Obama’s big test is health

ON Tuesday Barack Obama will take over the White House in similar (if somewhat worse) conditions as the previous time a Democrat took over the White House after a long time of Republican rule.

Sure, then the war in Iraq had been only partially botched and the economy, national debt and the Budget were in poor condition rather than desperate. And terrorism and the weakness of public infrastructure exposed by Hurricane Katrina were less manifest. Nonetheless the similarities are there. The Middle East seemed as intractable then as now.

Bill Clinton got the Budget into surplus and the economy booming. He did much to mend foreign relationships and came within a whisker of a Middle East settlement.

But he failed at one task to which he gave urgent priority: universal health care.

Now, 16 years later, Obama has set himself the same task. It will be his greatest test for several reasons. First, he set himself the task. Secondly, as head of government it should be within his power.

Thirdly, unlike foreign policy and the economy, the task does not have major elements that are beyond the control of the US Government. Clinton could not be blamed for an utterly recalcitrant Yasser Arafat. A US President cannot be blamed for an Asian economic crisis that affects the US.

Fourthly, the US health system inflicts such huge suffering and cost on the American people that not to fix it demonstrates a failure of government. This is why we have government: to prevent suffering and to create cost-effectiveness where the private sector on its own fails.

And fail it has. People regularly die in the US because they have no health insurance and are turned away from treatment. This is not exaggeration. The Journal of the American Medical Association in “Life and Death in the Land of Opportunity” talks about uninsured people going into “a spiral of death” where one failure to treat leads to deterioration which again is not treated and so on. People on death’s door might get treated, but by then it is too late.

The US spends more money on health per head than any other country. In 2008 it spent 15.2 per cent of GDP on health care, or $US7800 per head ($A11,150). (I have used the US dollar amount so as not to blur comparisons with fluctuating exchange rates.) US health spending is growing at a faster rate than its GDP.

There is nothing wrong with spending a lot on health. But only if you get the results. The US, however, is the worst-performing health system among developed countries, according to an article in the British Medical Journal. The World Health Organisation rated its overall level of health at 72 nd in a list of 191 nations.

You can quibble with the methods of these studies, but year after year and study after study shows the US well down the list of health performers, yet it spends the most.

Australia spends nine per cent of GDP on health or $A4507 per head. Even on a one-for-one exchange rate, Australia spends just 60 per cent of what the Americans spend and yet it consistently out-ranks the US in health delivery and results.

Something is obviously not working well in the US and it is fairly obvious what it is: the US is the only developed nation that does not have a publically run or publically subsidised universal health system.

An Australian, Canadian, New Zealander or Brit without insurance gets free or close-to-free health cover, including subsidised pharmaceuticals. They can take out private insurance for quicker or more salubrious attention, but the basics are covered.

In the US without insurance, you have to pay or not get treated. It gets worse. The cost of treatment for the uninsured is higher than the cost charged insurance companies for insured patients because it is used by health providers to cross-subsidise the insured whose companies have screwed down providers with bulk discounts.
The private insurers are under no compulsion to accept anyone. They can exclude from insurance anyone with pre-existing conditions or who fall outside weight, height or age guidelines.

The insurer controls who treats you and where or even if you get treated. The insurers’ medical controllers can deny treatment if they think it is not necessary.

Most insurance is provided through the workplace. Lose your job and lose your insurance. It makes for a compliant workforce.

As a result 45 million Americans are uninsured and the rest are beholden to companies who limit treatment as much as possible. Americans live in fear or getting sick or fear that if sick their insurance company will deny them.
Opinion polls suggest a big majority of Americans want universal health care. So why hasn’t it happened? Greed and ideology.

On the ideology front, many US politicians are implacably opposed to “socialised medicine” as they call it. Public education, defence forces, roads and police do not worry them, but not medicine.

On the greed front, the pharmaceutical industry is the most profitable in the US. Brand name drugs are the most expensive in the world in the US. Health insurance is big business, not a non-profit endeavour. These industries donate to political campaigns and they run fear-based political advertising campaigns at the first smell of reform.
But once a nation has universal health coverage, it is difficult, if not impossible for a political party to undo it – ask John Hewson or John Howard. The people will not stand for it. So Big Health has a lot to lose.

Nonetheless Obama may be just the president to do it, for a couple of reasons. First, he appears to be inspired by values rather than ideology. His admittedly brief legislative record appears to indicate he is more interested in what works rather than taking a dogmatic position based on ideology.

Secondly, and more importantly, he is not beholden to big money. Obama raises most of his money through small donations.

The big problem will be the Congress where so many members on both sides are beholden to the big medical interests. They will be more active than ever. It will be Obama’s biggest test. More Americans have died through lack of medical coverage than through terrorism.