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by Chellyse66

Updated Jul 11, 2001 at 02:59 PM by Chellyse66

After posting the piece about Nurses traveling to Germany and reading the feedback. I would like to open up a debate on this BB about "Universal Health Care" or "Single Payor Systems"
In doing this I hope to learn more about each side of the issue. I do not want to turn this into a heated horrific debate that ends in belittling one another as some other charged topics have ended, but a genuine debate about the Pros and Cons of proposed "Universal Health Care or Single Payor systems" I believe we can all agree to debate and we can all learn things we might not otherwise have the time to research.
I am going to begin by placing an article that discusses the cons of Universal Health Care with some statistics, and if anyone is willing please come in and try to debate some of the key points this brings up. With stats not hyped up words or hot air. I am truly interested in seeing the different sides of this issue. This effects us all, and in order to make an informed decision we need to see "all" sides of the issue. Thanks in advance for participating.
Michele


I am going to have to post the article in several pieces because the bulletin board only will allow 3000 characters.So see the next posts.

[Chellyse66]

Part 1 Single Payor

HEALTH CARE REFORM: THE GOOD, THE BAD, AND THE UGLY
by Michael Tanner

Michael Tanner is director of research at the Georgia Public Policy Foundation.



While Congress has actually taken little action on
health care reform, there has been no shortage of discussion
on Capitol Hill. This year alone Congress has considered
more than 100 bills on health care that range from two pages
to more than 200 pages. In addition, the Bush administration
released a 94-page outline of its health care reform program.
President-elect Bill Clinton also has a health care plan.
And nearly every think tank with a word processor has con-
tributed a proposal as well.

Those proposals run the gamut--from good to bad to ugly.
The ideas receiving the most discussion in the media are
those that would increase the involvement of government in
health care. That first group of proposals is focused on
methods of financing expanded access to health insurance.
They generally take one of two approaches: (1) a universal,
single-payer, government-operated, tax-funded system or (2) a
"play or pay" system, built around a mandate on employers.
The second set of proposals attempts to accomplish the same
goals without spending more money. Those proposals often
focus on regulatory manipulation of the insurance industry.
Most other proposals would change the behavior of health care
consumers, generally through some form of tax incentive.


Single-Payer Systems

One of the most dangerous health care reform proposals
currently being considered is the call for a single-payer,
government-operated, tax-funded system--the type of system,
generally referred to as national health care, currently
operated in Canada, Europe, Australia, New Zealand, and else-
where.

The legislation generally cited as the classic example
of a single-payer health care plan is sponsored by Rep.
Marty Russo (D-Ill.) and Sen. Paul Wellstone (D-Minn.).
That legislation specifically establishes health care as an
entitlement for every American citizen. Every person would
be issued a national health card. Payment for all medically
necessary services would be provided through a government-
operated program, which would be funded by taxes. Benefits
would include a plethora of medical services, including
long-term care. The federal government would establish a
national budget and individual state budgets for operating
expenses, capital outlays, and medical training. Individual
hospitals would operate on preset yearly budgets. Physi-
cians would be reimbursed on the basis of fees determined by
the government. The national plan would replace all current
government programs, including Medicare and Medicaid.(1)

A single-payer national health care system would come
at enormous cost to American taxpayers. For example, Russo-
Wellstone would require employers and the self-employed to
pay a tax equal to 7.5 percent of wages. The top individual
tax rate would rise from 31 to 38 percent. Corporate income
taxes would increase from 34 to 38 percent. Social Security
benefits would be taxed at 85 percent rather than the cur-
rent 50 percent. And the elderly would be assessed a $55
per month fee for long-term care.(2) Even those levies may
not be enough to pay for national health care. Some econo-
mists put the cost as high as $339 billion per year in addi-
tional taxes.(3)

For all that tax money, we would buy surprisingly lit-
tle health care. The one common characteristic of all na-
tional health care systems is a shortage of services. For
example, in Great Britain, a country with a population of
only 55 million, more than 800,000 patients are waiting for
surgery.(4) In New Zealand, a country with a population of
just 3 million, the surgery waiting list now exceeds
50,000.(5) In Sweden the wait for heart x-rays is more than
11 months. Heart surgery can take an additional 8 months.(6)
In Canada the wait for hip replacement surgery is nearly 10
months; for a mammogram, 2.5 months; for a pap smear, 5
months.(7) Surgeons in Canada report that, for heart
patients, the danger of dying on the waiting list now ex-
ceeds the danger of dying on the operating table.(8) Accord-
ing to Alice Baumgart, president of the Canadian Nurses As-
sociation, emergency rooms are so overcrowded that patients
awaiting treatment frequently line the corridors.(9) Table 1
gives the average wait for various types of physicians' ser-
vices in five Canadian provinces.


Table 1

Canadian Survey of Physicians: Average Weeks Waited by
Patients (by Specialty)
__________________________________________________ ________________
B.C. N.B. Nfl. Man. N.S.
__________________________________________________ ____

Plastic surgery 13.2 36.2 37.0 11.0 26.3
Gynecology 8.4 10.9 5.3 9.0 9.6
Ophthalmology 11.6 5.2 2.9 12.8 10.7
Otolaryngology 12.2 7.2 N/A 7.0 14.7
General surgery 4.0 2.5 8.0 8.2 4.0
Neurosurgery 4.2 8.3 9.0 10.5 5.8
Orthopedic 15.8 14.6 18.5 20.6 19.7
Cardiology 14.0 10.0 42.6 14.7 26.0
Urology 8.3 13.2 5.0 6.7 7.1
Internal medicine 5.5 4.5 2.2 3.3 2.0

__________________________________________________ _____________

Source: Fraser Institute, cited in Reason, March 1992.


