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John W. MillerMay 29, 2020

The United States spends $4 trillion each year on health care, a bigger industry than Hollywood, professional sports and automotive combined, and equivalent to the gross domestic product of Germany. But as a deadly global pandemic killed over 320,000 people, the richest country on earth could not insure tens of millions of people like Anne Winslow, 57, of Lancaster, Pa.

Ms. Winslow earned a college degree and worked her whole life, mostly in early childhood education, and reared six children of her own after escaping an abusive marriage. She does not have major medical issues; she needs inhalers and EpiPens for her asthma, which makes her vulnerable to the new coronavirus, which causes Covid-19.

Before she was laid off in March, a month short of qualifying for employer-funded health care, Ms. Winslow worked up to 50 hours per week at a suburban craft store for $9.44 an hour. Like millions of other Americans working low-wage service jobs with paltry benefits and no union, she was earning too much, $1,200 a month, for Medicaid, and not enough to pay for private insurance. Ironically, losing her job may sink her income enough to qualify for Medicaid, for which she has applied, along with unemployment. “I’m used to it; I’ve been struggling my whole life,” she said. “But I am hoping for something better.” The data shows that Ms. Winslow is not alone. In 2018, U.S. Census Bureau data showed that 27.5 million Americans lacked health coverage at some point during the year.

Insurance coverage is only half the problem in the United States. The other is the cost of medical care, even with insurance. Anna Koenig, 32, a financial executive for a tech start-up in San Francisco, said she went to get an M.R.I. for headaches and was shocked to get a post-insurance bill for $1,200. “I’m lucky because I have insurance,” she said. “But I have a lot of friends who are in medical debt.” One third of Americans say they are likely to delay or skip medical care because of cost, far more than any other country, according to Petersen-KFF’s Health System Tracker.

The United States spends almost one-fifth of its gross domestic product on health care, the most in the world, and yet its residents have a lower life expectancy, 78.6 years, and a higher chronic disease burden, 28 percent, than those of any other Western democracy, according to the Commonwealth Fund.

How to expand health coverage while containing costs is one of the great unanswered questions in American politics. And the search for answers has not been made easier by the current pandemic, pouring oil on the fire of an election season in which health care already was a major issue. The crisis may mean that as many as 35 million people who have lost their jobs will also lose their health care plans, increasing the total number of uninsured Americans to over 60 million.

The coronavirus has exposed shortages of beds, gowns, face masks, ventilators and other essential medical supplies. Some emergency workers do not have health insurance. Hospitals that can no longer accept as many profitable patients for elective procedures as they used to are, paradoxically, losing money during a health crisis, and have laid off doctors and nurses. The pandemic could cost hospitals and insurers over $500 billion, and the federal government has already made over $100 billion in bailout money available to hospitals.

Both the U.S. Catholic bishops and the Catechism of the Catholic Church have described basic health care as a human right.

Bernie Sanders urged the Democratic Party leftward, toward the creation of universal public insurance, in strong 2016 and 2020 campaigns. In his Medicare-for-all plan, he essentially proposed nationalizing American health care and wiping out the private insurance industry.

Former Vice President Joe Biden, the party’s likely nominee in this November’s election, has recommended instead maintaining the current system but including “a public health insurance option like Medicare” that would help bring down costs by competing with private insurers.

President Trump still wants to repeal the 2010 Affordable Care Act and has argued that the fix will be found in inviting the free market to work its magic within the current system in the United States, which is based largely on private insurers. Last year, the Trump administration also enacted a rule forcing hospitals to be more transparent about prices.

Both the U.S. Catholic bishops and the Catechism of the Catholic Church have described basic health care as a human right, but Americans remain divided about the best way to provide it. Public opinion in the United States has shifted toward nationalized health insurance. Last year, over 60 percent of Americans polled by the Kaiser Family Foundation backed a Medicare-for-all style plan. The idea has enjoyed majority support since 2016, Kaiser said. “And there’s nothing like a pandemic to amplify the weaknesses in our heath care system that already exist,” said Caitlin Donovan, spokeswoman for the National Patient Advocate Foundation. “We have the most confusing and overpriced health care system in the world.” The pandemic, she said, “has taken the stigma out of the safety net.”

But one thing the majority of health care experts agree on is that the political and economic reality of the current U.S. health care system precludes a reform like Medicare-for-all, deeming it too expensive and politically unfeasible. “If we think we can go back to the way things were, we’re tone deaf and blind,” said Mary Haddad, R.S.M., the chief executive officer of the Catholic Health Association, which represents 600 hospitals and 1,600 long-term care and other health facilities in all 50 states. “This is a transformative moment, but we have to be politically realistic. We need universal coverage, but I don’t see us dismantling [the current system].”

