PDA

View Full Version : Busting the low admin costs of medicare myth



sack316
03-19-2010, 03:21 PM
Chart below provides an example of how Medicare is actually far less efficient than is claimed when held in comparison to private insurance.

How do they boast such low rates of overhead and get away with it (the 3% figure). Statistical sleight of hand. The comparative figures the gov't uses to sell us on their efficiency is apples to oranges.

Because medicare is dedicated to serving the elderly, and therefore in greater need of medical care more often than the average consumer, it generates significantly higher spending than private insurance plans (i.e. they spend more $$$ overall on care). This factor creates a lower ratio of administration costs to expenditures, therefore giving the appearance of a model of efficiency. The actual admin costs are great, it's just the ratio that allows the percentage as a whole look so much lower (due to volume).

Making an apples to apples comparison (cost per person)you'd find that Medicare's administrative costs on that basis comes out 24.8% HIGHER today than private insurers.

See charts below, illustrating the apples to apples comparison for years 2000-2005

So statistically, once a pool of beneficiaries enters the gov't market, the aforementioned ratio will rise, growing closer to the private insurers figures as the consumer base increases and is not limited to the elderly. The flipside is that the per-person cost would actually decline. At which point I'm sure THEN the gov't will decide to use those figures instead (i.e. at that point they will then point to the per-person cost decline after a pre-open option was initialized) and then ignore the rise of the overhead % they are using to try to sell us on the idea now.




http://timerealclearpolitics.files.wordpress.com/2009/06/admincosts1.gif

Sack

pooltchr
03-19-2010, 03:36 PM
Are you suggesting that government healthcare might actually be more expensive than private healthcare??????


Steve

sack316
03-19-2010, 03:47 PM
While I'm sure that would be true as well, in this instance I'm only saying that per person, the administrative costs of Medicare are, in fact, much higher than that of private insurance.

So while their little 3% figure is indeed accurate, the "how and why" that figure is arrived at is incredibly misleading in terms of what they are using it to represent.

Sack

Sev
03-19-2010, 03:58 PM
Say it isnt so Sack. Say it isnt so!!

LWW
03-19-2010, 04:38 PM
Please, stop interjecting the truth to cult members.

It gets them very riled.

LWW

Qtec
03-20-2010, 01:24 AM
Not surprised you never posted a link. Its a RW think tank! Geez, they even call HC reform 'Obamacare'!!!!!

See the two ** next to Administrative spending under the Medicare column? Scroll down and you will see,
"** <span style='font-size: 17pt'>Author's calculations based on <u>Benjamin Zycher</u> </span>...

Who is B Zychler?

Here is a quote from him.



<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> “Now, let me be blunt: Michelle Obama, the product of lifelong affirmative-action coddling, is an intellectual lightweight who fancies herself a serious thinker. Just read her Princeton senior thesis, an intermittently coherent stream-of-consciousness pile of leftist jargon, campus pseudo-seriousness, and racial-identity babble. Can there be any doubt that the Princeton administrators accepted it only because of her skin color?”</div></div>

You tried anyway.

Q

Gayle in MD
03-20-2010, 01:37 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body">Not surprised you never posted a link. Its a RW think tank! Geez, they even call HC reform 'Obamacare'!!!!!

See the two ** next to Administrative spending under the Medicare column? Scroll down and you will see,
"** <span style='font-size: 17pt'>Author's calculations based on <u>Benjamin Zycher</u> </span>...

Who is B Zychler?

Here is a quote from him.



<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> “Now, let me be blunt: Michelle Obama, the product of lifelong affirmative-action coddling, is an intellectual lightweight who fancies herself a serious thinker. Just read her Princeton senior thesis, an intermittently coherent stream-of-consciousness pile of leftist jargon, campus pseudo-seriousness, and racial-identity babble. Can there be any doubt that the Princeton administrators accepted it only because of her skin color?”</div></div>

You tried anyway.

Q </div></div>

I believe Sack used the same slanted source for his response to my thread about the top 15 Executives who are bilking the country, making their profits by dropping people, and stuffing their profits in their pockets.

