Our current health care “system” is in crisis. Colorado consumers have seen sky-rocketing premiums (82% increase 2000 – 2004 for families, 140% increase 2000 – 2005 for small employers) and plummeting benefits. So what has changed over the decades? Profit. We’ve seen a corporate take-over of healthcare and most people don’t know what hit them. Ever wonder what is really driving up the cost of our healthcare? I want to share with you my assessment of the problems and some of my thoughts on solutions.

• Pharmaceutical Advertising: Companies are spending billions per year on direct television advertising for prescriptions (a practice that used be illegal under federal law that is driving up the cost of prescription medicine.) Most are spending 4 or 5 times as much on marketing as on research.

Solution: Reinstate prior federal prohibition against direct TV advertising for prescription drugs (FEDERAL).

• Overcharging Insurance Premiums: Most states require a rate-review process before an insurance company can file rate increases. Colorado doesn’t. Colorado allows insurance companies to file rate increases in any amount, at any time, without any oversight. It works well for them ($$$), but not so well for consumers.

Solution: Implement insurance rate review for price gouging in Colorado (STATE).

• Cuts in Funding Public Research: As the states and federal government pulled back on funding public research there are fewer public medical patents. Private companies now own most of the patents, allowing monopolies over healthcare pricing, driving up the cost of healthcare.

Solution: Increase publicly funded research and therefore publicly held healthcare patents consider reducing duration of healthcare patents (STATE & FEDERAL).

• Introducing For-Profit Hospitals: Historically, most hospitals have been non-profit institutions or religious institutions. Now almost all of Colorado’s hospitals are owned by 3 big corporations. This has meant pressure to cut services, cut staffing levels, cut payment to providers, cut services but increase charges to increase maximizing profit. Colorado hospitals are making 4.5 times as much profit as the national average. They spent $2.25 billion in new buildings in Colorado.

Solution: We need to decide if we fundamentally believe healthcare should be a for-profit or non-profit model. Strengthen medical anti-trust laws (FEDERAL).

• Slow Payment or Non Payment of Medical Bills: Because denials of payment are so common now in healthcare most medical providers have had to hire billing specialists, even entire billing departments to try to get paid. When carriers require multiple transactions to pay the same bill, it drives up the cost for providing the same service.

Solution: We need prompt pay reforms (STATE) and ERISA reforms (FEDERAL).

• Healthcare CEO Payment: During the 1980’s the average CEO made 40 times the amount of their employees. That figure is now 500 times the amount of their employee. Cumulatively, CEOs are receiving billions in salaries, bonuses and stock options. You are paying for it. According to Forbes, The heads of America’s 500 biggest companies received an aggregate 54% pay raise last year. (United Health CEO $1.6 billion in stock options, $124 million annual salary)

Solution: Better healthcare CEO and profit disclosures and consider introducing a cap adjusted for inflation or tighter rules on perks (STATE & FEDERAL).

• Administrative Bloating: Administrative costs in healthcare are now eating up almost a third of every health care dollar. While every system requires administration. An estimated $286 billion dollars could be saved in administrative costs alone according to a Harvard / Public Citizen Report.

Solution: Consider an audit to better determine the source of the waste. (It appears to use more resources to deny healthcare than to pay claims. STATE & FEDERAL).

• Increased Errors in Healthcare: While some have tried to blame patients and cut off remedies, the reality is that medical errors are the 8th leading cause of death in the U.S, causing 98,000 preventable deaths every year. We need to prevent the errors in the first place. Only 13% of those physicians with 5 or more medical malpractice claims are ever even disciplined. Given that only 5% of physicians are responsible for 54% of the medical malpractice, we could save a lot of harm to human beings and cost to the system by taking the licenses of frequent offenders.

Solution: I carried and passed whistleblower protection for healthcare workers reporting errors and public disclosure on doctor’s history of discipline and malpractice. Need additional reforms in Medical Board (STATE).

• Insurance-Directed Healthcare (Short-Term v. Long-Term Costs): Under the HMO or managed care models, insurance companies are telling doctors how to practice medicine and pushing them into higher risks of malpractice and withholding care. This has led to unprecedented interference with the ability of doctors to practice medicine without interference. Short-term “cost-cutting” leads to more catastrophic care or need for chronic treatment for conditions that could have been treated for less money earlier on.

Solution: Redefine unlawful interference with practice of medicine and prohibit practice of treatment pre-clearance by people who are not licensed and qualified to practice medicine. (STATE)

• Wrongful Denial of Treatment & Claims: The amount of refused treatment and unpaid claims is on the rise with increased number of loopholes allowing denial of care (pre-existing, forms not right, not pre-approved, exclusions for certain conditions, exclusions for certain treatments). We used to have stronger remedies under bad faith laws against carriers who failed to pay the claims they owe. Those laws have been gutted.

Solution: Strengthen our insurance bad faith laws and increase jurisdiction and enforcement by the Insurance Commissioner (STATE) and fix ERISA so it doesn’t block consumer protection by the states (FEDERAL).

Lobbyists for the pharmaceutical industry, the insurance industry and the for profit hospital and healthcare industries have flooded your State Capitol, your U.S. Congress, your newspapers, and your television. They have pushed for a no-accountability standard for them and a reduction of rights, remedies, benefits and coverage for you – all in the name of reducing your healthcare premiums. (They call it “cost containment”.) So have your premiums gone down? We need to stop listening to the special interest groups that are the problem so that citizens can reclaim the quality of life we deserve in the United States of America.

Have other ideas or suggestions for healthcare reform?

Blue Ribbon Commission for Health Care Reform
303 E. 17th Avenue, Ste. 400
Denver, CO 80203
Tel: 1-888-776-2332
Fax: 303-837-8496
E-mail: 208commission@coloradofoundation.org
Website: www.colorado.gov/208commission

The Blue Ribbon Commission on Healthcare Reform “208 Commission” is meeting over the summer to make policy recommendations to the legislature in 2008.

Rep. Morgan Carroll
1165 Ouray Street
Aurora, CO 80011
Tel: 303.866.2942
Email: morgan.carroll.house@state.co.us
Website: www.repmorgancarroll.com

This entry was posted on Wednesday, August 1st, 2007 at 5:19 pm and is filed under Elected, State Legislative Races, 2007 Legislative Session, Democratic Issues. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.