CommonHealth Newsletter - Spring 2011

UNIVERSAL HEALTH CARE EDUCATION FUND ~ VOLUME 5, NUMBER 1 ~ SPRING 2011

CommonHealth
Filing Our Bill National Action
“An Act for Improved Medicare for All In Massachusetts:
Providing Guaranteed Affordable Health Care” was filed by co-
sponsors Senator Jamie Eldridge and Representative Jason Lewis,
and has been referred to the Joint Committee on Health Care
Financing. About forty-five other legislators have signed on as
co-sponsors. Thanks to the analysis provided by Gerald
Friedman, U-Mass Amherst economist (see page 3), we know
that our current single-payer bill, when passed and
implemented, will save the Commonwealth of Massachusetts, its
businesses, families and individuals at least $9 billion per year!
You can read the bill and Friedman’s analysis on the Mass-Care
web site.

Like our previous bills, this one will provide quality health care Ben Day welcomed James Haslam from the Vermont
for all Massachusetts residents, eliminate the large amount of Workers Center to our Ben Gill gala. He brought us up
insurance overhead (including huge CEO compensation and to date on the exciting grassroots movement for
marketing) taken out of each of our health insurance premium single payer in the Green Mountain State. On May 1st,
dollars, eliminate the high cost to medical providers for dealing as the bill moved forward but remained vulnerable to
with the voluminous paperwork and varying regulations required crippling amendments, supporters rallied in Mont-
by individual insurers, eliminate price gouging by setting prices pelier to make sure health care would become a
for manufacturers and service providers, and encourage early human right, no longer a commodity or privilege.
intervention and prevention of diseases, and set reasonable Among the Massachusetts folks who joined the rally
limits on administrators’ compensation.

Unlike our previous bills, it has a new name. It’s no longer called
“An Act to Establish a Health Care Trust,” even though it would -
and it specifies how Medicare for All would be financed.

1) An employer payroll tax of 7.5 percent will be assessed,
exempting the first $30,000 of payroll per establishment,
replacing previous spending by employers on health premiums.
An additional employer payroll tax of 0.44% will be assessed on
establishments with 100 or more employees;
2) An employee payroll tax of 2.5 percent will be assessed,
replacing previous spending by employees on health premiums
and out-of-pocket expenses;
3) A payroll tax on the self-employed of 10 percent will be
assessed, exempting the first $30,000 of payroll per self- were Sue & Abe Chipman from Brookline and Peter
employed resident; and Knowlton from Taunton, heading a strong presence
4) A tax on unearned income of 12.5 percent will be assessed to by the United Electrical Workers. The California single
fairly distribute the costs of health care across various sources of payer bill was recently reported out favorably by the
income. (Social Security and welfare and disability payments will Senate healthcare committee. On Capitol Hill,
not be considered unearned income.) Representative John Conyers refiled his Medicare for
All bill, HR.676. Senator Bernie Sanders of Vermont
A private or public employer may agree to pay all or part of an and Representative Jim McDermott of Washington
employee’s payroll tax obligation. Such payment shall not be have just filed a bill endorsed by the AFL-CIO that
considered income for Massachusetts income tax purposes. would move the country forward to single payer
through partnership with the states, requiring a high
You can help to get the bill passed by informing your legislators
standard of care nationally. - Sandy Eaton, RN
about it and asking them to sign on as supporters if they have
not already done so. You can also help by asking current co- Universal Health Care Education Fund c/o Mass-Care
sponsors (listed on the Mass-Care web site) to actively work to 33 Harrison Avenue, Fifth Floor, Boston, MA 02111
get the bill moved out of committee, acted on and passed on the P: 617-723-7001, F: 617-723-7002
floor of both houses of our legislature. - Judy Deutsch info@masscare.org http://www.masscare.org

