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Consumer access to health care: basic right 21st century challenge.


The Uninsured

Thirty-eight million people in the United States have no health care insurance and thus lack access to the most basic right: the right to affordable quality health care. An additional 56 million people are estimated to be underinsured or to lack health care insurance for some period of time in a given year, raising the specter of being without critical health care coverage when it may be most needed. Since 1980, the number of uninsured has risen by one million each year.

Nine million women of childbearing age have no health insurance (Braveman et al. 1989). Twenty-three and 26 percent of black and Hispanic women, respectively, are uninsured. Fifteen percent of the nation's children--9.2 million--have no insurance. Employees of entire industries such as logging, hair stylists, roofing companies, taverns, mining, medical offices, entertainment, and sports are barred from insurance by the industry as high risk occupations.

It is estimated that 20 percent of the American people are either totally without health coverage or lack coverage for some period of time in any given year (The Washington Post 1992). Three-quarters of the uninsured are employed or are dependents of employees. One-half of the working uninsured are employed by small businesses with ten or fewer employees. Many of the uninsured are self-employed, part-time and seasonal workers, or workers whose employers choose not to cover them.

The Underinsured

Even people who have health insurance coverage live in constant fear that when they will need their health insurance it will not cover their particular condition or the deductibles and copayments will be so great that they will not be able to afford the care needed. They are equally fearful that they will lose coverage if their employer or insurance company decides to change or withdraw their coverage, raises premiums, merges with another company, or goes out of business. In a recent poll, 30 percent of employees reported that they were afraid to change jobs for fear of losing their health insurance (The New York Times 1991b). For individuals, typically women and children, whose health insurance coverage is dependent on their working spouse or parent, any change in status--divorce, widowhood, or simply growing up--poses a constant threat to their health care coverage.

Medicare and Medicaid

Efforts by government to supplement the workplace oriented health care system have proved equally inadequate. Even with Medicare, the elderly are paying almost 20 percent of their incomes for medical expenses. The average Medicare household is spending $3,305 on out-of-pocket costs for insurance premiums compared with $1,589 in 1961 (measured in 1991 dollars). A major part of these expenses are for nursing homes. Expenditures on hospitals have declined since 1961 and for physicians have increased only slightly (The Washington Post 1991c). Many elderly cannot afford Medicare's copayments and deductibles. Medicaid covers 37 percent of the poor, down from 65 percent in the past decade ("Who's to Blame" 1991), and health care is available only from those physicians willing to accept Medicaid assignment (The Washington Post 1990). This is proving increasingly difficult for physicians as their reimbursements from Medicaid are substantially lower than for services to their other patients. Moreover, regardless of their incomes Medicaid excludes childless couples and able-bodied, childless, nonpregnant, single adults (EBRI 1990).

Limitations of Benefits

There are other barriers to health care in the United States. Today, most health care insurance is geared to acute illness, essentially covering hospital and skilled nursing care costs and associated physicians' and other health care professionals' fees. There is almost no reimbursement for home care and other outpatient procedures nor for preventive testing and screening. Only 74 percent of physicians' services, 39 percent of dental services, and 25 percent of prescription drugs are covered by health care insurance ("Findings of Pepper Commission" 1989).

Yet, significant numbers of citizens experience chronic health conditions which over the long term do not require hospitalization or acute interventions. Patients are discharged sicker and sooner from hospitals. They require a host of recuperative services most of which are not covered by their health insurance policies. The elderly's need for home care and assistance with normal activities of daily living are similarly not covered. A significant number of the elderly--especially elderly women--are poor, live solely on social security, or have virtually no disposable income. Because women outlive men, are more apt to be in the lower income brackets, and experience a greater share of chronic and disabling illnesses and conditions, older women have special health care concerns and requirements.

Many chronic disorders are the product of lifestyle behaviors which have been largely ignored by our acute care illness oriented system. With the focus on acute care, we have paid little attention to preventive medicine including such things as health care information, wellness programs, nutrition, and general fitness. As a result, too many individuals have not had any, or inadequate access to immunizations, diagnostic tests, home care, hearing and vision care, and pre-natal care.

Finally, the most serious problem underlying our health care system is the runaway costs which the current system generates. United States health care costs (federal and state) increased from $240 billion in 1980 to $817 billion in 1991 (The Washington Post 1991b). The share of health care costs to GNP increased from 5.3 percent in 1960 to 9.1 percent in 1980 to 14 percent in 1991 (The Washington Post 1991b).

