Transcript PNHP 2007

Universal Health Care: A
Business Case for Single Payer
National Health Insurance
April 12, 2008
Robert Zarr, MD, MPH, FAAP
[email protected]
MY STORY
•
•
•
•
Sept 22, 2007,at 1pm, I was assaulted
Loss of consciousness
Ambulance ride & ER visit
NO in-network ambulance coverage for my
insurance policy?
• Monthly bills from DC EMS
• After 5 months, insurance finally paid ONLY
75% of transport cost
Best health care system
in the world?
We are one of the Youngest
Populations in the Industrialized
World
20
15
12.4
12.8
U.S.
Canada
16.0
16.3
U.K.
France
18.6
19.0
Germany
Japan
10
5
0
OECD, 2006 (2003 Data)
% population smoking daily
Fewer Americans Smoke
Compared with Other Nations
35
30.0
30
25
20
17.0
17.5
Canada
U.S.
24.2
24.3
Italy
Germany
26.0
15
10
5
0
OECD, 2006 (2003 Data)
U.K.
Japan
We Drink Less Alcohol
16
14.0
Liters/capita (15+)
14
11.2
12
10.2
10
8
7.4
7.6
Japan
Canada
8.4
6
4
2
0
OECD, 2006 (2003 Data)
U.S.
Germany
U.K.
France
Our Quality is Not the Best in the world
Survival Rates for 5 Countries
Australia
Canada
England
2nd
2nd
best
worst
2nd
2nd
best
4th
3rd
3rd
best
best
best
4th
worst
worst
worst
3rd
3rd
worst
worst
3rd
best
4th
4th
3rd
*
2nd
best
4th
2nd
2nd
worst
3rd
3rd
AMI, ages 20-84
best
worst
NA
2nd
NA
Stroke, ages 20-84
2nd
best
NA
worst NA
Breast Cancer
Colorectal Cancer
Cervical Cancer
Childhood Leukemia
Kidney Transplant
Liver Transplant
Non-Hodgkin’s
Lymphoma
Source: Health Affairs Vol 23:#3 , 2004
N.Z.
U.S.
% with same doctor > 5 years
Continuity of Care
100%
80%
60%
52%
65%
65%
Australia
U.K.
57%
45%
40%
20%
0%
U.S.
New
Zealand
Commonwealth Fund Survey, 1998
Canada
% finding it difficult to get care
How hard is it to get care?
30
28
25
21
20
15
15
15
15
New Zealand
Australia
U.K.
10
5
0
U.S.
Canada
Commonwealth Fund Survey, 1998
We are Average in the Number of
MRI Units
MRIs/ million population
40
35.3
35
30
25
20
15
8.6
10
5
2.8
4.7
9.1
11
6
0
France
Canada
Germany
U.S.
Source: OECD, 2005
Note: data are for 2004 ,or most recent year available
Denmark
Italy
Japan
We Do Fewer Hip
Replacements
Procedures per 100,000 population
200
180
160
140
120
100
80
60
40
20
0
197
182
146
125
126
U.S.
N.Z.
133
106
Canada
Italy
Source: OECD 2006
Data are for 2004 or most recent year available
Australia
U.K.
Sweden
We are the best at
spending the most
money to be ranked
th
37 in health outcomes
by WHO!
Major Concepts
 We have no system coordinating access, cost
containment or financing of services and care
 Most health care costs are fixed
 Few using it at any one time but all of us want
it be there
 We are already paying the whole bill which is
more than enough to assure us all coverage
for comprehensive care
The Basics





