counterpunch - Health Care Reform: Yes, We Can!

Yes, We Can! Can We?
The Next Failure Of Health Care Reform
By VINCENT NAVARRO
Counterpunch March 6, 2008
http://www.counterpunch.org/navarro03062008.html

A major problem-if not the major problem-for many people
living in the U.S. is the difficulty of accessing and
paying for medical care when they are sick. For this
reason, candidates in the presidential primaries of
2008-the Democrats more often than the Republicans-have
been recounting stories about the health-related
tragedies they have encountered in meetings with
ordinary people around the country (an exercise
conducted in the U.S. every four years, at presidential
election time). These stories tell of the enormous
difficulties and suffering faced by many people in their
attempts to get the medical care they need. I have been
around long enough-I was senior health advisor to Jesse
Jackson in the Democratic primaries of 1984 and 1988-to
know how frequently Democratic candidates, over the
years, have referred to such cases. The only things that
change are the names and faces in these human tragedies.
Otherwise, the stories, year after year, are almost the
same.

In the Democratic Party primaries of 1988, for example,
candidate Michael Dukakis talked about a young single
mother who had two jobs and still could not afford
medical insurance for herself and her children. In 1992,
Bill Clinton did the same, changing the story only
slightly. This time it was the case of a woman with
diabetes who could not get health insurance because of
her chronic condition. And now, in the 2008 primaries,
Hillary Rodham Clinton (whom I worked with on the White
House Health Care Reform Task Force in 1993) describes a
similar case. This time it is a single woman, with two
daughters, who cannot pay her medical bills because her
congenital heart defect makes it impossible for her to
get medical insurance coverage. And Barack Obama
describes similar cases, with the eloquence that
characterizes all of his speeches. He frequently refers
to his own mother, who had cancer and had to worry not
only about her illness but about paying her medical
bills.

All these cases are tragic and are representative of a
situation faced by millions of people in the U.S. every
year. But, I am afraid that unless the winning
Democratic candidate, once elected president (and I hope
he or she will be), develops a more comprehensive health
care proposal than any of those put forward in the
primaries so far, we will see the same situation
continue. Democratic candidates in the 2012 primaries,
and in the 2016 primaries, will still be referring to
single mothers with chronic health conditions who cannot
pay their medical bills. The proposals put forward by
Obama and Clinton underestimate the gravity of the
problem in the U.S. medical care sector. The situation
is bad and is getting worse: the number of people who
are uninsured and underinsured has been growing since
1978.

Let's start with the uninsured, those people who do not
have any form of health benefits coverage. There were 21
million uninsured people in the U.S. in 1972. By 2006,
that number had more than doubled to 47 million. And
this increase has been independent of economic cycles.
The number of uninsured grew by 3.4 million from 2004 to
2006, even as a resurgent economy raised incomes and
lowered poverty rates. Meanwhile, during those years,
the Democratic Party establishment distanced itself from
any commitment to resolving these problems. Even though
the 1976, 1980, 1984, 1988, and 1992 Democratic Party
platforms included calls for health care benefits
coverage for everyone (what is usually referred to as
"universal health care"), that call was usually made
without much conviction. In the primaries of 1988, when
I was involved in preparing the Democratic platform,
Dukakis (the winner of the primaries) resisted including
universal health care in the party platform. He was
afraid of being perceived as "too radical." He had to
accept it, however, because Jesse Jackson agreed to
support Dukakis (Jackson had 40% of the Democratic
delegates at the Atlanta convention) only if the
platform included this call for universal care.

Then, in 1992, Bill Clinton (who borrowed extensively
from Jackson's 1988 proposals) put the call for
universal health care at the center of his program. But,
once president, his closeness to Wall Street and his
intellectual dependence on Robert Rubin of Wall Street
(who became his Secretary of the Treasury) made him
leery of antagonizing the insurance industry. It was
President Clinton's unwillingness to confront the
insurance companies that led to his failure to honor his
commitment to work toward a universal health care
program (see my article "Why HillaryCare Failed" unch,
November 12, 2007). The type of reform President Clinton
called for was a health insuranceA- based model called
"managed care," in which insurance companies remain at
the center of health care. An alternative approach could
have been to establish a publicly funded health care
program (which was favored by the majority of the
population) that would cover everyone, providing medical
care as an entitlement for all citizens and residents.
This could have been achieved, such as by expanding the
federal Medicare program to cover everyone. To do so,
however, would have required neutralizing the enormous
power of the insurance companies with a massive
mobilization of the population against them and in favor
of a comprehensive and universal health care program.