Between 1965 and 1987, the cost of benefits to employees rose from two percent of wages to seven percent (Brown 1990). In 1990 individual employee contributions averaged $396 a year up 43.5 percent from 1989, while family payments rose 29 percent to $1,068 a year (The New York Times 1991a). A Henry J. Kaiser Foundation Study estimated that by the end of the decade, an average family's total outlay for health care will jump from its present level of $4,296 to $9,397 (an increase of 118.7 percent) (The Washington Post 1991f). For corporations, health care costs have jumped from 14 percent of after tax profits to 19.4 percent (Brown 1990). Business is estimated to be paying an average of $2,239 per family for health care costs (The Washington Post 1991f).

A major factor in the rising costs of American health care is the administrative costs incurred in the private health insurance segment of the industry. These are passed on to consumers in the premiums they or their corporate employers pay. The American College of Physicians estimates that 20 to 30 percent of our total health care spending ($110 of $600 billion in 1989) can be attributed to administrative costs. These costs, incurred by physicians, hospitals, and nursing homes, are generated by recording, billing, processing, reviewing, and auditing claims and include the costs of marketing health insurance policies, maintaining financial reserves, and providing for corporate profits. States allow medigap insurers to retain a maximum of 40 percent and 25 percent, respectively, of individual and group policy premiums to cover marketing and administrative costs, profits, and past losses (The New York Times 1990).

Hospitals and physicians alike are struggling with an overwhelmingly confusing administrative morass to comply with the record-keeping and reimbursement requirements of 1,500 insurance providers as well as federal and state Medicare and Medicaid authorities. This paperwork for practicing physicians has been estimated as accounting for 40 percent of their gross income or $31 billion in 1983 (American College of Physicians 1990a, 1990b). Hospitals, nursing homes, and employers also maintain a substantial work force of health care administrators which is said to have grown 171 percent between 1970 and 1982. One executive in a small San Francisco hospital estimated that it costs the hospital $7.8 million a year in administrative costs and 140 full-time employees to comply with federal health care regulations (The Wall Street Journal 1990). Moreover, hospitals and physicians struggle to cope with the uncertainty of which of their expenditures will be covered or rejected.

Economic and social impacts of accelerating costs

These escalating health care costs are giving rise to a series of cost containment steps taken by both business and insurance companies which are further adding to both the costs of health care and declines in coverage for individuals. These private sector efforts to constrain health care expenditures have exacerbated current inadequacies of our health care system. In many cases, deductibles are now being assessed both against individual family members and on a per service basis. Lifetime benefit maximums are being added.

Big businesses have instituted managed care programs to control health care costs which have resulted in substantial inroads on consumer's free choice of physicians. Ten years ago, 90 percent of U.S. workers could go to any physician and undergo whatever procedures deemed necessary. Today only 60 percent of workers have these choices and this percentage is expected to decline to 15 percent by the year 2000 (Rock 1991). Large businesses who can afford to do so are becoming self-insurers, thus defeating state risk pools for the uninsured as self-insurers cannot be forced to join these pools (GAO 1989).

Motivated by the competitive market, insurance companies are competing for better risks, offering them lower rates based on actual claims experience rather than community-based averages. Emphasis by insurance companies on competition as a means of reducing costs has caused them to shift from community-based risk assessment policies into more individualized risk assessment policies. Competition among insurance companies today is for the most desirable risks which means the healthiest individuals. This has resulted in substantial cutbacks in eligibility, substantial premium increases for many companies and individuals, and in many cases denials of insurance to whole companies as well as individuals either outright or through increases in premium rates. Consequently, private health insurance plans available to companies differ widely in the comprehensiveness of their benefits, premium costs, and coverage limits (Griss 1989). Small businesses with fewer employees have steadily confronted premiums well above average, far above what they can afford, and substantially higher than those paid by large businesses who can more easily spread their risks over larger employee populations (GAO 1989).

Finally, the variety of coverage among different employment-based health care plans and skyrocketing health care costs are affecting both the productivity of workers as well as their mobility, skewing work forces increasingly toward part-time and temporary workers as a means of cutting industry's health care bills (GAO 1990).

