Health Insurance Propagandist: Stick to the Status Quo

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The Buffalo News, which has taken something of a sharp turn to the right, published an “Another Voice” column penned by a health insurance broker. The conflict negates the opinion, but it deserves a fisking because it is so fundamentally dishonest. 

Literally every industrialized democracy in the world has figured out the question of how to ensure that its populace is not bankrupted by medical bills. Some, like Switzerland, rely on a tightly regulated private market where every resident is mandated to purchase a basic level of comprehensive health insurance. Some, like Germany, offer hybrid systems of state-regulated and private insurance. Some, like Britain, offer a comprehensive national single-payer system with a separate private tier of care available to those who can afford it. Some countries have a system run by the central government while others rely on state, cantonal, or provincial management. 

There exist literally myriad ways to solve the problem of paying for everyone’s health care, but the United States has failed and refused to do so, to everyone’s harm. We spend more per capita on private health insurance and derive generally worse outcomes than most of our international peer nations. 

It doesn’t matter what you call it – socialism, democratic socialism, social democracy – the idea is that everyone contributes, and everyone benefits. 

Dan Judge, the president of the “Greater Niagara Frontier Chapter of the New York Association of Health Underwriters” is certain, however, that it would be foolish to kill his job, and he’s got the scare tactics to prove it. 

As an an independent insurance broker in the field of health and employee benefits, I, along with a vast number of my insurance industry colleagues, truly understand and empathize with many of the opinions voiced lately regarding the confusion and frustration in our U.S. health care system. But that doesn’t mean we should throw it out for a single-payer, government-run system.

It is not just “confusion and frustration”, not when even the slight gains won through the Affordable Care Act, like coverage for pre-existing conditions, remains at constant peril from Republican hard-liners. While Washington lobbyists and their paid-for Congresspeople fritter away people’s coverage and health security, we have insurance underwriters desperate to explain that this idiotic, Frankenstein system of ours is worth preserving. 

Single-payer, as proposed under the New York Health Act, would completely disrupt, if not dismantle, our health care system. Mandating that all New Yorkers would be forced to give up their current coverage and be lumped into one government-controlled system would not only be an administrative nightmare, it would also have a negative impact on access to care.

Disruption of a stupid, wasteful, redundant system of multiple private bureaucracies is exactly the point. Our health insurance system is broken. Single-payer is but one option available to remedy that. If insurance brokers are scared of that, then they should propose some other solution. Scaring us with PR-tested phrases like “administrative nightmare” won’t work because any American saddled with some garbage private health insurance has at least one horror story about what a waste of time, money, and effort it is. 

Single-payer is just that – one insurer. Of course, “single-payer” could take the form of a statewide contract through RFP for handling of every medical claim by one company. It doesn’t necessarily have to be administered by a state agency. But yes, instead of paying thousands of dollars to a private insurer of some sort, it would all go to one place, and that one place would pay the bills for doctors, hospitals, testing, therapy, etc. Doctors would have only one place to go to for billing issues, rather than a cafeteria list of various and disparate private entities and coverages, each one posing a bureaucratic nightmare for physicians and staff who just want to get on with the task of treating and helping patients. 

If we look to Canada (the closest single system we have to compare to) we see what life is really like under single-payer. The libertarian Fraser Institute of Canada publishes a “Waiting Your Turn” report every year, highlighting dramatic increases in wait times for specialists and procedures. Patients wait several months just to start cancer treatment. This has an increasing number of people choosing “medical tourism,” traveling to places like New York, rather than waiting in Canada for care.

You cannot stan for a system that prioritizes insurance claim bureaucracy over patient care and then complain, ‘but muh Saskatchewan wait times’. 

Generally, taking one’s cues from a “libertarian” institute is a fool’s errand. If you don’t like Canada’s system, here’s an idea: take what works, omit what doesn’t, and improve upon it. People from Canada do not, generally speaking, travel to the United States to pay hundreds of thousands of dollars out-of-pocket to receive treatment that comes free back home. For instance, if you navigate to Kaleida’s website, it has a page dedicated to Canadian patients, inviting them to “fast-track” their procedure in Buffalo. The highlighted services are cardiovascular, orthopedics, weight loss (bariatric), general surgery & oncological surgery, neuroscience, and diagnostic services. Although “oncological surgery” is in the pull-down menu, when you click through, it offers hernia repair, laparoscopic surgery, orthopedic surgery, weight loss, gynecological, and urological surgeries. Nothing specific there about cancer. 