Sometimes the rationing of care is even more explicit:
care is denied the elderly or patients whose prognosis is
poor. In Britain kidney dialysis is generally denied pa-
tients over the age of 55. At least 1,500 Britons die each
year because of lack of dialysis.(10)

Countries with national health care systems also lag
far behind the United States in the availability of modern
medical technology. It is well documented that in Canada,
high-technology medicine is so rare as to be virtually un-
available.(11) That comparison holds for other countries as
well. Advanced medical technology is far more available in
the United States than in any other nation.(12) In addition
to being biased against new medical technologies, national
health care systems generally discriminate against nontradi-
tional practitioners, such as naturopaths and chiroprac-
tors.(13) Figure 1 shows the availability of some high-tech
medical technologies in the United States, Canada, and Ger-
many.

Furthermore, national health care systems do not con-
trol the rising cost of health care. Proponents of national
health care make much of reported differences in the propor-
tion of gross domestic product spent on health care by Cana-
da and the United States. It is true that Canada spends
only about 9 percent of its GDP on health care, while U.S.
costs have skyrocketed to more than 14 percent of GDP.(14)
However, such comparisons are seriously misleading.


Figure 1

Availability of Medical Technologies


[Graph omitted.]


Sources: Rublee, "Medical Technology in Canada, Germany and the
United States, Health Affairs, Fall 1989; John Goodman, "National
Health Insurance and Rural Health care, "American Farm Bureau
Research Foundation; and Eli Lilly Company.


Between 1967 and 1987 the Canadian GDP grew at nearly
twice the rate of the U.S. GDP. Therefore, any comparison
of health spending should be adjusted to compensate for the
different rates of economic growth. Additional adjustments
should be made for such factors as population growth; gener-
al inflation; currency exchange rates; the larger U.S. el-
derly population (the elderly require more, more expensive,
health care); higher U.S. rates of violent crime, poverty,
AIDS, and teen pregnancy; and greater U.S. investment in
research and development. When all such factors are taken
into account, Canadian health spending is virtually identi-
cal to that of the United States and has actually been ris-
ing faster over the last several years.(15) Indeed, Canadian
public policy experts warn that health care costs are rising
so rapidly that "they are crowding out every other public
spending priority--social services, the environment, educa-
tion. All are being shortchanged to feed an inefficiently
organized health care system."(16)

[Chellyse66]

Part 2 Pay or Play

Play or Pay

The second most commonly discussed proposals for health
care reform are called "play or pay." Under a play-or-pay
plan, employers would be required either to provide health
insurance for all workers or to pay a tax that would fund
health insurance for those who remain uninsured.

However, attempts to mandate that business shoulder the
burden of health care costs run into the wall of simple
economics. The amount of compensation each worker receives
is directly related to that worker's productivity. Mandat-
ing an increase in compensation by requiring the employer to
provide health insurance does nothing to increase productiv-
ity. Thus, one of two things happens: either consumers must
pay higher prices for products or, more likely in a competi-
tive economy, employers are forced to reduce their payroll
costs to offset the new and increased costs of health bene-
fits. Payroll reductions may take several forms. One is a
reduction in cash compensation, which in practice is unlike-
ly. More probable is a reduction in the number of employ-
ees: either workers would be laid off, or the hiring of new
employees would be postponed. In either case, unemployment
would increase, especially among low-skilled workers for
whom mandated health benefits would constitute a relatively
large increase in compensation.(17)

The National Federation of Independent Business, which
represents more than 500,000 small businesses in all 50
states, surveyed its members and found that 23 percent would
be forced to lay off employees if a play-or-pay system im-
posed an additional cost of only $100 per employee per
month. Nearly 22 percent indicated that they might be
forced out of business altogether.(18) Overall, economists
have placed the estimate of jobs lost under play or pay at
between 630,000 and 3.5 million.(19)

There is a particular unfairness to play or pay. Al-
though most individuals without health insurance are the
working poor, studies show that 25 percent of the uninsured
have incomes of more than 300 percent of the poverty lev-
el.(20) Those people are frequently young, healthy individu-
als who, preferring to spend their discretionary income
elsewhere, have chosen not to purchase health insurance.
Under a play-or-pay system, low-skilled poor people would
lose their jobs to provide those relatively affluent indi-
viduals with government-funded health insurance.

Like single-payer plans, a play-or-pay program would
have enormous costs for American taxpayers and businesses.
The Urban Institute, in a study commissioned by the U.S.
Department of Labor, estimated that play or pay would cost
taxpayers at least $36 billion per year in higher taxes and
would cost businesses an additional $30 billion in higher
health care costs.(21) Other economists warn that play or pay
would increase the budget deficit by $46.5 billion and would
reduce the U.S. gross national product by $27 billion.(22)

Perhaps most important, play-or-pay systems are sure to
degenerate into a national health care system, with all its
attendant problems. Again, the reason is simple economics.
The average business currently pays nearly $4,500 per em-
ployee for health care benefits.(23) That is 22.5 percent of
the salary of an employee making $20,000. If the payroll
tax were 7 percent, as envisioned under current proposals,(24)
the obvious choice for the employer would be to pay the tax
and turn the employee's insurance over to the government.(25)
That scenario is even more likely for big businesses, such
as the automobile industry, that provide very extensive, and
expensive, health benefits.(26) One reason certain big busi-
nesses, such as Chrysler and AT&T, are so supportive of such
a plan is that they would be only too happy to foist their
health care costs onto others. Figure 2 shows the gap be-
tween "playing" and "paying."