Quality Care Impacts of Inadequate Coverage

The most serious consequence of the lack of adequate health care coverage is its definable and visible adverse effects on accessibility to quality health care (CRS 1988; GAO 1989; Griss 1989). These adverse impacts of health care inadequacies fall disproportionately on special groups, especially low income families and women. In 1986, the poor had 217 percent fewer physician visits than did the nonpoor of the same health status (Freeman et al. 1987). Five million women between the ages of 40 and 65 have no health care coverage. Survey research consistently documents that people without insurance use much less health care than those with comparable health care needs who have insurance. Hospitals report that they are providing increasing volumes of uncompensated care. Yet one million patients are turned away from hospitals each year because of lack of insurance or other means of payment (Himmelstein and Woolhandler 1989). A recent study shows that the uninsured have greater difficulty in seeing doctors or being admitted to hospitals. It also shows that the insurance status of patients makes a profound difference in how well they are treated by doctors after they have been admitted to the hospital (The Washington Post 1991a). The Physicians for a National Health Program have stated that in their judgment, copayments and deductibles endanger the health of the poor, decrease use of vital in-patient medical services, discourage preventive care, and are unwieldy and expensive to administer (Himmelstein and Woolhandler 1989).


The United States pays a high price for its mixed private/public two-tier health care system in respect to both the costs and the quality of its health care. The United States and the Union of South Africa are the only industrial nations that have no universal health care system. Yet U.S. health care costs are the highest in the world.


Comparing the United States with Canada, its neighbor, the United States spent 12 percent of GNP on health care as compared with 8.6 percent for Canada (6.8 and 6.1 percent, respectively, for Japan and Germany). In 1970, the year before Canada adopted its universal single-payer health care system, the United States and Canada each spent roughly 7.4 percent of GNP on health care. By 1989, United States health care expenditures had grown 4.5 percent to 11.6 percent of GNP compared to Canada's 8.9 percent, a growth rate of only 3.7 percent (GAO 1991;(1) Neuschler 1991). Canadian per capita health care costs are 25 percent less than the United States' and since 1971 its physicians' fees have decreased by 18 percent while those in the United States have increased by 22 percent (GAO 1991).

The GAO estimates that the administrative costs paid by the commercial insurance industry in the United States for managers, marketers, lawyers, and other administrators total 33.5 percent ($130 billion) of total health care costs compared with three percent in Canada. It is interesting that United States' Medicare program reflects a similar three percent overhead figure (GAO 1991).

Health Care Outcomes

The United States trains and employs a higher ratio of specialists to primary care physicians than any other country and uses more tests, performs more surgical procedures, and generally treats patients more intensively than other countries (Taylor 1990). Yet, the health care outcomes for Americans are not as impressive as other countries nor are the satisfaction levels of its citizens as high as in Canada for example. The United States ranks 24th among industrial nations in keeping children alive during the first year of life. Only South Africa has a poorer record. In addition, the United States ranks 11th in maternal mortality. Deaths in the United States from heart disease stood at 434 per thousand in 1985 while Canada's rate was 348 (The Washington Post 1989). The United States has the lowest life expectancy among six of the most highly industrialized nations in the world, two and a half to three years shorter than the life expectancies for Canada, Japan, and Sweden. The United States ranks eighth in life expectancy, lower than Cuba. Finally, while Canada averages 85 percent immunization for diphtheria, polio, and measles, the United States only averages 70 percent (Harvard Community Health Plan 1990). The United States ranks 21st in immunization against measles and 100th in immunization against polio (Oregon Health Action Campaign Fact Sheet 1991).

Consumer Satisfaction

Despite the greater expenditures which the United States devotes to health care, its citizens are less satisfied with their health care system than citizens in the top ten industrialized countries. In a 1989 Lou Harris Poll, 89 percent of Americans were displeased with their health care system, saying that it needed "fundamental change or complete rebuilding" (Blendon et al. 1990, 171).


Health care in the United States has been variously viewed as a public good, a reward for meeting certain conditions, and a private right. Thus we have a public health system which rests on the recognition that the prevention of epidemics through the inspection of food, sewage, and water, and more recently, government funding of children's immunizations and AIDS research are matters of public concern and therefore a proper subject of government attention and action. However, for the delivery of health care services to the bulk of our citizens, our approach has been much more pragmatic and market oriented.