The crux of U.S. health care’s tangled web is that Americans have come to expect their employers to subsidize their health insurance.

Unfortunately for Mr. Sanders and his supporters, canceling a uniquely American system that privately insures 150 million people and sustains a Germany-sized economy of hospitals, doctors and drug companies is impossible to imagine. The scale of necessary destruction and rebuilding is why Senator Sanders’s plan was estimated to cost over $30 trillion and why it failed to garner support from most other Democratic leaders.

Is a Public Option Possible?

What is realistic is some kind public option plan for people like Ms. Winslow, who cannot afford A.C.A. coverage and who do not qualify for Medicaid or Medicare. Ideally, such a plan would also force insurers, hospitals and drug companies to offer competitive services and costs.

If Joe Biden is elected, health care experts and managers say a realistic outcome might be something like Medicare Extra, a plan published in 2018 by the think tank Center for American Progress, which would offer a public option based on the principles of Medicare. The C.A.P. points out that “health systems in developed countries use a mix of public and private payers and are financed by a mix of tax revenue and out-of-pocket spending.”

At the center of the U.S. health care’s tangled web is the fact that Americans have come to expect their employers to subsidize their health insurance. But this model excludes the millions of people like Ms. Winslow, who work low-wage service jobs that do not offer health benefits, and forces others to hang on to unproductive, unhappy work. Roughly half of all Americans depend on their employers for coverage, while 20 percent depend on Medicaid and 14 percent on Medicare.

As Steven Brill lays out in his book America's Bitter Pill, during the Second World War, as wages stagnated, employers recruited workers by offering health care benefits. Around that time, a ruling by the I.R.S. that these benefits would not be taxed as wages created another incentive for employers to pay for private health insurance. The number of Americans with employer-paid health insurance boomed. Basically content with their employer-paid private plans, a generation of Americans was happy to say no to European-style health care reform, even as costs exploded upward.

The pandemic has challenged health care systems around the world in different ways, but in the United States, it has exposed four big problems.

In the economic boom that followed World War II, Europe embraced the government’s role in managing health care, but in the United States hospitals, doctors and insurers were running a business, not a public service. They charged high prices with good profit margins and peddled their services on billboards just like companies selling Buicks, Barbies and Budweiser. Among other things, the high prices locked in by private companies meant that public reform efforts like Medicare, Medicaid and current initiatives proposed by Mr. Sanders and Mr. Biden are doomed to cost much more than they would in other countries.

In many ways, the United States has become a leader in health care, thanks in part to the large sums of money moving around the system, including the willingness of the richest members of society to pay astronomical sums for surgery. The country also has a network of strong research universities that foster the type of developments required to become the best in the world in areas like intricate cancer treatments and other complicated surgeries. The United States excels in high-quality advanced medical procedures and elective surgeries. It has the highest rates of hip replacements and breast cancer survival in the world.

The problem is that this kind of business-led health system does not do a good job treating everyday ailments that are far less profitable to treat but could one day turn into bigger problems. Among the consequences is a huge class of people, many from minority groups, with obesity, diabetes and other conditions who are dying from Covid-19 at higher rates than higher-income people with better health care.

The pandemic has challenged health care systems around the world in different ways, but in the United States, it has exposed four big problems.

As a rule, U.S. hospitals, both for-profit and nonprofit, are sustained by expensive and complicated procedures that allow them to stay in business and pay their bills.

As a rule, U.S. hospitals, both for-profit and nonprofit, are sustained by expensive and complicated procedures that allow them to stay in business and pay their bills. “That’s a weakness, because it means our system is oriented toward reaction, not prevention,” said the Rev. Charles Bouchard, a director for the Catholic Health Association. That is why hospitals dependent on expensive elective surgeries that are not possible during the pandemic have been bleeding cash during this time. In Europe, said Dr. Jennifer Kates, the director of global health for the Kaiser Family Foundation, “primary care is more available so you can attend to preventive care. Things like diabetes and hypertension should be treated on a preventive basis.”

A second issue is that U.S. hospitals often want their doctors and nurses to churn through patients as quickly as possible, which they can no longer do during the pandemic because people with ordinary ailments are staying home. “Normally, you’re trying to see as many patients as possible so your clinic gets paid,” said Kristen Connelly, a 29-year-old traveling nurse practitioner currently based at a hospital in California. “It incentivizes you to see 10 patients an hour and bill for all of them.” On a good day, she said, “I saw three patients an hour. That left me five minutes to review charts and previous tests, then 10 minutes to see the patient, then five minutes to chart. And when somebody has something complicated, you want to be interested, but you don’t have time to be interested.”

