Healthcare: Public or Private?

Amid all the hullabaloo about repealing the Affordable Care Act a little noticed meeting took place in Dallas in June.

Dr. Tom Price, the Secretary of Health and Human Services and former Georgia Congressman, met with eight Dallas doctors. How they were chosen is uncertain but the mix was representative of one of the things wrong with healthcare in America. Six of the doctors were male and represented surgical subspecialties or anesthesia. Two members were female and were family practitioners. The minimalizing of primary care input into the debate is regrettable.

The HHS website reported on the meeting that it was very long on complaints but very short on suggested solutions. Sort of like the majority party in Congress.

I have contended for some time that if I gave anybody a magic wand and said “Fix healthcare in America.” That person would be unable to come up with a solution acceptable to all.

President Obama reportedly said,” If we were starting from scratch, a single payer system would make sense.” But we aren’t starting from scratch. Our health insurance system evolved as a way to give workers benefits without raising wages. Then unions fought for it and it became an expectation. Then President Nixon introduced the Health Maintenance Organization Act of 1973 and the “BUSINESS” of Medicine was off and running. And thus we have large hospital organizations that one doctor said are really only construction companies funded by sick patients. It is hard to pass a hospital these days without a crane in the sky signaling more building. And those buildings must be utilized and thus the other thing difficult to escape is advertising billboards on major thoroughfares. Did you know the United States is only one of two industrialized country that allows direct advertising of prescription pharmaceuticals to consumers? (New Zealand is the other)  “Ask your doctor…”   has become as ubiquitous as “This Bud’s for you.”

Say what you will Big Pharma, Big Insurance, and Big Hospitals are not going away. I have always believed that single payer with its lower administrative overhead and universal coverage was the best solution in a perfect world. And it still may be the solution America ultimately comes to. But what do we do about all those health insurance executives and employees?

Consider this before you answer. According to CMS (the agency that administers Medicare/Medicaid) there is roughly one Medicare/Medicaid employee for every 21,800 insured lives. For Health Insurance Companies there is one employee for every 340 insured lives. In other words a CMC employee handles 64 times as many lives as does an employee of private insurance. Score one for single payer.

But are we going to put over 500,000 people out of work? I think not. So is there another way to consider? Many students of healthcare policy advocate for a system like Switzerland’s which utilizes private insurance. Although it is the second or third costliest of the industrialized nations it is still 6% lower as a percentage of GDP than the U.S. (17.3 % for U.S. and 11.5% for Switzerland). So a Swiss system might save 6% of our GDP, a significant amount. So what are the tradeoffs to an annual saving of upward of a trillion dollars? The tradeoffs are: 1) Coverage is mandatory. 2) The Government defines the basic minimum policy that must be offered. 3) The Government controls prices for hospitals and doctors.  And 4) although now only a Swiss healthcare proposal, Government negotiation of drug prices will produce further savings.

For conservatives the “G” word is anathema. But they must face the facts that no profit driven system for healthcare has ever worked without some control on usage and pricing. Somebody has to decide how we use these resources. The doctors who met with Price want unfettered ability to treat and charge what they like. I did too when I was in practice. But we are only a small part of one of our nation’s obligations to its citizens: to promote the general welfare. To solve the problem of healthcare we are all going to have to give up something. If we can agree on that then maybe a compromised solution will be possible.

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Retired physician, author, and nonprofit worker in Africa

3 thoughts on “Healthcare: Public or Private?”

  1. Speaking as a CPA in public practice who specialized in health care consulting for over a decade beginning in 2000, I have watched and wondered why health care CEO’s, who add absolutely nothing to the quality of healthcare in any form or fashion, have continued to milk that industry dry. In other words, they have bilked the health care industry for their 8 figure salaries while sitting on their lazy tails – while the docs – many who have been classically hoodwinked by these CEO’s – and nurses do ALL the actual work. The ONLY way out of this farcical conundrum is for America to adopt a single payer health care system, which will make healthcare available to every America citizen who needs and wants it. Consider this: The Administrative cost of Medicare is 2% of total Medicare premiums, whereas prior to the enactment of the ACA, aka Obamacare, the average Administrative costs of private health insurance providers was between 35-42%, depending on the company. The ACA limited those Administrative costs to mid-20%, depending on a few various factors. So forget the politics and consider a moral choice: Continue with the current Patronage system, or, a single payer system that provides health care for all which allows all our hard working doctors and nurses to return to focusing on their Hyppocratic Oath?


  2. Very nice post – I left an extended comment. See you two soon!

    Sent from my MacBookPro Michael Sparkman Author/Retired CPA & UCC Minister Santa Fe, NM

    “The opposite of love is not hate, rather, it’s the love of power over other people.” – Carl Gustav Jung



  3. I only know healthcare as a consumer, but I believe it should be a right for all people. Single-payer would seem to make the most sense, but that prompts me to ask a question. We’ve all heard stories about how long it takes to get a medical procedure done in Canada, and that many Canadians travel to the U.S. for care rather than wait. Is it because there aren’t enough people to schedule procedures in a timely manner? Not enough doctors? As for pharmaceutical ads on TV: I think that’s a big mistake, and I think that our government needs to set limits on drug prices. Candy companies can charge whatever they like for candy–as long as the market will bear it–but medicine should be affordable for those who need it. I don’t mind doctors making good money, but I don’t understand why hospitals/healthcare companies should be profit-generating for shareholders. If we don’t want the government running all our hospitals, couldn’t hospitals be set up as non-profits that are run by the private sector?


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