Health Care Is Broken, But How Do You Fix It?
As the march toward health care reform takes place nationally, the debate over what form it should take is heating up on the local level, as well. Many California doctors believe the best plan to cover the uninsured is laid out in a bill slowly gathering momentum in the California State Senate: a government-financed health system backers call “Medicare for all.”
Strong support for the bill is coming from the state’s heavily Jewish contingent of health care providers, who argue that a publicly funded plan covering all state residents would be the most practical and equitable way to fix the state’s health care woes. But with California facing a $21.3 billion budget shortfall and partisan polarization high, health care reform could be a hard slog into a tense summer.
Nevertheless, a single-payer health system — in which care is funded by public dollars through a single state agency but delivered by private clinics and hospitals — has been gaining attention in California in recent years, as lawmakers seek to cover the state’s 7 million uninsured citizens. The plan would be paid for by state and federal funds as well as taxpayer contributions, based on a percentage of income, which would replace today’s out-of-pocket premiums, co-pays and deductibles.
A similar bill passed both houses of the California legislature in 2006 and 2008, but twice was vetoed by the governor. The plan garnered support from the California Nurses Association, the California Physicians Alliance, Los Angeles Free Clinic and more than 100 other state and local organizations saying the system would be the most efficient way to cover all California citizens. Now, supporters are hoping the plan has a better shot.
More physicians are throwing their weight behind publicly funded health care as the economy idles and a growing number of state residents are left jobless. The ranks of California’s uninsured, already ballooning as premiums soar, have also swelled as insurers turn away sick or at-risk people and employers scale back benefits.
Since President Barack Obama announced plans to overhaul the costly U.S. health industry, the national buzz for universal health care has been growing. On May 11, Obama applauded a pledge from insurance providers to cut $2 trillion in costs over 10 years, and House Democrats are now drafting a plan that would require all Americans — including the 47 million now uninsured — to carry health insurance. But while the Obama administration’s plan calls for a publicly funded insurance option to compete alongside private insurers, the single-payer scenario has been largely absent from the debate.
Yet many physicians on the ground now believe a publicly financed universal plan is needed more than ever before, as the cost of running their practices skyrockets and patients can’t afford to pay for care. Critics of the idea, however, fear such radical reform could lead to harmful government regulation, changing the face of a profession already in flux.
With concerns mounting over the future of health care in America, doctors are debating the merits of a plan that could cure what some consider a terminally ill industry — and revolutionize medicine in California.
Lower Costs, Improved Care
For many, supporting single-payer is both a moral and practical issue.
“Access to health care should be available to everybody,” said Dr. Jerome Helman, 68, a retired general practitioner and gastroenterologist. “We’ve reached a point where it’s so expensive that no one can afford care.”
Helman is a member of the California Physicians Alliance (CaPA), the state chapter of Physicians for a National Health Program (PNHP), a nonprofit group of 16,000 health professionals who support a single-payer national health plan. Many local members say they back the system because eligibility for coverage would be based on residency, not income or risk to the insurer.
“I wouldn’t want to be one of those people who goes to UCLA and my insurance company says, ‘Well, he’s so many years old, we’re not going to cover him,’” said Dr. Melvin Kirschner, 82, a retired family practitioner in Granada Hills.
Kirschner and others believe physicians would benefit from a single-payer plan. They say the amount of time they spend on paperwork would be slashed, because they would only have to bill one public agency instead of multiple private insurance companies.
“It would simplify administrative issues and get the burden off of primary care doctors,” Helman said, adding that the time and resources freed up could be directed once again to the most important aspect of the job — the patients.
Jewish tradition supports any health plan that covers the needy while staying financially responsible, said Rabbi Elliot Dorff, rector at American Jewish University (AJU) and noted voice in Jewish medical ethics in the Conservative movement. Although Judaism does not require government aid, he said, several areas of Jewish text call on the community to intervene when individuals can’t afford to care for themselves.
“We may not stand idly by — we have the responsibility to come to the aid of those who cannot afford care,” Dorff said. Fiscal efficiency should be a hallmark of any plan supported by Jewish tradition, he added. “Different types of healthcare distribution can be Jewishly acceptable, as long as they do the job.”
Under SB 810, the single-payer bill now in the California State Senate, administrative costs would fall from about 25 percent of every dollar spent on health care to about 4 percent, policymakers say.
Doctors would see more patients, many say, because millions more people would be covered who previously couldn’t afford to seek care. That would also alleviate strain on the region’s emergency rooms, currently a safety net to the scores of uninsured who rely on them because doctors are obligated to treat patients regardless of their ability to pay.
“If you have to go to an emergency room, it’s a madhouse. Doctors there have a very high burnout rate,” Helman said. “Single-payer would rectify that overnight.”
Consumers under the plan would retain the freedom to choose their physicians, whose practices would stay privately run. Any physician who didn’t want to participate in the system, however, could opt out, according to the bill. Doctors could choose to take private fees only and have patients pay out-of-pocket.
But for doctors that already take Medicare patients, transitioning to single-payer wouldn’t be much of a jolt, supporters say. “If doctors are used to taking Medicare, it would just be like Medicare extended to everybody,” Kirschner said.
Too Much Government Control?
One crucial issue, even for some supporters, is that it isn’t clear how much doctors would be paid for the services they provide. Some fear they would make less money under a single-payer system, making it more difficult to offset the costs of a medical education and operating expenses, like rent and support personnel.
