For a nation that prides itself on being the world’s wealthiest, most innovative, and most technologically advanced, the US’ healthcare system is nothing less than a disaster and disgrace. Not only are Americans the least healthy among the most developed nations, but the US’ health system also ranks dead last among high-income countries. Despite rising costs and our unshakeable faith in American medical exceptionalism, average life expectancy in the US has remained lower than other OECD nations for many years and has continued to decline for the past three years. On the other hand, countries with universal healthcare coverage find their average life expectancy stable or slowly increasing. The fundamental problem in Washington is that both parties are beholden to the pharmaceutical and private insurance industries. Neither has the courage or will to spurn their corporate donors to do what is sensible, financially feasible and morally correct to improve Americans’ quality of health and well-being.
Our system is horribly broken. If this weren’t so, the single-payer debate would not be as contentious as it is at this moment. Poll after poll shows that the American public favors the expansion of public health coverage. Other incremental proposals, including Medicare and Medicaid buy-in plans, are also widely preferred to the Obamacare mess we are currently stuck with.
It is not difficult to imagine how the dismal state of American medicine could be the result of a system that has completely sold out to free-market ideology and the bottom line interests of drug makers, healthcare mega-corporations, the insurance industry and Wall Street. How advanced and ethically sound can a healthcare system be if tens of millions of people have no access to medical care because it is financially out of their reach?
The United Nations recognizes healthcare as a human right. Last year, former UN Secretary General Ban Ki-moon denounced the American healthcare system as “politically and morally wrong.” Ki-moon belongs to a group known as The Elders founded by Nelson Mandela and funded by Sir Richard Branson and musician Peter Gabriel, a group of older wise statesmen and stateswomen around the world determined to tackle global crises during their remaining years and unafraid to take on the capitalist system. Among their initiatives is global universal healthcare, and the US has been an enormous roadblock to reaching that goal. 
The US’ healthcare system is a public economic failure, benefiting no one except the large and increasingly consolidated insurance firms at the top that ultimately supervise the racket. The entire system is another example of the moral deterioration that fuels the inequality plaguing the nation for the past three decades.
Our political parties have wrestled with single-payer or universal healthcare for decades. Obama ran his first 2008 presidential campaign on a single-payer platform. His campaign health adviser, the late Dr. Quentin Young from the University of Illinois Medical School, was one of the nation’s leading voices calling for universal health coverage since 1986. Among the 35 most developed OECD nations, 32 have some form of universal healthcare systems. However, past efforts to even raise the issue have been rapidly attacked and falsely discredited. The fact of the matter is that a huge army of private interests are determined to keep the public enslaved to private insurers and high medical costs. The failure of our healthcare is in no small measure due it being a fully for-profit operation. Industry and older corporate rank-and-file Democrats and Republicans argue that a single-payer or socialized medical program is unaffordable. However, not only is single-payer affordable, it will in the long-term save over $2 trillion annually. It will end bankruptcies due to unpayable medical debt. In addition, as we outline below, universal healthcare, structured on a preventative model, will reduce disease rates at the outset.
During a private conversation with Dr. Young shortly before his passing in 2016, he conveyed his sense of betrayal at the hands of the Obama administration. Already in his 80s when he joined the Obama team to help lead the young Senator to victory with the promise that America would finally catch up with other nations, he sounded like a defeated man. Dr. Young shared how he was manipulated, and that Obama held no sincere intention to make universal healthcare a part of his administration’s agenda. During the closed-door negotiations that spawned the weak compromised bill known as Obamacare, Dr. Young was neither consulted nor invited to participate. In fact, he stated, he never heard from Obama again after the election. The record shows that the principal parties meeting with the Obama administration were from the insurance and medical industries. It is they who created Obamacare. It was left to the charismatic and charming Obama to offer this up to the public as a spectacular victory.
Today the pharmaceutical, HMO, and insurance industries, as well as medicine’s most prominent professional associations, medical schools and Wall Street firms comprise a powerful cartel with its tentacles wrapped around the throats of politicians and federal health agencies, determined to refashion healthcare in its own rapacious image. Obama’s domestic promises and accomplishments, including Obamacare, were anemic at best. The policies he enacted only further muddied the waters with esoteric taxes, shortsighted giveaways, and bureaucratic hurdles. Meanwhile, the physical and mental health of the nation continues to erode.
