Between the Lines

Between the Lines by David Lias Maybe I shouldn�t complain.

I mean, my health insurance is one of the bennies I get for working here. I don�t particularly like to appear like a dog who bites the hand that feeds him.

But after a recent exhausting episode on the telephone with our insurance company about my daughter�s dental bill, where I communicated with recordings by punching numbers on a telephone keypad most of the time, I came to realize that our nation�s health insurance programs are not only becoming less personal, they�re also becoming flawed in many other ways.

And nobody is doing anything about it.

The people who could have the most impact on our nation�s health insurance system � our national political leaders in Congress � haven�t been able to get much done lately because they�re too busy running for re-election.

Private health insurance premiums are rising at an unsustainable average of about 13 percent per year � and as much as 25 percent in some areas of the country. Coverage is shrinking, as more employers decide to cap their contributions to health insurance plans and workers find they cannot pay their rapidly expanding share.

And with the rise in unemployment, more people are losing what limited coverage they had. Last month, the Census Bureau reported that nearly 1.5 million Americans lost their insurance in 2001.

I�m not smart enough to figure out how insurance programs ought to work, so I don�t have a clue to the causes of our nation�s health insurance dilemmas.

Marcia Angell, the former editor in chief of the New England Journal of Medicine, and a senior lecturer in social medicine at Harvard Medical School, knows what she�s talking about, however.

According to Angell, the fatal flaw in the system is that we treat health care as a commodity. That has been the case for a long time, but the effects were masked during the economic boom of the 1990s. Now, with the recession, the irrationality of that approach is exposed.

When health care becomes a commodity, the criterion for receiving it is ability to pay, not medical need. Private insurers and providers compete with one another to avoid getting stuck with high-cost patients, so they can keep more of their revenues. But this game of hot potato takes a lot of oversight and paperwork.

In fact, the hallmark of the system is the extent to which health funds are diverted to overhead and profits.

Look at what happens to the health-care dollar as it wends its way from employers to the doctors and hospitals that provide medical services. Angell notes that private insurers regularly skim off the top 10 percent to 25 percent of premiums for administrative costs, marketing and profits.

The remainder is passed along a gauntlet of satellite businesses � insurance brokers, disease-management and utilization-review companies, lawyers, consultants, billing agencies, information management firms and so on.

One more absurdity of our market-based system: the pressure is to increase total health-care expenditures, not reduce them. Presumably, as a nation we want to constrain the growth of health costs. But that�s simply not what health-care businesses do. Like all businesses, they want more, not fewer, customers � but only if they can pay.

All piecemeal attempts to improve the system � while keeping it market-based � have run into the following dilemma: if access to services is expanded, costs rise; if costs are lowered, access is cut. That�s the way it is. The only way to avoid this dilemma is to change the system entirely.

Angell suggests that what we need is a national single-payer system that would eliminate unnecessary administrative costs, duplication and profits. In many ways, this would be tantamount to extending Medicare to the entire population.

Many people believe a single-payer system is a good idea, but that we can�t afford it. The truth is that we can no longer afford not to have such a system. We now spend more than $5,000 a year on health care for each American � more than twice the average of other advanced countries. Nearly half that amount is wasted.

It makes more sense to pay only once, perhaps through a new tax on income earmarked for health care (in the same way Medicare is financed through payroll taxes).

Angell says a single-payer system is not socialized medicine. Although a new national program � like Medicare � would be publicly financed, the doctors and hospitals would not work for the government, but would remain private.

Some fear onerous government regulations from a national payment system, but surely nothing could be more onerous for patients and providers than the multiple, intrusive regulations imposed on them by the private insurance industry today.

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