Not that Canada’s system is perfect; it’s not. No system is perfect, and the quest for perfection is a red herring when even a modest improvement will do. The benefit, if there exists one, of waiting this long to figure this out, is that we have so many different models from which to choose that have been implemented abroad in real life for real care for real people. Pick what works and improve upon what doesn’t. Don’t stick to the status quo – do something better. 

The NHS, by contrast, has a two-week legislated maximum wait-time for urgent cancer referrals. The biggest problems facing government-run systems is cut-backs and austerity, not the system itself. 

Much of the savings proponents of the New York Health Act point to are dependent upon major cuts to hospitals and doctors. In Erie County, nine out of the 10 hospitals would see funding decline dramatically under single-payer. Your doctor may decide the lower pay and higher taxes aren’t worth practicing in New York anymore. This will also make it harder to recruit new doctors, leading to provider shortages.

On the other hand, doctors could lay off the staff they have on hand who exist solely to navigate the various and sundry insurance schemes that do or do not pay for care, as the case may be, thus keeping more money for themselves. It’s actually a quite cynical and disgusting charge to lay upon physicians, as if money was their motivator, rather than helping sick patients. Do you think a doctor would be happier if he would get paid regardless of whom he saw as a patient, and regardless of whether there was a proper referral, etc., or if he had to maintain the status quo and deal with referrals and co-pays and collections and insurance appeals? Imagine if a doctor would never again have to turn away a patient based on ability to pay. Imagine if a patient could get the care he needed regardless of ability to pay, and not bankrupt his family in the long run. 

And then there are the massive tax increases. Analysis conducted by the RAND Corp. last year estimated that taxes would need to increase by $139 billion in the first year alone under a single-payer system; including long-term care increases this amount by an additional $43 billion in taxes. The NYHA would create the largest state tax increase in U.S. history, ballooning to more than $250 billion a year when fully implemented.

How does that compare with the money New Yorkers now pay to their private health insurers, and in co-pays and deductibles? Every single private health insurance scheme goes to pay for each company’s massive payment-related and medical approval bureaucracy. Eliminate that redundancy.

That same RAND corporation study that Judge cites actually shows a net savings to New Yorkers if this scheme is implemented. If we kept the status quo, New Yorkers would pay $311 billion for health insurance. Taxes would increase and replace that. We would save 6.5% or $20.4 billion in reduced administrative costs, 5.2% or $16.3 billion in reduced physician and hospital administrative costs, $18.6 billion or 6% in reduced prices for drugs and medical devices, totalling a savings of $55.1 billion. The increases in cost would be $17.1 billion or 5.5% to insure everyone, improved fees for providers of $8.8 billion or 2.8%, and $18 billion or 5.8% for enhancements to long-term care coverage.  New Yorkers would save $11.4 billion. 

It is literally cheaper to cover everyone. 

The bipartisan Congressional Budget Office recently determined that a national single-payer system “would significantly increase government spending and require substantial additional government resources.” Just like the RAND Corp., they also noted the possibility of less access to care while facing an increased demand that could not be met.

Yes, because money you now pay in deductibles, co-pays, and health insurance would instead go to one other place, cost less, and provide more. Call it “taxes” to scare people, but I’d rather pay a smaller sum in taxes than I do for health insurance and annual deductibles in order to have complete, comprehensive medical, vision, dental, and long term care coverage. It is a no-brainer for anyone who has any experience with the American system. 

The majority of New Yorkers – 95% – are currently covered by health insurance. (In Western New York, that number rises to 96.8%.) The state should be looking at ways to help cover the remaining 5% instead of ways to create more frustration and confusion under a single-payer health care system.

tl;dr: it’s not so much important that people have adequate health insurance, so long as the health insurance brokers can pay for another Cadillac. 

If people want to have a debate on the merits as to what sort of medical coverage scheme best works for New York or the United States, that’s fine. The status quo, both pre- and post-Obamacare is inadequate and results in literal deaths from people without adequate coverage, money to pay deductibles, and avoidance of medical care due to financial anxiety. 

Americans deserve better. Want to make America great again? Cover every American. This is how it should be: 

and

Our individualistic, libertarian paradise, however, is very different.

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