Oh, Canada

I keep getting email notices for enrollment in so-called “Trump Care,” even though there is no such thing. It is often a rubric to get some meaningless skinny-bundle, the kind courts routinely throw out as violative of the remaining provisions of the Affordable Care Act (ACA - often called “Obamacare”) or just a back door to the ACA itself, where the “Obama” thang is just plain not mentioned. Is this political fuss all about getting rid of private insurance companies?

The notion of private insurance carriers does not always go away when a nation provides universal healthcare. In Germany, for example, it is the private carriers that actually provide uniform policies that have been mandated by the government. In the UK and Canada, you can buy supplemental insurance (in Canada, these supplemental programs are regulated) over the basic coverage. Some upscale doctors offer a “concierge” service with luxury elements under a separate agreement in the UK.

There are complaints about long lines and waiting periods at some governmental healthcare providers, but not everywhere. Even in Canada, it often depends on where you live. Outpatient services might not get the same full coverage in some countries, but generally, these government programs really work. Canadian citizens, for example, are not less healthy than their American counterparts with private insurance. This month, the Annals of Internal Medicine (AIM) took a deeper look into some of the more startling basic administrative cost differentials.

With our complex maze of healthcare insurance companies, hospitals and doctors having to maintain detailed records in accordance with requirements that differ from carrier to carrier, on a pure population-average-per-capita-annual basis, according to the AIM study, the United States spends $2,479 per person for administrative costs, while Canada does it for $551. When I use the label “administrative,” that describes administrative healthcare workers with no direct responsibility for patient care.

While the Canadian number is not quite five times the US administrative number, the overall cost of government-provided medical services is substantially less per capita than in the US. The net result, according to the AIM study, is that administrative costs absorb 17% of the healthcare budget in Canada and double the healthcare budget in the United States — 34% — which “goes to the salaries, marketing budgets and computers of healthcare administrators in hospitals, nursing homes and private practices. It goes to executive pay packages, which, for five major healthcare insurers, reach close to $20 million or more a year. And it goes to the rising profits demanded by shareholders.” Los Angeles Times, January 13^th. Administrative costs continue to grow disproportionately in the US.

While Canada began experimenting with government-provided healthcare at the provincial level just after World War II, the current national system did not move forward until the early 1960s. The same “socialism,” “no choice” and “quality will decline” arguments literally threw the politicians who approved the system out of office… but the universal healthcare became a permanent Canadian reality ever since. Today, Canadians would probably give up hockey before they sacrificed their healthcare system. They can sleep at night. There are no medical bankruptcies and no people who face serious health issues without treatment.

“It’s been decades since Canada transitioned from a U.S.-style system of private healthcare insurance to a government-run single-payer system. Canadians today do not gnash their teeth about co-payments or deductibles. They do not struggle to make sense of hospital bills. And they do not fear losing their healthcare coverage.

“To be sure, wait times for specialist care and some diagnostic imaging are often criticized as too long. But a 2007 study by Canada’s health authority and the U.S. Centers for Disease Control and Prevention found the overall health of Americans and Canadians to be roughly similar….

“Administering the U.S. network of public and private healthcare programs costs $812 billion each year. And in 2018, 27.9 million Americans remained uninsured, mostly because they could not afford to enroll in the programs available to them.

“‘The U.S.-Canada disparity in administration is clearly large and growing,’ the study authors wrote. ‘Discussions of health reform in the United States should consider whether $812 billion devoted annually to health administration is money well spent.’

“The new figures are based on an analysis of public documents filed by U.S. insurance companies, hospitals, nursing homes, home-care and hospice agencies, and physicians’ offices. Researchers from Hunter College, Harvard Medical School and the University of Ottawa compared those with administrative costs across the Canadian healthcare sector, as detailed by the Canadian Institute for Health Information and a trade association that represents Canada’s private insurers.

“Compared with 1999, when the researchers last looked at U.S. and Canadian healthcare spending side by side, the costs of administering healthcare insurance have grown in both countries. But the increase has been much steeper in the United States, where a growing number of public insurance programs have increased their reliance on commercial insurers to manage government programs such as Medicare and Medicaid.” LA Times. If we had government-provided healthcare, we could probably cut at least 2/3 off our average administrative spend. Think of the waste that only benefits bureaucrats, shareholders and executives.

The huge price differentials for the same procedures, common in the United States, are irrelevant in Canada, which tends to level the actual costs required to be provided under a government program. There are no shareholders to placate or overpaid CEOs to be coddled. Sure, doctors make less in Canada, but then their education is often subsidized by the government, so they do not have massive floating student loans that suck away at the income for decades, the lot of US physicians everywhere. Add to all of this the cost control measures over prescriptions in all such government-provided systems, outside of the US, and the savings continue to grow without reducing the quality of care. Oh, and nations that do cost-control such prescriptions do not have to face tsunamis of advertising touting one expensive drug over another.

As the Trump administration, in cahoots with 20 red state attorneys general, battles to destroy what’s left of the ACA, they have absolutely no plan to replace it. Why? Because rich people want more? There is an answer, and maybe it isn’t an instant “Medicare for all” alternative, but we need to address the issue. There is no excuse.

            I’m Peter Dekom, and the United States is the only developed nation on earth without universal healthcare.