The Colombian reform of 1994, through a strange historical sequence, became a model for health reform in Latin America, Europe, and the United States. Officially, the reform aimed to improve access for the uninsured and underinsured, in collaboration with the private, for-profit insurance industry. After several historical attempts at health reform adhering to the neoliberal pattern, favored by international financial institutions and multinational insurance corporations, the Affordable Care Act (ACA) similarly enhanced access by corporations to public-sector trust funds. An ideology favoring for-profit corporations in the marketplace justified these reforms through unproven claims about the efficiency of the private sector and enhanced quality of care under principles of competition and business management. The ACA maintains this historical continuity by dealing with health care as a commodity bought and sold in a marketplace, rather than a fundamental human right to be guaranteed according to principles of social solidarity. As the ACA heads toward probable failure, a space finally will open for a U.S. national health program that does not follow same historical patterns of the neoliberal model.
Despite a massive expansion of Medicaid and an upswing in the economy, the total number of Americans uninsured in 1993 was 39.7 million, more than at any time since the passage of Medicaid and Medicare in the 1960s. Since 1989, the ranks of the uninsured have swelled by 6.3 million. Millions more would be uninsured if Medicaid enrollment had not risen dramatically, by 10.5 million people since 1989. Loss of health coverage is a growing problem for middle-income families, women, and children, as it has long been for low-income families. Even in Hawaii, whose employer mandate program is often cited as a model of universal coverage, there was a large increase in uninsurance. Nationwide, the sharp upswing in the number of Americans who are uninsured has coincided with government and corporate policies to encourage medical competition and push people into managed care plans. Republican proposals to limit AFDC benefits threaten to further increase uninsurance, particularly among women and children. Only a Canadian-style single-payer reform can assure universal coverage and simultaneously contain costs.
This report provides data on the state of U.S. health care at the start of the new century. It reveals increasing numbers of uninsured and underinsured Americans; increasing costs for health insurance, health care services, and medicines; and increasing inequalities in health and in access to health care. The author also provides data on the current state of the pharmaceutical and health service industries, including Medicaid and Medicare HMOs. The results of some opinion polls on health care, conducted among physicians and the general public, are also summarized.
Previous research has documented Medicare overpayments to the private Medicare Advantage (MA) plans that compete with traditional fee-for-service Medicare. This research has assessed individual categories of overpayment for, at most, a few years. However, no study has calculated the total overpayments to private plans since the program's inception. Prior to 2004, selective enrollment of healthier seniors was the major source of excess payments. We estimate this has added US$41 billion to Medicare's costs since 1985. Medicare adopted a risk-adjustment scheme in 2004, but this has not curbed private plans' ability to game the payment system. This has added US$122.5 billion to Medicare's costs since 2004. Congress mandated increased payment to private plans in the 2003 Medicare Modernization Act, which was mitigated, to a degree, by the subsequent Affordable Care Act. In total, we find that Medicare has overpaid private insurers by US$282.6 billion since 1985. Risk adjustment does not work in for-profit MA plans, which have a financial incentive, the data, and the ingenuity to game whatever system Medicare devises. It is time to end Medicare's costly experiment with privatization. The U.S. needs to adopt a single-payer national health insurance program with effective methods for controlling costs.
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