Universal health care – A necessary option

We danced around our health care crisis for too long. Conservatives were trying to solve health care by the magic of free market economy. Liberals were not brave enough to come up with any bold move to cover everyone albeit they are branded as socialists or communists. Anyone with decent understanding of economics and politics of our contemporary time knows _” what matters is what works. We know _” in economics there is no absolute free market economy nor is there any absolute state run economy. Most of the developed countries are some where in between. The nation which blend both in an effective way is the nation which is becoming successful. Voltaire said long time ago _” “common sense is not so commonly among the common people.” What he meant, many a time we get bogged into narrow ideological and philosophical debate and we forget about the real people of the real world.

Yes, time has arrived _” for America to take bold step in solving crisis in health care management that we have ignored for more than a few decades. We should have addressed this issue of “health care for everyone” in 1970s or at the latest in 1980s. Every indications were there at that time that we were leading to health care crisis. Our leaders were seduced and sometime armed twisted by health care industry complex -.made up of HMOs, Drug and Insurance industries. As a result, we have the worst health care management system in the whole developed nations. According to the latest count, we have 16 percent of our population- 46 million go without health insurance. Studies by the Institute of Medicine suggest that thousands of people, may even tens of thousands, die prematurely every year because they don’t have health insurance. Seniors choose between prescriptions and groceries, and families choose between the mortgage and hospital bills. Health insurance has become too expensive and every year it is increasing by 8-12 percent _” far higher than inflation and salary adjustment (if any). Working class American can’t afford health insurance and the middle class America’s back is on the wall.

While all the developed countries have universal health care, guaranteeing the health care access to everyone; interestingly, our health spending per capita is much higher (on average double) than the developed countries. The United States pays more for it’s health care than any other nation on the planet: 16 percent of our GDP. However, OECD health data 2004 indicate; we have one the lowest life expectancy, highest infant mortality, low rate of physicians, nurses, and hospital beds among the developed countries. New Republic editors commented: nor do Americans always get “more” medical care, as is commonly assumed. Japan has more CT scanners and MRI machines than we do. And the French, whose medical system the World Health Organization recently declared the planet’s best, have more hospital beds. In a series of polls a few years ago, just 40 percent of us said were “fairly or very” satisfied with our health care system, fourth worst of the 17 nations surveyed.

Researchers from Harvard Medical School found: The United States wastes more on health care bureaucracy than it would cost to provide health care to all of the uninsured. Administrative expenses consumed at least $400 billion out of total health expenditures of $1660 billion in 2003. Streamlining administrative overhead to our northern neighbor Canada’s level could save $285 billion in 2003. $6,940 for each of the 41.2 million Americans who were uninsured in 2001.This would have been substantially provide full insurance coverage for the uninsured. The administrative structure of the US health care system consumes a large share of health spending. In 1999, administrative spending consumed at least 31 percent of health spending. In contrast, administrative cost in Canada, which has a national health program since 1971, is about 16.7 percent of the health spending. Over and above Canada spends 55c for each $ we spend per person. Laws of economics warn that there are “tradeoffs between efficiency and equity, but health care in America is both inefficient and inequitable.”

Harvard researchers also found, while Canada and other developed nations have a single insurance plan or single-payer model that pays bills for everyone, the U.S. has a complex and fragmented payment structure build around thousands of different insurance plans, each with its own regulations on coverage, eligibility, and documentation. The participation of private insurers raise administrative costs anyway. In U.S. the overhead cost of private HMOs is more than 30%, where as the overhead cost of Medicare program is around 5%. Functions essential to private insurance but absent in public programs _” e.g. underwriting, marketing, and corporate services _” account for two-third of private insurer’s overhead. At the end of the day, the average citizen will be better of, if the health care is guaranteed by the government for everyone. We don’t have to follow Canada model necessarily. We have reasonably good model in our home front. We may have single insurance plan for everyone by following our Medicare program with some adjustments. It will be funded by 5% payroll deduction (both employers and employees) in collaboration with federal and state governments. Let’s use our creativity with common sense. We can’t be a world power with sick citizens.


Dr. Nasir Ahmed is a professor of public administration in the Political Science/Public Administration Department at GSU.