Corporate Democrats argue that Obama’s 2010 Affordable Care Act (ACA) was a positive step inching the country towards complete public coverage. However, aside from providing coverage to the poorest of Americans, the ACA turned into another financial anchor around the necks of millions more. Since the law was enacted, the average price for a family health policy has risen by $2,200. Patient out-of-pocket hospitalization costs are also increasing and have now reached $329 billion. The ACA is riddled with loopholes benefiting the private insurers who actually wrote the bill. After Obama left office, 28 million people remained uninsured. Rather than healthcare spending lessening, as Obama promised, it has exploded. Since Trump took his place upon the throne, an additional 7 million Americans fell into medical hardship and joined the uninsured. Over five percent of American children under 18 remain uninsured. These figures are in no way indicative of a “strong economy.”
Clearly, a universal healthcare program would require flipping the script on the entire private insurance industry, which employs approximately half a million people. Yet the private health insurers’ profits continue to surge. For the first three months of 2017, the top five for-profit insurers collected $4.5 billion in net earnings. Yet this seems conservatively low. Last year, Modern Healthcare reported that United Health alone cracked the $200 billion revenue mark in 2017, showing a 30 percent profit increase. And none of this extreme wealth went directly towards preventing disease. It is all a middle-man scam.
Democrats are becoming more sharply divided over the matter of universal healthcare. It will be a critical issue for Democrats looking to enter the White House in 2020, and corporate Democrats beholden to the pharmaceutical and insurance industries will face harsh opposition for reelection. Nancy Pelosi fills much of her campaign war chest with contributions from the healthcare industry, which amounted to $1.18 million last election cycle. According to Kaiser Healthcare News, the top three Democratic House leaders — Nancy Pelosi, Steny Hoyer and James Clyburn – have collected over $2.3 million in campaign contributions from the pharmaceutical industry since the 2008 election. Hoyer in particular receives more PAC financing from drugmakers than any other member of Congress.
Obviously, the most volatile debate concerning a national universal healthcare system concerns cost. Although there is already a socialized medical system in place — every federal legislator, bureaucrat, government employee and veteran benefits from it — fiscal conservatives and groups such as the Koch Brothers network, including the Koch-funded Mercatus Center at George Mason University, are single-mindedly dedicated to preventing the expansion of Medicare and Medicaid.
Government medical coverage already reaches between 38-46 percent of Americans, according to the US Census Bureau. The Mercatus analysis made the outrageous claim that a single-payer system would increase federal health spending by $32 trillion in ten years. However, analyses and reviews by the Congressional Budget Office in the early 1990s concluded that such a system would only increase spending at the start; it would quickly be offset by enormous savings as the years pass.
In one analysis, “the savings in administrative costs [10 percent of health spending] would be more than enough to offset the expense of universal coverage.”
High administrative costs overshadow all aspects of US healthcare, not just the insurance industry. Twenty-five percent of hospital spending is administrative, compared to 16 percent in the UK. In 2015, CNBC reported that $275 billion was wasted in insurance paperwork. In addition, there are billing services, which in 2012 averaged $471 billion to physicians, hospitals, supply services, and private and public insurers.
Therefore, the private insurance industry and private billing services would have to be either removed from the equation altogether or radically reformed in order to comply with federal rules rather than dictating them. The Green Party’s Dr. Margaret Flowers, the national coordinator of Health Over Profit for Everyone, argues that a single payer system is “the best way to put private insurers on the margins of our healthcare system and to control the pharmaceutical industry” as well as their exorbitant drug prices.
Indeed, a universal healthcare system would increase federal spending. But at the same time, independent analyses indicate it would reduce the nation’s total healthcare costs, a critical goal we should be striving for. Compared to other nations, the US spends a disproportionate amount on healthcare. According to the Centers for Medicare and Medicaid Services, in 2017, the US spent approximately $10,740 per person. However, as we will note below, this is a misleading figure. It conceals the deeper problems running through the system. Compare this to Switzerland, the second highest per capita spender at $8,000, or 28 percent less. At present, healthcare accounts for 18% of the US’ GDP, an unsustainable figure as costs increase. After the US and Switzerland, per capita expenditures decrease dramatically, with Germany (the third highest) at $5,700. France, Canada, Belgium, Japan, Australia and the UK each spend less than half what the US does.
An investigative review published by The Atlantic found that more than half of healthcare spending goes to only five percent of patients! If this money were equally distributed, then the $10,740 per capita expenditure for every adult and child might make sense. The writer calls this tiny segment of patients who dominate health costs the “Platinum Patients.” Most of these medical “frequent flyers” are the elderly and the chronically ill who have reached the final months or days of their lives. This is where tens of billions of dollars in care and treatment are spent annually. This segment of patients is also the most lucrative for private insurers, hospitals and doctors – patients whose charts can be larded with unnecessary diagnostic tests, drug prescriptions and medical procedures to further scam the system.
