Our health care system is in crisis. Everyone feels it. Premiums and deductibles keep rising, provider networks are narrowing, and the bite out of the average American paycheck gets bigger and bigger. Health care has taken center stage in the run-up to the 2020 election.
The Democrat arguments swing from elimination of the private health insurance industry and Medicare-For-All to a public option to buy into the Medicare system. The Republicans have no plan, beyond destroying the ACA (Obamacare) and crying “socialism!”
Both Medicare and private health insurance companies are mainly delivery systems. They are end points in supply chains: funnels for goods and services, the prices for which are determined downstream by a variety of complex factors. Each link in the chain represents a profit center for a specific interest: health insurance companies, pharmaceutical and medical device companies; hospitals; and practitioners who treat patients directly.
Because the system is fed with premiums paid by individuals and businesses, there is a finite cash pool from which to draw these profits. The players with the greatest economic and political power are first in line to drink from the trough.
There is a war going on in health care right now: the powerful against the weak. And the weakest in the chain are the providers, and the patients/consumers who fund the system. These individuals lack the economic and political clout to push the system one way or another.
Part One: the assault on providers
As a practitioner for more than 30 years, I have seen managed care (i.e., treatment curated by the insurance companies to assure insurance company profits) squeeze providers into “preferred provider” networks. In exchange for access to patients with health insurance, I must often accept the reduced fees and limited treatment schedules dictated by the insurance companies. At the beginning of this process the arrangement seemed acceptable–fee schedules and payments were reasonable, in line with the care I provided. (If providers decided not to join the networks, they could still see patients, and charge “out of network” rates which were often much higher than in-network fee schedules. But these providers sacrificed referrals from the insurance companies.)
Then came the HMO’s (Health Maintenance Organization). These networks were much more restrictive, and slashed fees severely. In addition, many of these networks were closed—meaning that providers who did not want to accept these low fees lost all access to these insurance patients. Major private health insurance companies-including Cigna, Blue Shield, Aetna, and others–have all signed contracts with one chiropractic HMO. This HMO now reimburses chiropractors at the untenable rate of $27 per office visit. This INCLUDES the patient co-payment: If the patient has a $25.00 co-pay, the doctor receives a check from the insurance company for $2.00! And this is common.
And to add one more insult to injury: This rock-bottom rate has literally not been increased for more than a decade! Doctors thus have little choice but to provide low-level care (as they are compelled to see 8-10 patients per hour), or to drop out of the networks altogether. In either case, both patients and providers lose.
Part Two: the assault on patients
Patients are well aware of what has happened to their health insurance coverage over the last 15 years. The biggest, most consistent shock is that their premiums have risen at a pace way beyond the national rate of inflation. These increases spiked with the passage of the Affordable Care Act. “Obamacare” was great for low-income individuals who now had access to subsidized coverage, but for the middle- and working-classes, and for small employers who had to pay unsubsidized insurance rates, it has been a terrible financial burden.
At the same time, though, the ACA has popularized the notion of universal coverage–and we are now having a national debate about what is the best way to get there. As some Democratic candidates suggest Medicare-For-All and the elimination of private health insurance is one possible solution, the health insurance companies are running scared.
This trend has pressured insurance companies to tamp down the most obvious sign that costs are spiraling out of control: premiums. And this is what they have done. Reports are showing a slowing down of rate increases, and in some cases, actual decreases.1
Superficially, this is news to be celebrated, and a great advertising boon for the insurance companies. What is not said is that to insure company profitability, deductibles are rising–as are co-pays. So even though the obvious benchmark of premiums may be stabilizing, the real costs for patients continue to increase.2 Insurance company and pharma profits rise, assuring healthy returns for stakeholders and company CEO’s.3
This war of the powerful vs. the weak is a stealthy one, as it is played out on the field of public opinion. The corporate interests do not want to appear greedy. At the same time, their push for ever-expanding profits is relentless.
As we enter the 2020 election cycle, it is important that we understand all of the pieces of the health care puzzle. Especially important is the fact that, as in most of our politics, money drives action. Those with the most money get to create the narrative–whether it is true or not. To learn the truth, follow the money.
- https://www.cms.gov/newsroom/fact-sheets/data-2019-individual-health-insurance-market-conditions)
- https://www.latimes.com/politics/la-na-pol-health-insurance-medical-bills-20190502-story.html
- https://www.modernhealthcare.com/insurance/health-insurer-ceos-score-big-paychecks-despite-public-scrutiny
Copyright 2019 Ricky Fishman
Dr. Ricky Fishman has been a San Francisco based chiropractor since 1986. In addition to the treatment of back pain and other musculoskeletal injuries, he works as a consultant in the field of health and wellness with companies dedicated to re-visioning health care for the 21st century.
[email protected] www.rickyfishman.com