Our employment-based health care insurance system has been influenced by the happenstance of Baylor University's need back in 1905 to staunch its deficits from nonpaying patients which led it to launch an experimental health insurance program for Texas school teachers as a way to reimburse their health care costs. It was further solidified by the ad hoc decision of Congress to make payments for health insurance premiums deductible for corporations but not for individuals and by the need of American labor for a collective bargaining agenda. Thus the system of workplace health insurance was born, supplemented by the charity of public hospitals and government reimbursement for special groups such as veterans, the elderly, the disabled, and certain groups of the poor deemed worthy of some health care protection.

Legislative Approaches

There are two major legislative approaches being taken to health care reform by Congress: (1) employer-mandated "pay or play" which would maintain and improve the current public/private multi-tiered system and (2) publicly funded and administered single payer which would replace the current 1,500 insurance companies with a single government agency that would pay for all services but would maintain private delivery of health care services.

Pay or play

There are two principal employer-mandated bills, one introduced by Representative Dan Rostenkowski in the House (HR 3205) and the other by Majority Leader Robert Mitchell in the Senate (S1252). Both bills provide for universal health care coverage by mandating employers to offer health care benefits to employees or to pay into a Public Health Fund created to provide health care to all U.S. residents not covered by the private insurance system. These bills also specify the minimum health care benefits to be available to both employment-based enrollees and to public fund enrollees and place limitations of $2,500/3,000 on the contributions which individuals and families can be required to pay. However, employment-based plan enrollees may receive additional benefits. Moreover, premiums paid by the two groups are calculated differently. Thus private employer plan premiums will continue to reflect current insurance company risk assessment practices based on the actual risk experience of the plan's enrollees as well as the administrative costs and profit needs of insurers and business. On the other hand, premiums under the public fund will be based on community risk assessments. The bills make it easier for small businesses to acquire insurance and make some changes to the insurance system so that it will better serve small businesses and limit its ability to refuse coverage to individuals.

In order to better control costs, these bills empower the Secretary of Health and Human Services to establish the nation's annual health care expenditures and provider payment rates for hospitals, nursing homes, and other facilities; physicians; and other health care professionals. A newly established federal Health Care Cost Containment Commission will determine the allocations of these overall expenditures to various classes of providers as well as allocations to be made for capital expenditures by hospitals and other health care facilities. These allocations and payment rates are established for both the private and public fund providers. However, states are authorized to vary these rates for the Medicare and public programs subject to the approval of the Secretary.

The principal arguments in favor of "pay or play" bills are that they extend coverage to all U.S. residents, provide assistance to small businesses to acquire insurance, limit the ability of insurance companies to deny coverage for pre-existing conditions, and give the Secretary of Health and Human Services power to limit overall health care expenditures and provider rates. Proponents claim that the bills are enactable today and constitute an important step toward a more comprehensive health care system. The principal downsides are that they perpetuate the current multi-tiered health care system with its attendant administrative costs, paperwork, and red tape for both physicians and consumers and place no restraints on premiums which insurance companies can charge for health care policies.

Single payer

The most comprehensive of the single-payer health care reform bills (HR 1300) provides for a comprehensive universal health care system, publicly funded and administered by the federal government (in Senator Kerry's bill also by the states) and available to all consumers simply by virtue of residency in the United States. Like the employer-mandated "pay or play" bills, single-payer bills stipulate the basic minimum health care benefit package to be provided although the single-payer bills provide for much more comprehensive health care coverage including home care and longterm care.(2) Similarly, they also provide for the Secretary of Health and Human Services to establish the level and application of annual health care expenditures for the nation and for each state as well as amounts and sources of revenues to be collected. The Secretary is also empowered to establish operating and capital budgets for the national government and for the states based on states' review and comments. Finally, payments to hospitals and other facilities are to be made on the basis of annual operating budgets consistent with national and states' health budgets and approved by the Secretary. Payment rates for physicians and other health care providers are also established by the Secretary.

These single-payer health care bills differ from the employer-mandated bills in several respects. They eliminate the multi-tiered health care systems and the enormous administrative costs attached to the need to assess eligibility, compensate insurance companies' marketing costs and profits, and comply with the diverse reimbursement and payment requirements of each of the 1,500 insurers and of Medicare and Medicaid. All individuals have basic health care coverage based on their status as a resident of this country. Health care providers have only one source of reimbursement and individuals have identical health care policies and coverage. Opponents criticize single-payer plans primarily because they involve a fundamental change in our health care system and an alleged potential for government instituted health care rationing which is feared will be more arbitrary than the current rationing of health care by private insurers and businesses and by the inability of individuals to afford health care.