As the government assumed responsibility for providing
health care to more and more workers, the play-or-pay system
would transform itself into a Canadian-style national health


Figure 2

The "Play or Pay" Gap

(Graph Omitted)


care system. Indeed, Katherine Swartz of the Urban Insti-
tute has said, "The strongest argument for enacting a 'play
or pay' proposal is that it will enable the country to move
from our current patchwork quilt structure to a single,
national system with time for creating and implementing an
efficiently run public program."(27)

[Chellyse66]

Part 3 Insurance Regulation

Insurance Regulation

The third commonly discussed reform of our health care
system is changing insurance laws. The goal is to reduce
insurance costs or make insurance more available to more
people. The most common target for those reforms is the
small-group market. According to the Employee Benefits
Research Institute, nearly 85 percent of Americans without
health insurance are either employed or are the dependents
of employees. Nearly half of the uninsured workers are
employed by companies with 25 or fewer employees (see
Figure 3).(28)

Some of the proposed insurance market reforms, such as
eliminating mandated benefits, are sensible.(29) However,
there are increasing efforts to manipulate insurance laws to


Figure 3

Working Uninsured by Size of Employer


[Graph omitted. Data presented below.]


Employees Percentage

1-24 47.6
25-29 14.6
100-499 12.2
500+ 25.6

Source: Employee Benefits Research Institute



require insurers to provide coverage for groups or individu-
als that they would not normally cover. The following are
among the most commonly proposed reforms.(30)

* Renewability: Insurers would be prohibited from
canceling policies for groups or individuals within a
group because of deteriorating health of the group or
one of its members.

* Continuity: Insurers would be prohibited from
imposing new restrictions on a previously insured indi-
vidual when he or she changes jobs. Some variations
would go further by making an employee's insurance
package "portable," enabling it to be carried from job
to job.

* Premium Limits: Limits would be imposed on how
much an insurer could vary rates between similar
groups. Limits would also be imposed on how much an
insurer could raise rates from year to year.

* Guaranteed Issue: Insurers would be prohibited
from denying coverage to any small group or excluding
any employee within a group.

* Community Rating: All insured individuals within
a designated category would pay the same rate regard-
less of individual risk.


Most of those insurance reforms have the worthy intent
of expanding access to insurance to small employers that
have been unable to purchase insurance under current prac-
tices. But the reforms may have unintended consequences
that will increase the cost of insurance and actually leave
more people without insurance.(31)

Insurance is a business of risk allocation in which the
insurer receives payment in exchange for agreeing to cover
the expense of the event insured against. The cost and
scope of coverage are determined by morbidity-mortality
statistical analysis. To the degree that insurers are pre-
vented from basing their contracts on actuarial values,
other policyholders will be forced to absorb the additional
costs. Indeed, studies estimate that, while employers with
high-risk employees would certainly notice improved access
to coverage under proposed insurance reforms, premiums could
increase overall by as much as 20 to 25 percent.(32) In some
cases, premiums could rise by as much as 35 percent.(33)

The net result would be to force many small businesses
to drop their present insurance coverage. Some currently
uninsured workers would move into the insurance market, but
others who now have insurance would move out. Thus, insur-
ance reforms would defeat their own purpose.

It should also be noted that most insurance reform pro-
posals would benefit large insurers, whose cash reserves and
larger profit margin give them more flexibility to meet the
new demands, at the expense of smaller companies. For those
large insurers, the specter of national health care is of
more concern than are the problems of insurance reform. If
the small-group market must be sacrificed to prevent nation-
al health care, so be it. That reasoning may explain the
support accorded many reform proposals by the Health Insur-
ance Association of America (HIAA) and Blue Cross-Blue
Shield.

As insurance expert Arthur Ferrara has noted:

Equitable distribution of this burden was not a
high priority of [HIAA]. The larger companies ex-
ercise a commanding position on HIAA committees
and its Board. Concerned over the specter of
national health insurance, they convinced the
Board to adopt a poorly conceived plan. . . . The
cost of the proposal will not affect those large
companies and their policyholders. They are not
significantly involved in the small employer group
market, and are apparently not involved in the
cost of the solution proposed.(34)

[Chellyse66]

Part 4 Managed Competition

Managed Competition

The latest buzzword in health care reform is "managed
competition." Managed competition proposals are being pre-
sented as a compromise that would preserve many free-market
aspects of health care but make the market more accountable
to government control. The concept is generally considered
the brain child of the Jackson Hole Group, an ad hoc coali-
tion of health care executives and academic experts led by
Dr. Paul Ellwood.(35) In Congress it is supported by the Con-
servative Democratic Forum.(36) It has also received consis-
tent and enthusiastic support from the New York Times.(37)

As envisioned under the most common managed-competition
proposals, there would be established a national system of
Health Insurance Purchasing Cooperatives (HIPCs), which
would act as collective purchasing agents on behalf of em-
ployers and individuals.(38) All Americans would be enrolled
in an HIPC, either through their employer or individually.(39)
The HIPC would negotiate with Accountable Health Partner-
ships (AHPs) for a benefits package for its members, much
the way German sickness funds do.(40) AHPs would be private
insurance organizations approved by the government on the
basis of their ability to (1) provide a full array of desig-
nated health benefits, (2) "produce a high level of patient-
oriented results," and (3) control costs.(41) The government
would establish a Uniform Effective Health Benefits package
as a minimum standard benefits requirement, which would
replace current state-mandated benefits. AHPs would be
required to charge all members of the HIPC the same premium
regardless of risk (community rating) and to guarantee cov-
erage to all HIPC members.(42)

