- ‘The right to health care is recognized in international law and guaranteed in the constitutions of many nations. With the exception of the United States, all Western industrialized countries regardless of how they raise funds, organize care, and determine eligibility, guarantee every citizen comprehensive coverage for essential health care services. To the extent that care is rationed, it is done on the basis of clinical need, not ability to pay.’ (2)
- ‘In every case [of other countries], however, the practices of insurance companies are heavily regulated to prevent them from engaging in the more pernicious forms of medical underwriting that are commonly employed in the United States. Medical underwriting is the practice health plans use to segment people and employee groups into different risk pools according to their health profile.’ (2-3)
- ‘In 2003 45 million Americans, more than one out of every six people, had no health insurance. That number, as large as it is, tells an incomplete and potentially misleading story, because many more people are uninsured for some period over any two-year time span. In 2002 and 2003 nearly 82 million people – one out of every three Americans – went without health insurance for all or part of the two years. Most were average people in working families. Nearly eight out of ten were working, and another 6 percent were looking for work. Only 15 percent were not in the labor force, in most cases because they were disabled, chronically ill, or family caregivers.’ (3)
- ‘In 2003 employers contributed 73 percent of the cost of family health benefits with employers paying the remainder, at an average cost of $2,412. While $2,412 sounds like a good deal (and indeed it is), it represents 25 percent of the income for someone working full time at minimum wage ($51.15 an hour in 2004).’ (4)
- ‘The uninsured, such as Jesus [Vivas], are often denied care that is available to people with insurance. Many uninsured people do not have a regular family doctor and thus do not receive preventive health services such as cholesterol-lowering drugs or screening for potentially fatal diseases such as cancer, diabetes, or heart disease. As a result, their health problems are often diagnosed at more advanced stages, resulting in higher mortality rates. Frequently they care they do receive is in an emergency room where there is no primary care and no follow-up care. Uninsured children are less likely to have a pediatrician who provides regular care or to receive basic immunizations, and they are more likely to be hospitalized for an illness that could have been treated without a hospitalization. Being uninsured can place severe financial strains on families. Nearly half of all individual bankruptcy filings are due to medical bills.’ (4-5)
- ‘Why is the United States the only nation that fails to guarantee coverage of medical services, that rations care by income, race, and health, and that allows for-profit private insurance companies to serve as gatekeepers to the health care system?... Current arrangements for financing care have been hammered out through contentious struggles between social reformers, physicians, employers, insurance companies, and trade unions over the proper relationship between government and the private sector. Across an entire century, each attempt to enact national health insurance has been met with a fierce attack by powerful stakeholders who have mobilized their considerable resources to keep the financing of health care a private affair. Whenever government action has seemed imminent, they have lobbied legislators, influenced elections by giving huge campaign contributions to sympathetic candidates, and organized ‘grassroots’ protests, conspiring with other like-minded groups to defeat reform efforts. The only instance where this was not the case was with Medicare and Medicaid, programs that fund care for the residual population groups – the aged and the very poor – that private insurers have no desire to cover.’ (5-6)
- ‘From the Progressive Era to the 1960s, physicians were the most vocal opponents of government-financed health care. Their goal was to erect a barrier against any third-party payer, especially the government, that might intrude in the sacred doctor-patient relationship.’ (6)
- ‘Initial forays into the providers’ domain were followed by attempts, first by President Richard Nixon and then by President Jimmy Carter, to control hospital costs. Carter’s first plan, to set a yearly cap on hospital cost increases, sparked a flurry of lobbying activity by the American Hospital Association and the Federation of American Hospitals.’ (9-10)
- ‘Then corporations turned to managed care, unleashing a powerful adversary whose sole objective was to tame the health care system. Managed care firms delved deeply into the most minute details of physicians’ practices. They reviewed tests and procedures, evaluated charges, analyzed patient records to see if unnecessary procedures were being performed, and then held physicians financially accountable for the costs of their medical decisions. Thus, ironically, the private health insurance system that physicians had helped to construct became a mechanism for undermining their sovereign rule.’ (10-11)
- ‘When President Bill Clinton proposed a plan to guarantee universal health care coverage in 1992, the same coalition of insurers, corporations, and small-business groups mobilized against him.’ (11)
- ‘I argue that the reason we don’t have the health care system we need is not because the solution is too difficult to grasp or because of the legacies of antistatism, racial politics, or something inherent in the American political system. The reason we don’t have the system we need is because we have failed to grasp how much we have ceded our health care to private interests.’ (16)
- ‘The Red Scare’s lasting legacy was a suspicion of socialist sympathies attached to any group looking to alleviate social problems through government action.’ (18)
- ‘Socialism stood in contrast to Progressivism, the spirit of reform that swept the nation between the 1890s and the end of the First World War. Progressivism was inspired by the same problems that gave rise to socialism – harsh working conditions, unemployment, urban poverty, and labor unrest – but the remedies were reformist rather than revolutionary.’ (18)
- ‘Whereas socialists believed that the existing government was a tool of capitalists, progressives were convinced that public power could be used to protect the common welfare. They sponsored state laws for minimum wages, an eight-hour workday, old-age pensions, insurance against industrial accidents, and limits on the working hours of women and children.’ (18)
