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a citizen’s journal by Thomas Nephew

These days, *having* health insurance can be as bad as not having it

Posted by Thomas Nephew on June 29th, 2009

The clip to the right, from a June 16 Congressional hearing, is via Christy Hardin Smith (at “firedoglake”), who joins Howard Dean and others in advocating a “public option” health care reform, and points to the “firedoglake” Public Option Whip Count Tool to help do so.

It is no doubt true that we’ve been gamed within an inch of our lives by a political process that took “single payer” off the table from the start — a tactic now regretted by one of its primary enforcers, Senator Max Baucus (D-MT). From David Herszenhorn’s NYTimes article (Baucus Grabs Pacesetter Role on Health Bill) of last week:

[Baucus] conceded that it was a mistake to rule out a fully government-run health system, or a “single-payer plan,” not because he supports it but because doing so alienated a large, vocal constituency and left Mr. Obama’s proposal of a public health plan to compete with private insurers as the most liberal position.

Even without details available, Obama’s “public option” notion is no silver bullet, as Harvard’s David Himmelstein* argued on the Bill Moyers Journal in May:

…most of the cost savings [Obama]’s talking about are really illusory, I think. And my research group has done most of the research work on administrative costs in health care. And the administrative costs he’s talking about saving are a tiny fraction of the potential savings under single-payer. ‘Cause hospitals have to keep their bureaucracy, if you’re dealing with hundreds of different plans. And doctors have to keep the bureaucracy in our office. You don’t actually get the streamlining that you get from having one payer that has one set of rules and can pay lump sum budgets to hospitals. But more than that, we’re worried that the public plan actually becomes a dumping ground for the unprofitable patients.

…because private insurors use tricks like second-floor or otherwise hard to get to signup locations to weed out the elderly or infirm from their lists. That said, were “public option” to become the insurance of choice, it might become a de facto single payer system, one that was able to achieve the savings in the long run that it can’t in the short run. Then again, it might not get that far. For more justifiable skepticism about Obama’s “public option” idea as compared to a “single payer” system, read Lambert or Avedon Carol (also here) and follow their links.**

But a public option might at least be free of the kinds of abuses Ms. Robin Beaton (the woman in the video) suffered through — worse even than so-called “rescission” for a nondisclosed prior condition, in that Beaton faced delay of benefits for a condition discovered after coverage began — while facing malignant breast cancer:

In May 2008, I went to the dermatologist for acne. A word was written on my chart and interpreted incorrectly as meaning pre-cancerous. Shortly thereafter, I was diagnosed with Invasive HER-2 Genetic Breast Cancer, a very aggressive form of breast cancer. I was told I needed a double mastectomy. When the surgeons scheduled my surgery I was pre-certified for my two days hospitalization. The Friday before the Monday I was scheduled to have my double mastectomy, Blue Cross red flagged my chart due to the dermatologist report. The dermatologist called Blue Cross directly to report that I only had acne and please not hold up my coming surgery. Blue cross called me to inform me that they were launching a 5 year medical investigation into my medical History and that this would take approximately 3 months.

Naturally, it got worse: Ms. Beaton testified that Blue Cross canceled her insurance; it was only thanks to the intervention of her Congressman that her coverage was reinstated — after having to wait for 4 months for surgery, while her tumor grew from 2-3cm to 7cm in size.  If her cancer returns and cannot be cured, it won’t be an exaggeration to say her health insurance killed her.  How many other Robin Beatons are there? How many couldn’t get their coverage back?

Whatever its shortcomings, it seems possible a “public option” could be a (relatively) abuse-free, predictable, transparent alternative to monstrous situations like Ms. Beaton’s — a safe harbor, not a dumping ground, for Americans who want reliable health coverage when major illness or injury strikes.

One reason for thinking so is that the health insurance business turns out to be massively concentrated; a recent Health Care for America Now! (HCAN) report shows that “[i]n the past 13 years, more than 400 corporate mergers have involved health insurers, and a small number of companies now dominate local markets but haven’t delivered on promises of increased efficiency. According to the American Medical Association, 94 percent of insurance markets in the United States are now highly concentrated, and insurers are thriving in the anti-competitive marketplace, raking in enormous profits and paying out huge CEO salaries.” (Via TPM).

One of the best ways of losing clients — if there were actual competition to lose them to — would be to subject them to the kind of thing Ms. Beaton experienced. While I’d very much prefer a single payer plan, it seems to me a “public option” could have real value, too, in preventing the kind of “pseudoinsurance” issue Ms. Beaton’s case illustrates.

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* Dr. Himmelstein is author of the study referred to in the prior post, showing that over 60 percent of bankruptcies in 2007 were attributable to medical expenses.
** OTHER persuasive single-payer over public option articles or resources: AZ League of Women Voters comparison; Robert Reich, though he prefers public option to the regional coop idea that has been floating around.

2 Responses to “These days, *having* health insurance can be as bad as not having it”

  1. RobertNAtl Says:

    The so-called “public option” is obviously too radical, but I could support a compromise where the government gets to invest a total of a trillion dollars in selected private insurance companies, all in exchange for a 1% ownership stake in those companies. Obviously the government couldn’t interfere in the management of those private insurance companies. I think if you coupled this approach with a decision that we then would not revisit the issue of health care for 30 years, we could get a bipartisan compromise that would attract the 2 or 3 Republican votes we would need for a truly bipartisan bill.

  2. Thomas Nephew Says:

    Makes sense! — just like with the bailouts, torture, and cap and trade windfall rights to pour CO2 into the atmosphere, “be nice to the perps” is the North Star of the administration and party I worked to bring to power last November. No doubt the other guys would have been somehow worse, of course. That’s the bipartisan genius (“bad” vs. “worse”) that makes this such a great country and the envy of all the world.

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