Tag Archives: British Health Care

Is a Single-Payer HealthCare System Viable in the United States?

IRS and Healthcare

As we discuss the goods, the bads and the uglies and possible failures of the Affordable Care Act (ACA), there is a fallback discussion of a Government-run, single health care system is back in vogue. It seems to be the fallback strategy if the ACA fails. The Senate had a series of hearings a few weeks ago on the single-payer systems of other countries. They had no problems in finding witnesses touting their supposed benefits. But let us look carefully at the reality of the single-payer health care system. Some states are already pushing for a single-payer replacement for the ACA such as Vermont and Hawaii. They as well as proposals from New York, California, Pennsylvania, Minnesota and Colorado offer up single-payer systems within their borders to replace their state’s failing exchanges.

The single-payer proponents cite the Canadian health care system as an example as proof of a superior system. Sally Pipes of the Pacific Research Institute, on Wednesday, April 23, 2014 wrote an article reviewing this statement. She is a native of Canada and from her first-hand observation points to the reality of the plague of poor quality care, long waits, rationing, scarcities of vital medical technologies as well as unsustainable costs. “To keep a lid on healthcare costs, Canadian officials ration care. As a result, the average Canadian has to wait four-and-a-half months between getting a referral from his primary care physician to a specialist for elective medical treatment — and actually receiving it.”

It is interesting that in Boston, their patients face the longest wait times for an appointment in America, according to Merritt Hawkins, a consulting group evaluating health care. Remember that Massachusetts was the first state essentially enacting an adaption of the ACA in 2006, four years before it went national as part of their own affordable care system. Compare this, where the average wait time in Boston is 45.4 days, which is about three months less than in Canada.

We think that the definition of “elective treatment” refers to facelifts, Botox or tummy tucks. However, in Canada the elective type of treatment actually refers to life-or-death procedures like neurosurgery, orthopedic and cardiovascular surgery.

Consider that these wait times are only growing longer and longer. The average 18-month wait time in Canada today is 91% longer than in 1993.

I also mentioned that Canada has a severe shortage of essential medical equipment. Canada ranks 14th among 22 Organization for Economic Co-operation and Development (OECD) countries in MRI machines per million people, with an average wait time to use one at just over eight weeks. The United States, by contrast, ranks second in medical technology.

Canada ranks a dismal 16th of 23 OECD countries in CT scanners per million people, with an average wait time of over 3.6 weeks. The United States ranks fifth in comparison.

Every Canadian is technically “guaranteed” access to health care. But long waits and the scarcity of medical technologies leave many untreated.

When people aren’t treated in a timely fashion, their conditions worsen, and they often end up requiring significantly more expensive and extensive treatments.

The Center for Spatial Economics, a Canadian research organization, estimates that wait times for just four key procedures — MRI scans and surgeries for joint replacement, cataracts, and coronary artery bypass grafts — cost Canadian patients $14.8 billion every year in excess medical costs and lost productivity. Also realize that most of the advanced cardiac surgical procedures are performed in the US due to wait times and lack of up-to-date technologies.

Once Canadian patients finally receive treatment, it’s far from “free.” Their government levies heavy taxes to pay for the system. According to Nadeem Esmail, a scholar at the Fraser Institute, a Canadian think tank, “Some 68 per cent of personal income taxes paid in aggregate are required to cover the cost of Canada’s taxpayer-funded health care program.”

Patients may only have to pay a nominal fee when services are rendered. But the typical Canadian family pays about $11,300 in taxes every year to finance the public insurance system. The same is true in other countries with a single payer system such as the Scandinavia, where the income tax is 64% and in the British Isles where the Value Added Tax is about to raised fro 17% to 27% to fund their increasingly more expensive health care systems.

Vermont is experiencing this high-tax reality firsthand, as it prepares its single-payer system. One Democratic state representative has admitted that the system will “cost more” than the initial estimate of between $1.6 billion and $2.2 billion annually. Avalere Health, a consultancy, estimates that Vermont will have to essentially double its tax revenue to pay for the system.