Rising health care costs are the root of most
of the problems in health care
Most costs are fixed whether health care is
used or not
Other countries cover everyone, have more
services, higher quality and live longer yet
spend far less than we do
We are already paying the whole bill
You can’t hold down costs without a system!
National Health Spending:
Per Person
Actual
$11,660
Projected
$10,339
$9,173
$8,090
Per capita
expenditures
$7,129
$6,280
$5,485
$3,604
$3,910 $4,257
$4,729
1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
Source: Centers for Medicare & Medicaid Services
National Health Spending
as a share of Gross Domestic Product
Projected
Actual
20.0
15.4
12.8
Percentage
GDP
16.0
16.5
13.8
9.1
7.2
5.2
1960 1970
1980 1990 2000
Source: Centers for Medicare & Medicaid Services
2002 2004 2006
2015
Where is the money going?
U.S. Health Expenditures 2004
Nursing home /home
he alth
8%
Drugs/Me dical
Supplie s
13%
De ntal/O the r
Profe ssional
10%
Insurance
Administration
7%
$1.9 trillion
Physician
21%
Govt.He alth Activitie s
3%
Hospital
Source: Centers for Medicare&Medicaid Services
Inve stme nt
7%
30%
U.S. Health Expenditures 2004
Nursing home /home
he alth
8%
Drugs/Me dical
Supplie s
13%
De ntal/O the r
Profe ssional
10%
Physician
21%
Insurance
Administration
7%
70% spent
on services
&
infrastructure
Inve stme nt
7%
Govt.He alth Activitie s
3%
Hospital
Source: Centers for Medicare&Medicaid Services
30%
Health Care Infrastructure:
Enough to serve all Americans
As of 2004, the U.S. had:

13.5 million health care jobs


7,228 hospitals with a total of
955,768 staffed beds

210,939 physician’s offices

70,589 nursing homes

19,006 home care agencies

121,172 dentist’s offices
Source: National Center for Health Statistics
Most of the money is spent on a few
people in any one year
80
73%
70
20% use 86% of the care
60
50
Percent
of
health
Care
Expenditures
40
30
20
10
0%
0%
0%
1% 1%
2%
4%
6%
13%
0
10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Source:Agency for Healthcare Research and Quality
MEPS, 1999
Important Question:
• Whose responsibility should it be to pay for
the health care services we all expect to be
there should we need them?
The Implications of Fixed costs

The cost of the infrastructure is there whether
or not it is used (nurse, hospital)

Trying to save money by keeping patients out
of the hospital is like trying to save money on
schools by keeping kids home for the day

