Last Thursday at a town hall meeting in Rio Rancho New Mexico President Barack Obama was asked why, when "so many people go bankrupt using their credit cards to pay for healthcare. Why have they taken single-payer off the plate (audience applause), and why is Senator Baucus on the Finance Committee discussing health care when he has received so much money from the pharmaceutical companies? Isn't it a conflict of interest?" (more audience applause)
The President seemed uncomfortable with the question, and his entire response lasted longer than seven minutes. He did not get around to actually responding to the question until about four minutes in:
"Healthcare is one-sixth of our economy, so it is a complicated and difficult task. Congress is going to have to work hard, and everybody is going to have to come at this with a practical perspective as opposed to being ideologically pure in getting it done... Why not do a single-payer system? ... A single-payer system is like, Medicare is sort of a single-payer system, but it's only for people over 65, and the way it works is, uh, the idea is you don't have insurance companies as middle men. The government goes directly and pays doctors or nurses.
"If I were starting a system from scratch then I think that the idea of moving toward a single-payer system could very well make sense. That's the kind of system that you have in most industrialized countries around the world. The only problem is that we're not starting from scratch. We have historically a tradition of employer-based healthcare. And, although there are a lot of people who are not satisfied with their health care, the truth is that the vast majority of people currently get health care from their employers, and you've got this system that's already in place.
"We don't want a huge disruption as we go into healthcare reform where suddenly we're trying to completely re-invent one-sixth of the economy. So what I've said is, let's set up a system where, uh, if you already have healthcare through your employer and you're happy with it, you don't have to change doctors. You don't have to change plans. Nothing changes. If you don't have healthcare, or you're highly unsatisfied with your healthcare, then let's give you choices. Let's give you options, including a public plan that you can enroll in and sign up for. That's been my proposal.- Advertisement -
"Now, obviously as president I've got to work with Congress to get this done. And, ha ha ha. There are folks in Congress who are doing terrific work. They're working hard. They've been having a series of hearings. Uh, I'm confident that both the House and the Senate are going to produce a bill before the August recess. And, it may not have everything I want in there or everything you want in there, but it will be a vast improvement over what we currently have. We'll then have to reconcile the two bills, but I'm confident that we are going to get healthcare reform this year, and start putting us on a path that's sustainable over the long term. That's a commitment I made during the campaign, and I intend to keep it."
The President's response left no doubt that he has taken single-payer healthcare off the table, but his answer lacked the logic and candor we have often come to expect of him. In fact his response seems more than a little disingenuous, and it cannot be permitted to stand unchallenged.
First of all, it is clear that President Obama understands what single-payer is, and given his assertion that it would be the way to go if we were starting from scratch, clearly he realizes that it is the superior system, one that "most industrialized countries around the world" have embraced, and yet he offers what are clearly rationalizations for why we cannot go that route in the United States.
The president suggests that it would be too disruptive to dismantle the "employer-based healthcare" system, yet this system is a total failure. The fact that employers bear much of the cost of healthcare in this country puts us at a distinct disadvantage in international trade because employers in other countries do not bear this substantial cost. The cost of healthcare to U.S. business is responsible for much of the out-sourcing that has cost our economy millions of jobs, and has resulted in much of our car manufacturing fleeing across the border to factories in Canada. More and more businesses are cutting back healthcare benefits, passing a greater percentage of the cost on to employees, or dropping health benefits entirely simply because the cost is overwhelming their eroding bottom line to the point where their very survival is often threatened.
The Business Roundtable reported recently that "Health care costs are one of the top cost pressures facing American businesses today, inhibiting job creation and hurting America's ability to compete in global markets." An ever-growing percentage of the American workforce is finding the cost of employer-based health insurance too costly to bear. In the past decade the number of uninsured working Americans has swelled by more than 6 million and now represents 18% of our workforce, or nearly 27 million people. And that's just the working Americans.
The current world financial crisis is also causing millions of Americans to lose their health insurance when they lose their jobs. This is a uniquely American phenomenon because the rest of the industrialized world has universal healthcare, and the loss of a job in those countries does not carry with it the additional burden of the loss of healthcare (recent studies suggest that the stress that accompanies the loss of a job can often in itself bring on additional health problems).
Barack Obama surely knows all of this, so when he suggests that it would be disruptive to dismantle our employer-based system, he realizes that the reality is that most employers would gladly be relieved of this burden. It doesn't take much of a stretch to also recognize that there are millions of Americans trapped in jobs they hate but dare not give up for fear of losing their employer-based health insurance.
President Obama points out that healthcare costs represent one-sixth of our economy. The President is correct. It is estimated that healthcare expenditures in the United States in 2008 were just under $2.7 TRILLION representing 17% of the gross domestic product (GDP). That number is expected to reach $4.3 TRILLION by 2017, or 20% of GDP. What the President leaves out is that the United States spends more than twice as much per capita on health care than the other developed countries in the world and that as a percentage of GDP healthcare costs in the United States exceed those in the other developed countries by more than 70 percent. What distinguishes those other developed countries from the United States is that they all have universal, not-for-profit healthcare.
The president suggests that we dare not tamper with the essential nature of our healthcare system because it represents one-sixth of our economy but he fails to point out that transitioning to a single-payer model would almost certainly radically reduce the currently bloated cost of healthcare in the United States both in absolute terms and as a percentage of GDP.