[Grovenet] Chance to be involved in your future -

[Ed Davie]

Where did you find this diatribe, Steven? These 
are not your words!
And, as usual, contain many half truths.
Ed
  ----- Original Message ----- 
  From: Steven
  To: Forest Grove local interests list
  Sent: Saturday, March 03, 2007 9:21 PM
  Subject: Re: [Grovenet] Chance to be involved in 
your future -




  *The "economic" golden era*

  Any health care economist worth his or her salt 
will tell you that from
  an economic standpoint, an ideal health care 
system is one in which
  patients pay directly for their medical care. In 
such a system, patients
  freely choose their own physicians, and together 
with their physicians
  make all medical decisions, mindful that any 
costs incurred thereby are
  theirs to pay. Cost controls are therefore 
automatic. During the 1920s
  and for the next few decades, this “ideal” 
system existed in the United
  States. Inasmuch as doctors at the time had very 
little to offer in
  terms of expensive (or effective) therapies, and 
since patients’
  expectations were (appropriately) low, this 
system worked extremely well
  from an economic point of view.

  *The "medical" golden era*

  This economic equilibrium began to falter in the 
1930s, and the
  disequilibrium rapidly accelerated in the years 
following World War II.
  The first kink in the armor of direct 
contracting between physicians and
  their patients occurred during the Great 
Depression, when hospitals
  began to suffer from patients’ inability to pay 
their bills. Over the
  initial objections of physicians, financially 
stressed hospitals
  prevailed on state legislatures to legalize the 
insurance schemes that
  became known as Blue Cross. In order to assuage 
the moral indignation of
  physicians, however, the Blues were created as 
non-profit,
  provider-oriented insurance organizations.

  “Provider-oriented” meant two things. First, 
Blue Cross (and later, Blue
  Shield) did not try to tell physicians how to 
practice medicine.
  Physicians were free to practice as they saw 
fit, and the Blues would
  simply pay the bills on a fee-for-service basis. 
Second, the boards of
  trustees of local Blue Cross and Blue Shield 
organizations were loaded
  with prominent local physicians and hospital 
administrators.

  Not only did such a system preserve the direct 
physician-patient
  relationship, it also paid the bills more 
reliably than did patients
  themselves. The system worked to so well that 
soon physicians became
  willing to countenance the formation of private 
health insurance
  companies, as long as those companies followed 
the same general
  guidelines set by the Blues.

  Health insurance proved to be so popular that, 
during the wage and price
  controls of World War II, companies began 
offering it to their employees
  in lieu of higher wages. After the war, American 
labor unions began to
  demand that employers provide health insurance 
as a benefit of
  employment. The government liked this idea, too, 
and in order to
  encourage it, tax laws were changed to make the 
provision of this
  benefit extremely attractive to employers.

  *It is important to note that this new tax 
policy created a fundamental
  change in how health care was paid for. In 
effect, it shifted a huge
  chunk of the fiscal burden for health insurance 
from consumers and
  employers to the government, where it remains to 
this day. *Within a few
  years, the majority of American workers had 
employer-provided health
  care insurance, heavily subsidized by the 
federal government.

  Then in the 1960s, the federal government became 
directly involved in
  paying for American health care on a large scale 
with the institution of
  Medicare, and then Medicaid. Since that moment, 
the proportion of health
  care spending directly attributable to the 
government has steadily grown
  – from 24% of all dollars spent on health care 
in the 1960s, to 40% by
  1990. *Today, when you include tax subsidies for 
health insurance, fully
  51% of America’s health care spending is 
accounted for by the
  government, and paid for by taxpayers.*

  Since politicians can tax the people only so 
much, a lot of this
  spending has been piling up in the form of the 
national debt, awaiting
  our children and grandchildren.

  But *for physicians and their patients in the 
second half of the 20^th
  century, the resultant system seemed nearly 
perfect*. While patients
  retained complete freedom of choice regarding 
which doctors and
  hospitals they used, and while the 
physician-patient relationship
  remained largely free of outside influence, 
somebody else was paying the
  bills. There arose an almost complete 
dissociation between providing
  (and consuming) health care, and paying for it.

  *This economic arrangement did at least two 
things that would ultimately
  spell its own doom.** * *First*, it allowed the 
American health care
  myth to flourish – the notion that the best 
possible care should be
  provided to everybody, and that where health 
care is concerned, there
  are no limits. It created expectations that 
ultimately could not be met.

  *Second*, this system fostered the development 
of the medical-industrial
  complex. Since any medical advance that seemed 
useful would be paid for,
  powerful corporations arose dedicated to meeting 
the bottomless demand
  for medical advances. The pharmaceutical 
companies, hospital suppliers,
  and medical device companies began turning out a 
steady stream of
  improved and expensive technology. Ironically 
(given that this whole
  system had evolved largely due to physicians’ 
attempts to shield
  themselves from corporate influence), these 
corporations used their
  considerable marketing clout to influence the 
decisions, the practice
  patterns, and even the demographic distribution 
(such as patterns of
  specialization) of the medical profession.

  The* bottomless expectations of patients and 
physicians,* coupled with
  the never-ending meeting (and flaming) of those 
expectations by
  industry, created a rapidly spinning positive 
feedback loop. The more
  health care the doctors and patients got, the 
more they wanted. The more
  they wanted, the more the medical-industrial 
complex was happy to
  provide. It was inevitable that those paying the 
ever-mounting health
  care costs (i.e., employers and the government) 
would eventually reach
  the breaking point. While the system that 
prevailed during this “golden
  era” came to be regarded as the norm by (if not 
the birthright of)
  American physicians and their patients, from a 
broader perspective that
  system is clearly an unsustainable aberrancy. At 
some point the mounting
  costs of “no limit” health care had to generate 
its own backlash. *
  **The system had to implode.*



  Ron D'Eau Claire wrote:
  > Nothing provides you with more security than 
your closed mind, Steven. You
  > are saved the effort of thinking and caring.
  >
  > You have lots of company.
  >
  > Ron D'Eau Claire
  >
  >
  >
  >
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