“Doctors are entitled to a nice income because it costs them several hundred thousand dollars to get through medical school, and they spend a good part of their lives going through school,” Kirschner said.
If government reimbursements pay less than current rates under the private system, many say, physicians would have less incentive to provide expensive care to patients. That could dull the pioneering itch among younger generations of doctors and slow innovation.
“I am in favor of universal coverage, but I’m not in favor of trying to control reimbursement,” said Dr. Michael Kotzen, 34, a podiatrist with offices in Van Nuys and Los Angeles. “I just want to make sure doctors have incentive to keep doing what we’re doing.”
These are serious concerns: Reimbursements from other government-run health programs are often lacking, according to a November 2008 poll of U.S. doctors by the Boston-based Physicians’ Foundation. Sixty-five percent of almost 12,000 doctors surveyed said Medicaid reimbursement does not fully cover the cost of providing care, and 36 percent said the same of Medicare. More than 33 percent of physicians surveyed have closed their practices to Medicaid patients, and 12 percent have closed their practices to Medicare patients.
Backers of SB 810 say doctors would be paid commensurate with what they get now. The bill mandates “actuarily sound” reimbursement and guarantees no loss in compensation in the first year, according to a policy advisor. It also grants doctors the power to collectively negotiate for higher payment with a state board that oversees reimbursement — a move currently barred by federal antitrust laws.
Physicians on the high end of the profit scale would likely make less money under a single-payer system, but supporters say the drop in revenue would be balanced by lower administrative costs.
Still, recent reports that Medicare could run out of money years sooner than expected have done little to boost confidence in an entirely government-run health system.
Medicare’s unfunded liabilities — hovering at $34 trillion over a 75-year span — are evidence health care should not be placed in government hands, said Dr. Keith Richman, a former California Assemblyman and executive vice president of health care provider Lakeside Systems. If the entire state population were on a Medicare-like system, he said, the program would go broke or have to sacrifice quality of care to remain solvent.
“Medicare is already a bankrupt system,” Richman said. “We need to reduce administrative costs, but we can do it through the private system” via improved information technology systems and other measures, he said.
A health plan offering public and private options, like that pushed by Obama, would come with its own set of drawbacks, some said. Young, healthy people capable of getting low rates with private insurers would have little incentive to switch to public insurance and help finance the system, said John Glass, of Studio City, a longtime single-payer advocate and member of Health Care for All-California. Insurers, meanwhile, have also opposed instating a public option, claiming it would drive them out of business.
Another concern is that doctors providing care to both publicly and privately insured patients could face a conflict of interest that would “inevitably lead to inferior care for those people taken care of by the government,” according to Dr. Joel Satzman, 73, a retired orthopedic surgeon. But health insurance shouldn’t be administered by a single, “monolithic” public entity that would dictate payment rates either, he said.
“If one patient is going to pay me $50 and another is going to pay me $100 for the same amount of work, I don’t want to be confronted with that decision — but I also don’t want to be told I have to do it for $50,” Satzman said. “I would like to have my opportunity to function in the free enterprise system like everyone else.”
A Medical “War Zone”
Although opinions on reform vary, most agree on one thing: The current system no longer serves physicians and is in desperate need of repair.
“Every year, expenses go up for physicians; every year, reimbursements go down. There are doctors that are going into bankruptcy or going into their retirement [funds] to keep going,” said Helman, the retired general practitioner, who has worked with HMOs and was in private practice for 40 years.
The amount of time and resources physicians spend dealing with multiple health plans has contributed to widespread dissatisfaction with the job, studies show. A recent national study of nearly 900 physicians found that doctors spend, on average, 142 hours each year interacting with insurers — at an estimated annual cost to U.S. practices of $31 billion.
Most physicians spend about three weeks per year interacting with health plans, according to the study, released May 14 in the medical journal Health Affairs. That translates to an average yearly cost of $68,274 per physician, with the greatest burden on primary care doctors, whose costs comprise nearly one-third of their income.
Valuable time is often spent angling for higher reimbursement from insurance companies, some said, which have incrementally cut payments to physicians to stay profitable. As a result, physicians must cram more patients into a typical day to make up the difference.
“There’s a profit motive built into everything. Because of the decrease in fees, the private physician has to be creative to find ways to still make money out of it,” Helman said. “That’s the politics of medicine. It’s a war zone.”
Caught in the middle are the patients, who suffer under swelling premiums, shrinking coverage and lower-quality care.
Health insurance premiums annually rise four times faster than wages, and have grown 87 percent since 2000, according to a 2006 Kaiser Family Foundation survey. In 2007, nearly two-thirds of U.S. adults — about 116 million people — struggled to pay medical bills, went without needed care because of cost, were uninsured for a length of time or were underinsured, according to the 2007 Biennial Health Insurance Survey. The continuing recession has squeezed families even further.
“I have a lot of patients who are uninsured, and a lot of patients who are underinsured. If any of these people have some sort of emergency — they break something or they need a major surgery — the chances are great for financial ruin,” said Kotzen, the podiatrist. “They are basically one injury or accident away from being in poverty due to the bills they’d get for their care.”
It’s clear that doctors across the board see a need for change. How to bring it about is all that remains in question at a time when many feel things can’t get much worse. Helman put it simply: “We’ve reached the point where the system has failed, and there’s no way of going back.”