A Prescription for
Health Care Reform
Donald P. Condit
Edited by Kevin Schmiesing
Christian Social Thought Series, Number 14
Copyright © 2009 by Acton Institute
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III. Catholic Social Teaching and Health Care
IV. Evolution of the American Health System
V. A Second Opinion on Employer Responsibility for Health Care
VI. What’s the Matter with Socialized Medicine?
VII. A Christian Prescription for Health Care Reform
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Provision of health care has ever been an integral part of the Christian mission. From the early centuries of the Church, followers of Jesus sought to reflect the kind of charity that he demanded in the parable of the Good Samaritan. “Visit the sick” became one of the customary works of mercy, a set of practices to guide Christians in living out the faith to which they adhered. Congregations of religious men and women under the leadership of saints such as Camillus de Lellis and Louise de Marillac have been major—sometimes primary—suppliers of medical assistance, palliative care, and spiritual succor to the ill since the Middle Ages.
Given this history, Christians ponder health care delivery in the twenty-first century from a position of long experience. Yet the advance of technology, changing societal mores, and economic development create new contexts in which to apply the venerable principles of the gospel message.
Donald Condit, a practicing physician, brings together careful reflection on Catholic social teaching, a mass of empirical data, and his firsthand experience of medicine in this outstanding treatment of health care from a Christian perspective. Although this monograph focuses on the situation in the United States, parts of the analysis will be relevant to other national contexts. Many of the questions are universal: Which principles of social doctrine are pertinent to health care? How can health care be made accessible to all without ceding control to central authorities? How can the rapidly rising costs of care be curbed? Which kind of medical system will most consistently reflect the central directive of the Church’s social teaching: honor the human dignity of every person?
These are daunting questions that Dr. Condit approaches with circumspection. Failing to answer them to the best of our ability, however, is not a viable option for responsible citizens. Dr. Condit furnishes informed and intelligent guidance for those trying to understand the problems troubling health care provision and searching for ways to address them.
—Kevin Schmiesing, Acton Institute
I
“Every generation has the task of engaging anew in the arduous search for the right way to order human affairs.”
-Pope Benedict XVI, Spe Salvi, no. 25
The ethical allocation of health care resources is an exigency of our time. As the third millennium begins, “new things” contributing to injustice in United States health care include technologic advance, the demographic “silver tsunami,” and the globalization of business. Forty-six million uninsured, and millions more precariously insured, serve as witness to a dysfunctional system. Dissatisfaction propagates among patients, providers, employers, and taxpayers as costs continue to escalate. Medical spending in the United States was $2.2 trillion and constituted more than 16 percent of gross domestic product (GDP) in 2007. In ten years it is expected to exceed $4 trillion and comprise nearly 20 percent of GDP. The Medicare Trust Fund is expected to be insolvent by 2019. Small businesses are increasingly unable to afford insurance premiums, and health care costs to large businesses undermine their ability to compete in the global marketplace. In certain fields, and in some locales, physician shortages are compromising communities’ health care. The poor and vulnerable, who deserve special attention from Christians, can expect greater difficulty accessing medical care without significant change in our health care system.
How ought those committed to the common good proceed?
Well-intentioned leaders seeking to improve the health care situation in the United States often advocate “comprehensive” or “universal” reform which, in reality, calls for more government involvement in health care. However, the present extent of government involvement in health care has been weighed and found wanting. Over 50 percent of health care is currently government funded, and spending is increasing exponentially. Moreover, 86 percent of medical spending is by a third party, that is, by someone other than the consumer of those services, yet much of health care spending is the result of factors under individual control. Chronic diseases, which account for 75 percent of health care expenditures, are influenced by modifiable risk factors. Smoking, diet, physical inactivity, and alcohol use account for 38 percent of all United States deaths. The National Center of Health reports that two-thirds of American adults are currently obese or overweight.
More critically, our three branches of government have failed to protect the universal and inviolable rights deserved by human beings, created imago Dei, from conception to natural death. Early in his administration, President Obama has authorized the use of tax dollars to fund abortion-providing organizations in other countries and to pay for research that destroys human embryos. In this climate, is it prudent for men and women of good will to advocate for more government responsibility? “The common outcry,” Pope John Paul II wrote in 1988, “which is justly made on behalf of human rights—for example, the right to health, to home, to work, to family, to culture—is false and illusory if the right to life, the most basic and fundamental right and the condition for all other personal rights, is not defended with maximum determination” (Christifideles Laici, no. 38). More recently, the Congregation for the Doctrine of the Faith has reiterated forcefully, “The dignity of a person must be recognized in every human being from conception to natural death” (Dignitas Personae, no. 1).
