It's all corporate now. Why do we stand for it?

"Sick. Help. That’s it!”

“John Q,” played by Denzel Washington, whose son needs a heart transplant which the insurance company has denied coverage for

 

There are still people in health care – admittedly mostly administrators and pundits and some doctors, highly-paid folks who think of themselves as “leaders” rather than “bosses” – who see the restrictions that the health insurance system places on people accessing health care as a good thing. They say that it keeps the lid on health care costs by limiting the use of “expensive and unnecessary” services by people who want “too much” of it. Luckily, for me, I no longer run into those with such views very often, and I like to think that there are fewer of them now.

These are often the same folks who supported, and continue to support, “managed care”, generally thought of as HMOs and PPOs, and their senior partner, Medicare Advantage plans (which are essentially HMOs or PPOs paid for with Medicare dollars). The techniques developed for restricting care in these plans have now been adopted by the health insurance industry overall. “Prior authorization”, which often means “delayed or denied authorization” has become one of the key strategies for restricting your access to health care services.

Restricting your access to health care is presumably not the specific intention of these practices. It would be mostly incorrect to portray health insurance executives as mean, grasping devils rubbing their hands together, like Mr. Burns, the boss in “The Simpsons”, in pleasure at your pain. They are actually mean, grasping devils rubbing their hands together in pleasure at the amount of money that they are making; your pain is incidental. I don’t know how many look like Mr. Burns.

HMOs, or what we now call HMOs, were not always money-grubbing deniers of care. Most of the early ones were consumer cooperatives (with the notable exception of Kaiser-Permanente, developed by Henry Kaiser for employees of his steel company, so he and not the insurance companies would make more money) like Group Health in Seattle, HIP in New York, and Ross-Loos in LA, designed to cut out the insurance companies so that members could get the same care for less money, or more care for the same money.  Without the profit motive in play, truly unnecessary care (sometimes that had been ordered by physicians or hospitals who stood to make money on it) could be avoided, and more necessary care provided. They often contracted with physician practice groups that were owned by the physicians themselves, rather than a corporation that violated the laws against corporate practice of medicine. Kind of vaguely socialist. Kind of good for people. Kind of quaint.

If you’re old enough, you may remember this kind of thing. In the 1980s the Reagan administration sought to expand them (naming them HMOs) as a method of cutting the cost of health care. Or, at least, cutting the costs that were expended in delivering actual health care. The plan involved encouraging insurance companies to buy up and establish their own HMOs, so it wasn’t too long before the reality of a consumer cooperative HMO was, in most places, history. Owned mostly by insurance companies, and increasingly with vertical integration, those dollars formerly “wasted” on providing “unnecessary” health care could now be turned into executive compensation and corporate profit. Some people may think this is a bad trade-off, that making money for corporations instead of providing health care for people is truly waste, but those holding such anachronistic and naïve ideas are wrong. At least in the opinion of those controlling the corporations! And their policy apologists.

This innovation was such a success (at making money) that it was expanded to a much wider base of health insurance. The old kind of insurance (often managed by the non-profit Blue Cross/Blue Shield, before they became the for-profit Anthem), that covered people for their health care needs, did not try to beat them down with denials, paid a reasonable amount to providers, and took a reasonable fee for their work, gradually became a thing of the past. These were sneered at as “Cadillac plans” (only when the beneficiaries were union members, of course not when they were executives!)  losing hold with each successive series of union contract negotiations. The executives kept their solid gold Cadillacs while union members and other employees were pushed lower and lower down until their coverage became a shadow of what it formerly was, and they often found themselves denied the care they needed and used to get.

There is a little historical irony here, in that the labor movement sowed the seeds of its own destruction by making health insurance a contract benefit. After World War II, unions in other countries fought to make health care available to all people; in Britain the party that was elected to govern actually had “Labour” in its name and introduced the National Health Service. In the US, the government instituted wage and price controls, so, unable to bargain for higher wages, unions bargained for health insurance as a way to recruit members. It was good for the members, but not so good for the nonunionized workforce. And the bosses liked it too; employer contributions to health insurance are not taxed, whereas wages are. Anyone who thinks that that such things as employer-sponsored health insurance is a “generous benefit” that is not paid for by the employee through lower wages is wrong. So, while the poor and non-unionized ended up on their own, the US labor movement got its members health insurance, often excellent health insurance. For about 30 years.

Now it’s all owned by corporations, the whole shebang. Insurance, providers groups, pharmacies, nursing homes. Many of these corporations are insurance companies, like the biggest, UnitedHealth, which also owns doctor group Optum and pharmaceutical benefit (PBM) manager OptumRx. And I am sure that, while many practices went under because they weren’t paid as a result of a major cyberattack on United subsidiary Change Healthcare, United itself is doing fine, making $8.5B in the first quarter (after all, by not paying those practices, they got to keep their money in the bank paying interest)! Other corporations are owned by private equity funds, which don’t even pretend to have any interest whatever other than maximizing their profit. Indeed, these are arguably even worse since they are sometimes happy to destroy the companies (and thus the services they provide) if that makes them the most.

The idea that a significant part of the cost of health care is overuse of services by patients would be pretty funny if it were not so serious, and for the fact that any such overuse is dwarfed by the number of people not getting adequate care, paying too much (in premiums and deductibles and co-payments and lost wages) for care, or being unable to access care altogether. That is the big problem, and as always it is the lowest income (and disproportionately minority) people who are hurt worst.

And even if you do believe that overuse is a problem, there is no conceivable way that any half-sentient, half-decent human being could possibly believe that money going to corporate and private equity profits is not waste and is a better use than providing health care to people. It is amazing that there any who do, but they include a lot of folks being paid by them – including members of Congress.