Other proposals

President Bush recently announced the administration's health care reform proposal which seeks to achieve universality through a system of health care tax credits without essentially changing the employer-based insurance system. This is far less comprehensive than any of the pay or play proposals but like them reflects the notion of allocating health care resources on the basis of marketplace principles of competition and so-called consumer choice (The New York Times 1992a).

States have been experimenting with various ways to reduce their costs focusing primarily on reducing Medicaid expenditures. The most radical of these reforms is Oregon's health care rationing proposal. Under this proposal Medicaid would be expanded to cover all Oregon citizens below the poverty line but on a sharply curtailed and limited basis. Oregon developed a list of some 700 medical procedures from which 587 procedures will be available to Medicaid recipients. The selection of these 587 procedures was based on an assessment of their cost relative to effectiveness, their contribution, if any, to a patient's quality of life and to the well-being of society. Such things as viral pneumonia, viral hepatitis, chronic bronchitis, certain types of asthma, and certain back spasms were among the excluded procedures. In addition, these Medicaid recipients will be required to enroll in some form of managed care organization in order to further reduce costs (The New York Times 1992b).


The critical question confronting the nation is to choose the type of health care reform it desires. In making that choice, we have at least two models to look to: the current U.S. experience with its mixed public and private multi-payer employment-based system and Canada's single-payer health care system which has been in operation since 1971.

The results of the current U.S. system of allocating health care resources through the relatively autonomous decisions of individual insurance companies, employers, and health care providers have been a system whose costs are the highest among all industrial nations. It is a system that has favored specialists over generalists and family physicians, that has provided a higher range of high tech and quality care in urban and more densely populated centers than in smaller cities and towns, and that has excluded large segments of the population from care. It is a system that has plunged the bulk of the insured population into fear and insecurity about whether they will have the necessary health care coverage when they need it and whether they will be able to afford health care once they have to use it.

Given our marketplace approach to health care, these results are not surprising. While some employers and insurance companies negotiate lower fees from physicians and other health care providers, there is no single central authority with power to negotiate overall fees and charges with all health care providers. The results are substantial cost shifting among providers to make up for lower fees in one area by charging higher fees in another, refusing to serve lower paying patients, and/or to treat higher risk, more costly patients.

Competition among insurance companies for the consumer's health care dollar has not been reflected in competitive premium rates but in competition for the best possible risks. Individual risk assessment policies based on actual claims' experience of the particular group have replaced the more traditional community-based risks, have resulted in virtually foreclosing small businesses from obtaining affordable policies for employees, have barred entire industries from health insurance, and have excluded many individuals from obtaining insurance because of pre-existing or other high risk health conditions.

Efforts at cost containment have focused primarily on patients, reducing their "excess" health care usage through the imposition of user fees (copayments and deductibles) and restrictions on hospital stays, requiring the use of managed care systems which have limited consumer choice of physicians, and cutting back dependents' and retirees' coverages as well as overall coverage.

By contrast, the single-payer system as it has functioned in Canada has reduced Canada's health care costs substantially below those of the United States. It has also produced much higher satisfaction levels among Canadians. The Canadian system is a mixed federal and provincial government system with the federal government laying down the basic requirements which govern the health plans offered by the provinces. These plans must provide all medically necessary health care to all Canadian residents. The plans must be portable among the provinces, operate on a nonprofit basis, and be managed by public agencies accountable to the provincial governments. Thus each Canadian province is a separate insurer and has the discretion to cover other services such as prescription drugs for the elderly and dental care for children. The provinces receive capitation grants from the federal government amounting to about 38 percent of total costs, a 12 percent decline from the original federal contribution. They are free to finance their health care from any source although user fees may not be imposed. Most of the provinces rely solely on general tax revenues. Four provinces impose small premium charges.

In Canada, the provincial governments make all the critical decisions about how much money is spent annually on health costs, whether to insure services beyond those mandated by the federal government, and how to finance their health care plans. Canadian hospitals negotiate their annual global budgets with the provincial governments. Hospitals have no billing responsibilities which substantially cut administrative expenses. Capital budgets require special provincial government approval.

