MSU PHL 344 - 11-30 (49 pages)

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11-30



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11-30

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Pages:
49
School:
Michigan State University
Course:
Phl 344 - Ethical Issues in Health Care
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Financing Health Care Why is this an ethical concern The United States has the best health care system in the world In short the health care system in the United States is an embarrassing worldclass mess Davidoff and Reinecke editorial Annals of Internal Medicine 1999 Why the difference Is it just a matter of the technological capacity of the health care system for patients who enjoy full access Or is it also a matter of the ethics and fairness of access and the distribution of resources Financing Health Care Economic Political Legal Public policy Ethical Is Health Care Special Is health care a market commodity Like a VCR Is health care a special social good Like basic education Is health care a right Like right to vote and right to a jury trial Health Care as Right Wide variation in how much various people need through life With rapid advances in technology what is basic minimum of care keeps changing Seems more clear and persuasive to see health care as important social good not right Market Commodity Reinhardt Child of a poor US family with a chronic but treatable disease may have much more serious interference of health with basic life chances than richer child with same disease Market Commodity II Is this unfortunate Like a hurricane Is this unfair Like racial profiling Libertarian position Unfortunate but not unfair If poor could simply demand health care they cannot afford they would be stealing goods from others who have worked hard to accumulate them Rich may voluntarily create private charities to help poor Against Libertarianism Are health care knowledge and skills purely the result of one s private labor and effort or has society at large heavily subsidized the training and research process at each step E g estimated that a medical student pays 5 of the total cost of education Leonard Fleck s argument on the basically unfair nature of today s health care system in the U S Fast Food Worker Near minimum wage Pays taxes No health benefits Not eligible for Medicaid Example of working poor who are most of uninsured in US MSU Professor Fairly well paid Receives health insurance as benefit Benefits are not taxed Therefore other taxpayers subsidize health insurance Health Insurer Spends a lot to assure that benefits are not paid to any uncovered members Adds to high administrative cost of US health care enough extra to pay for all care for uninsured Two Myths The uninsured generally wish to be uninsured and do not suffer any ill health We d have plenty of money for all the health care anyone could want if not for waste fraud and abuse Uninsured in U S Less likely to see doctor More likely to delay hospital care Less likely to get preventive care Chances of dying in hospital 24 to 124 greater depending on age and income Question What would it cost to provide the highest possible standard of medical care for every person in the U S Answer Nine times the GDP Savings from Waste Fraud Slope of curve based on new technology aging Eliminate all waste fraud Costs once again rising Another Myth Universal coverage may be an ethically nice idea but it would cost way too much to be economically feasible Conclusions in Two State Commissions If state could adopt a single payer model with universal coverage savings would be enough to pay for the care of all the currently uninsured Michigan Maryland Some Statistics Most People Don t Know Per Capita Spending on Health Care in U S 19701987 Woolhandler Himmelstein NEJM 324 1253 1991 Why Excess Administration Multiple payers great duplication of services Each payer has to hire staff to assure that it does not pay for anyone else s enrollees Typical administrative overhead US private insurance company 15 20 Medicaid Medicare 3 5 A Quiz Canada has national health insurance so essentially everything spent on health care is public US supposedly has a largely free market system but we have some government programs How does per person public spending compare in US and Canada Health Expenditures in Public Funds Only per capita 1994 1600 1500 Dollars 1400 1300 Dollars USA Canada US figures do NOT include tax subsidies for employer paid health insurance Congressional Budget Office 1994 Two health plans then being proposed before Congress led to cost savings in 10 years and after BOTH plans proposed universal coverage None of various other plans saved money None of the other plans proposed universal coverage Same is true internationally Why Not the Marketplace No one has so far proposed a genuinely free market answer to the problem of universal coverage In addition the marketplace solutions that seem most popular today have their own major problems The Insurance Ideal e g Fire Financial protection against lowprobability but catastrophic event Affordable and practical because all who are at risk pay into the pool Most of the cost for those who receive benefits come out of the pockets of those who never suffer the harm Health Insurance Virtually everyone gets some health care sooner or later most get some each year Strong incentives for those at low risk to avoid paying for those at high risk Risk adjustment potentially huge vs smoke alarms Disproportionate Costs Light 5 of population use half of resources 10 of population use 70 of resources Therefore huge competitive advantage to insurer if it can exclude a relatively small subset of patients from coverage Inverse coverage law Light systematic discrimination against neediest people Medically Uninsurable Example You work in a small business with 7 other people Employer provides a group policy One of the other 7 workers develops multiple sclerosis Insurer cancels plan or triples premium You lose Case Study Medicare HMO s Managed care had history of providing good quality care at lower cost More efficient Competition was excessively wasteful Cherry picking selective marketing Therefore could save huge sums by converting Medicare to HMO plans Medicare HMO s cont Created incentives for private insurers to contract to provide HMO care for Medicare beneficiaries Agreed to pay capitation rates of about 90 of current per person Medicare costs assuming this would be stimulus for efficiency Insisted on free choice Medicare HMO s cont Insurers turned out to be very good at marketing plans to the healthiest seniors whose true cost of care was only 6080 of average In free choice system the sickest elderly remained in the non HMO pool essentially having U S taxpayer underwrite the profits of the HMOs Medicare HMO s


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