But President Clinton's loyalty to Wall Street
prevailed. His administration's top priorities were
reduction of the federal deficit (at the cost of reduced
public social expenditures) and approval of NAFTA
(without amending President George H. W. Bush's
proposal, which Clinton had inherited, and refusing to
address the concerns of the labor and environmental
movements). These actions antagonized and demoralized
the grassroots of the Democratic Party. Clinton lost any
power to mobilize people for the establishment of a
universal health care program. This frustration of the
grassroots, and especially the working class, also led
to the huge abstention by the Democratic Party base in
the 1994 congressional elections and the consequent loss
of the Democratic majority in the House, the Senate, and
many state legislatures. At the root of this
disenchantment with the Clinton administration was its
unwillingness to confront the insurance companies and
Wall Street. Could that happen again?

The health care mess (Nixon dixit)

Before addressing this question, let's look at the
problems people face in the U.S. But first, I should
stress that the country has sufficient resources to
provide comprehensive, high-quality medical care to
everyone who needs it. The U.S. spends 16% of its GNP on
medical care, almost double the percentage spent by
Canada and most countries of the European Union (E.U.)
on providing universal, comprehensive health care
coverage to their populations. We in the U.S. spend $2.1
trillion on medical care, making the medical care sector
one of the largest economies in the world (if the
medical care sector were a country, rather than a
massive sector within a country). And it has been
estimated that this spending will reach 20% of GNP in a
few years (7 years according to some, 12 years according
to others). Lack of money is not the root of the medical
care problem in the U.S. We spend far, far more than any
other developed country, and far more than what we would
need to provide comprehensive health care coverage for
everyone. The frequently heard argument that the U.S.
cannot afford universal, comprehensive care has no
credibility. It is a poor rationale for keeping the
situation as it is.

Despite the huge amount of money spent on medical care,
the situation of the U.S. medical care sector is a
disgrace. Even Richard Nixon, in an unguarded moment,
defined it as a mess. And as noted above, it has gotten
much worse since Nixon was president: in 2006, 47
million Americans did not have any form of health
benefits coverage, and 108 million had insufficient
coverage. And people die because of this. Estimates of
the number of preventable deaths vary, from 18,000 per
year (estimated by the conservative Institute of
Medicine) to a more realistic level of more than 100,000
(calculated by Professor David Himmelstein of Harvard
University). The number depends on how one defines
"preventable deaths." But even the conservative figure
of 18,000 deaths per year is six times the number of
people killed in the World Trade Center on 9/11. That
event outraged people (as it should), but the deaths
resulting from lack of health care seem to go unnoticed;
these deaths are not reported on the front pages, or
even on the back pages, of the New York Times,
Washington Post, Los Angeles Times, or any other U.S.
newspaper. These deaths are so much a part of our
reality that they are not news. How can this be
tolerated in a country that claims to be a civilized
nation?

The Democratic candidates' proposals

The proposals put forward by the current Democratic
candidates for president, Barack Obama and Hillary
Clinton, will improve the situation. They will diminish
somewhat the number of those not covered by health
insurance and will reduce the level of undercoverage.
But the major problems will remain unresolved, including
the problems the candidates have referred to during
their campaigns. People will still experience incomplete
coverage, and many millions will continue to be
uninsured and underinsured. Not even the mandatory
health insurance called for by Hillary Clinton will
resolve these problems. Her plan proposes that, just as
a car driver in the U.S. must have car insurance, so a
citizen or resident will have to have health insurance.
The problem with this mandate is not only-as Obama has
pointed out-the matter of enforcement (note that
according to some estimates, up to 20% of car owners
drive without car insurance), but the assumption behind
the policy. The assumption is that most people who are
not insured are "free-riders," people who could afford
to buy insurance but choose not to, and choose to let
someone else pay for their care when they get sick. But
the vast majority of people who are uninsured are people
who cannot afford to pay for it. It's as simple as that.
Massachusetts passed a mandate of this sort (under
Governor Mitt Romney), but 198,000 people still remain
uninsured. The subsidies and tax incentives proposed to
help the uninsured pay for health insurance premiums
under plans of this type are insufficient.