Health Care Costs & the Needless Mass-Care Single Payer Gala Fills
Attack on Public Sector Employees Ryles Jazz Club in Cambridge
In order to rein in a massive budget deficit - a deficit It was standing room only at the 13th Annual Gala in
caused more by health care costs than any other factor - Memory of Benjamin Gill on March 26th! While enjoying a
the Massachusetts House of Representatives recently spread of tasty snacks from S&S Deli, attendees socialized
passed a proposal that would allow cities and towns to and listened to music by Bo Winiker (trumpet) and Jamie
strip public employees of their right to bargain health Saltman (piano).
care benefits, and both the Senate and Governor's office
are contemplating compromise versions of this proposal. Mass-Care co-chair Jackie Wolf welcomed everyone and
This is tragic for three reasons: introduced the first keynote speaker, UMass economist
Gerald Friedman. Professor Friedman’s engaging style
First, it is not true that public employees enjoy better kept everyone’s attention as he explained the impact of
wages and benefits than the rest of us. Compared with single payer reform in Massachusetts and options for
private employees with the same education level, public financing it.
workers have better benefits but lower wages. This trade-
off turns out to apply to all of us: the economics literature During a break for dessert, everyone had a final chance to
has found that employers do not pay for any health care buy raffle tickets and Mass-Care items such as hats and
costs, but rather pass these costs on to employees in the Pat Berger’s posters before Katie Murphy conducted the
form of lower wages. When the country goes through raffle drawing. Joseph Lillyman’s piano solos provided the
periods of rapidly climbing health care costs, real wages perfect background music, which even stimulated some of
stagnate or decline - in fact, almost all of the stagnation the attendees to dance.
in lower- and middle-class wages is due to our health
care system producing out-of-control costs. Unionized The 2011 Dr. Benjamin F. Gill Memorial Awards were
workers just have the luxury, if you can call it that, of presented to three honorees for their consistent work in
trading better health coverage for their families in support of Universal, Single Payer Health Care in
exchange for lower wages than private sector workers Massachusetts:
receive for the same work. If the House budget were to
become a reality, it is likely that municipal employees who • Reverend Judy Deutsch, for her tireless efforts on behalf
have been sacrificing wages for years to retain health care of single payer since 1945.
coverage, will lose both and fall behind their private- • Matthew Patrick, State Representative from the 3rd
sector counterparts. Barnstable district for five terms, who was the lead
sponsor of the single-payer bill in 2009-2010 and a
Second, none of this is necessary. We are the only country leading advocate for progressive energy reform and
in the world with costs as high, and growing as rapidly, as democratization of the legislature.
ours. In exchange for our high and rapidly rising costs, we • Walpole Peace and Justice, who put a single–payer
actually get worse health outcomes and extraordinarily question on the ballot in Walpole and Norwood and won
poor access to needed care. Health care is now about half majority support in that district, as well as for a ballot
of the state budget, consumes almost all of municipalities' question in Walpole and Dedham.
new revenue each year, and we are getting literally
nothing for our new spending each year. A single payer The second keynote speaker, direct from Vermont, was
plan for Massachusetts, which is not experimental and James Haslam, Executive Director of the Vermont Workers
has been tried and proven around the globe, would save Center. His group has carried out a well-organized, highly
state and local governments in Massachusetts between successful grassroots campaign that has resulted in
$1.5 and $2 billion, according to estimates from UMass Vermont possibly becoming the first state in the nation to
economist Gerald Friedman. This would close our budget enact single payer health care legislation. Mr. Haslam’s
deficit. Municipalities, like all other employers, would pay energy and enthusiasm were inspiring to all as he detailed
a 7.5% payroll tax, and would not have to face rising the steps involved in organizing the campaign.
health care premiums ever again. Almost all municipalities
currently spend upwards of 15% of payroll on health care The program ended with remarks from Ben Day.
costs - the city of Boston, for example, spends about
20%. This event was a success thanks to the leadership of
Mass-Care co-chair Pat Berger. The Gala Program Booklet
Lastly, although you have all heard a lot of rhetoric about was attractive and fun to read(!), thanks to Ben Day and
public employees having lavish benefits paid for by intern Claudia Chauca. Volunteers who helped produce
taxpayers (which we have just disproved - public the event included: Carol Caro, Asha Cesar, Marty
employees are paying for their own benefits with lower Downes, John Blanchard, Vic Bloomberg, Joseph Lillyman,
wages), remember who pays for most tax revenue: rich Bea Mikulecky, Nivedita Poola, Leo Stolbach and Maria
people! Massachusetts has a flat income tax, which means Termini. - Bea Mikulecky
it is not as progressive as the federal income tax, but still
- because income inequality is so high in Massachusetts - Logo of the Health Care is a Human
a very large share of our total tax revenue comes from Right Campaign of the Vermont
high income households paying their share. When we shift Workers Center
costs from tax revenues onto patients, which is what the
state is proposing by cutting coverage for public workers,
we are also making our health care financing much more
regressive, and letting high-income earners off the hook.

