Correspondence

The American Health Security Act

N Engl J Med 1993; 329:1357-1358October 28, 1993

Article

To the Editor:

I applaud Senator Paul Wellstone's courage in proposing a sensible and well-thought-out single-payer system to reform health care in the United States. In their article on the American Health Security Act (May 20 issue),1 Wellstone and Shaffer propose to control health care costs by establishing “consumer-oriented managed-care plans” in which “providers could be allowed to keep some portion of budget savings” as an “incentive for efficiency.”

Financial incentives to providers should not be used to control costs. Providers should be encouraged to practice cost-effective medicine through quality-control reviews and other mechanisms. Many managed-care plans work because the “gatekeeper” has a financial incentive not to refer patients to specialists. The American Medical Association says that physician self-referral is unethical except in specific circumstances. Just as it is wrong for physicians to refer for the purpose of making money, it is wrong for them to make money by not referring. In any future health care system, physician referrals should be financially neutral and based solely on the medical needs of the patient.

Wellstone and Shaffer argue that managed-care plans in the proposed single-payer system “would attract members on the basis of the quality of care they offered.” However, complete financial disclosure is frequently not made before enrollment in current managed-care systems. Senator Wellstone's American Health Security Act should mandate full financial disclosure regarding all positive and negative incentives to physicians before people enroll in “consumer-oriented managed-care plans.”

Harry M. Goldin, M.D.
9669 N. Kenton Ave., Skokie, IL 60076

1 References

1. 1

   Wellstone PD, Shaffer ER. The American Health Security Act -- a single-payer proposal. N Engl J Med 1993;328:1489-1493
   Full Text | Web of Science | Medline

To the Editor:

To control costs, Wellstone and Shaffer propose a national health care budget. Their plan fails to account for the projected aging of the population and for society's choice in favor of technological advancement. The authors' simple solution: “rates could be reduced if increased volume threatened to cause a budget shortfall.” Thus, quantity or quality of care would be rationed through government decree, sacrificing incentives for excellence and progress. The notion of reducing administrative costs through a shift from the private to the public sector, with several new layers of bureaucracy, defies prior experience with government enterprise. The Veterans Affairs hospital system is hardly an example of efficiency or excellence.

We agree that conventional fee-for-service care encourages waste through incentives for overuse by both providers and consumers. We disagree that “in every other industrialized nation people are far more satisfied with their health care system.” Year-long queues for needed procedures hardly promote satisfaction. Despite its deficiencies, the health care system in the United States is the envy of the world with regard to research, technology, and education. These areas would suffer dearly under the American Health Security Act.

We do not possess a ready-made alternative to the Wellstone-Shaffer quick fix. Effective solutions, however, should have the following characteristics. First, accountability for the insurance costs must be borne by the vast majority of Americans, as individuals or as private groups, to encourage innovative, cost-efficient, capitated plans as alternatives to fee-for-service care. Tax codes must be constructed to discourage rather than engender waste. Second, universal coverage should be mandated and subsidized, without requiring equivalence of coverage schemes; the latter stifles innovation and leaves national budgeting as the only alternative for cost containment. Third, government and industry should collaborate to create a uniform computerized medical-information network to reduce administrative inefficiencies and facilitate data management. Finally, quality should be regulated through financial incentives for optimal outcomes, rather than by micromanaging physicians.

Marvin A. Konstam, M.D.
Carey D. Kimmelstiel, M.D.
New England Medical Center, Boston, MA 02111

Author/Editor Response

The authors reply:

To the Editor: We agree with Dr. Goldin's suggestion that patients should be aware of physicians' incentives, in both managed-care and alternative arrangements. We believe, however, that the best guarantees of quality are, first, real choice of provider, unencumbered by financial barriers; and second, consumer and provider control over our health care institutions in general and managed-care systems in particular. Beyond these elements, there is considerable debate regarding the best way to make health care delivery both appropriate and efficient. Financial incentives are the bluntest instruments and cannot alone effectively control tendencies to overtreat or undertreat. Utilization review must be carefully designed not to be overly intrusive, provider collaboration must be planned and encouraged, and outcomes research will have to be greatly expanded and sufficiently calibrated to be useful.

With Drs. Konstam and Kimmelstiel, we have less in common. We are willing to grant that our current system, which spends an estimated 25 percent of our now $1 trillion national health budget on administration, does simultaneously fund the most extensive arsenal of high-technology equipment in the world -- the “research, technology, and education” to which Konstam and Kimmelstiel refer. We do not believe that our proposal to convert wasted administrative expense into planned and needed primary care services and coverage for the uninsured would appreciably affect our medical technology. We would further posit that this level of technology does not seem to create satisfaction with our health care system among Americans. Extensive polling data repeatedly show that other nations are far ahead of us on this measure: 91 percent of Canadians think their health care system is better than that in the United States, as compared with 26 percent of Americans who favor the U.S. system1; and a survey of 10 industrialized countries showed that Canadians were the most satisfied with their current health care system, and Americans the least satisfied2. It would seem that residents of these nations prefer access to decent adequate health care that they can afford to technological equipment of questionable usefulness that they cannot.

Finally, Americans already groan under higher out-of-pocket costs for health care than those of any other industrialized nation. We do not agree that increasing this burden would make our system more efficient, a complex task that will require concentrated human intention as much as proper financial incentives.

Senator Paul D. Wellstone (D-Minn.)
Ellen R. Shaffer
Washington, DC 20510

2 References

1. 1

   The U.S.-Canada Gallup poll. August 1, 1991. Princeton, N.J.: Gallup Organization, 1991.
   

2. 2

   Blendon RJ, Leitman R, Morrison I, Donelan K. Satisfaction with health systems in ten nations. Health Aff (Millwood) 1990;9:185-192
   CrossRef | Web of Science | Medline