Edson: Why we can’t let big business threaten universal health care

Editor’s note: This op-ed is by Cassandra Edson, a member of the Vermont Workers’ Center’s Health Care is a Human Right campaign. She lives in Montpelier.

Over the last several weeks, big business and fake employer groups came out to kill H.202, Vermont’s universal healthcare bill, with their deadly embrace. Hypocritically asserting their support of health care reform, they have been successfully pressuring senators into weakening the bill, thus possibly inflicting death by a thousand cuts.

These opponents turned against ordinary Vermonters who desperately need universal, publicly financed health care, not just another marketplace where insurance companies restrict our access to care while relentlessly driving up costs.

H.202 proposes a slow transition to universal healthcare via setting up a so-called insurance exchange. This exchange is a marketplace that sells health care as a commodity to those who can afford it, and its establishment is required by federal law. Until a waiver for this requirement can be obtained, the transition to universal healthcare follows the scenario outline in Dr. Hsiao’s report. That report also tells us why an exchange alone, even when coupled with a public option, will neither create universal access nor achieve real cost savings.

An exchange will not significantly increase access to health care for Vermonters. In fact, if we want Vermonters to gain coverage, we need a good number of employers to participate in the exchange. If all businesses employing up to 100 workers would be required to join the exchange, we could get coverage for more people. This could also create a reasonably large risk pool that might start reducing costs. These benefits would be very modest compared with what a universal health care system could achieve.

Yet for reform opponents, even this tiny step is too much: They seek to limit the number of employers participating in the exchange, and are trying to water down the bill sufficiently to achieve this. The fewer employers participate in the exchange, the fewer people will obtain coverage and the more expensive coverage will be for everyone, inside and outside the exchange.

Once in the exchange, an individual’s access to care would depend on whether they can pay considerable premiums, deductibles and co-pays. Moreover, not everyone would get the same benefits — some Vermonters would be more equal than others, based on how much money they have. The only hope for making the exchange slightly more affordable, and slightly more equitable, would be to limit the number of insurance companies and benefit plans in the exchange.

Ideally, everyone in the exchange would get the same plan with the same benefits, so that risks are spread among as many people as possible, thus lowering costs for everyone. This would also enable us to simplify administrative procedures and set us on a path toward a single payment channel for providers – a key cost-saving feature in Hsiao’s report. Health financing experts agree that an increased number of insurers increases costs, as this fragments the risk pool, reduces the leverage each insurer has in negotiating prices with providers, and adds administrative costs.

The calculation is simple: the fewer insurers are involved, the larger the risk pool and the lower the costs. This is yet another reason why health care cannot be treated as a market commodity — competition increases rather than decreases prices. We shouldn’t be surprised that by this, their job is to make money and serve their shareholders. But we cannot let our elected officials let them successfully turn our universal healthcare bill into a tool for a profit-making marketplace that limits access to care and inflates costs for everyone.

Vermonters have demanded — and the administration and Legislature have agreed — that we create a universal, publicly financed health care system that provides medical benefits as a public good for all. Everyone participates — individuals, families and businesses — so that everyone can benefit. Like fire departments and roads, a public good is a service that belongs to us, with costs and benefits shared by all. Those seeking to opt out to pursue their own financial gains, threaten the well-being of all Vermonters. We must not allow them to put profits before people.

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21 Comments on "Edson: Why we can’t let big business threaten universal health care"

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5 years 7 months ago
Ms. Edson, You suggest that we need a publicly-financed healthcare system, “not just another marketplace where insurance companies restrict our access to care while relentlessly driving up costs.” But if the system is publicly-financed, rather than financed by our premiums through insurance companies, then all that means is that the state of Vermont is going to restrict our access to care while relentlessly driving up costs, rather than insurance companies doing so. The cost-savings the state will be able to achieve through administrative efficiencies, coordination of care, etc. will be dwarfed by the fact that there is literally *unlimited* demand… Read more »
Ann Raynolds
5 years 7 months ago

One fact Jamal: Health care insurance NOW is funded through FOR-PROFIT businesses which must pay dividends to stock holders and seems to believe in high administrative salaries (note CEOs are routinely paid multi-million dollar salaries); a health care SYSTEM governed by the public, which is what the single payer concept is, is NOT a business, but rather a funding mechanism for providing health care. WE can own it!

