Lancet: How to achieve universal health coverage

Warning: this study in the prestigious medical journal The Lancet is not for followers of faith-based science, or supporters of CATO, Heritage Foundation or the Family Research Council. This is for Americans who, living in the richest country on Earth, believe that universal health coverage (forget about the means for a moment) is both our common goal and moral obligation.

Here's the Summary:

Countries have reached universal health coverage by different paths and with varying health systems. Nonetheless, the trajectory toward universal health coverage regularly has three common features. The first is a political process driven by a variety of social forces to create public programmes or regulations that expand access to care, improve equity, and pool financial risks. The second is a growth in incomes and a concomitant rise in health spending, which buys more health services for more people. The third is an increase in the share of health spending that is pooled rather than paid out-of-pocket by households. This pooled share is sometimes mobilised as taxes and channelled through governments that provide or subsidise care—in other cases it is mobilised in the form of contributions to mandatory insurance schemes. The predominance of pooled spending is a necessary condition (but not sufficient) for achieving universal health coverage. This paper describes common patterns in countries that have successfully provided universal access to health care and considers how economic growth, demographics, technology, politics, and health spending have intersected to bring about this major development in public health.

Note that America meets the second criterion already, and Obamacare meets the other two. 

And here's the key take-away: 

Countries that want to achieve universal health coverage need to adopt public policies that reduce reliance on out-of-pocket spending and improve the institutions that manage pooled funding to address the equity, efficiency, and sustainability of health expenditures.

Finally, let's recognize that although government must always play a strong role, constant tinkering with the system is a hallmark of universal health coverage. Countries with universal coverage don't declare victory and call it a day:

A large government role is always an essential element in the expansion of access to care and provision of financial protection. However, the process of negotiation and compromise over health reforms leads governments to assume different roles and leads health systems institutions to take on different forms. Even in countries that have effectively universalised access to most health care, the process of debate and contestation does not end. Instead, debates continue in response to changes in economics, politics, and medical technology, as well as inequities in access that persist even in the most effective systems.

Thus, when right-wing media cite public "discontent" with universal coverage systems in countries like Britain and Canada, we must note that their public is never in favor of scrapping their system in favor of "free-market medicine," but rather reforming their existing system.  Indeed, as cited byThe Wall Street Journal, in a survey of the 10 major economies in 2008, Americans reported the lowest level of satisfaction with their health coverage.  

Political and economic aspects of the transition to universal health coverage

By Dr. William D Savedoff, et al

September 8, 2012 | The Lancet

URL: http://www.thelancet.com/journals/lancet/article/PIIS0140-6736(12)61083-6/fulltext

U.S. vets' health care massacre

Yeah, we have much more to fear from a "socialist takeover of America" than the actual consequences of our f-ed up health care "system" in the U.S.

Support Our Troops, indeed!

Study: 2,200 Vets Died Last Year Because They Lacked Health Insurance

By Alex Seitz-Wald

November 10, 2009 | Think Progress

On the eve of Veterans Day, a team of researchers from Harvard Medical School has released a study finding that an estimated 2,266 veterans under the age of 65 died last year because they did not have health insurance. That "translates to six preventable deaths per day" and more than twice the number killed in Afghanistan since the war began in 2001.

Being uninsured raises a person's odds of dying prematurely by 40 percent. The researchers found that 1.46 million veterans between the ages of 18 and 64 lacked insurance in 2008. While most veterans are eligible to receive excellent care from the Veterans Administration, those who were not injured in combat and whose income is above a certain threshold are often ineligible. Others are assigned low priorities, providing them with less consistent and more expensive access to care:

"Like other uninsured Americans, most uninsured vets are working people – too poor to afford private coverage but not poor enough to qualify for Medicaid or means-tested VA care," said Dr. Steffie Woolhandler, a professor at Harvard Medical School. [...]

Dr. David Himmelstein, the co-author of the analysis and associate professor of medicine at Harvard, commented, "On this Veterans Day we should not only honor the nearly 500 soldiers who have died this year in Iraq and Afghanistan, but also the more than 2,200 veterans who were killed by our broken health insurance system. That's six preventable deaths a day."

