State Profile: Hawaii

Based on what happened here to me, I don’t think there’s one thing wrong with the American health care system. It is working just fine, just dandy.

-Rush Limbaugh, speaking about his experience with Hawaii's health care system. 

Was the billionaire broadcaster correct about health care in Hawaii? And is it indicative of the health care offered by the other 49 states? Yes and no. According the American Human Development Report (2005), Hawaiians live longer than residents of any other state (81.4 years). According the New York Times, Hawaiians are bullish about a system that leads the nation in breast cancer cure rate and where insurance premiums are among the lowest in the country as well as the lowest Medicare costs per beneficiary, despite Hawaii's high cost of living.

There's another major difference in Hawaiian health care, one that sets it apart from every other state: Employers must purchase health insurance for any employee who works more than twenty hours a week. All in all, about 90% of non-elderly Hawaiians have health insurance. (Elder Hawaiians are, of course, covered by Medicare.) Certainly, some employers duck the requirement by keeping hours under twenty a week or by simply refusing to pay. Others, though, are proud of the generous benefits afforded their employees.

The law is simple enough: Employers provide standardized health plans with no co-pays, low deductibles, and limits to out-of-pocket expenses. This in turn results in low administrative costs of around 7%. Employers purchase either a pre-approved plan, one they select subject to approval, or provide a self-funded plan. They may share costs with employees up to 50% or 1.5% of an employee's gross monthly earnings.

Hawaii does face problems with its health care system: The recession and the accompanying rise in unemployment has increased the number of uninsured, reflecting an inherent weakness in employer-based health care; the small hospitals of the outer islands face serious financial problems; and state health care benefits do not extend to long-term care, which has been plagued by a lack of liability insurance. Moreover, its geographic isolations and lifestyle may boost its outcomes. Nonetheless Hawaii's outcomes combined with its low cost of health care in a high cost-of-living state suggest the health and economic advantages of universal and equal access.

Click here to learn more about health care in Hawaii.

Battle Joined

Jay Inslee

Rob McKenna

Last March, Washington state Attorney General Rob McKenna joined twelve other Republicans and one Democrat in suing to overturn the Affordable Care Act. McKenna, a rare Republican to hold statewide office in Washington state, has been AG for seven years and is regarded as the presumptive nominee for governor in 2012. Should McKenna be elected, he would be Washington's first Republican governor since 1985.

Historically, McKenna has positioned himself as what long-time Washingtonians call a "Dan Evans Republican," after the popular moderate who occupied the state house from 1965-1977. From this light, McKenna's decision to join the lawsuit seemed puzzling: The ACA is by no means unpopular in western Washington, where the great majority of the state's population resides. To be elected governor, McKenna must peel off a significant number of western Washington's Democrats and Independents. Why McKenna has risked alienating them and galvanizing liberal opposition in order to secure an eastern Washington base that he is in no danger of losing remains a mystery. On the other hand, McKenna has long thrived in an area that is a political Death Valley for Republicans, so there's little doubt that he took his position without long consideration.

McKenna's expected opponent, seven-term Congressman Jay Inslee (WA-1), lost no time in attacking McKenna's position on the ACA. (Disclosure: I have known Inslee since his election in 1998.) Warm and thoughtful, Inslee is no mean politician himself: In 1998, he drew attention from around the country when he campaigned against incumbent Republican Rick White's support of Bill Clinton's impeachment. (Arguably, MoveOn.org drew its name from Inslee's campaign.) Inslee defeated White in a close election, then in 2000 became the first Democrat in the history of the First District to win reelection. He has won every race since then by a comfortable margin. Unlike McKenna, Inslee has not positioned himself as a centrist: Inslee is an unapologetic liberal who also happens to be an effective representative.

And, he is a strong supporter of the Affordable Care Act. Inslee has been direct in opposing Washington's participation in the lawsuit and has worked diligently to make McKenna's active support of the suit an early issue. McKenna, Inslee says, wants to have it both ways: He advocates overturning the ACA while claiming to support its key consumer provisions. McKenna responds that the real issue is about the constitutionality of the law:

People sometimes forget what this lawsuit is actually about: the constitutionality of the health care law. That’s what every judge who has ruled on the matter understands. As Judge Vinson most recently observed, the health care law should be revised in order to make sure it does not violate the Constitution.