Biggovernment .com???

/forums/images/%%GRAEMLIN_URL%%/smirk.gif

Gimme a break!

LWW
03-20-2010, 03:46 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Qtec</div><div class="ubbcode-body">Not surprised you never posted a link. Its a RW think tank! Geez, they even call HC reform 'Obamacare'!!!!!

See the two ** next to Administrative spending under the Medicare column? Scroll down and you will see,
"** <span style='font-size: 17pt'>Author's calculations based on <u>Benjamin Zycher</u> </span>...

Who is B Zychler?

Here is a quote from him.



<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> “Now, let me be blunt: Michelle Obama, the product of lifelong affirmative-action coddling, is an intellectual lightweight who fancies herself a serious thinker. Just read her Princeton senior thesis, an intermittently coherent stream-of-consciousness pile of leftist jargon, campus pseudo-seriousness, and racial-identity babble. Can there be any doubt that the Princeton administrators accepted it only because of her skin color?”</div></div>

You tried anyway.

Q </div></div>

That is classic Q.

You complain about a non-link and then post a comment unsupported by a link.

By the way HF is among the most accurate and non biased sources in the land, of course that's why the left hates them ... they deal in realities.

LWW

sack316
03-20-2010, 05:51 AM
Actually, if you must know, there was no link because it was a result of my own study of the numbers.

If you can prove me wrong (either on your own or through another's work) then I will happily look at it and accept it if you can factually show my error (either through process, math, or whatever).

But in this instance, this was my own study (easy check is to copy/paste sentences into google to see if any match up, or there are some instructor websites that will allow you to check the originality of the work).

But as a longstanding member, and agree or disagree with my beliefs, I think all would find me to have been quite honest over all this time (hey, you all know my problems with alcoholism, etc.).

But I did research on this as a project, and my finding has yet to be disproven... even by a liberal professor who I requested to do the leg work on to in order to "show him". So a PhD with 20 years of teaching college stats, economics, and finance could not find a flaw in my method or findings.

If one of you can, I welcome you. But as I said in another thread, the best I've seen so far as a retort is that the IMAGE HOST was an admittedly questionable site. The facts, numbers, and stats, are all legit. Prove me wrong.

Note: "proof" doesn't mean saying I'm a righty, or that an image was hosted on big gov't, or that Bush did something. Proof is showing a factual error in the stats I used (ie. that faulty numbers were used to begin with) or the math used to arrive at the conclusion was wrong, or that the application of the findings were used in a questionable manner. I await a real reply.

Sack

Sev
03-20-2010, 06:48 AM
Lets face it Sack the health care numbers are stacked. They make assumptions based on a static state projected into the future. The future is unknown and nothing is static. They are trying to predict the weather many years in the the future.

I would predict that all the taxes collected from this bill will go the way of Soc Sec. Washington cant help itself. They will start borrowing against it and when the plan goes to be enacted there will be no money to support it.

To trust in fiscal responsibility and restraint in Washington is a fools errand. The historical precedent says Washington will fail to uphold obligations and we will be left with another bankrupt bureaucracy.

sack316
03-20-2010, 07:16 AM
All of that is true. Fact is, nobody can know. You and I will sit here and look at other gov't fiascoes and say "surely they will miss projections and estimates and wind up in an even bigger hole.

But, like you said, we cannot predict the future.

Case may also be that it would wind up being a financial miracle, and one thing after another may fall into place and could possibly be the greatest financial investment we have ever seen.

The real truth is, none of us really know. Some of us foresee good, some of us bad. But in truth, nobody on this board or Washington know for sure. I can't say what will happen, and that wasn't the point of this thread really.

All I do know is what I presented thus far as fact. Those numbers are what they are for now, and if I am shown to be wrong I really don't mind that. In fact, I'd actually hope to be proven wrong on this one considering the direction the legislation seems to be heading. And even if I am not, and my figures hold up for the "here and now", that is really no definite on what tomorrow may be. This year, or even in '09 once stats are complete may show Medicare as the most efficient method around. I doubt it, but we don't know yet. But as said from the start here, with what we do know, and what we are being sold on... is smoke and mirrors, apples and oranges.