Funding a National Health Program would primarily be accomplished by raising taxes to levels comparable to other developed nations. The Green New Deal proposed by Senator Sanders and the new young Democrat progressives in the House would tax the highest multimillion-dollar earners 60-70 percent. Despite the outrage of its critics, including old rank-and-file Democrats like Nancy Pelosi and Chuck Schumer, this is still far less than in the past. During the Korean War, the top tax rate was 91 percent; it declined to 70 percent in the late 1960s. Throughout most of the 1970s, those in the lowest income bracket were taxed at 14 percent. Life, including healthcare, was affordable then.
But Democratic supporters of the ACA who oppose a universal healthcare plan ignore the additional twenty new taxes that were levied to pay for the program. These included surtaxes on investment income, Medicare taxes from those earning over $200,000, taxes on tanning services, an excise tax on medical equipment, and a 40 percent tax on health coverage for costs over the designated cap that applied to flexible savings and health savings accounts. The entire ACA was messy and unnecessarily complicated from the start. And the people who suffered the most from these hidden details, yet were mandated by law to purchase private insurance, were those that just missed the poverty line cutoff.
Other public health costs are completely out of kilter, presenting a completely avoidable drain on the system. The fact that Obamacare created and strengthened two parallel systems — federal and private — with entirely different economic structures created a labyrinth of red tape, rules, and wasteful bureaucracy. Since the ACA went into effect, over 150 new boards, agencies and programs have had to be established to monitor its 2,700 pages of gibberish. A federal single-payer system would easily eliminate this bureaucracy and waste.
A medical New Deal to establish universal healthcare coverage is a decisive step in the correct direction. The energy behind the younger generation of Democrat legislators is admirable, but we question whether they possess the wisdom to address the fullness of our health crisis. We must look at the crisis holistically and in a systemic way. Simply shuffling private insurance into a federal Medicare-for-all or buy-in program, funded by taxing the wealthiest of citizens, may only reduce costs, possibly only temporarily. It will not curtail nor slash escalating rates of disease. Any effective healthcare reform must also tackle the underlying reasons for Americans’ poor state of health. We must not shy away from examining the social illnesses infecting our entire free-market capitalist culture and its addiction to deregulation. A viable healthcare model must structurally transform how the medical economy operates. Finally, a successful medical New Deal must honestly evaluate the best and most reliable scientific evidence in order to effectively redirect public health spending.
For example, years ago, Dr. Ezekiel Emanuel, a former Obama healthcare adviser, noted that AIDS-HIV measures consume the most public health spending, even though the disease “ranked 75th on the list of diseases by personal health expenditures.”
On the other hand, according to the American Medical Association, a large percentage of the nation’s $3.4 trillion healthcare spending goes towards treating preventable diseases, notably diabetes, common forms of heart disease, and back and neck pain. In 2016, these three conditions were the most costly and accounted for approximately $277 billion in spending.
The rate of autism has increased 15 percent in only a two year period. It now stands at 1 in 28 boys (2.7 percent) and 1 in 152 girls. The CDC estimates that 1 in 40 children between 3 and 17 years of age are autistic. In 2015, the economic burden of autism disorders was $268 billion; it is expected to almost double to $461 billion by 2025. There are no signs that this alarming trend is slowing or stopping; and yet, our entire federal health system has failed to search honestly and conscientiously for the underlying causes of this epidemic.
All explanations that might interfere with the pharmaceutical industry’s unchecked growth, such as over-vaccination, are ignored and viciously discredited without any sound scientific evidence. Therefore, a proper medical New Deal will require an overhaul and reform of our federal health agencies, especially the Centers for Disease Control, a thoroughly compromised and corrupt agency that cries out for demolition and rebuilding. For any medical revolution to succeed in advancing universal healthcare, the plan must prioritize spending in a manner that serves public health and not private interests.
It will also require placing all private corporate interests and their lobbyists on the sidelines, away from any strategic planning, in order to avoid gross conflicts of interest. This would be the correct approach; however, we have little faith that our legislators, including the so-called progressives, are willing to undertake such actions.
Most important, America’s healthcare system, as well as the Green New Deal, almost completely ignores the single most critical initiative to reduce costs – that is, preventative efforts and programs instead of deregulation and loopholes designed to protect the drug and insurance industries’ bottom line. Prevention can begin with banning toxic chemicals that are proven health hazards associated with current disease epidemics.