Unfortunately, health insurance is just one of many serious problems vets face. Up to one-in-five veterans of the wars in Iraq and Afghanistan suffers from Post Traumatic Stress Disorder, while male vets face suicide rates double the national average. And, as the VA under President Obama recognized, veterans still account for up to a quarter of all homeless.

The fact that even veterans cannot receive adequate health care demonstrates that the current system is broken and in need of dramatic overhaul. A robust public option will guarantee that vets and all working-class Americans will be able to afford quality health insurance. Still, the study's authors warn that the health care legislation "would do virtually nothing for the uninsured until 2013" and would "leave at least 17 million uninsured over the long run when reform kicks in," leaving many veterans without care.

Update Politico reports, "Senate Majority Leader Harry Reid called Sen. Tom Coburn (R-OK) 'illogical' for holding up a veterans care bill Tuesday, criticizing the Oklahoma Republican for supporting war funding while blocking health care funding for veterans.

O'Reilly flip-flops, endorses public option - DWTF?!

Ummm... alrighty then. Good for Bill O'Reilly! (Gee, I bet you never thought I'd say that).

Partial Trancript

September 16, 2009 | The O'Reilly Factor

O'REILLY: The public option now is done. We discussed this, it's not going to happen. But you say that this little marketplace that they're going to set up, whereby the federal government would subsidize insurance for some Americans, that is, in your opinion, a public option?

OWCHARENKO (Heritage Foundation - conservative think tank): Well, it has massive new federal regulation. So you don't necessarily need a public option if the federal government is going to control and regulate the type of health insurance that Americans can buy.

O'REILLY: But you know, I want that, Ms. Owcharenko. I want that. I want, not for personally for me, but for working Americans, to have a option, that if they don't like their health insurance, if it's too expensive, they can't afford it, if the government can cobble together a cheaper insurance policy that gives the same benefits, I see that as a plus for the folks.

O'Reilly endorses the public option, which he previously called 'socialism'

By Amanda Terkel

September 17, 2009 | Think Progress

URL: http://thinkprogress.org/2009/09/17/oreilly-public-option/

Forbes: So Much For Single-Payer

Like I said, Obama, our Compromiser-in-Chief, has sold us out. Max Baucus's Senate Finance Committee, which has 3 Dems and 3 Republicans, will craft what will probably be the final health reform bill passed by Congress. Obama won't push back. Single-payer, the only real way to bring down health costs, was always dead in the water. And now a public option is dead.

Obama has also flip-flopped by supporting a mandate for individuals or employers to purchase health insurance, something he opposed during his campaign while Hillary supported it.

So the bill that will be passed will be neither fish nor fowl: it won't be "liberal" enough to capitalize on the negotiating power of a large number of Americans insured through a government-sponsored, or government run, plan; and it won't be "free-market" enough to please the dreamers who still believe "unleashing consumerism" in health care is the way to bring down costs, as if the problem is that people don't shop hard enough for good deals. Those with private insurance will likely see their premiums go up, not down.

And whatever goes wrong, Obama will be blamed for it, (all five or so bills in Congress not written by Obama are collectively known, after all, as "ObamaCare"), and by extension, all the liberals who said all along this wouldn't work. That said, it may yet be an incremental improvement over the current system, we shall see.

So Much For Single-Payer

What's in the Baucus plan, what isn't and what it all means for the future of ObamaCare.

By David Whelan

September 16, 2009 | Forbes.com

URL: http://www.forbes.com/2009/09/16/obamacare-health-care-business-healthcare-baucus.html?partner=alerts

Re: Teabagger's health reform principles

Here's why this Cincy teabagger's principles for reform are wrong-headed:

"1. Move away from employer-based care - Allow consumers to pay for their own policies with pre-tax income and let the insurance companies compete for their business."