Sack

Gayle in MD
03-20-2010, 07:24 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: sack316</div><div class="ubbcode-body">Actually, if you must know, there was no link because it was a result of my own study of the numbers.

If you can prove me wrong (either on your own or through another's work) then I will happily look at it and accept it if you can factually show my error (either through process, math, or whatever).

But in this instance, this was my own study (easy check is to copy/paste sentences into google to see if any match up, or there are some instructor websites that will allow you to check the originality of the work).

But as a longstanding member, and agree or disagree with my beliefs, I think all would find me to have been quite honest over all this time (hey, you all know my problems with alcoholism, etc.).

But I did research on this as a project, and my finding has yet to be disproven... even by a liberal professor who I requested to do the leg work on to in order to "show him". So a PhD with 20 years of teaching college stats, economics, and finance could not find a flaw in my method or findings.

If one of you can, I welcome you. But as I said in another thread, the best I've seen so far as a retort is that the IMAGE HOST was an admittedly questionable site. The facts, numbers, and stats, are all legit. Prove me wrong.

Note: "proof" doesn't mean saying I'm a righty, or that an image was hosted on big gov't, or that Bush did something. Proof is showing a factual error in the stats I used (ie. that faulty numbers were used to begin with) or the math used to arrive at the conclusion was wrong, or that the application of the findings were used in a questionable manner. I await a real reply.

Sack </div></div>

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">Bottom Line

Perhaps the most contentious proposal for healthcare reform is the inclusion of a "public option" insurance plan that Americans could choose to take. The fate of a public option is very much in doubt at this time, and the details of such a plan are far from settled. But these data suggest that Americans who currently receive government-subsidized healthcare -- those on Medicaid or Medicare -- rate their healthcare similarly to the ratings of those who are privately insured.

It is not clear what the results discussed here might mean for satisfaction with a public healthcare option if it came to pass. <span style='font-size: 20pt'>The fact that Americans' ratings of their healthcare differ little, whether they have a private or a government plan, suggests that a properly constructed government health plan may not necessarily lead to perceptions of reduced quality or poor coverage from its beneficiaries.</span> However, the fact that a public-private gap in quality ratings appears to exist for non-seniors (who presumably would be most likely to use a new public option) suggests that views about government-sponsored healthcare may differ by demographic group, possibly depending on one's likelihood of being affected.

</div></div>

http://www.gallup.com/poll/122663/private-public-health-plan-subscribers-rate-plans-similarly.aspx

Many Medicare patients are being refused by doctors and clinics. What will we do as costs continue to rise.

Truly the only sensible way is single payer. As indicated in my other thread, Walter Reed offered excellent care for our soldiers, until against the Army's preference, it was outsourced to a subsidiary of Hallibutron, the contracts rigged to insure they were the lowest bidder. After that, it was a nightmare over there.

There are many issues involved, but the system if broken, and it must be fixed.

How do you purpose to fix a system of Health Care for profit??? Which more and more Americans cannot afford, and which is rising at an incredibly fast rate, and we pay more, but statistically, we are not as well taken care of as the industrial societies who provide universal care. What about THOSE statistics????

What about people dropped by Medicare because of fraud?

The statistics can't tell the human story.

G.

sack316
03-20-2010, 07:34 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Gayle in MD</div><div class="ubbcode-body">

The statistics can't tell the human story.

G. </div></div>

No they can not. But they sure are used as a selling point to try to convince us of the story. I just showed the true side of what the numbers mean, and truly are.

And twice now you've mentioned how doctors are cutting off the service to people who do use the gov't system that is in place. Is going single payer, gov't option going to make that any better? Doctors are pretty smart folks... and if they can make more money being vets and dentists, I'd imagine that's where the good ones would go.

