Mandated Health Care Comparisons, Comments, & Questions - What Are Your Answers?
© David Burton 2011
Mandated Health Care Comparisons, Comments, & Questions - What Are Your Answers? |
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Massachusetts, in 2006, enacted a “Massachusetts Health Care Reform” program under then Governor Mit Romney. The program, commonly referred to as RomneyCare, has now been in existence for nearly 5 years and its impact can now begin to be seen.
The costs of Obamacare are only now beginning to be fully comprehended by business, citizens and even the politicians that enacted the health reform legislation. To date, “roughly 1,200 businesses, unions and government entities {have received exemptions from the requirements of the new federal health care reform law and} are now exempt from Obamacare. Why did they seek the exclusion? Because the mandate would financially cripple the organization or business.” (Ref. 7) In order to postpone the devastating impact of the greatly increased health care costs that will come with Obamacare, implementation of some features of the program will not go into effect immediately. “The new entitlement {Obmacare} creates - government-subsidized health insurance for 32 million Americans doesn’t kick in until 2014. … Obamacare does not create just one new entitlement (health insurance for everyone); it actually creates a second - long-term care insurance. With an aging population, and with long-term care becoming extraordinarily expensive, this promises to be the biggest budget buster in the history of the welfare state.” (Ref. 12) There are other unintended consequences of Obamacare that can almost certainly be expected. As has been pointed out, with the implementation of mandated health care in Massachusetts, emergency room waits are increasing. The same effect has already begun to be observed nationally and can only be expected to worsen under Obmacare, as primary care physicians close shop because of reduced payments for their services, or as they withdraw from Medicare because of increases in patient loads. “Emergency rooms are disappearing: Nearly 30 percent of urban ERs have closed in the past two decades, yet patient visits have increased more than 35 percent … The main reason for the shutdown? Funding. Because ERs are required to treat everyone - regardless of their ability to pay - the facilities don’t always receive reimbursement, which can result in closures.” (Ref. 13) Obamacare may well require all seniors “to give up their private health plans and health savings accounts … and enroll in medicare Part A, whether they want it or not. … {even though} people on Medicare are not treated as well in hospitals as those with private insurance.” (Ref. 14) While it was promised that under Obamacare everyone would be able to keep his current health insurance, this may well turn out to be an empty promise since “millions of workers will find themselves adrift because their employers will have every incentive to {cut costs and} dump them onto the public rolls.” (Ref. 12) Concierge Medical Services My wife and I utilize what is known as Concierge Medical Services. We like it. We see one primary care physician whenever medical services are required. We have little to no wait times for scheduling appointments or in seeing our physician on short notice. We also appreciate the handling of appoints and referrals to other physicians or hospitals whenever that is require. Yes, we pay for this extra attention, but we feel that the added cost is worth the extra service provided. Copncierge medical services are apparently becoming more popular as government intervention in the field of health care continues to be expanded. {One doctor announced to her patients that} “she is moving to some kind of “concierge” service – she figures she basically provides that kind of above-average service already, and this is a way to reduce her patient load (from about 4000 to about 400), and escape some of the regulatory burden that Obamacare is going to impose. “Expect to see more of this.” (Ref. 15) Government mandated health care threatens to increase the work load of physicians, increase the amount of paperwork required by regulatory burdens and, at the same time, reducing the amount of compensation that they receive. Moving to concierge serves avoids such problems. {Another doctor} “does not take Medicare, Medicaid or private insurance. Patients, however, can use those health plans to fill prescriptions or see a specialist. “Despite … out-of-pocket expense, concierge care is in high demand because of health care reform. “Most of {the} incoming patients are not the affluent elite, but from the middle class, who want to select a personal physician before health care reform limits choices for them. “There are now about 5,000 boutique medical practices in the country. More than 1,000 opened within the last year, according to the Society for Innovative Medical Practice Design. Many more are expected in coming years, as health care reform laws take effect. “Under the law, Americans will be required to carry insurance, but physicians won't be required to accept it. “It's a situation {that} will become worse as millions more suddenly-insured patients crowd waiting rooms.” (Ref. 16) The question also is, why should the doctors, or anyone else, be restricted by the government as to how much money they can earn. Where is that in the Constitution? Foreign Health Care Systems We hear many stories about foreign medical care systems. Depending upon which side of the fence these stories come from, the U.S. system is far superior or the foreign systems, by far, surpass the cost and quality of of the American health care system - you decide. In the following paragraphs are excerpts from Ref. 17 on the issue of foreign health