This article just reinforces the fact that the U.S. government policy's aren't designed to make the lives of it's citizens better.The Reagan era was the beginning of the corporate takeover of the state and it continues to this day.The mantra in America is :Where going to rip you off unless you tell us to stop: and half the time that doesn't work.
35
Slight correction: "we are going to rip you off...until you sue and send us to JAIL....otherwise, we will keep ripping you off."
There, I fixed it for you.
5
It's easy to understand that if you put profit (30%) in between the consumer and the supplier, that costs are going to go up substantially in that industry (any industry)
Also, if you allow that industry to have free reign over what they charge and have no cost controls, then prices are going to spiral up and up.
Also in the 80's the diet fads started to begin, coupled with some key legislation that had food suppliers starting to eliminate fats and the like for sugar. At the same time. corn manufacturers were being subsidized like crazy for corn based fuel, as well as corn starch being used in everything.
This has led over a generation, of diabetes, obesity and a whole host of medical problems that the health industry has failed to manage or control.
Perhaps as well, there has been an explosion of gains within the pharmaceutical industry (related to monopolizing the market ) with a host of new pills. (especially the blue ones)
Just a thought.
80
The ground work was laid by the Nixon administration that allowed managed care and the USDA came out with the recommended low fat, low cholesterol, high sugar diet. Soybeans and corn still rule and are still unhealthy for us.
33
Tom Wolfe coined the phrase " the Me Decade" but it was Ronnie Raygun who sought its fruition.
Armed with a Voodoo Economics/supply-side theory, he foisted upon Americans the notion the best government is less government. That cancerous notion has metastasized in the GOP, embodied in the current Idiot-in-Chief and leaders Ryan and McConnell.
I can still recall when LBJ flew to his home state during a disaster. With no electricity, no media photo-ops, LBJ entered a disaster shelter. It was pitch black. LBJ pointed a flashlight at his face and said, "This is your president, and I am here to help".
Fast forward two decades, to one of Raygun's folksy homilies, "The worse thing one wants to hear is: 'I'm from the Federal government and I'm here to help". Cute, wot?
It pains me to now see a preponderance of Americans have not only bought this nonsense, they embrace it. Can you imagine?
Tell that hogwash peoples around the World whom we liberated in two world wars. Tell that to former enemies, Imperial Japan, Nazi Germany, Fascist Italy, who, without our aid, without the Marshall Plan, would not have recovered so soon. Tell that to all the disasters around the globe whose countries we came to their aid and rescue.
Yet, look what Raygun's asinine statement has brought US: a nation which no longer believes we are a great and good people. We have become a nation of selfish, self-centered people, epitomized now by our president. Great again? Not even close.
DD
Manhattan
35
Bayh–Dole Act signed by Carter in late 1980 May have effected healthcare costs by allowing patents in federally funded research.
Hatch-Waxman Act of signed by Reagan in 1984 May have increased drug costs.
Details st https://PubMed.gov/21933276
5
I have several graphs and lists of Health Care Costs over the 20th century; all show modest growth until after 1965 when Medicaid and Medicare were introduced; thereafter the rates skyrocketed. for decades. I easily found the following article from the CMS;
https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Tren...
4
We allow every aspect of our life to be commoditized, deregulation was necessary before this could happen. Very few people focused on the amorality of commoditization. They don’t see it for the simple greed that it is.
13
Whatever the reasons - and they have been legion - government in these United States has for the past half-century purchased the illusion of prosperity with debt. Economic health does not require strict avoidance of deficit, but does require investment of capital - whether from taxes or borrowings - into initiatives that lower costs or raise revenues. I was born more than a year before Pearl Harbor, and have never seen significant evidence to support the "trickle down theory" distributing wealth given to firms and people at the economic apex to those at its nadir. Maybe that's because most of my life has been spent nearer the nadir than the apex. But my experience convinces me that expecting tax cuts to lower government revenues will result only in the illusion of prosperity no matter how high the Dow goes. And low unemployment is being bought with debt, not real growth.
11
Literally everything in our society is now set up to benefit Rent Seekers, health care included. Rent Seekers, or Rentiers, are those who sit and collect money after an initial investment. So they don't have to work anymore. I.e., The Rich. Everyone else is the support system for the upper class Rentiers. It is the basis for the current capitalistic ideology. Government is a cost that needs to be taken down and hopefully eliminated.
10
Financed by Reagan administration, 200,000 Mayan Indians were murdered in Guatemala between 1983 and 1996, the biggest genocide to occur in the Americas during the 20th century (Israel supplied on-the-ground agents to help the Guatemalan army carry out the genocide). An additional 1.5 million Mayan Indians became internal refugees in their own country and were forced into "re-education" camps in the same manner as Mao in China and Pol Pot in Cambodia. Ronald Reagan was "The Great Exterminator." The blood of innocent children dripped from his every action. Of course, Reagan was "pro-life."
19
But I thought the free market competition was supposed to drive prices down, not up!
/snark
7
Was Reagan at fault? Could well be, but the arguments here aren't conclusive. At any rate, someone at the Times please let Professor McDonough know that the Me Decade was the 70's, not the 80's.
2
Trump promised us better cheaper healthcare.
Where is it!
10
Another cheer for St. Ronald. This goes with "catsup is a vegetable", "trees cause pollution" and the Laffable curve. But even ho would be to liberal for the Trumpeters of today.
8
The 1970's wage freeze imposed by Nixon caused employers to give benefits-health insurance-to employees in place of pay raises. When a faceless corporation, not the patient, pays for services the price is not questioned. Break out the rakes.
2
Employers have been offering health insurance as a benefit to employees since the wage freeze during WWII.
9
It goes to show everyone Reagans Trickle down theory was a joke made up like everything else the GOP think up. Give me government intervention anytime to be fair and affordable. You need regulations other wise you got chaos and the 1 percent will always take advantage of the 99 percent will always be struggling. Capitalism does not work. Reagan and this article proved it. We need a fair system that gives everyone a chance with plenty of rules.
12
I encourage anyone who doesn’t understand why to run for office on a promise of cutting healthcare costs.
1
So in other words health care became a commodity and those that could write the check benefited and those who could not had to do without. Reagan also famously defunded mental institutions and programs that benefited the mentally ill in outpatient clinics. I am sure that this has had a bad effect on our health care system especially our ERs.
12
and I might add our gun violence and homelessness.
7
Not to mention the criminal justice system.
5
The fundamental problem is that neither the Replicans nor the Democrats understand the medical care marketplace and its fundamental flaws and failure. When you pay the system for more visits and more services of ever increasing technology with the individual providers (hospitals, docs, and administration) having a fundamental and unwavering economic incentive to do more visits, more services, of a higher intensity, with no regard to clinical efficacy or patient outcome, we get the most expensive and one of the least effective (in terms of health outcomes) health system in the world. No amount of regulaton is going to turn around these fundamentally corrupt incentives. The only way is to organize the incentives so that consumers get improved health for their dollars, not just more sophisticated and ineffective interventions and visits. The ACA attempted to introduce a kind of private marketplace that might have been a transition from our present situation to have insurers and providers held more accountable to improve the health of the population over simply producing office visits, interventions and hospitalizations, but the Republicans have disparaged and gutted it. The Democrats idea of “Medicare for All” is the extension of a system that already is out of control—though better than the present dysfunctional marketplace.
I believe that solving this problem will require unbelieveable amounts of collaboration and education by our legislators. I am not hopeful.
9
Is it really that difficult to understand? Everyone on the billing side of the equation (docs, hospitals, pharmacies, etc) is incentivized to run up the bill. And a system with few regulatory controls just makes it much easier to do this.
39
I complain about it every opportunity I get. My health insurance premiums doubled in the last 4 years, from $450 a month approximately to $860 a month. No subsidy. BCBStx. Pretty much BCBS my entire life, from age twenty on. And that is the burn. After paying for health insurance for a lifetime the premiums cross over to "I can't afford but must have due to age." Years would pass when I was younger with not so much as even a physical.
6
That's about right. When you are 65 BCBS expects you to go through about $12,000 a year in healthcare costs so the fact that your premiums are about $860 sounds about right. Of course, in the old days if you came down with something at the age of 62 or so, they would get rid of you by denying you coverage based on a pre-existing condition.
That's why our healthcare system was never really going to work in the long run, because in the long run, you are going to get sick, which might require medical care and intervention and in the end you die or maybe the healthcare providers gets lucky and you die instantly in a car wreck or something similar.
3
This is business folks. Sure it's now called the health care business, but it's just another business now. CEO make 10s of millions, cost cutting takes precedence, regardless of the effect on pts, care givers are just factory workers in white coats, pts are revenue sources, and best of all, the business is now in bed with the government, health insurance companies and regulators and they're subject to the same influence peddling at every level as every other business. The really good news is, it's not any cheaper and the results aren't getting better, but it's just a business and certain folks are making millions and that's all that matters.
15
The only reason smoking cessation was successful here is because those injured by cigarettes sued and won. We need to sue to stop the food and beverage companies from adding high fructose corn syrup to nearly every processed food product made. Doing that though, would cause massive losses to companies like Monsanto that own all the largest corn producers.
18
Don't forget tHe lawyers who worked on the settlement were paid between 7,000 and 100,000$/hr for their share of the payments. It seems the "invisible hand of the market" is at work everywhere.
5
This article or analysis is total hogwash. Look at the quote
"Before the early 1980s, payments by Medicare and other insurers were tied to costs. If it cost a hospital, say, $5,000 for a patient’s surgery, that’s what the hospital was paid, plus a bit more for reasonable profit."
Fee for service - or reimbursement for each service than fee for health outcome is what cause healthcare costs to skyrocket. Hospital charge exorbitant charges for unnecessary services is what caused healthcare inflation.
4
You are both right and wrong. In fact before 1980 Medicare paid "reasonable charges" on a fee for service basis. There was no required or legal relationship between costs and charges. This is still the way it is today.
3
The point of the 'Greed is Good' Gordon Gekko character was that he was evil, thrown in jail & an airline with all its jobs was saved from a ruthless corporate raider because he was taken down. Free-market extremists always seem to misremember the moral of the movie.
10
I was recently precribed a new medication for the treatment of seizures as the result of a traumatic brain injury. The retail cost for the drug Vim Pat produced by UCB Pharmacuetical based in Belgium is approximately $900 per month. There is no generic version available in the U.S. The cost for the medication is 1/2 as much in Canada and 1/2 of that for the generic version. I have a difficult time believing that UCB is selling the drug for a loss in Canada, and what possible advantage does the American consumer receive for the UCB monopoly protection from generic competition? There are thousands of examples like the one above, and they are the reason healthcare in the United States is so expensice and out of reach for so many. We regulate the internet, telephone communications, energy to name a few. How did we get so far off track to ever believe the market place is the answer for health care? I keep hearing about the conspiracy of the deep state. That is nonsense. If there is any conspiracy, it is among the many corporate cogs in the wheel of capitalism that are committed to fleecing the public for every dime they can rake.
25
You are right the pharmaceutical companies have massive and unreasonable patent protections and exploit them to the full to maximize profits. BUT you must not overlook that Medicare Part D passed under the aegis of President George W Bush explicitly forbids importation of pharmaceuticals from Canada and forbids Medicare from negotiating drug prices.
