How the corporate sector is wrecking America’s health—and what to do about it
As featured in Quartz | June 7, 2017 | by Jeffrey Sachs and Vikas Saini
The Obamacare repeal that passed the House is an unpopular and defective bill that would hurt the poor, the sick, and older workers, by raising deductibles and premiums on health policies for these highly vulnerable groups. Yet there is also a real opportunity in the Senate to make something beneficial out of this process. The public wants more and deserves better when it comes to health.
America’s health is in a crisis that has three parts.
The first is access: healthcare is far too costly for most Americans. The situation is worst for the poor and those with pre-existing health conditions, but it’s bad enough for almost everybody except the rich. Thus, tens of millions of Americans too young for Medicare cannot afford private health coverage. Their lives depend on government-financed health services, but with Republicans all too ready to throw them overboard in the name of budget savings.
The second challenge is unhealthy lifestyles, especially America’s fast-food diet. America has the highest obesity rates of any high-income country in the world—nearly 40%. The fast-food diet—French fries, sweetened beverages, and super-high meat consumption—is killing Americans.
The third challenge is the despair arising from working-class households falling further and further behind in incomes and jobs, with the associated behavioral consequences. As recent studies have shown, deaths rates have soared for working-class white, non-Hispanic Americans, especially around diseases related to falling incomes: suicide, substance abuse (including the shocking opioid epidemic), and depression.
Yet we would argue that all three of these crises arise from an even deeper problem: the corporate control of healthcare and politics more generally. Our health outcomes are the result of a society in the grips of several powerful corporate lobbies: the drug companies, the health providers, the health insurers, and the fast-food industry. Together they have promoted the unhealthy diets, opioid dependencies, and super-high-cost health insurance and healthcare that bars access to lifesaving services. In the past, your income determined how you lived; now it often determines if you live.
If we add in the political power of Wall Street and the mega-rich campaign donors, we complete the picture. We are getting what we pay for, or rather what the mega-rich and the lobbyists are paying for: a health crisis that is driven by the preferences of the healthcare industry, the food industry, and the rich in general, who pay low taxes and tend to their own health needs in private while most Americans suffer the consequences. And we shouldn’t forget that Wall Street has recently become a leading actor in the healthcare field, buying up drug companies in order to jack up prices, and financing the mergers of healthcare providers in order to boost monopoly power.
The question then is what to do. Our answer also lies in three parts.
The first: cut health care costs so that insurance coverage can be guaranteed to all. There are many dimensions of cost cutting. The Food and Drug Administration (FDA) should take drastic actions to open the way for generic drug competition, including imports from abroad. Medicare, Medicaid, and the VA together should be empowered to negotiate drug prices with big Pharma, thereby ending the abuse of the American people at the hands of the drug industry.
The Federal Government and state Medicaid should also move away from the current system that reimburses health providers for each disease episode to a system that shifts incentives of the health providers towards disease prevention and lower-cost primary care. One option is “capitation,” meaning that the health provider receives a fixed payment per year for each enrollee, and thus has an incentive to keep overall costs low by preventing diseases in the first place. Yet capitation also requires accountability of the health provider so that it doesn’t cut corners by denying needed services.
The second: bring substance abuse and unhealthy diets under control by reining in the corporate mismanagement that has brought about these conditions. The fast-food industry has had a free hand long enough. America’s very own McDonalds, Wendy’s, Subway, Coca Cola, Pepsico, and others need to answer for the greatest obesity epidemic in the world. They are not mere bystanders in this disaster, and they need to be agents of solutions. So too with the producers and marketers of the opioids now addicting and killing Americans by the millions. In addition to stopping new addictions, we urgently need a massive expansion of treatment facilities to help the victims of the current epidemic.
The third: recognize that a house divided cannot stand, as Abraham Lincoln noted long ago in a different context. America cannot thrive deeply divided between the rich and the poor, and between a professional class with a Bachelor’s degree or higher and a working class with a high-school diploma or less. Our health crisis is deeply intertwined with soaring inequality. The rich are getting healthier; the working class and poor are dying of despair.
Other countries face the very same tendencies towards inequality as in the US, including globalization of trade, offshoring of jobs, and automation of assembly lines. Yet Canada, Germany, the Netherlands, Denmark, Norway, and Sweden, all counteract these inequalities through public policies. Healthcare is financed by government revenues; college tuitions are low or zero, with the government picking up the tab. Vacation time, leisure, maternity leave, sick leave, and childcare are all ensured. How do they pay for it? Through tax revenues, including a clampdown on loopholes for the rich.
One can despair at the greed of the House vote, on a piece of legislation that was pushed through without a day of hearings or public deliberation. But now the Senate can weigh in. This is an opportunity to face up to the real health crises in this country, and to find solutions that go to the core issues—the need to control costs, force corporate responsibility, and reduce the grievous and growing inequalities in American society.