Problem is at the top

June 09, 2014

The Times Argus
By: Jerry Kilcourse, Montpelier

The recent article in The Times Argus by Peter Hirschfeld “Increases fuel single-payer debate” should call attention to our overly complicated and administratively heavy health care system. Until it is simplified with a universal/single-payer plan for all, health care costs will never be reduced or even contained. It is a systemic problem that incremental reforms such as the Affordable Care Act (Vermont Health Connect) will never fix.

For example: A recent article in the May 17 New York Times titled “Medicine’s top earners are not the M.D.s” illustrates that these top earners are health insurance CEOs, hospital CEOs and other hospital administrators. The average health insurance CEO is paid around $544,000, not including bonuses and other incentives. Not so incidentally, a previous CEO at Vermont Blue Cross Blue Shield got a $7million-plus “golden parachute” when he left.

Other examples focus on health administrative costs per capita for the U.S. compared with other countries.

Some are: U.S. $606; France $277; Germany $237; Canada $148; Norway $35.

In the above article, Rep. Don Turner thinks the way to contain costs is competition from more health insurance companies. In order for this to happen, we would have to return to the days of super-high-deductible “junk policies,” insurance underwriting or “cherry picking” the young and healthy only, and using pre-existing conditions to deny coverage or add exclusions to policies. Also such “free market” competition would do nothing to reduce the above administrative costs.