I used to think January was a boring month, pushing through the snow until the arrival of Valentine’s Day and a much-needed dose of chocolate as a winter anti-depressant. Not so. January proved anything but boring: from the “Scott Heard Around the World” story in the Massachusetts special U.S. Senate election to the visit by the President to the Republican Congressional Retreat in Baltimore on January 29.
February saw both sides re-trenching, and the headlines have focused on the bipartisan healthcare summit hosted by The White House with invitations to Democratic and Republican congressional leadership.
The activity prior to the summit may be telling. The White House released a proposed bill costing roughly $950 billion that is similar to the one passed by the Senate in December, and the pre-summit talking points do not bode well for a collaborative open-ended process to determine how to attack one of our greatest challenges.
While we continue to watch Washington, I am afraid our political leaders are losing sight of a key lesson from Massachusetts: the notion that leaders should never ever underestimate those they lead.
Six months ago, from the viewpoint of a mother, patient and healthcare-industry worker, I wrote A Healthcare Letter to friends and family asking them the following:
Ultimately please don’t think of healthcare reform as a one-time political process happening this fall or not at all. That is the how we can start to change the reform process. Think of it as an evolving transformation in changing the way Americans think about our health, how we manage it, how we improve it and how we finance it. And if we do this right and we are involved, we can achieve successes and breakthroughs along the way.
January’s events have given this country time to pause at least for a moment, so let us use it wisely. Dr. Kent Bottles, writing for the Institute for Clinical Systems Improvement (ISCI), hit the nail on the head in the first line of his recent blog:
The task of healthcare reform in the 21st century is to decrease per-capita cost of care and to increase the quality of care delivered to patients.
He later concludes what most of us feel: Healthcare is incredibly complex. Adding to this is the fact that a majority of Americans don’t understand nor trust what is contained in the 4,000 plus pages of healthcare bills. While some politicians may pivot and try new media tactics or out-reach campaigns, I vote for creating an environment in which many more can engage in the conversation and join together for a common cause just as we did in World War II.
I ask for a simple national New Year’s Resolution: Let us individually better understand the healthcare problem – and opportunities.
If we are to tackle the challenge Dr. Bottles presents, there are key issues that we need to understand if we are to be part of the solution, not just a mob to be manipulated. First, the healthcare problem is our national financial problem. The numbers speak for themselves.
- Average households can’t afford the average cost of care: The average US household income is approximately $50,000 while the US spends $15,000 per household on healthcare, an unbelievable percent of total income.
- While the Government will have paid for more than 50% of healthcare costs in 2009, the current federal mechanism is not successful at controlling costs. In 2008, private health insurance premiums grew by 3.1% while Medicare spending grew by 8.6% and federal Medicaid grew by 8.4%. By 2020, it is projected that one out of every five dollars will be spent on healthcare. In 2009 costs were 17.3% of GDP.
- The bulk of our healthcare costs go to “providers” yet the focus has been on the payment side or insurance business: 62% of healthcare total dollar went to hospitals, physicians and pharmaceuticals while 7% to program administration.
- Our three largest entitlement programs, Medicaid, Medicare and Social Security consume over 40% of our federal budget and are the main drivers of our growing Deficit and Debt: Last year the $7.5 trillion in debt held by the public was 53% of Gross Domestic Product (GDP). In 2020, the current White House budget projects our debt to rise as percent of GDP to 77% to $18.6 trillion.
- Federal spending deficits of more than 3% of GDP are not sustainable in most views: Current budget proposals over the next ten years show our debt rising, as deficits never fall below 3.7%. The 2011 White House Budget proposes a $1.6 trillion deficit or $5,333 per American in 2011.
- The idea that we can keep borrowing from the rest of the world is risky: Currently US Treasuries are considered the most secure financial instruments, but as we approach a 77% debt/GDP ratio that may and will change with potential dire consequences for our financial health.
The second key premise is that with all that money spent and borrowed we get a mixed bag.
- We have the best hospitals and doctors in the world. The Ranking Web of World Hospitals reports 30 out of the 50 Top Hospitals in the World are American. My family has personal experience with three of them.
- We have amazing life saving treatments in the U.S. The five-year cancer survival rate in the U.S. is 63% compared to 55% in Europe for women.
- But while our health has improved in the U.S. as measured by life expectancy, other countries that spend considerably less on healthcare have higher life expectancy. The average life expectancy of Americans is 78.1 or 49th on the world list. Countries such as Japan, Canada, France and Switzerland are higher.
- We have world-class science, technology and healthcare providers, but many Americans still don’t get the right care or care at all: A famous Rand study concluded that Americans receive only 55% of the care that science dictates. Other research shows that on average 50% of the 2 billion prescriptions filled annually are not taken appropriately. It is also estimated that non-compliance to prescriptions generates 10-25% of nursing and hospital admissions.
- What and how we eat may cost us more than we think. Americans get a “bargain” for their food. Or so we think. On average we spend 10% of our disposable income on food. In 1933 it was 25%. Looking across the ocean to Europe, we see a different picture. While Europeans spend less on healthcare, they spend more on food. More interestingly, the disparity increases when we look at food consumed at home. In fact Americans spent only 6.1% on food at home while Germans spent 11% and France close to 14%.
- The great American entrepreneur and the power of the consumer have been held captive in Healthcare. The average price of a new PC last year was only $581. The average cost of care was $7681 per American. One keeps going down; the other keeps going up.
When you look at these issues you see why a traditional political course of making deals and sharing the pie to court votes will not come close to helping us improve our situation. As importantly, making promises to Americans that, if you like what you have, you can keep it and nothing will change, paints a false sense of security and lacks integrity.
While we may hope and wait for our politicians to change, let’s look within. An old notion is that liberty’s very foundation is rooted in knowledge and learning. It might not be too hard to become better informed than those walking the halls of D.C. The experience of last year should underscore to every American that this is our challenge to undertake, and it starts with us understanding not just our own personal situation but that of our country. The oft-neglected concept of the common good remains valid.
In the throes of World War II, a reporter asked Winston Churchill what made him such an extraordinary leader. He replied that these were extraordinary times and extraordinary times make extraordinary people.
Perhaps the real lesson of last year is that America’s savior is not a person but ourselves. We must understand the challenges that face us.
Oakleigh Ryan lives with her family in Janesville, WI with her husband Tobin, and two children. She writes at healthcareletter.com and can be reached at oakleighryan@healthcareletter.com
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