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Drug and insurance companies spent a combined $2.2 billion lobbying Congress between 1998 and 2007. Pharmaceutical companies and their trade associations spent $1.2 billion, more than any other industry. Insurance companies and their trade associations came in second in lobbying expenditures over the decade, at $978 million. Drug makers dispatch over a thousand agents to lobby congressional committees and administration offices each year. They succeeded in making Medicare Part D a windfall for the drug companies by prohibiting Medicare from negotiating drug prices, and in blocking drug reimportation.
OpenSecrets.com Lobbying Database, 02/ll/08 and Ken Dilanian, Senators Who Weakened Drug Bill Got Millions from Industry, USA Today, 05/14/07
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SINGLE PAYER WOULD SAVE MONEY
Single payer would save money in Colorado, Kansas, New Mexico . Three new fiscal studies of single payer at the state level show that it would be possible to cover everyone and save money on total annual health spending. Savings are projected for Colorado ($1.4 billion), Kansas ($869 million), and New Mexico ($178 million) by the consulting firms of Lewin, Schramm-Raleigh, and Mathematica, respectively. Each firm also evaluated several other options for reform; all cost more for less coverage.
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4.3 TRIL in Year 2017
The Center for Medicare and Medicaid Services estimated in early 2008 that in 2017 health spending will be $4.3 trillion, and the share of health spending by federal and state government's will increase 3 percentage points, from 46% in 2006 to 49% in 2017 (these figures exclude coverage for government employees and tax subsidies to employers, which are often included in PNHP calculations of tax-supported health care). Part of the increased spending by government will be due to an increase in enrollment in private Medicare plans, which cost 12% more than traditional Medicare. (Health Affairs and Kaiser Daily Health Policy Report, 2/26/08).
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US HAS HIGHEST INFANT MORTALITY, LOWEST LIFE EXPECTANCY, COMPARED WITH MORE THAN 20 INDUSTRIALIZED NATIONS
Commission on a High Performance Health System at the Commonwealth Fund examined 37 indicators of health outcomes, quality, access, equity and efficiency developed by the Institute of Medicine, HHS, the Agency for Healthcare Research and Quality, the National Committee for Quality Assurance and other experts.
The US overall scored an average of 66 out of a possible 100 on the health indicators and did not score highest on any of the indicators. The report finds that the US spends twice as much on health care as other industrialized nations in relation to gross domestic product. In addition, the report finds that 61 million US residents lacked health insurance or did not have adequate coverage in 2003
One-third of US patients reported a medical, medication or laboratory error in the past two years. Almost one-fourth of US adults reported that they had to wait at least six days before they received health care. Only 17% of US physicians use electronic health records, which can prevent medical errors and about 115 per 100,000 deaths in the US are preventable with proper health care, compared with 75 in France and 81 in Japan (47% higher than the France/Japan average).
The report states, "If we closed just those gaps that are described in the Scorecard, we could save at least $50 BIL to $100 BIL per year in health care spending and prevent 100,000 to 150,000 deaths," adding, "Moreover, the nation would gain from improved productivity" (Fox, Reuters, 9/20). Cathy Schoen, senior vice president for research at the Commonwealth Fund, said, "We have lives at stake. We should expect higher value in return" for health care spending (Bloomberg/Miami Herald, 9/21).
Look up this Commonwealth Foundation Scorecard Sep 21, 2006 at their website CLICK HERE
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BLUE CROSS SPENDS THE LOWEST PERCENTAGE OF REVENUE ON PATIENTS
Blue Cross of California spent less on medical care last year, as a percentage of its patient revenue, than any other large health plan in California. Blue Cross spent 79% of revenue on healthcare for more than 4.6 million members in 2005, according to the physician group's annual analysis of health plan finances reported to the Department of Managed Health Care, which regulates health maintenance organizations. Of the balance, Blue Cross spent 11% of revenue on overhead and put 10% of it toward profit. The association's leaders criticized Blue Cross' relatively low level of healthcare spending known among insurers as their "medical loss ratio" saying patients would be better served if profit was capped, as overhead expenses are now. "From the perspective of Wall Street, a lower medical loss ratio is great," association Chief Executive Jack Lewin said. "But, from the vantage point of a patient or a doctor or hospital, we look at it as a travesty. We believe more money should be spent on healthcare." State law caps administrative spending by HMOs at 15% of revenue but says nothing about profit levels [EINO: nor about egregious salaries and benefits that might be paid to top executives, which are expressed as costs of administration].
