Break the link between employment and healthcare!

Cross-posted from Interrobang:

The US Supreme Court ruled along political lines on the 30th of June, 2014 that “closely held corporations”, over 90% of all US businesses, are now free to discriminate against women (and it was specifically women and birth control) if their religion leads them to believe birth control kills babies, or that women who use birth control are Satan’s spawn (the belief does not have to be factual).

The Supreme Court says corporations can hold religious objections that allow them to opt out of the new health law requirement that they cover contraceptives for women.

The justices’ 5-4 decision Monday is the first time that the high court has ruled that profit-seeking businesses can hold religious views under federal law. And it means the Obama administration must search for a different way of providing free contraception to women who are covered under objecting companies’ health insurance plans.

Salon AP coverage

I am not going to debate the wrongness of this decision, the notion that businesses can have religious beliefs, and can use them to discriminate against certain types of people is not up for debate. And, the discrimination is very specific and targeted…

The other, more ubiquitous discrimination is in the notion that the health care you get has anything to do with the work-for-pay arrangement you have with the organization you work for. I am probably the millionth person to mention this, and whole books have been written on the subject, but, the link between healthcare and your employer is wrong because it anchors discrimination. This particular egregious case goes one step further and discriminates based on gender as well, not just work status.

The US had a chance to sever health benefits from employment when they had a three-year debate on expanding health insurance coverage. Thanks to the ability of small political minorities to filibuster and block action, and a corporate-funded reluctance for change, the US kept their employer-based health insurance system in place, and with it, all the discrimination that entails. Uwe Reinhardt reiterated a number of these points recently in the New York Times.

Back Home

Is BC any better? Yes and no. Thanks to Canada’s Medicare, parts of our health care system are universal and not subject to employment ties. But, there are several exceptions making us a two-tier health care system:

  1. The health insurance tax or MSP (what our government cutely calls a “fee” in order to not call the yearly increase in this fee a tax increase): Many employers will pick up part/all of this tax for their employees, whereas one that doesn’t can pay more than 1000 dollars a year for a family. While there is an element of progressiveness to the pricing with very low-income people paying less/nothing, it is weak, families making > 30K per year pay full price.
  2. Drugs: For some reason, drugs are not covered by our “universal” healthcare system and are provided by workplace “supplemental benefits”, as if taking a thyroid pill every day is a “supplement”. The CCPA makes an excellent case for universal pharmacare, if you need more convincing. 10% of Canadians cannot fill prescriptions for financial reasons.
  3. Our public health insurance system assumes people don’t have eyes or teeth. So, if you want your cavities filled, a root canal, or want to see clearly, you need “supplemental benefits”, and these are mostly employer-provided. Oral health is a clear marker of health inequality.
  4. Mental health is not covered, this is inexcusable, as Andre Picard notes.
  5. Treatments that improve overall health, like massages, are not really covered. Once again, your employment status determines whether you have the “luxury” of holistic preventative measures to reduce stress, pain, and many other issues.
  6. Historically and currently oppressed groups, Canada’s indigenous people for example, get a short shrift on the benefits like massage, nutrition, counselling and holistic treatment they need because of disparity in employment availability.

This quote from the Andre Picard article I mentioned summarizes the discrimination.

The well-to-do pay. The middle-class scrape together the money the best they can, sacrificing so their child can get care. And those without the means wait, or do without care.

There are other side-effects. Because “benefits” are expensive, companies have a vested interest in only having certain “valuable” employees benefit. The rest get treated as contractors, have their hours strategically reduced, and much more.

It’s almost as if there’s an unspoken moral argument here, you don’t deserve good teeth or a massage if you don’t work for a living.

Yes, you can buy individual supplemental insurance, or pay per use, but neither of these are cheap because you as an individual have no bargaining power.

We in BC also have a long way to go to break the link between healthcare and employment. Will it cost the average BC resident more money? Let’s consider:

  1. A simpler system with one buyer is administratively efficient. It takes the thousands of decision points every HR administrator or group in every company/union has to make and transfers that to a single entity. Public universal plans are about four to ten times more efficient (pdf) than fragmented private plans.
  2. A bigger entity can negotiate much better rates for you, whether it is for drugs, or for dentistry, or for anything else (a bigger risk pool). If all of Canada administered one simple pharmacare system, we would negotiate much lower prices with pharmaceutical companies. We would also have better funding to run and evaluate effectiveness studies.
  3. Funding preventative, holistic healthcare means fewer hospital visits. In a universal system, there are no artificial barriers between a massage, drug treatment, surgery, stress reduction counselling, or ergonomic counseling for back pain. You don’t have to prove your work injured you in order to get the right treatment, your first point of contact with a medical professional (not necessarily a doctor) decides which path works best. You do not have to get sick enough to go to the hospital before you get treatment covered by insurance.

Pitfalls

There are concerns with a universal single-payer system:

  1. As Vox points out, if a government administering the single-payer system decides not to pay for contraception, then no one gets it. So, getting good universal healthcare is about constantly winning political battles. The good thing about universal healthcare in Canada is that it is incredibly popular, polling near 90% approval (pdf). So once quality is improved, governments will find it hard to cut back.
  2. Like any other public system, the quality of the institutions drafting policy and administering the system is vitally important. Well run public systems are efficient. But conservative movements in the last 30+ years have worked hard to dismantle the quality of public institutions and trust in such institutions. In this reality of shrinking budgets and staff levels where bureaucrat is a term of insult, ensuring that public system expansion is handled efficiently is no given. There is an entire industry of political parties, think tanks and media devoted to tearing down the concept of a publicly administered good, and ready to pounce on every little misstep (Remember the Obamacare roll out anyone?)
  3. Will employers raise wages from all the savings they get from not providing health benefits, and will these raises cover the increase in taxes we will pay for universal healthcare? Probably not right away, but it will happen eventually.

Transitions

Clearly, we can’t transition tomorrow. A public system would need to be in place and functioning before our employers get out of the health insurance business. I would phase universality in the following order:

  1. Drugs
  2. Teeth and eyes
  3. Preventative and palliative care.

We would also need to rethink the”fee for service”, where healthcare providers are paid per widget, and think about a different system closer to a salaried model, more on that in future blog posts.