First Up -- The Audacity of Hopelessness

March 8, 2010
Do our political leaders have the resolve to steer us from an unsustainable path?

In just over a year, we've seen America's headlines flip from hope to anger, from Obama posters to Tea Party signs. The massive recession, the ensuing government spending on odious bailouts for a reckless financial industry, astronomical national debt and the lingering high rates of unemployment have helped fuel this anger. Also contributing mightily to this anger and frustration is the health care reform spectacle. For anyone distrustful of government, the so-called health care reform debate (more resembling World War I trench warfare) has provided ample reinforcement for the belief that government, no matter what the question, is not the answer. Give the lion's share of credit to Congress for proudly exhibiting the audacity of hopelessness -- a willingness not to tackle and resolve our most pressing national problems.

But before we give our federal government another pass on solving a growing crisis, let's remember what's at stake in the health care miasma. The United States spends an estimated $2.6 trillion a year on health care. We spend more per capita than any other nation and our rate of growth in health care spending is one of the highest. For the government, warns the Congressional Budget Office, "rising costs for health care will cause federal spending to grow much faster than the economy, putting the federal budget on an unsustainable path."

In a briefing paper, the Kaiser Family Foundation noted that employer-sponsored health coverage premiums have increased by 119% since 1999, burdening both employers and employees. In a September 2009 report prepared by Hewitt Associates for the Business Roundtable, researchers warned that if present trends continue, the cost to provide an employee with health care will rise from $10,000 to $28,000 over the next 10 years.

Despite all this spending, 46 million Americans have no health insurance. According to an estimate by the Center for American Progress, 2.4 million workers lost their employer-based health coverage since the start of the recession. Of that, durable goods manufacturing accounted for 733,600 workers becoming uninsured.

What's the icing on this sour cake? The World Health Report 2000 ranked the U.S. health care system 37th in the world. While we have the opportunity in this country to access the best possible medical care, our fragmented system doesn't deliver that type of health care consistently to the U.S. population and our outcomes for measures such as infant mortality and life expectancy reflect it.

Writing for the New England Journal of Medicine, Gail Wilensky succinctly noted: "The issues that drove health care reform -- unsustainable increases in health care spending, unacceptable levels of patient safety and delivery of clinically appropriate care, and 15% of the population without insurance coverage -- will not disappear just because there's a political impasse. So as frustrating as legislators found the experience of 2009, they will still need to find ways to make progress on these issues."

Underscoring the need for action now is an analysis by Karen Davis and Kristof Stremikis for the Commonwealth Fund, a private foundation focusing on health care issues. They looked at proposals by Presidents Nixon, Carter and Clinton to expand health care coverage and control costs. For example, Nixon's Comprehensive Health Insurance Plan would have mandated private insurance coverage for employees and their families in businesses with 25 or more employees, provided public coverage for low-income families and replaced Medicare with a stronger federal health insurance program. If that plan had been enacted in 1975 and reduced the annual increase in spending by 1.5% a year, health care would cost $1 trillion less this year.

I'm not a health policy expert, despite my recent stay at a Holiday Inn Express, but I do know that U.S. businesses and workers can't afford to be competitive if they continue to be weighed down by out-of-control health care costs. Preliminary results of a CEO survey by Deloitte and the Council on Competitiveness show they believe U.S. competitiveness is declining and that the United States will rank only fifth in the world in five years, with a significant advantage given to China and India. Health care is part of a broad range of issues that negatively impact U.S. competitiveness. No health care reform bill passed this year will be perfect, but failing to act at all could be perfectly disastrous.

Steve Minter is IW's chief editor. He is based in Cleveland.

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!