We don't disagree on the need for change. We all know there needs to be some type of reform. It's where in the long chain of things that the reform should take place that is the difference, IMO. And it may well be that "top level" that needs some of it... in fact I'm nearly sure of it. But that alone will not fix the true problem. And no, I do not know the solution. I wish I did.

Sack

Sev
03-20-2010, 07:40 AM
38 states are now preparing constitutional challenges and lawsuits against the health care bill should it pass.

That is enough to call a constitutional convention.

Gayle in MD
03-20-2010, 07:47 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: sack316</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Gayle in MD</div><div class="ubbcode-body">

The statistics can't tell the human story.

G. </div></div>

No they can not. But they sure are used as a selling point to try to convince us of the story. I just showed the true side of what the numbers mean, and truly are.

And twice now you've mentioned how doctors are cutting off the service to people who do use the gov't system that is in place. Is going single payer, gov't option going to make that any better? Doctors are pretty smart folks... and if they can make more money being vets and dentists, I'd imagine that's where the good ones would go.

We don't disagree on the need for change. We all know there needs to be some type of reform. It's where in the long chain of things that the reform should take place that is the difference, IMO. And it may well be that "top level" that needs some of it... in fact I'm nearly sure of it. But that alone will not fix the true problem. And no, I do not know the solution. I wish I did.

Sack </div></div>

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> And it may well be that "top level" that needs some of it...</div></div>

Not clear on what you are referencing, but the main reason why Medicare patients are dropped, according to doctors, is because of the squabbling from the private insurers over payment.

Right now, we have a system where private insurance dictates.

Given their main drive is profit, I don't see how anyone could deny that our care, costs, and satisfaction will contiue to decline.

Greed is the one thing we can always count on, and greed is heartless.

Makes me think about a sign I saw in town last week.

"No Government Run HealthCare! Don't touch my Medicare!"

/forums/images/%%GRAEMLIN_URL%%/laugh.gif /forums/images/%%GRAEMLIN_URL%%/crazy.gif

G.

Gayle in MD
03-20-2010, 08:11 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: sack316</div><div class="ubbcode-body">Chart below provides an example of how Medicare is actually far less efficient than is claimed when held in comparison to private insurance.

How do they boast such low rates of overhead and get away with it (the 3% figure). Statistical sleight of hand. The comparative figures the gov't uses to sell us on their efficiency is apples to oranges.

Because medicare is dedicated to serving the elderly, and therefore in greater need of medical care more often than the average consumer, it generates significantly higher spending than private insurance plans (i.e. they spend more $$$ overall on care). This factor creates a lower ratio of administration costs to expenditures, therefore giving the appearance of a model of efficiency. The actual admin costs are great, it's just the ratio that allows the percentage as a whole look so much lower (due to volume).

Making an apples to apples comparison (cost per person)you'd find that Medicare's administrative costs on that basis comes out 24.8% HIGHER today than private insurers.

See charts below, illustrating the apples to apples comparison for years 2000-2005

So statistically, once a pool of beneficiaries enters the gov't market, the aforementioned ratio will rise, growing closer to the private insurers figures as the consumer base increases and is not limited to the elderly. The flipside is that the per-person cost would actually decline. At which point I'm sure THEN the gov't will decide to use those figures instead (i.e. at that point they will then point to the per-person cost decline after a pre-open option was initialized) and then ignore the rise of the overhead % they are using to try to sell us on the idea now.