15
@ M. Downey, Helena, MT "I keep hearing about the conspiracy of the deep state. That is nonsense. If there is any conspiracy, it is among the many corporate cogs in the wheel of capitalism that are committed to fleecing the public for every dime they can rake."
Now you're getting it!
But here's the rest of it:
Although it is true that they have their tools in both major political parties, only one of those two parties is wholly owned and operated by those corporations, and their billionaire shareholders, for their interests, and only for those interests.
Two guesses which party that is -- and the first one doesn't count.
The state you are writing from is one of the reddest states there is.
And things aren't going to change (except to get worse) until we get both more, and better, Democrats into office, at all levels, but especially the federal.
You have your work cut out for you -- your friends and neighbors?
They won't even listen to us.
But they might listen to you -- maybe.
Good luck.
8
There has been not a single positive outcome of Mr. Reagan's policies.
16
Yes. We have a deregulated “free market” healthcare system that works quite well for investors, hedge funds, and healthcare industry CEOs. Just not so well for the healthcare consumer, i.e. everyone else
21
Those of us who lived through the 1980s and all the nonsense that Republicans foisted on the American people will find this old news. Just about all of our nation's political and economic ills can be traced to the disastrous presidency of Ronald Reagan. Every Republican president since WWII has been a disaster for our country. He had the good fortune of seeing the Berlin Wall fall, but from taxes, to racism, to tribal politics, to deregualtion, to anti-unionism he left us a legacy of economic despair and decline.
25
Wake up man.
We are so much worse off since 1988 and there has been 16 years of Democratic administrations .
You can keep blaming this on Republicans.
They may be worse the Dems have done plenty of damage while the constituents are blindly following the hucksters on Cable News, and of course "comedy" late night shows.
The part of the country democrats hate claim they are stupid or at best ignorant. Well they have little or very poor education.
What's the over-educated liberals excuse?
4
Which proves exactly what? That Republicans did more damage in 14 years than Democrats did in 16? Not so hard to conceive when you compare, say, GHWB to WJC, and (especially) GWB to BHO.
In the latter case, I can't cite a single Obama episode that rises to the level of the series of calamities of the GWB era: 9/11, fraudulent WMD, the dual morasses of Afghanistan and Iraq, Katrina, unprecedented fiscal profligacy that squandered Clinton's balanced budget legacy in favor of record deficits, the global financial meltdown of 2007-2008, from which it took Obama years to dig us out, with a GOP congress fighting him every step of the way. But take heart: By all indicators, your guy in the White House is on track to break all modern-day records for malfeasance, and he's just getting started.
4
Take out the profit motive and middlemen and you are left with a single payer system. That is a good thing.
9
1980 began the Reagan “Winner Take All Politics” era. ‘Deregulation’ began, removing protections bolstering the public good. Corporate dominance, “maximizing shareholder wealth”, replaced balancing employer-employee-community-customer-environment-shareholder interests. Unions were weakened. HMOs. run by business managers for profit, replaced medical private practices and partnerships.
This underpins the US post-1980 departure from other OECD countries. Compared to them, the US started paying far more per person for health care. Average US longevity did not even show the same gains as others, and it actually shortened for the poorest.
As union strength weakened, so did the percent of the US public covered by employer-sponsored health insurance. According to the CDC, https://www.cdc.gov/nchs/data/nhsr/nhsr017.pdf
“Between 1959 and 1968, the percentage of persons under age 65 years with hospital insurance increased from 69% to 79%, … ” “[it]… remained stable at about 79%” …but:
“During 1980–2007, the percentage with private coverage declined …. to 67% in 2007…” “The downward trend in private coverage was driven in large part by a decline in employer-sponsored coverage. In 2007, 62% of persons reported employer-sponsored coverage, down from 71% in 1980.”
Until the ACA, individuals under age 65 had no replacement for employer-sponsored insurance. The uninsured, having to pay for any health care they received, waited until a condition became extreme, expensive and risky.
10
Reagan was no less despicable than the current occupant of the White House. He was an empty suit mouthing slogans of the far right, and he destroyed Unions with Right To Work, which led to the destruction of the Democratic party. Our country now measures success solely by profit. We no longer ask what we can do for our county, or how to promote the general welfare. He made our nation of big ideals into small minded, self-centered storekeepers.
18
The election of Reagan was one of the biggest corporate Fascist coups ever pulled over on the US. We will never recover from this or the Reagan era. It was the beginning of the end of us.
Things have only gotten much worse for most of us since 1980.
19
Wow, the 80s produced so many wonderful people and ideas that i am surprised we aren’t living in a conservative utopia by now.
13
One day, though probably not in my lifetime, publications like the NYT will stop pretending that Republican politicians & and their acolytes in academia are actually concerned with either health care, its costs or the fate of "undeserving" patients.
Stuart Butler and Gail Wilensky have spent their careers insinuating that only the rich deserve adequate medical care and that the poor are either too stupid, too lazy, or too immoral to be be genuine patients. If it were up to Butler & Wilensky (and their Think Tank colleagues) the poor would be encouraged to either starve or drink/drug themselves to death. In the minds of Think Tank Republicans, that would be the fitting capitalist solution to high health care costs.
Has everybody forgotten that Ronald Reagan not only never mentioned AIDS, but believed that the plague was a dandy idea, and made the world safer for straight Christians?
The Republican solution to high health care costs is simple: If you can't afford treatment, go die. Fast.
8
As long as the right people got rich, who cares if people got sick or went broke or died. It's the new American way, right Ronnie?
7
Perhaps the Times could look at the rise of direct to consumer advertising of prescription drugs, using the same time frame.
9
This is a real mystery to me I really cannot understand how rational people want the American Healthcare System instead of single-payer. Wr pay 18% of our much higher per capita GDP versus Europe's 10 and a half. Europe has much better results to show for its much lower expenditures and that includes success rates on various common procedures.
8
I skimmed nearly every comment and am amazed - and disappointed - by how few stated the obvious - that the solution is single-payer Improved Medicare for All. And while there are myriad problems in our current arrangement, the most obvious, and fixable, contributor to costs is the system-side 30% administrative overhead. Some $500B could be saved with a single-payer system, more than enough to cover everyone, and lower total healthcare costs for around 95% of us. We can get there as soon as enough of us realize this to make our representatives fear losing an election more than losing drug & insurance lobby money.
18
You have it backwards. Regulations ALWAYS increase cost and deregulation reduces it. The reason healthcare costs are high is because of government meddling in the market. Competition always lowers prices in a free market.
2
Ladies and gents, here is a prime example of an overly simplistic view being applied in a very nuanced and sophisticated system.
7
Or why my health card now has photo IDhttp://independentbloggersalliance.blogspot.com/2009/11/americans-filchi... Until recently so many US pharmatour buses where showing up a border towns to get scripts filled, they voided local pharmacy inventories making it necessary to introduce restrictions on filling any more foreign scripts.
2
Pure wishful thinking. There is no such thing as a free market without regulation because competition is tough and kills off most competitors - I think 9 of 10 new businesses fail. The big winners allocate niches and follow each other's prices up and there's very little competition. Why do you think there are no little oil companies or little car makers or little Facebooks or little Credit card sponsors? A good idea gets bought up by a big player. The Big Players are a lid on the economy.
9
Deregulation only works for businesses , not for the consumer . As pointed out , health care became a business only interested in profit , they're not in it for your health but to benefit their bank account . It is outrageous what hospitals charge for even the smallest thing as a bandaid provided by their stock . Along with all the changes , the insurance industry , hospitals are busy gobbling each other up , driving prices even higher , leaving little choice and competition therefore charging what they want . It seems here the victims here are the consumer and the Doctors which spurs them to become self protective and join large groups making choice of doctors sparse . Healthcare in this country has become nightmarish and almost futile .
15
Its simple. I pay a completely different price then you pay. In all the other rich democracies everyone pays the same price. This amounts to half of the administrative waste in American medicine payment systems. Some hospitals in this country have a whole floor devoted to administration of complex insurance rules, plan prices and their own proprietary pricing schemes for the less fortunate. Some stakeholders have a vested interest in sky-high prices, any product purchased from a vendor in a Medical establishment costs much more than it's civilian counterpart because the HC providers have the monopolistic pricing power. The same stakeholders will fight tooth and nail for the privilege for it to remain that way.
10
Regulating prices - which I favor - means that someone somewhere has to get something less than he or she now gets. We very much disagree over who should bear these costs. Is it reduced salaries for the doctor, who is typically not paid dramatically more than most professionals and more than infrequently are responsible for keeping people alive? Is it the hospitals, some of whom, particularly in poorer neighborhoods, are struggling financially. Is it the pharmaceutical companies who, with lowered revenue, might not chase after cures that are not likely to be profitable in the near term? Or should it be the patient, who may have more restricted access to medical services, devices and drugs
Who pays and how much is always the most difficult question on which to get people to agree.
10
The problem is for profit medicine - unlimited profit. The "someone somewhere" who is getting big money is not any of the actual players that treat the sick: doctors, nurses, aides, researchers (mostly paid peanuts by the NIH at public expense), etc. It's the top management, especially at insurance companies, and owners of PHRMA companies and Insurance companies. Insurance companies are a middleman that take out 21% in profit - that was 10 years ago, it may be more now. The government does not require price controls on Government financed research. Drug billions go to the top end of the PHRMA companies that pay mostly for advertising, not research, and lobby endlessly for lower testing requirements. Medicare should, of course, bargain drug prices. When Obama was elected the estimated savings was $35,000,000,000. Obama agreed not to do it in the first 3 months of his presidency so PHRMA wouldn't go to war against Obamacare. He should have done it immediately and lowered the age of Medicare a year at a time for a couple of years, helping ordinary Americans right away and making it all easier...
5
The big total dollars are not going to outsized executive salaries or some of the other items that you mention. There are simply too few of these in the $3 trillion or so that we spend on healthcare every year to appreciably affect total spending.
We have to understand that there are hard choices to make if we are serious about reducing healthcare costs.
Deregulation is supposed to be coupled with increased competition, thus using the "magic of the marketplace" to control costs. Since the price of health care services is not readily available to consumers this doesn't work. It allows for egregious profit-taking by medical care providers at all levels of the system.
32
The Reagan era change from reimbursing hospitals for Medicare based on their reported cost to pre-set prospective payment rates per case was the opposite of deregulation. It was considered necessary because previously the more hospitals spent, the more they were paid. The longer the longer patients were kept in the hospital, the higher the cost and the higher the payments. The system was designed to reward efficient (low cost) hospitals and weed out the ones that couldn't or wouldn't bring cost down closer to the median. Over time, that was supposed to ratchet cost down and limit annual expense growth. However, Congress gradually removed discipline from the system through a series of over generous measures that were designed to help hospitals that were deemed to be at a competitive disadvantage. Expensive new medical technology, massive fraud and expansion of the Medicaid rolls are other major influences on cost increases.
7
Probably the best comment of all. No carrying on about Reagan, Obama, Trump etc. The increases in technology have had a big impact on prices. Joint replacements, for example. Certainly in areas like South Brooklyn and South Florida, medical fraud is out of control. And how about the ubiquitous "facility fee" on every other bill-one of the greatest scams of all time.
4
DRG’s (the prospective payment system rolled out in 1984) worked! Hospital days per 1,000 population dropped dramatically. Lengths of stay were cut in half. Underperforming hospitals closed or merged to form large health care systems. However, and this is important, while hospitals were incentivized to do less, physicians were incentivized to do more; more procedures, more tests, more of everything! And, with improved medical technology, that “more” quickly moved from the hospital to physician owned settings where there was no prospective payment system.