- ‘The stock market crash of 1929 sent the economy into a tailspin, ushering in an economic crisis of unprecedented magnitude. As the Depression deepened, hospital occupancy rates dropped steeply, because most people had no way to pay for medical care. Some hospitals, seeking a way to develop a stable source of revenue, set up prepayment ‘service’ plans where members would pay a monthly fee and then be eligible for free hospital services if they needed care. These plans initially covered such as teachers and firefighters. Although the AMA thundered against them, the American Hospital Association (AHA) helped hospitals establish these group plans and succeeded in resuming many floundering community hospitals. Prepayment plans became the precursor to what would become Blue Cross.’ (22)
- ‘Worried about jeopardizing his entire Social Security bill, Roosevelt decided to put national health insurance on hold. As a result, the Social Security Act of 1935, the largest expansion of federal authority into the social welfare system in American history, created new programs for the unemployed, the aged, widows, single mothers, and poor children but did not include national health insurance.’ (23)
- ‘the Internal Revenue Service, following the precedent accepted by the states, exempted Blue Cross plans from federal income taxes as well. These arrangements allowed Blue Cross plans to grow unimpeded by competition from commercial insurance companies. Blue Cross thus stabilized the flow of income to hospitals and gave the AHA a virtual monopoly over health care financing in most communities. Blue Cross plans were able to achieve these tax advantages because they differed from commercial insurance in two key ways. First, they were ‘community-rated,’ meaning that everyone who belonged to the group paid the same rate and received the same benefits, regardless of age or health status. By contrast, commercial insurance plans were ‘experience-rated,’ with rates determined by the perceived risk factors of the group or individual. A second difference was that Blue Cross offered service benefits that provided subscribers with free hospital care when needed, while commercial insurers offered indemnity plans that reimbursed patients a fixed amount for expenses incurred during a hospital stay. For these reasons, Blue Cross could serve the community in ways commercial insurance could not.’ (23-24)
- ‘After Blue Cross was formed, the unions worked to formalize agreements to cover their members’ health expenses. From the unions’ perspective, Blue Cross was preferable to commercial insurance, because it was nonprofit, it was community-rated, and it offered full benefits with no deductibles or co-payments.’ (24)
- ‘Now, having served as vice president for less than four months, Truman faced the daunting task of calming the fears of a bereaved nations and converting an economy mobilized for war to peacetime purposes. On September 5, 1945 , President Truman delivered a message to Congress outlining his Fair Deal, an ambitious plan to expand Social Security benefits, raise the minimum wage, build public housing, clear slums, and improve health care… His Fair Deal was to fund hospital construction, provide grants to states for public health, and create a national health insurance program.’ (27)
- ‘All you have to do is give it a bad name, and have a Devil. America Ewing is a perfect devil and we’re going to give him the works.’ Clem Whitaker, California
- ‘If anybody, like a surgeon whose ability to support his family depends entirely on the referrals that he gets from the other physicians in the county medical society, this lifeblood can be shut off very effectively by physicians who…will find a reason never to refer a patient to you, simply because you don’t follow the party line. And this goes for your social life in the community where you’re really ostracized by the other people in your medical profession, and it also goes for the way your kids are handled in school…. For somebody who depends on referrals, the economic sanctions that can be lowered by organized medicine are tremendous.’ Dr. Caldwell Esselstyn (36)
- ‘In 1945 75 percent of Americans supported national health insurance; by 1949 only 21 percent favored President Truman’s plan.’ (38)
- ‘During the campaign the AMA drew heavily upon physicians’ cultural authority as experts on health issues. By the end of the decade, the abuse of this authority for such blatantly selfish ends made the public increasingly critical of the AMA, perceiving it as a negative organization that was against everything. The AMA had opposed aid to medical schools on the grounds that federal aid would lead to federal control.’ (40)
- ‘Oscar Ewing awarded the doctors’ lobby first prize among business lobbies for spending $353,990 during the first nine months of 1948.’ (41)
- ‘He won the election, becoming the first Republican president after two decades of Democratic rule, and his victory was widely interpreted as a referendum against national health insurance. During the eight subsequent years of Republican administration, national health insurance disappeared from the political agenda.’ (43)
- ‘Miners had the highest rates of tuberculosis, pneumonia, and black lung disease. Over the course of the 35 years from 1910 to 1945, more than 2 million men had been mangled in the mines, and 68,842 had been killed.’ (48)
- ‘The United Mine Workers set a precedent that other unions quickly followed. From 1940 to 1966 the number of people with insurance against the costs of medical care increased from 6 million to more than 75 million, with most of the growth occurring through trade union action.’ (49)
- ‘By 1960 the AMA had 950 people working on political issues, with 75 percent of their time devoted to health legislation.’ (59)
- ‘In 1958 260 commercial insurance companies joined together to form the Health Insurance Association of America to counter the efforts of the AFL-CIO. According to Ellickson, the insurance companies ‘provided the technical attacks of costs’.’ (61)
- ‘Great Society would increase funding for education, child health, nutrition, job training, and community action. The capstone would be health insurance for the elderly.’ (70)
- ‘In the 1964 election, Barry Goldwater, a conservative Arizona
- ‘Commercial insurance companies had become resigned to the need for a government program. The aged had proved to be unprofitable clients, forcing insurers to load their costs onto paying customers.’ (72)
- ‘While I was working with the Congress…there was a total change of attitude toward the medical profession…. Part of the psychology of a physician is that he is used to being a very strong authoritarian figure to his patients and a father figure to them…he can be authoritarian and still have a conviction that he’s doing it for their own good and he can’t understand anybody who deliberately goes against him in the doctor-patient relationship. Now in the early period of this battle, it seems to me that the AMA was approaching the Congressmen very much in the same spirit…. But over the years…this was no longer effective…. It was more of a discrediting of the medical profession. It was really a puncturing of this aura of omniscience.’ Elizabeth Wickenden (73)
