Over 80 percent of people are discontented with their medical insurance, whether provided by the government, their employer, or a commercial company. Common complaints are cost, increasing prices, and limited or rejected coverage. Regardless of the insurance’s source, we, the citizens, pay the bill through higher co-payments, deductibles, or premiums. Thus, their future payments increase when people request increased coverage for specific treatments, tests, or conditions.
However, individual desires are not a major driver of rising costs. Instead, the for-profit nature of health care facilities and insurers, such as Medicare Advantage (MA) plans, are. Recent studies have shown, for example, that many hospitals increase the severity of patient conditions, increasing the cost of services on the bills they forward to insurers. A five-state review in 2019 found about $14.6 billion in overpayments from this inflation. Projected to 2024, this would have exceeded $169 billion nationally. MA insurers, in turn, inflated the charges they passed on to the federal government by either doing the same or claiming additional, though untreated, diagnoses, as they received a bonus for more complex patients. Both inflated charges increase seniors’ premiums and Medicare taxes for the employed.
MA insurance was intended to lower health care costs, but it increased them by 22 percent per patient by 2024, and the five major insurers profited ±$185 billion yearly from 2014 to 2024. It has also been calculated that MA companies overspend or waste $450 billion yearly on administrative expenses, as each company requires different forms, has varying criteria for determinations, etc. These administrative differences and false billing cost each citizen about $4,850 last year.
We should not complain, as unfettered or minimally regulated commercialism has been a cherished part of the American ethos and intimately entwined with politics, from the local to federal levels, since the first Congress. Historically, some questioned the propriety of this influence. Yet, they were few, and their concerns were stifled then and continue to be suppressed as those who profit from corporations wield greater power and influence.
Adam Smith’s The Wealth of Nations, a philosophical text on business, is a “must-read” for those aspiring to senior-level administration and is often claimed to justify present-day business practices. Smith extolled the virtues of mercantilism, but would not have supported modern “Big Business” or its relationship with government. He perceived the purpose of commerce as the betterment of the population, not the accretion of profit. He contended that business owners who provided a safe working environment and decent wages would naturally prosper. The influence business presently exerts over government, he would have found odious, and the for-profit nature of health care repugnant.
Citizens deserve certain fundamental rights in a democratic society, including, at a minimum, basic medical care. This care is too essential to be entrusted to underregulated for-profit entities, which, as Mr. Smith emphasized, are incompatible with serving people. Even some religious-based hospital chains have diverged from caring for needy people to secreting large sums of unreported profits in offshore banks. One chain was found to have hidden $41 billion! When asked, they were unable to provide a purpose for the money.
According to our Founders and today’s proponents of democratic ideals, the government exists to serve the people. The U.S. is the only modern country that maintains a mercenary medical system in which a few profit off the illness and suffering of the many. Even some developing countries with struggling economies understand the necessity of a government-managed medical system.
We have attempted to patch our failing health care system for decades with minor adjustments, but this has been ineffective. Experts like Donald Berwick and Stephen Woolf have argued that we need a “systemic transformation.” We must adopt a version of a national health care system (NHS) and, given our history of mercantilism, most likely one combining national aspects with heavily regulated for-profit organizations. In this manner, we can ensure a fair and equitable system that guarantees every citizen a basic level of care.
This approach will have limitations and will not be perfect. It will face the problems that plague all nationalized systems: insufficient funding, escalating costs, declining essential services, limited innovation, personnel shortages, decreased employee and patient satisfaction, and fraud. Unsurprisingly, these issues, except less innovation, already plague our commodified health care system, and we pay 2.5 times more per patient than the average of other developed nations for the poor-quality service we receive.
Despite these negatives, national systems have three indisputable advantages: their health outcomes, population coverage, and average longevity are better at a far lower cost than ours, and this has been a consistent finding for half a century. In the most recent ranking of international health care systems, the U.S. was 16th in quality among developed nations and 96th in healthy life expectancy and health coverage compared to developed and less-developed countries. The average lifespan in first-world nations and countries with faltering economies like Cuba and Lebanon, with less modern and available health care, exceeds our average by 6.3 years.
Why do we criticize health insurers and celebrate the murder of an insurance executive as a righteous act, yet continue to support a flawed and expensive system that provides lower quality and unequal care, and fewer years of life?
M. Bennet Broner is a medical ethicist.