And as Attorney General McKenna has said, he does not believe that every section of the new law, including protections for those with pre-existing conditions, violates the Constitution.  McKenna supports the need for affordable, accessible health care for the people of Washington and their families—he just doesn’t think we need to violate their Constitutional rights to give it to them.

So far, McKenna has not explained how the consumer protections he supports can be enacted successfully without the compulsory insurance at the heart of the bill.

In any event, the ACA is shaping up as a major issue in the 2012 Washington state gubernatorial election, as the expected main candidates include one of the bill's staunchest supporters and its most visible statewide critic. Both are formidable candidates whose strength will put Washington in the political health care spotlight in 2012.

Emergency Emergency

This afternoon, I went on a hard-hat tour of a satellite emergency facility, expected to open next month as part of my local community hospital's health care system. Besides state-of-the art equipment, the building will house twenty primary care physicians, specialty care, a test lab, and a diagnostic imaging lab. Patients will sit in comfort in chairs that will unfold into examining beds, blood tests will occur on site with results returned as close to instantaneously as possible, and Electronic Medical Records will be instantly synced with the main hospital IT system.

The facility will include a conference room for group consultations -- for example, a dozen diabetics might meet with their doctor and a nurse for instruction in lifestyle changes. Should I have the misfortune to need the emergency room, the expected wait time is 15-17 minutes. This will be at least the fourth such facility in my suburban area to go with three hospitals, each of which has its own Emergency Department.

Obviously, this will be one of the better areas in the country to need emergency care.

Which at first blush makes stories like this all the more perplexing:

A 10-year old boy in Arizona had a severe asthma attack and couldn’t breathe. An ambulance was called, but all the hospitals near his home were full and on diversion, including two children's hospitals. The closest open hospital did not admit children, but opened to take him, even though it was also overwhelmed. While waiting for a treatment room to open up, the child waited in the hallway on the ambulance gurney for several minutes. He died in the hallway, before he could be seen by even a nurse, because all the staff were overwhelmed caring for other critically ill patients...

A patient was boarding in my emergency department, waiting for an inpatient bed to open in the hospital.  His family gathered around him and was forced to make end-of-life decisions with him while he lay dying on a gurney in a hallway...

An elderly man came to the hospital with weakness, pneumonia and new onset of renal failure with very high potassium levels. He arrived at 10 pm and we were unable to move him to an ICU bed until 4 pm the following afternoon. 

All over the country, Emergency Rooms face increasing pressure, although the reasons for this are more complex than one might think. Certainly uninsured people use the ER, but most patients have Medicare or Medicaid. Reimbursements have become so low that many physicians refuse to see Medicaid patients, and so they resort to the ER. The shortage of primary care physicians contributes as well.

Still, at a time when emergency departments are closing and urban wait times increase, it's not an accident that the facility I visited is located in a hospital district with a per capita income of over $100,000 or that there are nearly as many emergency facilities the greater suburban area as in the more populous urban core. At the end of the day, emergency care is rationed, too: The uninsured and underinsured who resort to urban emergency departments because they have no other choice have access of a sort, but it's hardly equal access.

The Tragedy of the Ten-Million Acre Bill

President Franklin Pierce

I readily and, I trust, feelingly acknowledge the duty incumbent on us all as men and citizens, and as among the highest and holiest of our duties, to provide for those who, in the mysterious order of Providence, are subject to want and to disease of body or mind; but I can not find any authority in the Constitution for making the Federal Government the great almoner of public charity throughout the United States. To do so would, in my judgment, be contrary to the letter and spirit of the Constitution and subversive of the whole theory upon which the Union of these States is founded.