Employers would be required to provide coverage for all
full-time employees. Employers would have to pay at least
half the cost of coverage, but to discourage excessive bene-
fits, the employer's tax deduction would be limited to the
amount of the lowest cost plan offered by an AHP. Unlike
the situation under play or pay, employers would not have
the option of paying rather than providing coverage. How-
ever, employers would be required to pay a payroll tax for
noncovered part-time workers. Unemployed people with in-
comes and the self-employed would also have to pay a tax.
Those taxes would be collected by the federal government,
then returned to the states on an "equalized" basis that
took into account the number of uninsured workers in each
state. States with high rates of uninsured would receive
the most funding.(43) States would use that federal money,
plus current money from uncompensated-care and indigent-care
funds, to subsidize insurance purchased by those not covered
through an employer and unable to pay the full insurance
cost themselves.(44) Public programs, such as Medicare and
Medicaid, would have the option of purchasing care through
an HIPC.(45)

The program would be overseen by a new, independent
federal agency, the National Health Board, that would be
removed from day-to-day oversight by Congress or the execu-
tive branch, as is the Securities and Exchange Commission.
The program also envisions three additional agencies estab-
lished by legislation but controlled by a combination of
employers, consumer groups, health care providers, and in-
surers. Those would be the Health Standards Board, to re-
view medical efficacy and assess benefits; the Health Insur-
ance Standards Board, to oversee insurance organization and
market issues; and the Outcomes Management Standards Board,
to oversee a new program for providing increased information
to health care consumers.(46) Figure 4 is an organizational
chart of the managed-competition system.


Figure 4

Managed Competition

Source: Conservative Democratic Forum

(Chart Omitted)



As proposed, managed competition appears to offer a
great deal of management and very little competition. Often
discussed as a compromise between various health care reform
proposals, managed competition incorporates many of the
worst elements of other proposals.

First, as was mentioned earlier, the mandate that em-
ployers provide health benefits for all full-time employees
will cost jobs. Even the Jackson Hole Group admits that
"employer mandates are a form of employment tax."(47) They
claim, however, that explicit taxes would be "fairer" than
the current system of allocating costs.

At the same time, the revenues generated from a combi-
nation of payroll taxes on part-time workers, taxes on the
self-employed and unemployed, and savings from uncompensated
care are likely to fall well short of the cost of providing
extended Medicaid benefits and subsidies for the uninsured.
Those costs are estimated to be least $29.7 billion per
year.(48) Further, the proposal to "equalize" the return of
tax revenue will penalize states with policies that encour-
age economic growth and benefit those states whose high
taxes and business regulations cause slower economic growth.

Second, the proposal creates not just one but four new
government bureaucracies. While no real estimate of the
cost of those agencies has been made, it can be assumed to
be substantial. Even more worrisome is the proposal to
exempt the agencies from legislative or executive oversight.
The history of "independent" agencies, such as the Food and
Drug Administration, the Federal Trade Commission, the Fed-
eral Communications Commission, and the SEC, has been one of
continued expansion, resistance to marketplace innovation,
and frequent episodes of corruption and abuse.

Third, the call for uniform effective health benefits
simply moves the problems of mandated insurance benefits
from the state to the federal level. The inclusion of a
given benefits package in the mandate is much more likely to
be based on the relative lobbying strength of various pro-
vider groups than on a rational view of medical necessity.
Whatever benefits are mandated will increase the cost of
insurance, and consumers will be deprived of the ability to
make individual choices about the types of benefits they
wish to purchase. And fourth, as was mentioned earlier,
requirements for guaranteed issue and community rating will
increase the cost of insurance.

Finally, the proposal is vague about how it will con-
trol overall health costs. The Conservative Democratic
Forum claims that cost controls will result from (1) capping
the tax deductibility for employers who provide insurance in
excess of the lowest cost plan, (2) increased government
spending for preventive health care programs, (3) tort re-
form, (4) paperwork reduction, and (5) holding providers and
insurers "accountable for costs and medical outcomes."(49)
However, the ability of the first four of those cost-control
measures to hold down costs is unproven, and the fifth
sounds suspiciously like price controls.

[Chellyse66]

part 5 Tax Incentives

Tax Incentives

Current federal and state tax laws exclude from taxable
wages the cost of health insurance provided by an employer.
Therefore, the vast majority of Americans, who receive
health insurance through their employers, do not pay feder-
al, state, or Social Security taxes on the value of their
policies. Moreover, the employer can deduct the full premi-
um cost as a business expense. Employers do not even pay
Social Security payroll taxes on health care benefits. In
short, the entire cost of employer-provided insurance is
paid with before-tax dollars.

However, those Americans not fortunate enough to re-
ceive employer-provided health insurance face entirely dif-
ferent tax laws. For example, self-employed individuals and
their families may deduct only 25 percent of the cost of
health insurance. In addition, self-employed individuals
must pay Social Security taxes on money used to purchase
health insurance.

