No graven images may be
Worshipped, except the currency.
Arthur Hugh Clough
The Aztecs are generally regarded today as a bloodthirsty people, in large part because of their practice of human sacrifice. This required that a captured member of an enemy tribe have one’s heart cut out while still alive, which bloody organ was then offered as a propitiatory offering to their Sun God. Today, the practice of human sacrifice has been resurrected in many places around the world, in particular the United States, wherever free trade and free-market principles have come to dominate people’s beliefs, laws, customs, and behaviours.
The inclusion of the word “free” in these economic doctrines has the effect of deluding many of their zealous advocates into believing that their adoption, implementation, and imposition on others increases people’s overall freedom, when, in many cases, the opposite is true. It is Americans’ strong attachment to freedom that explains why, at the present time, theirs is the country that has swung furthest in the ideological direction of free-market economic principles.
In other countries that are wealthy enough to provide health care for all of their citizens, health care is viewed as a right that is made available to everyone, regardless of one’s ability to pay for the services one receives, rather than as an economic product like shoes, cars, computers, and shampoo that is to be bought and sold on the free market. Because of their Puritan origins in the 1600s, many Americans regard laziness, or a lack of industriousness, as a moral sin that ought not to be condoned and encouraged by an overly generous or indulgent state. But if the truth were told, the primary sin in the United States today is not having enough money to participate in their increasingly rigid, conformist, and tyrannical free-market society, where people are judged by the crass, materialistic standard of how much money they earn and how much wealth they possess.
According to the perverse and immoral logic of profit, health-care companies in the United States, as well as those that provide health-care insurance, regard all medical procedures as costs that reduce the company’s profits, and therefore they seek to minimize these costs as much as possible. This means that even those who have medical insurance are sometimes denied necessary treatments, drugs, or operations because the company that insures them decides they are too costly. After all, in the United States, nothing must get in the way of a company’s ability to make profits, since profits are what make the world go round and prevent the evil communists and socialists from taking over the world.
Although the practice of denying people the medical attention they need is much less bloody than the Aztec practice of ripping the heart out of their sacrificial victims, it has the same effect of causing the unfortunate victim’s death. In such cases, these innocent victims are in a very literal sense being sacrificed to the Idol of Profit, which more and more Americans worship as their principle god. Just as the Aztecs mistakenly believed that the Sun had to be appeased with human sacrifices in order to continue shining and thereby provide them with enough food to eat, lest a catastrophe ensue, many Americans believe that the Idol of Profit must not be contraried, limited, angered, or restricted in any way, lest the opulent lifestyles which many of them enjoy suffer a decline.
In case you think I am exaggerating by declaring that Americans have resurrected the barbaric practice of human sacrifice, here is an example of what I am talking about:
Diane was forty-seven years old when a splinter ruined her life.
She had been a teacher at a charter school in California. Because of $8.1 billion in education budget cuts the state enacted in 2009, she lost her job. Without her job, Diane lost her health insurance, so she had to purchase an individual coverage plan and pay the monthly premiums out of pocket. Diane signed up to the best plan she could afford, but that came with a high deductible: typically she would have to pay $5,000 before her insurance company covered any significant medical bills, making her think twice about whether she really had the money to seek medical help.[1]
One afternoon, about a year after she lost her job and signed up for this high-deductible health insurance plan, Diane was walking on the floorboards of her old apartment and got a large splinter in her foot. Because Diane has diabetes, her minor wound became a large gash, then an ulcer that wouldn’t heal.
Diane felt that she couldn’t afford to pay the fee for a doctor’s office visit, nor for prescription antibiotics. So she tried to treat her leg herself—hoping that the redness creeping up her leg would go away if she strictly followed instructions she had found online: hot baths, soap, scrubbing, and over-the-counter antibiotic creams.
After a few weeks, Diane started to feel feverish and sweaty. Then she passed out. Luckily a neighbor heard the shatter of glass when Diane’s head broke the coffee table. The neighbor called 911, and the police broke down Diane’s door and called an ambulance.
That’s when Sanjay [a doctor and one of the book’s authors] met Diane—in the intensive care unit of the local hospital. Her leg was so badly infected it had to be amputated—something that could have been avoided if the infection had been treated earlier. Worse still, the infection had spread to her bloodstream. It was so overwhelming that it was causing her to become septic—causing her blood pressure to drop below 80 over 40. To stop it from dipping any lower and leading to a potentially fatal cardiac arrest, Sanjay inserted a catheter through her jugular vein and into the right side of her heart, so he could pump intravenous fluids into her system and give her medicines that increased her blood pressure. Her kidneys were failing because of the infection, so a dialysis port had to be sewn into her groin. But the dialysis machine created its own problems. Diane suffered a stroke when the dialysis caused a second precipitous drop in her blood pressure.