- ‘In an effort to prevent deadlock, Mills decided to combine the three approaches – the AFL-CIO hospital insurance plan, the AMA’s Eldercare, and Aetna’s Bettercare – in one bill, his ‘three-layer cake.’ According to Robert Ball, everyone in the room was ‘flabbergasted’. The first layer, Medicare Part A, would pay for hospital care, for skilled nursing care for a limited period, and for some health care for people recovering from an illness. Part A would not pay for any long-term nursing home care for people with chronic illnesses, a deficiency that would prove to be a big problem in years to come. The second layer was Part B, an optional program that would pay for physicians’ services. The third layer was a slightly expanded version of Kerr-Mills termed Medicaid, a program of health insurance for people who were ‘categorically’ eligible for the federal/state cash assistance programs, old-age assistance, and Aid to Families with Dependent Children, the plan favored by the AMA and some conservatives.’ (73-74)
- ‘Medicare was enacted on July 30, 1965 , the largest expansion of the welfare state in the second half of the twentieth century.’ (75)
- ‘Medicare was a turning point for the medical profession. It resulted in the loss of key allies, including the AHA, the Blue Cross Association, and the insurance industry. It also undermined physicians’ cultural authority, as the AMA developed a ‘reputation for intolerance’.’ (75)
- ‘During the 1940s, the American trade unions followed a different course than their European counterparts. Instead of working on behalf of national health insurance, they focused their energies on the right to bargain for fringe benefits in their employment contracts. As a result, there was no labor-sponsored, grassroots initiative to counter the AMA or the commercial and nonprofit insurers, for whom collectively bargained health benefits had opened a large new market of viable employee group insurance pools.’ (76)
- ‘The AFL-CIO won Medicare by mobilizing its extensive union network of state federations and local chapters, organizing a grassroots senior citizens’ movements, and supporting Democratic Party members who served on key congressional committees. Although union leaders were subsequently pushed to the sidelines during Lyndon Johnson’s Great Society, there is little doubt that the trade unions paved the way for the final Medicare vote. The 20-year period between the end of World War II and the enactment of Medicare in 1965 solidified the private health insurance system in several ways. The spread of private health insurance in collective bargaining agreements effectively removed organized labor from the broader struggle for national health insurance and gave the trade unions a vested interest in the private welfare state. Medicare further reinforced private health insurance by providing coverage for a costly group and removing from political debates over national health insurance a constituency considered worth and deserving.’ (76)
- ‘At the state level, the ‘separate but equal’ principle was protected by harsh racial codes mandating racial segregation; at the national level, southern congressmen insisted on the primacy of states’ rights and used their control over key congressional committees to block any measures that might allow federal authorities to intervene in local racial practices. Racial discrimination was as rampant in the health care system as in other southern institutions. Some southern hospitals refused to admit any block patients. Others maintained separate ‘white’ and ‘colored’ entrances, water coolers, and bathrooms and reserved certain wards and rooms for black patients only. Segregation also extended to hospital personnel practices, as black physicians were excluded from local medical societies and denied hospital staff privileges.’ (77-78)
- ‘The school desegregation decision did not relieve the Public Health Service of its responsibility to carry out the Burton-Hill statue as written, even if that meant allowing segregated facilities to continue current practices.’ (80)
- ‘Until 1963, court decisions continued to uphold the principle that the equal protection clause of the Fourteenth Amendment did not apply to private institutions. These claims were finally overturned in the case of Simkins v. Moses H. Cone Memorial Hospital.’ (83)
- ‘When Congress enacted the Civil Rights Act of 1964, the watershed racial legislation of the century, the Powell amendment became Title VI. Title VI stated that ‘no person in the United States shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subject to discrimination under any program receiving federal assistance.’ (85)
- ‘Despite their misgivings about federal intervention in the practice of medicine, most doctors willingly complied with Medicare [sic] they would be guaranteed payment for treating the elderly, a service they had often performed free.’ (90)
- ‘Most hospitals were eager to be approved so that they could begin receiving federal funds. Although they ‘wanted no part of being watched over by the federal government,’ they ‘wanted in because of the financial rewards offered.’ ’ (90)
- ‘For two-thirds of a century, southern politicians had resisted national health insurance for fear that federal financing of health care services would lead to federal monitoring of racial practices. Their agenda was compatible with the desires of physicians, who had their own reasons for opposing government intervention in the health care system. Medicare realized these fears by requiring hospitals to provide health care services without regard to race.’ (93)
- ‘In investigating charges of discrimination, however, federal officials delved into every aspect of hospital operations, from patient room assignments to physician referral networks. Thus the dismantling of racial segregation also allowed federal officials to monitor internal hospital affairs, penetrating the barrier between providers and the federal government and undermining provider sovereignty in the pursuit of racial justice.’ (93)