http://timerealclearpolitics.files.wordpress.com/2009/06/admincosts1.gif

Sack </div></div>


<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> Recent Attacks on Single Payer Health Reform: Ideology Masquerading as Scholarship
By David U. Himmelstein, M.D. and Steffie Woolhandler, M.D., M.P.H.
Some conservative opponents of single payer health reform have been claiming that new research proves that Canada’s single payer national health insurance program has performed poorly, and that projected savings on administration are illusory. In the commentaries below we analyze the two most prominent examples of this new research a paper by June and Dave O’Neill (“Health Status, Health Care and Inequality: Canada Vs. the U.S.”) and a report by Bejamin Zycher (“Comparing Public and Private Health Insurance: Would a Single Payer System Save Enough to Cover the Uninsured?”).
The O’Neill’s “Health Status, Health Care and Inequality: Canada vs. the U.S.“
A recent paper by June and Dave O’Neill contests previous research findings that health outcomes are better in Canada than in the U.S. The O’Neills also claim that income-based health disparities are larger in Canada than in the U.S., that access to care is better in the U.S. and that cancer screening and survival are worse in Canada.
The O’Neills collected no new data. Their analysis rests on idiosyncratic, highly selective and overtly biased reinterpretations of previously published data — mostly from the Joint Canada/U.S. Survey of Health (JCUSH), a population-based survey conducted jointly by the U.S. and Canadian government statistical agencies. While they extensively cite the few pieces of published data that supports their grim view of Canada’s health system, they ignore a large body of research and statistics that conflicts with their portrayal.
We will briefly discuss the main assertions in the O’Neill paper.
1-Canada’s lower mortality rates are not a result of better health care
The O’Neills assert that Canada’s longer life expectancy (2 years longer) and lower infant mortality rate (5.3 deaths/1000 live births vs. 6.8 in the U.S.) have nothing to do with health care. Rather, they claim that non-medical factors such as substance abuse, obesity, low education and “cultural factors” explain the U.S.’ poor performance.
They argue that high infant mortality in the U.S. simply reflects the high frequency of preterm births and low birth weight, and especially the very poor outcomes among African-Americans. American’s short life expectancy, they say, comes from high rates of obesity, as well as homicides and accidents.
But the U.S.’ high rate of prematurity and low birth weight is, largely, a result of poor care — inadequately treated infections and chronic illnesses among pregnant women, and the shockingly frequent failure to deliver adequate prenatal care. 16% of pregnant women in the U.S. receive no care at all in the first trimester of pregnancy, far higher than in Canada.
While the O’Neill’s dwell on the high obesity rates in the U.S. as an important non-medical cause of mortality differences, they ignore Canada’s significantly higher smoking rate — a graver threat to health than obesity. Moreover, they cite data from the OECD that exaggerates the obesity differences, ignoring the more reliable JCUSH data that they use for most of their other comparisons (presumably because the JCUSH found more modest differences in obesity rates).
They emphasize that accidents and homicides account for a large fraction of the U.S./Canada mortality difference among young adults, age 20-24. But deaths are rare in this age group, and accident/homicides account for virtually none of the difference in older age groups, where almost all of the deaths occur. In fact, differences in heart disease cause most of the Canadian advantage — a difference that almost certainly reflects, at least in part, better access to care in Canada.
The O’Neills also ignore the fact that the U.S. had a lower infant mortality rate than Canada’s until the passage of national health insurance (NHI) in Canada, after which Canada’s rate fell sharply. Similarly, they never mention that most of Canada’s advantage in life expectancy emerged shortly after NHI was implemented.
In many of their data tables on mortality and other health measures, the O’Neills’ separate out white from minority Americans, and indicate that Canadians’ health outcomes are similar to those of white Americans. Of course, excluding minorities in the U.S. means excluding one third of the entire population, and more than three quarters of the poor. In essence, they want to exclude the 100 million poorest and sickest Americans, and compare the remainder to a cross section of Canadians, including the sick and poor.
2-Other measures besides mortality rates are better indicators of the quality of health care in the two nations, and the U.S. comes out well on these.