And don’t get me started on a failure by so many physicians to adapt an “evidenced based” approach to the practice of medicine.
8
Ah, wrong there Rob. The 80's also brought with the Stark law and increasingly services that could be provided by physicians were outlawed. The following decade brought selective exemptions because it was discovered that removing them out of physician offices to hospitals actually increased costs - but for many services by then it was already too late, as hospitals were also getting a higher differential payment for the same service they provided as an outpatient service compared to a private physician. This differential continues today though Congress tried to address this issue by limited payment differences if a hospital acquired a service or physician practice off a hospital's main campus - however the law has been watered down and acquisition of physician practices, urgent cares, etc by large hospitals continues as they drive to control as much market share as possible. Meanwhile what has happen with costs??? - while ratcheting back physician reimbursement by Medicare for example and increasing the use of selective networks by commercial payers? HC cost was about 8% of GDP in the 80s - now 18%. Shifting physicians and services from private practice to hospital employment and services hasn't worked out so well.
10
in the 1970s, as profits from traditional industries were leveling off, new areas of exploitation were created. Foreign cheap industrial labor and domestic labor in the so called service area. So women and lowly paid immigrants become the source of wealth for these "Health Care Organizations" (or the insurance companies) that increasingly accumulate at the expense of the whole society. Obesity, wage stagnation, inequality and many other social illnesses have a common root in a solution to the problem of capital accumulation at the time. Now we face bigger problems created by this solution
5
America is the only major country that allows lawyers contingency fees- 35% of the award in any malpractice case- John Edwards made $20mil in several years suing obstetricians.
Also it has the most expensive medical schools- most doctors owe more than $200 and choose high paying specialties. Most countries have free medical school.
Insurance and hospital executives are paid more than doctors. Most doctors earn $200-700k, less than many businessmen, bankers, developers, investors, and lobbyists.
Most of Medicare is spent on the last 2 years of life- terminal care.
Most of Medicaid is spent on nursing homes and kidney dialysis.
There is much waste of money
16
And we have a severe shortage of doctors and nurses being educated.
4
Andrew, you make some good points, but your comment that most of Medicaid is spent on nursing homes and kidney dialysis is concerning. What alternative do you propose for low income persons - let frail elders and persons with kidney failure go untreated and die?
2
We have a shortage of primary care doctors
Many nurses have left to better and easier jobs like realtor, sales, finance. Starting salaries are lower than teachers in poor states, but can go to $100,000 with experience in rich states.
Reaganism certainly exacerbated the problem, but it began a bit earlier when the American medical system began to shift from a non-profit public good enterprise to a for-profit industry. Arnold Relman, then editor of the NEJM wrote a prescient article in 1980 warning about the rise of a medical-industrial complex (riffing on Eisenhower's warning of a growing military-industrial complex in his 1961 farewell address):
https://www.ncbi.nlm.nih.gov/pubmed/7412851
The main problem now is a lack of campaign finance reform resulting in a feedback loop in which the medical industry (by far the biggest source of lobbying) pays Congressional representatives who then pass laws favorable to industry. For example, Medicare is forbidden to negotatiate for competitive pricing of drugs. I wonder why...
25
How does the deregulation theory explain the astronomical rise in the cost of primary, secondary, and college education? It seems to me that the absence of clear pricing information coupled with Baumol's theory and the inability to scale service delivery with volumes is more meaningful than "deregulation".
4
Deregulation of various businesses and industries started under Jimmy Carter. For example, it was Carter not Reagan that deregulated the airline industry, phone company, interstate trucking, etc. in response to trying to break the back of stagflation.
But, two costs in particular since 1980 have exploded - healthcare and higher education. In fact a college education (public or private) now costs four times in inflation adjusted dollars than what in did in 1980, and has even outpaced healthcare in costs in that time period. My take is that we consume things based on how we pay for them as much if not more sometimes than what those things actually cost, and with both healthcare and college the consumer is often distanced from the seller by intermediaries such as insurance companies, state and federal government programs providing all sorts of subsidies from Medicaid to Pell grants, etc. Unlike say an airline ticket where the consumer is interfacing directly with the provider without any third party help or provider. To the extent that choice is not based on how much something costs, it is to be expected that the providers will increase costs accordingly.
9
We pay two to five times more for medical care with significantly worse results.
What's the problem? We're exceptional in every way.
12
In 2016 the US spent about 16% of GDP on healthcare. The average of OECD countries (which includes France, Germany, Canada, and the UK) was about 10% of GDP. So the US is spending about 60% more for healthcare, which is significantly less than "two to five times".
5
There are stats that show the U.S. more at 18% of GDP in recent years and about 10% in Europe. So, no, it isn't five times as much, but yes it's almost double.
Another thing to consider: with European-style health care, there isn't the medical bankruptcy issue. There aren't unbelievable, post-hospitalization bills, or collection agencies or attorneys vulture-capitalizing on people who need health care services.
@ Scott Werden, Maui, HI "significantly less than 'two to five times'."
You are SO right.
We ARE paying only (per capita) 50% to 100% more than any other "developed" [sic and sick] nation for our healthcare -- and details like that definitely DO matter.
But they do not matter so much that we can just utterly elide the other half of greppers' observation -- that we enjoy (overall, not necessarily individually) significantly worse results.
We were [in]famously rated 37th (!) in the world in healthcare outcomes in a UNESCO study in the early 00's -- and we've lost ground since then.
Currently, we, along with Russia (hmm.... no wonder they want us to be more like them, be led by them....), are one of the few countries in which significant cohorts of our population are seeing their life expectancies SHRINKING.
"The richest country in the world."
How unsurprising that, in your concern for fine detail, you'd prefer that we ignore all that.
Like the "pro-life" president he was, Reagan polices were mostly pro-DEATH.
21
Reagan started the race to the bottom with massive deregulation in the 80's and Trump and Ryan will finish his efforts by 2020. Free market capitalism is a corrupt fraudulent system that is designed to only benefit those of power and means. Think about it? The increasing wealth gap, decreasing wages, increasing costs. As a nation what Reagan started and Trump and Ryan will finish will not end well for our Nation..
19
Since when are HMOs/managed care "the free market?"
They were promoted by government fiat and paid for with taxpayer money as in Medicare and Medicaid HMOs. The government allowed them to dodge risk at every turn and enhance profits. Congress protected them. The courts protected them. While opinion polls consistently have shown that the public views HMOs only slightly more favorably than Congress. The intellectual community particularly academics at elite universities favored them. And don't forget that the mainstream press for the most part gave them a pass because they thought them best to rein in greedy, incompetent doctors -- and somehow not affect patient care. So now you can write about unintended consequences. R.I.P.
6
Reagan set up an absolutely ruthless system designed to enslave patients to hospitals and banks. Whether intended or not, his actions set in motion a paradigm where a patient needs to rigorously evaluate seeking every healthcare intervention and where, despite the patient's education and intelligence, the only person qualified to evaluate the need is a healthcare professional.
6
The headline should read Prices, not Costs
11
The GOP's revisionist paintbrush has successfully rendered Clinton - during his watch, one of the most popular and inspiring modern US Presidents worldwide - as "Slick Willie;" while rendering Reagan - an anti-intellectual, socially divisive, economic disaster for our country - as "The Great Communicator."
Those who buy into it don't bother with the facts; they simply repeat the mantras of "lying about sex under oath," and "ending the cold war."
Look where we are today with the President lying about sex and the cold war. Everybody happy?
19
The beginning of the end of American greatness can all be traced back to the Reagan presidency. Disdain for government, education and a blind belief in the sanctity of the free market all began in the 'greed is good' 80s.
Morning in American was actually the sunset announcing the long night we are living today.
38
The Ronnie Raygun revolution was just that, revolting.
This once FDR, New Deal-loving ah-shucks Dem, as he prospered, came up with this nauseating homily: "I didn't leave the Democratic party, it left me".
Sorry Ronnie, you poorly demented soul. No, the DNC did not leave you. You left it when you and your father went from beneficiaries of the FDR's social safety net programs to donor. You grew wealthy. Then, it became your turn, to kick in, to pay back, to those who followed, to those who were now the unfortunate.
Yeah, Ronnie, now it was now time to contribute to this great country you claimed to love so much, for the good fortune it now bestowed upon you.
Because of revolting Ronnie, a segment of poorly-educated deplorable Americans bought the snake oil. They ignorantly concluded Ronnie was great. He was not. He was a selfish dolt who did not want to pay taxes to support people he now viewed as "welfare queens", freeloaders. something which he was not.
Republicans like Ryan, another benefactor of the social safety net, thought like Ronnie. It was good for him and his family, not so much anymore. People today are "different" than he.
Raygunomics, aka Voodoo Economics, tells US the rich must be rewarded, cutting their taxes along with government services, keeping wages for the middle class stagnant, thus unable to climb up to the next rung. of the ladder
Raygun's slogan, "make amerika great, again".
Sound familiar? That's right, same old snake oil.
DD
Manhattan
39
Couldn`t agree more
the "Reagan Revolution" was the biggest farce ever perpetrated on America...and the republicans made it their bible...from which they still quote passages from ,to this day....and they mad him their political god ..
Doddering old fool with a flimsy facimile of an already disproved and worn out version of an american dream
8
Apart from the major exception of government owned and operated portion of Veteran's Admin (a lot like England's NHS only just for armed forces personnel), US approaches have mostly come down to public subsidies for private providers. That's true of Medicare and it's true for ObamaCare. It's very difficult given that model to exert any meaningful pressure on prices or to modulate demand, particularly when there are multiple sources of payment from public ones to insurance companies to private payers. What tends to happen is service expansion, product diversification, industry consideration, and profit extraction are all incentivized, whereas quality of service, and targeting those who could actually benefit from the healthcare product or service, all become marginalized. Costs balloon, health implodes. Then you add legal protections and monopolies for providers, extend patent protections to drug companies and medical equipment suppliers, and prohibit tendering and bulk purchase of pharmaceuticals -- all pork barrel/corrupt moves by Congress and various Administrations in support of corporate interests, and voila, you have the expensive mess of today. Not really that mysterious.
5
@ Cephalus, Vancouver, Canada "it's true for ObamaCare. It's very difficult given that model to exert any meaningful pressure on prices"
Respectfully (really, no snark), while the PPACA ("Obamacare") has its flaws, it also has succeeded, for the first time in two generations, in significantly bending the cost curve, for a reason that even its strongest proponents often underrate or forget about entirely: the "Medical Loss Ratio."
The law mandates that insurers spend at least 80-85% of ratepayer premium dollars on the actual delivery of healthcare services, or rebate the difference.
And while 80-85% efficiency is clearly not the equal of the 95% efficiency that both Medicare and the VA (both operated as single-payer enterprises) regularly approximate, it is almost exactly halfway toward such goals from the truly wretched 65% efficiency that was the industry average pre-ACA.
That means we're now giving only 15-20% of our healthcare dollars to duplicative, wasteful bureaucracy, advertising, bloated executive salaries, and Wall-Street-level profits (yes, even "not-for-profits" can and often do enjoy revenues in excess of costs; they just can't distribute them to investors as dividends), instead of the obscene 35% or so that was the case before.