- ‘Medicare had to be operating by July 1, 1966 … The first task was to win over the AMA, whose cooperation would be crucial to Medicare’s success. On July 3 President Lyndon Johnson agreed to meet with AMA officials who had come to complain about socialized medicine. A man of electrifying energy who could be both compassionate and cruel, Johnson was a consummate politician with an ‘uncanny instinct for the jugular of his adversaries.’ As the doctors sat around the table, waiting politely for the president to speak, Johnson gave them the ‘treatment.’ He first told the assembled physicians, ‘Your country needs your help. Your President needs your help.’ Would they be willing to serve in Vietnam August 12, 1965 , the Association of American Physicians and surgeons published a New York Times op-ed piece telling physicians to boycott Medicare.’ (94-95)
- ‘Over the objections of the SSA, the for-profit nursing home industry lobbied Congress and won support for an amendment allowing private nursing homes to be reimbursed for these allowable charges plus a 7.5 percent profit, which they argued was a ‘reasonable return on equity capital investment.’ Then for-profit hospitals and nonprofit nursing homes began demanding the same return on their Medicare patients.’ (98)
- ‘In 1965 alone hospital daily charges jumped 16.5 percent, and between 1967 and 1973 Blue Cross administrative costs for Medicare Part A increased 201 percent. Inflation in health care costs was also triggered by hospital supply companies that charged hospitals five times the regular price for such items as scissors, tape measures, and furniture. Investment analysts began telling clients that hospital supplies were a good investment because they were recession-proof. Actuary Robert Myers decried this ‘intolerable and deliberate’ draining of the Medicare trust fund, to no avail.’ (99)
- ‘In the past, physicians had often charged what they thought a patient could pay. With Medicare they abandoned this practice and charged indigent patients the same as more affluent patients. Dr. Brendan Mylans defended this practice: ‘I do not represent the ultra-conservative nit-wit branch of the American Medical Association…. However, in all fairness one must point out that…most physicians…even the most grasping, have treated some patients for nothing, or for a nominal sum…. However, now that the Government has assumed financial responsibility for the medical care of these patients, it is hardly fair to ask physicians to donate their services to the Government.’ ’ (100-101)
- ‘There were also legitimate reasons for costs to ruse, as many older patients were now receiving medical care that they hadn’t been able to afford previously.’ (101)
- ‘The entirely predictable result was that average fees for office visits immediately shot up. General practitioners’ fees rose 25 percent, internists’ 40 percent. Yet the fees of pediatricians, who treated children and thus had no Medicare, remained constant. As one physician admitted: ‘No health care program has ever strained the ethics of the medical profession as Medicare is doing. The temptation to chisel is enormous….I’ll admit that I try to take as much Medicare money from Uncle Sam as I possibly can. From what I’ve seen and heard, a lot of other doctors are doing the same....Before Medicare I individualized the fee on every case….Those days are gone forever. Now with Medicare patients, we doctors charge our ‘usual fee’ for everything.’ With hospitals reimbursed for whatever they charged plus 2 percent, physicians paid their ‘customary’ fees, suppliers totally unregulated, extended care facilities guaranteed 7.5 percent profits, a stepped-up demand for services, and insurance companies simply accommodating, there was neither the will nor the mechanism to contain costs.’ (102)
- ‘By the end of the 1960s, the costs of the war in Vietnam and rising prices for energy and health care had created record budget deficits and inflation, ending two decades of economic growth and close to balanced budgets. As the country’s economic woes mounted, the health care system came under intense scrutiny for encouraging waste and inefficiency.’ (104)
- ‘Some concerted government response was required. The question was what form it would take. Although Nixon was a firm believer in the free market and ideologically opposed to wage or price controls, his economic advisors convinced him that inflationary pressures would continue to mount unless the government intervened in the wage- and price-setting process. Early in 1971 Nixon announced his New Economic Policy.’ (105)
- ‘Some formal apparatus had to be established to monitor health care costs permanently.’ (106)
- ‘Under Medicare the federal government poured virtually unlimited public resources into financing care for the aged and the poor, turning health care into a profitable enterprise for physicians, hospitals, and insurance companies. As what had been largely a charitable, ostensibly noncommercial enterprise became a growth industry, costs skyrocketed.’ (108)
- ‘Goldbeck [head of the Washington Business Group] felt that is all employers were required by law to provide health benefits for their employees, it would help level the playing field between those employers who provided generous health benefits for employees and also subsidized their dependents and those who provided no insurance coverage.’ [Same as Nixon’s plan] (115)
- ‘The Health Maintenance Organization and Resources Development Act of 1973 authorized $375 million in planning grants and loans to encourage the development of new HMOs. It also required companies that had 25 or more employees and that provided health insurance to offer an HMO option.’ (117)
- ‘By the end of the year, Nixon’s support of legislation in Congress had dropped to the lowest point of any president recorded. On 310 legislative votes taken that year, the White House won only 51 percent.’ (120)
- ‘Price increases ordered by OPEC caused oil prices to rise 350 percent in 1973.’ (120)
- ‘During Ford’s brief tenure in office, the economy continued its tailspin with negative economic growth, inflation close to 12 percent and rising, and unemployment over 7 percent. The stalling economy forced Ford to retreat from his commitment to national health insurance. By the end of the year, the campaign to whip inflation dominated.’ (123)
- ‘Investor-owned hospitals had expanded rapidly since Medicare had made hospitals such lucrative enterprises, and they were the biggest beneficiaries of inflation in the hospital sector. In just one year, from 1977 to 1978, the Hospital Corporation of American’s profits rose 23.4 percent, the Medicore Company’s 25.3 percent, and American Medical International’s 52.3 percent. The Federation of American Hospitals, which represented for-profit hospitals, made hefty contributions to members of Congress who served on the committees that had jurisdiction over the measure, invited elected officials to speak before the group’s convention, and featured interviews with favored politicians in its monthly magazine.’ (125)
