Obama’s troubles with healthcare

August 18, 2009

morici– Peter Morici is a professor at the Smith School of Business, University of Maryland School, and the former Chief Economist at the U.S. International Trade Commission. The views expressed are his own. –

Healthcare reform is in trouble, because President Obama and congressional leaders are not adequately addressing issues that trouble many Americans.

House of Representatives Speaker Nancy Pelosi and Health and Human Services Secretary Kathleen Sebelius caution Americans to ignore terrorist claims about death panels. Reasonable enough—unseemly critics on both the right and the left seek to stir up unwarranted hysteria.

Sebelius defends end of life counseling from physicians as a benefit families need when facing difficult treatment choices for elderly relatives. However, what worries people is such counseling in the context of government rationing.

All health insurers ration care—private insurers in the United States and government-run health services in Canada and Europe face tough choices and limited resources. U.S private insurers generally don’t deny or delay critical care that could cause death—officials implementing such a policy would land in jail.

Foreign public systems are noted for long waits for specialists and critical procedures like hip replacements and bypass surgery. In Sweden, for example, delays result in suffering and deaths that would not occur in the expensive, but more humane, U.S. system. No one is held accountable, the elderly are particularly vulnerable, and that is euthanasia, de facto if not de jure.

President Obama promises Americans they won’t lose private health insurance if they want to keep it. However, legislation moving through the House requires businesses to pay an 8 percent payroll tax if they don’t provide healthcare and creates a government-run alternative to private insurance. Moderate senators would like to create non-profit cooperatives instead but to gain support from liberals in Congress, those non-profits would operate much like government agencies.

It won’t be long before businesses that pay employees an average of $50,000, or even $75,000, annually figure out it would be cheaper and easier to pay the tax than continue providing private insurance. Many people who work in small businesses would be forced by employers to purchase insurance from a government or non-profit agency. Most Americans don’t want to rely on the Post Office or the United Way for their healthcare.

Healthcare costs at least 50 percent more in the United States than in Canada and Western Europe. Important factors include expensive malpractice suits, inefficient insurance company bureaucracies, poor staffing practices and dangerously low standards at many hospitals, and doctor fees and drug prices much higher than abroad.

Early on President Obama gave the tort lawyers a pass, and is busy cutting deals with drug companies and other healthcare businesses that won’t appreciably bring down U.S. costs. That is why his healthcare reform will require $1 trillion in new taxes.

The president promises to soak the rich to raise that cash, but he proposes to tax them for all his other initiatives too. Unless he wants all wealthy Americans to move to Switzerland, that is simply impossible.

Americans are losing patience. They want healthcare fixed but the president is not delivering what they want.

19 comments

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We need tax policies that preserve America’s global competitiveness, and we need to oppose policies that reduce businesses’ ability to grow. Make the tax system simple and fair. A successful economy encourages investment and rewards achievement. It would be the height of economic folly to target any group for a major tax increase. http://www.friendsoftheuschamber.com/tak eaction/index.cfm?ID=42

Posted by mld | Report as abusive

Come on you lost people. Move to Canada for the best health-care you will ever get. Yes, it is a form of socialism, but, at least, we openly admit it. There’s no doubt that Obama is a closet socialist.

Posted by sid | Report as abusive

Companies should not be responsible to pay health care. It is making US Companies uncompetitive.

Insurance companies have been raising premiums by 20% a year in New York for private holders. THey need to to make “juicy profits.” THat is why we are over paying for health insurance.

We are the laughing stock of the developed world and no one wants to copy our crummy unfair health policies where the rich pay nothing for health care insurance because they are covered by their employers. Shame.

Posted by semsem | Report as abusive

Working in health care, I do notice the uninsured in CA get better health care when they walk into or ride in by 911 fire dept to an emergency dept. No one is turned away. English speaking or not. Unless a person chooses to not take the tests or tx, everyone coming in sees a triage nurse, ER nurse and Doctor. Most ofter out of fear of litigation, treatment is over the top becoming very expensive. Urgent care for non emergent maladies and free clinics are available. If the person’s insurance contracts with another facility, we pass on the info per the insurance co. that coverage is at another facility, however, if they chose to stay they will get appropriate diagnostics & or treatment regardless of how or when the person can pay. Because many procedures, treatments,lab, ekg, x-ray etc are performed but not paid for, the charges appear enormous (and they are) to cover for the other half that don’t pay or have medi-care that pays less than the base cost of diagnostics, treatments, procedures etc. Someone, some thing will pay. Either the Facility (private or state, county etc hospital) pays by taking the loss or the insurance pays some and or the patient pays the rest or gov funds like medi-cal. Nothing is free. I’m taxed, your taxed by state, county, city, country. These tax dollars is the gov money that pays for the uninsured. Why have a Post Office or DMV type panel triaging my or your medical needs and decide what to pay for it. Medi-care does that now. Judging what I’ve seen as a nurse, its clearly not working as well as could be. Trying harder the wrong way is nonsense.
Kate

Posted by Kate | Report as abusive

“Americans are losing patience. They want healthcare fixed but the president is not delivering what they want.”

