Saturday, March 11, 2017
By Ned Hickson/Siuslaw News
While watching coverage of the debate over healthcare in our nation’s capitol, I couldn’t help but be struck by the irony of knowing that the same people haggling over what health coverage Americans should have access to are the same people who have complete coverage paid for by taxpayer dollars.
It’s no wonder that the real question that members of Congress should be asking has yet to be raised: Why is healthcare so expensive to begin with?
At $3 trillion a year, the cost of healthcare in the U.S. is nearly twice as much as any other developed country. In fact, according to Consumer Reports, if that $3 trillion healthcare sector was its own country, it would be the fifth-largest economy in the world.
And even though we are outspending other industrialized countries nearly 2-to-1, the World Health Organization (WHO) recently ranked the U.S. a dismal 37th in healthcare systems — with The Commonwealth Fund naming us dead last among the top 11 industrialized countries for overall healthcare dollar-for-dollar.
In preparing this editorial, I spent time researching the reasons behind healthcare’s astronomical costs in this country. While there are many factors, from defensive medicine practices for avoiding lawsuits, to the “branding” of healthcare providers similar to designer clothing (the bigger the name, the more money they can demand from insurance companies), the same two cost factors rise to the top of the list:
WHO studies, Consumer Reports and even health economists like David Cutler at Harvard University agree that those two factors are the driving forces behind skyrocketing healthcare costs.
On average, 25 percent of healthcare dollars go to cover administrative fees. In an interview on the PBS News Hour, Cutler gave the example of Duke University Hospital, which has 1,300 billing clerks and only 900 beds.
Billing specialists are needed to determine how to bill the varying requirements of multiple insurers.
Why the need for multiple insurers?
Because more and more, single insurers can’t cover the rising costs of medical procedures and drug prescriptions, particularly at a time when the median age in America is 40.
In most countries, government negotiates drug prices with drug makers, which virtually guarantees lower prices. However, when Congress created Medicare Part D, it specifically denied Medicare the right to negotiate drug prices. At the same time, the Veterans Administration and Medicaid aren’t under the same restriction and pay the lowest drug prices.
According to Congress’s own Budget Office, if Medicare Part D recipients received the same discount as Medicaid recipients, the federal government would save $116 billion over the next 10 years.
Imagine the money American taxpayers would save if those on Medicare could benefit from the same Medicaid-negotiated drug prices?
One has to wonder why Congress is so opposed to weighing in on controlling the cost of prescription drugs and healthcare as a whole, and what — if any — role those who benefit most from that $3 trillion industry play in that decision.
As taxpayers, we are America’s shareholders — and Congress is our board of directors. It’s time we ask why the board of America, Inc., isn’t pursuing a more cost-effective healthcare plan that will guarantee a better return on our investment, which in this case literally puts lives at stake physically and financially.
Rather than bickering over ways to pay for the astronomical costs associated with healthcare and prescription drugs, Congress needs to slow down and address the issue of controlling those costs in the first place.
Establishing affordable healthcare isn’t about how to pay more but about how to pay less.
Ned Hickson is an author, syndicated columnist with News Media Corporation and editor-in-chief at Siuslaw News. Write to him at nedhickson @icloud.com or at Siuslaw News, P.O. Box 10, Florence, Ore. 97439.