Franklin Pierce, in his veto of the 1854 Bill for the Benefit of the Indigent Insane

Though forgotten today and though issued by a one-term president whose name is synonymous with Oval Office mediocrity, the veto of the Bill for the the Benefit of the Indigent Insane became one of the most long-reaching vetoes in the history of the presidency. With it, Franklin Pierce derailed an early attempt to define a wide federal responsibility for the general welfare; the government would not seriously consider a broad role in this arena until forced into it by the social blight of the Great Depression.

Three times before, in 1848, 1850, and 1852, the great social reformer Dororthea Dix had petitioned Congress for a land grant that would fund asylums for the indigent insane. Three times, her request disappeared into the maw of conflicting interests and philosophies about the proper disposition of federal land. Only a few politicians considered her request from the moral angle. Finally, in 1854, she prevailed, only to see President Pierce veto the Bill for the Benefit of the Indigent Insane.

Pierce vetoed the bill on three grounds. First, he wrote, nothing in the Constitution authorized Congress to pass this kind of legislation. Second, however worthy the bill might be, enactment would open a floodgate of federal welfare legislation. Third, care of the indigent insane was properly the right and responsibility of individual states. Dix, of course, pursued the legislation in the first place because in her mind the states had abdicated their responsibility.

Dix used her powerful personality in the cause of social reform. Her organizing skills were limited, though, and she did not respond to Pierce's veto with a lobby or movement. Subsequent 19th C. progressives did not pursue health care reform of any kind even when they had the organizing ability. Because of the precedent set by Pierce's veto, the federal government did not significantly involve itself in social reform legislation until the New Deal (with of course the notable exception of the bills underlying Reconstruction).

And so Pierce, a president whom historians have described as "timid and unable to cope with a changing America," established the terms of a debate that resound today. In terms of promoting the general welfare, what is the proper extent of the federal role versus those of the states and private philanthropy? Or is the question itself disingenuous? In some matters, perhaps leaving the general welfare up to the states is a rationalization that accepts injustice in the interests of limited government and the advantages that brings to special interests.

For liberals and progressives, Dix's defeat taught a lesson that went largely ignored for 75 years: Congress is unlikely to pass social reform legislation out of a sense of moral imperative. Social reform legislation requires organization, a skill progressives finally mastered and applied during liberalism's great era stretching from 1933-1965. Today, despite the left's inability to mount a large-scale progressive movement, the lesson of 1854 is reflected in the efforts of thousands of community organizations across the United States. One of their members became president.

To read more about this fascinating episode in American history, see The Social Service Review, Vol. 36, No. 1, March 1962 (link unavailable).

Country Profile: Belgium

Population 10,400,000

Government Federal parliamentary democracy

Health Care Model Bismarck

GDP 395B (2010 est.)

%GDP spent on health care 9.5

Per capita income $37,900

Health care expense per capita 3,563 (adj.)

Health care expense per capita normalized to income of 50K 4,700

Life expectancy (m/f) 77/82

Health life expectancy (m/f) 69/73

Overview

• Goals: Increasing access, ensuring quality of care, sustainability of system
• Universal access
• Choice of provider
• Broad set of benefits
• Mix of public and private funding
• Economic efficiency of delivery comparable to other European nations
• Regulated at national level
• Preventive care and health promotion delivered at regional and community levels

Structure

The Belgian health care system is organized around a "principle of solidarity" that recognizes no distinction between rich and poor, healthy and sick, with no selection of risk. Based on the Bismarck concept of social insurance, the system covers more than 99% of the Belgian population with more than 8000 services. Treatment decisions are made by doctor and patient, and patients are free to choose their own doctor. 

Health policy decisions are split between Belgium's federal government, regions, and communities. The national government regulates and finances the system; among other responsibilities, regions and communities deliver public and preventive health and coordinate primary and palliative care.

Financing

Financing occurs through a combination of progressive taxation, social security taxes, a consumption tax, and out-of-pocket payments (20%). Six private, noncommercial sickness funds provide compulsory health insurance to all Belgians regardless of economic status, medical condition, or risk; a federal agency supplies a budget to the sickness funds. Patients make a co-pay to physicians or hospitals, which bill the sickness fund for the remainder. Occasionally, patients make an out-of-pocket payment.

