market meditopia a glimpse at american health care in 2005 n.
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Market Meditopia : A Glimpse at American Health Care in 2005. Larry R. Churchhill. Market Meditopia. The made up name “Market Meditopia ” was used in an editorial in the Economist it criticize the U.S. h ealth care system as a market run system.

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market meditopia
Market Meditopia
  • The made up name “Market Meditopia” was used in an editorial in the Economist it criticize the U.S. health care system as a market run system.
  • However, some politician in the U.S. have turned it into a name that refers to something positive, namely, that the market produces the best quality health care system.
  • The view argues that the U.S. health care is the best in the world (utopian) because it is market driven.
corporations running healthcare
Corporations Running Healthcare
  • After the demise of the 1994 Healthcare Reform, the market controlled healthcare in the U.S..
  • The market made it difficult for small insurance companies to succeed.
  • By the year 2000, the healthcare market was monopolized by large manage care systems.
  • They provided everything from birth centers to hospice care.
managed risk and profit
Managed Risk and Profit
  • It is no secret that an insurance company that insures only sick people will go of business very quickly.
  • In fact, to make the most profit possible, the ideal situations for a health insurance company would be to insure only very healthy people.
  • However, this is impossible simply because no one can know the future.
  • However, there are known risk factors and the more and better insurance companies understand these risk factors the more they can avoid them and hence increase the profits they can make.
conflict of interest
Conflict of Interest
  • There appears to be an inherent conflict of interest when we consider the purpose of insurance with the purpose of profit-making corporations.
  • On the one hand, in the case of insurance companies, we have an entity whose purpose is to cover the financial burden of health care treatment for people in case they become ill (Goal 1).
  • On the other hand, in the case of for-profit corporations, we have an entity that strives to make as much profit as it possibly can by cutting its expenses and increasing its revenues (Goal 2).
conflict
Conflict
  • There is an inverse relationship between these goals: The better we do in accomplishing Goal 1, the worse off we are with respect to Goal 2 and vice versa.
  • Objection: It might be argued that a balance could struck, so that we could possibly do some of Goal 1 and some ofGoal 2.
  • What do you think? Can corporate greed be could be controlled and regulated?
problem with market system
Problem with Market System
  • The problem with the market system is that the goals 1 and 2 do not have the same value for a for-profit corporation.
  • Instead, most for-profit corporations consider goal 2 to override goal 1.
  • Corporations have an obligation to their shareholders to maximize profits. Of course, not at all costs; corporation cannot just do anything they want, and they might have higher standards than simply obeying the law.
  • Nevertheless, profit maximization is the primary purpose of a corporation's existence!
insurance companies
Insurance Companies
  • Given what has been argued, it follows that insurance companies will seek out to insure the healthiest portion of society, because ultimately this is the best way to maximize profits– by minimizing their risk.
  • 30% of the population uses 90% of the health services.
  • Therefore, there is an easily identifiable segment of society that insurance companies can avoid to maximize their profits.
genetic testing
Genetic Testing
  • As genetic testing improved, future risk cases for diseases could be identified, thus allowing insurance companies to prepare more sophisticated actuaries to better predict “undesirables” from a cost perspective.
  • The issue of confidentiality for these genetic markers becomes crucial.
pre existing conditions
Pre-existing conditions
  • Pre-existing condition clauses allowed insurance companies to screen out people who were genetically predisposed to certain illnesses.
  • These people became know as Genetically Predisposed Persons orGEPPEs.
consequences
Consequences
  • Rate of increase of uninsured has gone up and continued to do so.
  • The simple fact is that it is not profitable to insure unhealthy people.
slide12

Overall Health Insurance Coverage

  • For calendar year 2011:
  • 55.1% of the population was covered by employer-sponsored insurance
  • 15.2% of the population was covered by Medicare
  • 16.5% of the population was covered by Medicaid
  • 15.7% of the population was uninsured or about 50,000,000 people!

US population in 2010 was 308,000,000

uninsured rate
Uninsured Rate
  • Among Hispanics 30.1%
  • Among Blacks 19.5%
  • Among Asian 16.8%
  • Among non-Hispanic Whites 11.1%
  • See source: http://aspe.hhs.gov/health/reports/2012/uninsuredintheus/ib.shtml
medicaid
Medicaid
  • In 1998 Medicaid funding for uninsured was reduced because it was given over to the states.
  • As a result of this shift, millions of American found themselves no longer covered and uninsured.
the case of the spencer
The Case Of the Spencer
  • Herbert and Jane Spencer lost all of the savings because they had illness and no insurance.
  • The story ran in the NY Times and won a Pulitzer Prize.
  • The US population were scandalized that something like this could happen in the US, and it moved forward the push for Health Care Reform.
health care reform
Health Care Reform
  • Corporate capitalism has had some positive effects on health care.
  • Primarily, its aggressive manage care engendered substantial cost reductions.
  • However, the overall effects of market forces on the health care system raises serious human rights and social justice issues.
current situation
Current Situation
  • Patient Protection and Affordable Care Act 2010
  • The purpose of this new law is to insure more people and make health care more affordable.