Our current medical system is a dysfunctional, adversarial, co-dependent scrum of insurance companies, practitioners, patients and the government. At the heart of the scrum is money. There are three basic issues: (1) waste, in the form of fraud, and unnecessary treatment;(2) insufficient preventa-tive or appropriate care, which leads to large increases in healthcare cost when complications or disease set in;and (3) insurance, which can limit care. Each of these areas directly impacts the others, causing a cycle of increased cost that is passed on to consumers. However, the most difficult problem to resolve has been insurance. It is the hub of all medical costs in the US and is also the lynchpin of the political fight, where different philosophies clash: one pro-business, the other pro-access and care.

It is easy to get lost in the maze of regulations and laws that affect the insurance game, but it all boils down to ideas of social insurance and limited insurance. Most western countries, including the US, have been based on a social insur ance policy where everyone pays about the same for healthcare, regardless of their health status. For example, a twenty-something health nut who hasn't seen a doctor in years pays the same as a fifty-something suffering from heart disease, diabetes and gout who sees the doctor on a regular basis and takes a library of prescription medicines. The system is set up to ensure that healthier people in essence wind up paying for the insurance of sick people, but are assured that if their health is compromised, they will have access to healthcare. This system of social distribution of cost works well everywhere but here, because it has slowly been infected by a newer philosophy where your insurance rate depends upon your use of the system.

This is in fact the second pro-business philosophy that has taken hold of the healthcare industry through changes in insurance policy. The root of it is a concept called 'moral hazard', which states that access to healthcare unnecessarily increases the use of healthcare;i.e. if it's free and cheap then people will overdo it. The principle is overly simplistic though. It presumes that people like to go to the doctor, which we all know is untrue. Rich people don't go to the doctor more than people with normal health insurance and people in government-subsidized healthcare plans like Medicaid and Medicare do not use the healthcare system more than people of equal health who have the best insurance money can buy - plain and simple.

Nonetheless, insurance companies, which continue to make record profits, have been freely reducing access to healthcare procedures and medication, which increases their bottom line. They then increase the rates for employers whose workers incur high healthcare costs due to severe illness, thus treating healthcare in much the way that we treat car insurance. If you are a bad driver, you pay higher insurance than people who are good drivers. But healthcare is not the same as driving cars. Sure, most people who are in bad health are so because of their own behavior, but not every one. The system punishes bad health by raising the cost of health insurance for these people. Here is where the feedback starts: if you limit care or raise costs, people are less likely to go to the doctor when they feel ill or 'choose' not to have insurance. It is absolutely accepted in the medical field that the most expensive procedures, including hospital stays, increase in frequency as a function of neglect of health, especially through not getting adequate care early on.

The moral hazard philosophy is, not surprisingly, the center of healthcare reform today. President Bush is pushing his version of'moral hazard' in the form of Health Savings Accounts, where people pay for their own basic healthcare through taxfree accounts. They obtain coverage for serious health matters through private insurance plans that have big tax advantages. So people in relatively good health will choose cheaper, stripped down plans that offer fewer services, and people in bad health will be forced to pay more for their care. This is a dangerous place to be, because if a healthy person gets severely sick and needs services outside of their insurance coverage, it comes out of their own pocket. It completely ignores the fact that the most common reason for bankruptcy in the US is health-related bills, and will most certainly add to the problem.

So, what is driving this trend? Some say it is flat-out greed, but there are those who legitimately feel that this is the most sensible way to reduce healthcare costs. They even roll out studies to prove it, but these economic studies are nothing more than bad logic, false presumption and a fundamental lack of understanding of why people seek medical care. At the center is the so-called 'evidence' that moral hazard applies to healthcare. For example, the Bush administration frequently cites the 2004 Economic Report of the President when talking about healthcare. The report claims that the reason for the rise in healthcare cost is over-consumption, and details the fact that people really don't want health insurance (no, I am not kidding). It claims that one fourth of the people who do not have health insurance had it available to them through an employer and chose not to be covered. It also claims that many of the uninsured were young healthy people who just didn't want coverage. They also talk about people being eligible for Medicaid but not applying, and about others being foreigners working here who have coverage outside of the US.

Extrapolating, the report is implying that a high percentage of the 45 million people without health insurance just don't want it. It fails to recognize that the insurance that these people are turning down is often too expensive for them, and that given the choice between paying their electricity and food bills and having health insurance, these people eat and have electricicity. Fifty-six per cent of the people who don't have health insurance are families with at least one full-time worker. Only 19% of the uninsured are not in families where no one is working. So the report is right in one sense - they did 'choose' not to enroll in available insurance - but they are doing so for the same reason I don't own a Ferrari. Never mind the fact that half of people without health insurance owe money to hospitals and that fifteen million Americans without health insurance are now being chased by collection agencies.

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