Subject: Voices in the Health Care Debate Date: Published: 2/16/93 (384 lines) Source: Wall Street Journal. Copyright Dow Jones & Co. Inc. Voices in the Health Care Debate Central among the national "sacrifices" President Clinton hopes for as he presents his economic proposals this week is reform of America's health-care system. To widen the debate, the Journal surveyed health-care professionals and activists, asking them to name the worst examples of the current system and the main focus points for reform. Excerpts from their replies appear below. SLASH REGULATIONS Much health-care inflation is actually regulatory inflation. Every agency proposing new health-care or drug regulations should cut existing ones so there is no net increase in its regulatory burden. This will require hard decisions. The consumer protection lobby, the American Medical Association, the Food and Drug Administration and the trial lawyers all have a stake in regulations where the benefit goes to them and the cost is borne by society. One regulation that costs society dearly is the FDA efficacy standard for approval of drugs for life-threatening diseases. By demanding rigorous proof of efficacy before approval, the FDA drives up drug prices, impedes development of new treatments, and condemns people with AIDS and cancer to die waiting for the FDA. James P. Driscoll Direct Action for Treatment Access San Francisco ALREADY RATIONING An 80-year-old patient arrived at my office complaining of frequent and uncontrollable urination. I performed several tests, prescribed medication, and helped the patient solve her problem. For practicing gynecologists like myself who see bladder problems in aging patients almost daily, there was nothing remarkable in curing the problem. What is noteworthy is that the bladder problem existed for five years. Since the patient was on Medicare, no doctor had taken the time to give her a full diagnostic workup and treatment. American medical care for the elderly is quietly being rationed by limiting reimbursements to levels where doctors lose money when they treat patients. This has obviously been one way for the federal government to quietly reduce health care costs. Yet no politician has yet had the courage to explain this dirty little secret to the American public. Managed care injects similar rationing. The time has come for honest presentation of the consequences of the health plans being formulated. Martin S. Goldstein, M. D. Obstetrician/Gynecologist New York SMOKER'S FEE We cannot talk seriously about health-care reform without a commitment to identifying the extraordinarily high costs of treating preventable diseases. Cigarette smoking causes nearly 500,000 of the estimated one million premature deaths annually. All of us absorb the more than $35 billion in costs associated with treating smokers who, at a relatively young age, develop cancers, pulmonary disease and heart ailments. Smokers should be assessed a "users' fee" (not a general tax that could be hijacked for other purposes) to compensate the system, private or public, for the inevitable costs of treating smoking-related diseases. Elizabeth M. Whelan American Council on Science and Health New York TAX CODE HURTS POOR There is, at this very moment, a working mother in America with a sick child. She hesitates to bring her child to a physician because she does not have health insurance and is already being hounded over earlier, unpaid medical bills. It is a common occurrence in our country, where medical bills have become a chief source of personal bankruptcy. Well-to-do Americans ought to be haunted by that imagery, and ashamed. Are we really to believe that our $6 trillion economy is too anemic to grant this hard-working mother, and other uninsured Americans, the financial assistance and peace of mind much poorer countries routinely afford all citizens? Premiums paid by employers for their employees' health insurance are not now added to the employees' taxable income. That feature of the tax code saves corporate executives over $1,600 a year in taxes, but low-wage employees close to nothing. Why not convert this fringe benefit to taxable income for employees earning, say, $50,000 or more a year? The tax could be phased in so that for employees earning more than, say, $80,000 a year, 100% of all employer-paid fringe benefits would become taxable income to the employee. With these added taxes, we could begin covering low-income, uninsured Americans, starting with mothers and children. Uwe Reinhardt Princeton University HELP SELF-EMPLOYED The self-employed are denied fair tax deductibility of insurance premiums. They can't invest in a self-insuring Health IRA and don't have access to lower group insurance rates. State mandates and excessive paper work requirements make insurance financially prohibitive. And if the self-employed or their families have costly pre-existing medical conditions, insurance is unavailable at any price. Repealing state mandates, a move toward community rating, and tax incentives for small business are just some of the achievable, rapidly implementable, and relatively inexpensive solutions to this problem. House initiatives on these issues should be reintroduced and passed. Jerald R. Schenken, M. D. Pathologist Omaha, Neb. REFORM THE FDA The Food and Drug Administration rules on drug safety. Yet far too many Americans die from unsafe drugs and foods. It rules on drug effectiveness. Yet it cannot act on drugs used safely and effectively in Europe for decades. This dooms thousands to unnecessary suffering and death. Why do such problems persist? The FDA bureaucracy locks up minds and paralyzes action. Too often prejudices against certain drug companies, or personal and professional jealousies and conflicts, hamper proper action. I urgently advise Hillary Clinton to: (1) fire the current FDA commissioner, Dr. David Kessler, all of whose actions seem politically motivated; (2) ask the attorney general to investigate conflicts of interest that keep vital drugs from millions of victims -- and make costs skyrocket; (3) ask Congress to hold public hearings at which experts could detail FDA failings and propose a basic reorganization of the FDA. Woodrow Wirsig Alzheimer's