'Obama's reform: no cure for what ails us' -
The following commentary was published yesterday in the online BMJ (British Medical Journal), one of the world's leading scientific journals in medicine, under the heading of "Observations: U.S. Health Reform." The authors are available for interview.
Obama's reform: no cure for what ails us
By David U. Himmelstein and Steffie Woolhandler
As the applause fades for President Obama's health reform,
David Himmelstein and Steffie Woolhandler fear that the new law will
simply pump funds into a dysfunctional, market driven system
It was a stirring scene: President Obama signing the new health reform law before a cheering crowd, and a beaming vice president whispering in his ear, "This is a big f*cking deal." As doctors who have labored for universal health care we'd like to join the celebration, but we can't. Morphine has been dispensed for the treatment of cancer - the reform may offer a bit of temporary relief, but it is certainly no cure.
The new law will pump additional funds into the currently
dysfunctional, market driven system, pushing up health costs that are
already twice those in most other wealthy nations. The Medicaid public
insurance program for poor people will expand to cover an additional 16
million poor Americans, while a similar number of uninsured people with
higher incomes will be forced to buy private policies. For the "near
poor" the government will pay part of these private premiums, channeling
$447 billion in taxpayer funds to private insurers over the next
Unfortunately, private insurers win in the marketplace not
through efficiency or quality but by maximizing revenues from premiums
while minimizing outlays. They pursue this goal by avoiding the sick and
forcing doctors and patients to navigate a byzantine payment
bureaucracy that currently consumes 31 percent of total health
spending. The health reform bill's
requirement that uninsured people buy insurers' defective products will
fortify these firms financially and politically.
Meanwhile insurers will exploit loopholes to dodge the law's
restrictions on their misbehaviors. For instance, the limit on
administrative overheads will predictably elicit accounting gimmickry,
for example by relabeling some insurance personnel as "clinical care
managers." While insurers are prohibited from "cherry picking" -
selectively enrolling healthy, profitable patients - they've circumvented similar prohibitions
in the Medicare health maintenance organizations (HMOs). The ban on
revoking policies after an individual falls ill similarly replicates
existing but ineffective state bans.
Sadly, even if the reform works as planned, 23 million people
will remain uninsured in 2019. Meanwhile the public and other safety net
hospitals that uninsured people rely on will have to endure a $36
billion cut in federal government funding.
Moreover, many Americans will be left with coverage so skimpy
that a serious illness could lead to financial ruin. At present, illness
and medical bills contribute to 62 percent
of all bankruptcies, with three-quarters of the medically bankrupt being
insured. The reform does little to upgrade this inadequate coverage; it
mandates that private policies need cover only 70 percent of expected
medical costs. The president has often promised that "if you like your
current coverage you can keep it." Yet Americans who now get job based
insurance will be required to keep it - whether they like it or not. And
many who receive full coverage from an employer will face a steep tax
on their health benefits from 2018.
Soaring costs and rising financial strains seem inevitable,
that the reform will "bend the cost curve." Computer vendors have
trumpeted imminent cost savings for half a century (see, for instance, a
video made by IBM in the 1960s, available at http://bit.ly/cckdtB).
Prevention, though laudable, does not generally reduce costs.
Windfalls from prosecuting fraud and abuse have been promised before.
The new Medicare advisory board merely tweaks an existing panel.
Without an enforcement mechanism, stepping up comparative effectiveness
research cannot overcome drug and equipment makers' promotion of
profligate care. Existing insurance exchanges where patients can compare
and shop among private plans haven't slowed growth in costs
for public workers nationally or in California. And the mandated
experiments with capitated payment systems are warmed-over versions of
President Nixon's pro-HMO policies and subsequent failed initiatives to
fix America's health cost crisis through managed care.
Experience with reforms in Massachusetts in 2006 - the template
for the national bill - is is instructive. Our state's costs, already
the highest of any state, grew by 15 percent
in the first two years after reform, twice the national rate. Moreover,
capitated physician groups had costs at least as high
as those who were paid on a fee for service basis. Meanwhile, after
initial improvements in the state, access to care has begun to deteriorate,
and the state has begun to cut back coverage.
Overall, President Obama's is a conservative bill, drafted in
close consultation with the drug and insurance industries. Its modest
salutary provisions - such as an extra $1 billion a year for community
health centers and the expansion of Medicaid - mirror measures that have
been passed even under Republican regimes. Its central tenet, that the
government should force citizens to buy coverage from a for-profit firm,
was first proposed by Richard Nixon when faced with the seeming
inevitability of national health insurance in 1972. Similarly, Mitt
Romney, a favorite of conservatives, embraced the Nixon approach as
Massachusetts governor in 2006, a stance he has now abandoned.
Democrats, having retreated from their traditional push for national
health insurance, freed Republicans to move still further to the right.
Throughout the reform debate we, and the 17 000 others who've
joined Physicians for a National Health Program, advocated for a far
more thoroughgoing reform: a non-profit, single payer national health
insurance program. We will continue to do so. Our health care system has
not been cured or even stabilized. For now, we will continue to
practice under a financing system that obstructs good patient care and
squanders vast resources on profit and bureaucracy.
Passage of the health reform law was a major political event.
But for most doctors and patients it's no "big f*cking deal."
David U. Himmelstein, M.D., is associate professor of medicine
at Harvard Medical School and Steffie Woolhandler, M.D., M.P.H., is
professor of medicine at Harvard Medical School. They are also
co-founders of Physicians for a National Health Program.
Cite this as: BMJ 2010;340:c1778
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