This really does constitute progress, and should be appreciated as such.
6
Thanks for that. The explanation that a change from "Cost Plus" pricing to a market driven pricing clearly highlights that market driven pricing only works if individuals are in position to make choices and the cost of these choices are directly correlated to the individuals expense (not through spreading by insurance).
This seems economy 101. Reagan and his cohorts did understand it but his cohorts found they could milk the public with a market driven approach.
6
How mysterious can our extremely high healthcare costs be? This article obfuscates more than it enlightens.
It's time to stop staring at our navels and ignoring the clear methods other modern nations use to reduce their costs compared to ours by 40-50% (depending on your data source).
No more stalling for time- we need universal medicare and strong government regulation to keep prices down.
There are lots of other places corporations can go to gouge the public- can we at least keep unfettered capitalism out of health care where they do a particularly terrible job?
22
If we did it then we could do it again?
Or we could go to Single Payer/Medicare for All/Universal Healthcare and actually have a solution.
19
Single payer actually means Medicaid for all.
1
Reagan's deregulation of the health care industry was one incredible failure. When you are in an accident, there is no shopping for health help. You go to the nearest hospital, and then you fight the insurance industry. Before his administration did this, there were Blue providers - given they were monopolies - and they worked much like providers in Germany work. As an individual, you could buy in, as I did, at the same rate as corporations. Today, my daughter with top of the line insurance - in theory - is in a fight with her insurance and the hospital for 8 hours in the emergency room, multiple, and un defined tests - some of the docs were "uncertain" about the original tests so made her take them again, charged her twice for one med, it is just appalling. Our healthcare system is dysfunctional and Reagan had a big role in that dysfunction.
31
Until the Affordable Care Act of 2009, health insurance was entirely regulated by the states. The deregulation of the markets was done by the state legislatures and happened mostly in the 1990s.
1
During the Carter years, health care was regulated through "Health Systems Agencies" which monitored numbers of hospital bed, profits of facilities, etc. They could determine who could buy an MRI and how many were needed. they also were involved in paring back the number of hospital beds. HSAs as they were known disappeared in the Reagan years. For-profit hospitals were beginning to surface, btw, even before Reagan. this was particularly true in the psychiatric sector--many psych hospitals were poorly capitalized, often family owned and were struggling to to meet accreditation guidelines. For-profit psych hospitals started by buying existing facilities and then took advantage of deregulation to build new ones and develop niches like adolescent psychiatric care that never really needed to be very large. Psychiatric care in these facilities (and sadly, many non-profits) was tailored to insurance and generally maxed out whatever patients had. The difficulty people now have in getting private inpatient psychiatric care reflects managed care's tardy policing of all this which has taken things in the opposite direction.
2
Health care should never be for-profit. Period. Hospitals should be about the health of their patients not about profits for shareholders or millions of dollars in salaries for their CEOs. The rest of the industrialized world understands this...are we too stupid or too selfish to figure it out?
36
The best hospitals in this country along with the highest price for care is found in none-profit hospitals.
"Was the cheerful deregulator to blame for rising health care costs? A lot of readers seemed to think so."
A lot of NYT readers blame Reagan? For what? For....EVERYTHING. I'm sure a lot of NYT readers think it was Ronnie on the Grassy Knoll.
4
I'm sick to death of the conservatives that make Reagan out to be a great President. "Trickle down economics" and stuff like this. Even Richard Nixon talked about "Medicare for all."
24
Health care prices like almost everything else increased dramatically under Nixon. Remember wage and price controls?
1
Nixon's ability to have a substantive effect was limited, as is every president's ability--including our current president. Whatever Nixon's experience, he inherited the momentum from Eisenhower, Kennedy and Johnson. He deserved little credit and little blame, except for how he set up Ford, Carter and Clinton. A case can be made, however, that the time frame for effect has been condensed in the world of 24 news and immediate access to data, delivering perhaps a four year gap. George W, and his congress, almost single handedly delivered the great Recession to Obama and blamed his need to borrow on the Democrats. Trump deserves almost no credit for the current boom--it was going to take place under any president, Republican of Democrat. The real question, in my opinion, is how much wages would have risen if another tax plan had been approved--allowing Americans to close the gap on the cost of healthcare.
There's plenty of blame left for Reagan and his successors but remember, the bipartisan neoliberal hollowing out of the American economy started with James Earl Carter.
3
The economics of health insurance are illogical, but supply and demand works for doctors.
Insurance works if risk is distributed and unpredictable. Medical needs are predictably concentrated, by age and condition. The way for health insurers to make money is to spread risk more widely, by insuring the healthy, or by skyrocketing costs for the predictably sick. We don't like the former, so get the latter.
Then there's doctor supply. There are 141 medical schools in the US, which must be certified by the AMA (not the gov't.) There's demand for 30,000 MDs per year. They graduated 19,234 in 2017. The US has 2.57 MDs per 1000 population. Germany, 4.78. France, 3.24. Denmark, 3.66. US medical education is regimented and absurdly expensive. Fewer doctors with larger debt = more expensive.
The ACA was, in truth, a regulatory effort. Quite logical, given that the alternative - single payer - is a non-starter in the US. When an enterprise has so much importance, regulation is critical. The Swiss succeed in keeping costs down and outcomes up by treating health insurers like regulated utilities. That was the long-term goal of the ACA, not "socialized med."
8
I wonder what would happen to the cost of health insurance policies if their parent corporations were taken out of the stock market and regulated like utilities with an allowed profit margin tied to the inflation rate like my Social
Security benefits .
10
Given that turning 20% of GDP is like turning an aircraft carrier, your idea is probably the least-worst solution available. It could be done in a world without extreme partisanship.
Reagan's tax reductions for the wealthy have exacerbated the negative effects on society of exorbitant salaries and benefits, probably more so than deregulation.
12
All the wise commentators looked at the surface and did not delve going into the causes of our expensive and failures in medical care. The zeitgeist toward the commercial market paradigm in health services is faulty primarily because so many who need medical care cannot financially participate, that' way we got Medicare in the first place. Furthermore as the conservative Nobel Prizing winning economist Kenneth Arrow demonstrated back in the 1950s the conditions of the participants in medical care delivery make a very imperfect market for many specific reasons. (For example, the patient commonly lacks needed technical knowledge, judgement and the ability to shop around.) Furthermore a nation has to decide whether to consider medical care "an investment" in the capabilities and 'freedoms' of its citizens or a current expenditure - consumption. Thus the neoliberal, free marketeers in health care, making false analogies to automobile care and insurance, and craving theoretical efficiencies promoted an expensive, inefficient system - with as much as 30% administrative overhead - and many local and systemic monopsonies which soon turned to the gleeful extraction of 'economic rents' that is, excessive charges. This is the way it remains today. As the Welsh family doctor Julian Tudor Hart said way back back in the 1970s, "The market is an outmoded way to destribute health services."
5
While President Reagan gets the lions share of criticism for deregulation, don't forget the role of President Carter.
For example, the Airline Deregulation Act was signed by President Carter in 1978. And Paul Volker, who broke the back of inflation in Reagan's first term, was appointed Fed Chairman by Carter. And of course, Democrats had super majorities in the House and Senate.
1
Health insurance companies are also "looking for new sources of revenue" to deal with this situation. My wife had an MRI which we paid for up front to get a discount. We want the insurance company to accept this payment as part of her $6,000 annual deductible for Obama Care Silver coverage.
They are arguing that the provider was "out of network" even though they pre-approved the provider. Now we have daily calls with the insurers customer service reps to walk through the corporate merger of the company that did the MRI, which is in-network, and the new parent company, which is not (it's a new corporate entity).
The premium my wife pays is $1,200 per month and her company is denying her claims.
12
Why did American health care costs start skyrocketing compared with those of other advanced nations?
It's undoubtedly due Regonomics craze for laissez-faire economics of letting the market to self regulate. Result is rampant crony capitalism. Also that US didn’t impose government cost controls on health care and invested less in social programs that also promote health, a typical law of the jungle following Darwinian fittest survival, cruel capitalistic mentality of profits at any cost.
Having realized the fundamental flaw in Laissez-faire economic order French economist Thomas Piketty came out with a brilliant book Capital in the Twenty-First Century , focusing on the wealth and income inequality in Europe and the United States since the 18th century.
The central thesis of the book is that inequality is not an accident, but rather a feature of capitalism, and can only be reversed through state interventionism. The book thus argues that, unless capitalism is reformed, the very democratic order will be threatened.
Very democratic order is indeed in deep trouble, looking at the chaotic turbulence we see under Trump.
America's fate is not just an accident produced by the system. It is a consequence of that system.
15
The rise in health care costs also corresponded with the shift from a non-profit, charitable-based model to a for-profit model which was allowed by federal regulation. Once this started, everybody started making decisions all about money and boosting revenue.
The whole system is a joke. Prices are the core problem. Just look at this data from Indiana. Please tell me how in the world an insurer would pay three times Medicare for the same services?
https://www.rand.org/pubs/research_reports/RR2106.htm
Hospitals will say that they have to get this much money because Medicare doesn't pay enough. Hogwash. Since hospitals do not need to compete on the basis or price, they are inefficient, poorly run enterprises that care not a whit about affordability.
7
But how do you know that Medicare does not pay enough for a hospital to operate at reasonable profit (of say 6% per year)? I think that different hospitals are in different positions. A full service public hospital in a poor area may lose money while a hospital in a wealthy area with many people paying with private insurance may be making very high profits.
A system of regulation that assures reasonable profits but prohibits excessive profits may be the better way to go.
5
Everybody knows that Medicare doesn't pay enough--that's why many doctors refuse Medicare patients. Reasonable? Right now, the entire system is zero sum--an actual war between the factions where patients are at war with the healthcare industrial complex--including their own doctors. Six percent? Why not 50%, or 1%? The only reasonable alternative is a revenue neutral model where patients have easy access to procedural pricing and where the federal government steps in to make hospital's flat-line whole, with an emphasis on rural hospitals (I live in a densely populated area where healthcare systems are making money hand over fist). The current system is ridiculous.
Actually almost all doctors accept Medicare patients. Some accept the Medicare rate and others don't, which allows them to charge up to 15% above the Medicare rate. Most doctors who don't take Medicare are in specialties that don't see many elderly patients, like pediatrics, OB/GYN and psychiatry.
“What the market can bear” is a principle of USA capitalism that we hear and people often think it doesn’t apply to them individually.
When it comes to health care prices, this principle has everything to do with what we pay as consumers of health care.
Here is why.
It is all about what value, in USA dollars, we assign to our bodies and all its constituents parts. If we think that our bodies have infinite value to each one of us, the market will likewise decide that you will pay an infinite amount, in USA dollars, to keep your body healthy.
Take dentistry for example. The USA is alone when it comes to our obsession with perfect teeth. That is the reason why dentistry is so expensive in the USA. We value beautiful teeth infinitely. And, so the market obliges because the market already knows your teeth are valuable to you. That is also why dentistry is so cheap outside the USA.
It really is that simple. I think.
2
Yes, the beginning of The Beginning and The End for America.
Hello Russia and China.
3
September 1980. Ronald Reagan and the Republians steal the election by colluding with the Iranians to not release the hostages until Reagan is sworn in (sound familiar democrats, you can start doing something about this any decade now.)
It was the beginning of the end of America.
It's almost over.
