'Bubble's going to burst,' health care conferees warn
By Carol Gentry
9/19/2008 © Florida Health News
ORLANDO – Feeling the rumblings from Wall Street thousands of miles away, some participants in a national health care conference in Orlando on Thursday suggested the unthinkable:
If health reform doesn’t come soon, they said, the $2.3-trillion sector could collapse of its own weight. They say health-system spending is as inflated as the real-estate market of three years ago, and some say it needs regulation as much as today’s banking industry.
“It’s not sustainable,” said John Engler, president of the National Association of Manufacturers and former Republican governor of Michigan. “That bubble’s going to burst.”
“There’s a true crisis in American health care,” agreed Irwin Redlener of Columbia University, co-chair of Doctors for Obama. “We’re looking at a financial meltdown.”
Here’s why, they said: The United States spends at least 50 percent more per person than any other industrialized country on the health-care sector, and in some cases, twice as much. That’s partly because the rest of the world free-rides on the United States, said U.S. Rep. Tom Coburn, R-Texas, who participated from Washington via satellite. “We spend more on research than the rest of the world combined,” he said.
But the major reason is waste, he said, estimating that $700 billion of the $2.3 trillion the U.S. spends on health care “doesn’t help anybody” because it pays administrative staff who process and haggle over claims. And then there’s defensive medicine. “Eight percent of what we spend is for tests that nobody needs,” Coburn said.
Inflation in health care is out of control, said William Winkenwerder Jr., senior advisor to Deloitte Center for Health Solutions. “We’re spending $800 billion more this year than we spent in the year 2000.”
For all the waste, many speakers noted that there’s too little money going into primary care, which is why doctors aren’t going into that line of work despite the need.
And the excess money isn’t being used to cover the 46 million uninsured or help millions more who are underinsured and struggling to pay hospital bills, they said.
Who’s responsible for wasting billions of dollars a year? “Democrats say it’s the insurers’ fault and Republicans say it’s the trial lawyers’ fault,” said Sen. Ron Wyden, D-Oregon, who participated via satellite.
“On and on we go slugging it out in the political battlefield,” he said, even though both sides have a point and should be working together.
That’s what Thursday’s conference was designed to do – find common ground. “America’s Health Care at Risk: Finding a Cure” attracted almost 250 people from around the country who have a hair-on-fire sense of alarm about the nation’s health-care system.
They came from big business, the health care professions, non-profits and the public sector, paying $249 to $499 for the one-day event, not counting transportation and the hotel stay, just to weigh in on the debate. The unusual conference was organized by the West Wing Writers, who craft speeches for Democrats, and the White House Writer’s Group, who work for Republicans.
Ending the partisan attacks and finding a compromise to repair health care is so important that Tommy Thompson, an advisor to Presidential candidate John McCain, begged off from a meeting with McCain to be in Orlando, he said.
Health care should be getting more attention from Republicans, said Thompson, who was President George W. Bush’s Secretary of Health and Human Services until recently. “They expect the free-enterprise system to fix it,” Thompson said. “It has not been fixed and it won’t be.”
Prices have become inflated in part because most Americans get coverage subsidized by their employers, due more to an accident of history than a deliberate policy choice. Those corporations have to compete with companies in countries that don’t have the burden of employee health insurance.
Verizon Communications spends $4 billion annually on health insurance for employees and their families, said Ivan Seidenberg, chairman and CEO. As chair of a Business Roundtable effort on health reform, he introduced a four-point plan designed to cover all Americans by setting up a national marketplace for private insurance and requiring individuals to buy it, with subsidies for those who can’t afford it.
A Republican congressman from Texas, Michael Burgess, spoke on behalf of McCain’s health plan, which would change the income-tax code to give individuals an incentive to buy their own coverage. “I liked the way Sen. McCain placed the individual at the center of the plan,” Burgess said. “He’s opening more doors to more Americans for more choices.”
Sen.Wyden said there’s no need to throw any more proposals into the pot. Speaking from Washington via satellite, Wyden noted there is already a bill before Congress with strong bipartisan support that would address many of the problems that plague the system. The Healthy Americans Act would cover everyone and yet pay for itself within three years, according to calculations by the Congressional Budget Office.
It would require companies to “take all comers,” including those who have a chronic illness or higher-than-average risk, Wyden said. “It would get rid of this inhumane insurance model based on shedding risk and cherry-picking,” a term that describes the practice of offering coverage only to the healthy.
One point drew unanimous agreement from all speakers: the need to apply 21st century information technology to the anachronistic paper-laden health system.
A number of Florida public officials attended the event, including Gov. Charlie Crist, who was the lead-off speaker. He urged the crowd to stop using the issue as a political football and start working as a team. “When we keep our eye on that ball, everybody wins,” said Crist, who was a quarterback in high school.
Crist talked about the low-cost “common-sense” initiatives he introduced when he became governor in 2007, aimed at helping the state’s 3.8 million uninsured. He mentioned requiring physical education in public schools, making drug-discount cards available to the public, extending insurance coverage to autistic children and allowing young adults to stay on their parents’ family coverage until age 30.
He said he’s especially proud of the “Cover Florida” program, in which state officials negotiate with private insurers to come up with different kinds of coverage that are more affordable than standard plans because they don’t include as many services. Nine companies have signed up to participate in the program, which Crist said should be rolled out in January.
“Cover Florida can be a role model for the country,” Crist said. “Maybe Cover Florida can be Cover America.”
The state requires participating companies to offer at least one bare-bones plan for $150 a month – hundreds of dollars less than is typically charged for insurance coverage. Crist told the audience that it would free Floridians of worrying about catastrophic hospital bills; later, in a hallway press conference, he conceded that the lowest-cost plans would likely not provide that kind of coverage.
Health consultant Winkenwerder said afterward that the Cover Florida plan “sounded good,” giving insurers the freedom to create their own benefit designs. He said, “We’ll have to see how many people sign up.”
--Carol Gentry can be reached at Carol.Gentry@FloridaHealthNews.org.
