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Cure Health Disparities With Real Reform

The debate over health care reform has taken a particularly worrisome turn. Suddenly we’re in a place where passing something kind of like reform may be more important than getting to reform itself. In the name of "compromise" and in interest of getting something passed, we could get a health reform bill that helps fewer people than originally intended, and preserve more of the status quo than almost anyone wants.

For minorities low income families and individuals, that means more of the kind of disparities — in access to care, quality of care, and health outcomes — that are all too common in our present health care system. The 2008 National Health Care Qualities & Disparities report spells out some of these disparities, including: higher rates of disease, access to care, and lack of routine care and prevention.

In a recent report, the Kaiser Family Foundation further documents persistent disparities between women of color and white women on a wide range of diseases, including diabetes, heart disease, AIDS, and cancer. (The Washington Post reported two years ago that black women get less cancer treatment — a fact that particularly hit home with me, having a mother and sister who are both breast cancer survivors.) The report found that there are "racial and ethnic disparities in health status and health care in every state in the nation, often disparities that are quite stark."

It adds up to what Deepak Bhargava referred to as "America’s Health Apartheid," which cuts across ethnic and gender lines — exacerbating discrimination with a health care system that ultimately rations care based not on need but on the ability to pay.

History tells us that ignoring inequality tends to further entrench its insidious causes. It’s imperative that we begin an honest debate about the fundamental reality that health care access and outcomes in America are radically unequal.

Consider these facts:

  • Hispanics are twice as likely to die from diabetes. Tuberculosis strikes Asian Americans at 16 times the rate of whites. Cancer kills 35 percent more African-Americans than whites.
  • If two patients have similar heart disease, a black patient is one-third less likely to undergo life saving bypass surgery than a white patient.
  • Among preschool children hospitalized for asthma, only 7 percent of black and 2 percent of Hispanic children, compared with 21 percent of white children, are prescribed routine medications to prevent future asthma-related hospitalizations.
  • One of the most dramatic predictors of health is access to insurance and while 11 percent of whites are uninsured, about 32 percent of Latinos, 20 percent of blacks and 17 percent of Asian Americans have no health coverage.

Coming to grips with these complex problems will require a diversity of responses that address socio-economic and cultural realities that extend far beyond the dominant cost and coverage discussions we have seen so far. It’s simply untrue that getting people "coverage" and controlling costs automatically solves America’s health equity problems. Equity can only begin to be addressed if the plan is affordable and comprehensive, only if all immigrants are eligible, only if primary care is available in low-income communities and only if providers are culturally competent.

In a system where care is a commodity — as opposed to a necessary component of "life, liberty, and the pursuit of happiness," it indeed becomes a privilege for those who can afford to purchase it from those who sell it at a profit. Therein lies the problem.

In fact, the insurance industry has grown quite adept at avoiding sick, low-income, or minority applicants altogether, as Forbes magazine’s David Whelan noted.

Insurance companies find ingenious ways to get healthy members in the door while being inconvenient to sickly applicants. That’s bad news for reformers, who imagine an egalitarian world that doesn’t discriminate against the sick. The four health care proposals now getting the most attention in Congress all require HMOs to offer coverage to all who apply, regardless of their health status.

Good luck with that. Insurance companies will have a financial motive to attract and keep the healthiest members, the ones who don’t rack up hospital visits or take costly medications. If Obama Care means HMOs will have to compete with a new public plan, a disproportionate number of unhealthy people will end up in the latter.

Health plans started playing games with Medicare in the early 1990s–when the program started its experiments with privatization, paying a fixed amount to private health insurers for each member they could sign up. HMO companies would hold seminars for prospective new members on the third floor of elevatorless buildings or in places that required a long drive. You could count on only the fittest and most self-sufficient seniors to show up. Others would recruit at a 5k charity run or offer gym memberships as a perk and pat themselves on the back for promoting fitness. Barbells are not of much interest to those who are demented, bedridden or in a wheelchair–all health care gobblers, notes Paul Precht of the Medicare Rights Center.

Insurers would also structure benefits so that sick patients would be deterred or never re-enroll. "If you didn’t want to attract cancer patients you would put in copayments and coinsurances that were less attractive than [regular] Medicare," says George Rapier, a doctor in San Antonio whose 60-physician practice contracts with Medicare HMOs.

That’s because profit driven insurance counts money spent paying for health care as a "loss."

What drove [Wendell] Potter from the health insurance business was, well, the health insurance business. The industry, Potter says, is driven by "two key figures: earnings per share and the medical-loss ratio, or medical-benefit ratio, as the industry now terms it. That is the ratio between what the company actually pays out in claims and what it has left over to cover sales, marketing, underwriting and other administrative expenses and, of course, profits."

Think about that term for a moment: The industry literally has a term for how much money it "loses" paying for health care.

The best way to drive down "medical-loss," explains Potter, is to stop insuring unhealthy people. You won’t, after all, have to spend very much of a healthy person’s dollar on medical care because he or she won’t need much medical care. And the insurance industry accomplishes this through two main policies. "One is policy rescission," says Potter. "They look carefully to see if a sick policyholder may have omitted a minor illness, a pre-existing condition, when applying for coverage, and then they use that as justification to cancel the policy, even if the enrollee has never missed a premium payment."

…The issue isn’t that insurance companies are evil. It’s that they need to be profitable. They have a fiduciary responsibility to maximize profit for shareholders. And as Potter explains, he’s watched an insurer’s stock price fall by more than 20 percent in a single day because the first-quarter medical-loss ratio had increased from 77.9 percent to 79.4 percent.