5 years 7 months ago

Ms. Raynolds,

I would sooner put my trust in a for-profit business that is run by highly-paid executives than I would in that same work being done by a Statehouse full of elected representatives, few (if any) of whom have ever run a healthcare insurance business. There’s a VERY good reason that CEOs and other executives are paid huge salaries: those who can successfully run complex, high-stakes businesses are RARE, and therefore command high salaries. If one company doesn’t pay them what they’re worth, then another company will; it’s that simple.

Pam Ladds
5 years 7 months ago
The panic and misinformation engendered by the idea of a single payer system never ceases to amaze me. I am a Brit by birth, lived with a single payer system until I was thirty and worked in health care. Then I came to the USA (31 years ago), continuing to work in health care. I have lived and worked in 3 states (NY, PA and VT). A single payer system allows for competent health care to be available to all, it is not dependent on where someone lives or works, whether or not they have a pre-existing condition, and it… Read more »
5 years 7 months ago

Jamal wrote `and when there is little or no direct cost to people who use those services, costs will absolutely explode` … to which I ask `Substantiated evidence?` (and please – don’t quote opeds)

5 years 7 months ago
Ms. Schneider, About 50 years of healthcare history testify to the factual basis of my statement. The fact that employer-provided healthcare insurance has been tax-deductible for 50 years, along with the advent of Medicare/Medicaid, have increasingly disconnected people from the direct costs of their healthcare consumption. Even the Obama Administration and liberal Democrats in Congress acknowledge that a disconnect between people’s healthcare consumption and the direct costs are a significant factor in raising prices. Witness the huge controversy over the excise tax on “Cadillac” health insurance plans; the reason behind that provision was the explicit acknowledgement that when almost EVERYTHING… Read more »
Doug Hoffer
5 years 7 months ago
all analyses of single payer plans (including the Lewin report years ago) assume increased usage by those effectively shut out of the system (i.e., the uninsured and the under-insured); but that is a relatively short-term effect as folks address outstanding health issues and get into a routine of regular care however, if what Mr. Kheiry said was true, all of the countries with national health systems would have experienced explosive cost increases (that is to say, more than the nasty increases we’ve been living with for years); it should be easy enough to check it out if that had happended,… Read more »
Karl Riemer
5 years 7 months ago
Thank you, Pam Ladds, for injecting a breath of sense and reality into a debate overwhelmed by nonsense and prevarication. There’s a long-standing, tested and proven solution to the problem of access to health care. With many subtle variations, that solution is single-payer insurance. Letting pursuit of profit dictate access to health care has driven us to the deplorable situation we’re in today, in which people suffer horribly, physically, because they don’t have the means to pay for medical attention. Many others make life decisions – employment, marriage, divorce, adoption – based solely on a desperate need for otherwise unobtainable… Read more »
5 years 7 months ago
Mr. Riemer, Your contention that my arguments are false, absurd, nonsensical, and in defiance of reason and evidence are perfectly fine, but you are dead wrong to suggest that I’m trying to say “I’ve got a good thing and no interest in sharing it.” In fact, I have a five-figure deductible, for which I pay an appallingly high monthly premium to maintain. It’s decidedly NOT a good thing. I actually believe market-based solutions and less government regulation will provide better access than the current system, OR a single-payer system. Also, most people agree that one of the bedrock principles of… Read more »
Amelia Silver
5 years 7 months ago

Well said Pam. I couldn’t agree with you more. Have you published this piece, or any other, on the need for health care (not insurance) in a newspaper? You should. Thanks.

