Comments

Health Affairs encourages readers to engage in discussion via comments on our Web site.

• To RESPOND to a particular article: Click on the link "Submit a response to this article" in the box at the top right-hand corner of the article.
• To READ responses to a particular article: Click on the link "View responses" in the box at the top right-hand corner of the article.

Comments to:

Katherine Baicker and Amitabh Chandra Myths And Misconceptions About U.S. Health Insurance Health Affairs, November/December 2008; 27(6): w533-w543. [Abstract] [Full Text] [PDF] [Reprints & Permissions]

Comments:Submit a response to this article

Comments published:

Comment on Baicker, Chandra paper

Greg Scandlen   ( 12 November 2008 )

Comment on Baicker, Chandra paper

Thomas Cox   ( 12 November 2008 )

Comment on Baicker, Chandra paper

Aaron B. Katz   ( 12 November 2008 )

Comment on Baicker, Chandra paper

Selvoy M. Fillerup, MD, MSPH, FACS   ( 12 November 2008 )

Comment on Baicker, Chandra paper 12 November 2008
Greg Scandlen, Founder Consumers for Health Care Choices at the Heartland Institute Send comment to journal: Re: Comment on Baicker, Chandra paper greg{at}chcchoices.org Greg Scandlen	The authors made a good start on debunking some of the myths surrounding health insurance. They missed one important one, however. That is that health coverage is no longer "insurance" at all, but Third-Party Payment. This is not a trivial distinction. Insurance is typically a two-party contract. Benefits are paid to the insured when a loss is incurred. The insured is well aware of not only the premium paid (the cost of coverage), but the value of the benefit derived from that premium. The creation of Blue Cross in the 1930s began an entirely different approach, known as "service benefits." The health plan paid a provider to deliver a service to the insured. The insured had absolutely no idea how much the service cost or whether the cost of the service justified the premium paid. The insured also had no assurance that the provider was working in his/her best interests rather than on behalf of the health plan. Thus, Third-Party Payment created a system with little accountability or efficiency. It relied on the ignorance of the patient. Its main purpose was to generate a stream of revenue for hospitals during the Depression. It succeeded beyond belief in that purpose, and we have been paying a steep price ever since. One sorely needed innovation in health financing would be a return to indemnity insurance that is completely transparent in all respects.
Comment on Baicker, Chandra paper 12 November 2008
Thomas Cox, Consultant Send comment to journal: Re: Comment on Baicker, Chandra paper nurse.statistician{at}yahoo.com Thomas Cox	Baicker and Chandra missed inefficiently transferring insurance risks, to: providers (capitation, prospective payment, DRGs, and managed care); consumers (deductibles, copayments, exclusions, and Part D's "current vs. future" risk); and communities (coverages limited by geography, income, age, gender, race, or illness status), as our greatest "myth." Our inefficient pseudo-insurance "system" -- no coverage, indemnity insurance, managed care, Medicare/Medicaid; and our ubiquitous “insurance for the sick or stupid,” guaranteed issue plans -- is the real problem. Rebutting mathematical "myths" employed to justify turning health care providers into inefficient insurers, “Professional Caregiver Insurance Risk” (PCIR), is beyond this letter. If Wall Street, Fannie Mae, and Freddie Mac were surprises, you need it, but here's an overview: 1. Start with an incomplete indemnity insurance system. 2. Introduce wildly inefficient "innovations" -- capitation, DRGs, and PPS -- and turn providers into inefficient insurers and less efficient providers. 3. Spend decades wondering why service quality and quantity decrease, costs rise, coverage limitations expand, and more people become uninsured. 4. Stop doing 2 and 3, go back to basics: get risk-sharing right. 5. National health insurance is the most mathematically efficient way to manage well-defined health insurance risks, employing cost sharing across geography, lifetimes, employers, and government. 6. Eliminate or marginalize ineffective and inefficient finance, service delivery, and regulatory systems. 7. Use the money saved in 5 and 6 to support true insurance rather than our ethically compromised finance/care system. 8. Fully separate routine care from insurance -- publicly fund/provide excellent and efficient routine care, diagnostic testing, and prescription drugs that we all need, through large, efficient, providers.
Comment on Baicker, Chandra paper 12 November 2008
Aaron B. Katz, Senior Lecturer University of Washington School of Public Health Send comment to journal: Re: Comment on Baicker, Chandra paper garlyk{at}u.washington.edu Aaron B. Katz	Baicker and Chandra provide an excellent review and analysis of misguided arguments concerning the U.S. heath care system and its reform. I would suggest an amendment to the analysis of their Myth 2. I agree that proponents of major reform, whether single-payer or President-Elect Obama's plan, are wrong to assert that prevention and reduced use of ERs (and I would add care management, electronic records, etc.) will pay for universal coverage, as the system is currently structured. But with a different structure, well, different possibilities exist. What the authors miss is that the main reasons health care in other industrialized countries is more "efficient" -- more people covered and served per dollar spent -- are: (1)they have a "spigot" (usually a government ministry's budgetary authority) to control how much money goes into the system, which then forces prices down, which is how we control spending in education, law enforcement, and fire protection; (2) unified financing systems greatly reduce administrative burden on providers (e.g., medical clinics don't need business offices larger than their clinical staff to deal with hundreds of different insurance products and benefit designs, claims forms, and data reporting requirements); and (3) all residents are insured by virtue of being residents, eliminating the dumping ground for "undesirables" that allows so much of the dysfunction in our system. After a transition period to implement systems to capture saved funds, unified, universal systems like a single payer (Medicare, by the way, is not a single payer; it is a large payer that operates within the much larger mess we call a health care system) can, indeed, reduce future costs enough to "pay for" universal coverage -- we have decades and countries full of supportive evidence. Moreover, although I also agree that such systems may dampen innovation, we could easily do without most of the innovation that our system nurtures today -- innovative strategies to avoid serving and paying for people who need medical care, innovative strategies to get providers and patients to use new gadgets and drugs of marginal to no added value, and innovations that have the net benefit of added revenues for consultants, insurers, and, yes, even researchers.
Comment on Baicker, Chandra paper 12 November 2008
Selvoy M. Fillerup, MD, MSPH, FACS, Member, Board of Directors The Center for Health Care Policy Research and Analysis Send comment to journal: Re: Comment on Baicker, Chandra paper s.fillerup{at}chroniccrisis.com Selvoy M. Fillerup, MD, MSPH, FACS	The mother of all health care myths is that there is such a thing as a “healthy population.” The reality is that there is only a population that happens to be temporarily healthy. Children are not universally healthy (visit your nearest children’s hospital). Middle aged people are not universally healthy (attend a walk for cancer survivors). Every temporarily healthy human needs health insurance. Sooner or later, health status changes. Another common misconception (myth) about health insurance is that it should ONLY serve a risk-mitigation function. To some people in the U.S. the term "health insurance" implies that we are speaking of, and ONLY of, an instrument to mitigate the financial risk associated with illness. In this strict definition health insurance is a means of reducing the financial risk associated with an unlikely event -- illness. The real world however, is different. Americans increasingly expect health insurance to serve also as a cost-redistribution tool and therefore use the term "health insurance" to refer to the function of redistributing the routine costs of health maintenance. Preventive medical services (such as immunizations), and screening services (such as PAP smears, colonoscopy, mammography and PSA tests) all have demonstrated value in improved health. But these services are hardly “unlikely events.” Indeed, it is encouraged that they become routine events. When these routine preventive medical services, services NOT associated with unlikely events, are paid for through a health insurance provider, health insurance is in fact performing its cost-redistribution function. To accommodate having the health insurance industry perform both functions for everyone requires that we change our paradigms about health insurance. First, everyone does need health insurance; no one stays healthy forever. Second, in order for people to receive preventive medical care health insurance must perform certain cost-redistribution functions. This does require redistributions across genders and across ages, but the notion that it requires redistributions from the healthy to the unhealthy is short sighted. Among multiple European and Pacific Rim nations the so called health insurance industry routinely serves both a cost-redistribution function and a risk-mitigation function. Finally, someone must dispel two more myths, 1), and that social insurance is “socialized,” and 2) that social insurance costs more. Social insurance is not socialized. Private health insurance covers at least 30% of the population among a third of industrialized nations and covers a lesser percentage of people in several more nations. Several nations intentionally promote private health insurance industries. They do this for several reasons. One is that the private health insurance industry is quicker to innovate and implement new technologies. Another is that money flows differently through privately funded health insurance plans than it does through government sponsored plans. These private plans are more responsive to patient utilization patterns. Nations with private health insurance industries therefore have high-tech medical infrastructure and no waiting times. Last of all, social health insurance actually costs less than the Americanized health insurance model. The second most expensive health care system in the world is Switzerland. One hundred percent of all health insurance in Switzerland is private. Per capita healthcare costs in this high-tech medical system are 29% lower than in the United States. The most efficient nations have hybrid healthcare systems. In these systems part of the population enrolls in private health insurance and part of the population enrolls in a government sponsored plan. Both Ireland and Australia fit this general model. Per capita healthcare costs in these nations are even lower than in Switzerland. All these countries employ a social health insurance model. Nations that employ the social health insurance model have already dispelled several myths. They recognize that sooner or later everyone needs medical care and therefore everyone needs health insurance. They recognize that for people to receive timely preventive services they must be enrolled in a health insurance plan and health insurance must perform cost-redistribution as well as risk-mitigation functions. They realize that the presence of a private health insurance industry promotes responsiveness to patient utilization patterns and assures that there is sufficient medical infrastructure to avoid waiting times. These nations show that “social health insurance” is not socialized. And finally these industrialized nations have demonstrated that with everyone enrolled in a coverage plan, per capita healthcare costs can be much lower than in the United States.