The University of Texas at Austin
  • Opinion: Closer to universal health care

    By Professor Ronald J. Angel, Department of Sociology
    Professor Ronald J. Angel, Department of Sociology
    Published: April 6, 2010
    Opinion:
    © 2010 Photos.com, a division of Getty Images

    Sixty-five years after President Truman proposed a national health care program and 17 years after President Clinton’s failed attempt to radically alter health care financing, President Obama, with the help of a Democratic Congress, finally passed a compromise bill that is clearly an improvement over the old system. The non-partisan Congressional Budget Office (CBO) estimates that the plan will save more than a trillion dollars during the next 20 years by increasing the pool of insured persons, and it will clearly greatly benefit poor and minority Americans who are currently uninsured. Of course, there is a real possibility of repeal, especially if the Democratic Party loses large numbers of seats in the mid-term elections. Several states have already mounted legal challenges to the legislation on constitutional grounds and states may succeed in imposing barriers to implementation. Most likely, though, the health care landscape of the country has changed for good and probably for the better.

    In addition to cost savings over the long term, the legislation benefits individuals and society at large in many other ways. Most obviously, insuring the health of the labor force represents a major investment in future productivity, which will be essential as the baby boom generations retire and as the U.S. finds itself competing with emerging economies like those of Brazil, China and India. The shorter-term advantages are also clear. In general, what the legislation does is make health insurance accessible to nearly all Americans, control its cost for middle class families, and place rational and needed restrictions on the health insurance industry.

    The basics of the legislation are by now widely available. There are too many specific aspects to summarize here, but among the most important are provisions that, either immediately or by 2014, ban health insurance companies from denying coverage to children or adults with preexisting conditions or dropping individuals when they become ill. Health insurance premiums will be monitored to identify those that are excessive. Insurers will also be prohibited from placing annual or lifetime limits on coverage. Middle class families and small businesses will receive tax credits for premiums. State health exchanges will be established to compete with the private market and to offer affordable coverage to individuals.

    The bill clearly improves health care access for minority and other poor Americans. Medicaid coverage will be expanded to an additional 16 million people. Eleven billion dollars will be provided to community health centers to increase their staffing and facilities; this will encourage poor individuals and families to seek preventive care. Another benefit results from the fact that Medicaid and Medicare payments to doctors will be increased. Many doctors do not accept Medicaid patients because of the low reimbursement and many poor families have trouble obtaining the care they need even when they have Medicaid. In addition, drug coverage for individuals on Medicare will be extended to eliminate the “doughnut hole” in drug coverage.

    The bill also deals with the potentially serious shortage of doctors that the country is facing as a large fraction of the current medical labor force retires. Scholarships and loan repayment programs will be available to train doctors, nurses and other medical professionals. Hopefully it will increase the number of minority physicians, nurses and ancillary medical professionals. Incentives will be offered for professionals to practice in under-served areas, a provision that will increase access in minority and poor communities. The legislation will also increase access to mental health services for individuals with mental illnesses and substance abuse disorders.

    Unfortunately the new legislation will not cover everyone. According to CBO estimates, by 2019 32 million individuals who would have been uninsured will be covered, but 23 million non-elderly adults will still be without coverage. One might ask who these 23 million individuals are — about a third are illegal immigrants who are not eligible for coverage and the rest consists of individuals with incomes below the individual mandate threshold. If the least expensive plan costs more than eight percent of one’s monthly income, then one can opt out. Other individuals will simply choose to pay the annual penalty rather than buy into the system. Even with less than universal coverage, though, the new legislation is a huge step in the right direction.

    I should mention what health care reform is not. It is not a complete and comprehensive overhaul or redesign of the health care system. Despite claims that it represents socialized medicine it does not. As health care costs increase toward 20 percent of gross domestic product, issues of efficiency and rationing will have to be addressed. Increasing health insurance coverage is a noble objective, but the current plan does not address the larger issues related to the organization of the health care system.