Can we afford universal coverage? Can we afford anything else?

American health care is afflicted by two unsustainable conditions, rising costs and declining coverage. While critics charge
that a single-payer health insurance system would exacerbate the cost problem by expanding coverage, such criticism is
founded on a mistaken model of health care and is inconsistent with the experience of other countries with public health
care systems providing universal access. Indeed, it appears that the only way that the United States can control health care
costs and avoid fiscal and economic catastrophe would be by establishing a system of universal health insurance with a
single payer.

Advocates of single-payer health insurance recognize that the
rising cost of health care threatens the American economy. For
decades, the cost of health insurance has been rising at over twice
the general rate of inflation; the share of American income going
to pay for health care has more than doubled since 1970 from 7%
to nearly 17% even while more Americans are doing without health
insurance or have inadequate coverage.

If health insurance were like other commodities, like shoes or bow
ties, then reducing access would lower costs. But health insurance
is different because insurers can increase profits by reducing
access to insurance even when this drives up total expenditures.
The health insurance and health care economy are different from
most other markets because private companies selling insurance do not want to sell to everyone but only to these unlikely
to need health insurance. Insurers profit by screening subscribers to identify those likely to submit claims and to harass
them so that they will drop their coverage and go elsewhere. The collection of insurance related information has become a
major source of waste in the American economy because it is not organized to improve patient care but to harass and to
drive away needy subscribers and their health-care providers. Because driving away the sick is so enormously profitable for
health insurers, they are doing it more often, creating the enormous bureaucratic waste that characterizes the process of
billing and insurance handling. Rising by over 10% a year for the past 25 years, health insurers’ administrative costs are
among the fastest rising costs in the American health care sector. Doctors in private practice now spend as much as 25% of
their revenue on administration, nearly $70,000 per physician for billing and insurance costs.

Not only are health-insurance administrative costs wasteful, they create waste by driving the sick into more expensive care
settings. Inadequate health insurance turns small conditions into major problems, and drives the sick from doctor’s
officers into expensive emergency room and hospital settings.

The great waste in our current private insurance system is an opportunity for policy because it makes it possible to
economize on spending by replacing our current system with one providing universal access. I have estimated that in
Massachusetts, a state with a relatively efficient health insurance system, it would be possible to lower the cost of
providing health care by 17% (as much as $10 billion a year) largely by reducing the cost of administering the private
insurance system with most of the savings coming within providers’ offices by reducing the costs of billing and processing
insurance claims. In a report prepared for the State of Vermont, Professors Hsiao (Harvard) and Gruber (MIT) estimate that
shifting to a single-payer could lead to savings of around 25% through reduced administrative cost and improved delivery
of care (saving $600 million in little Vermont).