Because of the low quality of care and long waits in their home country, an enormous number of Canadians travel to the United States to receive medical attention. In 2012, over 42,000 crossed the border to do just that.

Many of these border-jumpers are part of Canada’s political elite. The national healthcare system may be good enough for their constituents, but it’s apparently not good enough for them. Does this sound familiar?

Former Member of Parliament Belinda Stronach spent her career vigorously opposing privatization of the national health system. But when she was diagnosed with breast cancer in 2007, she flew to Los Angeles for surgery.

In 2010, the premier of Newfoundland flew to Florida for heart valve surgery. When questioned about the decision, he said, “This was my heart, my choice and my health.”

Millions of ordinary Canadians would surely love to have that option of utilizing the best specialists in the world.

Canadians know their system isn’t all it’s cracked up to be. Anne Doig, former head of the Canadian Medical Association, has called the system “sick” and “imploding.” Dr. Brian Day, an orthopedic surgeon in Vancouver who runs the private Cambie Clinic has quipped that Canada is a country where a dog can get a hip replacement in less than a week — but his owner would have to wait two years.

Canada’s single-payer system isn’t one America should long for — it’s one we should strenuously avoid.

There was an interesting article in the Financial Times by Janan Ganish, announcing the new chief executive for England’s “troubled” National Health Service. The new chief executive, Simon Stevens, who served the former Prime Minister Tony Blair, spent the last six years in the U.S. running United Health Group, a major insurance company that serves more customers than the population of the U.K. He believes in market inspired techniques such as competition and in using data on costs, doctor performance, and treatment effectiveness to “empower patients and reduce waste.”

Chris Smyth in The Times comments, saying that, according to a new report y the King’s Fund health foundation, that “we can either continue with a “failing system” of rationed, sometimes substandard care, or increase funding through higher taxes or charges for doctor’s appointments and emergency room visits-i.e. the increase VAT, co-payments and or raising the cost of prescription drugs. So how good is this example of “free” health care????

Again, I warn the U.S. and especially the “educated voters”, be careful what you wish for! Based on the other health care systems being used by the countries that we think are better than our old and present health care system-they are not better. That is unless we want to suffer the plague of poor quality care, long waits, rationing, scarcities of vital medical technologies as well as unsustainable costs. Wake up, it is already happening!

To learn more about the Canadian health care system read Sally C. Pipes the President, CEO, and Taube Fellow in Health Care Studies at the Pacific Research Institute. Her latest book is “The Cure for Obamacare” (Encounter 2013).

Myth of Health Care Charity

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First, before I initiate a discussion regarding charitable health care, let me question the intelligence of voters in the State of Maryland. I already discussed weeks ago regarding the horrendous roll out of the Maryland healthcare system under the Affordable Care Act (ACA). Who was responsible? The Lieutenant Governor of the State of Maryland, Anthony Brown was responsible and he botched up the roll out eventually costing the taxpayers of Maryland about $200 million. However, the campaigning lies are promoting the wonderful job that he did regarding the ACA. The latest TV ad suggests that he did so much, especially for the aged/seniors. Those that know anything and have minimal intelligence, probably the minority of voters, realize that the seniors/aged are covered by Medicare and have very little to do with the roll out of the ACA. So, as I have said multiple times, wake up America, wake up Marylanders!!

Now on to our Sunday evening discussion.

Anne Zieger reported that in an effort to force patients to buy policies through the ACA health insurance exchanges, hospital systems around the country have started cutting back on financial help for lower- and middle-income people who don’t have health insurance. They are assuming that these families can afford the health insurance plans offered on the exchange, but have declined to make the investment.

While the number of systems that are taking this tack seems limited so far, many hospitals and health systems are considering a “get tough” approach to charity care, and experts predict that that more restrictive policies will become increasingly common, according to the piece in The New York Times. The State of Maryland is different because has waivers for uncompensated care as well as a TPR or total payment system.