Third, the free market, which is supposed to secure lower prices and better service for consumers, has a limited impact on health care. A few years ago, I crashed my bicycle and tore a hole above my lip. I called 911. My insurance company was billed $1,100 for a 10-minute ambulance drive to the hospital and $3,000 for nine stitches. With a busted-up face and no small level of panic and anxiety, I had no negotiating power to shop for prices and no choice but to submit to whatever form of monopolistic price-gouging was on offer. (They did do a nice job on my philtrum; no complaints.) Now, if you catch Covid-19 and call 911 because you have trouble breathing, you will have even less chance of negotiating a fair price.

And finally, hospitals invest and spend large sums on medical solutions to end-of-life care, which is profitable but often has limited human value and does not create the widespread health a nation needs to withstand a pandemic. The United States spends 10 percent of its total health care budget on end-of-life care. In essence, it spends as much money on the last month of a 90-year-old’s life as on the first 20 years of a young person’s life.

We’re facing the hardest period for health care costs over the next 20 years as the baby boomers get older.

“We should make palliative care a national area of education,” said Kevin Sexton, former chief executive officer of the Maryland-based Holy Cross hospital network, and current board chairman of the Catholic Health Association. Sometimes, at the end of life, “we’re just torturing people.” This is an area “where religious and faith leaders could play a huge role in talking about dying with dignity.” The upshot is that even if the United States has improved coverage in the past decade, “nobody’s come up with a good way to bend the cost curve,” said Mr. Sexton. “And now we’re facing the hardest period for health care costs over the next 20 years as the baby boomers get older.”

Counting the Costs

Because the United States is so big, with so many interlocking systems and interests, administration costs are high, five times those of Canada, for example. Doctors pay hefty bills for medical school and then need high salaries to practice while paying off their loans. Those factors help explain why the United States has among Western countries the highest number of hospital employees per 1,000 people, 20.1, but among the lowest number of doctors, 2.6, according to Kaiser.

Most of these costs are locked into the system and can only be reduced gradually, say heath care leaders. “Do I believe we’re going to have a national insurance model?” said Dr. Richard Vath, president and chief executive officer of the Franciscan Missionaries of Our Lady hospital system in Louisiana. “I think it’s certainly possible, but I don’t think we’re going to have a governmental plan with insurance for all.”

To be sure, it is appealing for Americans to look at other countries and wonder: Hey, why can’t we have that? Laura Kaiser, president and chief executive officer of the St. Louis-based SSM Health, a Catholic nonprofit system, told me she likes to study health care models in other countries. “When I went to Cuba, what I saw was a country that’s economically poorer, but what it does well, it does better than us.” People are channeled to a primary care clinic, she said. “And there’s a physician, a nurse and a statistician assigned to every community, and they keep track of people, and if they haven’t seen you, they will come and find out [how you are doing].”

There has to be a conversation about how we can get basic care for everybody.

But, as Ms. Kaiser herself pointed out, the United States does not work in the same way as other countries. Reform “has to be bipartisan,” she said. “There has to be a conversation about how we can get basic care for everybody.”

We in the United States are not going to suddenly embrace Marxism or socialism as a society. We are the country that unleashes capitalism to build companies like Disney, McDonald’s and Facebook. That means that any reasonable solution likely has to work itself out through the world of business and its incentives.

Already, the coronavirus is focusing the industry on some hard truths that could save money, including spending more on preventive care, remote medicine managed online and the delicate issue of end-of-life care. Medicare is offering more telehealth services.

What hospitals can and should do, said Dr. Vath, is manage costs by investing in treating people before they need expensive procedures. For example, hospitals could do surgeries in “ambulatory centers instead of at the hospital”; these are less expensive because they do not include a hospital’s costly infrastructure of beds, equipment and staff. The pandemic, said Dr. Vath, “is going to change health care forever.”

The best example for reform may be in private initiatives like that of Dr. Timothy Wong. After getting his medical degree in Pittsburgh, the Toronto native grew frustrated working in a regional hospital. “This was not what I went to med school for,” he said. “I was spending my time filling out paperwork and not helping anybody.” What health care is, he said, “is just a conversation between a patient and a doctor, so I thought, why not just strip out” the administrative costs of running a hospital or insurance company.

I was spending my time filling out paperwork and not helping anybody.

In 2019, he set up a clinic on the east side of Pittsburgh, a historically minority neighborhood, where he offers consultations for $35. He does not accept insurance and employs only himself. It is a for-profit venture, because he wants the model to be attractive and replicable elsewhere. “Most patients don’t have insurance, so there are no forms to fill out,” he told me. Instead of ordering expensive tests, he tries to treat the underlying disorder, which is often anxiety or post-traumatic stress syndrome. The big flaw in the U.S. health care system, he said, is that it does not admit that “doctors rarely cure anything. We put things in remission. The only thing we really cure is infections, with antibiotics.”