It is much more cost effective to invest in only
what we need.
How do we
PAY
for health care?
Health Care Financing
 We have no state or national healthcare policy
 We finance health care services on a wing and
a prayer (no dedicated funds)
 Financing of health care amounts to a shell
game… no payer wants to pay the fixed costs
of health care
 When that fails we ask the public to step in
(risk shift)
If you were in an insurance company
CEO, who would you want to insure?
80
73%
70
60
50
Percent
of
health
Care
Expenditures
40
30
20
10
0%
0%
0%
1% 1%
2%
4%
6%
13%
0
10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Source:Agency for Healthcare Research and Quality
MEPS, 1999
Most of the money is spent on a few
people in any one year
80
73%
70
20% use 86% of the care
60
50
Percent
of
health
Care
Expenditures
40
30
20
10
0%
0%
0%
1% 1%
2%
4%
6%
13%
0
10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Source:Agency for Healthcare Research and Quality
MEPS, 1999
If you were in an insurance company
CEO, who would you want to insure?
80
73%
70
80% uses less than $1000
of care per year
60
50
Percent
of
health
Care
Expenditures
40
30
20
10
0%
0%
0%
1% 1%
2%
4%
6%
13%
0
10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Source:Agency for Healthcare Research and Quality
MEPS, 1999
Administration is the Fastest
Growing job in Health Care
3000%
2500%
2000%
1500%
1000%
500%
0%
1970
1975
1980
1985
Physicians
Source: Bureau of Labor Statistics and NCHS
1990
1995
Administrators
2000
One-Third of Health Spending is
Consumed by Administration
Administrative
Costs
Clinical
Care
31%
($2000 per person)
69%
Source: Woolhandler, et al, New England Journal of Medicine, August 2003 & Int. Jrnl. Of Hlth. Services, 2004
Health Insurance Costs Keep Rising
Fewer Firms Are Offering
Insurance…
THE COST OF CARE CREATES
HEALTH PROBLEMS AS WELL AS
FINANCIAL PROBLEMS
 In nearly 3 in 10 (29%) households, someone
skips a medical treatment, cuts pills, or does not
fill a prescription because of cost
 Nearly 1 out of 4 (23%) Americans have problems
paying medical bills
 More than 1 in 5 (21%) Americans had an overdue
medical bill at the time of a 2004 survey
 1 million people experience medical bankruptcy
each year
Health Care Costs Survey, USA Today/Kaiser Family Foundation/Harvard School
of Public Health, August 2005; D. Himmelstein et al, Health Affairs, 2005
18,314 Die Every Year Due to
Lack of Health Insurance
More than six times the number of
soldiers killed in Iraq
Equal to a 747 jet crash every week
More than 6 times the number
who died on September 11th
Source: Care Without Coverage;Institute of Medicine,2002
Most of Healthcare is already
publicly financed
Individuals
20%
Taxpayers
60%
Private
employers
20%
Source: NEJM 1999; 340:109; Health Affairs 2000; 19(3):150
{Medicare, Medicaid.
Public employees,
tax subsidies}
In the End Individual Households Pay for
All of Health Care
INDIVIDUAL
HOUSEHOLDS
Lower
wages
Private
employers
pay for health
insurance
Taxes for
Medicare and
Medicaid
Individual health
insurance
Out of pocket
Property taxes
Higher prices
for goods
Health insurance for
public employees
18
US Health Costs Rise Faster
than Other Countries’ Costs
US
Health Costs as Percent of GNP
16
Canada
14
France
Germany
12
Japan
UK
10
8
6
4
2
0
1960
1970
1980
1990
1995
Source: Health United States 2005, Natl. Center for Health Statistics
2000
2004
We pay higher taxes
UK
$2,413
Canada
$2,664
Japan
$2,694
France
$3,096
Sweden
$3,155
Germany
$3,205
$5,711
U.S.
$ Per Capita
OECD, 2006 & Health Affairs 2002; 21(4): 99
Out of Pocket Costs are Higher
$/per capita
$900
$803
$800
$700
$624
$600
$519
$500
$472
$403
$400
$300
$239
$200
$100
$0
U.S.
Australia
Italy
Source: OECD 2006
Data are for 2004 or for most recent year available
Figures adjusted for purchasing power parity
Canada Germany
France
Other Industrialized Countries
Availability of expensive technology
Rising drug costs
Have similar demographics
Similar levels of service
Why are their costs so much lower?
Why costs are so much lower
in other countries
Administrative simplicity
Negotiated prices
More primary care and prevention
Health planning
Global budgets
They have a system
Fundamental Features of a
True Health Care System
Everyone included
Public Financing
Clear accountability
Public Stewardship
Budget Process
Investment Model
 Healthcare is regarded as a public good with
investment in needed services for the whole
population
 The costs of these shared services are spread
across the whole population
 Pools money and pays for health care directly
Single Payer Health Care Systems
 Sweden, Norway, Denmark, Canada, Finland, Iceland,
Australia, and Taiwan all have single payer financing
 Single publicly financed risk pool that pays for health
care directly from a fund ear-marked for health care
 Everyone has access to privately delivered, publicly
financed health care services
