Hidden costs of US health care


(For previous posts on the topic of health care, see here.)

In my previous posts following on the film Sicko (Haven’t seen the film yet? It is well worth it.) I have been focusing on the tangible costs and benefits of the US health care system compared to those of other developed countries, and showing why the US system comes out badly in comparison. The chief culprit is the insertion of profit-making private health insurance companies between the patient and health care providers, creating an immediate trade-off between profit and providing care that is detrimental to the latter.

But there are several intangibles that are also important. The main one is that having one’s health insurance tied to one’s place of employment highly distorts the basis on which people make important life decisions. Right now, many people make decisions of what job to take and where to live based on the health care provided by employers. People with families and young children are especially caught in a bind. Some people spend their entire lives in dead-end jobs that they hate, trapped because of the fact that they cannot afford to leave and lose the health benefits. This is especially so if they or a member of their family has a health problem that becomes a non-covered ‘pre-existing condition’ in their new workplace, and thus denied coverage, at least for a limited time.

What is the cost of this? For one thing, it discourages entrepreneurs and freelancers. A person who wants to quit his or her job to start their own business or implement an innovative idea is strongly discouraged from doing so, especially if they have families. Not only is the cost of purchasing private insurance for themselves prohibitive, so is the cost for providing it for their employees. In 2004, the average cost of health insurance for family coverage was $9,950, which means that it is likely to be around $12,000 in 2007. This is close to the amount earned annually by a full-time minimum wage worker. How many business ideas have never seen the light of day, how many jobs never created, because potential innovators just could not bring themselves to risk the health of their families by leaving their jobs?

Health insurance tied to businesses also discourages the creative arts. Painters, writers, sculptors, poets, actors, dancers, and musicians are people who add enormously to the quality of life of a community. A community that has a vibrant arts community is one that is lively and healthy. Most artists do not go into it for the money (although they have dreams of their work becoming widely recognized someday) but because they really love what they do and are willing to suffer some hardship for it. They are willing to forego luxuries and live fairly Spartan lives with respect to housing, food, clothing and the like, just to have the opportunity to create art. Many are willing to take part-time jobs to cover life’s essentials so that they have the time and freedom to devote to their passion. But the biggest single expense for such people is the cost of buying health insurance as private individuals. Many simply do not do so, gambling that they will not get very sick.

Then we have young people, straight out of high school or college who may want to experience a carefree life for at least a short time before settling down, and maybe travel around this vast country doing various jobs, seeing new things, meeting new people, and learning about the various communities they pass through. Maybe they want to work in underprivileged areas. Right now, the only way to safely do that is to do it through an organization that provides health insurance. If they go on their own, they have to buy expensive private health insurance or take the risk that they will not need health care. Even for the volunteer organizations that provide health insurance, providing it is a big headache and expense.

Then there is the problem of transitioning between jobs and between school and jobs. There are often gaps between the times when students leave college and start their first jobs. Because they have left school, they no longer are covered by their family or school health insurance policies. They have to shop around for some coverage for the transition period until they get their first job. People who have a gap when they move from one job to another can sometimes use COBRA coverage during the transition.

Even people who like their jobs and have health insurance plans to choose from (the so called ‘lucky ones’) face all kinds of irritations. The family may select an insurance plan and from it choose pediatricians for their children, an internist for the parents and a gynecologist for the mother, all within that one plan. The next year, they are likely to find that some of the physicians are now on different plans. So you have to repeat the process of comparing health care plans, weighing the costs and benefits, comparing physician lists, and trying to figure out who and what to keep and to jettison. This has to be done every year. And then you have to keep track of all the paperwork and receipts and co-payments. I think people have got so beaten down that they simply do not realize how much time goes into taking care of all these details. It is only when they get drawn into the bureaucratic nightmare that results when coverage is denied or some major illness strikes that they realize what a crazy system they are in.

Why have people in the US become so numb and accepting of this state of affairs? In surveying the responses to the film Sicko, James Clay Fuller makes a good point:

Not one mentions the comments by Tony Benn, a former member of Britain’s Parliament. Yet Benn’s statements probably are the most profound element of the film.

He notes, as other good people often do, that “if we have the money to kill (in war), we’ve got the money to help people.”

But, more importantly, Benn tells Moore, that all of Europe and many other places have good health care systems while the United States lacks such a basic service because in Europe and elsewhere, “the politicians are afraid of the people” when the people get angry and demand some action. In the United States, he observes, “the people are afraid of those in power” because they fear losing their jobs, fear being cut off from health care or other services if they speak up and make demands.

“How do you control people?” Benn asks, and he answers: “Through fear and debt.”

His point is that in the United States we have a great overabundance of both.

When are people going to get angry enough to say “We’re mad as hell and we’re not going to take it anymore”?

POST SCRIPT: The invertebrate Congress

On Bill Moyers’ show, Conservative Bruce Fein argues why Bush should be impeached and criticizes a spineless Congress for not doing so, and John Nichols (author of the book The Genius of Impeachment) agrees.

Here is a transcript.

Another conservative Paul Craig Roberts (Assistant Secretary of the Treasury in the Reagan administration and former Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review) has also called for the immediate impeachment of both Bush and Cheney.

The idea of impeachment was inserted into the US constitution as a vital check against the president assuming dictatorial powers akin to those of a king. It was almost tailor-made to deal with situations like that which currently exists. But the Democratic Party leadership seems unwilling to do this.

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