This time it's different because an odd mix of Wall Streeters, Main Streeters and even Hollywood types are taking up the issue. Not only has a coalition of more than 40 major corporations called for federal reform of the way America runs its health care system, but now documentary filmmaker Michael Moore has turned his camera onto the subject in his new film Sicko. And pulling it all together is a new plan from Oregon's Sen. Ron Wyden, a liberal Democrat.
"Our nation is facing a crisis that demands immediate attention," Steve Burd, chairman of Safeway stores, told the New York Times. Burd organized the Coalition to Advance Healthcare Reform, which represents nearly two million workers at firms like Pepsi, General Mills and Kroger. Burd, who has fought bitter labor wars with his own employees over health benefits, says out-of-control health care costs are hurting American companies' competitiveness; many corporations are paying more in health costs than they make each year in profit.
It's become so serious for corporate America that even Wal-Mart has come out in favor of universal health coverage by 2012.
"Unfortunately, simply making this a moral issue hasn't worked," says Andy Stern, president of the nation's largest union, the Service Employees International. Even though he has fought big business on the picket lines in the past, he supports -- in principle -- the efforts of the Coalition.
It surprised everyone to learn that Burd, a conservative Republican, had advised Wyden, a liberal Democrat, on the plan.
"I think health care has been studied enough," Wyden said on the Senate floor in January. "It has been commissioned. It has been blue-ribboned. It has been the subject of white papers, blue papers, pink papers, papers of every possible description. It is time for the Senate to act."
Allergic to Reform
Health care has been such a tangled mess for so long that perhaps the only way to tackle it is with a truly bipartisan proposal like Wyden's. Back in 1994, the freshly elected Bill Clinton took it on -- and everybody remembers how that turned out: It blew up in his face. What people forget is that even then, big business was desperate for help. In fact, the right-wing U.S. Chamber of Commerce endorsed the outlines of the Clinton plan. But when small businesses objected, and talk radio fanned the flames, reform was DOA.
All that's happened since is health care costs have consistently outpaced inflation (and are set to grow by another 11 percent this year), insurance companies imposed their own versions of reform, and health care horror stories like those recounted in Sicko have mounted. Still, the glee with which health care reform was killed has left a chill, and few politicians have been willing to touch what might be called the other third rail of politics. Congress couldn't even muster the courage to regulate HMOs in 1998, at the height of the public's outrage over abuses documented in those systems.
States, however, have enacted their own reforms, a grab bag of well-meaning mandates directed at insurers, along with some nibbling-at-the-edges cost-cutting measures. Recently, both California and Massachusetts have taken it up a notch by pledging universal coverage.
But in both those states, the reforms rely on the old system of having individuals get their health insurance through their employer. Wyden's plan makes a break with that tradition, calling for a new era in which individuals are required to buy their own health insurance from a wide range of choices, and businesses would be given enough incentives and tax breaks to pay higher wages. A federal solution would also combine the states' 50 different playing fields into one.
The Lewin Group, a prominent health industry analyst, has calculated that the Wyden plan would not cost anything to implement, and would, in fact, save as much as $4 billion a year. Wyden claims that over a span of years, the savings would climb into the trillions.
One of the big reasons behind Wyden's call to put people in charge of their own health care decisions is to create responsibility. "It is easier to get information about the cost and quality of washing machines than it is to get information about health care," Wyden told his Senate colleagues. As long as consumers are disconnected from the real costs of health care, Wyden and others believe, many will fail to make the extra effort to stay healthy.
"America doesn't have health care; it has sick care," Wyden added -- an observation backed up by the fact that two-thirds of all Medicare dollars are spent on the sickest 5 percent of the patients.
If incentives were created to reward healthy behavior, and if insurance companies could build plans accordingly, the idea is you would create more competition.
"Competition is the foundation for affordable health care," says Kevin Parker, co-owner of Dutch Bros. Coffee in Spokane. "American consumers like choice and diversity, but our insurance industry doesn't match that."
