Fact and Fiction: Debunking Myths in the US Healthcare System

Umut Sarpel, MD; Bruce C. Vladeck, PhD; Celia M. Divino, MD; Paul E. Klotman, MD

Disclosures

Annals of Surgery. 2008;247(4):563-569. 

In This Article

Conclusion

In the effort to ameliorate the problems with our healthcare system, recently several programs for reform have been launched. Although well intentioned, these proposals have limited ability to affect change. For example, employer-mandated plans, such as the one recently instituted in Massachusetts, require individuals to purchase private sector insurance coverage. Pretax dollars are used to purchase policies, and a small portion of the cost is covered by an employer contribution. Although this proposal forces individuals to purchase insurance (under fear of tax penalties), it does not guarantee the existence of affordable plans. Serious concerns exist over the long-term financial viability of the program. As enrollment costs continue to rise, insurance companies can give the illusion of affordability by excluding services. Forcing consumers to purchase stripped-down plans does little to improve the quality of healthcare.

Another attempt at reform is through the creation of health savings accounts. Individuals can shelter part of their income from taxes by making deposits in such accounts and using these funds toward medical bills. By definition such programs favor individuals who are in higher tax brackets since they have more to gain from diverting pretax dollars. Obviously, individuals in these higher tax strata are not the appropriate targets for healthcare reform.

Adding graduated increases in coverage, although politically more palatable, has largely failed to impact the lives of the uninsured. Incremental plans such as the State Children's Health Insurance Program (SCHIP) are worthwhile but have failed to defray the ever-rising number of uninsured. Although SCHIP is responsible for a modest decrease in the number of uninsured children by 25% from 1996 to 2005, it has come at higher costs than anticipated.[50] The program is facing funding shortfalls in several states.

In the end, these paths at reform suffer from the same fatal flaw: they leave in place the existence of a multipayer, for-profit system. It is this infrastructure that is the Achilles' heel of the United States healthcare system. The crux of effective reform is the development of a simple, streamlined system of universal coverage by a single-payer.

Financial savings and good patient care flow naturally from universal coverage by a single-payer. All individuals would have access to cost-saving preventive care through generalists. Fewer people would have to rely on inefficient and expensive emergency departments for their primary care. A single-payer system maintains the bargaining power necessary to contract with pharmaceutical companies to lower the costs of medications and biotechnology. In addition, evidence-based utilization standards could be defined to guide selection of medications and procedures.

The largest source of savings in reforming our system would come from cutting the administrative costs associated with multiple private insurance carriers. Competition between for-profit insurance companies drives cost-shifting and ever-increasing out-of-pocket payments for patients. As patients' costs go up, more and more under-insured people are unable to afford healthcare. When many insurance carriers exist, they must compete for patients, and this competition is financed by massive administrative marketing costs. Many experts believe that universal coverage would likely pay for itself by creating a more efficient system.

Universal coverage and a single-payer plan could be created in different ways. Specific proposals have been published by various groups.[51] Universal coverage does not necessarily mean Medicare for all. Certainly, universal coverage could be provided by a single-payer government-run program as in Canada or the United Kingdom. Although this is the most straightforward approach, other countries have developed successful systems composed of private companies coupled with governmental organizations. For example, most of the German population receives its health insurance through sickness funds, which are nonprofit, closely regulated semiprivate organizations. The key is that these companies are required to cover a broad range of medical services and are prohibited from excluding individuals due to illness. Even in countries like Japan and Germany where health insurance is job-linked, times of unemployment, changes in workplace, and periods of self-employment do not create interruptions in healthcare coverage.

Finally, universal coverage and a single-payer plan do not exclude the option for purchasing additional private insurance. Supplemental insurance could exist that would cover nonessential medical care such as cosmetic surgery, private nursing, or even pay for expedited essential care. A new healthcare plan could be tailored to the preferences of the American population.

Myths have the ability to perpetuate themselves in the absence of supporting evidence. The myths concerning the state of the US healthcare system need to be actively dispelled-quickly. There are already overwhelming data showing the dangers of uninsurance and the benefits of universal coverage. There is no more deliberation that needs to be done. We must instead move on to making universal coverage a reality.

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