Damn right, almost nobody’s delivering what Americans want these days and you could’ve just written something to that effect and been absolutely right. But no…

Early on, the article says:
“unseemly critics on both the right and the left seek to stir up unwarranted hysteria”

It then revs up to incite without citation:
“Foreign public systems are noted for long waits for specialists and critical procedures… No one is held accountable, the elderly are particularly vulnerable, and that is euthanasia, de facto…”

Were this bipolar article any less uncritical of the profoundly unwell U.S. “health”-for-profit industrial conglomerate, its unseemliness would be sickening.

Posted by The Bell | Report as abusive

Obama was wrong when he promised that we could still keep our current health plan if we choose. It’s not up to us, it’s up to our employers. If our employers decide it’s cheaper to pay the payroll tax than hire human resource specialists to navigate the health care maze, many of us will be forced to subscribe to the public plan. The government-run plan will tell doctors how much they can charge, just as Medicare and the Tennessee plans do right now, and our favorite doctors may no longer be available.
http://online.wsj.com/article/SB12504645 7087135327.html

Posted by Greg | Report as abusive

The President has no stakes. The people have stakes. The collective leadership of this country has the responsibility. Poorly suggestive and biassed write -up. Gives the nausea.

Posted by M S W | Report as abusive

How dare you call your healthcare system more humane than in countries with universal coverage? In Canada, we occasionally have to wait for treatment for non-life threatening diseases, but I dispute the idea that more people die waiting for treatment in Canada or Sweden than in the US. And how many people in the US die because they fail to get treatment for their chronic diseases due to the cost? How many people fail to fill their prescriptions? How many people could have been saved if they had seen the doctor promptly rather than trying to save money by seeing if it will “just go away”? While I wait for my treatments in Canada, I can at least be content thinking that those being treated before me are more in need.

Posted by Mya Warren | Report as abusive

“Many people who work in small businesses would be forced by employers to purchase insurance from a government or non-profit agency.”

Examples of non-profit Health Insurance Companies:
Blue Cross/Blue Shield of Minnesota, Michigan, California (and other states)
Kaiser
Medica
Health Partners

I assume there must be many more.

Most of my life I have been insured by a non-profit health insurance company, as have my co-workers.

Posted by John Klug | Report as abusive

Funny, I’m Canadian and I just spent 3 days at the Shouldice hospital up here in Canada. Shouldice is a world class hernia hospital, and it takes in people from all over the world. One of the persons there was a man from Michigan. Apparently, it was half the price to have the operation done at Shouldice, including the 3 day stay afterwards, than to have it done in Michigan.
I have had many medical procedures over the years in Canada, and I have never felt like I have waited too long for any of them. I would never trade my healthcare for that of the U.S.
And we don’t euthanize our elders here as a rule of thumb. In fact, one of the great debates up here is in regards to how much we overspend on the last days of life.
Socialism = a buzzword to hide racism.

Posted by James Perly | Report as abusive

Mr Morici sounds a lot like someone on the payroll of lobbyists. My insurance rates have been rising 20% each year. If my salary went up 20% each year I would be very happy. A public option would allow me to shop around for more economical coverage. Also, what nobody is talking about and what is critical to the new reforms is preventative measures, which would reduce the cost of care because people would be able to get checkups earlier, catching minor issues prior to them becoming major illness.

Posted by Vee Mccann | Report as abusive

August 18th, 2009 11:57 pm GMT – Posted by Vee Mccann

Mr Morici sounds a lot like someone on the payroll of lobbyists. My insurance rates have been rising 20% each year. If my salary went up 20% each year I would be very happy.
*****************************8
Our premium went up 40% this year and we’re living on a pension – gov’t I might add and are insured with the Federal Health Plan – same one the 535 members of Congress use, except they can afford to pay their premiums. Our monthly premium is 24% of our income. Insane – I’m ready to move to Canada.

