to face the fact you're a goddamn moron."

The scary thing is that these folks aren't just channeling film rage, they and their leaders are unwittingly channeling mass murderers. Bachmann again: “But what I want them to know is just like John Wayne, who is from Waterloo, Iowa – that’s the kind of spirit that I have too.”

As one L.A. Times commenter wrote, "I don't think she was mistaken, she was just speaking in secret code to her minions. She well intends to rape the nation like [John Wayne] Gacy [who was from Waterloo] did to his victims..."

Another commenter offered a SOP right-wing solution: "Let's go to John Wayne's Wikipedia page and change it so that she is right."

How many are underinsured?

Commonwealth Fund has just released a stunning report on underinsurance in the United States. "Insured But Poorly Protected: Number Up 60 Percent in 4 Years", finds that, "Rate of Underinsured Triples for Middle and Higher Income Families; Underinsured Go Without Needed Care and Face Medical Debt."

It's great to have these figures - even though they understate the problem. The report found that there are 25.2 million underinsured Americans - "based on their out-of-pocket health care costs relative to their incomes." That leaves a lot of underinsured people uncounted.

Here's the full text of the Health Affairs article, and here's an interview that the report's lead author, Cathy Schoen of the Commonwealth Fund, did with PBS. There's both a video and transcript there - and links to resources like this - U.S. vs. other nations.

Commonwealth's proposal

Commonwealth Fund's principal researchers and president have authored an article for Health Affairs with Lewin Group modeling that shows a path to dramatically improving U.S. healthcare. It seems far superior to the flawed Wyden plan.

Health Affairs has a firewall, but you can see a synopsis of the plan at Commonwealth Fund or at Medical News Today.

Here are the basics, from Medical News:

• A national entity known as a "connector" that would offer individuals and small businesses a choice of private plans or a Medicare Extra plan.
  
• Requiring that all applicants be given health insurance at standardized rates regardless of their health status.
  
• Tax credits to make sure premiums are affordable. Premium assistance would be available to all to ensure that premiums do not exceed 5 percent of income and 10 percent of income for higher-income tax filers.
  
• Expanding Medicaid and SCHIP to cover all low-income adults and children below 150 percent of the federal poverty level with modest copayments for health care services and no premiums.
  
• Requiring that everyone enroll in a health insurance plan-uninsured individuals who file taxes would be automatically enrolled.
  
• Requiring employers to either provide health insurance or pay 7 percent of payroll up to $1.25 an hour into a pool to help to finance coverage.
  
• Medicare reforms that would extend Medicare Extra benefits to current Medicare beneficiaries, eliminate the two-year waiting period for Medicare for the disabled, and allow adults age 60 or older to buy in to Medicare.

Colleges not covering students

One of the givens for college used to be health coverage. No more. Business Week has an article on health care falling apart for college kids as well -- probably the healthiest demographic there is. "Is your kid covered?" notes that insurance companies make big profits here, but leave some families with big bills. Those would be the families whose kids get sick.

If for-profit insurance can't even cover college kids it's worse than worthless.

More than half of the insurance plans recommended by colleges offer benefits of $30,000 or less, according to a survey published in March by the General Accounting Office, an arm of Congress. Many plans have further limits that prevent payout of even modest maximums...

The vigorous health of most college students helps make insuring them a lucrative niche, according to industry consultants. Most insurance companies, even if publicly traded, don't break out separate financial results for their student-oriented policies. But some schools disclose an indication of the profitability of policies sold to their students: the so-called benefits ratio. This shows the percentage of premiums returned to customers in the form of benefit payouts. Large health insurers typically have overall ratios of about 80%, meaning 20% of premiums goes to profits and administrative costs.

In several cases where BusinessWeek (MHP) was able to obtain benefits ratios from colleges or universities, the percentage was well below 70%. Anything below 75% ought to be grounds to negotiate a better deal, according to Eric Engstrom, president of Keeling & Associates, a consulting firm in New York.

At Palm Beach Community College, the benefits ratio for the spring semester of 2008 was 42.6%, according to reports provided to the school by UnitedHealthcare.