 Public can buy health insurance for services not
covered by public plan.
House Resolution 676:
http://thomas.loc.gov/cgi-bin/thomas
United States National
Health Insurance Act
(Expanded and Improved
Medicare for All Act)
The 4 principles of single payer:
1. Access to comprehensive health care is a
human right.
2. The right to choose and change one's physician
is fundamental to patient autonomy.
3. No corporate profit and personal fortune.
4. In a democracy, the public should set overall
health policies.
Single Payer NHI
guarantees:
•
•
•
•
Comprehensive Care
Quality
Choice
Affordability
Single payer NHI would cover every
American for all lifetime medicallynecessary services:
acute, rehabilitative, long term and home
care, mental health, dental services,
occupational health care, prescription
drugs and supplies, and preventive and
public health measures
Prescription Drugs and Supplies
• NHI would pay for all medically necessary prescription
drugs and medical supplies, based on a national
formulary
• Regional expert panels would establish and regularly
update the formulary
• NHI would provide all Americans with full coverage for
necessary drugs and supplies
Payment for Physicians and
Outpatient Care: 3 Options
1. fee-for-service, or
2. salaried positions in institutions
receiving global budgets, or
3. salaried positions within group
practices or HMOs receiving
capitation payments
NHI will save $5000 per capita
by 2024
Per Capita Health Expenditures
$21411 vs 16480
25000
$16623 vs 13434
Dollars
20000
$12114 vs 10405
15000
$8828 vs 8059
10000
5000
Source: Lewin Group 2002 and Dean
Baker, Center
current system
single payer
24
20
23
20
22
20
21
20
20
20
19
20
18
20
17
20
16
20
15
20
14
20
13
20
12
20
11
20
10
20
09
20
08
20
07
20
06
20
20
05
0
Financing Single-Payer
Medicare
Medicaid
Payroll Tax
Single-Payer
Health Care
Fund
$$$
Income Tax
Negotiated formulary with physicians, global budget for hospitals, increased
primary and preventive care, reduction in unnecessary high-tech interventions,
bulk purchasing of drugs and medical supplies =
long term cost control.
How Might It Be Paid For?
One Example:
Revenue Sources for
Single Payer Program
Employer Payroll
Tax (8.17%)
33%
Employee Payroll
Tax (3.78%)
15%
Federal
Government
(existing)
34%
Other
8%
State and Local
Govt (existing)
10%
Note: Payroll tax on incomes above $7,000 and below $200,000 only.
Source: Health Care for All Californians Act: Cost and Economic Impacts Analysis, The Lewis Group, January 19, 2005
Projected 2010 Health Care Expenditure Comparison of:
Current Health Care System to those of National Health Insurance (NHI, Improved and Expanded Medicare for All, HR 676)
Status Quo
($ billions)
NHI
($ billions)
Spending
Federal spending (Medicare, Medicaid, DSH, etc.)
957
957
Spending
State and Local spending
348
348
Spending
Private Insurance spending (premiums)
950
0
Spending
Out of pocket spending (co-pays, deductibles, over the counter drugs,
etc.)
317
80
Spending
Other private funds spending (foundations, etc.)
204
0
Savings
Savings from reduced administrative cost (paperwork)
0
278
Savings
Savings from bulk purchase of Rx DRUGS
0
87
Savings
Savings from non-durable medical supplies
0
13
Savings
Savings from durable medical supplies
0
9
Additional
Revenue
Additional Payroll Tax
0
538 (3.3%
increase over
current 1.4%)
Additional
Revenue
Stock transfer tax (0.25% on seller and buyer)
0
150
Additional
Revenue
Corporate Welfare Reduction
0
100
Additional
Revenue
Reversal of 2001 and 2002 Tax Cuts
0
251
Additional
Revenue
Tax surcharge (5% on highest top 5% earners and 10% on top 1%
earners)
0
200
Total ($billions)
2,776
3,011
Surplus
0
235 (3,011-2,776)
“Would you prefer the current system or
Universal Health Insurance…”
6%
32%
62%
Washington Post/ABC News Poll, 10/20/03
How Do We Know It Can Be Done?
•
Every other industrialized nation has a
healthcare system that assures health care for all
•
All spend less than we do; most spend less than
half
•
Most have lower death rates, more
accountability, and higher satisfaction
•
No country has ever adopted single payer, found
it to be worse, and switched back
Can we afford NHI?
We can't afford
NOT to have NHI!
Is this politically
feasible?
Broad Support from:
• 88 US Congressional co-sponsors of HR 676
(more than any other bill)
• 59% of US physicians (Annals of IM 2008)
• 70,000 medical students
• 75,000 nurses
• 213 labor organizations
• 2 state governments (Kentucky and N.H.
House of Representatives)
• 20 city governments
• 17 AFL-CIO state chapters
Visit:
pnhp.org
sickocure.org
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Sign open letter in support
of single payer:
pnhp.org/letter
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Call your Congressperson to ask
for his/her support of HR 676:
Capitol Switchboard:
202 224 3121
Robert Zarr, MD, MPH, FAAP
[email protected]