Part-time workers, students, the unemployed, and every-
one else not receiving employer-provided health insurance--
including most employees of small businesses(50)--are unable
to deduct any of the cost of health insurance. (Individuals
may only deduct out-of-pocket medical expenses if they item-
ize deductions and the expenses exceed 7.5 percent of ad-
justed gross income. Fewer than 5 percent of taxpayers are
eligible for that deduction.)(51)

The difference in tax treatment creates a disparity
that effectively doubles the cost of health insurance for
people who must purchase their own. For example, the family
of a self-employed person who earns $35,000 a year and pays
federal and state taxes with only a 25 percent deduction and
Social Security taxes must earn $7,075 to buy a $4,000
health insurance policy. A person who works for a small
business that offers no health insurance would have to earn
$8,214 to pay for a $4,000 policy. Table 2 gives the effec-
tive cost of acquiring a $4,000 policy for each of the em-
ployment groups.



Table 2

Effective Cost of a $4,000 Health Insurance Policy
for Family with Adjusted Gross Income of $35,000
__________________________________________________ ________________

100%
100% 25% Taxed
Tax-Free Tax Deductible Individually
Covered Self-Employed Purchased
Policya Policyb Policyc
($) ($) ($)

__________________________________________________ ____________

Additional earnings
needed to purchase
a $4,000 health
insurance policy 3,716d 7,075 8,214

Less 28% marginal
federal tax rate 0 -1,701e -2,300

Less 8% marginal
state income tax 0 -486e -657

Less payroll taxesf +284 -888g -1,257

__________________________________________________ ______________

aFunds used by an employer to purchase health insurance are
exempt from federal, state, and local income taxes as well as
Social Security taxes.

bSelf-employed workers can deduct 25 percent of their health
insurance costs from federal and state taxable income.

cEmployees who purchase health insurance on their own must pay
for their health insurance with after-tax dollars.

dThough paid for by the employer, the policy is part of an
employee's total compensation package. If employers had to pay
federal, state, and payroll taxes on the value of health insurance
purchased, workers' take-home pay would be reduced by a
corresponding amount.

eThe self-employed may deduct 25 percent of the cost of their
health insurance premiums from their earnings for calculating
federal and state taxes.

fEconomists generally agree that both the employee and
employer shares of payroll taxes represent a tax on a worker's
wages.

gWhile income needed to purchase health insurance by the
self-employed is not exempt from taxes, the self-employed were
able to deduct from their taxable income one-half of their Social
Security taxes, or 7.65 percent, in 1991.



Figure 5

Health Insurance by Tax Status

Status Insured (%) Uninsured (%)

100% Tax-Free
Employer Provided
Coverage 97.2 2.8

25% Tax-Deduction
Self-Employed
Coverage 71.4 26.6

0% Tax-Deduction for
Individuals Purchasing
Insurance on Their Own 32.5 67.5


Source: Employee Benefits Research Institute


The results of the inequity can be clearly seen. Those
workers who must use after-tax dollars to purchase health
insurance are 24 times more likely to be uninsured than are
those who are eligible for tax-free employer-provided cover-
age (Figure 5).(52) Significantly, the poor and minorities,
who are less likely to have employer-provided insurance, are
the most likely to be left without access to health insur-
ance.(53) Thus, the perverse impact of our tax policies is to
give a tax break on the purchase of health insurance to the
most affluent in society and penalize those less well off.(54)

In addition to limiting access to health insurance, our
tax policies also have an adverse impact on health care
prices. By encouraging employer-provided coverage to the
detriment of individually purchased coverage or out-of-pock-
et payment, or both, our tax policy increases the trend to-
ward divorcing the health care consumer from health care
payment. Most health care consumers do not pay for their
health care. On average, for every dollar of health care
services purchased, 76 cents is paid by someone other than
the consumer who purchased it.(55) As a result, consumers
have little incentive to question costs and every incentive
to demand more services.

Some critics argue that health care is not a commodity
that a consumer can shop for like a car or a refrigerator.
Certainly, an individual suffering a heart attack or in-
volved in an automobile accident is not going to comparison
shop for the best price. But less than 15 percent of health
care is emergency in nature.(56) It is possible for consumers
to shop for and compare prices of nonemergency services.
For example, one study found that the cost of cataract sur-
gery in Illinois ranged from $650 to $5,674 depending on the
hospital; the cost of hernia surgery ranged from $404 to
$4,329; and mammograms ranged from $35 to $178.(57) Studies
in Georgia have shown similar variances in price. One study
by the Georgia Department of Human Resources found that the
cost of delivering a baby in different Atlanta hospitals
varied from $1,177 to $3,100.(58)

Currently, most people are not cost conscious about
health care purchases. However, there are numerous studies
that show that health care consumers do make cost-conscious
decisions when given a financial incentive to do so. For
example, the RAND Corporation conducted a study of 5,809
people to determine whether the size of consumers'
copayments had any effect on their health care decision-
making. The study found that an individual with a 50 per-
cent copayment spent 25 percent less on health care than an
individual with no copayment.(59) Studies also show that,
contrary to the assertions of some critics, reduced expendi-
tures are not caused by individuals' forgoing truly neces-
sary health care. Rather, the savings result from reduced
utilization of optional services and cost-based selection
among competing providers.(60)

Tax equity--treating individually purchased insurance
and out-of-pocket health care expenditures the same as em-
ployee-provided benefits--will encourage health care consum-
ers to become more involved in the health care system.
Individuals who purchase their own insurance are more likely
to shop around for the best deal. And individuals who buy
health care out-of-pocket are much more likely to make cost-
conscious health care decisions.