The O’Neill’s simply assert that self-reported health status (the answer to the question “How would you rate your health? Excellent, good, fair or poor?”) is a better measure of the impact of the health care system than are mortality rates. Yet this measure has never been validated for cross national comparisons of the type they make, and it seems very likely to be greatly affected by cultural norms. And, as with death rate comparisons, only by eliminating minority Americans from the comparison can they conclude that the U.S. looks slightly better than Canada.
They then compare the two nations using a “health utility index” and the percent of people with pain that limits their activities. For both of these, Canadians do better than Americans, until minorities are subtracted from the population.
Finally, they compare the prevalence of chronic condition like diabetes, emphysema and arthritis in the two nations, and the proportion of people with each condition who are getting treatment. They conclude that while slightly more Americans are chronically ill, more of them are getting treatment. But millions of uninsured Americans with chronic illnesses like diabetes or high blood pressure are unaware of their diagnoses because they can’t afford the doctors visit or lab test needed to make the diagnosis. Surveys will not identify undiagnosed persons as having chronic disease. Hence, the proportion getting treatment is falsely inflated in the U.S. Moreover, even the differences they cite to favor the U.S. are not statistically significant. Hence, a more accurate depiction of the data would state that among people who know of their diagnoses, rates of care are similar in the two nations.
3-More Americans get cancer screening and the U.S. has more high tech health resources than Canada
The O’Neills cite higher screening rates in the U.S. for cervical cancer (PAP smears), breast cancer (mammography), colon cancer (colonoscopy or sigmoidoscopy) and prostate cancer (PSA testing). Only the small PAP smear difference is real.
For mammography, they include all women 40-69 in their calculation of screening rates. But neither the American College of Physicians nor the Canadian Task Force on Preventive Health Care recommend mammograms for all women 40-50. Mammograms for women in this age group leads to more breast surgery and other cancer treatments, but has not been shown to lower overall mortality. It is likely that most of the difference in breast cancer screening is due to higher screening rates among young women in the U.S., who may even be harmed by excessive mammograms.
There’s a similar problem with their analysis of colon cancer screening. They include people age 40-69. Yet standard guidelines do not recommend colon cancer screening in normal risk individuals before age 50. They’ve fudged the data to get a result they want.
Neither the U.S. Preventive Services Task Force nor its Canadian counterpart recommend routine PSA testing because its not at all clear that such testing does more good than harm — it turns up lots of false positives, including many small tumors that would never cause serious problems if left untreated. Routine screening may well lead to many unnecessary operations that leave men incontinent and impotent. Yet the O’Neill’s interpret Canada’s lower PSA screening rate as an indicator of poor quality care.
We may ultimately find that PSA screening or early mammography saves lives — or causes more harm than good. But at present, we just don’t know whether the lower use of these technologies in Canada is a good thing or a bad one.
Their analysis also trumpets the greater number of CT scanners and MRI machines in the U.S. as an indicator of better quality. Yet recent estimates suggest that in the coming years radiation from CT scans may cause as many of 2% of all cancer deaths in the U.S. — about 30,000 excess deaths annually. It is far from clear that the greater use of CT scanners in the U.S. (relative to Canada) causes more good than harm.
4-Waits for care compromise access in Canada, and these access problems are worse than those in the U.S.
The O’Neill analysis admits that fewer Canadians than Americans report an unmet health need (11.3% vs. 14.4%). In the U.S., cost is the big problem, while waits for care are more prominent in Canada. They try to obfuscate the Canadian advantage on access measures by presenting a complex sub-group analysis of pain suffered by those unable to get care. But when you cut through their obfuscation, even this measure favors Canada; about 12% more Americans who say they’re unable to get care report being in pain.
5-Cancer mortality rates are higher in Canada, indicating worse cancer care
The O’Neills claim that mortality rates for lung, breast, colon and prostate cancers are lower in the U.S. than in Canada. They calculate mortality rates by dividing cancer deaths by the number of cases of cancer.
When cancer death rates are calculated in a more standard fashion, i.e. the number of deaths per thousand people in the population, age adjusted cancer mortality is actually lower in Canada than in the U.S. for all of these cancers except colorectal cancer. But there are more cancers diagnosed in the U.S. Hence, the death rate among those who are diagnosed — the figure the O’Neills choose as the most important - is lower in the U.S.