care systems vs the American form of health care system. “A common misconception surrounding the health care debate in the United States is that many other countries have already figured out the answers, and that all America has to do is replicate a foreign health care system and the problems will be solved. There are accounts of how everyone in Canada gets top quality medical care at reasonable costs. Germany and Britain are held up as examples of countries with effective health care systems. How is it that America spends more on health care than every other country and still does not manage to provide coverage for all its citizens?” (Ref. 17) “Canada, for example, has a national health system called Medicare, which covers all of its citizens. The Canadian government finances Medicare {through} taxes. All medical bills go to the government for reimbursement, so much of the paperwork is eliminated. Canada's health system is the second most expensive in the world, after the United States. Canadians pay about ten percent of their income for this universal insurance. {A Canadian family with an income of $100,000 would pay health care insurance costs of about $10,000 annually.} People can choose their own doctors and see any specialists needed. The range of services is broad and fair because every person—rich or poor—is treated the same. “Canada makes this system work by imposing price controls on doctors and hospitals and keeping to a strict budget. The Canadian system is fair, but is it working? Business leaders say that the high tax rates are negatively affecting economic growth and employment rates in Canada. The tight budget also means that patients often have a lengthy wait for the care they need. Minor procedures and operations are often not available until the problem has become serious or even life threatening. As a result of these problems, benefits are starting to be reduced, and doctors are spending less time with patients (thirty percent less than American doctors). Even as American politicians are arguing that we should reform the U.S. health care system to be more like Canada's, Canadian politicians are urging the adoption of some of America's health care policies. “There are characteristics about foreign health systems to admire: universal coverage, lower costs, and free medical education. Every benefit, however, is balanced by a compromise, such as the limiting of choice and the rationing of services. Higher taxes, for example, help to pay for health care in countries like Germany. “Other countries have also pointed out that one reason for their lower health care costs is that the United States must treat different social problems that can become medical problems. For example, Americans pay for the high rates of teenage pregnancy, drug abuse, and violence. America also has a greater elderly population than many other countries. Both of these factors serve to increase costs for health care in the United States.” (Ref. 17) There are many different health care systems in place around the world. Let’s take a quick look and see how well they seem to work. BRITAIN: Many people in Britain have private health insurance. “Why? Because the service and waiting periods for treatment is abominable under the National Health Service. {In one case, a person} waited for a quadruple bypass for 6 months and died before he got to the top of the waiting list.” (Ref. 18) “Unlike the French, German and Swiss health systems, the British health service is completely funded by taxes. In 2010 British taxpayers {paid} the highest marginal income tax rate in the developed World! A new rate of 60% {introduced in 2011 is} the highest in the 30 countries in the Organization of Economic Co-operation and Development. … That {puts} Britain above notoriously high-tax socialized medicine countries such as Denmark, Sweden and Finland. “In addition, Britons pay 15% tax on products and services they buy (value added tax). The tax on gasoline is $3 per gallon. The British cannot deduct their mortgages from their income tax. “These are just some of the taxes necessary to sustain socialized medicine {in Britain}.” (Ref. 18) CANADA: “Some Canadians have resorted to lawsuits to get the care they need in what they and their doctors believe is a reasonable time. In June 2005, the Supreme Court of Canada ruled Quebec could not ban private health insurance for services covered under the government-run system. The lawsuit was brought by a … doctor … and {a} businessman, who waited a year for hip replacement surgery. ‘"Access to a waiting list is not access to health care,’ the Supreme Court said in its ruling striking down Quebec's ban. “A similar lawsuit was filed in Quebec on behalf of 10,000 women with breast cancer who were forced into long waits for radiation therapy. “… as long as Canada keeps a single-payer health care system, Canadian patients will continue to be forced into long waits for needed care. {The} “wonderful visions of Canada's socialized health program tend to ignore the very real costs that system imposes on Canadians in need of medically necessary care: Long wait times that can stretch into months or even years of painful and detrimental delay. The reality is that Canada's program is a model for no one, not even Canada. (Ref. 18) I should note that Canadians I have met claim to like their system and have stated that they would not trade it for the U.S. system. FRANCE: In France, “Employees pay 20% of their gross salary, the self-employed pay even more. This discourages free enterprise! That means a {family} grossing {$100,000 per year} would pay {$20,000} … for the basic health insurance. “The French share Americans' distaste for restrictions on patient choice and they insist on autonomous private practitioners rather than a British-style national health service, which the French dismiss as ‘socialized medicine.’ “Most physicians in France participate in the nation's public health insurance. “Malpractice liability is greatly diminished by a tort-averse legal system, and medical schools, although extremely competitive to enter, are tuition-free. Thus, French physicians enter their careers with little if any debt and pay much lower malpractice insurance premiums. Nor do France's doctors face the high non-medical personnel payroll expenses that burden American physicians. Sécurité Sociale has created a standardized and speedy system for physician billing and patient reimbursement using electronic funds. It's not uncommon to visit a French medical office and see no nonmedical personnel. Moreover, in contrast to Canada and Britain, there are no waiting lists for procedures and patients need not seek pre-authorizations." “Private health insurers are also central to the system as supplemental insurers who cover patient expenses that are not paid for by Sécurité Sociale. Indeed, nearly 90 percent of the French population possesses such coverage, making France home to a booming private health insurance market. “… the French confront ongoing problems. Today French reformers' number one priority is to move health insurance financing away from payroll and wage levies because they hamper employers' willingness to hire. Instead, France is turning toward broad taxes on earned and unearned income alike to pay for healthcare. (Ref. 18) GERMANY: “At the moment Germany has the best value in health care in Europe. It is not funded by taxes, and it is compulsory. “All German workers pay about 8 percent {$8,000 based upon an annual income of $100,000} of their gross income to non-profit insurance companies called sickness funds. Their employers pay about the same amount {another $8,000}. Workers can choose among 240 sickness funds. Everybody is in the system except the self employed, civil servants and people earning more than $72,000 per year. These people can buy private health insurance from for profit health insurance companies.” "It's important to remember that the German government doesn't provide health care or finance it directly. It does regulate insurance companies closely, the nonprofits in the main system and the for-profits for people who want the best. The insurers can't raise rates if people get sick or raise premiums too much as you get older. The government also requires insurers to keep costs down so things don't get too expensive. Germany, like most countries, has the problem of rising costs. How is the German system different to the American? Premiums are based on how much you earn! 8% of an employee’s gross wage plus at least another 8% from the employer. You could have two people, same age on the same plan, working in the same company one earns $30,000 per year and one earns $60,000 per year. The one with the higher gross income would pay double what the lower income employee is paying! But the Germans like the system and it works.” (Ref. 18) RUSSIA: “Russia is socialized medicine at its worst. “Health care is supposed to be free in Russia, but Russians know that every hospital has its under-the-table price list.” “Russia is an unhealthy nation, and its health-care system is just as sick. Its hospitals are understaffed, poorly equipped and rife with corruption. (Ref. 18) SWEDEN: In Sweden, one man had to wait eight months during 2003 and 2004 for a hip replacement operation. As a result, {he} walked with a limp, reportedly used strong pain medication and had to reduce his workload.” “Sweden's Single-Payer Health System Provides a Warning to Other Nations.” (Ref. 18) SWITZERLAND: “All Swiss insurance is private insurance. Insurance companies are mandated to offer the same ‘basic benefits package.’ Some physicians operate outside the negotiated schedules and individuals can purchase supplemental insurance to cover the cost of these higher cost physicians. 60% of Swiss citizens only have a basic plan. “There is no waiting for treatment and everyone must buy health insurance. It is the best system in Europe, but expensive. “The World Health Organization ranks Switzerland as second only to America in terms of timely care.” (Ref. 18) SUMMARY: “Every Country is having problems with healthcare, some far worse than America!” “Germany implemented health insurance in 1883 and has continued improving it ever since. It receives almost no money from taxation, no tax-and-spend, it is incredibly efficient, … and it is cheaper than the French and Swiss systems.” “The French started their system in the 1930’s, it is compulsory for all ages and is very similar to our Medicare and you also buy a supplement … France did not use any taxes to help fund it until very recently, but now just like our Medicare, costs keep rising. Now they realize their system is expensive and President Sarkozy is making it more like the American system because as it is presently set up, it penalizes the self employed, discouraging entrepreneurism!” “Countries using socialized medicine (single payer) including Denmark, Sweden, Finland, Norway, Britain and Canada all have long waiting times for care, also they are like bottomless pits that swallow more and more tax revenues. “In some of these countries, for example Norway and Britain, care can be denied if it is not deemed to be cost effective. “Thousands of Canadians come to the USA every year because they can’t get treatment in Canada and to crown it all they have to sue their own Government so they can buy Private Health insurance in order to save their lives. “Slowly but surely these countries are introducing private insurance in order for their citizens to receive good health care in a timely manner and in modern facilities. Their citizens are finding that tax-and-spend doesn’t deliver