[Chellyse66]

Conclusion

All of the following were taken from the same article and I utilized this to begin the debate. Lastly touched upon were The Heritage Foundation Plan and Medical IRA's I did not open that box because it widen the breadth of the debate. Again I would appreciate each persons input and willingness to share in this debate.
Thanks,
Michele

[Cdn_Psych]

Hi Chellyse66,

Thank you for posting this interesting item.

>HEALTH CARE REFORM: THE GOOD, THE BAD, AND THE UGLY
>by Michael Tanner
>
>Michael Tanner is director of research at the Georgia Public Policy Foundation.


I'd like to address some of the comments in the paper, particularly the single payer section.


>Single-Payer Systems
>
>One of the most dangerous health care reform proposals
>currently being considered is the call for a single-payer,
>government-operated, tax-funded system--the type of system,
>generally referred to as national health care, currently
>operated in Canada, Europe, Australia, New Zealand, and else-
>where.


Dangerous? To whom? To the HMO corporations enriching themselves
by denying care to the ill, that's who!


>The legislation generally cited as the classic example
>of a single-payer health care plan is sponsored by Rep.
>Marty Russo (D-Ill.) and Sen. Paul Wellstone (D-Minn.).
>That legislation specifically establishes health care as an
>entitlement for every American citizen. Every person would
>be issued a national health card. Payment for all medically
>necessary services would be provided through a government-
>operated program, which would be funded by taxes. Benefits
>would include a plethora of medical services, including
>long-term care. The federal government would establish a
>national budget and individual state budgets for operating
>expenses, capital outlays, and medical training. Individual
>hospitals would operate on preset yearly budgets. Physicians
>would be reimbursed on the basis of fees determined by
>the government. The national plan would replace all current
>government programs, including Medicare and Medicaid.
>
>A single-payer national health care system would come
>at enormous cost to American taxpayers. For example, Russo-
>Wellstone would require employers and the self-employed to
>pay a tax equal to 7.5 percent of wages. The top individual
>tax rate would rise from 31 to 38 percent. Corporate income
>taxes would increase from 34 to 38 percent. Social Security
>benefits would be taxed at 85 percent rather than the cur-
>rent 50 percent. And the elderly would be assessed a $55
>per month fee for long-term care.(2) Even those levies may
>not be enough to pay for national health care. Some
>economists put the cost as high as $339 billion per year in
>additional taxes.(3)
>
>For all that tax money, we would buy surprisingly little
>health care.


Sounds alarming. But what does it cost to provide those
same services now in premiums to the HMOs? For some
not-so-hard-to-understand reason, that question is ignored
here.

A casual reader might easily conclude that the $339 billion
estimate given (assuming that figure is realistic, which is
debatable) represents money beyond that currently being
spent. That is misleading at best.

A single-payer system would have the money currently being
paid to corporations (to deny care to the ill) redirected to
taxes to pay for health care. The savings in administration
costs alone would be enormous.


>The one common characteristic of all national
>health care systems is a shortage of services. For
>example, in Great Britain, a country with a population of
>only 55 million, more than 800,000 patients are waiting for
>surgery.(4) In New Zealand, a country with a population of
>just 3 million, the surgery waiting list now exceeds
>50,000.(5) In Sweden the wait for heart x-rays is more than
>11 months. Heart surgery can take an additional 8 months.(6)


I can't speak to these countries and their situations.
However, I note that the original source for much of the
information provided is given as the Fraser Institute.
The Fraser Institute is a "research" group which
continually pushes the corporate agenda. It is not
an unbiased source of information and if you think of it
as a propaganda arm of the corporations, you will understand
why its "research" should not be uncritically accepted.


>In Canada the wait for hip replacement surgery is nearly 10
>months; for a mammogram, 2.5 months; for a pap smear, 5
>months.(7) Surgeons in Canada report that, for heart
>patients, the danger of dying on the waiting list now
>exceeds the danger of dying on the operating table.(8)
>According to Alice Baumgart, president of the Canadian Nurses
>Association, emergency rooms are so overcrowded that patients
>awaiting treatment frequently line the corridors.(9) Table 1
>gives the average wait for various types of physicians'
>services in five Canadian provinces.


Waiting lists here in Canada do exist and they are a serious
problem. However, the suggestion that these are inherently
the result of having a single-payer, tax-funded system is false.

These problems in the Canadian system are the direct result of
massive budget cuts by governments seeking to implement tax cuts
demanded by the right wing and the growth of corporate power.
This has resulted in the elimination of hospital beds and the
layoff of nurses following hospital amalgamations and
"re-engineering" by American consulting companies such as American
Practice Management (APM) and others like it.

The problems in the system which have resulted from the corporate
driven health-care budget cuts are now held out as being the result
of having a publicly funded universal system. The "solution"
offered is privatization of health care.

Here in Ontario, Emergency rooms are crowded because acute care
beds are blocked by patients needing long term care. But the
needed care is not available because hospital downsizing took place
without bothering to open the community based services and long
term care beds needed. And needed surgeries cannot go ahead because
of a severe nursing shortage largely due to nursing layoffs resulting
from "re-engineering".

