The Means, Part 5: Healthcare

The Means, Part 5: Healthcare

by Bobby Dillon

So I’m reading a book. It’s called An American Sickness: How Healthcare Became Big Business and How You Can Take it Back by former physician and current New York Times columnist Elisabeth Rosenthal. Elisabeth Rosenthal has done some great work on healthcare. For years now, she has been doing some in-depth reporting and editorial work discussing just what a broken mess our healthcare system is. Under our current system, patients are awash in surprise billing, rising out of pocket expenses, and provider networks that can change from month to month. In An American Sickness, Rosenthal one of the stories she tells is of a family whose father had a heart attack. They drove him to the hospital where he was declared dead in the waiting room, before even a single test had been done. The family got a bill for $21,000 because the hospital “strategically billed” the family just for checking in.

See, as Rosenthal illuminates in her book, there are a million little pieces all working in tandem to create the single most expensive and ineffective medical system in the developed world. The system is so sprawling and shoddy that I couldn’t do justice to its awfulness in the space of this single column. Instead, let’s focus on insurance. . 

Health insurance is a good thing in theory. The idea behind insurance is that we collectively all pay in and create a pool of money from which we can draw when someone needs medical care. It’s a genuinely good thing to have such a pool of money, something to which everyone contributes and from which everyone can draw. Now, a problem with our current system is that the executives who oversee these large pools of money are taking a FAT chunk out of that pool and dividing it up amongst their rich buddies. The insurance company (and therefore the executives who make decisions on behalf of the insurance company) have a VESTED INTEREST in making sure they pay out as little money as possible for your care. The Affordable Care Act (“Obamacare”) made it so that insurance companies HAVE to pay out at least eighty percent of the money they take in. It is in their interest, as people who want to make as much money as possible, to get to that eighty percent without going over even if it means twenty cents out of every dollar just disappears into the ether. 

Then, the hospitals engage in their “strategic billing” and charge whatever they want for the services they provide. And, usually, what they charge is not commensurate with the service itself, which is why it costs twenty bucks for an Advil. The hospitals, even though they may technically be “not-for-profit,” are still operating to the direct financial benefit of the individuals who run the place, and to them it’s no matter what obscene prices they charge because they’ll get their money anyway. Insurance will pay them or you will. And guess who pays the insurance companies. 

So, the hospitals charge outrageous prices for even the most simple medical interventions. Why do they do this? Because they know the insurance companies will pay it. Why do the insurance companies pay such exorbitant prices? Well, because they’re legally obligated to pay out eighty percent of the money they take in. How they get to the eighty percent really doesn’t matter to them. You know why? Because they can just decide not to pay any time they want. I’m sure that everyone reading this has gotten a surprise bill from the hospital for something they thought would be covered. I have. I paid it, too, because just paying the damn bill is a million times easier than trying to argue with the insurance company about it. The insurance company can just decide that they’re done paying your doctor bills and what are you going to do about it? What recourse do you actually have? Unless you can afford a small army of lawyers to fight this battle for you, you’re screwed. 

Now, consider the fact that every hospital in the country needs things like medications, and knee braces, and gloves, and needles, and all kinds of shit like that. Where do you think they get that stuff? From some company who is charging the hospital a lot more than what it actually costs to make the stuff. This is one way the hospital justifies charging obscene amounts of money for even simple procedures. The cost of supplies and equipment is so high because those companies KNOW the hospital will pay it. Why does the hospital pay it? Because they know they can turn around and charge whatever-the-fuck for your hip replacement, knowing full well the insurance company is going to pay for it.

Do you see how these things feed into each other? This is why Medicare-for-All is essential. The organizing principle behind M4A is creating a “single payer” healthcare system. Now, what does that mean? 

Right now we have a system with a theoretically infinite amount of “payers.” Blue Cross is one payer, United Healthcare is another, et cetera, et cetera. Each of these companies is broken up into a billion smaller regional payers and these are the entities we trust to “pay” for our healthcare. All of which is to say that, really, we’re the payers because the insurance company gets that money from somewhere. Each one of these entities negotiates their own rates with each hospital in their network. 

Medicare works like this: the government is the ”single payer” instead, so when it comes time to negotiate reimbursement rates for a colonoscopy, the hospitals are negotiating with The People.  

Now, I understand people’s worries and skepticism when it comes to creating a government-run program. Our government sucks. But here’s what a good government would do: 

The government, ostensibly, represents the will of The People. A government, unlike the CEO and Board of Trustees of the local hospital network, is elected. As an entity, the government is the political and legal embodiment of The People’s will, and as such wields a great deal of clout. When you negotiate with the government, you’re negotiating with literally everyone in the country. The government then, wielding the clout that comes from representing the People, can decide how much it wants to pay for a knee replacement.

Right now we pay more for healthcare per capita than any other industrialized nation and what do we get for it? We get the highest infant mortality rates in the developed world. We get obesity and chronic health problems and preventable deaths on a scale that outshines our global peers. We spend so much on healthcare and get so little in return. Medicare For All would be a major step in the right direction, but ultimately is just a step. In my view, the goal is to remove profit from healthcare entirely because the things a person needs shouldn’t be subject to the capitalism tax. 

Stay tuned.

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