An Enlightened Proposal

One Fact sets the U.S. apart from every other modern nation. Ours is the only country on the planet in which health care is a commercial enterprise and not a social-policy issue. There is no connection between our health delivery systems and public health. The questions of profit and loss ultimately determine how most health care is delivered.

The political assumption that health care is a commodity has produced the irrationality of the current system. In the U.S. the going price for magnetic resonance imaging is approximately $1000. In Japan the price for that procedure is $177. In British Columbia the pre-set fee for removing a gallbladder is $349. In New York City the fee paid by insurance carriers averages $2700. Thanks to these exorbitant fees, some sectors of the medical-industrial complex make stupendous sums of money, while as a country we compare unfavorably with all other developed democracies in categories such as life expectancy, heart disease and infant mortality.

We must closely examine the commercial underpinnings of our health care system. We must require more candor from our political leaders about what needs to be done. They must be aware that we are in the early phases of what may be one of the most historic and beneficial transformations in American society. But it is irresponsible to talk of a quick fix. To say otherwise cripples any hope of reform.

The plan we propose will guarantee access to medical care for all American citizens. It is sweeping in its goals but modest in its timetable. It will take at least until the year 2000 to bring it about, with changes evolving thereafter. But the first and most important element of our plan is the immediate recognition of a timetable based on "all deliberate speed" (to recall another turning point in our history).

In short, our plan closely resembles what in current parlance is called the single-payer system. Once it is put in place, this is what the American health care system might look like, and how it would work:

The ticket to health care would be a simple national health care card that would give all Americans access to all doctors and hospitals. A single entity--call it the National Health Department--would administer the new system. Its personnel and its expertise would come from the medical profession, from private industry, from consumer organizations and from the government. It would reflect a merging of public and private sectors. It would be unique, innovative and helpful--as was the Social Security system when it was established in the Thirties. The new department would be the nation's health insurance company. It would receive all premiums and pay all fees.

With the help of regional boards that would reflect this same expertise, the new authority would set permissible, reasonable rates and assign fixed budgets to hospitals. Rates would be established for everything from a consultation about a headache to a coronary bypass operation. It would endeavor to bring a rational balance to many large hospitals, which contain within their walls some of the cruelest juxtapositions of American health care. For instance, a typical big-city hospital may have highly trained, richly compensated specialists who perform abstruse medical maneuvers, and nothing else, a quick elevator ride away from understaffed emergency rooms that resemble war zones. When the questionable bypass for a wealthy 50-year-old man assumes higher priority than basic care for the masses, something is seriously wrong. The new system would also give more funding to prenatal care and other forms of preventive medicine virtually ignored by the current system. The current system discourages the commonsense checkups that can identify a serious illness. Because such checkups are generally not covered by insurance, our system encourages care only when crises erupt, which is the most expensive approach to health care. Ultimately, preventive medicine is the most powerful controller of costs and the best policy for the health of the country.

But the new authority would not run doctors' offices and hospitals, nor would it dictate where patients should go. Americans would retain their right to choose their physicians, and the medical marketplace would be intensely capitalistic. Doctors would make money only if patients chose to go to them. The only element that would be socialized would be the financing of and payment for services. That same authority would pay doctors and hospitals directly, which is (concluded on page 145) Proposal (continued from page 69) why the system has been dubbed single payer.

A single-payer system benefits the individual, which is why most major economically disinterested consumer groups in the nation support it--including Citizen Action, the Consumer's Union and the Consumer Federation of America.

Where will the money come from? The best way to begin to answer that question is to examine where the money comes from now. Under the current system, employers, employees and private citizens pay health insurance premiums, out-of-pocket payments and federal Medicaid and Medicare taxes. Under the new system, those outlays would be discontinued and replaced with a payroll tax. Just as they do with Social Security, both employers and employees would pay the new tax. With proper management the single-payer system should not cost more than what is currently paid out for health care.

The new system may sound like an expanded Medicaid-Medicare system--with all its incumbent problems--but those problems stem from Medicaid-Medicare's role as the insurer of last resort. Our current system forces federally funded programs to take on only the oldest, poorest and unhealthiest citizens.

There must be other innovations as well. The new authority might greatly expand investment in medical school loans and scholarships. The recipients would pay off the loans by working for a specified time in areas--such as urban ghettos--where the current system has tolerated widespread health problems. Even now, many leading physicians want drastic reforms in medical training and realize that the entire medical profession must take part in the changes affecting all other parts of American life in the Nineties. Now, medical school costs so much that most graduates, whatever their motives for entering medicine may have been, are virtually compelled to choose high-paying specialties.

Like other proposed solutions to the health care mess, our plan has its problems. For example, it necessitates potentially controversial changes in the way health care is delivered and paid for. A single-payer system can be cost-effective only by fixing hospital budgets, capping doctors' rates and controlling patients' access to elaborate medical care and certain elective surgeries. Although our plan would ensure coverage for all citizens, there would inevitably be waits for some kinds of nonemergency care. For Americans who are fully insured under our current system and have virtually unlimited access to care, there will be adjustments. Still, our plan is a rational way to distribute health care to all citizens while keeping costs down.

One way or another, the medical-industrial complex must be reorganized. A recent report by the General Accounting Office, which has acknowledged the enormity of this task, points out that a single-payer system would replace the huge administrative bureaucracies that now must examine claims submitted by millions of Americans who have insurance. Now, employers, employees and private citizens pay for all that red tape. The GAO estimates that nearly $70 billion could be saved every year by using the single-payer system.

The Clinton administration deserves credit for putting the health care crisis at the forefront of the national agenda. The Clinton plan will probably extend health insurance to millions who do not have it. But no matter how the debate shapes and changes the plan's details in the months ahead, it will never be the answer because it gives large insurance companies even more power over health care. If the major insurance companies continue to dominate the health field, the crucial decisions about health care will inevitably be made by administrators whose first responsibility is to help their employers make more money. It will also guarantee differences in quality of care, on how much money a person or employer pays for an insurance package. Underfunded, inhumane care for the poor will continue and our urban emergency rooms will remain the atrocious messes they are today. Inevitably, only by restructuring the system to serve the public need will we be able to solve the health care crisis.

"A single-payer system benefits the individual, which is why most major consumer groups support it."