The greed of pharmaceutical and insurance companies is the
stuff of legend. There can be no justification for the huge costs that the
American people have to bear as a result. Their administrative costs and
profits alone are unconscionable and drive up the cost of health care so much
that it takes a completely self-serving and willfully ignorant Democratic
presidential candidate to disingenuously ask “how will we pay for” Medicare for
All – and we have a lot of them. The
financial cost is, however, is not the most evil part of what they do. That
would be the deaths and disability and bankruptcy that affects so many
Americans because the insurance companies deny them care and the pharmaceutical
companies make their drugs unaffordable. (This is a mild term for drugs that
can cost $30,000-$100,000 a year and more!)
I have written about these issues many times. More recently
I have also written about the role that providers (mainly hospitals and “health
systems”, but also some physicians, nursing homes, etc.) play in the
two-pronged scandal of the US health care system – too expensive and too
unavailable to too many. There are some hospitals (I include “health systems”
but will use “hospital” to avoid confusion with the “health care system”) that
are actually for-profit, but most are officially “non-profit”. This means that
they don’t have shareholders – and don’t pay taxes – but they otherwise behave
just the same, trying to make as much money as possible. They say that they
plow this back into the services that the hospitals provide, but it also
includes salaries for C-suite executives that look just as outrageous as those
in the “for-profit” sector.
More important, the “improvement” in services does not
always – or even usually – create new services that were absent from the
community previously, or make them available to more people than previously,
say the poor and uninsured. They are usually efforts to attract insured,
paying, profitable patients away from other hospitals by building a new,
fancier cancer center, or heart center, or orthopedic center. Hardly ever
pediatrics (except neonatal intensive care) or mental health – they only want
to expand those services that are big profit centers. In this way, it is
parallel to the behavior of drug companies; they prefer to minimally modify
existing big sellers to get a piece of that market (“me-too” drugs) rather than
to develop drugs to meet needs not currently being met.
It is good to see the hospitals being called out by major
health system critics. Elisabeth Rosenthal, president of Kaiser Health News,
wrote an important article on September 1, 2019 in the New York Times (where was once the health reporter) titled “That
Beloved Hospital? It’s Driving Up Health Care Costs”, in which she makes
many of the same points. She writes that
Data
shows that hospitals are by far the biggest cost in our $3.5 trillion health
care system, where spending is growing faster than gross domestic product,
inflation and wage growth. Spending on hospitals represents 44 percent of
personal expenses for the privately insured, according to Rand.
A
report this year from researchers at Yale and other universities found that
hospital prices increased a whopping 42 percent from 2007 to 2014 for inpatient
care and 25 percent for outpatient care, compared with 18 percent and 6 percent
for physicians.
The reason, of course is the political clout that the big hospitals
can buy (with, of course, our money!).The Democratic presidential candidates
are beholden (with the exception of Sens. Sanders) to both hospital
contributions and the role of big hospitals as major employers and economic
drivers. “In 2018, PACs associated with
the Greater New York Hospital Association, and individuals linked to it, gave
$4.5 million to the Democrats’ Senate Majority PAC and $1 million to their
House Majority PAC. Its chief lobbyist personally gave nearly a quarter of a
million dollars to dozens of campaigns last year.” Could this have anything
to do with why “The cost of a hospital
stay in the United States averaged $5,220 a day in 2015 — and could be as high
as over $17,000, compared with $765 in Australia”? Ya think? Ask you
politicians what they are going to do about it…
The media, including Kaiser Health News, has been running
stories on hospitals that are aggressively pursuing lawsuits against patients
who have been unable to pay their bills. On September 3, 2019, the Times ran a long piece on the poster
child for this practice, Carlsbad Medical Center in New Mexico, in “As
Patients Struggle With Bills, Hospital Sues Thousands”, but Carlsbad is by
far not the only one. The practice is most common in towns with just one
hospital, and of course, patients do not know how much they owe – or for what. It
doesn’t matter if you are insured: “Ms.
Price, 40, a nurse and local 4-H leader, has been sued five times by Carlsbad
Medical Center, for bills totaling more than $17,000….Ms. Price said she had
never received an itemized bill outlining exactly what she owed money for. The
collection agency wanted the balance in full, and she was not able to work out
a payment plan until after she was sued.”
This article names other hospitals that sue patients as a
core business practice, and mentions over 20,000 suits in Virginia. Turns out
that this was in no small part driven by the state-owned University of Virginia
hospital in Charlottesville, documented by the Washington Post and MSN in “‘UVA
has ruined us’: Health system sues thousands of patients, seizing paychecks and
putting liens on homes”. In a quick response, the Governor of Virginia and
the University vow to stop suing patients, but this has apparently not affected
those already sued: ‘“Fixing the problem
“is complicated,” in part because “we are legally obligated as a state agency
to collect debts,” he [UVA president Ryan] said. “But we have discretion within
those legal constraints to make our system more generous and more humane.”’
It also has not hurt the CEO of the hospital “…Pamela Sutton-Wallace, who will leave in November to join New
York-Presbyterian Hospital as a senior vice president”. Maybe she can teach
them to sue their patients…
Many of us have sort of emotional attachments to our local
hospitals, where we were born, or delivered our babies, or had our life-saving
surgery or other treatment; for which we raised money through bake sales and car
washes, or maybe volunteered in the gift shop. But these are not the warm fuzzy
hospitals you remember. Rosenthal acknowledges that many rural hospitals are in
financial trouble – and they are – but supporting the fantastic (“non-”) profit
of these major hospitals is not going to change that. As in every other sector
of society, we have two classes of service. One is to those in major
metropolitan areas with money or good insurance, with conditions that are
highly-profitably reimbursed, like cancer. Preferably all of the above. There is
no limit to what will be invested in them. Then there are those without money,
or good insurance, who live in rural areas, or have problems that are not well
reimbursed, like mental health or substance use. They will not get investment.
Simple as that.
Major hospitals are big businesses and act like it. You are
a customer – but, compared to other industries in which you are a customer, a
particularly uninformed one. Need a car? A refrigerator? Financial services? Dental
care in Mexico (had to get that one in)? You can find out what it will cost and
compare prices. Hospital care? In the US? You gotta be kidding.
The answer? Improved an expanded Medicare for All, a
single-payer system in which, as in Canada, hospitals get global budgets, and
separate capital budgets so that they cannot use the money (profit) they earn
on your care to build spas to attract high-paying patients from competitors.
Where everyone gets the care they need, and no one gets excessive care.
Possible? Too expensive? Ask the Canadians. Or Australians, where the average
hospital bill is less than $800. Or British, or French, or Swedish, or Danish,
or Dutch, or German, or Taiwanese….