Just in case you thought I’d cooled down from my rant about UnitedHealthcare, don’t think for a second I’m letting them off the hook. After reading some N&O letters to the editor on the topic, I discovered that WIlliam McGuire, United Healthcare’s recently-departed CEO, pocketed $124,000,000 in compensation last year. Now that McGuire lost his job he is broke and penniless. He was last seen rummaging through garbage cans.
Ha ha! Just kidding! Actually, he left with one of the largest ‘golden parachutes’ in corporate history: $5 million a year for life and an eye-popping $1 billion plus in stock.
This is the kind of shit I’m talking about when I talk about the healthcare industry. It is an industry, and you and I are being taken for a ride. There is an ungodly amount of greed involved. Sickening, actually (no pun intended). America could do so much better if it made affordable health care the right of every citizen. Even our screwed-up government would have a hard time squandering this kind of money.
Dear Mark,
You’re absolutely correct!
Sincerely,
Social Security
A lot of public cant takes the position that more of the costs of medical coverage needs to be pushed to the users of the service. The theory is that will cause those users to force reforms leading to cheaper and higher quality medical services. Anyone who has ever arrived at an emergency room with a sick child knows how little truth there is in this argument. Can you picture the scene? Pompous hubby negotiating with pompous medical officialdom over the costs and extent of services while beautiful child suffers. Presumably, the Mother sits on the sidelines dutifully backing her husband’s fierce struggle to right the wrongs of the world… I DON”T THINK SO!
At some companies, you get a chance to choose the plan you want in a broad sort of way. These choices are really only choice of deductible, upper coverage level, and monthly deduction. You hope that your company looked at the range of programs and negotiated the best set of plans for it’s employees. You know that they also considered the finances and administrative complexities of the deal independent of what would have been good for you.
When you talk to people in the medical industry that solicit payments for services from insurance companies, they will tell you that the nightmare expense for them is private pay insurance. Every company has a different plan, a different set of forms, a different payment pattern. This requires either people overhead, expensive soft, or both. Administrative expenses are somewhere near 40% in the industry. (This based on my memory of conversations with people at NCIPH and NCHICA during a contract.)
The “medical industry” is a peculiar industry. It is made up of huge insurance carriers and tens of thousands of little cottage medical shops. Most providers of service are small offices of partnered doctors. On top of that are hospitals ranging from one room clinics to huge plants dominating the countryside with their sprawl and parking lots. Add in drug companies and the government regulators, and the poor customers and you have an industry that looks more like a riot than the organization implied by the term, industry.
I think that this “industry” needs a major reform. I don’t think the overpaid CEOs, the inattentive board rooms, and the disorganized patients are the places where that reform will occur. There needs to be a much more prominent role played by government in the medical industry.
I would think that any thoughtful plan would: address the multiplicity of forms and procedures that raise administrative costs, standardize the way medical records are stored allowing for easy exchange of information across providers, provide for fair review of medical disputes, and equitable distribution of costs (universal medical coverage?). I’m looking forward to the coming debates 🙂
I am assuming this is MT’s response (With the “new” format, I have no way of knowing!)
I love all of your suggestions in the final paragraph with the exception of “universal medical coverage”. That is an even bigger disaster waiting to happen.
I normally HATE new gov’t laws, but I would entertain new laws for the following, “address the multiplicity of forms and procedures that raise administrative costs, standardize the way medical records are stored allowing for easy exchange of information across providers, provide for fair review of medical disputes”.
Good write up!!
Todd Leonard
Actually that was my friend, Ralph, a quite insightful man indeed.
I’m working on getting the commenter’s name displayed again. Perhaps when I get a minute between travels and work.
A lot of people like to talk about the advantages of socialized medicine without letting the debate of socialized drawbacks into the conversation. Remember, in a socialized medical system the needs of the state come first, patient needs are secondary. Scratching your head over that one? Take a look at US hospitals that are providing surgeries for Canadian and British patients who have conditions that were not determined to be critical enough to warrent treatment in their own hospitals. True, they would eventually be assigned a surgeon to treat their ailments but that schedule is dictated by the state, not the patient.
And as for the pervious anonymous poster who wrote:
“Pompous hubby negotiating with pompous medical officialdom over the costs and extent of services while beautiful child suffers. Presumably, the Mother sits on the sidelines dutifully backing her husband’s fierce struggle to right the wrongs of the world”
Could that have been any more 50s? I’m just picturing Ward arguing with Dr. So-and-So while Jane comforts the crying Beaver. Oh the huge manatee..
If you believe socialized medicine is a disaster, you don’t fully appreciate the disaster we’re stuck with now.
Greg, my dear friend, go back and read the account of my son’s hospital visit in Italy and my subsequent thoughts on it. It was truly eye-opening how medicine could be done from a compassion motive rather than a profit motive.
I believe socialized medicine forces the state to take greater care of its citizens, knowing it will be picking up the tab if it doesn’t. Environmental laws, workplace safety laws, product safety laws are all more strictly enforced if it means keeping the citizens healthy.
One day soon Americans will use telemedicine to consult with doctors in India and elsewhere. They will get top-notch healthcare for a fraction of what they’d be charged here. Then the outrageous fees charged by the medical industry will come crashing down.
Those cushy pharma jobs will disappear as well, likely outsourced to India. How ironic!
I’ve said it before, and I’ll say it again: Health insurance companies need to be non-profit organizations. They exist to provide an essential service to the public, not to provide outrageous “golden parachutes” to their execs (or in this case, a “platinum parachute”). I don’t see how UnitedHealthcare’s former CEO could have done anything for the company that was worth 124 freakin’ million dollars worth of compensation during his entire lifetime, let alone one single year!
Mark isn’t the only person who’s pissed about the overpriced, indifferent health care that we receive in this country….
First off, non-profit doesn’t mean people don’t make money….it just means the business books don’t show a profit at the end of the year. Examples are United Way and Red Cross who both had Executives making exorbitant amounts of cash.
Anyway, its disturbing to see my libertarian friend defend a “Single Payer” solution. Its socialism and once in, will be hard to get out. I’m sorry but I don’t believe we have a “right” to health care.
I actually do believe that insurance companies are the cause for a lot of the problems but only from the standpoint that they entrenched themselves as a “benefit” that people expect. They pushed themselves into the market as a way to help companies lure potential candidates and its helped to escalate prices because people don’t care that if an xray costs $50 or $300 because they’re only paying $20. No incentives to shop around. No incentives to complain.
Well, I think insurance should only be for catastrophic events and your doctor visits should be out of pocket. But, hey I guess I’m just a heartless bastard.
Scott
I’m sorry but I don’t believe we have a “right” to health care.
When that guy on the street too poor to afford health care coughs and gives you the gift of tuburculosis, perhaps you’ll reconsider. When the News and Observer gets its wish and a worldwide avian flu epidemic breaks out, perhaps you’ll reconsider. Viruses don’t care if you’re covered. It makes sense to catch them as soon as possible through widely-available health care.
When people too poor to afford health care get sick, we all pay for it: through increased infections, taxes, and/or insurance premiums.