It’s the 21st Century, Stupid!

The New York Times reports on an investigation by New York state AG Andrew Cuomo that has uncovered what appears to be a rigged system to determine the “reasonable and customary” rates charged by health care providers. The determination is made by a company named Ingenix and is used by insurers to determine payments made by insurance companies when customers have to see doctors outside of the insurers’ networks. The problem is that Ingenix is owned wholely by UnitedHealth Group. Golly gee, there’s no room for a possibility of abuse, is there? Cuomo not only thinks there is but has done investigations that seem to show that abuse has been taking place. What a shock.

I like the essence of Senator Obama’s health care ideas but I think we just need to go farther. Comparisons to the system in Canada and Great Britain are always made by conservatives but they ignore other countries that have more government involvement than we do, including single payer systems that work much better than those two countries. This of course includes the rest of Europe. But in the real world it is questionable whether even any of those variations would be politically achievable in the United States. So I tried to think of something else. If anyone stumbles across this blog opinions and input are something I’d love to read.

First, nothing beyond current regulations except for consumer protection legislation would be passed limiting private insurance companies. But they’re still going to have to adapt to the existence of a new type of insurance organization. This organization would have a closer relationship to the government than the Post Office, but like it not be an actual agency of the government. It would be a purely non-profit health care organization like no other.

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David Broder writes about a plan to fix our health care problems with a “publicly subsidized individual health insurance”. Of course this concept is somewhat useless. OK, it’s lots of “thought” about a proposal that will do nothing to help improve our system. Why won’t it? The key lies in this paragraph.

Instead, the report calls on government to restructure the private insurance market in less rigid form than Hillary Clinton proposed 14 years ago — and then step back and let competitive market forces do their invaluable work of forcing recalcitrant insurers, doctors and hospitals to bid against each other on the basis of price and quality.

Competitive market forces do not simply function magically in a vacuum. The primary concept behind the ability of the market to accomplish what these people expect it to is the rational choice theory, which is also used in other social sciences. Rational choice in turn relies on a rational actor. The assumption of the existence of a rational actor is one where the people taking part in the economy are willing and able to make a choice based purely on their knowledge of their needs, the product being purchased and their ability to pay for it. It does not account for irrational fears, emotions or choices based on incomplete information or lack of understanding. The plain truth is that the vast majority of the American populace does not have any information base for making these choices and the plans that hope to use the magic of the free markets do not address that fact. There are economists and social scientists addressing the limitations of this part of neoclassical economic theory, as shown by this article in Harvard Magazine but apparently those who are proposing that the market will solve the problems in the American health care system don’t acknowledge them. They also don’t acknowledge the desire of those in the health care industry to distort rational choice with advertising, small print, legalese and the ability to in effect change the terms of any agreement unilaterally much as their compatriots in other industries do. Look at this article from SmartMoney and realize that those who propose that the current system, largely unchanged, is what we need to stick with believe it is perfectly acceptable that consumers go through this routine. I disagree.

At least I think that this doctor writing an op-ed for the Washington Post does. He calls the Republicans for their constant refrain of socialism, socialist and socialized when ranting against their political opponents proposals. There’s just no way it can be called a discussion when this rhetorical overkill and inaccuracy is used.

Of course that’s not what the New York Times OpEd piece is titled. It is in its way more accurately titled The Socialists Are Coming! The Socialists Are Coming! to highlight the empty rhetoric that is used in attacks on any government involvement in health care…except for the avoidance of attacks on those programs that would crucify them politically like the VA or Medicare.

I particularly like the last paragraph, which points out what I consider to be a basic truth of the debate:

The take-home message for voters is this: Look behind the labels to judge health care proposals on their merits. Whenever you hear a candidate denounce something as a step toward socialized medicine, it probably isn’t. More likely the politician is demagoguing the issue or is abysmally ignorant of the inner workings — and real, not ideological, failings — of the country’s multifaceted health care system.

That’s what David Ignatius writes about in the Washington Post. What it comes down to is a variation on my criticism of what motivates much of the current American business world. It’s not enough to make a profit. There’s never enough profit, apparently. The search is always on for a greater margin or rate of return no matter how risky or how questionable it might be for the long term good of the company or our society. It doesn’t matter what happens to those thousands of people you fire from their jobs so that Wall Street will approve of you enough to up the stock value and the incomes of those executives who receive a significant part of their income from stock options. There is no other value that matters. Now keep in mind that many would have this environment and set of values determine everything about our health care system.

