Some Call It Health Care

Monday, April 02, 2007 at 08:39 PM

Dedicated free marketeers continue to do their best to muddy the waters in the health care debate, dragging the debate out as more and more people find themselves unable to afford health insurance or health care. But every now and then you get some information that really clarifies exactly how bad our current system is.

The results of a health care industry survey of 200 hospital and insurance company executives, as well as 1,000 consumers, commissioned by The PNC Financial Services Group and conducted by the independent research firm were released to the public on March 20. The press release offers a pretty damning look at the way our patchwork, insurer-dominated system actually (doesn't) work for consumers or for health care providers.

Among the survey results:

  • Almost one of every three dollars spent on health care goes to administration costs associated with health care claims and billing.
  • Hospital executives reported that an average of one in five claims submitted is delayed or denied, while 96% of all claims must be submitted more than once.
  • Nearly a quarter of consumers reported that a legitimate claim had been denied by their health plan; one in five of these consumers ultimately paid the claim out of their own pocket.

Insurance executives weren't too happy, either, reporting that they go back to hospitals two times, on average, to get all the information needed to pay a claim.

That last complaint doesn't draw a whole lot of sympathy from me, frankly. How damned complicated is a system -- and the terms of health insurance -- if insurers have to go back twice for more information and hospitals have to submit almost every single claim more than once? And whose fault is the complexity?

If your insurer's description of benefits runs to 100+ pages, and most insureds still have to call the insurer to find out what's covered, is it working? If you pay $10,000 a year for health coverage for you and a spouse, and over $3,000 of that goes to administration costs, is it working? If you have so many different people making very specific decisions on what is and isn't covered under rules that run to hundreds of pages, do you doubt that the exact same claim is approved for some and denied for others?

And while I'm asking questions, do you think that the survey's finding that a third of health care costs go to administration really takes account of all the administrative costs? You know it doesn't take account of the time that consumers, pharmacists, and others spend documenting claims and fighting denials.

Is there any real reason to think that switching to a single payer system would increase the amount of complexity and bureaucracy one bit?

The real bad news, to me, is that the survey is claiming that a full two thirds of the absurd current costs really go to paying for medical expenses. Why the hell are the medical costs themselves so absurdly high? Could it have something to do with the fact detailed in the New York Times a year ago or so that pharmaceutical companies not only charge Americans more than the rest of the world for the exact same pills, but then declare higher profits for their foreign operations than they do for their U.S. operations?

It's enough to make you sick, if you can afford it.

But the country is still infected with many zealots who view universal health care as an "abominable socialist leviathan," as one commentator from The National Ledger puts it.

And why exactly is this person so dead set against the simple concept of universal health care? Why, because:

In the 1950's physicians made a good living, yet the average person could afford a house call. What are the main contributors to the escalating cost of health care? There are probably several factors, but two of the main contributors are excessive government entanglement in underwriting the cost of health care, and the costs related to perpetual litigation for malpractice.

The anti-social right wing has certainly done its propaganda job. Where's the evidence to support either of those two factors being "main contributors" to rising health care costs? He doesn't need any evidence, he's heard that mantra so often, from so many (right wing) sources that it seems like a truism to him.


Don't forget that at least $2000 of the $10,000 family premium is going to pay for the uninsured. Those who still believe that they don't want to have to pay for uninsured Americans must understand that in reality we are all paying MORE for them than we ought to be, not only in dollars but also in human tragedies and senseless deaths, disablings and bankruptcies. The average family premium through an employer is cheaper than individually purchased, and is now $11,500 per year...but the coverage is not as good as we've had in the past. For understanding percentages the $10,000 figure is easier. I would argue that free market principles have had their chance and then some to solve this problem, and have failed. They trap us in a "Pay More Get Less" system as far as the eye can see. The problem is that it is not a free choice whether or not to purchase health coverage. Instead it is a captive market where free market rules work to the advantage of the suppliers, who are being artificially limited in number while demand is soaring. Balanced markets are preferable, but will not happen without intervention, and the government is the only entity capable of doing so. The problem is that our government refuses to take responsibility for protecting the Good of the Whole over the Welfare of the Few, even though American lives are at stake.

Excellent and well-worded comment, my friend - but here's two cents from one of those condescendingly-monikered 'uninsured:
I don't use any medical services whatsoever, save for a physical once every year, but sometimes two years go by.
I pay out of pocket my meager expenditures for, say, chiropractic, which is the only treatment I consistently seek.

Call it luck, decent genes or good diet and supplementation, vigorous physical labor in abundance, or a combination of all of the above, but the fact remains: I avoid our priced-for-the-wealthy system like the plague, and will so long as there's a breath in me.

Oh, there'll come a time when I get dragged into it, kicking and screaming - better yet, in a coma. But I'll put that day off as long as possible.
I figure I've saved a considerable fortune in the last 21 years of not having to watch my hard-earned scratch flushed down the HMO commode. That, in and of itself, is immensely satisfying!!!

So don't brand ME as one of those uninsured cretins who is driving up costs for others roped into a system that would love to swallow your life savings without a burp. It didn't get that way by MY doing.

My donations to PNHP and HEALTHCARE are in the mail!
Dave H.

See, and for my part, I'm uninsured as well, but only because I am self-employed and the premiums are absolutely ridiculous.

Because I'm not, though, I can't go to the dentist or see a specialist for Diabetes, none of that stuff. It's an interesting thing, really, because I suppose I'd use it if I had it, but I'm not really using any medical services, pay for my medications out of pocket, and just pay my own bills when they come up.

Everyone is so anxious to put a label on people. It's really just a little more than a little stupid, innit?


Mr. Russ's commentary is excellent and I have bookmarked it to refer to when I need impetus. His points about the complexity factor are conspicuously absent from many op-eds and other activist literature I have come across.
Just think - the PHARMATOCRACY and other tentacles of our MEDICAL/INDUSTRIAL COMPLEX like it that way - just like any entity which takes your hard-earned scratch and makes it as difficult as possible for you to deal with their bureaucracies. The 'Hassle Factor' plays well for these megalopolies, it seems, while, as Don Henley puts it in his memorable pop song 'End of the Innocence', "lawyers dwell on small details"....

I glanced at the National Ledger piece, but am afraid to read it, being unsure if I wish to take in that kind of 'friendly fascist' negativity.
Life's too friggin' short.
Dave H.