30
“But we also put some brakes on Medicare in that decade. In addition, managed care slowed growth in the private sector.”
"If we did it then, we could do it again, she added."
Reminds me of the joke about the drunk looking for his keys across the street from where he dropped them because that was where the street lights were.
Medicare has been nickeled and dimed for decades - go after the health care profiteers: the lecherous private insurance sector.
19
But what hasn't changed is this - people still want the most and best health care .. that someone else's money can buy.
6
Living there for 13 years, I had much better, more responsive, more comfortable healthcare in Singapore at a fraction of the cost. A fraction.
The major difference between Singapore and U.S. is that Singapore does not have much of an insurance industry. The government negotiates rates; people mostly pay cash; high-end doctors still can afford to drive fancy cars.
9
Two cost-raising phenomenae:
Consolidation as giant mega-hospitals buy up smaller ones. Example: Cleveland. If you're looking from a high enough building on the east side, you can look out onto the two behemoths that have bought up the dozens of hospitals in northeast Ohio. On one side is the Cleveland Clinic, and on the other University Hospitals, each slowly taking over city blocks like ravenous amoeba, with all of the suburban hospitals in either one camp or the other.
Another example of consolidation: networks. These days, all the doctors belong to networks, and usually of either one or two in an area (belonging to....the aforementioned monopolies). If you don't want to change doctors, you may get stuck with a higher-priced insurance plan simply because of network affiliation.
7
Missing from this article is an analysis of where the medical care dollars are spent. From the articles that have been published during the decades since Reagan it would seem that more-and-more medical care is being done in Emergency Rooms with preventative care either staying static or declining. Part of the problem is that the ER visit is often to address a crisis from an unmanaged condition that got out-of-control.
Also missing is a discussion of the “Charge Master” that medical care providers use for initial billings for care. Of course, when the provider has a contract with an insurance company the actual price is nowhere near the Charge Master rate. However, for those without insurance, the full Charge Master rate is applied and is generally non-negotiable for an individual. Also, accepting less than the Charge Master allows the provider to claim a business loss.
7
According to a 2016 AMA report, about 32% is spent on hospitals, 16% on doctors, 10% on drugs and about 6.4% on net insurance premiums. The balance of the healthcare dollar goes to nursing homes, the V.A., home healthcare and other various and miscellaneous expenses.
Perhaps with the exception of hospitals, the problem is that to get prices under control you have to ask virtually all sectors of the healthcare industry to accept less. Politically speaking, that's not happening.
I had been un-lucky enough to move to the USA to practice in the mid-80's. Computer billing had become ubiquitous, state and local payers, started to cut services. HMO's decided to limit and the number of providers, and who could be a provider. This began the era of multi doctor corporations, the decline or almost impossibility of private practice. Office staffs, ballooned to chase claims, and trying to get paid. Net profits headed south, I headed back north, welcome the single payer Canadian system.
28
Deregulation in monopolistic systems don't work, "Econ 101". Anyway, that is what Republican politicians keep selling and Americans keep buying it... Snake oil.
31
The American hero rarely chooses reason over so called freedom. It's high time for a new male-archetype that does.
5
l like it when the Times does follow-up stories like this...fact-based and very informative. Thank you.
12
Also the huge rise in new meds, new technology and new procedures that have been developed since Reagan needs to be understood. It just costs a heck of a lot more to keep people elderly like me alive. 50 years ago I would be dead.
7
I work on health care policy on Capitol Hill. I never use this story in my work, because one good story does not equal a data set but:
When I was 11 in 1967 I broke my foot while playing. We went to the ER for the x-ray but then our doctor met us in his office on a Saturday and with a basin of water, and plaster and gauze he put a cast on my leg.
We had what was typical insurance for the 1960s: "major medical" insurance. It covered hospital stays and surgery. So, Mom wrote a check for $250 and scolded me over the cost - it was what what she would spend on groceries that month. 6 weeks later, back in the doctor's office, he cut the cast off with shears.
50 years later I broke a bone in my foot again. I have NO idea what the cost was - I have generous coverage.
But I can tell you that I saw my internist, and my foot was looked at by both an orthopedist and a podiatrist. The two casts were put on and taken off by a well-trained technician...and there were three rounds of x-rays.
17
Actually your feet have a lot of small bones and you want them to heal properly and you are much older( healing takes longer, old bones) so it was properly good that your foot got so much attention- being free to walk pain free is a blessing. Ask my old knees!!!
6
And the comparative outcomes?
2
Robotics will apply to these kinds of issues. Of course, may not lower costs. But could.
The people who really get squeezed in this country are the ones who make too much to be eligible for government assistance, whether it be for healthcare, food, housing or any other means based program. Wages have stagnated for over forty years. It doesn't take a genius to see the cause and effect relationship between Republican policies and the decline of the middle class. It's ironic that "welfare queen" and "strapping buck" Reagan led the country to a place where we have the lowest worker participation rate in years. It's more true now than then that the benefits of "loafing" outweigh those of working a McJob. People won't admit that, especially whites, it's easier to individually reap the bennies and point the finger at the out-group. As for the oligarchy that has taken over the government, the way things are are by design yet they still don't have enough. La plus la change...
13
I have one better for you. It is a true story.
I was twelve years old and I lived on a very large cattle ranch in South America. I had a bad molar with a cavity so deep that it was causing extreme pain because the nerve was now exposed.
My father took took me to the nearest dentist who was over 20 miles away. It was a very primitive facility that lacked anesthesia.
The dentist sat me in the dentist chair, gave me a choke hold, and in what seemed like a flash, he ripped the molar out with a very shiny instrument, that looked like a pair of pliers, and the pain was instantly gone. I said thank you to the dentist and smiled to my dad.
The procedure cost nothing. The dentist was a friend of my father.
Fast forward to today. I am a huge advocate of American obsession with beautiful teeth and all modern pain free dentistry. And, whenever I encounter a friend who is afraid of USA dentists, I relish telling them my story.
I have purchased my own health insurance since age 22. Nothing makes my blood boil and gets me upset like health care. I now pay $760.00 a month for insurance. Not only have my premiums skyrocketed, but the co-pays, deductibles, and benefits are now worse than ever.
Why do people stand for this, it's almost a joke that we don't demand something be done. Are enough people being provided insurance by their employer and by the government that I am just a minority these days? Some days I feel like working the bare minimum so I qualify for Medicaid or medicare.
Once when I lost my finger in an accident (I have knack for injuring myself) I sat in a small town ER waiting for care. I finally threw a fit and demanded help. A nurse apologized saying that everyone was trying to figure out what was wrong with an overweight woman who had no real issues other than being in poor health. They couldn't just send her out the door without doing every test imaginable for fear of being sued. That's health care in america today.
21
The people don't count anymore, except the people that are corporations and can funnel money to the politicians.
3
This is included in Alex Gibney's fantastic documentary Park Avenue, which is streaming free on PBS's Independent Lens section. Gibney does a fantastic job of connecting all the dots to show how our current societal inequality was deliberately engineered by what can only be described as a sociopathically greedy .01% and the sociopathically corrupt politicians (including Reagan) who served them. I really urge everyone to watch that movie.
13
Reagan's head was firmly stuck in the past at a time when the rate of change in business, technology, and the world-at-large increased at a logrhythmic pace. Like yours or your child's student loan debt? That was Reagan shifting the cost of education to the individual, who now piles up a lifetime of debt before he/she graduates. I could go on about how he sold us to industry and finance. Nixon put the R party on the path to racial exploitation and Reagan set the transition to plutocracy in motion. He was a charismatic ideologue who in the end had no idea what the country really needed, which was to think ahead instead of longing for eras that have passed and will not come back.
17
1980s: a watershed decade demonstrating the fallacies and inadequacy of economic theory in the face of a dishonest and wasteful nation unwilling to acknowledge its own flaws.
The epicenter of pronouncements about "free markets" and "the business of America is business" we were, in reality, the locus of greed and graft.
What economic system allows the wholesale theft of trillions of dollars of public goods, the "externalities" of theory?
What system can survive the substitution of avarice and corruption for the simple self-interest that drives the market toward the most happiness for the most people?
Or the deep malfeasance of the government that was supposed to provide robust regulation?
Or abandonment by the courts of objective legal behavior for bias toward corporate wealth and influence?
Ours is a flawed system: not capitalism, not free market, not democratic. And it began with Ronald Reagan and his misbegotten revolution. So the story goes.
Where it really began was with a Republican party already corrupt and focused on enrichment and lust for power, financed by the wealthy and the business sector.
Its where we get economic wonders like the ban on negotiating drug prices combined with an army of conservative economists shrugging their shoulders and wondering why medicine is so expensive.
Our problem is not lack of resources, it is our unwillingness to recognize that a person can be rich enough, and that people can be too poor; our unwillingness to share.
13
The Republicans have successfully managed to control our language when it comes to policies that help their constituency.
The word regulation is a perfect example. The GOP has convinced too many that the word has a negative connotation, when in fact, most regulations are protections, not restrictions. Think seat belts and the warnings on cigarette packages. Now think of what Pruitt is doing in the EPA--he is regulating, but in such a way that leaves us unprotected and his fossil fuel buddies regulating themselves all the way to the bank.
The Reagan administration's crusade to deregulate everything has left airline travelers in a mess and folks with medical issues in debt.
9
The Me Decade as coined by Tom Wolfe centered on the 1970s' attitude of self-realization. Yuppies personified the 1980s, so the 1980s would best be described as the Greed Decade, as the movie suggested with its "greed is good" line.
2
Our health care costs have been rising by more than inflation since 1960 and execrated under President Nixon.
We have a much higher cost of national defense than any other country and yet we are in more wars and have more young people disabled by war than almost every other Western Country. Health care is no different except we are unwilling to fund Universal coverage.
People with a good education are usually healthier and live longer. Maybe that's part of the equation?
We need to get our priorities straight. More health care spending, education spending and a tax system that reflects the costs. We outspend the rest of the world by a huge margin in military spending. That hasn't prevented casualties either.
You can't have a healthy society with a well educated society with Universal health care and insurance. That doesn't have to be all single payer but it has to be a national commitment. You also can't have more primary care without more primary care physicians. You can't keep your doctor if we don't have enough doctors when more people have coverage.
Educated people are healthier. Education will provide more primary care physicians that will allow us to commit to Universal coverage at a more reasonable cost.
3
what if people are too stupid to be educated, then what do you do?
4
I've worked in healthcare for a decade now, and while it's exciting to see some enormous advances in the understanding and treatment of diseases, our actual healthcare system is horrific.
The disparities in care by income/ethnicity, the fact that most insurance plans pay a fraction of the actual cost of "good" care, the mismatch of cost and actual expense, the competition between hospitals/academic medical centers that drives costs high, and my favorite target: concierge medicine, have contributed to "most money spent on healthcare" while achieving third-world outcomes in some poor neighborhoods.
And don't get me started on the mental health care sector. Anyway, the problems are myriad and the people to blame are everywhere. We value money over the public good. It's that simple.
17
Deregulation was all about higher profits and spending more money without the need to show better outcomes. Today we prices for basic care items like insulin double because deregulation and collusion has allowed price fixing. Deregulation was supposed to lower costs, as it has in the airline industry, but healthcare consumers don’t have the information, ability or energy to price shop.