Delivery
Although primary care is typically the first point of contact for a patient and the health care system, there is no formal referral system. Thus for many patients, the specialist is the initial contact. Ambulatory care practices are private and paid via fee-for-service.

Belgium offers two forms of hospitalization: general (acute, specialty, and geriatric) and psychiatric. Alternatives include day hospitals and long-term care facilities, as well as community services of the elderly and the mentally ill.

While communities have responsibility for most public health services, including education and preventive care, they have on occasion collaborated with the federal government to coordinate and finance public health activities such as immunization and breast cancer screening.

Generally, the federal government sets policy and sets targeted taxes. For example, Belgian taxes on cigarettes and alcohol are designed at the federal level to discourage consumption. However, Belgium's Flemish, French, and German communities establish policies for their particular health needs.

Challenges

Belgium's health care challenges are familiar: The elder population will double over the next 25 years, creating budgetary and capacity difficulties. Moreover, aggregate costs will rise as medical inflation continues to outstrip general inflation. As a result, the federal government and the community government will struggle to meet the commitments to access, quality, and sustainability. 

Overall

According to the Brookings Institution,

Devoting only half as much of its GDP to health as the United States does, Belgium has created a flexible, public-private partnership to pay for and deliver health care that preserves many of the attributes that Americans desire: universal coverage; comprehensive coverage of physician services, hospital care, and prescription drugs; free choice of primary physicians and specialists; and acceptable waiting periods for non-emergency services.

WHO Ranking  21 (US 37)

To read more about Belgium's health care system, click here and here.

To Live Longer: Don't Smoke, Eat Less, Exercise More

According to a National Research Council report, Explaining Divergent Levels of Longevity in High-Income Countries, life expectancy in the United States continues to increase, but at a slower rate than in the past. The most likely culprits are smoking and obesity; the latter may account from 1/5 to 1/3 of the reduced rate. According to the CIA World Factbook, the United States currently ranks 49th in the world in life expectancy. (Monaco, at nearly 90, is first.)

To learn more about life expectancy, click here.

In another study, Circulation: Journal of the American Heart Association reports that the costs of heart disease are expected to triple over the next twenty years. Combined costs in dollars and lost productivity are expect to rise from $445B today to $1.094T.

Principles of Efficiency

So why is it that other countries deliver health care with greater economic efficiency than the United States?

For starters, it would be hard not to: The United States doesn't really have a health care system. It's a more like a fragmented, uncoordinated apparatus linked by a loose and often contradictory regulatory framework and characterized by both overtreatment and undertreatment. An onerous administrative burden, health care driven by profit and not value, and the absence of several vital traits of an economically efficient system combine to give the United States the most expensive health care in the world, although by no means the best.

What are some of those key traits? Let's look briefly at two systems that are efficient, despite diametrically opposed approaches to universal access. The health care system of Finland (%GDP on health care of 8.5%, HCE of 7.6) is government-owned and -operated -- classic Beveridge Model socialized medicine. Singapore (%GDP on health of 3.4%, HCE of 21.5) is a public-private partnership funded by a combination of government subsidies, a limited NHI scheme, mandatory Health Savings Accounts, and out-of-pocket payments. Nonetheless, these two disparate systems have much in common:

• a national health policy formed by a democratic process and directed by the national government
• a commitment to universal access and care, regardless of ability to pay
• an emphasis on preventive health based on primary care and public education
• a strong government regulatory presence
• targeted policies and incentives aimed at bolstering efficiency within the model (Finland, for example, has a pharmaceutical policy that rewards use of generic drugs.)

As we'll see again and again, these are vital elements in the successful delivery of health care based on value, a results-driven approach that Michael Porter and Elizabeth Olmstead Teisberg, in their influential book, Redefining Health Care: Creating Value-Based Competition Based on Results, that produces both quality and efficiency. (Click here to for Porter and Teisberg's excellent web site.)

So, it turns out that the road to efficiency is straight enough. Obviously, negotiating the obstacles of special interests along the way is another story. 

HealthMatters will discuss each of these conditions in detail in later entries.