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OpEdNews Op Eds    H4'ed 4/3/10

Single-Payer: Ten Years and Counting

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Message Stephen Pizzo
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It was the "Mr. Big Talk" in me that several months ago was pounding his chest declaring:"No Public Option, No Re-election, No Kidding!"

But, when push came to shove, I took what I could get out of the messy, stupid-laden debate over health care reform.

So, why did I, and many other progressives, just suck it up and accept this skim-milk disguised as cream?

Because it became clear that we had to fail at least one more time. We seem determined to prove -- once again - that the business of health care is not the same as the business of widget production and sales. Health care can't be produced like a widget, by chasing cheap labor around the world. Health care is not your everyday commodity. It's more like national defense where, while private sector companies are involved, the policies are set and managed by government. Bush tried to outsource that to companies like Blackwater and what he got was exactly what we have now in the health sector, mercenary health insurance companies that are loose canons on the nation's deck. Duh.

The health care "reforms" just passed will not solve much. Putting 35 million more souls into that system, while the right and compassionate thing to do, will only speed up the inevitable collapse of the for-profit health insurance scheme. Because there are physic-like rules in a free-market economy that preordain outcomes. One of those rules is that higher demand for existing resources will raise, not lower the value (as in cost) of those products or services. For example, insurance companies don't build infrastructure to accommodate growth in demand for health care services. They simply pay for them when claims are filed (if you're lucky.) Who's going to build the hospitals, train the doctors and hirer the nurses that will be needed for those 35 million new patients?

I don't know a local government that's not broke right now, so they're sure not going to provide these additional assets. That leaves only two ways to deal with this surge in demand:

1. Higher prices

2. Rationing of services

I know, that's what Republicans were warning, further proof that even a broken clock is right twice a day. But the GOP raised these issues for different, and far less helpful, reasons than I raise them. I see them as the tough medicine we apparently insist on gagging on before we accept the single-payer solution.

Higher prices caused by scarce resources will narrow insurance company profit margins, which will in turn cause insurance companies to raise rates and cut covered services. Elimination of life-time caps on coverage and the requirement to offer affordable coverage to those with pre-existing conditions will completely upend the actuarial foundation upon which insurance companies control risk. And risk is what health insurance is all about. Only single-payer, which forces everyone into a single insurance plan, can manage the enormous risks involved in the health insurance business. That is not just Mr. Big Talk spouting off again, it's actuarial fact. You can't have universal health care without a single-payer system. Period.

Now, don't get me wrong. Forcing insurance companies to shape up and toe these lines was long overdue. What I am saying is that these reforms are simply a rest stop along a road leading inevitability to a universal, single-payer health care system.

Unfortunately the nation did not seem ready to part with the devil it knew - the for-profit health insurance system - for the kind of system every other advanced nation on earth embraced long ago - a regulated, single-payer - as the only civilized, humane and sustainable heath care system.

The good news is that these halfway measures made law last week, while not solving much, will reveal the truth once and for all. Even the modest constraints the new law places on insurers will smoke them other for what they really are - parasites, and not the useful kind. In fact, that process has already begun:

WellPoint Tells Investors It Will Game Health Reform Law to Reap More Profit

Message to Investors Says Insurer Will Re-Label Overhead, Administrative Costs as "Medical Care" to Meet New Law's Requirement to Cut Overhead

Washington, DC -- Consumer Watchdog called on the Obama Administration and the Department of Health and Human Services today to probe insurance giant WellPoint Inc. in light of an electronic message to investors describing how it would simply re-label administrative costs as "medical care" in response to the new health reform law. The message follows revelations that WellPoint, parent company of Anthem Blue Cross, also intentionally padded already huge premium increases in California, just in case regulators demanded reductions.

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Stephen Pizzo has been published everywhere from The New York Times to Mother Jones magazine. His book, Inside Job: The Looting of America's Savings and Loans, was nominated for a Pulitzer.

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