In fact, it's rarely allowed to, says Jack McRae, senior vice president of legislative affairs for Premera, the Inland Northwest's largest health insurance provider. "We could sell less expensive plans without mandates in them," he says.
Mandates are rules by which insurance companies must play. In Washington, there are dozens -- including, for example, not allowing insurance companies to discriminate between age groups, and to provide certain levels of coverage for mental health. In fact, during the last session of the Washington Legislature, a governor's blue-ribbon panel recommended allowing insurers to offer mandate-free plans. The governor signed a bill enacting many of the panel's recommendations, but the mandates remained in force -- in fact, the reform package even added new ones.
"Why can't we have basic health plans so not everyone has to buy a Cadillac?" wonders Parker, who has 14 employees he is trying to cover. "If we figure out ways to offer basic plans, we will reduce the number of uninsured dramatically."
An Opening Window?
Burd has said that if a system like Wyden's isn't adopted, the country could very well get fed up and adopt a single-payer system, as people like Michael Moore and other observers of European health care have come to admire. After all, it's hard to pin blame on a shifting set of circumstances that includes expensive new technology/drugs, treatments of questionable impact, and the patchwork of legal minutiae now governing the system. But it is easy to blame, as Moore does so emotionally in Sicko, all the red tape. Americans may finally just get mad enough to force through a single-payer system, which would remove insurance companies from the equation altogether. But Burd may have the bureaucratic behemoth that is the new Department of Homeland Security in mind when he argues that putting the government in charge is an outcome the country should seek to avoid.
Premera's McRae says if the coalition can hold together and grow through the upcoming elections, the window of opportunity will open in 2009. And Wyden's plan, crafted as it has been with the input of business, could be the starting point for the first serious shot in 15 years at one of America's most nagging problems. Still, don't get your hopes up too much.
"Everyone's looking for that silver bullet to bring down the cost of health care, and there is none," says McRae. "It's going to be a whole bunch of incremental changes."
For details on the Healthy Americans Act, check out www.wyden.senate.gov or www.coalition4healthcare.org. This article first appeared in InHealthNW, a sister publication of The Inlander.
PLANS AT A GLANCE
COMPILED BY DOUG NADVORNICK
Every candidate who wants to move into the White House has to have a health care reform plan; here are the major presidential candidates' positions
Giuliani would shift health coverage from an employer- and government-provided model to one in which people buy their own coverage. He believes people should take more responsibility for their health care needs and that insurance companies, freed from government mandates, should offer people more choices so that they can build their own policies. The former mayor of New York City proposes the federal government give families an annual $15,000 tax credit for health insurance, allowing them to keep the money they save if they can find less-expensive policies. He also encourages people to create health savings accounts, allowing families to put aside money to help them pay medical bills. He says people should not be required to buy insurance coverage.
McCain believes health care can be made more affordable and available by expanding the federal S-CHIP children's health program (coverage for families too rich to qualify for Medicaid programs, but too poor to buy private insurance). The Arizona senator would also help communities expand their health clinics and give tax incentives and credits to poorer families to encourage them to buy insurance. He would make it easier for people to create their own health savings accounts. He says people should not be required to buy health insurance.
As Massachusetts' governor, Romney signed into law a bill that requires all citizens to have health insurance, although he doesn't favor a federal requirement that people buy insurance. In Massachusetts, families who earn less than three times the federal poverty rate can get insurance on a sliding fee basis, and children in those families can get free care through Medicaid. Companies are required to provide coverage within families for children up to the age of 25. Businesses with 10 or more employees must contribute to their employees' health insurance costs or be required to pay the state up to $295 a month for full-time employees. The new law also encourages insurance companies to develop lower-cost, lower-benefit policies. Romney believes all states (freed from some federal regulations) should work, like his, to make sure every person is insured, although he believes the market should drive costs and benefits.
