Why We Still Resist Universal Healthcare - Who Cares and How Much

 

“Without adequate health care, no one can make full use of his or her talents and opportunities. It is thus just as important that economic, racial and social barriers not stand in the way of good health care as it is to eliminate those barriers to a good education and a good job.” Republican President Richard Nixon, 1974

After World War II, most of the developed world was recovering from the ravages of that global conflict. Decimated cities, some blasted from the earth, scorched farmland, millions of refugees driven from their homes (those that survived), hordes of returning soldiers and sailors from all sides looking for jobs and homes. Canada, then more firmly a part of the Britain, may have been relatively unscathed, but its linkage with the United Kingdom pulled its resources into the UK’s recovery cost. Having recovered from the relatively minor damage inflicted entirely on its territories (Hawaii and Alaska were not yet states), the United States maintained itself exceptionally well. Its farmland, factories and cities were unscathed and fully operational. Why is this remotely relevant in examining American resistance to universal healthcare? Let’s see.

The United States emerged as the only superpower nation on earth. The Soviet Union was struggling, having been hit the hardest among the allies, China was still a most backward monolith closed off from the rest of the world, Europe was in tatters… but the United States was humming. Our GI benefits, from education to housing, were fueling a post-War recovery. And while there were momentary downturns as the nation absorbed its returning soldiers, we had so much excess manufacturing capacity (remember all the New Deal hydroelectric construction) that we needed little more than domestic demand to re-prime our economic pump.

Unions prospered. Their fringe benefit packages, with sumptuous healthcare elements, set the tone in the world of expected employment benefits for most. Wages began to rise. Higher education generated legions of well-paid executives and professionals. Productivity was high. Housing construction exploded. We even amped up our advertising sector, soon pushed skyward by the expansion of television, to create a new generation of lifestyle-driven consumers. Automobile sales soared. Roads improved. Infrastructure was a priority. The US dollar was king, and American earning power was matched and amplified by rapidly rising availability of consumer goods… at rising prices. Way above what the rest of the world could afford. 

Between the US Marshall plan and the willingness of decimated nations to invest their own capital, at the expense of consumer goods, to rebuild their war-torn cities and infrastructure, these programs defined the late, 1940s, 1950s and even the 1960s. Without government support, trillions in today’s dollars, the rest of the world would not have recovered for decades more. 

So there arose a dichotomy: the wealthy United States with a humming economy and exceptionally well-paid workers, especially a new cadre of “how to get rich” executives, professionals (especially doctors) and bankers  and   the rest of the economically struggling world relying on governmental largesse to recover from the war. Canada and the UK began to experiment with universal healthcare after the war, but by the 1960s, that concept rapidly became imbedded in both the popular psyche and governmental programs. For many, it was the only affordable answer to healthcare at all. Today, every other developed country, and many developing countries, in the world has installed universal healthcare as an individual right. Except the United States. Why not us?

Professionals, rising pharmaceutical powerhouses, the explosive power of insurance companies combined with a greater consumer ability to pay, pay, pay … some with generous union or corporate healthcare benefits… all combined to create massive and very well-funded special interests (with very well-organized lobbying) focused on preserving their healthcare golden goose. Government programs in other countries were heavily focused on controlling costs. As the rest of the world still maintained a reasonable cost of living, the United States was hitting cost and earnings levels on steroids. Did we simply push the cost of a universal healthcare beyond the range of affordability? We have always had issues with healthcare for all.

According to the Richard M Nixon Foundation Website, “On February 6, 1974, President Nixon presented his Comprehensive Health Insurance Plan, or CHIP, to Congress in an effort to outline and define his intentions for a health care reform program that would go into effect in 1976. At the beginning of his report, he explains that overall healthcare costs have risen over 20% since 1971, and that the standing average cost of a day-long hospital stay is over $110. On top of the rising cost of healthcare, over 25 million Americans were still uninsured in 1974. 40% of Americans who were insured were not covered for visits to a physician’s office on an outpatient basis, and very few private health care policies covered preventative services. Furthermore, less than half of Americans under the age of 65 and almost none of Americans over the age of 65 had major medical health coverage.” Congress shot that effort down very quickly as those special interests deployed a full and intensively lobbying effort to kill that proposal.

Years later (2010), as the Obama Administration managed to get its Affordable Healthcare Act passed after some serious watering down and special provisions granted to the pharmaceutical and insurance sectors. Soon litigation and congressional budgeting action, plus a very hostile reception in GOP-controlled states, cut back (but did not repeal) that law. With the Biden Administration is now attempting to rewrite a post-pandemic United States, part of that effort is taking the form of a $3.5 billion social infrastructure add-on to the currently pending bi-partisan hard infrastructure plan. Part of that $3.5 billion budgetary reconciliation effort (which short-circuits the Senate filibuster rule) is directed at expanding existing medical benefits, including adding dental, vision and hearing benefits under Medicare.

David Lazarus, writing for the September 7th Los Angeles Times, explains the massive private sector backlash against this expansion effort: “The $4-trillion U.S. healthcare system is so vast and so complex, any discussion of changing things can (and will) get quickly bogged down in hard-to-address policy details…. Nearly all medical associations oppose ‘Medicare for all’ or using Medicare rates as a baseline for payments. The reason: They wouldn’t make as much money.

“A recent study by the Kaiser Family Foundation concluded that U.S. healthcare providers would pocket about 40% less in reimbursement for medical services if they received Medicare rates as opposed to the currently much higher payments from private insurers… Employer contributions to employee premiums would decrease by about $194 billion, Kaiser found. Workers and their dependents would spend at least $116 billion less for healthcare. About $42 billion would be saved in the individual insurance market.

“These lower figures don’t mean healthcare providers would suddenly go broke… What they mean is that medical providers would finally have to live in the real world, rather than a magical realm that allows them to enrich themselves, sometimes to an obscene degree, off the misfortune of others… ‘There is no doubt that physicians are accustomed to their current payment rates from both public and private insurers, just as other workers in the healthcare system are also accustomed to their incomes,’ said Thomas Rice, a professor of health policy and management at UCLA… ‘Medicare reimbursement rates for physicians are sufficiently high now,’ said UCLA’s Rice. ‘We know this because relatively few doctors refuse to participate in Medicare.’

“That’s an important point. Whatever shortcomings medical providers may see in Medicare payments relative to higher private-insurance rates, the government program, with nearly 63 million beneficiaries, delivers the patient volumes needed for steady, sustainable business… Also, most healthcare experts acknowledge that Medicare’s more realistic rates would spur doctors and hospitals to operate more efficiently, creating further savings for patients… ‘High reimbursement from private insurers currently reduces incentives for hospitals to operate efficiently,’ the Kaiser Family Foundation concluded.” 

As the costs of medical and dental school skyrocket with very little in the way of financial aid beside exorbitant levels of student borrowings, we seem to be embedding “unaffordability” into the system to justify the highest medical costs (by at least double) in the developed world… and to explain away our most basic need for universal healthcare. It is time for cost containment and expansion of governmental healthcare alternatives until we too can join the rest of the developed world to provide universal healthcare to all Americans.

I’m Peter Dekom, and if there is one logical outcome to this horrible pandemic, it is that the time for universal healthcare in the United States is now, no matter how hard special interests may press against that inevitable outcome.