Another proposed mandate (put forward by Clinton more
strongly than by Obama) is that all employers must
provide insurance coverage to their employees-a policy
proposed by President Nixon back in the 1970s. But with
this proposal, unless you force employers to provide
comprehensive coverage at an affordable cost to
everyone, the problem will still not be resolved. An
even greater problem with the employer mandate, however,
is that it continues to tie health benefits to
employment, which is a perverse system and a nasty one.
The reason employers, in 1948, pushed to make health
care benefits dependent on employment (in the nefarious
Taft-Hartley Act) was that this was a way of controlling
workers. The Taft-Hartley Act forced the labor force to
get health care benefits through collective bargaining
agreements that are highly decentralized and are
negotiated at the place of employment. In the U.S.,
workers who lose their jobs lose not only wages, but
also health benefits coverage for themselves and their
family. And if these workers want to keep their
insurance, they have to pay prohibitive premiums. So, a
worker will think twice before striking. This is one
reason why the U.S. has fewer working days lost to
strikes than other developed countries. Until recently,
employers have been the major force-besides the
insurance companies-for keeping the current system of
funding and managing health care. This system, then, is
based on an alliance between employers and the insurance
industry.

It is this alliance that is responsible for the biggest
problem of health care benefits: undercoverage. Most
people believe that because they have health insurance,
they will never face the problem of being unable to pay
their medical bills. They eventually find out the truth-
that their insurance is dramatically insufficient. Even
for families with the best health benefits coverage
available, the benefits are much less comprehensive than
those provided as entitlements in Canada and in most
E.U. countries. And paying medical bills in the U.S. is
a serious difficulty for many people. In fact, inability
to pay medical bills is the primary cause of family
bankruptcy, and most of these families have insurance.
Furthermore, 20% of families spend more than 10% of
their disposable income on insurance and medical bills
(the percentage is even higher for those with individual
insurance: 53%). In 2006, one of every four Americans
lived in families that had problems in paying medical
bills. And most of them had health insurance.

The inhumanity of this situation is made evident by the
fact that nearly 40% of people in the U.S. who are dying
because of terminal illness are worrying about paying
for care-how their families are going to pay the medical
bills, now and after they die. No other developed
country comes close to these levels of insensitivity and
inhumanity. Meanwhile, the federal government parades
around the world as the great defender of human rights,
ignoring the fact that among the developed democratic
nations, the U.S. is the most deficient in human rights.
The basic right of access to health care in time of need
does not exist in the U.S. The United Nations Human
Rights Declaration includes this right in a prominent
position, but this is a declaration that the U.S.
Congress has never signed. It should come as no surprise
that the world's people do not believe the U.S.
government is a great defender of human rights abroad,
since it does not guarantee even basic rights at home.

And here again, things are getting worse. The percentage
of uninsured and underinsured has been increasing. The
proportion of people with employer-based health benefits
coverage declined from 67.8% among the non-elderly in
2000 to 63% in 2006-even though the economy was booming
during those years. In the same period, the number of
adults without coverage increased by 8.7 million, and
from 2004 to 2006 the number of children without
coverage increased by 1 million.

Why does this situation persist in the U.S.?

For any society, medicine is a mirror of the power
relations in that society. And nowhere is the lack of
human rights more evident than in the house of medicine.
In the U.S., insensitivity toward human needs goes hand-
in-hand with enormous profits made from that suffering.
The root of the problem, as noted earlier, is not lack
of money but the channels through which that money is
managed and spent. The problem is the privatization of
the funding of medicine that allows profits to boom. The
insurance and pharmaceutical industries enjoy the
highest rates of profit in the U.S. Just last year,
insurance industry profits reached $12 billion, and
pharmaceutical industry profits $49 billion, the highest
in the U.S. and in the world. According to Fortune
Magazine, health-related industries are among the most
profitable industries in the country. A lot of money is
being made from people's suffering. This scandalous
situation is easy to document. For example, lanzoprasol,
a gastric secretion A-reducing medicine widely used in
the U.S., costs $329 in Baltimore, U.S.A.; the same
medicine (same number of doses) costs $9 in Barcelona,
Spain! And the current Bush administration signed
legislation for a program that, in theory, covers drug
costs for elderly people, but in practice this is an
enormous rip-off. It forbids the government to negotiate
with the drug industry on the cost of drugs-that is, the
price of their products. What this means is that the
federal government pays the prices dictated by
pharmaceutical companies.

