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The Great Marginalization

The American Health Care Pyramid

by CARL GINSBURG

The extraordinary creativity and commitment of the US government has given birth finally to what appears to be a new health care financing scheme which, like everything in Obama’s America, harkens back to the age of pyramids. There are hints in the Obama bio that he knew well of things pyramid –- a post-college stint writing financial briefs on such topics as interest-rate swaps; an embrace of behavioral economics while on the faculty of the University of Chicago Law School. The health care plan takes this president’s commitment to hierarchy to new heights, in effect adding several layers to the bottom of the American Health Care Pyramid. As everyone concerned with the runaway costs, profiteering and huge voids in the health care feared, Obama’s failure ab inicio to call for fundamental change in the health care system simply builds pyramids, shifting more money from working people and the poor to the health care sector.

By the recent reckoning of one forthright New York City radiologist, health care in the US today exists on six tiers. Under the new plan, it will increase to ten. Stratification is the name of the game, not just in health care, but in wages, credit access, education: the Great Marginalization on the march.

The same prescription –greater stratification of health care services – has been decried by a number of US physicians more inclined to truthfulness and, well, public health than most. Adding Medicaid recipients and integrating them by income level will lead to the creation of “high-level” Medicaid facilities in middle-income neighborhoods. At three or four times poverty income, these new Medicaid-qualified families will be a bit less unappealing to urban health care providers, whose antipathy for the poor is well known. And there will be “mid-level” Medicaid clinics for the one-to-two times poverty income crowd – as in crowded – and on down. Don’t count on state-of-the-art medicine at any of these clinics, especially as you bottom out at the pyramid’s base. Afterall, had you saved, and planned, and worked harder in school — been more like the Obamas –you would not be at the bottom rung. Or, good care comes to those who’ve cared for themselves. Education starts at home. Savings are possible no matter the wage. Kill more in Afghanistan now to kill less later. Etc., etc.

At no point has President Obama blasted the awful disparity in existing medical services which, with universality and cost control, is a principal argument for single payer. Notice that there is little talk of “good” jobs, not a word about living wages, nothing about working families, displaced people and others catching up, regaining the ground they’ve lost, via a good income. Off the agenda. And not a peep, no reference whatsoever, to the gross disparities in health care quality in the US today.

All attention now is focused on banks paying back their government aid lest they be forced to limit executive pay and lose the good people. Like the good people of Goldman Sachs – which accessed billions of dollars of government money, a fact it likes to play down. But as Bethany McLean reminds us in January’s Vanity Fair,

“Goldman took $10 billion… of TARP… eventually issued $28 billion of [FDIC] debt, close to the limit. As Goldman acknowledged in its public filings, the firm was ‘unable to raise significant amounts of long-term unsecured debt in the public markets, other than as a result of the issuance of securities guaranteed by the FDIC.’”

No guarantees for working Americans, who receive very little from their government: unemployment insurance and food stamps, which add up to a poverty existence. Poverty wages or poverty assistance. And now new levels of poverty health care.

Which takes us back to the pyramid. Top urologists in New York City and other major urban areas pride themselves on NOT accepting any kind of health insurance whatsoever, as do some general surgeons, neurologists and other specialists whose services are reserved for top-of-the-pyramid patients. And why not? It’s a free market… in virtually everything. Nothing being proposed by our government in the health care sphere changes those rules. What’s next? Free markets in kidneys and other organs?

Under newly proposed measures, the estimated cost of Medicare for individuals 55-64 years old would be $7,600 per year, or $633 per month, per person. That would put a recipient on about tier 4 of the pyramid (ten being the top), a level with mediocre services, at best. Who would’ve thought that $633 a month would provide so little?

Washington, D.C.-based health care expert and Medicare author Max Fine wonders why the new Medicare-eligible should be charged so much given how much they’ve already paid into the system for years. Worst, says Fine, is to have a national health insurance program based upon the Federal Employees Health Benefits Program because of its uncontrolled cost structure. What’s more, the new legislation imbeds the insurance industry further in the system, giving insurers 30 million more customers. “It’s not worth doing,” says Fine.

Even those top tiers are bound to thin out. Business Week reports that employers’ health care costs have risen 149 percent since 2000, exceeding $10,000 per employee for the first time this year. The Commonwealth Fund estimates that total premiums for employer-based health insurance will go up 94% by 2020, to almost $2,000 per month per family. For small business and freelancers those huge costs are closer, as Blue Cross/Blue Shield in New York raised premiums 22% this year to about $1,500 per family. Watch your step as you descend the pyramid.

CARL GINSBURG is a Medicare lawyer and journalist based in New York. He can be reached at carlginsburg@gmail.com