So: tell your Congressperson that YOU don’t think so, and that money appropriated for health care for people should be use for that, not raked off by insurance companies and other corporations, and it is their job to make that happen!

Controlling the cost of health care by doing the right thing

The cost of health care and ways to decrease it are a recurring drumbeat in politics, including on this blog. However, I like many others, have also emphasized the need to increase access to necessary health and medical care to all people who need it, and to create social conditions that decrease the burden of ill health. Federal efforts have finally come up with the Affordable Care Act (ACA, Obamacare), passed in 2010, and since 2012 object of continued efforts by Republicans in Congress and in those states in which they control the governor’s office and state house to repeal or gut it. In states, most effort is focused on Medicaid, which is funded by both federal and state money. In some states, most notably Oregon (“The Oregon Lottery: Far from enough, but at least they are doing something”, July 19, 2012), this effort has been combined with increasing access; in most it has just been about cutting expenditures.


On August 4, 2013 (“Why poor people choose ERs: we need a system designed to meet everyone’s needs”), I wrote about an article from Health Affairs ¹that studied the reasons that poor people use hospital emergency rooms “inappropriately” for care, to the frustration of the ERs, primary care doctors, payers (in this case, where patients were either uninsured or covered by Medicaid, mostly government) and health policy experts. The 3 major groups of reasons were quality (perceived quality, which I believe is not valid), cost (a matter not of overall cost but out-of-pocket cost to the user at the time of service) and convenience, which I argue is a misleading word for describing a place that is actually open and will see you when you can get there.  “…it is not “convenient”,” I wrote, “to wait 6 hours in an ER to be seen; if this is better than the alternative, the alternative is seriously flawed!”


What would be a mistake, however, would be to presume that it is just inappropriate use of health services by poor people that drives up the cost of care. Indeed, this is only a small part of the “excess” cost (defined as “cost in excess of what would be needed to be provide quality care to everyone) in the US. Another good definition of “excess cost” might be the additional cost per capita spent in this country compared to many other developed countries whose health outcomes are much better than ours. For this, there are different reasons. I have discussed many of them in earlier posts, and they include procedures that didn’t need to be done, over-utilization of high-technology, under-utilization of primary care, and poor geographic distribution of medical care. To a large extent, these are summarized by the two quotes I used in The high cost of US health care: it's not the colonoscopies, it's the profit”, July 28, 2013: “Using health care as a driver of corporate economics as opposed to a public good is the fundamental cause of our medical inflation,” (Richard Wender, MD) and “The US health care system is not designed to get you the care you need, it is designed to get you the care that someone can make a profit giving you.” (Lee Green, MD).


There are other causes as well. One big one, referred to above and discussed at some length in “To improve health the US must spend more on social services”, December 18, 2011, is the fact that the US does not provide anywhere near the overall social service safety net that other developed countries do. In those other countries there is much more spent to ensure that people have adequate food, housing, education, and a living wage, which are all drivers of health status.


Another big cause, though, are our preferences, our desires, as consumers, for “all that money can buy” when it comes to our health. While this may be especially true when, as health economists often point out, it is not directly your money, but your insurance company’s, I know plenty of cases in which families have wiped out their life savings, wiped out their retirement accounts, wiped out the money that could have supported the survivors (especially true when the patient was the primary breadwinner) in pursuit of “one more” vain attempt at cure. I do not mean to suggest that treatments with reasonable probabilities of meaningful benefit should be withheld. Nor do I mean to blame just the individuals and families; clearly in most of these cases there were doctors and other health professionals holding out hope (“well, maybe we could try another bone marrow transplant and it might help”) without making sufficiently clear what both what they meant by “help” and what the odds were of success.


Yet, many doctors (including me) and hospitals will tell you that they have often recommended against interventions because they have little or no likelihood of meaningful benefit, and often a significant risk of harm, only to be told by the patient and/or family that they want to “do everything”. Often these people suspect that if they had more money, or if they were a different color, or if they were in a “better” hospital, the providers wouldn’t be suggesting that they forgo further intervention. I don’t doubt that this is sometimes justified, and I’m sure that if a patient has enough money to spend there will be someone, somewhere, whether “quack” or a “legitimate” medical center, who will take it to “do something”. But this doesn’t make it right or good. I have not seen such studies but would not be surprised if it were shown that many of those with the most resources are among those with the most unpleasant deaths; our culture values intervention, and they have the money to find some who is willing to make a profit intervening.


Everyone dies. We would all like, and like for our loved ones, to live as long as possible if our lives have meaning – some physical and/or intellectual function, some ability to contribute to or benefit from others. We would like, and like for our loved ones, to be comfortable and pain-free as we approach death. We don’t want to think that money which could help us or our loved ones is being “saved” just so it can be used to provide services to others who are richer or louder. But when something will not “help” in any meaningful way that we understand it, and which may hurt, it should not be done, and we should demand that it not be done. Not doing is often more appropriate and more powerful than doing. We must shame health care providers who advertise and promulgate interventions that are unproven, or will not help, or will harm, because they can make a profit doing it.


If we are to get to this place as a society, where the US health care system is one designed to get you the care you need rather than to get you the care that someone can make a profit giving you, we are going to have to change our attitudes. And that change of attitudes and behavior needs to start at the top of the social and economic scale, not at the bottom. No unnecessary stents for President Bush, no “executive physicals”, no inappropriate end of life interventions for the wealthy. Where the “best” in healthcare is not defined as the “most”, but the most effective and most appropriate.


A health system in which health and health care for everyone is the goal of our society.

1  Kangovi S, et al., “Understanding Why Patients Of Low Socioeconomic Status Prefer Hospitals Over Ambulatory Care” , Health Aff July 2013   vol. 32  no. 7  1196-1203; doi: 10.1377/hlthaff.2012.0825