Insurance companies can compete all they want, but they are not the ones driving up costs, mainly. Indirectly, insurance companies drive up costs by their sheer numbers, requiring doctors' offices to be familiar with all of their different forms and claims procedures. Currently, almost one-third of all U.S. health care costs are caused by wasteful administration. (Meanwhile, Medicare's adminstrative costs are 2% to 5%). More insurance companies competing would mean even more administrative overhead for doctors passed on to us patients. The rising cost of medical treatment is driving up the cost of health insurance, and only doctors can prescribe care (to which insurance companies can only say yes, no or not so much).

"2. Allow insurance companies to compete across state lines - Because of individual state regulations, companies cannot compete across state lines for business."

Ditto the above. Insurance companies are not the ones driving up the cost of care. They make money by limiting treatments, and limiting or denying payment for treatments (recission), while collecting as high as possible premiums. They are not ordering more MRIs, CT scans, and longer hospital stays to drive up costs -- just the opposite.

"3. Introduce tort reform - The fear of lawsuits causes malpractice insurance to be expensive, but it also has a much greater impact to costs in the form of defensive medicine. In order to protect themselves from a potential lawsuit, doctors order more tests and procedures than they would otherwise leading to wasteful care."

Tort reform sounds nice, but let's be clear: we're talking about limiting our 1st Amendment right to petition the courts for redress of grievances. We shouldn't infringe on this right willy-nilly. Only if it's helpful, right? Well, it probably wouldn't be helpful. Even after Texas amended its Constitution in 2003 to limit malpractice damages payouts, the cost of health care in Texas continued to skyrocket: from 2000-2007, the cost of the average family health insurance policy went from $6,638 to $12,403. Furthermore, a study by the University of Alabama of 27 states with caps on malpractice payouts concluded: "Tort reforms have not led to health care cost savings for consumers." Nevertheless, despite all evidence that tort reform won't work... let's do it anyway. Just to silence the critics so that we can move on to real reform when tort reform doesn't work.

"4. Focus insurance on catastrophic care - Nobody expects their car insurance to pay for the oil change, but we expect health insurance to pay for routine visits. Catastrophic care insurance would prevent people from being financially ruined in the event something serious goes wrong."

If you try to buy health insurance as an individual, the coverage offered already is designed for "catastrophic care." You've got to pay very high deductibles before anything is covered by the insurance company, or else you've got to make a very high monthly payment, plus co-insurance, and things like maternity are not covered or cover only a fraction of the real costs.

I encourage everybody to go to the non-partisan site healthinsurance.org and search anonymously for health insurance that equals or exceeds your employer-provided insurance, just to see how much it costs. You might be surprised.

"5. Take care of the truly needy - The federal government has no business providing health care programs, but we at the state and local level have an obligation to take care of our neighbor."

What difference does it make if it's the state, local, or federal gov't providing health care? What's this "no business" business? Aren't we all Americans? How come it takes a 9/11 or a Katrina to remind us of this? He's making a statement based on ideology, not economics or pragmatism. The federal gov't should provide health insurance to the needy because it is the best equipped to do so (economies of scale); and federal assistance ensures that people who find themselves in a poor or suddenly fiscally-challenged state do not get swept under the rug of neglect. Also, state-by-state coverage of the needy could have unintended consequences: if one state is more generous in its funding of health care for the poor, then poor people might flock to that state when they get sick, thereby overloading the system. States already have to cover 50% of Medicaid costs despite many states' insolvency due to the recession.


The general problem here is that the rhetorical fallback position of many conservatives -- "competition and free markets are the cures to all our ills" -- simply doesn't apply here, because consumers often don't know in advance when/if they will need medical care; and because doctors don't prescribe care on the basis of cost, but rather on their judgment of efficacy, as they are ethically obliged to do. The result is that somebody other than the consumer is deciding what needs to be bought, when, and how much. Add to this the fact that medical treatments are often complicated, sometimes even unique, and tailored to the individual, therefore it is almost impossible to comparison shop in advance, except for the most routine of procedures. Without clear pricing you can't have an efficient market; and the nature of medicine prohibits clear pricing. Therefore we can't have a health care market.