walter carpenter
5 years 7 months ago
“There’s a VERY good reason that CEOs and other executives are paid huge salaries.” The CEO of blue cross makes four to five times what the governor of Vermont (no matter who that is) is paid. I happen to know what both salaries are. Other top executives at Blue cross also make more than the governor or any other elected or appointed public official in our state. If you factor in their bonuses and stock options The governor runs a far more complex structure than blue cross or any other health insurance company. While the CEO of blue cross does… Read more »
5 years 7 months ago
Mr. Carpenter, The opinion of one person about what a reasonable or fair salary should be is totally irrelevant. The actual pay and benefits of those offices – Governor, CEO, or whatever – have been set over a period of *decades* through a process involving millions of people, thousands of companies, thousands of government positions, and millions of decisions. The result is a system that pays people exactly what it takes to retain their services. There is no shortage of qualified, competent people wanting to run the VA or run for Governor of any state. Therefore, the pay scales for… Read more »
Doug Hoffer
5 years 7 months ago
Mr. Kheiry I’m a little surprised you would actually say that CEO’s are necessarily paid what they’re worth. We’ve known for years that CEO pay has not been based on long-term performance issues. CEO pay is established by boards of directors whose members are often close to (if not appointed by) the CEO. If nothing else, look at the run-up to the financial crisis. Firms paid CEO’s and other top people enormous sums of money as the companies were being destroyed. And your suggestion that CEO pay schedules have been subject to decisions by millions of people is just laughable.… Read more »
5 years 7 months ago
Mr. Hoffer, I don’t deny that there can be a clubby atmosphere between a company’s officers and its board of directors, but the majority of companies avoid such conflicts of interest because it creates bad publicity and adverse reactions for their stock prices, for which they are all accountable. Why else would you read headlines about CEOs and other company officers being forced out of their positions for performance issues? When it comes to pay of CEOs, governors and others being subject to millions of decisions by millions of people, I stand by that. Whether someone’s skills are worth $15… Read more »
Christian Noll
5 years 7 months ago

I agree with Karl and Walter.

Thanks also to Pam Ladds. What you say is so true.

I second; Ann, Rama and Amelia also.

It appears there are some muckrakers or maybe “Lobbyists” who post here!

Thank you Cassandra for submitting this to vtdigger

5 years 7 months ago
Mr. Noll, Since I’m the only one disagreeing with the columnist and others on this page, I assume you’re referring to me when you refer to muckrakers or “Lobbyists.” You are perfectly free to construe my comments as muckraking, I suppose, but I can assure you I’m not a lobbyist. Nobody pays me for my opinions; they are my own and I share them because I care about Vermont and its future financial viability. It’s interesting that I’ve been accused of being paid to make comments on Vt. Digger. This has happened three or four times already; it seems that… Read more »
Christian Noll
5 years 7 months ago
Thank you Mr. Kheiry, I didn’t notice that you were disagreeing with the columnist, but if it makes you feel any better, I’m probably more of a “Muckraker” in the literal definition of the word than you are. I do think however, we all have a little “Muckraker” in us from time to time. I never said you were a lobbyist either and I’m not so sure “Lobbyists” have to be paid in the traditional sense of the word. Yes it is interesting. I’ll agree with you on that! “Liberals?” Ha! How many “Liberals” do you know who voted for… Read more »
Margaret MacLean
5 years 7 months ago
I was in a drug store recently beside the cash register was a can with a picture of a young woman on it. I put my change in the can. The girl at the register said thanks! Thats Amy she used to work here summers during college but she has a rare kind of cancer and she is no longer on her parents health insurance. She can’t work and she can’t pay the bills we are all so worried about her and her family. Pam as a fellow Brit who grew up with the value that we are one nation… Read more »
5 years 7 months ago

Ms. MacLean,

You are mistaken if you take my opposition to single-payer as opposition to helping others. I believe radical reform is necessary to fix the current healthcare system, which is a hideous hybrid of government and the private sector. I simply believe that single-payer creates more problems than it solves (to say nothing of the system in use in the U.K.). I oppose many government programs, but it’s an unjustified leap of logic to suggest that this means I’m morally bankrupt.

Ron Pulcer
5 years 7 months ago
I would like to avoid the prior ideological and philosophical flame wars, and try to offer a possible pragmatic solution to attracting more companies small, Medium and LARGE to participate in the exchange / GMC risk pool. I work now for a company that has about 350 employees, but not all of them are in Vermont or even New England (but that’s yet another part of the system design that has not been figured out). So my employer is not a small company, but it is not anywhere near a large company like IBM. My current employer in Vermont pays… Read more »
walter carpenter
5 years 7 months ago
“The opinion of one person about what a reasonable or fair salary should be is totally irrelevant.” Why is it totally irrelevant? And I’m sure that I am not the only one with these opinions. “Do you really believe that a board of directors for any for-profit company in the world would agree to pay that amount of money if the SAME skill-set were available for 90 percent less, as your argument implies?” I refer this statement to Doug Hoffer’s answer “CEO pay is established by boards of directors whose members are often close to (if not appointed by) the… Read more »
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