- ‘The core idea of supply-siders was that tax cuts would generate economic growth. Reagan kept his promise to reduce taxes, which instead of eliminating inflation tripled the national debt and ushered in a recession. He also kept his promise to reduce government spending. In his 1981 budget he eliminated the public service jobs program, cut 400,000 people from the food stamps program, reduced the federal subsidy for public housing residents, eliminated the minimum Social Security benefit, and ended benefits for older children of deceased workers.’ (132-133)
- ‘Since the late 1970s the Social security trust fund had been teetering toward bankruptcy. In 1981 new projections indicated that there would be insufficient funds to pay benefits in just a few years. To restore Social Security to solvency, President Reagan proposed an immediate cut of 31 percent in early retirement benefits (which would hit people ages 62 to 65) and a 10 percent cut in future benefits, even though polls showed that 65 percent of the public opposed further reductions in health and social welfare programs and even though more than 60 million people would be directly affected by the proposals…Within days Reagan’s public approval rating plummeted by 16 points…That October, Congress restored the minimum Social Security Benefit, promising never again to reduce benefits for current recipients, and Reagan abandoned all plans for benefit cuts in the near term. Instead, he created the bipartisan National Commission on Social Security Reform to devise a politically feasible, long-range solution.’ (133-134)
- ‘When the government proposed a 16 percent [Medicare] reduction in 1991, the AMA and other physicians’ organizations created such a ‘firestorm of protest’ that the regulation was revised.’ (138)
- ‘In the 1980s, corporations decided it was time to use their purchasing power to challenge the providers’ dominance over the health care system.’ (140)
- ‘Ever effort to cut Medicare payments translated into an increase in corporate costs. These trends affected small employers differently than large employers.’ (140)
- ‘As health insurance became less affordable for small-business owners, they began curtailing benefits or dumping their employee health care coverage entirely.’ (141)
- ‘In some states Blue Cross began selling stock and branching into the more lucrative life insurance businesses. In recognition of the changed practices of the organization, in 1986 Congress removed Blue Cross’ nonprofit tax exemption, ending its pretense of being a charitable community service organization.’ (142)
- ‘Self-insured firms also were exempt from state laws that regulated insurance companies and thus were free from liability in state court if their decisions regarding benefits harmed the people they insured. What that meant was that patients could not sue if the company withheld payment for any health problem.’ (142)
- ‘In 1975, the year after ERISA [Employment Retirement Security Act of 1974] was enacted, only 5 percent of employees were covered by self-insured plans, mainly those negotiated by labor unions; by 1985 that figure had climbed to 42 percent. By the mid-1990s self-insurance covered nearly half of all workers and a much higher percentage of employees of large companies. Employers, not insurance companies, had become the leading risk bearers.’ (142)
- ‘The first retiree health benefits had been granted in 1953, when the Big Three auto manufacturers…agreed to provide retirees age 65 and older the same health benefits as active workers.’ (148)
- ‘Congressional hearings were held, and Fortune magazine warned that retiree health benefits were ‘unfunded, out of control and growing more than twice as fast as inflation.’ ’ (149)
- ‘Not only had retiree health benefits become a huge business expense, they threatened to undermine investor confidence. As corporations sought a way to shed this responsibility, they seized upon a proposal to expand Medicare to cover many of these costs.’ (149)
- ‘On July 1, 1988 , Congress passed the Medicare Catastrophic Coverage Act with huge bipartisan majorities in both House and Senate.’ (155)
- ‘On October 4, 1989, in an unprecedented move, the House voted to repeal the program it had approved just 16 months earlier.’ (158)
- ‘While some older people experiences short-term gains from the repeal of the Medicare Catastrophic Coverage Act, the long-term consequence was the loss of a fully financed prescription drug benefit and erosion of benefits for future retirees.’ (158)
- ‘In 2000 the Third Circuit Court of Appeals ruled that retirees who are eligible for Medicare could have a valid claim of age discrimination under the Age Discrimination in Employment Act if their employers provide them with coverage inferior to that offered to younger retirees…In light of this decision more employers concluded that it was safer to eliminate retiree health benefits entirely than to risk being sued for age discrimination.’ (159)
- ‘The retreat from fee-for-service occurred rapidly. Between 1983 and 1994 the number of physicians employed in group practices, HMOs, and other organization settings grew from 23 percent to 37 percent. Managed care was not a single arrangement but rather involved a bewildering variety of forms.’ (160)
- ‘The objective of managed care firms was to wrest control of services from physicians and hospitals and push providers to make ‘cost-efficient’ choices. Computer-generated data on patients’ treatment and outcome made it possible to identify subpar performance. Physicians were pressured to spend less time with each individual patient, to use fewer specialists, and to order fewer tests and procedures. When physicians challenged their decisions, statisticians pulled out their spreadsheets to demonstrate how the doctors’ choice of treatment deviated from the norm. Some HMOs tethered physicians’ incomes to patient treatment decisions. Physicians who kept costs under control were rewarded with incentive pay of bonuses as high as $150,000 a year, while those who failed to do so were threatened with ‘delisting’.’ (161)
- ‘During the 1990s outraged physicians began fighting back against the speed-up of the production process, the loss of control over compensation, and the intrusion of nonmedical personnel into clinical decisions. They pursued their challenge to managed care through the courts, in the states, and in Congress, in many instances forming political alliances with consumers who were angered over the sometimes callous and clumsy treatment they received from managed care firms.’ (162)
- ‘By the mid-1990s polls showed that the insurance industry had become public enemy number one, even more despised than the tobacco industry.’ (163)