And so we rely on HMOs or insurance companies to be the "bad guys" who say "no," or "not so much!" However, because they are for-profit or at least financially interested, we don't really trust them to make those decisions (especially when they cancel our coverage when we get seriously ill). Government is the only answer: it is not financially interested or out for profit, so we can let gov't be the bad guy who says no to unnecessary tests or prolongation of ineffective treatment. The problem is that too many Americans trust federal bureaucrats even less than for-profit insurance companies, and that is sad. Other countries do trust their government with this role and by and large, they are satisfied.

Dear Fellow Citizens and Taxpayers,

According to WLWT Channel 5, the President had 4500 attend his speech on health care yesterday at Riverbend. Be proud of yourself because this means that our Voice of America Rally outdrew the President at a 4-1 ratio. The silent majority of hard working Americans has woken up and become engaged in the political process. This is unquestionably a great thing for our country.

I watched clips of the President's speech and he again pressed the need for reform of our health care system. I agree! Our system is clearly not perfect and there is plenty of room for improvement. Unfortunately, the President lied when he said that their plan of a new government option was the only one on the table. As usual, he plays politics by saying that those who oppose his plan benefit from the status quo and are captured by special interests.

There is a kernel of truth in his words. We don't have a detailed plan. There's a reason for that - we're busy working! We do this in our spare time and we don't have time to write a 1000 page (ours wouldn't be 1000 pages anyways) alternative to the disaster that is the current bill - HR 3200. We pay our representatives to do that.

What we can do is lay out a few principles that are critical for reform to be a success:

1. Move away from employer based care - Right now, if you don't like your insurance company, the only way you can switch is to change jobs. Consumers need a choice. Allow consumers to pay for their own policies with pre-tax income and let the insurance companies compete for our business.

2. Allow insurance companies to compete across state lines - Because of individual state regulations, companies cannot compete across state lines for business.

3. Introduce tort reform - The fear of lawsuits causes malpractice insurance to be expensive, but it also has a much greater impact to costs in the form of defensive medicine. In order to protect themselves from a potential lawsuit, doctors order more tests and procedures than they would otherwise leading to wasteful care.

4. Focus insurance on catastrophic care - Nobody expects their car insurance to pay for the oil change, but we expect health insurance to pay for routine visits. Catastrophic care insurance would prevent people from being financially ruined in the event something serious goes wrong.

5. Take care of the truly needy - The federal government has no business providing health care programs, but we at the state and local level have an obligation to take care of our neighbor.
Obama Protest Yesterday

Nearly 200 patriots showed up outside of Coney Island and Riverbend yesterday to protest against the public option and in favor of free markets. The reactions of passerbys was much more positive than I expected given the high concentration of union employees. What it proved to me is that the union leadership is out of touch with their rank and file.

Some even joined us for the protest! At one point, two people headed to the AFL/CIO picnic with their family let the family go inside and grabbed signs. Another group was headed to River Downs and decided to pull over and join us as well.

The media covered us well and listened to our pro-free market message.

More to come later - I have to get to work. The next email will include more details on the trip to DC later this week.

Sincerely,
Mike Wilson
Founder/President
Cincinnati Tea Party

Forbes: Germany's health model works

Worried about a public insurance option running private insurers out of business? Read this. The two systems co-exist in Germany, with nearly equal levels of people expressing satisfaction with their coverage (84% for private, 85% for public). In fact, Germans are free to participate in public insurance and buy supplemental private insurance.

Meanwhile, Germany spends about half as much per capita on health care than we do. And they have just as many senior citizens per capita, and even more smokers.

68% of Germans said they had to wait no more than 4 weeks to see a specialist, vs. 74% in the USA.

How do they do it? They don't rely on expensive technology and ER care. Instead, they see their doctors more often and get treated often for chronic conditions. The government negotiates hard with drug companies on prices -- and has the leverage to do so. And once you're 55 you can't switch from a private to a public plan.

There is a better way.

Beyond Hysterics: The Health Care Model That Works

By Anita Raghavan

September 1, 2009 Forbes.com

As America agonizes over remaking health care, it might check out a private/public system that has been in place for years--the one in Germany.