If government cannot be trusted to handle health care in a morally sensible way, what then? Any suggestion that the sick, injured, poor, and vulnerable can meet the prerequisites for a market transaction that does not fail social justice deserves serious scrutiny. Prerequisites for genuine market transactions include adequate information, absence of duress, consumer choice, and competition. These elements are frequently compromised in health care encounters. Nonetheless, “A truly competitive market is an effective instrument for attaining important objectives of justice” (Compendium of the Social Doctrine of the Church, no. 347). The challenge, it seems, is to create a workable health care market and enable all to participate in it equitably.
This monograph seeks to promote understanding and deliberation concerning the critical circumstances of health care in the United States. While its focus is the United States, various pieces of the analysis can be applied to other countries. Furthermore, it discusses more socialized health care systems in comparison. Our intention is to improve the health status of the poor and vulnerable, paying special attention to the benchmark of human dignity, while fostering innovation in medical care. We suggest that morally guided and market oriented reform is more just and sustainable than increasing government responsibility for health care. In this proposal, we seek to apply the principles of a Christian social ethic to the circumstances of our time. We recognize that there are other approaches to the problem, and that others may reach other conclusions based on sincere attempts to make the same application. “The moral imperative to respond to the needs of our neighbors—basic needs such as food, shelter, health care, education, and meaningful work—is universally binding on our consciences,” the United States bishops have insisted, but this imperative, they continue, “may be legitimately fulfilled by a variety of means.”
We begin with a consideration of the unsustainable and unjust nature of current conditions. A discussion of Catholic social teaching and its relevance for health care reform follows. A historical review of the evolution of health care in the United States provides insight into our dysfunctional circumstances. The two succeeding chapters examine the deficiencies in the existing employer-based system and the movement toward more socialized health care. Finally, we offer a prescription for reform based on the inherent dignity of the human person.
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II
“By intervening directly and depriving society of its responsibility, the social assistance state leads to a loss of human energies and an inordinate increase of public agencies, which are dominated more by bureaucratic ways of thinking than by concern for serving their clients, and which are accompanied by an enormous increase in spending.”
-Pope John Paul II, Centesimus Annus, no. 48
That is Health care is in critical condition, whether considered from the perspective of the poor and vulnerable, employers, providers, or society at large.
The American Medical Association’s health care reform campaign tag line, “one out of six is 47 million too many,” emphasizes the plight of those without health insurance. The uninsured have difficulty gaining access to health care and suffer from delayed treatment and nontreatment of acute and chronic disease. Thousands more Americans are an illness or pink slip away from losing health insurance provided by employers. Approximately 60 percent of workers rely on this benefit. Also precariously insured are those small business employees and owners who face ever increasing premium costs with after-tax dollars. Medical bankruptcy claims bear witness to the potentially devastating nature of unexpected medical bills. In a 2001 report, approximately half of American families filing for bankruptcy cited medical bills as contributory. Middle and lower income workers who do have health coverage but can barely afford it are particularly vulnerable. State-imposed insurance coverage mandates often drive insurance costs up by including benefits that might not otherwise be selected by an individual or family directly purchasing insurance. For example, chiropractic, pregnancy, neonatal, or infertility coverage might increase the premium price beyond affordability for some not interested in these options. Similarly, guaranteed issue requirements might increase insurance costs for a healthy nonsmoker such that they choose to take the risk of going uncovered.
Individuals and employers face ever-increasing premiums for health insurance. The Kaiser Family Foundation found the average employer annual total premium cost to be $4,704 for single coverage and $12,680 for family coverage in 2008. Health spending in the United States averaged $7,421 per person in 2007. American employers cite rising health care costs as a reason they move factories abroad or are unable to compete. Employers have seen premiums increase four times the rate of inflation between 2000 and 2007. In 2006, Ford had a $3.5 billion health care liability, with a $1,100 per vehicle health care cost. In contrast, Japanese manufacturers spent $450 per car on health care for vehicles made in the United States. General Motors spent $1,525 for every United States-built vehicle compared to Toyota spending $97 per vehicle in Japan in 2005.
Reflecting the challenges of competing in the global marketplace, where competitors are not burdened with employee health responsibility, fewer employers offer medical benefits. From 2000 to 2007, the percentage of total employers offering health care benefits decreased from 69 to 60. Firms attempt to control escalating medical expenses with workplace wellness programs. These efforts potentially distract businesses from their primary tasks of improving their provision of goods and services and providing employment. Critics of this trend also warn of potential conflicts arising from employers’ involvement in employee health issues, citing privacy and discrimination concerns.
