Healthcare Reform

By David Williams

You don’t have to be a specialist to see America’s healthcare system is broken.

Symptoms are easy to spot: soaring costs for treatment, swelling insurance premiums and a growing number of people who don’t qualify for coverage.

Healthcare reform legislation recently clogged the arteries of Congress, as politicians tried to come up with a cure that won’t be worse than the disease. Their conflicting diagnoses resulted in a watered-down proposal that is closer to placebo than panacea.

Meanwhile, the medical community struggles with the side-effects of a system that’s becoming more socialized by the day without a corresponding rise in reimbursement from the government.

Everyone has an opinion, and when a debate touches on fundamental rights, arguments reach a fevered pitch. It’s enough to make anyone reach for the aspirin.

A medical history

The world’s oldest universal healthcare system dates back to 1883 Germany, when Otto von Bismarck proposed that all employed people, their dependents and all who had been contributors to society deserve healthcare coverage. More than a century later, the U.S. is still the only industrialized nation that does not have a universal healthcare system.

According to Chad Cotti, an assistant economics professor at the University of Wisconsin Oshkosh, America was much like the rest of the world in 1950, with a very small percentage of people getting their health insurance from employers. That changed in 1954, when the IRS made healthcare benefits tax preferred.

“This created a tremendous incentive to have one’s employer provide health insurance as a benefit of employment and allow the cost to be taken out of pre-tax income,” Cotti said. “By 1960, more than 50 percent of the U.S. population received their health insurance from their employers.”

Today, employer-provided health insurance is the standard in the U.S. However, the system’s flaws were evident from early on.

“You have pockets of people who are not going to get into the ‘pool’: those who are unemployed or self-employed, those who work for smaller businesses and retirees,” Cotti said.

Thus, Medicare and Medicaid were born, the former to cover citizens 65 and older and the latter to cover eligible individuals and families with low incomes and resources. Both operate as a single-payer healthcare system, meaning the entire population is served by a single insurance pool out of which costs are met.

The mixed system of employer-provided healthcare and federally funded programs leaves an estimated 15 percent of the population uninsured, many of whom are young working adults, Cotti said. The great American healthcare debate generally has focused on adapting the current system so that everyone has access, not redesigning the entire system to mimic the fully publicly funded models of the United Kingdom (established in 1948) or Canada (established in 1961).

The passing of the Health Care Reform bill on March 23 should ensure that everyone will have access to affordable health insurance. But if most people can agree, on a philosophical level, that healthcare should be made available to all, differences in opinion arise when deciding who should pick up the bill.

A tough pill to swallow

Despite ranking 37th among the world’s health systems in 2000, the U.S. spends the most on healthcare — 15.2 percent of the nation’s gross domestic product in 2005 — according to the World Health Organization.

“The nature of insurance is going to drive costs up,” Cotti said. “Whenever you subsidize a good, people buy more of it, and it drives up total expenditures.”

Other cost culprits include advances in technology, malpractice insurance and the rate at which the elderly population is expanding — not only because as more baby boomers retire, there are fewer people paying into insurance plans, but also because the last year of life represents approximately 28 percent of all Medicare expenses.

Due to increased life expectancy in the U.S., it is estimated that Medicare, which currently accounts for roughly 15 percent of the federal budget, will become insolvent by 2026, Cotti said.

Donna Altepeter, an academic staff lecturer in UW Oshkosh’s social work department, acknowledges that a truly universal healthcare system would be more expensive, but in any event, everyone has to give up something for the greater good.

“Healthcare is expensive whether it’s wholly accessible or not,” Altepeter said. “The issue is finding the most worthwhile way to do it.”

As director of the UW Oshkosh College of Nursing’s Living Healthy Community Clinic, Leona Whitman ’95 and MPA ’00, comes in contact with many people who fall through the cracks in coverage. Through grants, private donations and support from area healthcare providers, the clinic has served more than 5,000 uninsured residents of Winnebago County.

The number of patients has increased steadily since the clinic opened in 1995, due in no small part to rising unemployment rates. In counties where free clinics aren’t available, Whitman said the uninsured have no choice but to seek treatment at emergency rooms.

“So you pay $2,000 for an ear infection at an E.R., whereas at a clinic it would cost $40,” she said. But Whitman is quick to acknowledge that addressing the issue of accessibility isn’t as simple as handing out insurance cards to everyone.

“We don’t have enough medical providers. We’re not set up to absorb the huge number of uninsured,” she said.