URL: http://www.forbes.com/forbes/2009/0921/health-obama-germany-health-care-model-that-works.html?partner=alerts

Forbes: How France & Germany's health care compares

It's funny, conservative Forbes gets all the facts in the story right, but the article's sub-heading is clearly wrong. Anyway, read the article. Germany and France spend less of their GDP on health care, despite having MORE doctors per captia than in the U.S., and despite their citizens seeing a doctor almost twice as often as Americans. And without complaints of rationing or queuing.


A Health Care Journey Around Europe

By Anita Raghavan

September 2, 2009 Forbes.com

URL: http://www.forbes.com/2009/09/02/healthcare-spending-europe-business-healthcare-gdp.html?partner=alerts

JHU study: U.S. health care most expensive, with 'average' outcomes

This is what I've been saying all along: "Be entrepreneurial about looking at what works," "and then figure out why does it work for them." Then pick and choose the best from everywhere! We've already wasted so much time and energy trying to scare and enrage each other. Let's educate ourselves instead. Wake up, Amurica!

Expensive without the results: Health care in the U.S. costs the most, not the best in the world

By Michael Saul

August 23, 2009 | NY Daily News

What nation offers the best health care on the globe? Answer: Not the United States.

The U.S. health care delivery system is by far the costliest on the planet, but comparison studies consistently show Americans get second-rate results by nearly every benchmark.

"We're twice as expensive as most other industrialized countries," said Gerard Anderson, professor of health policy and management at the Bloomberg School of Public Health at Johns Hopkins University.

"But we have outcomes that are typically about average, and we're not improving as quickly as other countries are improving," he said.

Last year, a study comparing preventable deaths in 19 industrialized countries placed the U.S. dead last. France was first, followed by Japan and Australia.

In the U.S., one in three chronically ill patients says the health care system needs to be rebuilt completely. Only one in 10 feels the same way in the Netherlands and the United Kingdom.

Foes of President Obama's push for universal coverage are quick to find fault with foreign systems, and some complaints are legitimate. In Canada, for example, a typical patient seeking surgical or other therapeutic treatment had to wait 18.3 weeks in 2007, an all-time high, one study showed.

But nonpartisan, scholarly studies show that for the most part, universal systems work well. And the key numbers, from infant mortality to life expectancy, show those countries are doing something right.

"No one is suggesting that we adopt another country's health care system," said Robin Osborn, vice president and director of the international program in health policy and practice at the Commonwealth Fund, a nonprofit.

"We should be open-minded, and we should be entrepreneurial about looking at what works," she said.

Universal care has long been the norm in many countries, accepted by political parties and their followers from both the left and the right.

Of the 30 industrialized countries in the Organization for Economic Cooperation and Development, only Mexico, Turkey and the United States fail to achieve universal coverage.

"There's a solidarity that operates in these other countries in terms of social values, a sense that people are entitled to health care," Osborn said. "In these countries, the idea of someone going bankrupt because of medical bills, it just does not exist."

In the United Kingdom, for example, there is no out-of-pocket cost to see a primary care physician or a specialist. Adults can fill prescriptions, no matter how new, rare or advanced the drug, for about $12.

Australia gives high priority to promoting access to primary care physicians. Patients in the United States spend, on average, about one-third the time that Australians spend in minutes per year with their primary care doctor.

People do better in countries that encourage regular primary care visits, in part because they get frequent counsel to follow healthy habits.

Obama has pointed to the Netherlands as a model closer to what he would like here. Dutch residents are required to purchase private health insurance coverage. And insurance companies must accept every resident in their coverage area.

Other countries are also further along than the United States in using information technology and employing a team approach to manage chronic conditions and coordinate care.

"It's really valuable to look at how other countries do it," Osborn said. "The issue is to look around and see what's good and what works, and then figure out why does it work for them."

Obama caves to GOP, nixes 'public option'

See? Why were you Repugs worried about Obama? All along, it's the liberals like me who should have feared he was a corporate sellout. And now it's happened (again). Money and power did their thing. Obama caved.