4
Reaganomics also fostered the rise of managed care. The Reagan administration viewed most industries, including all mental health care services, as 'ordinary businesses'. In order to reduce government restrictions on 'ordinary business', the profit motive was introduced into health/mental health services to an unprecedented degree. Realistically,it resulted in the effective deregulation of all health care, including mental health.
Reaganomics asserted that deregulation of health/mental health care was in the best interests of the public. If the mental health care 'market' is deregulated, then bureaucratic government expense is greatly reduced. Health/mental health care costs to the general public should fall their theory says, and by encouraging competition and marketing among 'providers' for patients and clients, improvement of quality service should result.
In practice over the years since Reagan, it has rapidly turned to private self interest and profiteering by controlling and restricting all utilization and costs associated with health services in the U.S.Regrettably for all of our patients,clients and practitioners, the growth, development and survival of the managed care industry is based on its ability to shift away resources originally intended for provision of direct clinical services(includes all private practice,agencies,clinics hospitals,etc.), and redirect these resources to provision of its own services, needs, administrative fees and corporate profits.
13
Put another way, deregulation led to Scam America. Reagan was the Hoover of his time, asserting that business could do no wrong. Doctors do not support the insurance industry/pharma/hospital scam but the government does, for the scammers have friends in high places. Health insurance companies average about 25% in overhead, Medicare is at 3%. Tell me that isn't a scam in action.
19
Medicare is the single most-efficient delivery provider of medical services in the US, with an overhead / admin cost of approx. 2%. The vast majority of hospitals and doctors accept Medicare reimbursements for their services.
The solution to the runaway cost in US healthcare is actually quite simple - Expand availability of Medicare coverage to all citizens. If the consumer wants to purchase additional or differnt healthcare insurance, then they should be allowed to do so at their own costs.
46
All well and good, GTM, but remember that Medicare pays less than other payers, and, in general, does not pay enough to exclusively sustain a medical practice (including costs for utilities, rent, equipment, supplies, staff, mandatory computer systems, etc.), so most practices have a certain percentage of Medicare patients that they deem acceptable in their "payer mix" (usually about 30-40%), and many will refuse to see new Medicare patients if their proportion goes above that.
If you increase Medicare coverage by a substantial amount, then you are likely to create a situation where patients have coverage, but cannot find a doctor who will accept it.
8
Medicare now takes in only 50% of what it pays out. People forget that Medicare was originally set up, as to those collecting were paid for by those working at that time. That worked fine when there was 25 workers for every one collecting, now its? I have read its now about 4 to 1. The rest comes from the General Fund which is helping to push our deficit spending. Covering everybody with something like Medicare would just push the country faster into bankruptcy or demand a huge tax increase. Some Medicare facts http://www.politifact.com/truth-o-meter/article/2013/feb/01/medicare-and...
3
Dr. Uwe Reinhardt would often write in his NYT's blog about the rise of healthcare cost in the United States in addition to the disparities that exist between the US and other OECD nations. The debates in the comments were intense. But often what the discussion came down to was the unwillingness to share the burden of healthcare cost with each other. -- the notion of "we are all in this together." Dr. Reinhardt believed that the lack of social solidarity is what prevented us from putting together a better healthcare system.
I agreed with Dr. Reinhardt's thesis. But, I don't remember him offering his beliefs why our country lacks the social cohesiveness of other OECD countries to fashion a better system. So let me give it a try -- racism. I offer the racially charged debate over the ACA and the election of Mr. Trump as proof. There are too many Americans, who believe that "those people" aren't worthy of equal protection and opportunity under the law. So social programs that would benefit everyone are easily defeated if the "corporate money rich" convince racially triggerable Americans that those programs will benefit Americans who don't identify as white. So I will conclude by saying, if you want a fairer, reasonably priced, healthcare system then you have to fight against bigotry in order to increase societal cohesiveness. Once we reach a tipping point where we believe we are all in this together, implementation of healthcare cost controls will be politically feasible.
88
You're correct of course. But race and other 'wedge' issues are too politically useful to the right wing who essentially
represent corporate America. Of course we're not alone in this, as is exemplified by the politics of eastern Europe. And also it is not exclusive to there right although they specialize in it.
13
Since the huge majority of those collecting medicare are white your argument is false. The majority on welfare is also white. Healthcare cost controls? Like what? Price controls? There is a shortage of doctors why? Because they don't make like they use to and its not worth the cost to go into? Price controls on meds, new technology or procedures? Who would work on these things unless there was a profit to be made? You think government would produce a car as good or lower priced than GM and Ford does? Me, I dislike seeing those looking for handouts and getting freebies, healthy enough to work, when I see numerous signs for jobs and know there are many working two jobs to make it. This grocery shopping day i will see the same young guy, with a homeless sign, standing near the store offering work and every once in-a-while, he is sneaking a hit off a cheap vodka bottle.
2
@JDSept: "Since the huge majority of those collecting medicare are white your argument is false."
I believe this is called "unintentional irony".
I would add to the mix the Emergency Medical Treatment and Active Labor Act of 1986. This was a wise and humane piece of legislation, except that because there was zero funding it placed a financial large burden on the hospital system. As the hospitals had to make up the costs imposed, they raised the fees for everyone else.
19
Say it loud: UNFUNDED MANDATES. They are very popular amongst liberals but have largely led to disaster. I am in favor of EMTALA but to impose it without funding was a tragedy.
2
Thinking about the change to a more profit motive healthcare industry I recall that one of the best performing stocks in the decade of the 80s was United Healthcare at like a 10,000 percent return just above Microsoft from a return perspective if you had owned both stocks at the start of 1980 until end of decade
11
Why wouldn't healthcare stocks rise with a population aging and needing more healthcare? We live how long now? people invest to amke money and healthcare is a good one since it is growing.
1
Reagan was a transformational President, great for the country and the world in ending the Cold War as it existed then and responsible for spreading freedom across Eastern Europe and Central Asia (although some of that credit should go to the senior Bush), but his impact on the US economy has been lasting and very negative - large deficits, rising medical costs, huge tax cuts which favored the rich, increasing the gap in society between the rich and poor, rising power of corporations, slower growth in wages, all go back to the policies of the Reagan years. It is a sad legacy. We are more divided and polarized because of him.
55
I agree 1000%. Reagan is highly overrated. During his presidency, the US went from being the largest creditor nation to the largest debtor nation. Even his "defeat" of the Soviet Union is debatable; the latter probably would have collapsed anyway due to internal inefficiency. He was personable, so people liked him. But that didn't make him a good President.
25
Ronald Reagan was a horrible president. His handing over health care to the profit motive was just one of his errors. He began his presidential campaign in Philadelphia, Mississippi, which was known for just one thing: the murder of three civil rights workers by the KKK. But instead of condemning that racist violence, Reagan gave a speech in which he praised "states' rights", while remaining silent on civil rights.
Reagan is the man who campaigned hard against the establishment of Medicare in the 1960's, claiming that it was "socialist."
Reagan was backward and wrong on just about everything he did. No surprise that he was so horribly wrong on health care as well.
27
A helpful, simple tutorial on the end of the Cold War. Unfortunately, the only real part Reagan played in ending the Cold War was in taking credit for it.
http://www.ushistory.org/us/59e.asp
22
I have never comprehended why it is so difficult for USA voters to understand that a Capitalist for-profit health care system is, by definition, not healthy for any patient, including those who can pay any price for it.
Let me explain the logic. If automobiles were priced using a healthcare model, the cheapest car would cost over $500,000 [based on current value of having and raising a child] and replacing a tyre would cost as much as having hip replacement surgery. That is because Heath care is priced according to the value, in USA Dollars, that individuals perceive their bodies are worth to them
25
Not true. cars are what they are because of numerous companies in competition for that dollar. "Heath care is priced according to the value" really? Its not because of the high cost of new drugs, new technology and new procedures? Never mind the cost of educating medical personal? You want to carry the debt load of a graduating doctor? The guy replacing my tire might make 20 bucks an hour if lucky and is low skilled, while those it that operating room are highly skilled all together get how much an hour? That tire costs perhaps $100, that hip replacement device cost from 2000 to 12,000 from a quick google. That tire is produced how many an hour by an assembly line that hip replacement device? Probably more tires are sold in a day than hip replacements in a year. i have bought so many tires but not one hip replacement.
1
All true. But, you didn’t answer my question. How much, in USA dollars, do you think your body and your life are worth to you? And, how much are you willing to pay to fix your body regardless of what it cost to train all those Doctors and develop all those technologies and drugs needed to keep your body healthy.
That's because doctors have a cartel and people who change tires don't. Imagine that you create ATCA (American Tire Changing Association) that requires anybody changing tires to go to a school accredited by them. The school costs $200,000 but then you can charge $1,000/hr. to change tires. Nobody NOT accredited by ATCA is allowed to change tires. This is how it is right now with the doctors. Moreover, the case of bad diagnostics and no or bad treatments are frequent. If my car is misdiagnosed I want my money back. With doctors, good luck. I was born and raised in a former communist country in Eastern Europe, and I can tell you that when it comes to healthcare US combines the worst of socialism and capitalism. Want a true free market? Open US to doctors from India, China, Eastern Europe. Then you will see their salaries determined by the market.
P.S. Thank you US for allowing somebody like me who came in this country with $500 borrowed from his uncle to close on $2MM net worth 24 years later.
"Mr. McDonough pointed to the Federal Trade Commission’s 1978 decision to allow direct-to-consumer advertising of prescription drugs. "
I've seen, in the NYT reporting of the subject, three different dates on when the FTC allowed direct advertising of prescription drugs to the general public. 1978, 1983 and another in the 1990's. The above quoted sentence seems an awfully simplistic treatment of the subject.
3
Never mind that. It's the FDA that has authority over drug advertising, not the FTC.
Here's a good article with a history of Direct-To-Consumer-Pharmaceutical-Advertising (DTCPA):
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3278148/
1
I can't get a bead on the exact year it happened, but I think 1983 sounds about right. And it wasn't just drugs -- it was also doctors AND LAWYERS. And it started somewhat slowly and then exploded by the 90s. Today, you could effectively PARODY the average commercial, which pushes for some fancy-named drug (but then the narrator rushes frantically through a list of horrific side effects, including death!) and insists you "ask your doctor for it!"
Sorry, but it is obscene to hawk drugs this way. My real question: why didn't Obamacare rescind this law, and ban all medical advertising (*except public health messaging, like "stop smoking" ads).
1
To all those who've never seen the film "Sicko" -- I highly recommend it. In fact, I believe "Son of Sicko" is long overdue.
Health care costs are astronomical in this country. I don't feel for a second that my wife and I are paying for "health care."
No, we're paying protection money to the mob. The mob that is the insurance industry. We both recently turned 60. She has asthma and I suffer from chronic pain. Those are our ONLY health issues. Yet last year, we paid more than twenty grand for insurance.
I call it blackmail or extortion. All that money does is go into the insurer's deep pockets on the off-chance that one of us comes down with some catastrophic illness.
But the fact is, hospital costs in this country are so out of control, one cannot afford to take the risk and they damn well know it. Considering the government's answer to the opioid crisis was to severely limit the amount of medication I'm able to receive, I'd almost welcome a catastrophic illness at this point.
How on earth is it that the wealthiest nation in the history of mankind allows the "health care industry" to make billions off the sickest among us? It is morally destitute and evil. Period.
124
You are correct that a big part of the problem is the health insurance companies.
A Universal Heath Care insurance program would help you and others like you.
