To Your Health 

More competition in Utah’s health-care market may help the insured, but it won’t curb costs.

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Health care in the United States is a numbers game. And with every passing year, the numbers get more frightening.

Consider: The middle class is increasingly squeezed out of medical insurance. According to a study by the New York-based Commonwealth Fund, 41 percent of middle-class Americans found themselves without health insurance for at least part of 2005. When you’re without health insurance, it goes without saying that you skip health screenings that might prevent more expensive maladies in the future. Also, according to the same study, 53 percent of all workers earning less than $20,000 went without insurance last year. A recurring statistic ever since about 2003 holds that 28 percent of Americans go without health insurance altogether.

Consider: In 2004, the United States spent 16 percent of its national income on health care, while the “People’s Republic of France,” as conservatives like to call it, spent less than 10 percent of its national income on health care and still managed to provide care for 99 percent of its population.

Prescriptions for this country’s ailing health-care system fill volumes. Conservatives argue Medicare and Medicaid started a dangerous policy of government subsidies in the 1960s that got us where we are today. Ever since government decided employer-based health insurance costs could be deducted from taxable income, health insurance itself has worked in much the same way. When you pay no costs, gone is any incentive to control costs. When was the last time you asked your doctor’s office about the price before making an appointment?

Progressives argue that no civilized society would in principle deny anyone health care based on income alone, and that the private system will eventually collapse. They’ve got a point. Today, it’s estimated that 7 percent of all private insurance premiums go toward footing the medical bills left behind by those too poor to pay them. How many more years can workers forgo pay raises lost to increasing medical costs hoisted on their employers? How long before employers devise ways to screen out prospective hires with potential health problems? Good questions.

So we croak along with a lumbering system where private health insurers and government agencies crash into mountains of paperwork. As New York Times columnist Paul Krugman has pointed out, private health insurers spend considerable money screening out unhealthy applicants, the cost of which they pass on to consumers. Meanwhile, government programs assisting those rejected by private insurers pass these costs on to taxpayers. Only in America do we get the privilege of paying twice, not to mention the joys of worrying ourselves sick over coverage between jobs.

Utah boasts fewer uninsured people than most states, but we’re no exception to this inefficient match of private health insurance and public assistance. We’re home to one of the biggest'perhaps the biggest?'health-care monopolies in the West, Intermountain Health Care. In exchange for its nonprofit status, which exempts it from taxes, it’s supposed to provide health-care services for the disadvantaged. This hardly fills the gap of uninsured met by Medicaid, though. According to an article by The Salt Lake Tribune this February, federal and state taxes combined pay out $1.5 billion to serve this state’s 250,000 Medicaid recipients, many of whom work low-wage jobs.

Sen. Michael Waddoups, R-Taylorsville, and other lawmakers took flack during the 2005 legislative session for calling IHC’s health-care market dominance, and its charitable contributions, into question. To call IHC’s vast health-care products impressive would be an understatement. It owns physician groups, insurance plans and whole hospitals, lining them all up for maximum penetration of Utah’s health-care market. Health-care marketing professionals like to call this model “vertical integration.” Smaller health-care competitors might call it collusion. When lawmakers introduced bills proposing a 3 percent tax on IHC’s annual revenues, and the selling off its health-insurance plans, all hell broke loose.

It didn’t take long for IHC to go on the offensive, introducing signs in doctors’ offices advertising financial assistance for patients of modest means. The qualifications, however, are daunting. Applicants must exhaust virtually every cost option except the lottery before they can qualify, including Medicaid, other state assistance programs such as CHIP, third-party insurance programs, COBRA and church or family assistance. Even so, IHC spokesperson Jason Mathis said that last year IHC wrote off anywhere from 10 to 100 percent of medical expenses in 182,000 cases. Anecdotally, he said, more than 50 percent of those cases constituted a 100 percent write-off. Furthermore, 96 percent of all applicants for IHC financial assistance are approved.

Proof of charitable care is great for public image. What certain lawmakers want, though, is proof of competition in the health-care marketplace. Here to see that the business practices of Utah’s health care providers are kept under close watch is the Privately Owned Health Care Organization Task Force, which Sen. Waddoups co-chairs. In fact, a task-force-commissioned study is due this week.

Even if competition in health-care services becomes guaranteed for the insured, what of the uninsured? Ironically, competition among health-care insurers keeps the uninsured just as they are. After all, profit requires minimizing risks. So insurance companies won’t touch with a 10-foot pole those most in need of health care. So taxpayers will forever fund Medicaid, and medical-care costs continue to rise.

My bet is that once India and China produce physicians of comparable quality to our own, more of us will fly across the Pacific for affordable medical procedures free of insurance-company hassles. Other than that, nothing will change, including the astronomical rise of this country’s health-care costs.

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