Following months of debate, the Senate Finance Committee hopes to approve a bill this week that would bring substantial reform to America’s healthcare industry.
However, despite its likely approval, the bill is still met with apprehension. Alan B. Miller ’58, the main financial contributor to the new Mason School of Business, as well as the chair and CEO of Universal Health Services, Inc., discussed his concerns about the potential effects of healthcare reform at the Business School Sunday.
Miller began by discussing how the flaws in the current healthcare system, such as limited access, high costs and poor quality, have led many to believe that healthcare reform is needed. Many Americans have inadequate care, and 45.7 million Americans are uninsured. Despite the fact that the United States spends more on healthcare than any other industrialized nation — 16 percent of the country’s gross domestic product — it remains a flawed system.
Insurance is also very expensive. Families are paying higher premiums, which have increased by 100 percent in the last decade. Despite high costs, Americans are frequently misdiagnosed and their life expectancy is lower in comparison to other industrialized nations. About 100,000 Americans die each year due to medical mistakes.
One of the most contested components of legislation currently moving through Congress is the inclusion of a public health insurance option that would compete with private insurers.
The Senate Finance Committee recently removed the public option from its version of the bill.
Miller focused on the possible effects of competition between a possible national and private healthcare providers. With an unlimited budget, Miller said, the government could lower premiums, which would allow employers to save money by moving employees from private plans to government programs.
However, restructuring is not without cost.
If the government sets lower premiums, many of the United States’ 1,300 private insurance companies may not survive the reform because they would not be able to compete with cheap public insurance while making enough capital to provide expensive medical care and fuel their corporations.
“That’s basically what the fight is about,” Miller said. He added that there is a struggle between those who promote government-run companies and those who seek to preserve private insurers.
In defense of insurance companies, Miller explained that insurers do not prioritize profit, but spend a sizeable chunk of their earnings on providing coverage and paying employee salaries.
Miller said that companies have high costs and complex expenditures. Claims that insurance companies intentionally disadvantage their subscribers are false.
“The idea that insurance companies participate in fraud is a fabrication,” Miller said.
Private insurance companies play a critical role in the healthcare system.
These providers design a multitude of plans that cater to a diverse clientele, negotiate hospital rates for subscribers, evaluate technology, police fraud and help patrons make better decisions regarding treatment, among other duties.
Miller also addressed the alleged misconception of statistics showing 45.7 million uninsured Americans. Dissecting this number, he said, reveals that a lack of insurance is not a critical issue. Of the 45.7 million, 11 million Americans are eligible for Medicaid, 9.7 million are not United States citizens and 9.1 million are
between 18 and 31 years old and have an annual salary of over $75,000.
“[At that age,] you feel like you’re indestructible,” Miller said. “They don’t want coverage. They want new cars.”
Students at colleges and universities constitute 4.6 million of the uninsured and are unlikely to accrue large medical expenses. It is only the remaining 16 million people who cannot afford insurance and do not have access Medicare and Medicaid.
Miller supports the preservation of the country’s current system and suggested three amendments: tort reform, insurance availability across state lines and tax reductions for employers. Tort reform would limit payments made by a plaintiff’s attorney for punitive damages. This payment cap would also reduce malpractice premiums for doctors.
Currently, a maximum of three private insurers provide healthcare to a single state. Miller argues that allowing companies to sell across state lines would increase competition and lower prices for small businesses and individuals. Tax reductions for employers who provide insurance to their employees will decrease financial burdens on small businesses.
Some students disagreed with Miller’s perspective.
“Miller underestimated the amount of people who are uninsured,” Molly Bulman ’12 said. “His basic argument was that if only 16 million people lack insurance there is no need to revamp it for the majority of Americans.”
Bulman, who is passionate about healthcare reform, was concerned by Miller’s approach.
“Miller works with catastrophic care victims and people who need testing. He most likely doesn’t concentrate on preventive care,” Bulman said. “[He] turned the debate into one of finance rather than one of ethics and policy.”