- ‘The system of HMOs, managed care, restricted hospitals and denial of needed medications has become so corrupt, so rotten, that I cannot stomach it any longer. The system is controlled by for-profit HMOs with dividend hungry shareholders and high-salaried administrators. I was beginning to feel the pressure and change my prescription habits from the best medicine I knew to the one that would look best on my profile and hating myself for it.’ Dr. Daniel Fisher on his resignation from medicine (162-163)
- ‘Physicians also lobbied state legislatures to regulate HMOs. They demanded that managed care companies publicly disclose the criteria they used to determine whether to approve a given service and won rulings requiring that nonmedical personnel could not deny services ordered by a physician….Physicians also used their influence to get state insurance departments to issue regulations requiring HMOs to disclose financial incentives that encouraged physicians to withhold care. Following a series of takeovers and mergers in the early 1990s, managed care firms grew rapidly in size and market scope. With their billions in assets and influential lobbyists, these companies proved to be formidable opponents. Recognizing their negative public image, they used surrogates to fight their battles, mobilizing the Chamber of Commerce and the National Federation of Independent Businesses against regulatory measures physicians proposed in the states.’ (164)
- ‘Physicians also took their grievances to court in a series of class action suits. They sued HMOs for antitrust relief, charging that insurance company mergers had consolidated power in the hands of a few companies. They brought against Cigna, one of the largest managed care firms, on racketeering charges for underpaying patients’ health claims, reaching a $50 million settlement in Illinois Florida June 20, 2002 , when the Supreme Court upheld a lower-court decision giving patients the right to an independent review for denial of treatment.’ (164-165)
- ‘The bill appeared headed for passage in the House until President George W. Bush threatened to veto it after his advisors concluded that patients’ rights were not a high public priority, patients’ rights were ranked only seventh in importance, after education, energy exploration, and conservation.’ (166)
- ‘From the New Deal to the 1970s, the chief obstacle to national health insurance was organized medicine. Then the excesses of the profession produced a counterreaction from the corporations that began to challenge the protected provider markets.’ (167)
- ‘Even though most studies have found few differences in health outcomes between managed care and fee-for-service medicine, the visible constraints on choice created the perception that people were willing to put up with constraints on choice in exchange for a promise of lower costs – a promise that hasn’t materialized.’ (167)
- ‘The arousal of corporations and insurance companies also had consequences for national health insurance. It brought newly mobilized, powerful stakeholders into the political arena whenever health care reform was on the table.’ (167)
- ‘Since then, the long-term care market has moved in a direction that is similar to the pattern of health benefits for the younger population. That is, a small proportion of people purchase expensive policies on their own in the individual long-term care insurance market, a growing number are offered group long-term care benefits through an employer (but with the employer paying none of the costs), and the rest will do just what they have been doing – spending down their assets to qualify for Medicaid or hiring a smart lawyer to help them protect their estates.’ (168)
- ‘During the 1990s, the insurance industry emerged as the unchallenged master of the health care financing system, triumphing physicians and hospitals and turning back challenges that might undermine their access to core markets. Industry leaders mobilized forces to fend off federal regulation, crush proposals for government-backed long-term care insurance and national health insurance, and spur the development of new private company products. At the century’s end, the private insurance industry had vanquished any public sector alternative.’ (170)
- ‘In the United States
- ‘On January 15, 1993 , [Clinton
- ‘On September 22 President Clinton made a prime-time address to the nation outlining his plan for health care reform. In his speech he decried spiraling health care costs, increasing red tape, and unaffordable prescription drugs and declared that Americans should never be at risk of losing their health insurance. Reforming the health care system was integral to improving the economy. Then in a dramatic gesture, he held up a red, white, and blue ‘health security card’ and promised to enact a program that would guarantee universal coverage and access to quality medical care.’ (186)
- ‘Whereas in the 1940s the AMA had been the most vocal opponent of the Truman plan, in the 1990s physicians were nearly invisible in public debates over Health Security. One reason was that the AMA was no longer the sole voice of the medical profession. Rather, the profession had splintered into hundreds of special-purpose medical associations. Another was that the AMA had become more diverse, with women and minorities making up a larger percentage of the membership. These changes not only made consensus more difficult to achieve but also meant that the threat of being ostracized for publicly disagreeing was less severe.’ (192)
- ‘ ‘Even a popular President armed with a bully pulpit could not match the hundreds of million of dollars spent to distort an issue through negative and misleading advertisements and other means.’ [Hillary Clinton] Polls conducted shortly after Clinton
- ‘During his presidential campaign, Bill Clinton had pledged to reform the welfare system. With Health Security in tatters, he needed to show he could fulfill at least one of his promises. The Personal Responsibility and Work Opportunity Act replaced AFDC, the New Deal cash assistance for poor mothers and their children, with Temporary Assistance to Needy Families (TANF). TANF had stiffer work requirements, a two-year time limit, and a cap on benefit amounts regardless of family size; combined, these features made it tougher to qualify for cash benefits. The intent of welfare reform was to discourage long-term welfare stayers and encourage work, not to reduce health benefits for poor families. To prevent mothers who lost cash benefits from also losing their health coverage, TANF was purposely decoupled from Medicaid. States were given greater flexibility to expand Medicaid eligibility beyond the traditional welfare limits. Under the new rules, mothers who left TANF could continue receiving Medicaid for up to 12 months. Then at the end of a year they could be reevaluated to see if they might qualify some other criteria. Among women who left welfare for work, one-third continued on Medicaid, one-third obtained private health coverage, and one-third became uninsured.’ (194-195)