So, the compromise deal will probably include state health insurance co-ops. Once those fail, and if Obama is re-elected to a second term, then we'll have another shot at real reform. If Obama isn't re-elected, then we'll have to wait another 4-8 years. So, long story short, we're talking about a four- to 10-year delay of the inevitable "public option." Meanwhile, all you Repugs get to high-five each other for enraging and scaring the crap out of America; and you can rejoice in the continued millions of uninsured and their needless, avoidable suffering. And four to 10 years from now, we liberals will get to say, "I told ya so." Gee, sounds like a great deal.

Making legislative sausage aint pretty. The sight of it can even make you sick.

White House appears ready to drop 'public option'

By Philip Elliot

August 16, 2009 | (the George Soros-funded and controlled) Associated Press

Bowing to Republican pressure and an uneasy public, President Barack Obama's administration signaled Sunday it is ready to abandon the idea of giving Americans the option of government-run insurance as part of a new health care system.

Facing mounting opposition to the overhaul, administration officials left open the chance for a compromise with Republicans that would include health insurance cooperatives instead of a government-run plan. Such a concession probably would enrage Obama's liberal supporters but could deliver a much-needed victory on a top domestic priority opposed by GOP lawmakers.

Officials from both political parties reached across the aisle in an effort to find compromises on proposals they left behind when they returned to their districts for an August recess. Obama had wanted the government to run a health insurance organization to help cover the nation's almost 50 million uninsured, but didn't include it as one of his core principles of reform.

Under a proposal by Sen. Kent Conrad, D-N.D., consumer-owned nonprofit cooperatives would sell insurance in competition with private industry, not unlike the way electric and agriculture co-ops operate, especially in rural states such as his own.

With $3 billion to $4 billion in initial support from the government, the co-ops would operate under a national structure with state affiliates, but independent of the government. They would be required to maintain the type of financial reserves that private companies are required to keep in case of unexpectedly high claims.

"I think there will be a competitor to private insurers," Sebelius said. "That's really the essential part, is you don't turn over the whole new marketplace to private insurance companies and trust them to do the right thing."

Obama's spokesman refused to say a public option was a make-or-break choice.

"What I am saying is the bottom line for this for the president is, what we have to have is choice and competition in the insurance market," White House press secretary Robert Gibbs said Sunday.

A day before, Obama appeared to hedge his bets.

"All I'm saying is, though, that the public option, whether we have it or we don't have it, is not the entirety of health care reform," Obama said at a town hall meeting in Grand Junction, Colo. "This is just one sliver of it, one aspect of it."

It's hardly the same rhetoric Obama employed during a constant, personal campaign for legislation.

"I am pleased by the progress we're making on health care reform and still believe, as I've said before, that one of the best ways to bring down costs, provide more choices and assure quality is a public option that will force the insurance companies to compete and keep them honest," Obama said in July.

Krugman: 'Obamacare' based on successfull Swiss model

The Swiss Menace

By Paul Krugman

August 16, 2009 | New York Times

It was the blooper heard round the world. In an editorial denouncing Democratic health reform plans, Investor's Business Daily tried to frighten its readers by declaring that in Britain, where the government runs health care, the handicapped physicist Stephen Hawking "wouldn't have a chance," because the National Health Service would consider his life "essentially worthless."

Professor Hawking, who was born in Britain, has lived there all his life, and has been well cared for by the National Health Service, [and is still alive! - J] was not amused.

[Investor's Business Daily is the Right's answer to Pravda. It is a total throwaway of lies and distortions. Reading it will make you dumber. Seriously. - J]

Besides being vile and stupid, however, the editorial was beside the point. Investor's Business Daily would like you to believe that Obamacare would turn America into Britain — or, rather, a dystopian fantasy version of Britain. The screamers on talk radio and Fox News would have you believe that the plan is to turn America into the Soviet Union. But the truth is that the plans on the table would, roughly speaking, turn America into Switzerland — which may be occupied by lederhosen-wearing holey-cheese eaters, but wasn't a socialist hellhole the last time I looked.

Let's talk about health care around the advanced world.

Every wealthy country other than the United States guarantees essential care to all its citizens. There are, however, wide variations in the specifics, with three main approaches taken.

