Rebuilding Healthcare Without the Middlemen
By Derrick Z. Jackson
June 13, 2009
President Obama says that if healthcare is not reformed
this year, "we're not going to get it done." His
Council of Economic Advisers warns that healthcare
expenditures, currently 18 percent of gross domestic
product, will nearly double to 34 percent by 2040
unless costs are contained. The number of uninsured
people in the
current 46 million to 72 million by 2040. "The American
healthcare system is on an unsustainable path," the
council said. "Expenditures as a share of GDP are
already substantially higher than in other developed
countries . . . This growth threatens to have a devastating impact."
Even if Congress responds to Obama's alarm, it is
doubtful reform will put us on par with other developed
countries. Obama has already taken a single-payer
system off the table, despite repeatedly acknowledging
the clear benefits of eliminating the administrative
costs of middlemen insurance companies. In a May town
starting a system from scratch, then I think that the
idea of moving towards a single-payer system could very
well make sense. That's the kind of system you have in
most industrialized countries around the world."
Alas, he says, we are so entrenched in employer-based,
insurance-company healthcare, all he can promise is
"vast improvement." He told the
"We don't want a huge disruption as we go into
healthcare reform where suddenly we're trying to
reinvent one-sixth of the economy."
Insurance companies and pharmaceuticals, the nation's
top two lobbying industries, have Capitol Hill on
lockdown. They have spent $2.8 billion since 1998 on
lobbying and $76 million in the 2008 elections in
campaign contributions, according to the Center for
Responsive Politics. Faster than you can say Obama,
contributions historically weighted heavily toward
Republicans are swinging to the Democrats.
Part of the reason obviously is that the health
industry feels the heat of American outrage on costs. A
coalition of insurance and pharmaceutical companies,
hospitals, and the American Medical Association this
week issued a plan to voluntarily knock costs down
between $1 trillion to $1.7 trillion over the next 10 years.
But that was short of a goal set by Obama of $2
trillion. It underscores how hard it will be for Obama
to get any goal line approaching universal healthcare,
with our embarrassingly bloated middleman costs. The
Economic Cooperation and Development, spends $6,714 per
capita on healthcare, double the spending in countries
$4,520, and only two other nations,
capita spending on prescription and nonprescription
drugs is $843, compared with $639 in
We might say our for-profit system is worth it if, for
all those health costs, Americans indeed boasted the
best health in the world. But it can be argued that our
system is literally costing each American two, three,
and four years of life. The
industrialized nation with life expectancy under 78
Norway, Spain, Sweden, and
expectancies between 80.3 and 82 years.
Even more striking, in the early 1960s the United
States was ahead of, or virtually tied with, Japan,
half or more behind them all.
Will reform reclaim those years, at a time when we are
compounding costs with preventable diseases, such as
the highest obesity rates in the developed world?
Reform will have to be as dramatic as the first heart
transplant, as radical as taxing junk food, and as
meaningful as making physical fitness as important as test scores.
As long as Obama and Capitol Hill say we cannot start
from scratch on healthcare, we will forever be scratching the surface.
Derrick Z. Jackson can be reached at email@example.com.
c Copyright 2009 The New York Times Company