‘Worth a pound of cure’

Perhaps no one has a more direct, day-to-day understanding of what ails the current healthcare system and what reform means to the physician/patient dynamic than healthcare providers.

“Reform is already underway,” said Tim Gengler ’76, vice president and chief nursing officer at Aspirus Wausau Hospital. “Mandates come from the government annually.”

Regulatory reimbursement rates continue to drop while the regulatory requirements to pay have gone up, he said. In Wisconsin, healthcare providers are reimbursed 77 cents per dollar for Medicare patients, Gengler said. It can be even lower elsewhere.

“We have to find new and creative ways to provide quality care at a lower cost,” Gengler said.

Increased transparency, such as allowing consumers to compare the outcomes for different hospitals, and improved communication across the industry to find best practices in patient care are two examples of how to keep costs down, he said.

Paula Hafeman ’78 and MSN ‘89, chief nursing executive at St. Vincent’s Hospital in Green Bay, believes healthcare needs to be more integrated — a change that can occur from inside the industry, partnering with government instead of waiting for new laws.

“If we can improve the communication for patients and share information among providers, we can avoid redundant testing,” Hafeman said. However, regulatory barriers and the very high price of implementing a new medical record system impede the evolution of peer integration.
Both Gengler and Hafeman agree that there is one obvious, long-term solution to high costs: prevention.

“We need to educate people to be proactive,” Hafeman said. “It’s probably going to come down to the employers to motivate people to adopt healthier lifestyles.”

Julie Zuleger ’85, who owns Zenergy BodyWorks and Wellness in Oshkosh and teaches in UW Oshkosh’s human kinetics and health education department, said health education has taken a more holistic approach in recent years, examining six interconnected dimensions of wellness.

The lessons in exercise, good nutrition and stress management that students learn in the gym or classroom foreshadow what insurance companies have begun to promote to their adult customers.

“Some insurance companies are covering massage, exercise classes, yoga classes — anything to help reduce stress and help people find balance in their lives,” Zuleger said.

Additionally, companies have begun offering healthcare incentives, such as offering monetary incentives for nonsmokers, subsidizing Weight Watchers programs and bringing massage therapists to the office to keep employees healthier and group insurance rates leaner.

The road to recovery

Healing the healthcare system is bound to hurt financially: The estimated cost to expand healthcare coverage to everyone in the country is $940 billion over the next 10 years.

With a figure like that, it’s no wonder people have such a strong reaction to the recent healthcare legislation. Facts, however, tend to be few and far between.

“Many times, opinions are based on pieces of information found in the media and from politicians,” said economist Cotti. “If we could step back and be less emotionally attached to the issue, we would be able to identify the benefits and the costs and examine the tradeoffs.”

Jim Simmons, political science department chair at UW Oshkosh, agrees.

“Most voters had no idea what was being considered in the legislation in Congress,” Simmons said. “Frankly, the legislation is not really universal anymore; it simply requires people to have insurance.”

Despite the staggering price tag, the new healthcare reform is not a radical alteration from the status quo, Simmons said. Taxpayers already share the costs of people on Medicare and Medicaid, veterans and people serving in the military.

“The healthcare in Massachusetts, which was proposed by Mitt Romney, a Republican, is very much like what is being proposed by Democrats nationwide,” Simmons said. “But ours is a system that makes it difficult to get through any major social policy, even if you have a supermajority and there’s a national crisis.”

There is a blockage of a major overhaul because Congress is more polarized today than it has been since the 1930s, and Republicans have no incentive to hand President Barack Obama a victory by supporting any version of healthcare reform, Simmons said.

Partisan politics aside, the American people seem to be struggling with what could be seen as a head-versus-heart dilemma.

“Most Americans are functional liberals,” Simmons said. “They want more spending on the environment, the elderly, education and so forth, but they don’t want to pay higher taxes for them.”

No one wants to see a neighbor die from neglect, but few are eager to open their own wallets to ensure that everyone gets the healthcare they need.

Neither Cotti nor Simmons were surprised when Congress passed the compromised Health Care Reform bill; Democrats had too much to lose to let the reform die entirely. Some would say it was a step forward, albeit a small one.

In all likelihood, America one day will join the rest of the developed world in offering all citizens truly universal healthcare. In the meantime, a generous dose of patience and a spoonful of optimism are recommended.

• What did UW Oshkosh alumni have to say about the healthcare debate?
• View the "Pursuit of Healthiness" timeline.