Two Florida Hospital systems — as well as the Cleveland Clinic, Mt Sinai and Johns Hopkins — have been in a contract war with Blue Cross and Blue Shield for almost six months. The failure to arrive at a mutually agreeable financial compromise has led to patient care disruption, delays and massive unhappiness. Regrettably, the patients, who have little control over their care, become victims. Alternatives are poor since each insurance carrier has their own panel of physicians and hospitals, unknown and often undesirable to the patient. Although they pay staggering premiums, patients are expected to silently endure inconvenience and mind-numbing frustration.
A more profound and fundamental question can be asked: Is health care a right or a privilege? That question has been ignored as medicine devolves further into the corporate world of profitability. While enormously successful, Medicare/Medicaid were passed in 1965 but were soon bastardized by HMOs and Medicare Advantage Plans. Privatization of Medicaid programs allowed entrepreneurs to reap obscene profits at public expense. President Trump, perhaps the quintessential businessman, asked the question in November: “Why are we giving all this money to insurance companies?” Or more accurately, he stated: “The giant sucking sound of money going from Americans’ wallets to health insurance companies bank accounts.” This will end if he has his way. The country is waiting.
Adam Smith and the Wealth of Nations
In 1776, simultaneous to a minor disturbance in one of the English colonies, Adam Smith published a document considered to be the bible of capitalism. An Inquiry into the Nature and Causes of the Wealth of Nations shares a 250 birthday with our nation. Among his statements are that greed is good and “hate the Lord thy God, damn his laws, and covet thy neighbor’s goods,” according to The Economist. Yet, as the corporatization of health care continues to expand, its deficiencies become increasingly evident. Profitability replaces professionalism. The essence of care (returning patients to an improved level of health) falls further into obscurity. Smith writes: “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own dinner.” It is hard to see how this squares with the goals of the medical profession.
Few of us would dispute that having tried everything else, capitalism is the most successful economic system in the world. Capitalism has produced not only wealth but raised the standard of living for most of the world’s population. Yet the laws of capitalism cannot be uniformly applied to medicine. In capitalism, there are winners and losers. In medicine, we bury the losers. Even Smith acknowledged the need for government to provide education and approved of caps on interest rates. He likely would have approved of a regulatory agency to prevent gouging. We can speculate that if he were alive today: Would he consider health care a right or a privilege? Should government consider health care a public service?
Health care insurance
Recognizing the vast amount of money flowing into health care, corporations seriously entered the arena roughly 40 years ago. Insurance companies and hospitals expanded, gobbled up competitors and used well-established marketing principles to create monopolies. Although Medicare/Medicaid are their only real competitors, they soon found a way to wiggle into those programs. HMOs were born. When, in the 1990s, HMOs were recognized as a vehicle for denying care and patients reacted with outrage. Since re-branded as Medicare Advantage Plans, their conduct is substantially similar to HMOs. Larger insurance companies’ profits are “outrageous” and patients again complain about prior authorization delaying or denying operations, scans and expensive medications. Luigi Mangione’s violent assassination of United Health Care president Brian Thompson exposed the degree of patient frustration to the point of erecting a shrine for him on West 54 St. in Manhattan. There was little sympathy for Thompson, a sentiment that seemed to befuddle both insurance companies and national leaders.
Hospitals
It is no wonder that health care insurance companies are at war with hospitals who similarly have consolidated to maintain profitability. Although many states mandate cost transparency, this goal is as opaque as milk, with MRIs costing $20,000 plus $2,000 facility fees. As care givers of last resort, hospitals have become burdened with patients whose families have no ability to care for a frail loved one, a genetically deformed premature baby, the homeless and the mentally destitute. Hospitals prosper in a Robin Hood environment of stealing from the richly insured to provide care of the poorly insureds. With nursing home care abysmal (an industry also beset by private equity firms seeking greater profitability) societies’ human detritus lies marooned in hospitals while social workers scramble to find a bed.
And that leaves poorly funded rural (and inner city urban) hospitals financially unsound and closing at an alarming rate. Recent data shows between 2015 and 2020, 135 hospitals closed in the U.S. — 73 rural and 62 urban. In 2023, 18 general acute care hospitals closed. In 2024, 16 hospitals closed due to financial instability and evolving health care models. Increasing their burden is a lack of doctors. The doctor gap formally was made up from foreign medical graduates, but recent government policies have disabled H1B and J1 visas. Midlevel nurses are left to provide care. The question is asked: If a patient in rural Oklahoma has a medical emergency, are they better off going to a local hospital five miles away, staffed by an ARNP, or driving 75 miles to a major medical center? Likely the former since patients can be stabilized and evacuated, akin to military medicine.
Big pharma
Pharmaceuticals soon followed. Although primary research is performed and bankrolled by the United States, manufacturing is done elsewhere, including Europe and China for far less money. President Trump brought the drug makers into the Oval Office and pressured them to lower prices. They did. TrumpRX has 43 medications available. Medicare/Medicaid patients cannot use insurance or coupon cards. According to Managed Healthcare Executive, Eliquis was lowered 56% to $231 per month; Embrel for arthritis went down 67% to $2,335 per month; Entresto for heart failure was reduced 53% to $295 per month; and if you have blood cancer, Imbruvica went on sale 38% to $9,319 per month.
Cheaper yes, affordable no.
Glucagon-like peptide-1 (GLP-1) receptor agonists have the potential for saving thousands of lives only to be available to those with the resources to afford it. GoodRx and other discounters sell this medication for about $399 per month. Similarly, Daraprim, EpiPens, insulins, Dilantin and common medicines had been around for years only to see their cost wildly inflated. But then, why do GLP-1 drugs cost 500% more in America than they do in Europe?
Corporations corner the market and pass laws to protect themselves under the guise of protecting the patient. Capitalism can be effective when GLP-1s can be purchased from China (illegally) as a powder and prepared by the patient for $50 an injection. During a shortage, compounders were very successful selling a much less expensive GLP-1 (with another additive). That privilege was hastily revoked when the government determined that there was no longer a shortage (compounders are currently in litigation).
Laissez-faire capitalism does not work in medicine. It might, if there was an even playing field or if we could import pharmaceuticals from abroad. Neither seem likely to happen. America is not ready to accept health care as a privilege when ignoring disparities in affordability and accessibility. Regretfully, patients are forced to pay twice as much for their health care as any other developed country while accepting very poor outcomes — about 36th worldwide in life expectancy and insufferable frustrations.
In Part II we will discuss Physician responsibility. What can doctors do?