Diane now lives in a nursing home. At the age of forty-seven, she is unable to speak or walk or move the right side of her body. Like hundreds of uninsured or underinsured patients, she delayed medical care because of fear of the cost. But ironically, her one hospitalization cost over $300,000. Her stroke left her disabled, and she will cost the state of California tens of thousands of dollars a year for the rest of her life. She requires twenty-four-hour nursing care to turn her in bed, clean her when she soils herself, and spoon her food into the left side of her mouth so she won’t choke on it.
Diane’s story is an extreme, tragic example of an everyday occurrence in the United States: the deferral of essential medical care among Americans who simply can’t afford it.[2]
Clearly, in the case of private health-insurance companies, what is good for the companies’ shareholders, namely, a high stock price that usually depends on high profits, is bad for some of the insurance companies’ paying customers. It is precisely for this reason that the profit motive has been eliminated, or its harmful effects mitigated, in almost all countries that can afford to provide health care for all of their citizens. Furthermore, this is a clear refutation of the free-market fanatics’ belief in the universality of the concept of the “invisible hand” – the extremely naive and often erroneous belief that, when individuals pursue only their narrow self-interest, this model of behaviour will always benefit other people.
There exists no other relatively wealthy country in the world where such an unnecessary and entirely preventable tragedy would have occurred. Even in Cuba, a country that is much poorer than the United States, at least measured by narrow monetary standards, a person in Diane’s condition would have received the necessary medical treatment and, instead of becoming an expensive liability to society, she would have continued as a contributing member of that society, by working and paying taxes for the remainder of her working life. It is the bizarre and perverse nature of the American health-care system that has transformed Diane, and many other Americans like her who do not have access to affordable health care, from a tax-paying citizen into a costly dependent, a truly ironic result when one considers that it is precisely Americans’ desire to prevent such costs that has led to this outcome.
Americans’ blind subservience to the so-called free market has meant that many Americans like Diane have imposed on them, as a result of oppressive free-market principles, the “freedom” to die, the “freedom” to suffer needlessly, or the “freedom” to become bankrupt or deeply indebted because they cannot afford to pay for the medical treatment they require. And theirs, so many Americans naively believe, is the best health-care system and the freest country in the world.
One reason why per capita health-care expenditures are higher in the United States than in other countries is because these expenses must also include a healthy profit for the private companies that provide health care – just like oil, automotive, drug, chemical, electronic, computer, and Internet companies – a cost that does not have to be earned in countries where health care is funded by the government. The figure that is usually cited, which is the average per capita amount spent on health care, is misleading because it should really be the average amount spent on each paying – meaning insured – customer, which obviously is higher than the other more cited figure, since there are tens of millions of Americans who have no health-care coverage, and therefore have no ability to consume health-care products except sporadically and inadequately.
Applying the economic model of minimizing costs in order to increase profits in the health-care industry has produced a grotesque, caricatural system that harms many of their country’s citizens. This unfortunate and irrational situation will not change so long as Americans continue to heed the silly propaganda espoused by free-market zealots like Milton Friedman, Ayn Rand, and Alan Greenspan, together with their many political followers like Ronald Reagan, about the virtues of the free market and the many vices and inefficiencies of all government-run programs and regulations.
As the following excerpt by Paul Krugman explains, another reason why health care costs more in the United States is higher administrative costs there than in other countries where governments pay their citizens’ health-care expenses.
Private insurance companies, however, don’t make money by paying for health care. They make money by collecting premiums while not paying for health care, to the extent that they can get away with it. Indeed, in the health insurance industry actual payments for care, such as paying the cost of a major operation, are literally referred to as “medical losses.”
Insurance companies try to hold down those unfortunate medical losses in two principal ways. One is through “risk selection,” otherwise known, rather obscurely, as “underwriting.” Both are euphemistic terms for refusing to sell insurance to people who are likely to need it—or charging them a very high price. When they can, insurers carefully screen applicants for indications that they are likely to need expensive care—family history, nature of employment, and, above all, pre-existing conditions. Any indication that an applicant is more likely than average to have high medical costs, and any chance of affordable insurance goes out the window.