In CA with some of the tightest state regulation here are the five largest medical insurance programs in California ranked by the percentage of revenue spent on medical care as a precentage of income: Kaiser 93.0%, PacifiCare: 86.1%, Health Net 85.7%, Blue Shield 83.4%, Blue Cross 78.9%
For this article By L Girion, LA Times Aug 15, 2006, see LA Times archives of the data it was based on from the California Medical Assn.
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NATIONAL HEALTH CARE? WE’RE HALFWAY THERE
Out of a total population of about 300 million, 35.6 million elderly Americans were on Medicare in 2005. Of the working-age population, which reached 257.8 million in 2005, some 45.5 million were covered by Medicare, Medicaid or military health programs. An additional 18.2 million workers had health insurance through jobs in the public sector. Millions of those workers’ dependents are covered as well. Even if those dependents are not included in the tally, taxpayers paid the bill for almost two- fifths of all Americans with insurance in 2005.
But that’s not the full extent of government and taxpayer involvement. Employer-provided health insurance premiums are a form of compensation, yet are not subject to federal payroll or income taxes and are exempt from many state and local taxes. Economists consider these exemptions a form of subsidy. TM Selden, economist at the federal AHRQ, estimates that the tax subsidy for employment-related coverage at $208.6 BIL in 2006, or 35.4 % of the amount spent on premiums.
Mining data from the National Health Expenditures Accounts, Mr. Selden found that public expenditures on health care including: Medicare, Medicaid, military health care and federal employee benefits accounted for $888 BIL of the $1.96 trillion spent on health care in 2004. Adding in the aforementioned subsidies, and premiums paid for public-sector employees, the total comes to $1.2 trillion, or 61%.
Uwe E. Reinhardt, the James Madison professor of political economy at Princeton, suggests adding 5% for the federal mandate that hospitals provide free health care to the uninsured. So government accounts for about two-thirds of health care spending. A rough rule holds that private insurance covers two-thirds of the population and pays for only one-third of all health care,Mr. Reinhardt said.
The government spends money as if there were a national health insurance program. In 2004, government spending on health care equaled 9.6 % of the gross domestic product, compared with 6.9 % in Canada, which has a single-payer universal health care program, said David Himmelstein, associate professor of medicine at Harvard Medical School. "We’re paying for national health insurance, but we’re not getting it," Dr. Himmelstein added.
For the landmark Health Affairs article by Steffie Woolhandler and David Himmelstein, "Paying for national health insurance--and not getting it":CLICK HERE
and for the NYTimes Your money viewpoint CLICK HERE
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HEALTH
CARE REFORM WOULD PRODUCE HUGE SAVINGS
National Coalition on Health Care Press Release of May 23, 2005
System-wide health care reform would save much more money than it would
cost, according to economic projections released today by the National
Coalition on Health Care. In four scenarios for reform analyzed by Professor Kenneth Thorpe of Emory
University, the investment needed to achieve universal health coverage
would be more than offset by savings. In each case, the cost of a reformed
system would be much less than the cost of continuing with the current
system. [So why are we willing to pay twice what other nations pay? Maybe
for the privelege to be the one industrialized which shuts out a third of our
people from needed coverage every year, including those uninsured for part of
each year and the underinsured.]
Total change in spending for years 2006 through 2015 under four scenarios
(in comparison with the status quo):
$320 BIL reduction - Employer mandate supplemented by individual mandate
$320 BIL Reduction - Expand existing programs to expand coverage
$370 BIL reduction - Develop new program modeled after the FEHB
(federal employees' program)
$1.14 TRIL reduction - Universal publicly financed
program ("single payer")
Look for this press release at the NCHC website CLICK HERE
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HEALTH SPENDING PROJECTIONS THROUGH 2015: from Health Affairs of Feb 22, 2006
Health Cost Projections for 2006 are
$2.2 TRIL - National health expenditures (NHE), $7,110 - NHE per capita, 16.5% - NHE as percent of GDP
Health spending is expected to consistently outpace gross domestic product (GDP) over the coming decade, accounting for 20% of GDP by 2015. Stable trends through 2015 likely mask important changes to the US health care system across payers and types of care.