    • Quote 2
      Denny said on July 9, 2011 at 10:23 p.m.
      As Ronen Avraham, Professor of Law at the university of Texas at Austin, articulates, the following cost drivers of the present health care system have to be addressed and significantly improved upon: underuse, overuse, and misuse (which hopefully includes abuse). Neither the plan by the Democrats nor the plan by the Republicans addresses these three cost drivers. So the current health care system remains in need of reform at the least and a major overhaul at worse. Perhaps an example would help clarify my position. I have a friend who spent just over three hours in the emergency room at a small suburban hospital for a urinary infection. Other than a series of x-rays and an intravenous antibiotic, very little was done for my friend at the hospital. Her bill for this treatment was $4,600.00. To repeat professor Avaham's conclusion, "there is no cost-based way to justify such prices."
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      Bed Guard said on Nov. 16, 2010 at 11:30 p.m.
      health insurance should only be taken from reputable companies, you really don't want to get it from fly-by-night companies ~;"
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      Body Scrub Recipes : said on Oct. 28, 2010 at 8:33 a.m.
      of course health insurance is very much essential for your own sake`'`
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      Allison H. said on Sept. 28, 2010 at 4:38 p.m.
      I would like to re-quote Tom from above to reinforce his great point: "Also from a moral point of view I think anyone from a rich country that is willing to let someone else DIE because they don't have enough money for medical care is really in no position to lecture any other countries on anything least of all medical care." Thank you, Tom, for the rest of your post as well. And thank you Dr. Angel for a great summary and opinion!
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      Millionairematch said on Sept. 7, 2010 at 12:25 p.m.
      Legislation is passed for the benefits of the privileged few of the society. By enacting a legislation one can not make everybody a millionaire; but can provide good health care to millions of people who are at the lower end of the society. The poor can not match with the millionaires and they need a supportive Government.
    • Quote 2
      best answer said on Aug. 30, 2010 at 11:15 a.m.
      Great information... Thanks for the wonderful post... Keep up ur good work...
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      Gary Crosby said on May 8, 2010 at 5:59 p.m.
      Professor Ronald J. Angel your view is dead on. I totally agree. I think with the political process playing out with those on the conservative side and those on the liberal side, still a decision had to be made. From Presidents in U.S. history, many have tried to do something. I also feel that creating a new system was good, our country can build on this step with others. I think it's not helpful for instance for a poster to write here that we don't know what the cost of the bill now law is, and what it's based on. We do know that. I think we as a country have to be honest with each other, do we want to help and assist other Americans in their time of need. That answer should always be yes. Now, there is a number in the population that will never be responsible, that however can't be an excuse to not pass a bill to assist the needy or the financially impaired to acquire health insurance. So while the constitution doesn't state it's a right, I think this bill was a must. A must to give help, a must to offer a hand, a must to obligate ourselves as Americans to show we care. A must to say not in our country, no matter what the cost. We are Americans, and that's all that matters. The bill now law, will pan itself out in the long run. Our economy can't continue to handle the high cost without doing something, so let's see where this goes from here.
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      Jim '09 Grad said on April 11, 2010 at 7:37 a.m.
      Yes, health care for everyone is a good thing, but this bill in particular is not. Most people understand the benefits like having kids covered until they're 26, no denying of coverage because of pre-existing conditions, no lifetime caps, and better access for almost everyone. Those are all great benefits to society, but there is also the other side of the coin which is the economics of it. One doesn't have to hold a Ph.D. to understand who it is that will foot the bill. Just how is this going to fund itself? We are paying more in premiums now than in the past, but under this plan, they will skyrocket even higher than before with no opt-out clause since everyone will be required to hold some type of coverage. Whether the government can force an individual to buy a product from a private entity is another question being challenged right now in the courts. The CBO's projections don't factor in other negative byproducts like longer wait times, rationed care, higher tort costs, and a severe shortage of primary care physicians & nurses. Just look at similar experiments like health care in the UK, Canada, and most recently in Massachusetts on how this will work out. While most would like to have change to the system, this drastic overhaul is not what the country needs.
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      Tom said on April 10, 2010 at 11:15 p.m.