Now, one might well ask, Why does this continue? Why
hasn't our government done something about it? Is it
that the government could not provide comprehensive
health benefits coverage? It certainly could. All E.U.
governments do so. All provide publicly funded,
comprehensive health care coverage to their entire
population. And on this side of the Atlantic, Canada
(which once had a system identical to ours, health
insurers included) also provides this entitlement to all
its citizens. In Canada in the 1960s, a social
democratic government in Saskatchewan did a very logical
thing. My good friend, Dr. Samuel Wolfe, who was then
Chief Health Officer of Saskatchewan, proposed to the
province's social democratic government that rather than
paying premiums to insurance companies, people would pay
earmarked taxes to a public trust fund, controlled by
their representatives. This trust fund would negotiate
with doctors and hospitals for the payments they would
receive for the care they provided. This saved a lot of
money by bypassing the insurance companies. The
Saskatchewan Health Plan provided comprehensive care to
everyone in the province at a much lower cost than
before. Soon, the other provinces adopted similar plans,
establishing Canada's nationwide health plan that now
covers everyone. The overhead for the public system in
Canada is only 4%, compared with 30% in the U.S.
insurance industry-30% that goes to marketing,
administration (a lot of paper shuffling goes on in U.S.
health care), and the salaries of extremely well-paid
executives and insurance lobbyists. One of the best-paid
individuals in this country is William McGuire, CEO of
an insurance company-United. He makes $37 million a
year, plus $1.7 billion in stock options. And all of
this money comes from premiums paid by people, many of
whom have insufficient coverage.

The insurance companies have enormous power, both in
Washington and in most state legislatures. In Maryland,
for example, a former governor arranged for candidates
for Insurance Commissioner to be interviewed by the
insurance associations before he made his final
selection. But, insurance industry influence is
strongest in Washington. In the U.S., money is the milk
of politics. The electoral process is also privatized.
And the insurance companies pay a lot of money to
candidates. According to the Center for Responsive
Politics, the insurance industry has contributed
$525,188 to Hillary Clinton, $414,863 to Barack Obama,
and $274,724 to John McCain. As a consequence, not one
of the candidates is asking for a publicly funded
system. The major players in medical care in the U.S.-
insurance companies, drug companies, professional
associations, etc. (the list is long)-have given a lot
of money to the candidates. The splendid document called
the U.S. Constitution, which begins "We the people "
should have a footnote "and the insurance companies, the
drug companies, " The U.S. Congress is indeed the best
Congress money can buy (for a further discussion of how
money corrupts the electoral system, see my article "How
to Read the U.S. Primaries: Guide for Europeans," unch,
February 13, 2008). The privatization of the electoral
process (with most of the money that pays for campaigns
coming from economic, financial, and professional
interests, and from 30% of the nation's highest-income
earners) corrupts the democratic process. I am not
implying that politicians are corrupt (although some
are). I am willing to admit that most are honorable
persons. But the need to constantly raise funds for
their campaigns (election and re-election) corrupts the
democratic system. And the unwillingness of most members
of Congress to change this situation makes them
accomplices in that corruption. Such practices are
illegal in most democratic countries.

And people know all about this. In surveys, 68% of
people believe the U.S. Congress does not represent
their interests, but the interests of the financial and
economic groups that fund political campaigns. But the
establishments, including the political, media, and
academic establishments, want everyone to believe that
the reason we don't have a universal health program is
that people don't want it. They would like people to
believe that Congress legislates what people actually
want. Meanwhile, the long list of public policies that
people want but do not get from their government is
growing: 65% of people want a publicly funded health
care system similar to that in Canada, a system that in
academic language is called single-payer. In a single-
payer system, the government, rather than the insurance
companies, negotiates with providers-doctors, hospitals,
nurses, etc.-for the provision of medical care. We
already have a system of this type in Medicare (with an
administrative overhead of only 4%, compared with the
30% in the insurance system). By eliminating the huge
administrative expenses, we could provide comprehensive
health care coverage for everyone without spending an
extra penny.

The possibilities for major change

Obama and Clinton are ready to admit that single-payer
may be better than any other alternatives. Obama spoke
out in favor of it at one time:

"So the challenge is, how do we get federal government
to take care of this business? I happen to be a
proponent of a single payer health care program. I see
no reason why the United States of America, the
wealthiest country in the history of the world, spending
14% of its Gross National Product on health care cannot
provide basic health insurance to everybody. And that's
what Jim is talking about when he says everybody in,
nobody out."

