June 21, 2009

National health care insurance makes sense

Dr. David Stornelli
Guest essayist

This week, Congress began work on sweeping health care reform legislation, with the ambitious goal of containing costs and expanding coverage. Media coverage has focused on the government financed "public option," which Mitt Romney called a "Trojan horse" designed to destroy the health insurance industry and create a single-payer system. In reality, the proponents of a true single-payer system, embodied in John Conyers' bill HR 676, have been excluded from any participation in the development of this historic legislation.

While the debate over the public plan rages on cable talk shows, the difficult question of how to contain health care spending while expanding coverage is largely ignored. Economists warn that the current rate of health care spending is unsustainable. The United States spent $2.4 trillion on health care in 2008, an average of almost $8,000 per person, double what other industrialized countries spend. Health care has grown from 5 percent of the economy in 1960 to 16 percent today, and if current trends continue will reach 35 percent by 2040. These costs make businesses less competitive globally and depress wages at home. Fewer employers now provide health insurance benefits and those that do offer plans with fewer benefits that increase out-of-pocket costs dramatically. This adds to the growing number of uninsured and underinsured. Tragically, many Americans are a diagnosis away from bankruptcy or preventable death.

Is it possible to achieve affordable universal coverage without a single-payer system? Experience and common sense suggest it is not. The Obama plan shares many features with the Massachusetts health care reform enacted in 2007, which mandates that employers and individuals purchase private health insurance or pay a penalty. Universal coverage in that state has not occurred (although the percent of uninsured has dropped), and costs have vastly exceeded projections. A preliminary analysis by the Congressional Budget Office released June 15th estimates Obama's plan will cost $1.2 to $1.6 trillion over 10 years, and will reduce the ranks of the uninsured by only one third.

Single-payer, or "Medicare for all," is the only solution that would actually reduce costs and cover everyone. The greatest opportunity for cost savings in the current system is reducing the administrative waste created by the health insurance industry. Administrative overhead accounts for nearly one-third of all health-care spending; a single-payer system could save $400 billion annually. Forcing people to purchase private health insurance will increase health care costs, leave as many as 37 million Americans without coverage, and worsen our nation's economic woes.

Stornelli is an internist in private practice in Rochester. He is vice chair of Finger Lakes Chapter of Physicians for National Health Program.