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45.6% of all bankruptcies involve a medical reason or large medical debt
326,441 families identified illness/injury as the main reason for bankruptcy in
the U.S. in 1999. An additional 269,757 had large medical debts at time of bankruptcy 7 per
1000 single women, and 5 per 1000 men suffered medical-related bankruptcy in
1999. So UHC would cause bankruptcy?
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Who is Contributing to Care?
Increases In Registered Nurses Vs. Administrators
Physician Growth vs. Administrators appeares identical
From Bureau of Labor Statistics and Data from Center for Policy Studies
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Clearly, there are enormous benefits to having a for-profit health care system (1998 data). It's just that these are benefits accruing only to a handful of great American patriots while the oversee a system of broad and intensive suffering. See also 2005 stock options of McGuire in 2005.
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Medicare overhead is estimated between 2 and 3 % of total net expenditure. Here you see the major sources of the wasteful U
S "system" for providing health care.
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ELDERLY POPULATION AS A PERCENT OF TOTAL, BY NATION
Is our failing system really due to having fewer workers to support each elderly retired worker?
From Health Affairs 2000 Vol 19(3):192
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HEALTH CARE COSTS IN THE USA AND IN CANADA AS PERCENTAGE OF GDP
US waste is shocking, keeping in mind how many Americans are excluded from care and how many suffer with partial and inadequate care. Canada was once on a par with USA. How are we going to compete in the strict business sense?
From Canadian Inst for Health Info & NCHS/ US Commerce Dept
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OVERALL ADMINISTRATIVE COSTS IN USA AND CANADA FOR HEALTH CARE
Americans pay 3.5 times more for administration of services and treatments (not for patient care itself). Considering that one in three non-elderly American adults are without any health coverage at all, the administration of care for those who have care administered is even far more (nearly 5-fold) in excess of the Canadian rate.
Source NEJM 2003 379:768
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HOSPITAL BILLING AND ADMINISTRATION, USA & CANADA
The figures shown are per capita costs for everyone in the country for 2003. The per capita cost is almost seven times greater in the USA. This is a very appropriate way to express this data, because the cost of a nation’s hospitals are a necessary national expense needed to maintain a system for everyone in the country (anyone who might be needing next week or next month). The same comparison USA to Canada of costs for physician administration and billing is just a 3-fold difference. Wow, that's great isn't it we're only paying three times as much per capita for the billing process at the clinics!
From NEJM 2003 349:768
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HEALTH PLAN COSTS COME UNDER FIRE
L Girion
California Insurance Commissioner John Garamendi singled out Blue Cross of California for criticism, noting that its profit margins on certain insurance plans rose from about 15% to 24% in recent years. The company's trend on healthcare spending was just the opposite - declining from 80% of premiums in 2000 to 68% last year. "It's unconscionable," Garamendi said.
Some of the company's fastest growing - and most profitable - plans are new ones that offer low premiums in exchange for high deductibles or limited benefits. The most controversial among them is a plan called Tonik. Aimed at young adults who are generally healthy, Tonik does not even cover maternity benefits. Garamendi said such plans amounted to "cherry-picking," or orienting coverage to attract healthy members, who are cheaper to underwrite [EINO: Hello-o-o-o. Isn't that what insurance companies exist?].
"They are looking to find individuals that do not get sick," Garamendi said in an interview. The plans "are all designed to appeal to people who don't need medical services. That increases their bottom-line profit." BC regional VP that such plans "were aimed at people who hadn't previously bought health insurance because they couldn't afford it or viewed it as too expensive. The plans' popularity, if we were offering a product that people didn't like, they don't have to buy it" she said. [Essentially, agreeing with EINO: Hey that's what we're here for!]
Los Angeles Times. December 2, 2005. The article may still be available at: CLICK HERE
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This was restated (in almost exactly these same words) by Paul Krugman in an article in the NYT of Nov 7, 2005. He refered to the article in the journal "Health Affairs" published in 2003 and cited here .
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US PROJECTED TO SPEND $3.8 TRIL AND 19% OF GDP ON HEALTH CARE IN 2015
Official CMS estimates that national health spending will increase from $2.1 trillion in 2006 to $3.8 trillion (19 % of GDP) in 2015 in the absence of reform.
"National Health Spending in 2004," Health Affiars 25(1); January/February 2006 by Smith, C. et al
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22% of PREMIUMS SPENT ON OVERHEAD
In 2005, UnitedHealth spent only 78.2% of the health care premiums it collected on benefits; 21.8 % went to overhead.