quality health care.” “It is obvious that the Swiss, French and German systems are the best. Of these the German model is the least expensive. “So why don’t we just use the German system, like the Dutch have since 2006? Why are so many politicians obsessed with socialized medicine? “Even the Russians can’t make it work! The answer is simple. Socialized Medicine means more control of people’s lives and money, plus it allows hidden taxes and spending, generating more power, and some politicians just can’t get enough power. “If socialized medicine pays for itself, why are our politicians already arguing about tax increases? (Ref. 18) The Costs of Government Mandated Health Care Programs In Massachusetts, advocates of RomneyCare promised reduced health care costs. RomneyCare hasn’t delivered on this promise. Instead, costs have risen and are projected to rise even more sharply. Since the enactment of the state-mandated health care program in Massachusetts health care spending is 15 percent higher on a per capita basis than the rest of the nation. Before RomneyCare, the average Massachusetts family was spending $11,000 a year on coverage. Now, it’s $17,000 and in five years, that same family is projected to be paying $25,000 for their insurance. The real costs of Obamacare are obscured by smoke and mirrors. What is probably true is the fact that it will be devastatingly expensive. It is certainly true that health care is expensive and getting more expensive. There are several reasons for this: greater life spans, new expensive drugs, new expensive medical procedures and equipment and still more. Government mandated health care programs that provide good quality health services are expensive. One tends to get what one pays for. The Best Health Care that Money Can Provide Some hypothetical and some not-so-hypothetical examples. You are 80 years of age. You have a life-threatening illness. Your life can be extended by another 10 years if you receive medication and treatment that costs $10 million per year for a total cost of $100 million. You cannot afford to pay for the medication and treatment. Your quality of life will be extremely poor during these 10 years of extended living. Should the rest of America assume these health care costs? What should we as Americans do if there 1 million seniors in the same situation? What if there are 10 million seniors in the same situation? John is able bodied. He is capable of working to earn a living and support his family. John has decided to take advantage of American largesse. He is an expert in gaming the system. He quits his job, applies for welfare and insists upon taxpayer funded health care for himself and his family. Are we willing to indefinitely pay the health care costs of John and his family? Frank is a hard working entrepeneur who has built up a company that employs 200 workers. He pays his worker well, provides health insurance and other benefits for them and their families. The health care insurance costs to his company suddenly rise, reducing the amount of money that he, as the owner of the small business, takes home. To further make his business unprofitable, he is forced to hire five office workers to fill out the forms and comply with regulations that are imposed by the government. He is considering closing his business, laying off his 200 employees and either taking a salaried job or applying for unemploment. Will America penalize Frank and other productive segments of its population in order to support John and other nonproductive elements in its society? Let’s look at some not-so-hypothetical cases. In 2010, “the U.S. Food andDrug Administration approved Provenge, … for men with advanced prostate cancer. Clinical trials showed that Provenge extended life by an average of four months. Then came the price tag: $93,000 for a course of treatment.” In March, Medicare … announced that it would cover Provenge.” (Ref. 19) Other drugs have similar high price tags. Neither patients, nor government programs, nor employers can afford the high costs of such drugs. How much is too much for a drug cost? Should there be a limit to spending for life-saving drugs or treatments? How much is prolonging someone’s life worth? What is the dollar value of life? Is one person’s life worth more or less than someone else’s? “The United Kingdom already limits its spending for life-saving drugs. … {Britain} “generally supports approval for drugs that offer an additional year of good-quality life for less than $30,000 to $50,000. “The goal is to offer the population as a whole the best health care the country can afford.” (Ref. 19) Note that Britain does not offer to provide the best health care that money can buy. It only claims to offer the best care that the country can afford. Are we in the United States willing to adopt the same policy? Can we afford to shell out whatever a life-prolonging drug costs? The FDA approves a drug on the basis of its efficacy. Should approval also be based upon cost? Failure to consider costs as well as efficacy contributes to the unsustainable growth in heath care costs in this country. While rationing of health care services may not be appealing, neither is blind overspending. Health Care Financing The following mateial is abstracted from Reference 20. "The methods used to finance personal health care service play a major role in shaping a country's health care system." "In most markets, buyers and sellers trade directly. A person who wants to buy a loaf of bread pays the merchant for that bread. … The health care market, however, is quite different. A basic characteristic of health care systems in all developed countries is that the majority of payments for medical services flows through third parties. A third party is an entity, usually an insurance company or government agency, that