Q&A: Why don't hospitals display rates?

Q: How accurate or inaccurate is Michael Moore's assertion that the Canadian, French and British health care systems are better than the U.S. system?

— Melvin Pitts, San Antonio, Texas

Answered by economist Karen Davis, president of The Commonwealth Fund

A: International health system comparisons by The Commonwealth Fund, the Organization for Economic Cooperation and Development (OECD), and the World Health Organization (WHO), do support the assertion that the U.S. health system does not perform well compared to other industrialized nations in many areas.

While research shows there is room for improvement in every country, in Commonwealth Fund surveys the U.S. comes in last overall in five key areas of health care — access, quality, equity, efficiency, healthy lives — compared with five other countries (Australia, Canada, Germany, New Zealand, and the U.K.). 

And the Fund’s National Scorecard on U.S. Health System Performance shows that the U.S. falls short in several areas:

• The U.S. ranks 15th out of 19 countries on mortality from conditions “amenable to health care” — that is, deaths that could have been prevented with timely and effective care.
• Out of 23 countries, the U.S. ranked last on infant mortality, with a rate of 7 infant deaths per 1,000 births, more than double the rates of the top three countries.
• Forty percent of U.S. adults and 57 percent of adults with below-average incomes reported in 2004 that they went without care during the year because of the cost — four times higher than in the U.K.
• The U.S. spends the most on administrative costs:  7.3 percent of national health expenditures, compared with 1 percent in France, 2.6 percent in Canada, and 3.3 percent in the U.K.

The news is not all bad, however — in our surveys the U.S. did do best on preventive care and waiting times for surgery and specialized care. And improvement is possible, with national leadership and commitment to a high performance health system.

The bottom line is, considering that the U.S. spends far more than any country on health care, we do not get good value for our health care dollar.

*****

Q: What are people who are refused health insurance because of age and pre-existing health concerns but do not qualify for disability supposed to do? Is it legal for companies to refuse to sell someone health insurance?

— Liz Woodland, Las Vegas

Q: I'd be interested in knowing how insurance companies are legally able to discriminate on who they choose to insure on the basis of age. I thought discrimination in this country was illegal. However, insurance companies do this all the time.

—  Jean Stolsmark, Gold Canyon, Ariz.

Related questions answered by attorney and psychologist David L. Trueman:

A: These are two interlocking questions. The answers to both questions relate to the fact that health insurance in the United States is provided by private companies that consider profit in what they provide to the public. Although companies cannot discriminate against people based on certain characteristics such as race, gender and national origin, insurance companies can — and do — discriminate based on medical condition. As a matter of fact, that is the very basis for how health insurance is provided.

Insurance is the passing of risk from one person or entity to another. The idea behind all insurance — health care or other insurance — is that a person who is not willing to accept the risk of a large loss is willing to pay a small premium periodically to a company that is willing to assume that risk. Insurance companies are willing to make the trade because if they have a have a high enough volume of customers, they can predict how much it will cost to pay claims, and then charge high enough premiums that allow them to make a profit. The bigger the group, the more easily an insurance company can determine the risk of paying claims. 

However, an insurance company will have a more difficult time determining how much it will have to pay for an individual’s health care.  When one person with a pre-existing condition seeks insurance, the company will likely have to pay a considerable amount of money in health expenses.  If the person is part of the group, then the cost can easily be lumped with the rest of the group’s payments for health expenses, and the overall premium will ensure a profit.  However, for an individual, the insurer may well be paying far more than the premiums it is receiving.  Thus, insurers are reluctant to provide individual health care policies.

In some states, insurers are allowed to refuse health coverage for people with pre-existing conditions. In others, governments have mandated that insurers will have to offer coverage to those with pre-existing conditions within a certain period of time.  However, there is no guarantee that the coverage will be affordable. 

If you think that you are being discriminated against, you should go to your state’s insurance commission to check to see whether what the company is doing is legal. If it is, you may not be able to get insurance. That is one of the consequences of living in a country that doesn’t require universal health insurance.

There are limited subsidies for people who cannot afford health care insurance.  Although we provide health care coverage for the very poor through programs like Medicaid and the Children’s Health Insurance Program, almost 20 percent of the population lack health insurance and remain uninsured.

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