Is universal health care really anti-capitalist?
Critics and opponents of health care reform and universal health care in the United States frequently make the argument that universal health care is against free-market economic principles and the capitalist ideals on which the American economy is based. But is this actually true? And is the U.S. health care system even a free market in the first place? We asked several experts from across the political and economic spectrum for their take on these questions, and their responses may surprise you.
Bram Kleppner is CEO of Danforth Pewter, a Vermont-based company that manufactures and sells pewter jewelry, holiday ornaments, oil lamps and other products. As CEO of a manufacturing company, Kleppner might seem an unlikely advocate for universal health care, but he says it’s a simple matter of dollars and cents. “I don’t think having a public interstate highway system is anti-capitalist,” he says. “Rather, it provides the infrastructure that allows business to thrive in this country. I feel the same way about universal health care.”
Kleppner has lobbied the Vermont state legislature as well as the press about the need for universal health care so U.S. businesses can continue to compete in the global marketplace. “We [Danforth Pewter] are not health care providers, or health care insurers, or health care administrators. But we and just about every other company in the country waste a lot of time and money doing health care administration.”
Kleppner goes on to say that he believes universal health care is actually pro-business. “When companies don’t have to worry about paying for health care, they can hire when they need to ... and they can lay people off more easily as well,” he says. “It improves the flexibility of the labor market and makes it easier for businesses to match labor to their needs. I think universal health care is very pro-business.”
Manoj Pawar, MD, is Vice President of Clinical Operations and Physician Leadership Development at Catholic Health Initiatives. He agrees with Kleppner’s assertion that universal health care is good for business as well as the public. “I have direct experience with both the U.S. and Canadian health care systems, and my perspective is that we don’t have, and haven’t had, a true free market in health care in the United States,” he says. “We have barriers to competition that don’t exist in other countries. Universal coverage expands the marketplace, and provides opportunities that others don’t necessarily see. From an actuarial perspective as well, there are good reasons for universal care.”
If universal coverage is a good idea — even from a business perspective — then why don’t we have it in the United States? The answer to that is complicated, and has a lot to do with the fact that the U.S. health care system operates in a way that no other industry in this country does.
Sheldon Richman is an economics writer and editor of "The Freeman," a magazine published by the Foundation for Economic Education, one of the nation’s oldest free-market advocacy organizations. While Richman would likely not approve of the creation of a universal single-payer system, he acknowledges that the U.S. health system is not a free market. “The health care system we’ve had in the United States has not represented a free market for a very long time,” he says. “What we really have is not a free market or anything close to it. Rather, we have a cartel.”
How exactly can the U.S. health care system operate like a cartel, you may ask? According to Richman, the answer lies in heavy government regulation of the insurance industry, coupled with powerful special interest groups — such as physicans’ organizations — who along with insurance companies have conspired for generations to strip away competitive market forces to their advantage.
“You have to look below the surface to see that all of these private insurance companies are very heavily embedded in a government system, especially at the state level,” says Richman. “Every state has its own insurance cartel. There’s always been a very cozy relationship between regulators and insurance companies, and that goes a long way to explain why you can’t currently buy health insurance across state lines, which is nonsensical. Believe me, the last thing the health insurance companies want is an open, competitive market.”
According to Richman, the insurance industry is not the only perpetrator of the American health care cartel. “Physicians really have cartelized themselves, too,” he says. “The cartelizing of the physician market dates back to the early 20th century when the American Medical Association (AMA) and other affiliated physician societies went around discrediting medical schools and getting a lot of them — especially those aimed at educating women and minorities — shut down, along with setting up complicated state licensing boards and other regulations. In doing so, they artificially shrank the supply of doctors, which in turn caused prices to skyrocket. The physicians’ organizations also make it their business to lobby legislators against the ability of non-physicians (like nurse practitioners) to provide primary care to patients. The doctors’ organizations publicly say it’s about protecting patients, but it’s really about money.”
Richman asserts that if the health insurance cartels were broken down in favor of a free market, market forces would solve a lot of health care access problems, and he cites historical examples as proof. “In the late 19th and early 20th centuries, a lot of poor and working-class people got their health care from mutual aid societies,” such as the Society of Elks, M.O.O.S.E, and the like, he says. “These societies pooled their members’ resources and used the money to hire staff physicians that cared for their members and families. However, the medical societies worked to discredit these physicians. Which is too bad, because it shows how when people are left to their own devices, they can come up with their own innovative solutions.” Indeed, Richman is encouraged by the current rise in retail health clinics in stores like Walmart and Walgreens — where a nurse practitioner provides basic primary care far more cheaply than a physician can. “I view retail clinics as a good development that arose from market forces,” he says.
Thom Denhalter, RN, MSN, FNP-C, is adjunct nursing faculty at University of Phoenix as well as a nurse practitioner in private practice. While Denhalter concedes that the U.S. health care system is heavily regulated, he does not necessarily view it as a cartel. “Even though there are many regulations on multiple levels of health care, I see it as a free market system with winners and losers,” he says.
As someone who also volunteers at a free clinic for the uninsured in addition to teaching and a private nursing care practice, Denhalter sees first-hand the costs and challenges facing the uninsured “losers” in our current health care system. “I volunteer as a nurse practitioner in a free clinic that has a mission of providing health care to some of the most clinically vulnerable populations in the U.S. — immigrant farm families,” says Denhalter. “These people often do not qualify for public assistance, are generally transient, and their poverty precludes them from paying out of pocket for virtually all health care. In the clinic, we have only the bare essentials of equipment and medications ... sometimes I refer to working at the free clinic as practicing ‘jungle medicine.’”
Denhalter is quite moved by the health and financial situations of patients he encounters at the free clinic. “When I first started volunteering, I was astonished by how ill many of our patients were, and that they were still working [despite those illnesses],” he says. “It is a huge challenge to treat patients with a short-term problem and a multiplicity of chronic untreated diseases.”
Denhalter can relate several anecdotes of the desperate situations facing the indigent patients he treats, but perhaps this one is the most sobering. “One of my patients was a young man who accidently cut himself about two weeks before he came in to the clinic,” he says. “He had a deep, four-inch laceration on his arm. Since his wound was not closed properly, I had to reopen part of his wound that had closed on the surface. He was the primary wage earner in his family, and his ability to work was compromised by a significant wound that he couldn’t afford to have properly sutured.”
Having witnessed the “losers” of the current U.S. health care marketplace first-hand, Denhalter proposes the following solution to our broken system.”If I had the power to change our health care system, I’d revolutionize it, starting with a [universal] single-payer system,” he says. “Big Pharma, big insurers, hospitals, durable medical equipment companies, and care delivery systems would then have to compete for government contracts [like they do in other industries, like defense]. Then stakeholders like legislators, Big Pharma, insurers, and professional associations [i.e., American Medical Association, American Nurses’ Association, etc.], would have equal value and influence.”
While it’s hard to find agreement among experts on how to fix the problem, it seems almost everyone agrees that the current American health care system is not a free market — far from it. Moreover, everyone seems to agree that the American health care system is broken. The only question is, how will we fix it?