Employee health care responsibilities tend to differ across industries and between states. For example, manufacturing firms often provide health care benefits while agriculture and food service concerns do not. In addition, the list of required medical benefits varies considerably from state to state. The Council for Affordable Health Insurance has identified more than 1900 mandates that contribute to interstate variation in medical spending. In some states, health care benefits include chiropractor, podiatrist, midwife, or naturopath care. Maryland law requires large retailers to cover employee health care. In Vermont, a May 2006 health reform package penalized employers that do not provide health insurance. Massachusetts has adopted state-wide mandatory health care for all residents and is struggling to pay for its promises. There are provisions to penalize employers who do not provide coverage.
Meanwhile, tax laws subsidizing employer-provided health care benefits effectively punish taxpaying citizens who purchase health care benefits with after-tax dollars. All taxpayers essentially subsidize the employers who offer, and employees who receive, pretax health care benefits. This subsidy, or foregone federal tax revenue, for employer-based health care benefits was estimated as high as $200 billion in 2006 and reported to have been $246 billion in 2007. Those in higher tax brackets realize greater gains from receiving pretax benefits. Someone without tax-free health care benefits who is paying out of pocket for health care does not participate in this tax break. “Concern for uninsured,” one analysis notes, “obscures the plight of middle- and lower-income workers who do have health coverage but pay dearly for it.”
The United States government finances over 50 percent of health care spending. This includes Medicare programs for those over sixty-five years of age; Medicaid for the poor and disabled; children through the State Children’s Health Insurance Program (SCHIP); veterans through the Department of Veterans Affairs (VA); and government employees, including elected officials and retirees. If this calculation included the tax subsidy for employer-based health care, public sector spending would be even higher. The Centers for Medicare and Medicaid Services reported medical spending constituted more than 16 percent of GDP in 2007 and in ten years is expected to exceed $4 trillion and comprise nearly 20 percent of GDP. The Medicare Trust Fund is expected to become insolvent by 2019. A key threshold—when the expected annual payout exceeded receipts from payroll taxes—was reached in 2008. Similarly, the Congressional Budget Office (CBO) reported that the share of national income devoted to health care nearly tripled over the past four decades. The CBO director reported that medical spending in 2009 is expected to total $2.5 trillion. He predicted that there would be 54 million nonelderly people without insurance in a decade. The financial burden future generations will bear, ceteris paribus, without substantial reform, is unconscionable.
Numerous factors contribute to these rising costs and other difficulties within our health care system. Many of the uninsured utilize relatively expensive emergency rooms for medical care, with costs shifting ultimately to taxpayers. Consumers further bear this burden in more expensively priced goods and services. Uninsured people know they will not be turned away from emergency rooms, leading to expensive care that can be more cost effectively provided elsewhere. Furthermore, patients enrolled in Medicaid use the emergency department more frequently than patients with private insurance. The Centers for Disease Control reported 82 visits per 100 persons covered by Medicaid compared with 21 visits per 100 persons with private insurance.
Overburdened emergency facilities face demands distracting them from more critically ill patients. Expensive tests are ordered to protect against lawsuits in the emergency room patient population who can be quick to bring liability claims against medical personnel and hospitals. Waiting times can be considerable, while patients and families suffer in emergency rooms crowded with patients with less severe disorders. Hospitals incur considerable expense in providing emergency care, often without reimbursement. To cover indigent and uninsured care expenses, hospitals and providers shift costs to those who pay. In the long run, consumers pay more for goods and services, which firms must price higher to cover employee health care expenses.
In addition, citizens pay taxes for federal Medicare and state Medicaid programs. However, Medicaid rarely covers the costs of providing care, and neither may Medicare, which further shifts costs to employers and the self-insured. Fox and Pickering estimated the total annual cost shift from Medicare and Medicaid to commercial payers is approximately $88.8 billion in the United States. When confronted with declining reimbursement, physicians facing increasing overhead and liability expenses decrease their availability, and thereby access to health care, for the indigent and uninsured. Only half the nation’s doctors currently accept new Medicaid patients because reimbursement is insufficient to cover the costs of providing care. Charges are higher to those paying their bills. One report found cost shifting adds an extra $274 per person, or $730 per family, to health insurance premiums. Medical outcomes are poorer for those without insurance, independent of controllable risk factors.
Thus, our domestic medical scheme is at a crossroads of increasing demand, unsustainable expense escalation, and social injustice. How ought we proceed? Our search begins with principles of social justice, as articulated in the teaching and tradition of the Catholic Church.
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