Physicians and health care professionals negotiate the fees they can charge with their provincial governments. Provincial governments also control the number of new medical students and interns and the ratio of specialists to generalists. Physicians submit monthly bills to the provincial government, substantially reducing the amount of paperwork and administration needed to get reimbursed for their services. They are not permitted to engage in balanced billing. Insurance companies may not offer policies covering the mandated government health care package but may offer coverage on other health care services not in the mandated coverage.

There are some downsides to the Canadian health care system. Canadian patients do not receive the same intensive high tech medicine as do U.S. citizens. It is generally agreed that the United States more rapidly adopts high technology health care equipment than Canada. For example, in Canada, only three hospitals for every three million persons are equipped to perform heart surgery. The Canadian Health Ministry, in consultation with cardiac surgeons, deliberately limited heart surgery wards in order to concentrate procedures and experience at a few centers. Some hospitals may be less comfortable, with hand cranked hospital beds and may use treatments causing more discomfort for patients. Physicians lacking CAT scans must perform examinations manually. There are substantially fewer cardiac catheterization labs, lithotripters (for crushing kidney stones), and MRI scanners per patient in Canada than in the United States.

Canadian physicians reportedly employ more conservative treatment protocols. For example, U.S. physicians tend to advise cholesterol testing for anyone over age 20 and treat patients with cholesterol levels in excess of 200. Canadian physicians, on the other hand, test only persons with a risk of heart disease and do not pursue treatment unless levels exceed 256. They claim that medical studies support these more conservative protocols. It is not clear whether these practice differences have resulted from Canada's single-payer system or simply reflect medical practice differences between the two countries.

Finally, there are waiting lists for access to hospitals for certain nonemergency procedures. Canadian patients must wait up to three months for cataract surgery, three to six months for coronary bypass, and five months for hip replacement. In addition, Canadians may have to travel some distances for certain procedures. Travel expenses are reimbursed for patients, but not for accompanying family members (The Washington Post 1991d, 1991e; The Wall Street Journal 1991; Neuschler 1991).

However, despite these real and alleged drawbacks, both Canadians and the Canadian health care establishment are wholly supportive of their system (Conklin 1991). Every person is insured from birth or upon entry into Canada; no person is denied coverage for any health or financial reason; benefits provided are more comprehensive than those typically provided in the United States; and the cost of health care is lower per capita in Canada than in the United States.


While most policymakers agreed there is a need for health care reform in the United States, they do not agree on how to change the system. A Wall Street Journal/NBC poll found that 69 percent of voters support universal health care even if it takes a tax increase to pay for it. Nonprofit, professional, religious, consumer, and public interest groups and unions are unanimous that the United States must adopt a universal health care system. They are divided, however, on whether this should be single-payer, pay or play, or some other system. Many are still working on which universal health care plan they support. The AFL-CIO decided not to take a position and to leave members free to take their own positions.

A strong public interest coalition has formed to push for single-payer legislation. Consumer Federation of America (CFA), Consumers Union, and Public Citizen as well as seniors' organizations such as the National Council of Senior Citizens and the Older Women's League, plus the National Association of Social Workers and the United Church of Christ together with American Federation of State, City, and Municipal Employees (AFSCME) and other unions belong to this coalition.(3)

The National Consumers League is the only traditional consumer organization which is not a part of this coalition. It is a member of Health Care America which was originally formed to promote Senator Mitchell's "pay or play" bill. While composed principally of health care oriented associations, Health Care America does include some nonhealth care related members such as the Children's Defense Fund, March of Dimes, National Council of Negro Women, National Hispanic Council on Aging, American Association of University Professors (AAUP), and the Episcopal Church. Other coalitions have formed to promote the "pay or play" bills. These tend to be heavily business, insurance, and health care related professional groups.

American Association of Retired Persons (AARP) has put forward a draft proposal which it claims is a combination of both single payer and pay or play. The plan would establish an improved and expanded Medicare plan universally available to all persons with monthly premiums, limited deductibles, coinsurance, and copayments. However, AARP's plan would expressly authorize the continuation of private insurance employer-sponsored plans which offer the same or improved benefits. Thus AARP's plan is essentially a pay or play bill as it envisages a two-tier health care system, one public required to serve all individuals and one private free to set premiums which in effect excludes individuals with high risk health care potential. AARP's board of directors has not yet taken final action on this proposed plan.


