In Part 1 of his 3-part ‘Real News’ interview, Gerald Friedman, a professor of economics at the University of Massachusetts in Amherst, explains how a single-payer plan in Maryland would cover everyone, improve outcomes and make business more competitive:
from the transcript:
PAUL JAY: So before we dig into some of your research, just sort of give us the bigger picture of why this would make sense for Maryland.
GERALD FRIEDMAN: Well, the big picture is that health insurance provided by competing private companies is inherently inefficient and destructive of people’s health. I mean, that’s a strong statement, but I think it is well founded.
The problem with private health insurance is that it’s not like selling shoes. If you’re a shoe company, you want to sell more shoes, you want to make a better quality shoe at a better price to attract more business. Health insurers don’t want more business. They want to get rid of sick people. Eighty percent of your costs as a health insurer are incurred for about 20 percent of your people. You know, in some places it’s 90-10—90 percent of your costs go to 10 percent of the people. If you can find those people, identify those people, and figure out a way to get them to go away, go to a different company, then you will be in a position to lower your prices and increase your profits. That is what health insurers try to do.
In Part 2, Gerald Friedman explains how a single-payer plan in Maryland would cover everyone, improve outcomes and make business more competitive:
from the transcript:
PAUL JAY: So let’s dig in into your study and what you found. So you have a section on savings, and point one is administrative costs. So explain what you found there.
GERALD FRIEDMAN: Okay. Well, first of all, there are the administrative costs of the health insurers themselves, who devote a great deal of energy and resources to, first, screening people and supervising what doctors do in order to drive away people who will need extensive care.
The average health insurer in Maryland has what they call a medical loss ratio of 85 percent. Now, the medical loss ratio is the proportion of health insurance premiums that are actually paid out to provide the health care. In Medicare, the medical loss ratio is 98 percent.
Wall Street doesn’t like high medical loss ratios. To them, to Wall Street, a high medical loss ratio means that you have too many sick people, you’re not running enough profit. They like the medical loss ratios to be low. We, the consumers of health care, normal people, we like a high medical loss ratio. We want the money we put into the insurance plan to be paid out in benefits.
And in Part 3, Gerald Friedman details how to pay for single payer health insurance:
from the transcript:
PAUL JAY: Alright. So in the last segment, we went through your report and we looked at the savings, which came to just over 24 percent over existing insurance coverage and health care expenditure. But that doesn’t cover everything, does it? And then so what isn’t paid for out of these cost savings, and how are you going to pay for it?
GERALD FRIEDMAN: Okay. Well, first of all, the cost savings are there. There are also extra expenses, as we were saying, with the Medicaid rate fix. Also, we would be covering everybody. Now 15 percent of the population of Maryland is currently without health insurance. Extend health insurance to them, they’re extra expenses. Also, the plan for the Maryland Health Security Act does away with copayments, deductibles, and all of those expenses. We expect that people would use health services more.
A Long Beach hospital charged Jo Ann Snyder $6,707 for a CT scan of her abdomen and pelvis after colon surgery. But because she had health insurance with Blue Shield of California, her share was much less: $2,336. Then Snyder tripped across one of the little-known secrets of healthcare: If she hadn’t used her insurance, her bill would have been even lower, just $1,054. “I couldn’t believe it,” said Snyder, a 57-year-old hair salon manager. “I was really upset that I got charged so much and Blue Shield allowed that. You expect them to work harder for you and negotiate a better deal.”
Unknown to most consumers, many hospitals and physicians offer steep discounts for cash-paying patients regardless of income. But there’s a catch: Typically you can get the lowest price only if you don’t use your health insurance. That disparity in pricing is coming under fire from people like Snyder, who say it’s unfair for patients who pay hefty insurance premiums and deductibles to be penalized with higher rates for treatment. The difference in price can be stunning. Los Alamitos Medical Center, for instance, lists a CT scan of the abdomen on a state website for $4,423. Blue Shield says its negotiated rate at the hospital is about $2,400. When The Times called for a cash price, the hospital said it was $250.
“It frustrates people because there’s no correlation between what things cost and what is charged,” said Paul Keckley, executive director of the Deloitte Center for Health Solutions, a research arm of the accounting firm. “It changes the game when healthcare’s secrets aren’t so secret.” Snyder’s experience is hardly unique. In addition to Los Alamitos, The Times contacted seven other hospitals across Southern California, and nearly all had similar disparities between what a patient would pay through an insurer and the cash price offered for a common CT, or computed tomography, scan, which provides a more detailed image than an X-ray.
I rolled my eyes when I read Mrs. Snyder’s comments. Not that I disagreed with her expectations about health-care costs. But Blue Shield and the rest in the AHIP cartel don’t care about the price American’s pay. They care how to make the most money they can and if that means screwing the public that’s what will happen.
From MedPage Today:
Enrolling patients in Medicaid increases their use of healthcare services, but doing so reduces financial strain on these impoverished patients and improves their sense of well-being, according to the first randomized study to compare the uninsured with the insured in the U.S.
In a novel program in Oregon, previously uninsured individuals chosen by lottery to be eligible for Medicaid experienced a 35% increase in their likelihood of having outpatient care, according to Amy Finkelstein, PhD, of the Massachusetts Institute of Technology, and colleagues.
Enrollees also had a 15% increase in prescription drug use and a 30% increase in hospital admissions, the researchers reported in a working paper published on the website of the National Bureau of Economic Research.
Being insured also was beneficial in alleviating financial strains.
For instance, participants were 25% less likely to have an outstanding medical bill sent to a collection agency — a finding that also benefits healthcare providers, according to the researchers — because most medical debts remain unpaid over the long term.
Other financial effects were a 35% decrease in the likelihood of patients’ incurring out-of-pocket expenses and a 40% decrease in the need to borrow money or avoid paying other bills for medical fees.
One more reason we need single payer, at the least as an alternative to private insurance and as a last resort for people who can’t get insurance. And one more reason to re-tax the wealthiest: surely improving the lives of the poor is at least as important as letting multi-millionaires on up have one more dollar. The difference between earning one dollar a year and earning a million a year is vast but the difference between earning ten million and fifty million is marginal.
Nancy Pelosi a week or two ago on the House floor in response to the Republicans pushing to end Medicare:
This is intended as a follow on to The Big Hurt’s posts about Democrats failing (here, here, here, here). Well this is what a real Democrat sounds like, even if Pelosi is the subject of one of The Big Hurt’s posts (and rightly so, in that case). Indeed, Pelosi for President in 2012. Or someone like her with the rhetoric and the proven ability to get things done in Washington.
Pelosi is not afraid, in public, to call a spade a spade. Especially about 3 minutes into this video. We would have a healthy political culture if her views were heard at least as much as views from the other side, for example, Senator Durbin.