A thought experiment

Let’s stipulate for the sake of argument that our goal in healthcare reform is to see to it that everybody has coverage for their medical needs, and that nobody suffers financial catastrophe or bankruptcy trying to pay for them.

Let’s say Solution A is to require everybody to pay the private insurance companies for insurance policies. Because many can’t afford the premiums, we could also take some taxpayer money and hand that over to the private insurance corporations in addition to the premium payments they will receive directly from the millions of new customers forced to buy their services.

Under Solution A, everybody would be covered, but there would be no limitation on the premiums they were charged, and therefore no limitation on the amount of consumer and taxpayer funds transferred to the insurance companies. Some of those funds would be used to pay for medical services. But medical services are known as “medical losses” for the corporations, so they will pay as little as possible, and continue to award bonuses to employees who are most successful in denying claims ((articles.latimes.com/2009/jun/17/business/fi-rescind17)). By the time they have paid for lobbying, advertising, compensation and profits, only 86 percent of every premium dollar will go to paying for medical services (2008 analysis prepared by the National Association of Health Underwriters).

Solution B would be to have the government pay medical professionals directly for everyone’s medical care, instead of taking money from consumers and taxpayers and then giving it to the health insurance companies. There would be administrative costs, but judging by Medicare, an existing government program that already follows this model, those costs would average only about three or four percent of the total costs. As in Solution A, the money to finance Solution B could come from a combination of premium payments and government subsidies.

But what if you don’t trust the government to cover your medical needs? If so, you’re flying in the face of evidence that medical consumers are more satisfied with Medicare, a government insurance program, than they are with employer-based coverage (Commonwealth Fund study published in May of 2009). But you have a right to your opinion, so here’s Solution C: give people a choice. You can either get private insurance or public insurance. As in Solution A, some money will still be transferred to the health insurance industry from new customers and government subsidies. But those who prefer to have their money given by the government directly to medical providers have that option. And because the administrative costs of the public option will be lower, having it competing will also put downward pressure on private insurance premiums.

Solution C is the one currently being proposed in the House. Solution B has been ruled off the table as unacceptable to the powerful health insurance lobby. Solution A—forcing everybody to buy private insurance without the public option—is the one that makes no sense. Yet it is the one that is currently being proposed by the Senate finance committee, and that, according to the current conventional wisdom, is the most likely one to ultimately pass.

We believe the main reason for this is that the health insurance industry has successfully promulgated five or six outrageous falsehoods to the population, as evidenced by an NBC poll done on August 18 and another one by the University of Indiana on August 23. The polls show pluralities or majorities of the population believing lies that can easily be debunked, like that the bills will cover illegal aliens (see section 246 of HR 3200, titled “No Federal payment for undocumented aliens”), or that the public option would have “death panels.” The “death panels” myth rests on the erstwhile section 1233 of H 3200, which said that voluntary consultations on end-of-life decisions—of a sort that many people are choosing to have right now—would be paid for. (The section has been dropped in reaction to the media firestorm, depriving low-income people of this choice).

Ironically, real-life “death panels” exist right now at private insurance companies: they consist of the employees who receive bonuses for denying claims, and rescission policies that drop people who get major diseases like lymphoma or breast cancer after they have paid thousands of dollars in insurance premiums during their healthy years (www.npr.org/templates/story/story.php?storyId=105680875).

The sidebar below provides you with links to independent fact-checking organizations that have evaluated the truth of many allegations about health care reform and cite the evidence for their evaluations. We suggest you follow the links and do your own research as to the truth about them. Then consider seriously whether Solution A, B, C or none of them makes sense to you, and let your representatives know what you think.

Check the facts on healthcare reform

Newsweek - www.newsweek.com/id/214254

CBS News— www.cbsnews.com/stories/2009/08/05/politics/main5215880.shtml

Good Morning America (video) — mediamatters.org/mmtv/200908130013?lid=1058075&rid=33299431

WebMD www.blogs.webmd.com/breaking-news/2009/08/health-care-reform-myths-vs-facts.html

Also in this issue:

• ‘We can’t allow that building to fall into the wrong hands.’

Dr. Punnybone

Pebble without a cause