This should be a no-brainer for any legislator who cares for public health. Unfortunately, unlike Europe, the US continues to permit numerous toxic chemicals, including many known carcinogens, to find their way into common everyday products. Stacy Malkan, co-founder of the Campaign for Safe Cosmetics, notes that “the policy approach in the US and Europe is dramatically different” when it comes to chemical allowances in cosmetic products. Whereas the EU has banned 1328 toxic substances from the cosmetic industry alone, the US has banned only 11. The US continues to allow carcinogenic formaldehyde, petroleum, many parabens (an estrogen mimicker and endocrine hormone destroyer), the highly allergenic p-phenylenediamine or PBD, triclosan, which has been associated with the rise in antibiotic resistant bacteria, avobenzone, and many others to be used in cosmetics, sunscreens, shampoo and hair dyes.
Other toxic chemicals are commonly used in the American food industry. Potassium bromate and azodicarbonamide (ADA) are frequently found in baked foods, yet both are banned in Europe due to cancer risks. Attempts to ban potassium bromate from breads and buns, pastry dough, and pizzas started twenty years ago, yet the fast food industry continues to use it extensively. The International Agency for Research on Cancer has labeled the chemical a likely human carcinogen. Likewise, the FDA continues to argue that azodicarbonamide, or ADA, a whitening agent used in flour, is safe, although animal studies have also revealed carcinogenic activity. Other health-threatening chemicals used in raising farm animals, such as genetically engineered bovine growth hormone and ractopamine (used to increase metabolic weight gain in cows, pigs and turkeys), are also prohibited in the EU but not the US.
These are only a few among hundreds of chemicals and food additives that the FDA lists as safe but the EU has banned. One reason Europeans are so much healthier than Americans is because their governments take more immediate measures and step in once a chemical is shown to pose serious health risks. This is one preventative measure the US must adopt in order to reduce avoidable healthcare costs. Corporations should no longer be given a free pass to poison our population. There are no safe levels for any carcinogenic and hormone-disrupting chemical, and that applies across the board – for every healthy and sickly man, woman and child.
Next, the food Americans consume must be evaluated for its health benefits. We see no problem in taxing the unhealthiest foods, such as commercial junk food, sodas and candy, products that contain ingredients proven to be toxic, and meat products laden with dangerous chemicals including growth hormones and antibiotics. The scientific evidence that the average American diet is contributing to rising disease trends is indisputable. We would also implement additional taxes on the public advertising of these demonstrably unhealthy products. All such tax revenue would accrue to a national universal health program to offset medical expenditures associated with the very illnesses linked to these products. Although such a tax measure would help pay for a medical New Deal, it should be combined with programs to educate the public about healthy nutrition if it is to produce a reduction in the most common preventable diseases. The public must understand the reasons why their favorite junk foods are being taxed and the health risks they face by consuming them.
Measures to improve the quality of Americans’ health demand a harsh reality check. After acknowledging that $3.4 trillion is being spent on American healthcare every year, we must look at how it is being spent. It is highly unlikely, if not impossible, that our suggestions will be taken seriously. Ultimately, the best solution is to remove the extravagant profit motive from the system, eliminate the private insurance and billing industries completely, and invest in a national preventative health program. Preventative health education should be mandatory throughout public school systems.
Physicians are also forced into a bind, and this is contributing to prodigious waste in money and resources. In 2010, $55.6 billion (2.4%) of annual healthcare spending went towards medical liability insurance. It is time that physician liability insurance is replaced with no-fault options. Today’s doctors are spending an inordinate amount of money to protect themselves. Legions of liability and trial lawyers seek big paydays for themselves stemming from physician error. Forbes reports that the cost of medical malpractice runs at about $55 billion per year. This has created a culture of fear among doctors and hospitals, resulting in the overly cautious practice of defensive medicine, driving up costs and insurance premiums just to avoid lawsuits. Doctors are forced to order unnecessary tests and prescribe more medications and medical procedures just to cover their backsides. In 2017, $200 billion was spent on unnecessary medical tests, compared to $6.8 billion just 6 years earlier. The blowback has been a tragic rise in medical errors, patient injuries and deaths.
According to a 2017 review by Dr. Raj Gopalan, vice president of Innovation and Clinical Informatics at Wolters Kluwer, there are at least two million confirmed adverse drug reactions in the US every year, causing 100,000 deaths. These medication errors and complications add an additional $136 billion to the US’s annual healthcare bill. Furthermore, there is the loss of work and productivity due to medical error. The Journal of Health Care Finance estimates that every year, 10 million work days valued at approximately $1.2 billion are lost due to measurable medical errors. The reality is likely much worse, and an earlier analysis by Loyola University Medical School estimated that the total economic impact across the board for all losses due to iatrogenic events and deaths is nearly $1 trillion every year.