Activist Palm City, Fla. MEDICAL SAVINGS ACCOUNTS One reason health-care costs are out of control is that when we enter the medical marketplace as patients, we are usually spending someone else's money. Economic studies -- and common sense -- confirm that we are less likely to be prudent shoppers if someone else is paying the bill. Over the past 30 years the share of our income spent out-of-pocket on health care has actually declined -- falling from 4% of total consumption expenditures in 1960 to 3.6% in 1990. Over the same period, the amount spent from all sources has more than tripled -- rising from 4.2% of consumption in 1960 to 13.3% in 1990. To control costs, more than 200 members of Congress last year supported Medical Savings Accounts. Tax-free deposits could be made to these accounts, which would be the property of the employee. Money could be withdrawn without penalty to pay for medical expenses or to pay insurance premiums, even during periods of unemployment. With Medical Savings Accounts, people would have the money to purchase preventive care and to pay other small medical bills, using health insurance to pay for catastrophic expenses. As a result, patients would acquire greater control over how their health-care dollars are spent, and they would have a strong incentive to be prudent consumers because they would get to keep the money they did not spend. John C. Goodman National Center for Policy Analysis Dallas SINGLE-PAYER SYSTEM As this table shows, over the past decade medicine has become increasingly bureaucratic. Many managers work toward keeping costs down through utilization reviews, mandated second opinions, and the like. Yet this has driven the administrative costs of the U. S. health care system well over $175 billion per year and undermines the morale of physicians and the satisfaction of patients. A tax-financed single-payer system with a global budget can eliminate many layers of bureaucracy and provide proven cost control mechanisms. President Clinton can begin the process of converting the system in steps. We could begin by covering children and pregnant women with a tax-financed health insurance, then expand the program to the uninsured, and finally include the entire country. Ezekiel J. Emanuel Oncologist and Ethicist Harvard Medical School Employment in Health Care Per 1,000 employees Physicians Managers Ratio 1983 519 91 5.7 : 1 1985 492 106 4.6 : 1 1987 514 154 3.3 : 1 1989 548 188 2.9 : 1 1991 575 199 2.9 : 1 % increase from 1983 to 1991 10.8% 118.7% Source: The Bureau of Labor Statistics DRUGS For many diseases, pharmaceuticals are the most cost-effective therapy, obviating the need for expensive, invasive treatments. And the most effective treatments for now intractable diseases -- AIDS, Alzheimer's, cancer -- may well be discovered by the pharmaceutical industry, which has done so much to treat polio, tuberculosis and certain forms of heart disease. Unfortunately, a lack of third-party coverage acts as a disincentive to the use of pharmaceuticals. Only 5% of hospital costs and 19% of physicians' costs are paid out of patients' own pockets, in contrast to 55% of prescription drug costs. Lack of coverage has led to the perception that drug prices are too high. In fact, U. S. spending on pharmaceuticals has remained under 1% of gross national product since 1965, even as total health care spending has burgeoned from 6% to around 14% of GNP. Health-care reform should focus on providing assistance to those who must spend a disproportionate amount of their incomes on prescription drugs (primarily the elderly and people with chronic diseases). The Clinton goal should be a system that equalizes incentives between pharmaceuticals and other services. William C. Steere Jr. Chairman and CEO, Pfizer Inc. New York MEDICARE IS EMBLEMATIC The federal government's current approach to medical cost containment succeeds only in limiting health-care professionals and driving up medical costs. Medicare is a prime example. Our 35-bed community hospital had to write off $3.4 million last year for Medicare patients alone. Translated, our doctors didn't always discharge patients when Medicare told us to; we ordered tests and qr0700,0015treatments that Medicare didn't approve; we took care of complications that the rigid world of Medicare did not allow for. Our motive? Certainly not profit! How about good patient care? Private practitioners are in the same boat. We must freeze charges to Medicare patients while our overhead continues to skyrocket as we deal with expanding federal regulations, most of which thwart good patient care. The solution? Let's streamline and minimize government involvement. Let the government and physicians work as allies, not enemies. Provide incentives, not threats. Emphasize prevention, not crisis medicine. Reward primary care, where prevention begins, over expensive procedures. Decentralize. Grant more autonomy to the states. Stop legislating medical judgment. Martha G. Stearn, M. D. Internist Jackson, Wyo. COMMUNITY CARE NETWORKS To encourage cost containment, keep quality high, and get health coverage to 36 million Americans who lack it, government must encourage collaboration among hospitals, physicians and others in networks at the local level. Community care networks should provide a package of essential health services at a set annual fee per person. The incentive: keep people well. National health care reform will succeed if its solutions can be tailored to fit community needs. Dick Davidson President, American Hospital Association Chicago END COST-SHIFTING The need for health care is painfully evident in the distortion of prices. Costshifting has occurred to such an extent that the price of medical care bears little, if any, relationship to its actual cost. The effect is felt mostly by employers. Although health care prices may increase by only 8% to 10% nationally, costs for employer-sponsored health insurance are increasing at twice or more that rate. Health-care reform must re-establish and preserve competitive markets. If, instead, reform is viewed as an opportunity to shift more costs to employers, the cost of labor will increase, jobs will be lost, businesses will close, and this country will become