"A single payer health care plan, a universal health
care plan. And that's what I'd like to see. And as all
of you know, we may not get there immediately. Because
first we have to take back the White House, we have to
take back the Senate, we have to take back the House."
(Barack Obama in 2003 before the Illinois AFL-CIO)

But, something happened on the way to Washington. The
train derailed. Now Obama claims that his declaration
was taken out of context. And Hillary Clinton, in 1993,
told me that while single-payer might be the most
logical model, it was politically infeasible.

I hope both candidates will reconsider. At this time,
neither candidate's proposal will resolve the health
care crisis we are facing. And in 2012, candidates will
still be talking about single mothers who cannot pay for
medical care for themselves or their children. The
candidates of 2008 should be asking for government
mandates rather than individual mandates. It is not
people who should be mandated to get insurance. It is
the government that should be mandated to provide
insurance for everyone as an entitlement.

The need to mobilize

Obama has been able to capitalize on the anti-
establishment mood in the country. And he has inspired
many. While I believe that large numbers of people-the
grassroots of the Democratic Party who support him-do
want change and are firmly anti-establishment, I am
concerned that they are putting too much faith in one
individual. Without diminishing what candidate Obama has
achieved, the fact is that he has already shown himself
to be adaptable to the political context. He was once
against the war in Iraq. But, in Congress, his votes on
Iraq have been indistinguishable from those of Hillary
Clinton. And in health care, his rather disappointing
proposal will not resolve the problems. I am very
worried that once in power, he will not have the courage
to confront the extremely powerful lobbies primarily
responsible for the lack of health care coverage and the
undercoverage of the American people. It happened with
Bill Clinton's administration and it may happen again.
Contrary to what Obama and others have said, the main
problem with Hillary Clinton's Task Force in 1993 was
not its secrecy (although secrecy was indeed a problem)
but a conceptual framework based on an insurance model-
managed care-that was pushed on the political, media,
and academic establishments by the insurance companies.
The ideologues of managed care were clearly in charge of
the Task Force. It could happen again.

To prevent this, there is a need to mobilize. History is
not made by extraordinary figures but by ordinary people
who can move mountains when they believe in a cause and
get organized. It has happened all over the world, and
it has happened in the U.S. We saw it in the
establishment of the New Deal, Social Security,
unemployment insurance, job creation, minimum wage, and
subsidized housing, among other programs. These were not
just the outcome of President Roosevelt's position, but
the result of huge social agitation and mobilization. As
usually happens in historical moments of societal
change, government leaders were not so much leading as
trying to catch up with what millions of people were
demanding. Similarly, the Great Society Programs-
Medicare, Medicaid, Environmental Protection Agency,
NIOSH, OSHA, and many other examples of progressive
legislation-were the outcome of massive mobilizations.
Candidate John Kennedy's proposals for change were
rather moderate, and his domestic policies, once he was
elected, were also disappointing. But the mobilization
triggered by his election was followed by many more,
such as Appalachian coal miners' strikes against their
working conditions, the splendid civil rights movement
led by Martin Luther King, and the antA-Vietnam War
movement led by student groups. They all established a
political climate in which progressive legislation could
occur. History, indeed, does not repeat itself. But it
offers us pointers on where to go. And it should be
obvious that change will not occur unless there is a
huge mobilization to complete the unfinished agenda of
civil rights: a full development of social rights, with
the human right to access to health care at the center.

To achieve that right, we need reforms more substantial
than those put forth by either Democratic candidate. The
splendid slogan first used by the great trade union
leader Cesar Chavez, founder of the United Farm Workers
of America, was Yes, We Can! This should guide the call
for establishing the right to health care. But, for that
to happen, the current holders of the slogan must
heighten their expectations and become more ambitious in
their proposals. This is what the electorate expects
from them in their promises of change

Dr. Vicente Navarro is Professor of Health Policy,
Public Policy, and Policy Studies at the Johns Hopkins
University. He has written extensively on economics,
health, and social policy, and has been advisor to many
governments and international agencies. His books have
been translated into many languages. He was the founder
and president of the International Association of Health
Policy, and for almost forty years has been Editor-in-
Chief of the International Journal of Health Services.
He is also a founding member of Physicians for a
National Health Program. The views expressed in this
article are his own, but are shared by millions across
the United States

_____________________________________________

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