No-fault insurance is a common-sense scheme that enables physicians to pursue their profession in a manner that will reduce iatrogenic injuries and costs. Individual cases requiring additional medical intervention and loss of income would still be compensated. This would generate huge savings. In recent years, reports have indicated that the US is experiencing a shortage of doctors, with too many med school graduates entering highly specialized and lucrative medical professions in order to increase their income. We believe that all medical and nursing education should be free. From the time students graduate, they should receive an excellent living wage, even before proceeding to any specialty – all without the specter of debt looming over their future.
No other nation suffers from the scourge of excessive drug prices like the US. After many years of haggling to lower prices and increase access to generic drugs, no substantial progress has been made. And now even generic drug prices are skyrocketing, according to a CBS News investigation. A 60 Minutes feature about the Affordable Care Act reported a “orgy of lobbying and backroom deals in which just about everyone with a stake in the $3-trillion-a-year health industry came out ahead—except the taxpayers.”
For example, Life Extension magazine reported that an antiviral cream (acyclovir), which had lost its patent protection, “was being sold to pharmacies for 7,500% over the active ingredient cost. The active ingredient (acyclovir) costs only 8 pennies, yet pharmacies are paying a generic maker $600 for this drug and selling it to consumers for around $700.” The active ingredient in the drug tretinoin costs 80 cents to manufacture, yet a full bottle costs $1,100. Other examples include the antibiotic Doxycycline. The price per pill averages 7 cents to $3.36 but has a 5,300 percent mark up when it reaches the consumer. The antidepressant Clomipramine is marked up 3,780 percent, and the anti-hypertensive drug Captopril’s mark-up is 2,850 percent. And these are generic drugs! These numbers show how bloated and rapacious the medical industrial complex is. Drug prices like these are another reason why do not have universal healthcare.
Medication costs, therefore, need to be dramatically cut to allow drug manufacturers a reasonable but not obscene profit margin. By capping profits approximately 100 percent above all costs, we would save our system hundreds of billions of dollars. Such a measure would also extirpate the growing scourge of pricing fraud, which forces patients to pay out-of-pocket in order to make up for the costs insurers are unwilling to pay.
The same is true for exorbitant hospital costs. A one dollar bag of intravenous saline can cost up to $546, plus an additional $127 to administer it. A single aspirin pill can cost $30, six times the pharmacy’s cost for a full bottle, if given in the ER. A Fox News report noted that a visit to the ER for a headache might bankrupt you with over a $17,700 bill, or bilk you with a $24,100 bill for a sprained ankle. Unfortunately, the private insurance industry permits this unchecked price-gouging, and hospitals simply take advantage of the medical services racket.
The chart below summarizes estimated costs that may be saved by converting to a national universal healthcare program. If a truly concerted effort were made to overhaul our system, savings could reach over $2.6 trillion. This figure does not even include the billions in savings that could be achieved if drug price increases were regulated. The current figures pertain to reviews and reports available between 2012-2017.
Regardless of its critics, a single-payer program is completely feasible and well within the nation’s reach. Dean Baker at the Center for Economics and Policy Research states,
“The government already pays for more than half of the nation’s health care bill through Medicare, Medicaid, veterans’ benefits and other public sector programs. Getting to Medicare for All would mean covering the other half of current expenses, along with the additional costs of paying for the uninsured and under-insured who are not getting the care they need.”
Finally, we must acknowledge that our healthcare is fundamentally a despotic rationing system based upon high insurance costs vis-a-vis a toss of the dice to determine where a person sits on the economic ladder. For the past three decades it has contributed to inequality. The economic metrics used cast millions of Americans out of coverage because private insurance costs are beyond their means.
Uwe Reinhardt, a Princeton University political economist, has called our system “brutal” because it “rations [people] out of the system.” He defined rationing as “withholding something from someone that is beneficial.” Discriminatory healthcare rationing now affects over 35 million people who have been priced out the system and left uninsured. They make too much to qualify for Medicare under Obamacare, yet earn far too little to afford private insurance costs and premiums. Out-of-pocket expenses for services insurers refuse to provide can also bankrupt a family. In the final analysis, the entire system is discriminatory and predatory.
We have to be realistic. Almost every member of Congress has benefited from the flow of Big Pharma money into their pockets for their campaigns. The only way to begin to bring our healthcare program up to the level we see in other developed nations’ programs is to remove the drug industry’s rampant and unnecessary profiteering from the equation.
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Richard Gale is the Executive Producer of the Progressive Radio Network and a former Senior Research Analyst in the biotechnology and genomic industries.
Dr. Gary Null is the host of the nation’s longest running public radio program on alternative and nutritional health and a multi-award-winning documentary film director, including Poverty Inc and Deadly Deception.