      For all you misinformed critics. I am from the UK but have lived in the states for many years. I have dealt with both the US insurance system and the UK National Health Service (if you call it government run you don't understand the NHS or the fact that private care is availble to whomever wishes to pay for it in the UK). The quality of care in the UK in my experience is equal to the US with regards to hospitals and surgery's (with the exception of elective sports injury surgeries which are better in the US because there are more violent sports and more Dr.'s practicing as sports surgeons) but it is much better with regard to GP (Primary Care doctor) and drugs under the NHS this is what reduces costs. I have never met anyone denied treatment in the UK nor anyone unable to afford the drugs they needed for chronic or life threatening conditions. I have met a multitude of people in the US who HAVE insurance who were turned down for treatments (one for cancer, many children with chronic conditions who my wife deals with in her job at a non-profit, many people who aren't insured so can't get the same sports surgery as I have had) and have seen people in obvious physical distress be ignored or escorted out of US hospitals (because they could not pay). Of the 4 insurance companies I have had here 2 have lied to me and told me I was covered for treatment only later to renege on this after the treatment has been done. From a cost point of view the UK system is far superior to the US one of letting insurers insure only patients they can make profits from and leaving the others to the US government and taxpayer (medicare and medicaid). Because everyone can get care when they need it in the UK conditions are treated at a point when they are far cheaper than they would be in the US (at a Primary Care physician rather than at the Emergency ward here). I understand people don't like change but before you criticize other countries medical systems you should at least experience them rather than take the word of TV channels and politicians who profit from the current status quo. The reason that health care costs are heading for 20% of GDP here (about the same amount the IRS takes in taxes!!!) and is only around 10% in other western democracies (the UK is about 8.9%) is because universal health care is much more efficient and therefore cheaper. If the current insurer system worked better than the NHS or other universal systems there would be no need for Medicare or Medicaid and your costs would be lower. Also from a moral point of view I think anyone from a rich country that is willing to let someone else DIE because they don't have enough money for medical care is really in no position to lecturer any other countries on anything least of all medical care.
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      mark said on April 6, 2010 at 10:02 p.m.
      Maybe the real answer to the perceived problem of universal health care and to the problem of some people having less than others is to simply pass legislation that makes everyone a millionaire (if you aren't one already). We can pay for it..... well the same way this legislation pays for health care.... exactly the same way.
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      Denise said on April 6, 2010 at 1:51 p.m.
      The fact is this is designed to put insurers out of business so that socialized medicine will "need" to be created. The regulations forcing a change in % of premium allowed to be used on nonmedical expenses (lights, salaries, phones, paper, etc.) are not going to allow these companies to remain afloat. Your quality will drop too. The brightest ad best will go into fields where they can make money, instead of medicine. You get what you pay for. Don't kid yourself.
    • Quote 2
      T. J. said on April 6, 2010 at 11:44 a.m.
      I'm a '98 UT MBA Grad. Obviously Professor Angel is biased in that he sees expanded coverage, elimination of exclusions for preexisting conditions, etc as a good thing. In that regard I share his bias. The recently passed legislation is far from perfect, but expanded coverage is good both from a moral and economic sense. If it is good to cover the old (Medicare) and the poor (Medicaid) makes sense to ensure everyone else has access. I know people who stick in jobs they'd rather leave for others or to start a business but don't because for example, they have a child with a preexisting condition. Freer flow of human capital will be an additional benefit with the legislation. And over time I'd look to see incorporation of more conservative touch points such as Tort Reform - the legislation isn't the final state for Health Care - but an important first step.
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      Daryle said on April 6, 2010 at 11:36 a.m.
      Nice article and I appreciate the positive opinions from Professor Angel. As stated, its unfortunate that it has taken 65 years for this type of reform to pass. Healthcare is one of the biggest drains on the American economy and its about time that we have elected officials who have taken an aggressive approach to moving forward with a solution to this dilemma. Although Right-wings may not agree on the way the bill was pushed through, Democrats had only done what the last mistake in office had been doing for years. Oversight and regulation of insurance companies has been long overdo and their ways of business has taken an economic toll on millions of Americans creating unaffordable health coverage. Oversight will also allow generic drugs to be more available on the market instead of drug companies preventing such availability. Also will save on readmissions to hospitals because insurance companies determine the amount of recovery time it will pay VS what may be recommended by health professionals providing the care. It will also control the wasteful spending and fraud on Medicare. Yes, the cost will be financed by adjusting the tax code so that the wealthiest pay more, but many tax laws were created to provide tax cuts for those same people. With that being said, it’s about time that the only industrialized country with no type of universal healthcare has finally adopted a plan for the future. You can find out more at: http://www.whitehouse.gov/omb/fy2010_key_healthcare/
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      Bill said on April 6, 2010 at 11:24 a.m.
      This article also does nothing to address how the bill is paid for and by whom the bill is paid. This IS the first step towards government run health care. We already see how well that works in the VA hospital system. We already see how well it works in the UK (tongue firmly planted in cheek).