In Britain, the government itself runs the hospitals and employs the doctors. We've all heard scare stories about how that works in practice; these stories are false. Like every system, the National Health Service has problems, but over all it appears to provide quite good care while spending only about 40 percent as much per person as we do. By the way, our own Veterans Health Administration, which is run somewhat like the British health service, also manages to combine quality care with low costs.

The second route to universal coverage leaves the actual delivery of health care in private hands, but the government pays most of the bills. That's how Canada and, in a more complex fashion, France do it. It's also a system familiar to most Americans, since even those of us not yet on Medicare have parents and relatives who are.

Again, you hear a lot of horror stories about such systems, most of them false. French health care is excellent. Canadians with chronic conditions are more satisfied with their system than their U.S. counterparts. And Medicare is highly popular, as evidenced by the tendency of town-hall protesters to demand that the government keep its hands off the program.

Finally, the third route to universal coverage relies on private insurance companies, using a combination of regulation and subsidies to ensure that everyone is covered. Switzerland offers the clearest example: everyone is required to buy insurance, insurers can't discriminate based on medical history or pre-existing conditions, and lower-income citizens get government help in paying for their policies.

In this country, the Massachusetts health reform more or less follows the Swiss model; costs are running higher than expected, but the reform has greatly reduced the number of uninsured. And the most common form of health insurance in America, employment-based coverage, actually has some "Swiss" aspects: to avoid making benefits taxable, employers have to follow rules that effectively rule out discrimination based on medical history and subsidize care for lower-wage workers.

So where does Obamacare fit into all this? Basically, it's a plan to Swissify America, using regulation and subsidies to ensure universal coverage.

If we were starting from scratch we probably wouldn't have chosen this route. True "socialized medicine" would undoubtedly cost less, and a straightforward extension of Medicare-type coverage to all Americans would probably be cheaper than a Swiss-style system. That's why I and others believe that a true public option competing with private insurers is extremely important: otherwise, rising costs could all too easily undermine the whole effort.

But a Swiss-style system of universal coverage would be a vast improvement on what we have now. And we already know that such systems work.

So we can do this. At this point, all that stands in the way of universal health care in America are the greed of the medical-industrial complex, the lies of the right-wing propaganda machine, and the gullibility of voters who believe those lies.

Reich: Why We Need a Public Option

Why We Need a Public Health-Care Plan

By Robert Reich

June 24, 2009 | Wall Street Journal

Why has health-care reform stalled in Congress? Democrats, after all, control both Houses, and President Obama, whose popularity remains high, has made universal health care his No. 1 priority. What's more, an overwhelming majority of the public wants it. In the most recent Wall Street Journal/NBC News poll, 76% of respondents said it was important that Americans have a choice between a public and private health-insurance plan. In last week's New York Times/CBSNews poll, 85% said they wanted major health-care reforms.

So why the stall? Mainly because Congress can't decide how to pay for it. The hardest blow came last week when the Congressional Budget Office (CBO) estimated that the trial-balloon bill emerging from the Senate Health Committee would cost a whopping $1 trillion over 10 years and would cover only a fraction of Americans currently without health care. According to the CBO, another tentative bill, this one coming out of the Senate Finance Committee, would cost even more -- $1.6 trillion.

That spells political trouble. Republicans who never batted an eye over George W. Bush's wild spending habits have become born-again fiscal hawks. Blue Dog Democrats are nervous about mounting deficits. Even the president admits that the flow of red ink in future budgets keeps him up at night.

No one wants to raise taxes or even be accused of thinking about the subject. But honest politicians have to admit that universal health care will require additional revenues. The likeliest sources are limits on certain tax deductions and a cap on tax-free employer-provided health care. Would the public go along? The most intriguing finding in last week's New York Times/CBS poll was that most respondents said they would be willing to pay higher taxes to ensure everyone had health insurance.

But before we even get to this point, it's important to recognize that those terrifying CBO cost projections significantly overstate the costs. They did not include potential cost savings from the lynchpin of health-care cost containment: a so-called public option that would give people who don't get health care from their employer the choice of a public insurance plan. Why? For the simple reason that the Senate committees hadn't yet agreed on a public option. Yet without a public option, the other parties that comprise America's non-system of health care -- private insurers, doctors, hospitals, drug companies, and medical suppliers -- have little or no incentive to supply high-quality care at a lower cost than they do now.