A comparison of health care in the United States with health care in other countries also demonstrates how a single-payer
system leads to cost savings by improving care. When Canada first adopted its current health-care financing system
around 1970, the health-care share of the national gross domestic product was similar in the United States (7.1%) as in
Canada (6.9%). Since then, however, health care has become dramatically more expensive in the United States where health
care spending has risen by over $6,900, nearly double the increase in Canada. Had Americans experienced better health
outcomes, then we might accept these higher costs. Instead, however, we have gone from a relatively healthy country to
the country with the shortest life expectancy of these advanced economies. Our gain in life expectancy since 1971 (5.4
years for women) is impressive except when put beside other advanced economies (where the average increase is 7.3
years). Had the United States increased life expectancy at the same dollar cost as in other countries, we would have saved
nearly $4,500 per person; had we increased life expectancy at the same pace per dollar spent as in other countries, we
would have bought an extra 10 years of life expectancy.

The international comparison also provides another perspective on any supposed trade-off between cost containment and
coverage expansion. In other countries than the United States, almost all of the increase in health care spending out of
national income is due to better quality health care as measured by improvements in life expectancy. The problem of rising
health care costs is almost unique to the United States, the only country without universal coverage and without any
effective national health plan. - Professor Gerald Friedman

Coffee with Susanna Reaching Out to Congregations
We were gossiping, talking about almost everything, A few months ago, I started working as an outreach
then our mood changed as Susanna dropped a bomb volunteer with Mass-Care. I have been very busy contacting
into our other wise comfortable conversation. churches and congregations to offer them a presentation on
the promise of single payer health care. I am also writing
Last month she had a suspicious mammogram, letters to the editor. I decided to take on this task when I
her doctor ordered a second set of x rays, realized how clearly health care is a justice issue. It is crucial
but her insurance company won’t pay for them. and natural for faith communities to work for justice in
health care. I sense a lot of confusion from people about
Susanna is a single mother, a job by itself, single payer health care and believe that education on this
and she works another full-time job, issue is the place to start.
barely gets by and can’t afford home repairs. I have developed, with expert help from Dr. Pat Berger, a
short presentation that explains the crisis in health care, the
My friend’s voice shakes with worry,
qualities of sustainable health care reform, what single payer
we both know her mother died of cancer. health care is, and how it represents justice in health which
Something is very wrong with this picture, is most truly a human right.
even though my friend has insurance
I also talk about how past health care reforms have failed
she can’t get the care she needs,
and how the single payer bill currently in the Massachusetts
because corporate profits and greed
legislature, the Medicare for all Massachusetts Bill, can give
control our health care industry. everyone affordable, comprehensive and sustainable health
How long will this injustice continue? care. I would like to make single payer health care a
household word in Massachusetts and believe that people
Maria Termini
will support single payer health care to the degree that they
know about it and understand it.
Ellen in Medicaland
I have focused on contacting congregations near Boston, but
Ellen Kagan has reached many thousands over the last we need to expand this outreach to the entire state. I have a
fifteen years through her health education TV and radio background in this kind of work because of my experience
series, Your Health Care: Choice or Chance? Her tales with Habitat for Humanity, which involved coordinating
from the healthcare twilight zone will now continue to hundreds of volunteers from many congregations who
bring compassion and hope to wider audiences through worked to build houses with poor families. I believe people
print, now avail- of faith are ready to work for justice in health care. Please
able on Kindle. A contact me if you know a congregation or group that would
study published like a presentation or if you would like to be on our
recently reveals committee.
that hospital care
injures almost one - Maria Termini, 617-928-1544, leafdancer@verizon.net
in five patients.
Bureaucratic
efforts have failed
to improve patient
safety after a de-
cade of trying.
Only an enlight-
ened, engaged and outraged population will establish
and enforce high standards of care. Ellen has worked
on the cutting edge of the movement for that standard.
We continue this fight for high standards as a right of
everyone encountering our profit-driven healthcare
non-system. - Sandy Eaton, RN

Picture at right: Peter Knowlton and his grandson Travis celebrate
May Day and enjoy the good weather in Vermont while
campaigning for a just healthcare system.

CommonHealth, Volume 5, Number 1:
Director: Benjamin Day
Editor & Photographer: Sandy Eaton
Production: Erin Servaes
Printing compliments of the Massachusetts Nurses Association

CommonHealth Newsletter - Spring 2011

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CommonHealth Newsletter - Spring 2011