This higher incidence of cancers diagnosed in the U.S. probably reflects more intensive screening programs, which diagnose more people with cancer. But, as stated above, its far from clear that diagnosing small prostate cancers based on PSA screening causes more good than harm. Most elderly men with prostate cancer do not die of that disease, but of heart disease or some other illness. (It is likely that some breast and lung cancers that are diagnosed through screening would also never come to light without screening.) In the U.S., these men with small, non-lethal cancers appear in the denominator of the O’Neill’s calculation of cancer mortality rates, but not the numerator. In Canada, they appear in neither the numerator nor denominator. Thus, their estimate of cancer mortality rates is biased against Canada because of the higher screening rate in the U.S.
6-Income-based health disparities are, if anything, steeper in Canada than in the U.S.
The O’Neills admit that health differences between those above and below the median income are sharper in the U.S. than in Canada. In fact, the differences between the top and bottom 10% are also bigger in the U.S., as are those between the top and bottom 25% etc.
But the O’Neills want to measure health inequities on a new scale. They observe that the rich in the U.S. are much richer than the rich in Canada, and the poor are much poorer. Rather than comparing high and low income persons, they decide to analyze how much worse health gets for each dollar decrease in income. Since the U.S. income gradient is much steeper, this analysis automatically makes the health per dollar gradient less steep. Notice that this method would find that a nation with almost no income inequality would automatically have very steep health inequalities.
Here’s an example. In Country A, the top 1% has an average income of $60,000 and a mortality rate of 100 per 1000. The bottom 1% has an average income of $30,000 and a mortality rate of 130 per 1000. Then, according to the O’Neills’ method for each $1000 increase in income, the mortality rate rises 1 per 1000.
In Country B, the top 1% has an average income of $603,000 and a mortality rate of 100 per 1000. The bottom 1% has an average income of $3,000 and a mortality rate of 300 per 1000. Then, according to the O’Neills’ method for each $1000 increase in income, the mortality rate rises only 1 per 3000.
So the O’Neills’ calculus would judge the income/health gradient less steep in Country B (where the poor have a death rate 300% higher than the wealthy) than in Country A (where the poor have a death rate 10% higher than the wealthy).
7-What’s left out?
The O’Neill’s paper cites dozens of references. But they fail to mention any of the numerous previous studies that directly address the questions they seek to answer. These include:
1-Previous analyses of the JCUSH data by the National Center for Health Statistics (http://www.cdc.gov/nchs/pressroom/04news/firstjointsurvey.htm) and by our group at Harvard (http://www.ajph.org/cgi/content/abstract/96/7/1300), which found a far different result.
2-The many published studies directly comparing the quality of medical care in the two nations for cancer patients, renal dialysis patients etc. 38 of these studies were included in a systematic review which concluded that, on average, mortality rates are 5% lower in Canada (http://www.openmedicine.ca/article/view/8/1).
3-The large body of literature showing that Canada’s health care system is far more efficient, with administrative overhead that is a small fraction of the U.S. level (http://content.nejm.org/cgi/content/short/349/8/768)
4-A recent analysis of deaths that could be prevented by good medical care ranked the U.S. worst among the 19 nations studied, well behind Canada which ranked 6th. Moreover, while Canada’s ranking improved between 1997 and 2003, the U.S. fell further behind. (http://content.healthaffairs.org/cgi/content/abstract/27/1/58)
There is much to criticize in Canada’s health care system. But the O’Neill’s analysis strays far from legitimate scientific discourse, mixing selective citation and creative accounting that is intellectually dishonest.
<span style='font-size: 20pt'>Bejamin Zycher’s “Comparing Public and Private Health Insurance: Would a Single Payer System Save Enough to Cover the Uninsured?”</span><span style='font-size: 20pt'>Benjamin Zycher, an economist at the right wing Manhattan Institute, has recently issued a report disputing claims that a single payer health care reform would realize large administrative and overhead savings. We will briefly respond to the main arguments in Zycher’s paper.</span>1-Medicare’s administrative costs are far higher than the figure given in the National Health Accounts.