Clinton has introduced a seven-step health care program. She would create a "National Prevention Initiative" to reduce the number of people who have diabetes and/or are obese. She would require all health insurance companies to provide coverage for high-priority prevention services. The senator from New York would also provide money to help hospitals, doctors' offices and other medical providers move to "paperless" computerized health insurance technologies. Clinton says she would provide incentives for providers to improve care to people with chronic illnesses. She says she would fight to stop companies that don't insure sick people or those with pre-existing conditions, or who saddle those people with more expensive policies. The senator says she would work to allow generic drugs to be more available and she would promote reforms to the nation's medical malpractice system.
Edwards bills his program, "Universal Coverage Through Shared Responsibility." The former senator from North Carolina wants to require employers to provide their workers with insurance or to help those workers buy their own coverage. He would expand the federal Medicaid and S-CHIP programs. Edwards also proposes to create regional health care purchasing pools so that small businesses and individuals can use the "strength-in-numbers" concept to get lower-priced insurance policies. He would give tax credits to middle-class families to help them buy insurance. Once these steps are taken, Edwards would require all Americans to buy health insurance, through either private or public sources. He would also create what he calls a "Consumer Reports" for health care, a universal report card that would help consumers evaluate hospitals' and doctors' records in treating diseases and injuries.
Obama says he would create a new affordable federal health care plan, similar to the plan available to Congressional members, for those who don't have access to private insurance. He also proposes to create a "National Health Insurance Exchange" to help people shop for private insurance. Obama says the exchange would "act as a watchdog group and help reform the private insurance market by creating rules and standards for participating insurance plans..." The senator from Illinois would require employers to make "a meaningful contribution" to their employees' health care coverage or contribute part of their payrolls to the new federal health care plan. Obama says he would require that all children have health coverage. He says he would open the federal Medicaid and S-CHIP programs to more patients and he would give states more flexibility to implement their own health care proposals.
SOURCES: Susan J. Blumenthal, M.D., Jessica B. Rubin, Michelle E. Treseler, Jefferson Lin and David Mattos, U.S. Presidential Candidates' Prescriptions for a Healthier Future: A Side-by-Side Comparison, Huffington Post, July 8, 2007; Wall Street Journal; Beyondquotes.com; MittRomney.com; HillaryClinton.com; JohnEdwards.com; BarackObama.com.
Sicko vs. the Senator
by BETH SLOVIC
Michael Moore and Oregon Sen. Ron Wyden both want to fix a broken health care system. Let's contrast their views.
What's the problem?
MOORE: In two words, bean counters. Most Americans probably don't need to see Sicko to shudder when they hear the phrase "insurance company." Faceless and seemingly omnipotent, insurance companies decide not only what cancer treatment is worth covering, but also how much of that cancer treatment will be covered.
The horror stories are plentiful, and Moore points his lens at just a few of the 25,000 anecdotes he collected by asking fans to e-mail those tales to him. And then there are the Americans who don't have insurance, either because companies have rejected them for being too fat or too sick -- or they're too poor to pay the premiums. These are the folks who, like an Oregon man in the opening segment of Sicko, are forced to decide which of their two mangled fingers they can afford to reattach with their own money.
WYDEN: The senator also takes aim at health insurance companies, but he's not proposing we junk them. Instead, he argues, our system fails because it burdens private employers with the responsibility of providing health insurance to its workers. Wyden says this link between employment and insurance has three downsides for employees: The hidden benefit lowers workers' take-home pay; employees typically don't have a say in choosing their insurer; and, if they change jobs, they lose their coverage.
It's bad for employers because they pay the hefty tab, if they can afford it. And it's bad for the country, because it subsidizes the system each year with $200 billion in tax credits that favor wealthier Americans without providing adequate resources for the working poor and uninsured.
"Right now employer-based coverage is just melting away like a Popsicle on a summer sidewalk," Wyden says.
So what's the source of the problem?
MOORE: Health insurance companies that contribute cash to the politicians who return the favor by promoting legislation that increases profits for the companies. And pharmaceutical companies that get in on the action, driving up costs while peddling products that are sometimes of dubious worth.