One example that stood out in the Times piece comes from St. Louis, where Barnes-Jewish Hospital has started charging copayments to uninsured patients, no matter how little money they’ve got. Another example comes from the Southern New Hampshire Medical Center in Nashua, which no longer provides free care for most uninsured patients above the federal poverty line of $11,670 for an individual. Yet another hospital taking a stricter approach to the uninsured is Burlington, VT-based Fletcher Allen Health Care, which has cut back on financial aid for uninsured patients who earn between twice and four times the poverty level, the Times piece notes.

Unfortunately, these providers’ assumptions about patients’ ability to pay are incorrect. Those at or near the poverty line may not be able to afford even heavily-subsidized policies, and the middle class — who get little or no subsidies — often find that the hundreds of dollars a month they are expected to pay is far beyond their reach

The open but little-discussed secret to the health exchanges is that they really haven’t made health care that affordable after all. In Virginia, for example, the cheapest policies are approximately $350 per person with a $4,000 deductible and a 20% coinsurance requirement. Not only is that a sizable premium level even for middle-class family, the deductibles and coinsurance requirements reduce the value of such a policy dramatically, as low- and middle-income families are seldom equipped to meet such deductibles and coinsurance requirements. Here in Maryland we are seeing deductible as large as $5,000-$7,500 with insurance premiums rising by 42-50 percent. Therefore, they now have catastrophic care insurance policies. Who is winning in this scenario? Not the insurance companies! No, once again, as I have previously pointed out, it is the middle class working tax paying person who is footing the bill for the ACA and who suffer the most.

Health systems are continuing under this assumption as though this were a reasonable option, and that the less prosperous patients are simply being intransigent. “Do we allow our charity care programs to kick in if people are unwilling to sign up?” Nancy Schlichting, chief executive of the Henry Ford Health System in Detroit, asked the Times. “Our inclination is to say we will not, because it just seems that that defeats the purpose of what the Affordable Care Act has put in place.” 

Another hospital, Southern New Hampshire Medical Center, had previously provided free or discounted care for patients who were at or below 225% of the poverty level, or about $26,260 for an individual. Now, however, patients who “refuse to purchase federally mandated health insurance when they are eligible to do so will not be awarded charitable care,” the hospital’s new policy states. Notice the use of the word “refuse” — it implies a lot that’s simply not true about the uninsured.

Ultimately, all of this posturing is in vain, and merely punishes lower-income patients to no avail. If hospitals hope to save money by cutting back on charity care, they’re probably out of luck. If a family can’t afford premiums on the health exchange, they aren’t going to be able to pay massive hospital bills either.  Depriving them of charity care won’t magically force them to take on a larger percentage of their hospital bill, it will simply increase the level of bad debt a hospital must account for, and what’s more, makes it more likely that frightened consumers won’t come in to the hospital for help when it’s needed.

It’s understandable that hospitals want to see the health exchanges work, and want to see as many lower income people buying policies on the exchanges as possible. After all, that does give them a shot at reducing their bad debt.  But if they really want to deal only with insured patients, it’s time they gear up campaigns to subsidize health exchange premiums through thirdparty payers, a strategy that actually has a chance of working. Taking a position that tries to force the poor to produce premium funds out of thin air is just plain wrong.

But also, expecting the middle class to shoulder the high premiums as well as having to deal with extreme deductibles makes no sense. We, as physicians, are already seeing patients cancel their office visits, surgery and routine diagnostic tests, which can and will lead to poor care and delayed diagnosis of diseases. Therefore, they delay treatment leading to more extensive surgical procedures, additional chemotherapy and or radiation with threat of recurrence of disease, cancers and additional treatment.

A recent “edict” was passed in Europe, which we should all pay attention. In discussing affordable health care, socialized medicine or what ever you want to call it in the European countries we want to evaluate how these countries pay for health care. The British Isles depends on the Value Added Tax or VAT tax. Up until this recent change the tax was 17%. However, change is coming in two phases. Number one is the use of co-payments, which haven’t been part of the system since the 1940’s. Number two is the raising of the VAT tax to 27%. Yes, a tax elevation of 10%.

We will spend more time reviewing and evaluating the ACA, other comparative systems and hopefully will strategize modifications to the ACA, if possible.