less competitive -- not more competitive -- in world markets. Anthony J. Gajda William M. Mercer Inc. New York A TIGHT, FIXED BUDGET Americans have long believed that health care should have a special moral status and thus be allowed to follow its own, unfettered economic rules. That is wrong. Health is only one of many important human needs. Nothing, then, is more important for the future than a public and professional acceptance of a tight and fixed annual health-care budget. Other countries have done it. It works. Daniel Callahan Director, the Hastings Center Briarcliff Manor, N. Y. EXPENSIVE MANAGED CARE From the runways of health-care fashion, managed competition is emerging as the star of the show. Proponents say the potential to save money is tremendous. But that notion has arisen out of ideology and political expediency. While paying lip service to market economics, managed competition creates a bureaucratic quagmire to constrain health care costs. Managed care, as it is now practiced, is not the solution to soaring health care costs; it's part of the problem. I joined several managed care plans to oblige longstanding patients whose employers stopped offering indemnity insurance. My managed care patients now generate about 70% of my office revenue. The need to get prior approval for consultations, procedures and X-rays has generated a massive amount of paper work in my office and has required me to hire two extra employees. Prior to the initiation of managed care I spent 40% of my gross income on overhead. Today 64% of my gross income goes for administration. Since 1985 -- the advent of managed cared here at Sequoia Hospital -- the institution has added 35 employees to "manage care." They provide not one iota of care to patients. We must move beyond case-by-case micromanagement and substitute standards of care and the measurement of doctors' overall performance against scientific standards. Unfortunately, the transformation of American medicine along these lines will take years to accomplish and we may spend more money than we save. President Clinton, if you are going to plunge this nation into a system of managed competition be prepared to open the government's purse. Sidney Marchasin, M. D. Board Member, Sequoia Hospital Redwood City, SOCIAL PATHOLOGIES Massive poverty, coupled with certain kinds of behavior, results in an increased volume and severity of illness in this country: more drug abuse-related illnesses, more AIDS, more teenage, unwanted, out-of-wedlock pregnancies resulting in premature and sick babies, more homicides and assaultive injuries, and more accidents demanding intensive and expensive medical services. These cultural factors -- linked with social pathologies like the breakdown of the family, chronic unemployment, homelessness and violence -- cause Americans to end up in the emergency rooms, intensive care units and morgues of our urban and rural hospitals. This country is paying dearly for its social problems once they become medical problems. Health insurance reform is vital, but any attempt at an economic "quick fix" such as global budgeting will only deprive the most vulnerable among us of adequate care. Unless President Clinton perceives the health-care dilemma as associated more with our social problems than with the structure of the health-care system, he is unlikely to fulfill his promise to control costs and extend care to all Americans. Leroy L. Schwartz, M. D Health Policy International Princeton, N. J. CHILDREN FIRST No city better illustrates the need for change in American health care than Los Angeles. Only a few months ago a surgeon at Cedars Sinai Hospital transplanted a liver from a baboon in a desperate effort to save a woman dying of complete liver failure. This in a city where two out of three Hispanic preschoolers have not been immunized. Doctors are pushing the envelope of high-tech medicine in the shadow of neighborhoods where thousands of pregnant women do not get basic care. The Clinton administration should propose a basic package of services including vaccinations, well-baby care, nutrition counseling and hospital services to every child and pregnant woman in America. This can be done by adding a 1% children's health tax on all medical, hospital and insurance-premium bills, excluding Medicaid and charity care. But providing financial access is not enough. Children need a good primary-care provider to make sure that they actually get the care they require. A KidCare program in which every doctor, nurse, social worker and health professional in America is required to act as the health advocate for one poor child under the age of two as a condition of licensure would solve this problem. Arthur Caplan Center for Biomedical Ethics University of Minnesota LET THEM CHOOSE To deal with America's many health-care problems, Hillary Clinton's team must try to end the link between an individual's place of work and the health-care services he has access to. The employment-based system means a change -- or loss -- of benefits with each job change. It leads to uninsurance among workers without company plans. And the illusion that "the company pays" fans inflation. The Clinton administration can solve these problems by letting the rest of us in the program that all federal officials enjoy. The Federal Employee Health Benefits Program lets employees choose among 10 to 20 competing plans, and provides them with government assistance equal to a fixed percentage of the premium cost. FEHBP premiums have risen over the last decade at only two-thirds the rate of corporate-plan premiums. And federal workers can keep the same plan from employer to employer, and even into retirement. The Heritage Foundation's tax reform plan converts today's tax exclusion for company-sponsored plans into a refundable tax credit, which effectively would make an improved version of the federal program available to all Americans, including the uninsured. Stuart Butler Heritage Foundation Washington [This article is made available here by Dow Jones Co. for the personal and non-commercial use of callers to this bbs, in the hope that it will be of some help to those who are suffering from the disease and others who are seeking to help them.]