In previous semesters the benefits ratios dipped as low as 10.2% and 13.8%. This means the college's plan has been a veritable gold mine for UnitedHealthcare. At the University of South Florida in Tampa, which offers a plan from American Fidelity Assurance, the ratio this academic year is 35%, down from 71% and 61% the previous two years, respectively.

Did you get that? UnitedHealthcare paid out as low as 10.2% in benefits some semesters. Compare that to 97% for Medicare or Canada's universal health care plan (also called Medicare).

Now here's the key to change. Upon finishing that article in Business Week, do most readers:

a) Look into healthcare to find out for themselves what's wrong with our so-called system,

b) Protect their own kids by ensuring that Max and Jessica are still fully covered under dad's plan, or

c) Call their broker and invest in UnitedHealthcare.

Moyers covers the Cal Nurses

Take a look at this great segment from Bill Moyers' Journal, at PBS.

It brings back my favorite observation from T.R. Reid's "Sick Around the World" special: the fact that we in the U.S. don't have a health care system, we have a market. In the same way that sprawl isn't city planning. It's what happens when there isn't city planning.

Donna Smith is 47,000,001

Donna Smith blogged the other day at Michael Moore's Sicko blog that she's joined the ranks of the uninsured.

She emails today that it's not 18,300 deaths a year (estimate from the Institute of Medicine) any more. That's 50 per day, and we've all been using that figure for a long time. The number is now estimated at 22,000/year -- 137,000 from 2000-2006. Donna writes:

I wrote the blog about joining the ranks of the uninsured. In reviewing the Jan 2008 Urban Institute report raising the estimates of the dead due to a lack of insurance, I plan to write yet another blog hoping I will not become yet another statistic in 2008: 22,001. I'd have to write that piece in advance of being added to that list --

Anything for the cause, Donna, but that's a bridge too far...

And so what are the rest of us left feeling? There's guilt in with the anger. I won't name the people in my family who are uninsured, even after Paul's death. But I will say that they're not gaming the system any more than Donna is. If they could afford coverage they would have it.

How many families have to have uninsured members, and how many people have to die -- from underinsurance or from being uninsured -- before enough of us say enough.

I think we've reached the tipping point.

101,000 excess deaths in U.S.

A recent study published in Health Affairs show that there aren't just 18,000 deaths a year because of our idiotic system, there are actually 101,000 excess deaths annually. France, Japan and Australia rated best and the United States worst. The study focused on preventable deaths due to treatable conditions in 19 industrialized nations. The U.S. health care system's shortcomings resulted in 101,000 more deaths than if we'd had a system based on care rather than profit.

Researchers Ellen Nolte and Martin McKee of the London School of Hygiene and Tropical Medicine tracked deaths that they deemed could have been prevented by access to timely and effective health care, and ranked nations on how they did.

They called such deaths an important way to gauge the performance of a country's health care system.

Nolte said the large number of Americans who lack any type of health insurance -- about 47 million people in a country of about 300 million, according to U.S. government estimates -- probably was a key factor in the poor showing of the United States compared to other industrialized nations in the study.

"I wouldn't say it (the last-place ranking) is a condemnation, because I think health care in the U.S. is pretty good if you have access. But if you don't, I think that's the main problem, isn't it?" Nolte said in a telephone interview.

Spain was fourth best, followed in order by Italy, Canada, Norway, the Netherlands, Sweden, Greece, Austria, Germany, Finland, New Zealand, Denmark, Britain, Ireland and Portugal. The United States comes in last.

Good comment on this at Cronespeaks:

As a Canadian, I do not want to see the USA get universal health care or free universal education. Much of Canada’s increasing economic advantage comes from the malaise and stupidity of directly competing demographic areas in the USA; and we are winning because of our healthcare and educational advantages.

Recently, Toyota chose Ontario Canada over Alabama as a site for their largest manufacturing site. Why?

Toyota cited a much more highly educated workforce and the savings in healthcare costs as the deciding factors in choosing Canada. Please keep your present system in the USA — it’s “Merkan, so it’s gotta be the ‘best’!

It could be that Stuart Butler, Canada's anti-Michael Moore "brilliant" filmmaker, Stuart Browning might sign her on to help him... You think he'd go for that?

Bravo, Ootpoot!