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April 19, 2014

Government Healthcare Delivery More Efficient Than Private Sector


America’s safety net, specifically Medicare is continuously under attack. Many politicians claim that its growth rate makes the budget deficit untenable lest there be substantial changes; in other words, draconian cuts.

An article in the Business Insider  by Joe Weisenthal is dispelling that myth. He states

The conventional wisdom on the deficit is: Right now the deficit doesn’t pose a problem, but thanks to the gigantic growth in healthcare costs, it’s inevitable that the government will get swamped by Medicare spending, ergo we need to tweak the system.

Peter Orszag, who was the head of the Office of Management and Budget under Obama, and who is now at Citi, offers up a chart that could be a Medicare costs game-changer.image

“This graph from S&P illustrates two key facts: health-care costs have decelerated over the past few years, and Medicare costs have decelerated more than other health costs. That pattern suggests at least part of the slowdown is structural (since if it were all just a reflection of economic weakness, we wouldn’t expect Medicare to slow down more than other health costs, but if it were partly structural, that’s exactly what we would expect). If this slower growth continues, the impact on our long-term fiscal gap will be much more meaningful than any plausible outcome of the fiscal cliff negotiations.”

Americans have been asked for decades to disregard basic arithmetic. Americans have been led to believe that private insurance is more efficient than government insurance, Medicare. Americans have been told that somehow “cost of health care” + “healthcare administration cost” is greater than “cost of health care” + “healthcare administration cost” + “advertising” + “profit”.

The purveyors of misinformation have cost this country billions if not trillions of dollars. This is a direct transfer of wealth from the middle class to the owners of private insurance companies for paying a medical bill. It is the immorality of health insurance.

While the above chart is not intended to be a debate piece between single payer healthcare (Medicare for all) and private insurance, one can infer which is more efficient.


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About ewillies

Egberto Willies is an radio show host, author, blogger, political activist, DailyKOS Featured Writer, Vice President of Coffee Party USA, Executive Committee member of Move to Amend, 2nd Annual CNN iReport Spirit Award Honoree, HuffPost Live Contributor, self-employed software developer, & web designer. Egberto wrote the book ‘As I See It:Class Warfare The Only Resort To Right Wing Doom’ based on his belief that the mainstream media is derelict in its duty to relate what really ails the middle class and the complicity of the Right Wing in its demise. Bio: http://egbertowillies.com/bio/ Linked In: http://linkd.in/TOiHUS. Google

Comments

  1. John W. Mikus says:

    There is another cost associated with private health insurance that would be eliminated by Improved Medicare for All and that is the huge burden it places on small businesses that would free them up to hire more employees and manufacture and export more goods and compete in the world economy. Now there’s a real job creation and balance of payment and debt reduction bill to pass!

  2. The private monopoly or oligarchy of private monopolies providing Americans health care takes about 25 cents out of every health insurance premium dollar to deny patients needed care in order to generate about 10 cents out of every premium dollar for its private shareholders. That’s at least another 25 to 30 cents that the public monopoly of an Improved Medicare for All could spend on better doctors and better patient care, especially preventive care with decreasing health care costs and improve health care outcomes in the long run being the result in stark contrast to the never ending increases in private health insurance premiums and little improvement in health care outcomes of the private monopoly. Also Americans have no control over private monopolies run by CEOs and Boards of Directors. At least Americans have some control over the decisions of their political representatives especially when the undue influence of self-aggrandizing private health insurance companies is eliminated by Improved Medicare for All.

Trackbacks

  1. [...] Sadly, when it comes to understanding our private health insurance system, Americans have been duped into defying the rules of arithmetic. In other words the mis-informers would like you to believe that somehow “cost of health care” + “healthcare administration cost” is greater than “cost of health care” + “healthcare administration cost” + “advertising” + “profit”. The fact is that government healthcare delivery is more efficient than private sector. [...]

  2. [...] us. What is ironic is, had those that opposed the bill engaged, they could have codified a system, though less efficient, more to their liking. As it is, those governors not setting up exchanges or not taking certain [...]

  3. [...] to those who scream against “socialized” medicine. They should use it as a warning to socialize the portions of our healthcare system that would best work without a profit motive and a portion where a profit a motive is justified. Much is resting on the outcome of this [...]

  4. [...] to those who scream against “socialized” medicine. They should use it as a warning to socialize the portions of our healthcare system that would best work without a profit motive and a portion where a profit a motive is justified. Much is resting on the outcome of this [...]

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