ACCI has played virtually no role in this critical health care debate. Indeed health care issues do not seem to have caught the research attention of ACCI members to any large extent. Its last two research conferences, 1988 and 1990, contained no discussion of the health care system as a whole or of any issues of access, coverage, costs, or insurance risk assessment practices.

The 1988 research conference papers were totally silent on any of these health care issues and in the 1990 research conference only four of the 49 papers presented dealt with health care at all. These looked at issues of health claims on labeling regulations, consumer awareness of medigap insurance, and the need for consumer information about HMOs and health care quality (Hampton et al. 1991; Pappalardo and Calfee 1991; Rudd and Glanz 1991; Talbert and Davidson 1991).

Over the years, consumer professionals and scholars have been calling on ACCI members to enlarge their traditional economic marketplace focus to encompass issues of human welfare and social justice. In the 1988 research conference, Helen Nelson called upon consumer researchers to go beyond the traditional narrow interpretation of the consumer rights around which the research conference was organized (Nelson 1988). Commenting on the papers presented on the Right to Safety, she pointed out that this right was much broader than product safety to which these researchers had confined themselves. Researchers, she said, need to be dealing with a much larger conception of safety than this conventional one and must ask such questions as, "How 'safe' is a consumer who has no access to health care services? How 'safe' is the consumer who has no entitlement to the delivery of medical services?" (Nelson 1988, 97). Her voice and perceptive questions about health care constituted the only reference to health care I could find in the 940 pages of papers presented at that conference.

In the 1990 research conference, both Esther Peterson and Bob Mayer, echoing Helen Nelson's plea, called on the consumer movement to enlarge its concerns beyond what Mrs. Peterson called "the nickel and dime view of our interests." Mrs. Peterson urged ACCI members to focus research on issues that would "move the public into a consciousness of the consumer movement as pursuing responsible and involved citizenship" (Peterson 1991, 567). "Isn't it time," she asked, "we came up with an accepted social index that measures health, literacy, shelter, items of well-being, in place of economic indexes that do not measure where we are in human terms? While society's major institutions are still fixed on defining and measuring value in economic terms, we witness an enlargement of how ordinary people define their consumer interest, from the self-interest of the best buy to the wider interest in a fair, safe, and healthy world" (Peterson 1991, 565). Bob Mayer in his "Overview" stressed the same theme. He pointed out that enhancing consumer choice is not simply an economic market enhancing phenomenon but is compatible with and instrumental to "achieving widely shared social goals pertaining to justice" (Mayer 1991, ix). Both Scott Maynes (1991) and Ed Metzen (1991) in their research recommendations urged ACCI members to broaden their concepts of values and to range beyond what can be statistically demonstrated and involve themselves in qualitative research questions.

These voices reflect a phenomenon in the consumer movement which has concerned me for a long time. Back in the 1970s, Michael Pertschuk was still viewing the consumer movement in protectionist terms as a fight to protect consumers from corporate abuses in the marketplace while other consumers were organizing themselves outside of the traditional consumer movement to deal with issues of the environment, social security, disability, civil rights, women, and older persons. These groups sensed that the problems they were concerned with did not fit easily into the traditional consumer movement's "win-lose," "we-they," or "white and black hat" syndrome framework. They recognized that it was not easy to evoke public outrage when the target was not corporate misdeeds as much as the need to balance and weigh conflicting interests and demands. (I expressed this view in 1982, see Uhl, Herrmann, and Jones (1982).). While the traditional consumer movement eventually made common cause with many of these groups and frequently worked with them in coalitions, consumer research has by and large not made the same shift.

As the debate on health care reform develops, it is time for ACCI to take needed leadership in analyzing and illuminating these issues so that consumer and public interest organizations supporting universal health care can be assured that the program they support will in fact provide consumers with cost effective and realistic access to comprehensive quality health services without regard to their ability to pay.

Research questions

ACCI researchers need to address several important questions.

Canadian health care system vulnerabilities. While the Canadian health care system has been cited by many as a model for the United States, questions have been raised about the efficacy of the Canadian system and its applicability to the United States. Its financial stability is challenged by some as are the impacts on the quality of health care of efforts to impose cost constraints on hospitals and other facilities. How do waiting periods for nonemergency surgery affect consumers? To what extent is Canada's more cautious acceptance of high technology hurting the quality of care available? This is an enormously fertile field for ACCI researchers, and their contribution to the debate can be substantial.