- ‘In 1997 a new child benefit, the State Children’s Health Insurance Program (SCHIP), was enacted. SCHIP increased funds to the states to insure low-income children. Under SCHIP states could cover children from families with incomes up to 200 percent of the poverty level, either by expanding Medicaid or be creating a separate program. Since SCHIP was enacted, children’s uninsurance rates have decreased sharply. From 2001 to 2003, the percentage of low-income children enrolled in either SCHIP or Medicaid rose from 38 percent to 49 percent. SCHIP rules were later amended to allow uninsured parents to be covered along with their children. While several states extended coverage to low-income parents, federal law prohibits Medicaid from covering people who are not parents. Childless adults are excluded entirely. Despite these gains, many eligible children remain uninsured. Rates of uninsurance are especially high among Hispanic children, with more than 25 percent lacking coverage.’ (195)
- ‘Between 1999 and 2001 alone, the number of employers offering long-term care insurance to their employees increased by 46.8 percent. As insurance companies expanded benefits to include coverage for home care, Alzheimer’s disease, and residence in assisted-living facilities, long-term care insurance also became an increasingly important part of retirement planning.’ (197)
- ‘The most recent health policy event was enactment of the Medicare Modernization Act of 2003, which provides Medicare beneficiaries with a prescription drug benefit. Hailed as the biggest overhaul of Medicare since its inception, the new program picks up 75 percent of a beneficiary’s drug costs up to $2,250 a year. Then in a confusing twist, coverage stops until a beneficiary has spent another $3,600, creating a ‘doughnut hole.’ After that Medicare pays 95 percent of any additional drug costs.’ (199)
- ‘The final caveat is that the federal government is prohibited from negotiating drug prices, the same hands-off concession that was granted to providers in exchange for their cooperation in Medicare. Who concocted this scheme? The no-price-negotiation feature came from the Pharmaceutical Research and Manufacturers of American (PhRMA), with its 620 lobbyists. In the first six months of 2003, the PhRMA pumped $8 million into a lobbying campaign against price controls.’ (199)
- ‘Across the entire span of the twentieth century, all attempts to enact a health care reform plan that would guarantee universal coverage have been defeated. The AALL compulsory state health insurance plan in the 1910s, Roosevelt’s proposal for national health insurance in the New Deal, Truman’s plan in the post-World War II era, Nixon’s National Health Insurance Partnership and [Ted] Kennedy’s Health Care for All Americans Act in the 1970s, and Clinton’s Health Security plan in the 1990s met the same ignominious fate.’ (201)
- ‘The health care financing system that emerged over the past 100 years is a patchwork of public and private programs that provides some people with secure coverage but leaves others with sporadic periods of being uninsured and 45 million with no health insurance at all. The recent decline in the number of employers who offer health insurance to their employees – from 67 percent to 63 percent in just the two-year period from 2001 to 2003 – has shaken confidence in the future viability of employment-based benefits. The drop in retiree benefits has been even more precipitous…from 70 percent in 1985 to 36 percent by 2000.’ (201)
- ‘Other health policy experts attribute the failure of health care reform to a weak labor movement. There is some truth to this assertion. For the first half of the twentieth century, the AFL, the largest trade union, rejected outright the idea that workers should form a separate labor party, a strategic choice that weakened labor’s ability to pursue national welfare benefits.’ (203)
- ‘Yet there is also evidence that counters the ‘weak labor’ thesis. Once the AFL and the CIO united into a single union in 1955, they mobilized first for disability insurance and then for Medicare.’ (203)
- ‘This brief historical moment of labor unity and strength was over by the late 1960s, when the trade unions once again split into warring factions.’ (204)
- ‘A third explanation for why the United States
- ‘While overt racial barriers such as separate white and colored entrances, wards, waiting rooms and cafeterias were removed in the wake of Medicare, racial dynamics have not disappeared entirely from policy-making processes. As job-based benefits have become a surrogate for national policy, racial inequality in access to benefits has become a secondary effect of employment. Racial politics has also been transmitted through coded messages implying that minorities are undeserving beneficiaries of social programs. Such messages permeated the welfare reform debate of 1996, in which welfare recipients were implicitly portrayed as black, promiscuous, and lazy, even though the majority of AFDC recipients were white.’ (204)
- ‘A fourth explanation for why the United States
- ‘By attempting to account for nearly everything, theorists who focus on policy legacies can neither predict the direction of policy decisions (i.e., positive or negative) nor explain how the preferences of various groups get translated into actual political decisions.’ (205)
- ‘The evidence presented in the preceding chapters shows only one historical constant across every case, namely, that each attempt to guarantee universal coverage has been resisted by powerful special interests who have used every weapon on hand to keep the financing of health services a private endeavor.’ (205)
- ‘From the 1970s to the 1990s, the Health Insurance Association of America lobbied against national health insurance and long-term care insurance for the frail elderly, mobilizing small-business groups such as the National Federation of Independent Businesses and insurance agent associations to their cause. The only significant legislation enacted during this period, the Medicare Catastrophic Coverage Act of 1988, had the blessing of the insurance industry.’ (206-207)
- ‘Past experience suggests that any plan for the federal government to become the single payer of health care services would be certain to elicit the opposition of those who benefits from existing arrangements but that the government’s role can be expanded to cover the inevitable gaps that occur when coverage is purchased from an industry that, by its nature, is designed to exclude people with the highest health risks.’ (207)
- ‘The public is not averse to taking action. According to one recent poll conducted by America