14
"How on earth is it that the wealthiest nation in the history of mankind allows the "health care industry" to make billions off the sickest among us?"
Maybe even that wealth is just covfefean. Fiat and so forth.
3
There were and are multiple problems in the US that began in the 1980's that still plague us today. Inflation adjusted wages for the bottom 80% are the same as they were when Reagan was elected. Bipartisan environmental and natural resource protection began a long decline that has not stopped since Reagan was elected. Distrust in every government institution good or bad has increased since Reagan was elected. Religious interference in public law and private lives has increased since Reagan was elected. The decline and fall of many parts of America can be traced back to the start of the Reagan era.
40
I remember in the 50s and 60s not only doctor's visits to our house, but also when we received a bill for treatment my lower middle class family could actually pay the bill..
32
They stopped delivering milk also. In the 50s and 60s my state university for undergrads and med school was free. Now its well over 200,000. People died at what rate in hospitals compared to now? I can remember my grandparents and their fear of hospitals in the 50s. Why? Few came out. Cancer survival rates, now vs then? Same illness as in the 50s but also same meds. same technology and same procedures you will pick then over now? Good luck. Lower middle class didn't pay then or now. Insurance did exist as it does now and government picks up a huge part of the tab for the bottom classes now. Try looking at the income tax rates of then vs now. Way lower.
Insurance did not stop that -- DOCTORS decided it was too much trouble and not a good use of their precious time to actually go out and see patients. It was more "financially efficient" to have patients come to you -- even spewing germs on your other patients -- and wait in the waiting room, until they got 10 minutes of your rushed, impersonal time.
Note that the doctors who came to your house....earned good, but moderate wages, and were not Richie Rich types as today's doctors are with six figure salaries.
2
In the 1980's many pharmacies became computerized, which made compiling medicine or product use possible. PBM's began going to manufacturers asking for rebate payments for preferred status on their formulary. These payments hasten price increases on the medicines they make, which down the line trigger increases in our premiums, deductibles and copays. The life of the contract and formulary status runs out and these are all up for bidding again, with those medicines now at a higher price than previous.
We should give long consideration to the effect of companies collecting payments from manufacturers of products we have to have. This is manipulation of our data to generate profit, and we pay through the nose to let it happen. Very little changes until this is addressed.
10
Austin Frakt believes that we should once again, we should "put some brakes on Medicare."
What we should do is what Austin Frakt and the conservatives in The Upshot refuse to consider: create a non-profit, government-run, single-payer health insurance system.
The reason why America began to fall behind in the 1980's is that the other countries of the world went to such a single-payer system, or systems that emulated single-payer with strict price controls.
Let's see The Times implement a system of balance in its columns, instead of silencing the voices of real reform.
36
Government runs what well? Other countries? Waits in Canada are what? People flock here or run to Europe for care? Price controls, does that mean wage controls also? There is a shortage of doctors why? The cost to being one? Profits means innovation and new meds, new technology and procedures. Try looking at Greece, Italy, Spain and how they are doing as to debt vs GDP.
1
Liberals simply must stop saying this. Only 3 nations on earth have single payer -- Canada, Singapore and Japan. NO NATION IN EUROPE HAS SINGLE PAYER. They have a wide variety of different plans, from non-profit insurance to the socialized medical plan of the UK's NHS. But NOT SINGLE PAYER.
I have no objection to a well run single payer system, but it is absolute nonsense to say "everyone has this". It is simply not true.
4
JDSept -- those other countries have democratically elected governments and have not seen fit to chose the American model of health insurance. Why do you think that is? Even right wing, by their standards, governments keep their health systems. You know why? Because they wouldn't be in power any longer. The people would run them out on a rail. We Americans may be exceptional, but when it comes to health care and payment systems we are exceptionally stupid not to learn from others, such as the Scandinavians who have figured it out a lot better than we have.
The political will to address the runaway costs of healthcare in a humane and thoughtful way, including Medicare and Medicaid spending, enormous contributors to the Federal debt, is lacking, and private sector solutions are piecemeal at best, so one wonders if a catastrophic collapse is on the horizon.
Sadly, what appeared to be a simple solution, deregulation and the introduction of market forces in the healthcare system failed; partially because competition was circumvented by providers and societal ills created an unexpected increase in demand. But, by all accounts, other countries have manageable systems that lean heavily toward socialization, so maybe we can find our way.
As always, good leadership is the key. That's missing now. Yet, I imagine that good people will answer the call, and save us from more pain, suffering and eventual collapse.
8
I live in France and I'm so glad that I do! The health care system here is not perfect, but it's vastly superior to the US system. Doctor's fees are regulated, charges for testing are regulated, prescription drug prices are regulated. I have a "carte vitale" with a chip inside, so that when I see the doctor she plugs in the card and all records of any medical services I've received come up on her screen. The doctor's appointments are made via an answering service, and there is no one in the doctor's office other than the doctor herself.
Last year I had hip replacement surgery, and having chosen a private clinic and well respected surgeon my out-of-pocket expense was 500 euros for the doctor, whose fee was greater than the government reimbursement amount. The pre-surgery testing was extremely thorough, and preparation was made to minimize exposure to hospital transmitted infection. One week in a rehabilitation clinic as well as 16 physical therapy sessions after discharge.
The Carte Vitale (CPAM) doesn't cover everything so most people buy a supplemental policy (mutuelle) to cover extras and providers like chiropractors and acupuncturists. I chose an expensive one - 1200 euros per year. I'm 70 years old.
I doubt that the US could ever replicate this system - things have just gone too far for any going back. Kind of like the gun ownership thing - no going back.
84
You would have had a similar experience in the USA under Medicare. I had hip replacement 4 years ago with a small out of pocket cost and excellent care and outcome. I also had a wide choice of surgeons as almost all accept Medicare reimbursement in my area. The problem is that Medicare is not universal and private insurance provides a very different experience often with very large deductibles.
7
Alanln: I don't doubt you had a good experience, but before moving to France my home was in Seattle, where I constantly got the message "the doctor doesn't accept Medicare" when searching for practitioners. Another comparison: in 2000 I had a hysterectomy in Seattle. It was covered by insurance, but I saw the bill - $31,000! And the hospital food was terrible - broccoli was actually spoiled. In 2010 in France I had a thyroidectomy, including 2 nights in hospital with good food. The price, which I paid out of pocket was 3,100 euros.
I also live in France and I can attest to the superiority of the French system. Unfortunately, however, it is being threatened by the same forces that destroyed the American one. President Macron is out to employ the same destructive policies that have failed in the US driven by both ideology and his nearness to the world of finance and industry.
9
Our country began it's slide with R. Reagan. Profits over people, the wealthy over workers, the human beings in the GOP lost to the plutocrats. The bloated healthcare insurance industry and the bloated crazy access to healthcare have caused this huge mess and it's not getting better.
26
K Street rules.
Our federal legislators, and to an extent, our state legislatures, are for sale. And those who have monopoly power have the money and the lobbyists to buy off the bulk of those who vote.
Take money out of politics, return us to a nation with a draft and and national service, and soon this pricing of the poor out of medical care, housing, and food goes away.
I write this confident that I will go to my grave never seeing the power of K Street diminish. There are too many souls who have been bought sitting in my Congress.
Hugh
17
1- No agreement on what we can and should be provided
2- No control of technology and labor costs
3- Americans think death is an option
4- Paid for by a third party
5- It is not like selling cars
6- Greed
11
1) tends to be by what YOu buy for insurance. choice don't YOU hate that? 2) labor costs? Lets control your pay. Technology? not allow innovation and new stuff? 3) death is always the final option same as always 4)They call them insurance companies. Don't want to use one? Don't get insurance. Again its CHOICE 5) its marketplace driven what has made America great. it is like selling cars. Who offers best product & service usually survives. 6) Greed is always jealousy of what somebody else makes. Greed investing in medical stocks which helps to produce what keeps others alive? Greed going 10s of thousands in debt to be a doctor?
The "Reagan Revolution" was predicated on concentrating power in capital and weakening labor, giving corporations, CEOs and Wall Street the power to increase profits at the expense of working people and the poor. A lot of working people, especially but not exclusively white males, lost earning power but supported Reagan anyway, apparently because they felt Those People were picking their pockets. In fact it was working people who had their pockets picked as the great American middle class began its decades-long decline and corporate profits and elite incomes soared. That process continues, abated by Democratic "triangulation", which was basically an agreement to abandon working people by both parties.
55
The trend is that premiums, deductibles, co-pays, co-insurances are rising and coverages are falling. This problem, which is dominated by adminstrative costs/profits, is unsustainable. Every other country has figured it out: single payer, universal coverage. The only debate should how we get there.
20
The biggest life-threatening mistake made by our country was allowing healthcare to become a price-gouging for profit empire for healthcare providers, and a limitless revenue stream for insurers.
When a patient is unfairly denied an insurance claim, who fights for them?
When a hospital charges ten times what they should, who comes to the aid of the patient?
If the pharmaceutical company increases the cost of a life-saving drug by 1000%, who helps those in need afford it?
The healthcare industry has proven it cannot self-regulate.
Pathetically our Congress, far too many of whom are bought and paid for by healthcare lobbies, puts power/greed above patients at every turn.
The disease lies in lobbyists, super pacs and dark money. Until we stop allowing our politicians to be bribed, patients will remain in fiscal and physical jeopardy.
188
I think "greed over people" is too nasty a way of putting it. Capitalism is the source of America's historic success. However, it can't be applied to health care because the latter is not a commodity which can be priced according to what the traffic will bear. Instead, let's say that America hasn't figured out how to reconcile its capitalist DNA with the reality of a "product" that, in the end, is priceless.
6
Most states have an insurance overseeing board for complaints as to deniability. Hospitals charge 10 times what they should? How many are balancing on going under? How many do they serve who pay little or way under cost like for the poor and those on medicare and Medicaid which they don't recoup their actual costs? YOu show up they have to serve you. Drug companies have invested how much into cancer with not so great results so far, Trillions and trillion. Where do YOU think that money comes from? Healthcare is so good but to be so it is expensive.
1
It's not possible to blame any one entity or party for the atrociousness of our current healthcare debacle. Deregulation certainly didn't help, but decade after decade of inattention and pathetic attempts at fixing the problems have left Americans with this despicable state of affairs in healthcare.
I see firsthand how profit has impacted the quality of my healthcare. It's hellish and unconscionable.
When doctors are able to ration my healthcare to positively impact their bottom line, the problem goes beyond mere greed to one of questioning ethics and the incestuous nature of incentives given to doctors to control costs in their practices.
We must ask ourselves who the winners are in this scenario? It most certainly isn't the patient. It's insurance companies, medical groups and doctors.
While I appreciate doctors and their expertise, I feel the profit motive needs to be removed from our healthcare equation. Until we do this, costs will still skyrocket and patients will continue to receive, frequently, less than adequate care.
13
One aspect of all these comments zero's in on the same point: since the Reagan era greed ( call it deregulation if you need to ) has displaced compassion as a foundation of the American system. In the ensuing nearly 40 years this paridigm shift has redesigned our economic model our political discourse and turned our society into us and them. This cancer, like all untreated cancers will destroy us in the end. The only question is how much longer the patient can exist.
41
right, prior to 1980 this country was overflowing with compassion.