pays for medical services but does not receive or provide health care services." "The nature of health care financing systems varies widely across developed countries. With the exception of the United States {until the recent enactment of Obamacare} and South Africa, all of the developed countries have implemented some kind of national health insurance system … Some countries (such as Germany and France) require employers to offer and employees to purchase a health insurance plan with payroll taxes as the major source of funding. In other countries, such as Canada, general tax revenues supply the major source of funding for their health insurance systems. Until the passage of Obamacare, the majority of employed people and their dependents in the Unite States "obtained health insurance through their employment. …The provision of health insurance by employers {has been} strictly voluntary (other than the state of Hawaii) with few regulations governing how insurance {was} provided." "Although the United States {did} not have national health insurance for all its citizens, it {did} have a number of public programs that provided health insurance or other types of health programs for the poor, the disabled, and the elderly. The three most important public programs {have been} the Medicare program, the Medicaid program, and the State Child's Health Insurance Programs (SCHIP)." "The SCHIP program, first established in 1996, provided health insurance for children in families with low incomes, but not low enough to qualify for family coverage under Medicaid." In the U.S. "in 1998, expenditures on personal health care services totaled $1 trillion with 19.6 percent paid directly by patients (out-of-pocket payments) and 80 percent paid by third parties. … Third parties paid for 97 percent of hospital care but only 55 percent for drugs and other services. "In general, health insurance programs funded predominantly through income taxes are the most progressive with respect to income. People with the highest incomes pay proportionately more than people with the lowest incomes, regardless of their use of medical services. On the other hand, insurance funded mainly by premiums is the most regressive because people with lowest incomes pay a higher proportion of their total income than people with high incomes. In general, payroll taxes are moderately regressive because the percentage of an individual's income that comes from wages … tends to decline as total income rises. Under national health insurance systems such as those of Great Britain, Germany, and Canada, the financial burden of illness is broadly spread across society and the actual expenditures made by the sick … are much less than the actual cost of their medical care. By contrast, in the United States a higher proportion of medical expenditures {has been paid} paid directly by the sick and many insurance plans are experience rated, thus the financial burden of illness {has been} more concentrated on the sick." "Financing methods can influence consumers' decisions to seek medical care and how much and what type of medical care they seek. Consumers with no cost-sharing requirements are more likely to seek and use care because they don't have to make direct payments for their care. Likewise, consumers with high cost-sharing requirements are somewhat less likely to seek and use care. Financing methods may influence medical providers' decisions as to what treatments to offer and how frequently to interact with patients." "In addition to the financing methods discussed above, the health care system in all countries is shaped by the general regulatory environment within which consumers make decisions about accessing the health care system and providers make decisions about the types of treatments to provide or recommend. There are significant differences across countries regarding the extent of centralized regulation over the number and location of hospital beds, the number and specialties of physicians in training, physician licensing, practice location and mobility, and the ability of hospitals or providers to establish clinics or purchase advanced technology. Additionally, the level of control government authorities have over aggregate health care budgets varies across countries. In general, the more a health care system is directly funded by the government, the more governmental control there is over the size of the health care system. … In cases were governments regulate the price of care, … providers can still influence the flow of payments by altering the types or intensity of medical care. However, it is possible to impose budgetary control in a system where prices are directly controlled. For example, in the United States the Medicare program imposes physician expenditure targets called volume performance standards and bases the Medicare fee schedule in part on how well physicians (in the aggregate) meet the volume performance standard. Likewise, in the Canadian province of Ontario, the government imposes income limits for physicians and as payments to a physician approach the income limit, the proportion of the fee paid decreases. In general, there {has been} much less aggregate control over the health care delivery system in the United States {than} there is in other countries. (Ref. 20) Questions that Need Answering Government mandated health care is at best highly complex. Very few, if any, understand what is included in the mandates and, more significantly, the consequences of the mandates have been hidden or are unknown. However, what has become crystal clear is the undeniable fact that these mandates are extremely expensive. The health care mandate questions that need to be addressed are:
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| 8 July 2011 {Article 106; Undecided_19} |