- “Federal guidelines specify that states must cover certain mandatory groups. These include pregnant women and children under age six from families with incomes below 133 percent of the poverty level, older children in families with incomes up to the poverty level, most elderly and disabled recipients of SSI (the federal welfare benefit for the very poor), and parents whose income falls below state welfare eligibility levels.’ (208)
- ‘Due to its historic ties to welfare, Medicaid still bases eligibility on family status. According to federal law, childless couples and single adults are not eligible for Medicaid unless the state has obtained a waiver from the Department of Health and Human Services. As a result, only parents are eligible for Medicaid in 42 states. Medicaid income cutoff levels also vary according to family status. In most states children are eligible for Medicaid or SCHIP if family income is below 200 percent of the federal poverty level. For parents, however, the income cutoff is 70 percent of the poverty level ($10,835 for a family of three in 2004).’ (208)
- ‘Achieving a uniform level of coverage across the state requires changes in federal law to reduce variation across income classes and family types.’ (208)
- ‘For example, Medicaid could be expanded to include parents and childless adults with incomes up to 200 percent of the poverty level ($38,000 for a family of four in 2003). Only 32 percent of this group were insured in 2003.’ (208-209)
- ‘The chief obstacle to further expansion is cost. With state budgets periodically in crisis and shortfalls in 2004 totaling nearly $70 billion, governors are unlikely to welcome additional federal mandates unless they are accompanied by fiscal relief. That relief might take the from of an exchange where the federal government would pick up all the costs of covering children if the states would expand coverage of low-income adults, or it could involve a change in the way the federal match is calculated.’ (209)
- ‘Where housing, food, child care, and transportation expenses consume the entire household income, health insurance is an unaffordable luxury. Nor would Medicaid expansion help middle-income people who have been labeled uninsurable by medical underwriters. Coverage for these individuals and families could be increased through federal vouchers, with the amount of the voucher determined by household income. The vouchers could be used to buy into the Federal Employees Health Benefits Program, which currently is open only to federal employees and their families and which offers subscribers a choice of 350 health plans. If uninsured people were allowed to buy into the federal employee program, they would have the risk-spreading advantages that people who work for large firms now enjoy.’ (209)
- ‘In 2002-3 nearly 60 percent of Hispanic nonelderly adults were uninsured for some time, compared to 43 percent of African Americans and 23 percent of whites.’ (210)
- ‘Another idea that merits consideration is to establish a stop-loss plan, also called a premium rebate pool [advocated by Kerry]…the federal government would reimburse eligible health plans (including self-insured plans) for some percentage of their ‘catastrophic’ cases – say, 75 percent of any costs that exceed $50,000. A stop-loss program is already operating, in effect, with the Federal Emergency Management Agency (FEMA), which provides financial help to businesses and individuals that face catastrophic losses that their insurance policies do not cover. Reinsurnace is also working well in the Netherlands
- ‘The bulk of the problem today involves employees in small firms, a situation that has been gradually worsening. In 2004 nearly all large firms with 200 or more employees offered health coverage, but only 52 percent of the smallest companies (three to nine workers) did so. If a federal stop-loss benefits was adopted in the United States, small employers would be able to offer the ‘bare bones’ policy that many have advocated, and insurers could design basic plans, knowing that any excessively high expenses would be repaid.’ (211)
- ‘A less desirable option is to provide tax credits against the purchase of a private health insurance plan. Past experiments with tax credits have found them to be ineffective in extending coverage to the groups that need it most. In 1990 Congress gave tax incentives to low-income families to purchase coverage for their children. Children’s health coverage failed to increase, because the tax credit was small, covering less than a quarter of average premiums. Many people were not even aware that their children were eligible, and there were widespread abuses by unscrupulous insurers. Three years later, Congress repealed the legislation. Current tax credit proposals are equally meager. For example, in 2004 President George W. Bush proposed a tax credit of $1,000 per adult and $500 per child, with a $3,000 maximum, against the cost of health premiums. However, the average cost of a family policy in 2003 was $9,068. Further, tax credits would do little to help the 61 percent of people with incomes below the federal poverty level ($18,660 a year for a family of four) who were uninsured in 2003.’ (212)
- ‘In the notable instances when ordinary citizens defeated elite stakeholders, their success was predicated on their organizational capacity. Civil rights activists, trade unions, and senior citizens succeeded because they coordinated their efforts through organizations that mirrored the federated structure of American government.’ (212-213)
- ‘The best strategy for groups involved in health care reform is to forge a three-tiered coalition. At the top there must be a national leadership responsible for mapping out a grand plan to disseminate ideas, recruit members nationwide, and cultivate political insiders (influential congressional committee chairs and civil servants) who can introduce bills and devise ways to attach health care initiatives to less visible budget measures…At the middle level, the coalition must involve intermediate institutions such as state labor federations or senior citizens’ clubs, whose leaders can coordinate activities, tap into indigenous social networks, and disseminate the organizations’ models and ideas. Recruitment could focus on organizations that represent employers and trade unions frustrated by rising health care costs (up 14 percent in 2004 alone), older people who fear losing their health coverage along with their jobs, as well as low-income uninsured people, especially those who live in districts of key members of Congress. Finally, the coalition needs local chapters that can funnel money to higher levels and mobilize grassroots activists.’ (213)
- ‘The challenge facing reformers in the current political climate is how to craft a message that can unify the various needy population groups that might form such a coalition.’ (213)
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