4
Saint Reagan is the genial Republican fiend who started this mess. Like all Republicans he was a bigoted liar who began the GOP plan of destroying the middle class and reducing Amerivans to serfs for his plutocratic owners. His aw shucks patina masked another nasty Republican opportunist and union busting thief. The perniciousness of his scandal plagued administration cannot be underestimated. Another good reason to unmask his phony record as America hopefully rids itself of Republican crooks liars and trap tots in the next toe elections.
54
Opioids (deregulation & greed) are now the leading cause of death for Americans under 50.
One more sign that Heath care cannot be a for-profit enterprise. Also, another sign that our government is corrupt and incompetent.
I don't see any chance of a change in Americans thinking about the relationship between government and health care. For-profit health care interests will never allow a fair debate over the expansion of Medicare-for-all. Why, becuase it is the only answer.
9
Yes, you are correct re your headline.
One could even argue it started before him with Nixon.
Deregulation and putting our health care system (not medicare/medicaid) into a near total de facto criminal private health care system unlike the rest of our peer countries has put us into the horrible place of having the most expensive health care by far with the worst outcomes re our peer countries.
21
Here is the bad news: The U.S spends 17.2% of it's GDP on health care!
Here is the good news: The U.S spends 17.2% of it's GDP on health care!
We do not have a resource problem.
We DO have an ALLOCATION problem.
The A.C.A. did little to address this problem, trying to keep the various "profit centers" happy and on board. This is where the real work needs to be done.
13
The ACA -- the 2500 law itself -- was WRITTEN by an insurance company executive, specially to benefit her industry and her employer and their profits. That is what your hero Obama chose to do! when he had all the power, a supermajority in Congress -- did not need even one Republican vote to pass ANYTHING HE WANTED. He had the opening of a lifetime, and he blew it totally, and now we have a system even WORSE, more costly and unworkable than before. THANKS OBAMA!
2
My bad internet typing: "the 2500 PAGE law itself" -- sorry.
Profitability and shareholder returns, and universal, patient-focused, wellness and healthcare are driven by different, often competing incentives.....a root problem with the US system that doesn't appear to affect other countries as it does here.
Also at odds is the view of those for 'smaller/less government', and the underlying concept of 'a greater good' for all as put forth by this nations founders.
The seemingly prevailing view of access to insurance and good care, among other things is: 'I got mine, the heck with you'. It's as much a cultural problem as it is a political view....one that seems to think profits over people is ok.
12
The root problem is fee for service. The more services provided, the more money is made.
Healthcare operates like micro monopolies to each customer. They don't know what they are buying, do to the highly technical nature of the product, don't know if they need it, can't shop the price, and if they reject the sale they may get sick and die. This is total inelastic demand. The sellers always get what they want. They can demonstrate that their "costs" must be covered, but their costs are all of the inflated salaries, perks and bonuses that the participants all receive.
The only way to manage prices with monopolistic commerce is with regulation. That's it. Until and unless we get rid of fee for service, put everyone on a straight salary, and get Wall Street out from between the physician and customer, prices will continue to rise.
12
If we had a Congress that was actually interested in providing services to its citizens, we could resolve these issues. But the rise of trickle-down economics with Arthur Laugher (pun intended) and his influence on Reagan brought a whole new (and fraudulent) approach to government service for the people.
13
The shift in care from hospitals to independent (of hospitals) outpatient facilities is what produced the cost savings for the simple reason the outpatient facilities were more cost efficient. But then hospitals expanded into outpatient care and independent outpatient facilities lost their advantage. No, they didn't lose their advantage in cost efficiency, they lost their advantage in reimbursement: hospitals, because they are so large, can command higher reimbursement rates from third party payers. What happened as a result is that many of the independent outpatient facilities affiliated with hospitals in order to take advantage of the higher reimbursement rates.
6
What this series has failed to tack so far is the fact that we should be able to determine which exact causes of death began to diverge in 1982 (the year showing the actual first divergence). Which kinds of deaths, in which age groups? And also the fact that depending on what these are, the seeds of divergence may have been planted several, or many, years before it showed up in 1982. That might or might not tell us much about cost divergences, but it's important information that could lead in unexpected directions, including cost-related ones.
2
One approach as others have ably suggested is to model the U.S. healthcare system on other major developed nation states. Alternatively, we can go full capitalist. Tear down all regulatory barriers to market entrance everywhere. Let Walmart and Amazon build their own market based healthcare systems. Actually, Amazon, Berkshire Hathaway and J.P. Morgan are doing that. But tear down that wall, to paraphrase Ronald Reagan.
Walmart already provides urgent care, why not go full Walmart? Instead of 200,000 for heart surgery, I am willing to bet that highly efficient very powerful corporate institutions can do it for 20,000 or whatever is the lowest cost found in other OECD countries. I think the can produce generic drugs for pennies, they can mass produce medical devices for a fraction of what others do. They can deliver full medical exams with drug tests, X rays and whatever else for what they charge in Latin America. In fact, Walmart might send people to Latin America or India or the Philippines to reduce the cost of various forms of medical, dental and optical care.
And let Walmart compete with...who ever is left in retail and other service oriented industries willing to enter the healthcare space. With three trillion dollars, shouldn't the private sector be able to create a manageable responsive healthcare sector? In theory yes.
1
This is probably simplistic. No one mentioned malpractice insurance. Jury’s in certain states were handing out multi-million dollar punitive damage awards. When your insurance rates go through the roof, you need to raise prices. Or go out of business. The federal government does not have to worry about that scenario. They can always print more money or Levy more taxes or, in our present version of congress, take from the blue and give to the rich.
5
Yes, thank you Ronald Reagan and fellow "free market is always best" ideologues for our exploding health care costs.
While a truly free and open market is generally the most efficient way to ensure ongoing improvement, better cost efficiency and innovation, it has to be "free and open" to both sellers (providers) and buyers. In health care, that just isn't so. Firstly, having a medical procedure is not like buying a new TV - the patient is at massive disadvantage, having to make the decision under duress, not having access to all the information required, and, even with all that information, not having the expertise to arrive at their own medical opinion.
Second, almost perverse incentives for health insurances to not control costs; for example, under the ACA (Obama care), the (private) insurers are allowed to keep a set percentage of the overall premium as profit. So, the higher the premiums, the more money they get to keep. Why would insurers try and control costs with that incentive?
Third, the overall goal of any insurer (for-profit and many so-called non-profits) is to take in more money than they pay out.
So, the absence on an effective market, incentive to raise premiums for insurers, and the concept of healthcare overall as profit-making enterprises combine as a perfect storm, in which we found ourselves adrift, listing or already sunk.
14
Additional problems are that trillions of dollars in highly valued health care stocks are woven into our economy, and that the health care industry is now the largest employer in the U.S. Thus, the immediate effect of reducing exorbitant prices and eliminating inefficiencies in the industry would be a loss of jobs and a drop in the value of our pension funds and stock portfolios.
Bigger profits also mean bigger "campaign contributions" for our politicians, translating into more talk but a mysterious lack of action.
9
Why is this article is written with such a tentative tone...as if there were some unsolved mystery about the abomination that is American healthcare...as if there was some complex debatable root cause of the great American healthcare rip-off ?
Look at the immoral, obscene numbers.
Country & % of GDP spent on healthcare
United States 17.2%
Switzerland 12.4%
Germany 11.3
Sweden 11
France 11
Japan 10.9
Netherlands 10.5
Norway 10.5
Belgium 10.4
Austria 10.4
Denmark 10.4
Canada 10.3
UK 9.7
Australia 9.6
Finland 9.4
New Zealand 9.2
Spain 9
Portugal 8.9
Italy 8.9
Iceland 8.6
Slovenia 8.6
Chile 8.5
Greece 8.2
Ireland 7.8
Korea 7.7
Hungary 7.6
Israel 7.3
Czech Rep. 7.2
Slovak Rep. 6.9
Estonia 6.7
Poland 6.4
Luxembourg 6.3
Mexico 5.8 %
http://stats.oecd.org/Index.aspx?DataSetCode=SHA
America has a right-wing vulture capitalist society predicated on Greed Over People.
The only meaningful way to regulate that insatiable greed and blood money is through strong government controls that reflect an honest interest in the well-being of the country's citizens.
Every other rich country recognized this very low bar of humanity decades ago, but America, driven by its inhumane capitalist cult of greed and stupidity, remains uncivilized with its healthcare with a rip-off system with middling outcomes that doesn't come close to the universal coverage enjoyed by other countries.
America should copy other countries' healthcare systems, not cling to its right-wing Greed Over People disgrace.
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Even more to the point, health outcomes (eg life expectancy) correlate well with per capita/GDP healthcare expenditure, with one glaring exception, the USA (https://theincidentaleconomist.com/wordpress/wp-content/uploads/2013/11/....
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Unfortunately Republicans do not view health care as a right but as a privilege for the privileged.
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Health care costs, primarily the costs of hospital, outpatient care, diagnostic facilities and drug treatments, are driven by many forces (demographics, innovation, expectations, safety demands, greed, inertia, medical-industrial complex largesse, uncertain clinical effectiveness, etc.) that are politically, economically and socially impossible to tame successfully, especially in sync. If we assembled engineers from MIT to built a system from scratch accounting for all these forces (i.e. variables) with the objective function to maximize access to 'quality' services (e.g. effective, convenient) at a cost which was less then 10% of our GDP, they could probably meet this complex challenge with a new model. It would probably involve an entirely new method for doing almost everything: restructuring the infrastructure, human resources, deployment of technology, funding and our perceptions/expectations of outcomes of service. However, executing the shift toward the model would be politically and practically impossible. In other words, we can probably conjure the system to work more effectively at a much lower cost, but we just can't get there . So, we are stuck with incremental progress at best. For this reason, its going to get worse until the economic support system collapses on its own. But we all know, there is a better way and getting there has been and will continue to be politically and practically impossible.
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With deregulation Reagan accomplished what he wanted to accomplish. He enabled the change in goals for the health care profession. Before deregulation the goal was more patient centered then with deregulation it changed to first not losing money to eventually the primary concern became making money. This change has caused the health of patients to be secondary to making a profit.
Reagan isn't solely to blame as he is was just carrying on Nixon's assault on the health care system and Carter opened up the deregulation door for Reagan to walk through. This will only change when the United States decides to put health care outcomes over profit margins, once this is accomplished you will begin see improvements in the quality of life for Americans.
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"The U.S. was unusually successful in smoking cessation, relative to other countries,” she said. “If we could replicate that success in other areas, like obesity reduction, we might close the gap in health care outcomes."
Maybe America's success at smoking cessation contributed to America's growing obesity? After all, people used to smoke to lose weight.
11
That's an interesting observation. I think there are multiple contributing factors to the obesity epidemic, but smoking cessation might well be one of them.
I wonder how much the restrictions on advertising for cigarettes contributed to the successes in smoking cessation. If it was that effective, perhaps we should stop advertising junk food. We can stop the direct to consumer advertising of pharmaceuticals while we're at it.
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Obesity starts with kids. The rate of obesity in children ages 6-11 increased from 6.5 to 19.6 percent in the years since 1980. In just 38 years, obesity nearly tripled for those under 18 years old.
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Why do we all need to live so long? If we were not so selfish to one another we could all enjoy our lives better and be content to go when nature/god planned for us to go. Quality not quantity.
Studies show that being nice, even faking a smile can increase your health.
Message me for my sources.
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