<span style='font-size: 14pt'>The National Health Accounts indicate that administrative costs account for only 3% of total Medicare spending (vs. 14% in private insurers). But Zycher wants to add to this a proportional share of all government spending. That is, he claims that 14% of the President’s salary, the cost of Congress, the FBI, the federal courts etc, should be attributed to Medicare, since Medicare accounts for 14% of federal spending. Based on this, he estimates “true” Medicare administrative costs at 6% of total outlays, and concludes that potential savings on insurance overhead is only 8% of premiums, not 11%.
Zycher’s argument assumes that expanding Medicare to cover all Americans would drive up the costs of all government agencies, Congress etc.</span><span style='font-size: 20pt'> — an absurd assumption.</span> Would we really raise the president’s salary, or a senator’s pay as part of implementing a single payer system? In fact, there is no reason to posit increases in any such costs, and <span style='font-size: 20pt'>the Canadian experience suggests that Medicare’s overhead could actually be reduced to about 1% by simplifying hospital and physician payment.</span>2-The higher taxes needed to fund national health insurance would cause massive economic losses that more than offset any administrative savings.
<span style='font-size: 20pt'>Zycher argues that every dollar collected in taxes by the government actually costs the economy about $1.76 because of foregone private investment. He wants to add a large portion of this cost to Medicare’s overhead, arriving at an estimate that overhead consumes 52% of total Medicare spending.
First, his estimate of the economic consequences of taxation is questionable at best. His assumption that the taxes raised for NHI would come from investment, not from existing health care expenditures, is unfounded. Its simply crazy to posit that money flowing to health care through private insurers provides strikingly more stimulus to the economy than the exact same amount flowing through a government insurance plan.
3-Private insurers’ overhead is not really wasteful.
Zycher admits that Medicare and NHI achieve large savings on underwriting, advertising etc. But he argues that these activities are good things because they “align premiums with costs”, stop the healthy from cross-subsidizing the sick, and make everybody pay the true costs of their own care. He assumes that a market-based health insurance system — which minimizes risk pooling and cross-subsidies - must be most efficient. Therefore, the costs of administering such a market are, by definition, not waste but a necessary part of efficiency.
Of course, he does not and cannot adduce any evidence that a market-based health insurance system is actually efficient. In fact, the overwhelming evidence indicates that it is far less efficient than NHI.</span><span style='font-size: 20pt'>4-What Zycher leaves out.
Zycher’s arguments completely ignore the massive administrative waste that private insurers inflict on hospitals, doctors, nursing homes etc. In fact, insurance overhead accounts for only one-quarter of total health care administrative costs in the U.S. The complexity of our current reimbursement schemes requires providers to fight with insurers for payment for every aspirin and bandaid. This requires a huge administrative staff, billing computers etc.
In contrast, a single payer system could greatly streamline providers’ paperwork. Paying hospitals on a lump sum budget basis — e.g. as a fire department is currently paid — could cut hospital administration costs in half. Similar savings could be realized by simplifying doctors’ billing.
In sum, Zycher’s analysis falsely inflates Medicare’s overhead costs, makes outlandish assumptions about the economic costs of taxes vs. premiums, attributes unsubstantiated social benefits to advertising and insurance underwriting, and ignores the massive administrative burden borne by providers.</span></div></div>


http://www.pnhp.org/facts/single-payer-faq#publicl_financed

<span style="color: #000066">Which of our two examples would be the least partisan????

G. </span>

sack316
03-21-2010, 06:12 AM
<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Gayle in MD</div><div class="ubbcode-body">
Which of our two examples would be the least partisan????

G. </div></div>

Neither of our quoted information above is partisan. What you posted was a fine article with well thought out and quality information as far as I can see. Mine takes the accepted statistics that are already out there, and comparatively looks at admin costs in an apples to apples basis (which while it was a good article you posted, it has nothing of direct response to that unit of measurement).

It's like having a car that goes 100mph, and someone else has a car that goes 140km/h. Well both sound cool, both can get you from A to B, both may well be perfectly acceptable means of transport. But if you do want to look at top speed as a factor, it is helpful to convert it into the same units of measurement for comparison.

Sack