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The Decline of America: Private Greed Costs Billions (Health Care)

    "If the universal coverage and single-payer features of the
    Canadian system were applied in the United States, the savings IN
    ADMINISTRATIVE COSTS ALONE would be MORE THAN ENOUGH to finance
    insurance coverage for the millions of Americans who are currently
    uninsured. There would be ENOUGH LEFT OVER to permit a reduction,
    or possibly even the elimination, of co-payments and deductibles"

        -- United States The General Accounting Office [GAO]


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Dear NPR,  

I was frankly astonished to find that in your coverage of Bush's plan 
on health care, as well as of alternative plans and strategies [All 
Things Considered, Thurs., Feb. 6th], you completely neglected 
coverage of a proposed National Health Care plan. 

This, despite the fact that several Democratic candidates for the 
presidency are in favor of such a plan [including Larry Agran, who was 
recently excluded from the MacNeil/Lehrer debate on TV, amazingly, 
despite polls showing him ahead of Jerry Brown and catching up with 
Tom Harkin, and whom I would very much like to see (or rather, hear) 
interviewed on All Things Considered] 

It is quite striking to hear you describe the $65 billion _cost_ of 
Bush's plan -- which he wants to pay for by slashing MediCare and 
MediCaid -- without any mention of the net _saving_ a National Health 
care system would entail -- savings in the many billions of dollars 
>from lower administrative costs _alone_, according to the GAO [1] 

For example, in 1987 alone almost $90 billion could have been saved 
(enough to expand access to care to all Americans) if the U.S. was as 
administratively efficient as Canada. [2] 

In 1990, the United States spent $640 billion on health 
care. With a Canadian-style system, at Canadian rates, we could cover 
everyone for $365 billion. [3] 

                            ***  ***  *** 

The lack of realization of all of this potential is all the more 
depressing in light of the general silence in the media about these 
crucial, central facts surrounding the Health Care debates. 

For example, earlier this winter when All Things Considered talked 
with a commentator about elections in different states and noted 
that voters had insisted on lower costs in one such election, and on 
health care in another, your interviewer practically snickered as she 
asked your guest whether these silly voters "just aren't putting two 
and two together?" 

It is hard to avoid the conclusion that NPR was either tragically 
misinformed on this issue, or worse, deliberately suppressed the 
crucial facts (and continues to do so) -- namely that better health 
care is not only _compatible_ with but goes _hand in hand_ with lower 
cost if a single-payer Canadian-style system is adopted in America. 

Don't get me wrong. I'm not just saying that a National Health 
Insurance (NHI) plan should have been mentioned in your Feb. 6th 
coverage; by any fair and rational standards, such coverage belongs in 
practically every piece you do on the health care debates, rising 
health care costs, or on the millions of uninsured Americans; not 
merely because of the statistics alluded to and the key facts they 
represent, but more basically because of the world we live in -- in 
which the United States stands alone as the only Western industrial 
country without such a national health plan. 

Sincerely, 

Harel Barzilai 

Department of Mathematics // Cornell University // Ithaca NY 14853 
Email: harelb@math.cornell.edu 

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[1] The General Accounting Office [GAO] stated in a 1991 report that 
"If the universal coverage and single-payer features of the Canadian 
system were applied in the United States, the savings IN 
ADMINISTRATIVE COSTS ALONE would be MORE THAN ENOUGH to finance 
insurance coverage for the millions of Americans who are currently 
uninsured. There would be ENOUGH LEFT OVER to permit a reduction, or 
possibly even the elimination, of co-payments and deductibles" [In 
These Times, June 26-July 9, 1991. My added emphasis] 

The article also notes that "In 1970 both Canada and the U.S. spent 
about 7.4 percent of their gross national products on health care. By 
1989, The U.S. spent 11.6 of its national income on health and Canada 
only 8.9 percent. Yet in Canada more health care service was delivered 
per person than in the U.S., according to a recent report by the U.S. 
General Accounting Office" 

[2] _Health Letter_, February 1991 issue, of the Public Citizen 
 Health Research Group. Page 8, "Should the Private Health Insurance 
Industry Be Eliminated?" which "summarized internist Dr. Thomas 
Bodenheimer's article ``Should We Abolish the Private Health Insurance 
Industry.'' Dr. Bodenheimer is a member of Physicians for a National 
Health Program, and his article appeared in _The International 
Journal of Health Services_ last year (Vol 20, No. 2, 1990)" 

The article includes the comparisons: 

================================================== 
Billing, administration, and insurance 
overhead as percentage of total spending: 

U.S.:           22% 
Canada:         13.7% 
U.K.            11.1% 
================================================== 

and 

============================================================ 
Percentage of premiums consumed by overhead: 

Private Insurance Companies:              12% (overhead & profits) 

Public payers (e.g. Medicare, Medicaid):   3% 

Canadian provincial insurance plans:      under 1% 
============================================================ 

[3] Jan/Feb 1991 _In Health_ magazine, which adds that in Canada, 
according to a recent study, citizens each spent $18 a year for 
"administrative costs," while each of us spent $95 -- for a total of 
$20 billion more than we would have with Canadian-style care.  Our 
doctors, hospitals, and nursing homes spend much more --$62.1 billion 
by a 1983 estimate-- filing out insurance forms, billing patients, and 
collecting. 

The article notes that compared to other countries, "[The U.S. health 
care "system"] is certainly the most expensive. In 1987, we spent 
$2,050 per citizen on health care. Canada spent an average of $1,480, 
most European nations even less. 

"Unfortunately, spending the most hasn't made us the healthiest. 
Canada, culturally most like the United States, has an infant 
mortality rate 25 percent lower. Their rate of heart disease death is 
20 percent lower. Their average life span --77.1 years-- is almost two 
years longer" 

Similar conclusions were reached by a Business magazine [See 
"Condition Critical" cover story, Business Today, Fall, 1990, which 
summarized in hard numbers in its charts how "America spends the 
most... but gets the least"]