For an excellent analysis of the situation in Canada, see
http://www.revolutionmag.com/newrev2/canadart.html


>Table 1
>
>Canadian Survey of Physicians: Average Weeks Waited by
>Patients (by Specialty)
>_________________________________________________ _
>________________
>B.C. N.B. Nfl. Man. N.S.
>_________________________________________________ _
>____
>
>Plastic surgery 13.2 36.2 37.0 11.0 26.3
>Gynecology 8.4 10.9 5.3 9.0 9.6
>Ophthalmology 11.6 5.2 2.9 12.8 10.7
>Otolaryngology 12.2 7.2 N/A 7.0 14.7
>General surgery 4.0 2.5 8.0 8.2 4.0
>Neurosurgery 4.2 8.3 9.0 10.5 5.8
>Orthopedic 15.8 14.6 18.5 20.6 19.7
>Cardiology 14.0 10.0 42.6 14.7 26.0
>Urology 8.3 13.2 5.0 6.7 7.1
>Internal medicine 5.5 4.5 2.2 3.3 2.0
>
>_________________________________________________ _
>_____________
>
>Source: Fraser Institute, cited in Reason, March 1992.
^^^^^^^^^^^^^^^^^^^^^^^^

Note the source.


>Sometimes the rationing of care is even more explicit:
>care is denied the elderly or patients whose prognosis is
>poor.


And the HMO doesn't ration care? Who is he trying to kid?


>In Britain kidney dialysis is generally denied patients
>over the age of 55. At least 1,500 Britons die each
>year because of lack of dialysis.(10)


Again, I can't speak to the British situation, but if this
is true, I'd be interested to know what the situation was
prior to the market-driven health care "reforms" that were
instituted by Margaret Thatcher. I wouldn't be at all
surprised to discover that budget cutting played a large
part in this situation.


>Countries with national health care systems also lag
>far behind the United States in the availability of modern
>medical technology. It is well documented that in Canada,
>high-technology medicine is so rare as to be virtually
>unavailable.(11)That comparison holds for other countries as
>well. Advanced medical technology is far more available in
>the United States than in any other nation.(12)


It is true that we do not have as many expensive high-tech
devices in Canada as are in the USA. But do we really need
artificial hearts? Perhaps that money might be better
spent in prevention. Perhaps if our government had not
foolishly extended patent protections for 20 years to the
big drug companies, thereby dramatically driving up drug
costs, we might have more funds available for other things.

I'm not at all certain that spending bazillions on high tech
gadgets is a wise use of health dollars. Better nursing
homes and more long term beds might have a much bigger bang
for the buck. Here in Ontario, the obtuse bully who
declared a few years ago that "Nurses are as obsolete as
hula-hoops" and who is the Premier of the Province, eliminated
the legal requirement that nursing homes had to have at least
one RN on duty at all times. That was just plain stupid
and counterproductive.


>Furthermore, national health care systems do not control
>the rising cost of health care. Proponents of national
>health care make much of reported differences in the
>proportion of gross domestic product spent on health care
>by Canada and the United States. It is true that Canada
>spends only about 9 percent of its GDP on health care,
>while U.S. costs have skyrocketed to more than 14 percent
>of GDP.(14)
>However, such comparisons are seriously misleading.
>
>Between 1967 and 1987 the Canadian GDP grew at nearly
>twice the rate of the U.S. GDP. Therefore, any comparison
>of health spending should be adjusted to compensate for the
>different rates of economic growth. Additional adjustments
>should be made for such factors as population growth;
>general inflation; currency exchange rates; the larger U.S.
>elderly population (the elderly require more, more expensive,
>health care); higher U.S. rates of violent crime, poverty,
>AIDS, and teen pregnancy; and greater U.S. investment in
>research and development. When all such factors are taken
>into account, Canadian health spending is virtually
>identical to that of the United States and has actually been
>rising faster over the last several years.(15) Indeed, Canadian
>public policy experts warn that health care costs are rising
>so rapidly that "they are crowding out every other public
>spending priority--social services, the environment, education.
>All are being shortchanged to feed an inefficiently
>organized health care system."(16)


Ah, the Big Lie of affordability! Here is how the figures
get massaged - see
http://www.rnao.org/Ontario-2001.bud...nder.Final.pdf
for the full document from which this is excerpted:


The Ontario government is calling for greater transparency in
the operation of public institutions. Yet, that transparency
is not evident in the governmentÆs depiction of its own
spending. Consider the announcements made regarding health-care
spending:

- Health care spending has indeed increased at a dramatic pace:
27% in just five years; 19% in the past two years alone. However,
double-digit increases in health care spending are no longer
sustainable.

- To increase spending without improving quality is unwise. To
increase spending well in excess of economic growth is
unsustainable. At the current rate of increase, within five years
health care spending would consume 60% of the Ontario government's
operating budget -- up from 44% today and 38% since our government
was first elected.

- Tony Clement, Ontario Minister of Health and Long-Term Care,
April 24, 2001, House debates, Hansard.

These striking numbers are creative and misleading:

- Intervals are chosen that exaggerate spending trends:

- The 2-year interval chosen picks the catch-up period
following years of severe real per capita cuts.

- In going back 5 years instead of 6 back to the beginning of
its mandate, a low point in health care spending is used,
making the apparent rise sharper.

- Interest payments are omitted from the operating budget,
which inflates health careÆs share.

- Capital spending is ignored (has suffered badly in the past 6 years).

- Ignored above all, is that the total government budget
has plummeted in real per capita terms by 10.6%. Health will loom
larger, if other ministries are squeezed more.

