Beyond the status quo
Toolbox
Published: February 23, 2005
Everyone knows Vermont's health care system is dysfunctional, but the status quo exerts a powerful influence in blocking meaningful change. One of the ideas reinforcing the status quo is that, despite its problems, the American health care system is the best in the world.
A new book shows it is a myth that the American system is the best. The book is called "At the Crossroads: The Future of Health Care in Vermont," and it was written by Cornelius Hogan, former secretary of human services in Vermont and presently an international consultant; Dr. Deborah Richter, a physician; and Terry Doran, a journalist. It examines Vermont's health care system and exposes the myths that are blocking reform.
For example, in ranking the survival rates in five nations for several illnesses or procedures, the United States ranked first in only one category, breast cancer. The United States ranked worst for kidney transplants, fourth in colorectal cancer. Canada ranked best for childhood leukemia, kidney transplants and liver transplants.
Meanwhile, the United States has the highest infant mortality among a group of nations that includes Canada, Australia, Italy, Germany, France and Sweden. The United States has the lowest life expectancy among the same nations.
This poor showing occurs despite the fact that the United States spends about double per capita what other industrialized nations spend. The United States spends $5,267 per capita; Canada spends $2,931; Germany, $2,817; and Japan, $2,077. France, which spends $2,736 per capita, has been found to have the best overall system in the world in terms of access, service and affordability.
The authors note that Vermont has a good array of services, ranging from small community hospitals to the large teaching hospitals of Fletcher Allen and Dartmouth-Hitchcock, plus the even more specialized services available nearby in Albany, N.Y., and Boston. The problem in Vermont is not lack of services. It is the crushing cost of administration and the erratic way that costs are paid.
Vermonters pay about $1 billion a year for health care administration. Physicians' offices and hospitals employ droves of workers to track down insurance payments and to handle the bizarre and varying payment plans that may or may not cover various services. Cutting those costs in half would save Vermonters $500 million, an extraordinary number when compared to what the state spends on schools, roads or other services.
Yet this costly system contains few curbs on the growth of expenditures. The state's certificate of need process seeks to prevent excessive spending by hospitals, but it has had mixed results. Past efforts to limit spending by limiting the demand by individual consumers have had minimal effect. There is always going to be a population of people who are sick, have broken legs or are giving birth. It is good for us to reduce obesity, smoking and alcoholism, but that isn't going to change the fact that we have a health infrastructure of hospitals, clinics and personnel that must be maintained for the normal course of health care services.
The work of Hogan, Richter and Doran points in the direction of a system of universal access and public finance to pay for our shared services. Public finance would create public accountability. If the public were paying for health care, the public would have a reason to give close scrutiny to projects that would create excess capacity and expense, such as Fletcher Allen's enormous boondoggle. A health care authority would have the job of helping health care providers match capacity to need. By giving everyone access to the system, health would improve and administrative costs would dramatically decline. If the system were financed with a payroll tax, it would likely take far less out of our paychecks and out of business coffers than the present cost of insurance.
As legislators look beyond the immediate need to eliminate the deficit in the Medicaid system, they will be examining systemwide changes. Some legislators are considering a phased-in system, perhaps first bringing the state's hospitals into a system of public finance.
These are constructive ideas requiring serious thought. Hogan, Richter and Doran have cleared the path for new ways of thinking, and members of the Legislature ought to pay close attention to what they have to say.
41