Medicare Part D, the prescription-drug plan for senior citizens championed by the Bush administration, is Moore's prime example of a public-private venture that benefited the health insurance and pharmaceutical companies at average Americans' expense. His evidence:By 2016, Americans will have paid more than $800 billion for the program. Passing the bill cost the pharmaceutical industry only $3 million in campaign contributions over four years to George Bush and the 10 federal legislators largely responsible for crafting the plan in 2003, according to the Center for Responsive Politics.
WYDEN: His answer lacks as sexy a villain as Moore's, but it is no less vexing: the federal tax code.
More than any other part of the tax code, the incentives greasing the wheels of our employer-based healthcare system are regressive and inefficient, Wyden says. "This one's in a league of its own," he says.
And we arrived at this point entirely by accident. After World War II, price and wage controls combined with a widespread desire to provide health insurance to returning troops and other Americans led employers and the government to strike a deal. Businesses would provide the coverage, and the feds would reward them for their generosity. Now, 60 years later, the tax code provides deductions for employers who can afford to offer health insurance to their workers -- who receive the benefit tax-free. Meanwhile, the boss man who can't pony up gets nothing. His workers? Zilch.
So, smart guys, what's your plan for fixing the problem?
MOORE: Easy. A government-run system like the one in Canada, the United Kingdom, France or -- egad! -- possibly Cuba.
Commonly known as a single-payer system (since government is ultimately responsible for forking over the cash under these arrangements), it's dismissed as a form of "socialized medicine" by critics who don't have Che Guevara T-shirts in their closets. Moving to such a system would eliminate health insurance companies and require revamping the entire healthcare industry -- the largest American job sector in 2004, with 13.5 million employees, according to the U.S. Bureau of Labor Statistics.
WYDEN: His plan would create universal coverage by doing three things. First, it would shift the responsibility for seeking insurance to individuals, who would be required to have coverage. New state agencies would act as clearinghouses to assist people in finding suitable plans. Meanwhile, employers would still be allowed to help their workers with this process if they chose. But the shift essentially cuts the link between employment and health coverage.
Second, it would revamp the tax code by erasing the old incentives for businesses and giving new tax breaks to individuals. At first, companies would be required to transfer the savings (from getting rid of health benefits) to their workers in the form of higher wages. Employees would then use that extra money to pay for insurance premiums. At the same time, individuals could deduct that expense from their income taxes. And since the plan calls for ending Medicaid, it would also fully subsidize premiums for poor individuals. (It would leave Medicare and military health care alone, however.)
Third, it would impose new rules on insurance companies to prevent them from cherry-picking the healthiest consumers and dumping the sickest clients. "A lot of people want to put them out of business," Wyden says of the health insurance industry. "They want the government to run health care. [Under my plan] insurance companies have to give ... but they get something in return, and that's a chance to be in a big market."
Who's on board?
MOORE: His championing the single-payer system is the equivalent of a pledge drive for advocacy groups like Physicians for a National Health Program, which has been lobbying for a government-run medical system for 19 years. In addition to supporting the ideas outlined in Moore's film, the doctors' group is critical of proposals such as Wyden's, which give a central role to private health insurance companies.
Other supporters include Democratic presidential candidates such as Dennis Kucinich and Mike Gravel, who have no hope of winning their party's nomination.
WYDEN: Wyden has made efforts to build bipartisan support for his bill; U.S. Sen. Bob Bennett (R-Utah) has signed on as a co-sponsor. He's also tried to please employers and unions. Andy Stern, president of SEIU, the health care labor group, and Steve Burd, head of Safeway, a Fortune 500 employer, both joined Wyden at the press conference to introduce the proposal in December.
What will it cost?
MOORE: Moore turns this question on its head in his film and asks what our dependence on private industry costs us in terms of human lives. Physicians for a National Health Program, which argues on behalf of the same system, says a single-payer system wouldn't cost taxpayers any more than they currently pay.
WYDEN: According to the Lewin Group, an independent consultant firm, all of the new program costs would be fully funded by savings from changing the tax code, getting rid of Medicaid, and other administrative cuts. In addition, total health care spending in this country would decrease because of price competition, Lewin's report says.
Sicko vs. the Senator by BETH SLOVIC first appeared in Willamette Week.