Posted by Patricia Gould | Report as abusive

What is the source for the statement:

“In Sweden, for example, delays result in suffering and deaths that would not occur in the expensive, but more humane, U.S. system.”

I live in Sweden and I am surprised over that statement.
Swedish citizens live in average 3 years longer than the citizens of United States.

Posted by Leif Stenberg | Report as abusive

ouse of Representatives Speaker Nancy Pelosi and Health and Human Services Secretary Kathleen Sebelius caution Americans to ignore terrorist claims about death panels. Reasonable enough—unseemly critics on both the right and the left seek to stir up unwarranted hysteria.

How dare Pelosi to call us terrorist. By God’s hands she should be removed from office. Americans hysteria is caused by the likes of her and Obama’s lies. I have read the bill. I also lost my husband last year because the VA hospital said there was nothing else they could do. They told him he was going to die. He died, but in misery. It took him 1 1/2 years to die without them helping him at all. They stopped paying for anything. The VA healthcare system (government) killed Larry. STOP SPENDING AND GIVING AWAY THE MONEY.

Obama heath care plan includes Government Funded Abortion on Demand. And even forces insurance companies to pay for ondemand abortions to get government funds.

Since when is ABORTION on demand health care?

Also why not just expand an existing system MEDICAID?

Because this is not about health care it is about GOVERNEMNT control. Please tell your sentors to vote NO to increased gov spending and contel.

Posted by Bob Sanders | Report as abusive

[...] By: Peter Morici,REUTERS BLOG [...]

I’m an average, everyday American. I think the mainstream media spent all of August concentrating on the fringe groups instead of properly informing us about healthcare in other countries with mandated coverage. I would love to hear from anyone to discuss how you manage under such a system. I’m not out to politicize the discussion. I just want to know how it is and how you manage the payments.

I’m very worried, very worried. Due to this recession I’ve been unemployed since mid-2008. Now I’m self-employed. My salary is half of what it was before but I love my job and want to grow my business. However, I’m in the low-income nowhereland: I make too much for Medicaid and Food Stamps but just barely enough to keep up with rent and food and utilities.

Mandated coverage will be accompanied by other increases, I’ve heard, such as a VAT and other tax increases. Even with a subsidy mandated coverage premiums and tax credits won’t help me.

I’m currently working 50-60 hours a week for a survival lifestyle. Where is my chance to pursue the American dream? Time for education, time for lesiure? If I had to get a second job I’d be sick and how’s that going to make me healthy working over 70 hours a week?

I’m trying to educate myself to learn more. Our politicians do not answer, do not listen. I’m turning to the greatest reasource possible: We the People, not only of America but of the World. You’re welcome to contact me. Tell me what it’s like. I’m sure not getting any information from the press.

katiestevens2003@yahoo.com

Posted by katiestevens | Report as abusive

I agree something needs to be done about health care in the United States. I have been a “victim” of health insurance denials, and thus accepting a limited benefit insurance plan. That means I pay most expenses out of pocket. The question I have not heard asked or addressed is why do medical procedures cost so much? The expense starts at the point of service – the provider. If we want the best treatment, how can we expect to have insurance to cover the high dollar costs? Why do hospitals charge five dollars for a Tylenol, or $2K for an MRI? What makes it so expensive to run blood work? Who sets the fees for these things? Who can change that? That’s what I want addressed.

Posted by Denise | Report as abusive

All health care systems in the universe face problems these days, but ours, the American Health Care System, despite its high cost faces one big problem: while the US provides (as some comments on this site shows) the best emergency care in the world, it only does an average job at providing health care in general.
The problem is not on the providers side (they do very well), it is with the payment system, which is based on the following ideology (Capitalist ? Socialist ? Free-Thinking ?): 1) Be wealthy; 2) Don’t get sick.
So Prof Peter Morici, don’t sent us, Americans towards other galaxies (countries, etc), support making America (a great place to be – I chose to live here !) an even better place to be !

Posted by Vera Larina | Report as abusive

Prof Morici is ignoring the real facts that the process is being blocked by every Republican in Washington. Also all the conservative radio hosts are daily condemning anything Obama is trying to do to help the country.

The system won’t be perfect. The businesses should get all employees into the public option. It is cheaper and easier for them to do that. The public option is necessary.

Other factors are changing the system from fee per procedure and emphasis on preventive healthcare.

End of life is an arguing point. The reality is senior face this every day. What to do-go to nursing home and suffer neglect and abuse, stay at home and get worse health,opt for some type of assisted suicide if terminally ill, and all related to finances.

Posted by Joe Morgan | Report as abusive