At the root of health care disparities is this reality: in a profit driven system, those whom it is not profitable to serve — though they need health care — simply get left out.

That doesn’t mean they don’t get care. They just go to emergency rooms, in ever increasing numbers. It doesn’t mean the don’t pay for care either. In fact, they pay dearly, to cover care that they employer-based health insurance might have covered before layoffs and job-losses, or for expensive treatment of acute conditions that might have been prevented with access to affordable health care. (Those of us with health insurance pay as well, with an extra $1,000 a year in premiums.)

There’s a higher price paid as well, by people like 12-year-old Deamonte Driver, whose death in 2007 put a human face on health care disparities, and may well inform the current debate.

The death of 12-year-old Deamonte Driver a few miles from the Capitol reminded lawmakers of the disparities that dental-care advocates had been warning about for years. One of these was David Satcher, who as U.S. surgeon general in 2000 called oral disease a "silent epidemic" afflicting millions of minority and low-income Americans.

Deamonte, who had been living in a homeless shelter before moving into his grandparents’ mobile home in Clinton, died from a dental infection that spread to his brain. A routine, $80 tooth extraction might have saved his life. As is the case with many poor families, transience as well as problems with transportation, phone service and mail delivery complicated the Drivers’ search for care. The death spurred congressional hearings and gave lawmakers and the public new insights into failings within the Medicaid system charged with providing dental care to millions of poor children. The revelations led to reforms of the system in Maryland. Often invoking Deamonte’s name, Cummings went on to help lead a successful fight for the inclusion of a dental entitlement for the children of the working poor under the reauthorization of the State Children’s Health Insurance Program, or S-CHIP. The bill, vetoed twice by then-President George W. Bush, was signed into law this year by President Obama.

Like a lot of health care reform critics, Whelan spent a great deal of time explaining what he thought wouldn’t work, but none on what changes would work to end a status quo that ignores inequality on one hand and profits from it on the other. Like a lot of critics, he comes up short on fixes for the stark disparities in our current health care system. He comes up short on answers for how to save, or avoid even having to save, the next Deamonte Driver.

Private insurers have already promised to stop practices like charging women higher premiums, denying care to those with pre-existing conditions, and denying care to people who get sick — just please don’t make them compete with a public plan, and they promise to change their behavior. But the reality is that we’ve heard it before.

You can see, at various points along the timeline above, insurance companies opposed from the beginning any efforts to provide Americans with affordable, quality health insurance. Though the Clinton plan was the most recent attempt at universal health care in the U.S., what’s happening now bears more resemblance to 1977 than 1994.

That’s the last time the health insurance industry made a "voluntary effort" to control costs, after President Carter proposed tougher cost controls. The result was the Hospital Cost Containment Act of 1977, passed without cost controls, and a "voluntary effort" that didn’t last very long.

More than a decade before the Clinton experience, then-President Jimmy Carter called for legislation to impose cost controls on hospitals as a way to rein in rising medical expenses. The industry came forward and said don’t bother with legislation, we will cut costs voluntarily. "Congress never passed cost controls and six months later there was no sign of voluntary cost controls," recalled Robert Blendon, professor of health policy and political analysis at Harvard.

Health care spending soon surged again, and kept rising until 1993-1994 when — again threatened with real change in policy — the industry behaved itself just until the threat passed, and went back to business as usual.

The health care industry had more thirty years, and at least two obvious changes to change practices and policies that served profits more than patients, and put the health and lives of many Americans at risk. In 1977 and in 1994, they engaged in the kind of behavior a child does when he moves his vegetables around on his plate, and claims he’s eating them.

There’s no one way to erase the disparities that are exacting a huge cost, both in terms of money and human lives. But there are some changes we definitely need:

  • A public plan is essential, and it must be one that sets benchmarks for quality, efficiency, and affordability that private insurers are unable or unwilling to set for themselves.
  • Covering everyone is essential, and if that means private insurers have to "eat their vegetables," so be it. Otherwise they will go back to what they’ve always done as soon as they can get away with it, and in doing so make the public plan ineffective.
  • Regulating private insurance is essential, because they’re not providing people with a commodity they can reasonably do without. Health is an essential part of the whole "life, liberty, and pursuit of happiness" thing. Lack of access curtails that pursuit.

That’s not the whole way "there," but it’s a good start. Increasing access to health care at the community level will be important, as Bhagarva notes in his own suggestions.

Health Empowerment Zones: Much of the inequality in our system is traceable to specific geographic communities that disproportionately experience depravation. Designating such communities as health empowerment zones would allow the creation of incentives in underserved areas to attract culturally competent health care professionals, create disease management programs for the critically ill and improve data collection to better document minority health care trends.

Community Health Centers: Community health centers provide excellent-quality health care, with outcomes comparable or exceeding those in private settings. With a proven record of removing barriers to care, improving health outcomes while reducing health disparities and generating substantial cost savings, CHCs should be candidates for substantial increases in resources.

The inequality in our system has complicated causes. The only possible silver bullet in addressing the moral outrage of racial disparity is honesty. We can’t be afraid to talk about the reality of differential treatment and to work diligently as a nation for comprehensive solutions which hold us to our ideals of equality.

Health care disparities have deep roots in systemic in equality, and addressing those disparities is essential if we’re to achieve real reform. We have to honestly face not only those disparities but the reality that it cost all of us, for the sake of enormous profits for only a very few, if we’re to achieve health care for all.

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