Centralization and decentralization of U.S. health care system. In the United States, one of the major debates that arises with either of the reforms now being discussed concerns the extent to which the health care system should be decentralized. We have had experiences with both centralized and decentralized national programs. Social security and Medicare, for example, have been nationally administered while unemployment compensation and Medicaid have been largely relegated to the states. These are just a few examples of our mixed federal/state system. Plenty of studies have been made of federal/state programs in terms of their relative efficiency, costs, etc. I believe, however, that we need research which focuses on how these various systems have impacted consumer welfare (with respect to such values as consumer control, choice, confidence, quality of service, etc.). Can we learn anything from our own history that will help us determine how we want to administer our national health care system?

Efficacy of managed care systems. Cost containment is a major goal of health care reform. HMOs and PPOs are regarded by some as important cost containment mechanisms in the United States and now are being considered in Canada. The advantages and disadvantages of these managed-care programs need to be analyzed within the context of impact on consumer choice, quality of care, and access as much as on costs. Consumer researchers have the insights and sensitivities to frame the questions which need to be answered in appraising whether HMOs have hurt or benefited consumers' access to quality health care.

Scope of health care benefits. Our current health care system has been skewed in favor of acute illness rather than preventive care. It has also poorly served the health care problems of women, older persons, and ethnic and racial minorities. Thus a critical feature of any health care reform plan is the scope of its benefit coverage. The disparate incidence of illnesses among different population groups in this country has not been reflected in health care research and must not be ignored in the drafting of health care benefit proposals. The definition of longterm care, including home care and personal services, is another question of critical importance to the disabled, the chronically ill, and the elderly and must be resolved on the basis of hard facts concerning incidence, cost of alternative treatment, and quality of life for consumers. Coverage of mental health is another important issue which has not received major attention in the consumer literature. Yet, the incidence of mental health problems (drug abuse, depression, stress as well as more common mental health illnesses) is widespread among youth, elderly, and probably generally throughout the population. It is essential that consumer researchers, with their special sensitivities toward these consumer groups, examine these health care needs, explore the health care experience of other industrial nations, and define a health care benefit package which corresponds to the principal and most frequent health care needs of all Americans.

Financial impact on consumers. Because a single-payer health care system creates an essentially new health care system so far as financing and administration are concerned, a central question to be answered is its financial impact on individuals and families as compared with their current health care situation. This analysis was never made with respect to the catastrophic health care legislation which was repealed because consumers discovered that under the legislation many of them would have to pay more for less coverage than they already had. It is essential that this mistake not be repeated with the health care reform bills pending before Congress. I know of no other group of researchers better qualified than ACCI members to design a comparative research study of how families and individuals who have top insurance coverage, mediocre coverage, Medicare, and Medicaid each fare under today's system compared to their situations under a single-payer system, looking at such variables as coverage, costs, security, and stability of coverage.

I believe that Ed Metzen was right when he proposed that ACCI should devote its research conferences to single issues so that it can in fact explore these issues in depth. Nothing could be more timely than for ACCI to devote its next conference to the issues of our health care system through its call for papers. ACCI can ensure that the research will be relevant to the current debate. Its papers can make an important contribution to that debate. By providing relevant data on the consumers' interest in health care, ACCI's researchers can ensure that the interests of consumers and not just of business and the health care industry will be taken into account in framing the ultimate reform legislation.

Mary Gardiner Jones is President, Consumer Interest Research Institute, Washington, DC.

1 One author argues that this difference in growth rate is actually due to the faster growth of Canadian GNP as a whole rather than to its slower health expenditure growth rate. However, that author bases his figures on a 20-year comparison period, 1967-1987, which includes three years before the Canadian system became operational.

2 It should be noted that in the Russo single-payer bill, the health care benefit package is substantially more generous than either of the employer-mandated bills and includes home and long term care.

3 The contact for information about this coalition is Citizen Action, 1300 Connecticut Ave., NW, Washington, DC 20036.


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Title Annotation:Colston E. Warne Lecture
Author:Jones, Mary Gardiner
Publication:Journal of Consumer Affairs
Date:Dec 22, 1992
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