Foundation for Consumer and Taxpayer Rights Press Release, 01/19/05 and Kaiser Policy Report, 10/18/05
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UnitedHealth PANEL MAY FACE SCRUTINY
By Joshua Freed
The huge paydays for UnitedHealth Group Inc. Chairman and CEO William McGuire grabbed attention last week - but that could soon be turning to the people who signed off on his pay package. Most companies, including UnitedHealth, have compensation committees made up of a few directors who set pay for executives. McGuire's $1.6 BIL in unexercised stock options have some people wondering whether UnitedHealth's three-member compensation committee was doing its job.
The timing of McGuire's stock options, when UnitedHealth stock was at its lowest so he would benefit as much as possible, raised the possibility that they had been backdated. Compensation consultant Paul R. Dorf, of Compensation Resources Inc., called backdating options "highly unethical, if not illegal."
UnitedHealth Group's medical loss ratio for 2005 was 78.6%. That means that UnitedHealth retained for its own intrinsic uses, including profits, 21.4% of premiums paid. Profit for 2005 was $3.3 BIL. For that performance, CEO McGuire receives $1.6 billion in unexercised stock options. One individual received fully half the profit (and that's just his stock options, not salary, retirement other benefits). Why did you say the USA cannot afford universal health care like every other industrialized nation on earth?
This article is from SFGate.com of April 23, 2006 and may still be available at
CLICK HERE
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BUILDING BLOCKS FOR REFORM: ACHIEVING UNIVERSAL COVERAGE WITH PRIVATE AND PUBLIC GROUP HEALTH INSURANCE Commonwealth Fund May 13, 2008 Cathy Schoen, M.S., Karen Davis, Ph.D., Sara R. Collins, Ph.D. Health Affairs, May/June 2008
The "Building Blocks" framework proposed by the Commonwealth Foundation in June 2008 continued the private, public current mix of insurances and involves a mandate to the public for buying into the "insurance connector" if not otherwise covered (through employer, for example) all residents would be required to provide evidence of coverage when filing their taxes. Individuals without coverage and incomes in excess of 150% of the poverty level would be automatically enrolled. Even a national plan such as this would have had a "minor effect" on national health spending, while covering ALL AMERICANS. Still without a commitment to the ideal of having all Americans insured for their health needs, this opportunity was passed as we entered the severe recession. National health insurance would have yielded a large net savings, and still could by substantially reducing administrative overhead.
http://www.commonwealthfund.org/publications/publications_show.htm?doc_id=685132
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TAX SUBSIDIES FOR HEALTH INSURANCE
Most workers pay both federal and state taxes for wages paid to them by their employers. If, however, their employer also contributes to the cost of a health insurance plan, these funds are usually excluded from taxable income. In fact, almost 160 million non-elderly people in the USA obtain health insurance through an employer in large part because the tax system subsidizes the purchase of employer-sponsored health insurance (ESI).
The largest tax subsidy for private health insurance -- federal exclusion from income and payroll taxes of employer and employee contributions for employer-sponsored health insurance -- was estimated to cost the U.S. Treasury around $200 BIL in lost revenue in 2007, one-half, or more, of the estimated net federal outlays for the Medicare program for that year. Other prominent tax subsidies for private health insurance include the exclusion of health insurance premiums from state income taxes, the federal tax deduction for the self-employed, and the health care deduction for health expenses exceeding 7.5% of adjusted gross income. Understanding the substantial tax advantages provided for ESI, particularly for families at relatively high incomes, may help provide perspective on the appropriate tax credit level for lower-income families. [EINO: This subsidy also needs to be appreciated to understand the full cost of the current system. It is typically excluded from official reports of what the US spends on health care.]
TAX SUBSIDIES FOR HEALTH INSURANCE Prepared by the Kaiser Family Foundation July 2008 Original Article
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MEDICARE PART D: DRUG PRICING AND MANUFACTURER WINDFALLS
Just looking at pharmaceutical costs, taxpayers would save $156 BIL annually if negotiated Medicaid prices were paid for all Medicare beneficiaries instead of the Medicare D un-negotiated gift prices mandated by Bush Admin. Meanwhile an August 2008 Kaiser study estimated that covering all of the uninsured in the country with our current -otherwise unimproved wasteful system- would cost the nation only $123 BIL a year considering how much is already spent to prop up hospital income due to "uncompensated care" for the uninsured, a whopping 21% less than extending insurance.