MSNBC also informs you of 9 Things the Insurers Don’t Want You to Know. Among them is that if you become expensive to them they’ll go over your records to see if there is absolutely anything that they can use against you as a reason to drop your coverage retroactively. They call it recission.

You know how the insurance companies tell you that you should get things pre-approved? Look at this little gem.

 “Preapproval is often what triggers the rescission review,” says Shernoff. “If it’s for hip surgery, that’s an expensive item that they’ll look at and see if you’re a candidate for rescission.

Catch-22, anyone?

At almost any blog that discusses politics the subject of health care will come up. There is no lack of people to defend the current system if it’s been good to them. Of course good to them generally means no serious illness in their life or the lives of those close to them. Because the great shock is that often those who are hurt worst by the system, having their financial lives destroyed are in fact insured when their ordeals begin. MSNBC had this report about what is not nearly as rare as it ought to be. In fact it just shouldn’t be allowed to happen at all. Don’t forget that your credit rating is looked at now by potential employers and landlords as well as places you want credit from. Destroying your financial life has far greater implications than most people realize.

Robert Stein is posting about health care on his blog. He points out this most logical fact.

We get most of our mail through “a self-supporting postal corporation wholly owned by the federal government” while those who can afford it use FedEx and other private providers. Why not our medical care? We have the example of Medicare which is far from perfect but works reasonably well for older Americans.

In spite of the complaints that some people make, given what they deal with the USPS does a pretty good job. Not perfect, but damn good. One thing that this not-for-profit corporation would do is something similar to what I was involved with when I worked for Planned Parenthood of Greater Kansas City many years ago. I was the data processing department and worked for the CFO. A lot of the work of planning an annual budget was answering a very important question: “How little can we charge?”. Everything was on a sliding scale. The less you made the less you paid. If in fact the concept of this corporation being totally paid for by taxes is a non-starter why can’t it work on a sliding scale basis and what you pay into it depends on what you make? Companies could still subsidize employees expenses as an employment benefit but should someone lose their job their health coverage isn’t lost. If private companies adapt and become some kind of “premium” service they too can be a benefit provided by businesses. In addition I have another suggestion for this hypothetical health care equivalent of the USPS. Do not make a false distinction between anything that factors into health. Make certain that mental health is treated as seriously as physical health. Provide decent dental coverage. Help people with vision care. If you need a pragmatic reason for doing these things just think of how much more productive employees can be when they see what they’re doing clearly, aren’t distracted by a toothache and aren’t having emotional problems that aren’t being treated.

Google has had one of its employees create a (so far) relatively minor brouhaha over comments she made concerning Michael Moore’s Sicko, criticizing it heavily and pointing out that the ads that Google can sell health care companies can help them “…better manage their reputations through “Get the Facts” or issue management campaigns.”. When her post started getting noticed she “clarified” things.

In my opinion her clarification contains one of the greatest fallacies I’ve heard in recent history. She claims

Whether the healthcare industry wants to rebut charges in Mr. Moore’s movie, or whether Mr. Moore wants to challenge the healthcare industry, advertising is a very democratic and effective way to participate in a public dialogue.

Whatever you might feel about the de facto situation in this country just when did it become so very acceptable to equate money with “democracy” or something being democratic? Admittedly the Supreme Court has told us that limiting money in political campaigns is the same thing as limiting speech. And then someone actually thinks that having the money, and we’re not talking small change here, is what makes for a democratic way to participate in public discourse. Is that really where we want to go? Where is the voice of those who don’t have money when any organization that tries to speak for them is dismissed as just another special interest group or denigrated by some other name?

Will being an individual who has that kind of money be the only “acceptable” way to have a discernible voice in public debates some day? I may write a blog but I am lost in a sea of similar voices. Won’t this be true of the overwhelming majority of the non-wealthy who try to find a voice? No, advertising is not a force for democracy or on behalf of the individual in any conflict between the wealthy and non-wealthy in our society.