Editorial: Wary of concentrated health care

Staff Writer
Mount Shasta Herald

When politicians broach the subject of universal health insurance — as the Democratic contenders for the White House are — there's no shortage of critics to poke holes in the prospect.

They claim that bureaucrats will dictate which tests and procedures people qualify for. That patients will be restricted to a preferred pool of doctors. That strangers in faraway offices will deny people's claims. That Americans will surrender control over their most precious asset: their health.

This scenario sounds frightening ... and yet strikingly familiar. In fact it's a lot like the private insurance system we already have.

Participants of private managed-care plans (HMOs and PPOs) already feel less than in charge of their destiny. Those insured through employers have limited plan options, with pre-selected physicians and prescriptions. If their preferred docs and drugs aren't on the lists, too bad. Upon calling their insurer with questions, maybe they'll get a human being ... in a call center eight states away.

And those are the folks lucky enough to have insurance. Many Americans have had claims lost, screenings and services denied, coverage outright canceled. That's what happened to Percy Baker, former director of Peoria's Carver Center. His insurer dropped him as he awaited a heart transplant. He couldn't get new coverage because of a pre-existing condition. Now he faces tens of thousands in medical bills.

Could universal health insurance sponsored partly by government be that much worse?

Competition is supposed to drive down costs and give us options. But while we see competition among doctors and hospitals — often of the bricks-and-mortar variety, as in Downtown Peoria — competition among insurers is dwindling, causing some of the aforementioned problems. The big boys are gobbling up smaller, regional insurers nationwide.

The Peoria area is no exception. In 2005 one of the region's largest insurers, John Deere Health Care, was bought by national juggernaut UnitedHealthcare. Last month another central Illinois insurer, OSF HealthPlans, was snagged by Humana Inc. United and Humana serve a combined 40 million Americans. Add the other behemoths — Aetna and WellPoint, with a combined 50 million members — and nearly one-third of the entire U.S. population's health care is controlled by just four companies.

This is worrisome, says the American Medical Association, which has been monitoring the trend. Last year it published "Competition in health insurance: A comprehensive study of U.S. markets," which pointed out that large insurers' profits have skyrocketed since 2000, as have premiums, deductibles and co-payments — but without any corresponding increase in patient benefits.

"It is clear that patients — the ultimate consumers of health care — are not benefiting from these mergers," the AMA says. Indeed, in a bit of freaky economics, large insurers enjoy both monopoly and monopsony powers, meaning they can dictate terms to both buyers of health care (patients) and sellers of health care (docs and hospitals.)

Ironically, such powers represent the best argument for government-sponsored care. Size allows an insurance provider to pool risk among millions of people and to negotiate lower prices for services and drugs. Theoretically, government could do the same for the good of its citizens, and without the profit motive.

"The AMA is concerned that the United States is heading toward a system dominated by a few publicly traded companies that operate in the interest of shareholders and not primarily in the interest of patients," the report concludes. Yikes.

In truth there are horror stories about both private and public insurance. Look at Illinois, where the state's inability to pay Medicaid providers is legendary. That's one reason why the nation may be a ways from endorsing truly universal health care. On the flip side, there are customers perfectly content with their insurance, whether private or public.

But while America may have the world's best health care, insurance is the only gateway to that care unless people can afford to pay bills out of pocket. And as insurance becomes increasingly concentrated in the hands of a few big companies, consumers may fear losing access to coverage and losing control over decisions about their health.

The presidential candidates should be paying attention.

Peoria Journal Star