Private Medicare Part D insurers pay significantly higher prices for prescription drugs than does the Medicaid program. In the case of the six million dual eligible beneficiaries, the Medicare Part D insurers paid $3.7 BIL more in 2006 and 2007 to purchase the top 100 drugs for dual eligible beneficiaries than they would have paid if they had access to the lower Medicaid drug prices. This increase in costs represents a windfall to drug manufacturers. Eliminating the drug manufacturer windfall would realize substantial savings to federal taxpayers. Over the next ten years, taxpayers would save $86 billion if the Medicare Part D insurers paid Medicaid prices for drugs used by the dual eligible beneficiaries. If Medicare negotiated directly with drug manufacturers and obtained prices equivalent to the Medicaid prices for all Medicare beneficiaries, the potential savings to taxpayers increases to $156 billion.
MEDICARE PART D: DRUG PRICING AND MANUFACTURER WINDFALLS USA House of Representatives Committee on Oversight and Government Reform July 2008 By the Majority Staff Original Article
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REDUCING PREVENTABLE DEATHS THROUGH IMPROVED HEALTH SYSTEM PERFORMANCE
Research shows that the US is not reducing its rate of "mortality amenable to health care" as quickly as other industrialized nations. In fact, in a recent study, the US came in last among developed countries on this measure, which includes only deaths under age 75 and excludes deaths that are likely not preventable. Other studies reveal declines in the US in life expectancy, as well as rises in infant mortality rates. Poor performance on these measures points, in large part, to flawed preventive care--instances where the health system has failed to identify underlying conditions that can lead to potentially fatal diseases, or failed to help people with chronic disease stay as healthy as possible. For example, Fund research has found that, as of 2005, adults in the U.S. received only half of the recommended screening and preventive care for their age group.
These data underscore the need for health care reform, to ensure that all Americans have excellent access to excellent care. The Commission's key strategies for achieving broad performance improvement include: extending affordable health insurance to all; aligning financial incentives to enhance value and achieve savings; organizing the health care system around the patient to ensure that care is accessible and coordinated; meeting and raising benchmarks for high-quality, accessible care; and ensuring accountable national leadership and public/private collaboration.
REDUCING PREVENTABLE DEATHS THROUGH IMPROVED HEALTH SYSTEM PERFORMANCE The Commonwealth Fund
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Per capita spending
on health
In several countries (all with UHC except the
USA)
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*4 Public Citizen's Health Research Group
THE COST (OF HEALTH CARE ADMINISTRATION) TO THE NATION, THE STATES AND THE DISTRICT OF COLUMBIA, WITH STATE-SPECIFIC ESTIMATES OF POTENTIAL SAVINGS By Himmelstein, Woolhandler, and
Wolfe See their summary.
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*5 see article in the nation |
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*6 see articles in the nation and at Chrysler website |
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Trader Joe's and Whole Foods, have a healthcare crisis on their hands. In 1999, Giant and Safeway paid $112 million in medical costs for employees in the Washington, DC region; by 2003, they were spending $180 million on healthcare subsidies. These rising costs, and the chains' efforts to slash workers' subsidies, recently prompted 70,000 California grocery workers to go on strike. Desperately looking for ways to stay competitive, the supermarket chains could find their salvation in a single-payer system. (From the same article in the nation) |
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The CEO of Kadant Inc recently told the Washington Post that healthcare costs make operating in the US nearly unsustainable. Kadant says it will spend $6,500 on health care in 2004 for each of its American employees. But, the single-payer system in Canada is so inexpensive that Kadant is considering moving all its operations north of the border.nd |
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*7 The New York Times, November 27, 2004, "This Year, Ontario May Pass Michigan in Making Vehicles" By Danny Hakim
Michigan has been the heart of the auto industry since Henry Ford started mass-producing the Model T a century ago, but the Midwestern state is poised to be surpassed by Ontario. The Canadian province is on course to pass Michigan this year and become the biggest auto-producing state or province in North America, according to Ward's Automotive, which tracks auto production data.
Canada is attractive, in part, because of its nationalized health care system, which negates perhaps the largest competitive burden faced by domestic manufacturers. G.M. spends roughly $1,400 a vehicle produced in the United States on health care, more than it spends on steel.
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Ref-1 "Health Costs Absorb One-Quarter of Economic Growth, 2000-2005,"
Boston University, D. Socolar and A. Sager . CLICK HERE
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REFERENCES
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