Dr. Wong does not think that Medicare for All can work in the United States because it would be too complicated, expensive and disruptive, throwing millions of insurers and administrators out of jobs. “What you can do is innovate and slowly improve,” he said. Dr. Wong grew up in Toronto, and his wife is from the Philippines. They are both familiar with the small neighborhood clinics where “it doesn’t cost $150 to manage your cold medications.” The pandemic has shrunk his business 80 percent. “People are afraid to come in, but we’ve shown there’s demand [prior to the pandemic],” he said. In the first nine months, his clinic saw 1,900 people.

A New Plan?

Even in better times, it remains unlikely that a clinic like Dr. Wong’s will show up in every neighborhood. And the health care situation in the United States demands change now. The current system clashes with American public opinion, the culture of Western democracies and Catholic social teaching.

In a 2018 speech to the World Health Organization in Geneva, Archbishop Ivan Jurkovic, permanent observer of the Holy See to the United Nations, called for “stronger and sustainable primary health care toward achieving universal health coverage.” In the United States, it was groups of Catholic women religious that set up some of the first health care facilities. Small government that does not include decent health care management “is antithetical to Catholic social teaching,” said the Rev. Charlie Bouchard, the C.H.A.’s ethicist.

The reality of Washington in 2020 is that any reform effort will face pushback from one of the world’s most powerful lobbying coalitions.

Now, as the national elections approach, Democratic strategists are planning on ways to tinker with Mr. Biden’s plan. Already, the former vice president has proposed lowering the qualifying age for Medicare to 60. Whatever they propose, the reality of Washington in 2020 is that any reform effort will face pushback from one of the world’s most powerful lobbying coalitions, skilled at combat in crushing health care reform efforts.

I contacted representatives of the lobbies for doctors, hospitals, insurers and drug companies for this story. Only the lobby representing health insurers, America’s Health Insurance Plans, got back to me. “Crises always produce opportunities for change,” said Bill Pierce, a director at APCO, one of the world’s biggest public relations firms, which represents AHIP. “But it’s not always good change.” One change the insurance industry might support, he said, is paying for more online health meetings, so-called telehealth.

“In an environment where health care providers are doing heroic things, it may be harder to say hospitals are getting paid too much, even if they are getting paid too much,” said Matthew Fiedler, who studies health care for the Brookings Institute.

Often a crisis, like the current pandemic, can result in new pathways for big policy changes.

But here is the hope: Often a crisis, like the current pandemic, can result in new pathways for big policy changes. The Great Depression in the 1930s gave the United States Social Security and the New Deal. In Britain, World War II begat the National Health Service. The 2008 recession paved the way for the Affordable Care Act. The depth of pain caused by such widespread events forces societies to look at things differently, to reconsider their political and cultural assumptions.

There are signs that this is happening now in the United States. The pandemic is changing our collective attitude toward government and the notion of public service. Washington, with bipartisan support, is bailing out small businesses and sending cash to citizens. Landlords are waiving rents, and utility companies are waiving bills. Nonviolent prisoners, locked up for drugs or prostitution, are being released.

Trying to reform health care has long been a ritual for modern presidencies. Franklin Roosevelt and Harry Truman tried to offer national health care, but fears about slipping into communism and opposition from doctors’ lobbies undermined these and even earlier efforts by unions.

President Lyndon Johnson managed to create Medicare for people over 65 and Medicaid for the poor, and Barack Obama the Affordable Care Act, which, among other things, guaranteed health care to people with pre-existing conditions and subsidized the purchase of private insurance. The A.C.A. managed to shrink the number of uninsured Americans from 46.5 million in 2010 to under 30 million.

One almost-certain outcome of the pandemic is more power for the federal government to manage public health, if it is willing to do so. Unlike other countries, the United States does not have a national ministry of health that can coordinate a national response plan. “We’ve got public health on a starvation diet at a moment when we need something more robust,” said Mr. Sexton, the C.H.A. board chairman. A key question for future planning is how to coordinate a federal response to health emergencies: “How do you build surge capacity,” said Dr. Kates of Kaiser. “What is the proper way to make it so you’re not scrambling and having to ship things from one part of the country to the other.”

Patient advocates say they are cautiously optimistic that the pandemic will refocus attention on what matters, the health of human beings. “We shouldn’t be trying to change our patients to satisfy our system,” said Ms. Donovan, the patient advocate. “We should be trying to change our system to satisfy our patients.”

Correction, June 1, 2020: An earlier version of this article incorrectly stated the title of Steven Brill's book. The correct title is America's Bitter Pill.

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