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      Bill said on April 6, 2010 at 10:52 a.m.
      What if car insurance covered the cost of an oil change and new tires? That is what is being asked of healthcare by including doctor's visits. If we went back to the old 80/20 and only covered hospitalization, we could cover everyone in the US. The number of times the bill leaves something up to "the Secretary" is frightening.
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      Doug said on April 6, 2010 at 10:41 a.m.
      Merideth -- You can't really say things like "Facts are skewed. Information is lacking" without some details if you want to be taken seriously. Pick specific facts, and find citations that prove them wrong. Then find additional citations that provide the lacking information. It's obvious that the author put a lot of effort into this, and attacks like "The University of Texas should be embarrassed" are just plain rude. YOU should be embarrassed, and you owe him an apology (even if you can refute all his facts and conclusions, you still owe him an apology.)
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      m maxwell said on April 6, 2010 at 10:37 a.m.
      Come on....this is a Big Government takeover of 1/6 of our economy....another step toward limited Free Markets, Capitalism & Individual Responsibility. One of my Ah Ha moments at UT was There is No such thing as a Free Lunch. Now it is OK...... Totally disagree with this professor's article
    • Quote 2
      Michael said on April 6, 2010 at 10:02 a.m.
      Right on the mark: Objective and factual--I've researched this a great deal and work in the large non-profit health care insurance environment. It's the fearmongers who do more than skew facts--they invent them.
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      Benn said on April 6, 2010 at 10:01 a.m.
      What would it take to switch health care insurance to be more like Auto and home insurance? Also, why didn't the gov't get there hands OUT of the health insurance but lifting the ban on across state line competition and mandating required coverages. A man's insurance premium should not be more expensive to cover prosthetic breasts. Which goes back to my above question, individualized insurance for everyone. The insurance companies could offer multi-line discounts if family members wanted to be on the plan. Finally, if so many people were against the current health care plan, why was it RAMMED down our throats? If this is a universal problem, shouldn't there be a universal solution. How about consulting with those ACTUALLY in HEALTH CARE instead of a bunch of suits in a room in Washington determining something they know little about
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      Kip Ingram said on April 6, 2010 at 9:59 a.m.
      Honestly I believe we've come to a point in our society where we can no longer truly trust any source of information on a topic as controversial as this one. All this article tells me, for sure, is that its author supports these changes to the health care system. It's very sad, but I have almost entirely lost trust in the media, "experts," and virtually every other source of information. Everyone has an agenda and is more interested in advancing that agenda than providing objective information.
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      Maribeth said on April 6, 2010 at 9:53 a.m.
      I was wondering if Meridith could elaborate. Not trying to pick a fight, just want to know both sides of the story. Which facts were skewed?
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      Sherri Pomeroy said on April 6, 2010 at 9:48 a.m.
      The new health care bill misses the mark, not doing nearly enough to provide affordable health care to all residents of this country. I think that far too many of our health care dollars go towards health insurance administration opposed to health care. The industry has destroyed American health care...in various ways. Overpayment for hospital charges insurers fail to examine (example: I was billed for two babies when my son was born), inept administrators who have little to no medical education making decisions about coverage,(example: My company payed for an MRI labeled with and w/o contrast. On the same bill was a charge for the same MRI with contrast. The insurance company may have paid for their share of it, but I called and had the bill corrected, not wanting to fork over my 20% for the same MRI twice.) These errors and mistakes cost ultimately cost the insured in the form of increased premiums. My premium? $3400 a month! Yes, you read that correctly. So, to address the opinion you express in your summation, that the new health care bill is closer to universal coverage...I have to disagree. People like me, self-employed, self-insured will probably not be able to continue coverage under ever escalating premiums. I have been with the same company since 1997. They do not cover pre-existing conditions yet have raised premiums from an initial $200 a month to the $3300 I pay today...as mentioned. Then there are the uninsured that the new health care reform bill doesn't even begin to address. If you consider the new health care bill closer to universal coverage...all I can say is a miss is as good as a mile. Sherri Pomeroy
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      N. Kibbe said on April 6, 2010 at 9:37 a.m.
      Thank you for this review of the coverage. I've heard so much from the fear mongering media that it's been difficult to learn of the true advantages of the system. Thanks a million!
    • Quote 2
      Meredith - Texas '84 said on April 6, 2010 at 9:31 a.m.
      I wholeheartedly disagree with this post. Facts are skewed. Information is lacking. The University of Texas should be embarrassed.
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