If someone who makes it through the process of risk selection nonetheless needs care, there’s a second line of defense: Insurers look for ways not to pay. They pick through the patient’s medical history to see if they can claim that there was some preexisting condition he or she failed to disclose, invalidating the insurance. More important in most cases, they challenge the claims submitted by doctors and hospitals, trying to find reasons why the treatment offered wasn’t their responsibility.
Insurers don’t do all this because they’re evil people. They do it because the structure of the system leaves them little choice. A nice insurance company, one that didn’t try to screen out costly clients and didn’t look for ways to avoid paying for care, would attract mainly high-risk clients, leaving it stuck with all the expenses other insurers were trying to avoid, and would quickly go out of business. If the people doing all this aren’t evil, however, the consequences are. Remember, there’s an almost universal belief that everyone should have adequate health care, which means having adequate insurance—but the way our system works, millions of people are denied insurance or offered it only at unaffordable prices. At the same time insurance companies spend huge sums screening applicants and fighting over payment. And health care providers, including doctors and hospitals, spend huge sums dealing and fighting with insurance companies to get paid. There’s a whole industry known as “denial management”: Companies that help doctors argue with insurance companies when payment is denied.
None of these costs arise in a universal health care system in which the government acts as insurer. If everyone is entitled to health insurance, there’s no need to screen people to eliminate high-risk clients. If a government agency provides insurance, there’s no need to fight over who pays for a medical procedure: If it’s a covered procedure the government pays. As a result government health insurance programs are much less bureaucratic and spend much less on administration than do private insurers. For example, Medicare spends only about 2 percent of its funds on administration; for private insurers the figure is about 15 percent. McKinsey Global estimates that in 2003 the extra administrative costs of the U.S. health insurance industry, as compared with the costs of the government insurance programs in other countries, ran to $84 billion.
And that literally isn’t the half of it. As the McKinsey report acknowledges, “This total does not include the additional administrative burden of the multipayor structure and insurance products on hospitals and outpatient centers. . . . Nor does it include the extra costs incurred by employers because of the need for robust human resources departments to administer health care benefits.” One widely cited comparison of the U.S. and Canadian systems that tried to estimate these other costs concluded that in the United States total administrative cost—including both the costs of insurers and those of health care providers—accounts for 31 percent of health spending, compared with less than 17 percent in Canada. That would amount to around $300 billion in excess costs, or about a third of the difference between U.S. and Canadian spending.[3]
What is clear is that, in the attempt to switch from a private to a public health-care system in the United States, allowing private health-insurance companies to continue operating creates a massive layer of corporate bureaucracy. In a publicly-funded and operated health-care system, there are three principle groups: the government that pays for all health-care costs and operates and oversees the system, the hospitals, clinics, and individual doctors who provide health-care services, and the citizens who receive the services, and who, through their taxes, help to pay for the costs of this system. By retaining private health-insurance companies, this maintains a wholly superfluous corporate intermediary between customers and both the hospitals that provide health care services and the government that pays for them. And, contrary to what many Americans believe, this unnecessary layer of corporate bureaucracy greatly diminishes, rather than increases, the system’s overall efficiency, while it significantly increases total costs.
The widespread free-market belief that the best way to increase efficiency is to allow people to make a profit is valid in many industries. However, there are industries, such as health care, where this belief is false. The indiscriminate application of economic principles, whether privatization, free trade, unbridled competition, or profit maximization, can cause much harm when those who apply them are rendered blind to the harmful effects of their panacea by their ideological beliefs. Just as we now know that it is not necessary to sacrifice human victims to the Sun in order for it to continue shining on the Earth, Americans and others who worship the Idol of Profit need to realize that it is neither necessary nor morally justifiable to sacrifice human victims to this rapacious numerical idol for the economy to operate efficiently, while providing as many people as possible with the things they need in order to live their lives.
[1] It is obvious what the purpose of these high “deductibles” is: to discourage the paying clients of health insurance companies from seeking medical treatment that could be costly to the company. They are a reprehensible and completely immoral means employed by these companies to reduce their costs and thereby maintain or increase their profits at the expense of their clients.
[2] The Body Economic: Why Austerity Kills: Recessions, Budget Battles, and the Politics of Life and Death by David Stuckler and Sanjay Basu, chapter 6. HarperCollins Ltd, Toronto, 2013.
[3] The Conscience of a Liberal by Paul Krugman, pp. 220-222. W. W. Norton & Company, New York, 2007.
Homo Stupidus 