The above points take the official figures at face value.
But when we look more closely, we note that the government also
changed the method of accounting from the cash to the accrual method.
This allows them to claim expenditures when they are announced,
rather than when they are actually made, giving the appearance of
accelerated expenditures. Other creativity with expenditures is
evident in claiming credit for expenditures downloaded to
municipalities (under the Local Services Realignment initiative).
This includes inflation of the health care budget by $94 million
in 1999-2000 and $57 million in 2000-01 for land ambulances;
the province clawed back this money back from municipalities.

Of particular note: the health care budget was inflated
by RESTRUCTURING COSTS that include large expenses to lay off
and then rehire thousands of nurses.

[fergus51]

I have lived in the States and could not go back to that system. I had a terrible personal experience with my insurace company, and a terrible one before that when I was too poor to afford good medical coverage. I personally view health care as a right in a developped country like Canada or the US. With the fabulous economy you have going and the wasted money spent on other things, I think a bigger investment into health care is waranted.

Another reason we have longer waitlists in Canada (other than the RIDICULOUSLY STUPID budget cuts) is that everyone here accesses those services (often too much). I would argue that the uninsured in the US don't go to doctors or hospitals for fear of being unable to pay for the services, thus waitlists are not as long. I know I never did unless it was absolutely mandatory. My grandfather finally had to sell his house when his wife needed care. Seeing something like this happen has made me very aware of the reasons to put off medical treatment.

Yes, the technology and medical professionals in the US are top notch, but I would ask: for whom? For me and my family when we lived in Washington? The answer to that is a resounding no. We weren't worthy of such advanced care.

I don't know what the answer is, but I just don't understand how any country as rich as the US can justify not ensuring that their citizens can go to a doctor when they need to.

I nursed in the US for a few years before moving back to Canada, and while I know there are some serious flaws here but, a lot of them can be adressed. For starters, putting money into prevention would help. Using nurse practitionners as primary care givers is another strategy. Not allowing the elective surgeries that could be treated medically would save a lot of money as well (like the optional hyseterectomies women come in for without even trying to deal with the problem with medication, diet and exercise). Patients here also need to learn not to go to the doctor every time they have the sniffles. Not making more budget cuts to health care is another priority. Our newly elected gov't says it has no more money for nurses, but it has enough to cut provincial taxes.

Any way you look at it citizens aill be paying for health care, either through taxes, to insurance companies or to a conglomerate that will buy insurance for them, and it isn't cheap. I happen to think it is worth it.

[Chellyse66]

That was a good article you quoted out of Revolution magazine
"Underfunded and Under Fire", extremely informative perspective. What I clung to from the onset:
"The storm clouds over Medicare began brewing amid the fiscal crisis in the mid-'70s. In response to inflation, a number of governments and central banks raised interest rates dramatically, forcing recessions and joblessness in many countries.

In Canada, interest rates were set high and inflationary targets were set low, resulting in weak and negative economic growth, and increased budgetary deficits. Joblessness put substantial pressure on social safety nets, draining Ottawa of tax revenue and increasing costs."

In economic terms there are no guarantees, the inflationary targets and joblessness rate wax and wane in the U.S., who is to say that we do not go straight down the indentical path. If a single payor system is initialized that our government does not look to the same solution to the problem and the end result becomes similar.
Now I also found very interesting the reference to NAFTA because this is closer to the truth. For those unaware of NAFTA and FTAA, a brief synopsis; "The Free Trade Area of the Americas (FTAA) is the formal name given to an expansion of NAFTA (the North American Free Trade Agreement) that would include nearly all of the countries in the western hemisphere. This massive NAFTA expansion is currently being negotiated in secret by trade ministers from a total of 34 nations in North, Central and South America and the Caribbean. The goal of the FTAA is to impose the failed NAFTA model of increased privatization and deregulation hemisphere-wide. "
There are many sites on the net to find more information about NAFTA and FTAA. Recently in April 2001 the Summit of the Americas concluded with a declaration which can be found here:
http://www.americascanada.org/events.../declara-e.asp

Lastly information about the Health collaboratives and iniatives from the summit can be found here:
"Health policies at both the national and international levels are mainly designed to improve medical care, social and environmental conditions, and health education. More recently, they have also begun to focus on issues of equitable and affordable access to healthcare, as well as on the reduction of barriers to healthcare services. "

http://www.americascanada.org/politi...h/health-e.asp

This is important as was pointed out in the previous article, allowing for a international standard for physicians to practice globally opens up the market :
"Douglas, national spokesperson for the Canadian Health Coalition, warns that NAFTA will allow companies based in the United States and Mexico to walk in the door, underbid for services and further erode the system.

She cites the example in Ontario, where a U.S.-based home health company won the contract for home health services. "The moment the Americans got the bid, the nurses were out the door and all the new employees were brought in at minimum wage."

As Ralph Nader said of NAFTA's effects during a 1996 nurses union-sponsored tour of British Columbia, "It may start with doctor-run clinics. It's not where it stops. U.S. corporations would like doctors to start these clinics, then buy them out."

Nader warned that U.S. health care corporations are hungry for a chance to get a piece of Canada's health care pie that has been largely off-limits thanks to Medicare.

"The corporate system," said Nader, "can only grow by debilitating Medicare, because it needs more customers, so it disparages your system. It has an endless capital draw, it can bid away doctors from your system, it can undermine political support as it sucks away low-risk, high-income patients until the public system is left as a system for the poor."

Ok now I have slanted the debate so next thread I will again concentrate on a single payor system or universal health care.The FTAA topic could have a thread of it's own. Thank you for the information. I am also glad that you clarified the source of some of the stats in Micheal's article. I hope we can continue this debate and learn more from each other.
Michele Jansen RN