Which is precisely why the public option has become such a lightening rod. The American Medical Association is dead-set against it, Big Pharma rejects it out of hand, and the biggest insurance companies won't consider it. No other issue in the current health-care debate is as fiercely opposed by the medical establishment and their lobbies now swarming over Capitol Hill. Of course, they don't want it. A public option would squeeze their profits and force them to undertake major reforms. That's the whole point.

Critics say the public option is really a Trojan horse for a government takeover of all of health insurance. But nothing could be further from the truth. It's an option. No one has to choose it. Individuals and families will merely be invited to compare costs and outcomes. Presumably they will choose the public plan only if it offers them and their families the best deal -- more and better health care for less.

Private insurers say a public option would have an unfair advantage in achieving this goal. Being the one public plan, it will have large economies of scale that will enable it to negotiate more favorable terms with pharmaceutical companies and other providers. But why, exactly, is this unfair? Isn't the whole point of cost containment to provide the public with health care on more favorable terms? If the public plan negotiates better terms -- thereby demonstrating that drug companies and other providers can meet them -- private plans could seek similar deals.

But, say the critics, the public plan starts off with an unfair advantage because it's likely to have lower administrative costs. That may be true -- Medicare's administrative costs per enrollee are a small fraction of typical private insurance costs -- but here again, why exactly is this unfair? Isn't one of the goals of health-care cost containment to lower administrative costs? If the public option pushes private plans to trim their bureaucracies and become more efficient, that's fine.

Critics complain that a public plan has an inherent advantage over private plans because the public won't have to show profits. But plenty of private plans are already not-for-profit. And if nonprofit plans can offer high-quality health care more cheaply than for-profit plans, why should for-profit plans be coddled? The public plan would merely force profit-making private plans to take whatever steps were necessary to become more competitive. Once again, that's a plus.

Critics charge that the public plan will be subsidized by the government. Here they have their facts wrong. Under every plan that's being discussed on Capitol Hill, subsidies go to individuals and families who need them in order to afford health care, not to a public plan. Individuals and families use the subsidies to shop for the best care they can find. They're free to choose the public plan, but that's only one option. They could take their subsidy and buy a private plan just as easily. Legislation should also make crystal clear that the public plan, for its part, may not dip into general revenues to cover its costs. It must pay for itself. And any government entity that oversees the health-insurance pool or acts as referee in setting ground rules for all plans must not favor the public plan.

Finally, critics say that because of its breadth and national reach, the public plan will be able to collect and analyze patient information on a large scale to discover the best ways to improve care. The public plan might even allow clinicians who form accountable-care organizations to keep a portion of the savings they generate. Those opposed to a public option ask how private plans can ever compete with all this. The answer is they can and should. It's the only way we have a prayer of taming health-care costs. But here's some good news for the private plans. The information gleaned by the public plan about best practices will be made available to the private plans as they try to achieve the same or better outputs.

As a practical matter, the choice people make between private plans and a public one is likely to function as a check on both. Such competition will encourage private plans to do better -- offering more value at less cost. At the same time, it will encourage the public plan to be as flexible as possible. In this way, private and public plans will offer one another benchmarks of what's possible and desirable.

Mr. Obama says he wants a public plan. But the strength of the opposition to it, along with his own commitment to making the emerging bill "bipartisan," is leading toward some oddball compromises. One would substitute nonprofit health insurance cooperatives for a public plan. But such cooperatives would lack the scale and authority to negotiate lower rates with drug companies and other providers, collect wide data on outcomes, or effect major change in the system.

Another emerging compromise is to hold off on a public option altogether unless or until private insurers fail to meet some targets for expanding coverage and lowering health-care costs years from now. But without a public option from the start, private insurers won't have the incentives or system-wide model they need to reach these targets. And in politics, years from now usually means never.

To get health care moving again in Congress, the president will have to be clear about how to deal with its costs and whether and how a public plan is to be included as an option. The two are intimately related. Enough talk. He should come out swinging for the public option.