Saturday, March 20, 2010

Health Reform, a Final Thought: Similar Swedish System Warns U.S., Huh Oh! Canada's "for Profit" Insurers create Long Lines and Double Billing.

After doing a search of "my own" blog, I was reminded of these two extremely important stories we should pass along to Republican opponents like Rep. Paul Ryan. From the CBC, the article "Canada Finds out the Hard Way: For-profit clinics double-billing, Create Long Waiting Lines," should open a few eyes. Guess we could have seen this coming:

The federal government has failed to enforce the Canada Health Act's requirements for equal access to hospital care, instead allowing more for-profit medical clinics over the last five years. It investigated 130 for-profit surgical, MRI/CT and "boutique" clinics across Canada that sell access to doctors and health professionals for thousands of dollars per patient per year.

They found evidence to suspect 89 clinics in five provinces may have violated requirements by openly selling medically necessary services and double-billing both patients and governments for services.

"For-profit clinics are also taking specialists, health professionals and operating room nurses out of local public hospitals to serve less urgent patients, often for extra fees," said report author Natalie Mehra, director of the Ontario Health Coalition. "Despite claims about reducing wait times, we found direct evidence that poaching staff out of local hospitals by for-profit clinics worsened shortages in local hospitals, forcing the hospitals to reduce MRI hours."

According to the report:
- Canada spends more on private health care than France, Sweden, Italy or Germany.
- Private health care costs are increasing faster than public health care costs in Canada.
- 3.5 million Canadians are not insured or underinsured for essential medicines.
- expansion of for-profit surgical clinics in New Zealand and Australia dramatically increased wait lists for the same treatments in the public system

Swiss Health Care System, Private, mandated and Second most expensive.
Here are a few other important elements to the Swiss health care plan.

A third of the population purchases voluntary supplemental insurance that covers things like private hospital rooms and dental benefits. The policies differ mainly on deductibles ... $200 for adults. There is no deductible for children under 18. After the deductible you pay coinsurance of 10 percent of covered expenses, up to a maximum $500 ... There is no insurance exchange, but Internet comparison sites are available and forms are standardized to minimize switching costs.

Are the policies expensive? Yes. In 2004, 40 percent of households — or one third of individuals — received subsidies. But the country is still struggling with how to handle individuals who fail to comply with the mandate — mainly the poor and recent immigrants.

What is the biggest criticism of the Swiss system? It hasn’t done well at controlling costs. Switzerland is second only to the United States in the percent of GDP spent on health care. It’s also second to the United States in the rate of health care inflation.

In theory, insurers compete with each other to bring down prices. In fact, it doesn’t work all that well. There is also enough wiggle room in the system that insurers are able to cherry-pick — to attract enrollees who are good risks and get rid of those at higher risk.
As long as insurers have control over the plan design and some control over the premium classifications, they can manipulate the risk pool. For example, if they give good service to the healthy and less adequate service to the less healthy, the less healthy may try to move on to another insurer.

The most important difference is that health insurance in Switzerland is provided by nonprofit insurers — though some are affiliated with for-profit companies that offer supplemental policies along the lines of Medigap in the United States. The basic benefit package is defined by law and is quite generous. Maximum drug prices are regulated.

What is the most important lesson Americans should learn from the Swiss system? You can achieve universal coverage through an individual mandate, coupled with subsidies for people who can’t afford health insurance. But it’s not going to get you cost control unless you enact further measures.

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