An article in the Harvard Business Review that acknowledges the dilemma many of the for-profit hospitals in the US are now facing sees the solution in an appeal to the insurance companies that dominate the American health care economy.

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The authors, Sean Nicholson and David A. Asch, write: “In order to divert resources to the patients in the greatest need — and to protect the safety of the patients who can wait — hospitals are also postponing non-emergency care, cancelling elective procedures and, in general, halting the very activities that used to keep them in business.”

Here is today’s 3D definition:

Elective:

In the consumer society, anything that justifies a high mark-up price to maximize profit

Contextual Note

Health care in the US is incredibly expensive and at every level. The care itself is expensive, and so are medical acts and drugs. They have to be, not because they can’t be made less expensive, but because health care has become an essentially for-profit industry based on the habits of the consumer society. Rather than being dedicated to the care of the sick — because many hospitals, even nonprofits, are run as businesses — they prefer elective surgery to basic care as it’s more profitable.

People are willing to pay more for what they want than what they need. In 2017, Stanford Medicine published its analysis of the causes in an article with the title: “Insurance policy — How an industry shifted from protecting patients to seeking profit.” The central role of insurers, who handle the money, guarantees that hospitals will focus on revenue and profit before considering patients’ needs.

The authors of the Harvard Business Review article on the dilemma hospitals are facing as they confront the consequences of the coronavirus pandemic explain: “Our hospitals are facing a financial crisis just when we need them the most during this unprecedented health crisis.” Hospitals depend on payment by insurers for their revenue in the US system. The insurers are private companies that control the money that goes to health care service providers. Nicholson and Asch emphasize a small but significant detail that most people forget: the money in the coffers of the insurance companies is not properly speaking their money, to deal with as they please. “Health insurers manage our premium dollars.” To bring home the point, they repeat: “Insurers are the stewards of our money. It isn’t their money.”

The authors suggest a simple, straightforward way of dealing with the potentially dangerous financial vulnerability of hospitals. Their elegant solution would ensure the continuity of service for hospitals facing increased pressure in response to the pandemic. It very simply consists of getting the insurers to provide, at the first of the month, the same amount of cash the hospitals receive from them in any month of normal activity. The cash would not be tied to specific billing, which also eases the administrative load and expedites the care given by eliminating red tape.

Nicholson and Asch point out that the “insurers have already budgeted this money and have already collected it,” so it would in no way disturb their normal financial management. In other words, it’s a win-win. The insurers’ cash flow is preserved and care takes place without complication or interruption. The detailed accounting can be handled later, with input from the government in the framework of the bailout plan.

The authors are right. It is possible to adjust the logic even of a sophisticated neoliberal health care system built for maximizing profit that could, for the duration of the crisis, adapt its practices to responding to urgent needs while putting elective procedures on temporary hold. But alas, like many solutions that, while both rational and feasible, represent a change of method, there is little likelihood that insurers will be tempted to implement it. One reason is that it’s too simple and logical. There must be a catch. And the catch the insurers are most likely to discover will be their fear that implementing it could set a dangerous precedent. People might notice how unnecessary, costly and even disruptive their role in the system is when other choices are possible.

The authors point out that their proposed solution could nevertheless be seen as financially beneficial to the insurers themselves as it would take the form of a “windfall” thanks to “reduced costs from other care foregone.” It would also be good PR. By efficiently responding to people’s and the health care system’s actual needs in a crisis, the insurers would maintain or increase their otherwise waning credibility and possibly hold off their worst nightmare: the threatened adoption of a single-payer system, which would mean money for standard health care needs would no longer pass through their hands.

If they had any sense, the insurers would scrupulously follow the Harvard Business Review’s advice at this extraordinary moment in history. The coronavirus pandemic has already exposed to the light of day some of the darker practices of an industry that milks profit from people’s unhappiness. Thanks to the pandemic many people — especially those who are losing their jobs — are beginning to understand how simpler it would be if single-payer health insurance existed in the US and how dangerously chaotic, unreliable and inefficient the current private insurance system is. Just last week, 3.3 million lost their jobs in America and will find themselves at the end of the month brutally deprived of the private health care schemes that certain presidential candidates have recently insisted were too valuable for people to accept to “give up” in favor of single-payer health care.

However rational the solution proposed in the article may be, there’s a simple reason why it won’t be adopted. Just like medical acts themselves from the point of view of individuals, implementing workable solutions for the health insurance industry is elective. It’s something they choose to do following the dictates of their short-term interest. Implementing this solution would require focusing on the needs of the insured rather than the goals of the insurers.

Interviewing a 63-year-old now out-of-work restaurant server about politicians and business people who “tend to focus on the bottom line rather than people like him,” The Los Angeles Times asked the man if he thought they might, this time around, take into account his and other people’s dilemma. His answer was simple and to the point: “They’ve never really had our interests at heart. And now would be a weird time to start.”

Historical Note

Though it is not a sentient being and cannot make decisions, the novel coronavirus — which causes the COVID-19 disease — has become a major actor in this young century’s history. US President Donald Trump insists on calling it the “Chinese flu” to give it a nationality and play to the instinct for xenophobia in US culture. It worked when he equated Mexicans with rapists and drug dealers, which got him elected in 2016. But the coronavirus has neither good nor evil thoughts in its nonexistent brain, though some may think of it as the Genghis Khan of the 21st century, conquering everything in its path.

Historian and Columbia University professor Adam Tooze, interviewed by Vox’s co-founder, Ezra Klein, about the nature of the current crisis, reminds us of a principle that the insurers in the health care industry might want to heed. Assessing the Chinese campaign to stifle the spread of the virus, Tooze remarks: “The Chinese Communist Party are the truly conservative ones right now. They recognize that everything has to change so that everything can stay the same.”

According to Tooze, the Chinese took the radical decisions that halted the COVID-19 outbreak because they were focused on protecting their own status quo. In the US, the hesitation that consists of trying to save the economy at the same time as countering the virus will undermine the status quo and lead to more instability. This leads to the paradoxical realization that recognizing the need for change and applying novel solutions is the key to establishing a new status quo and avoiding revolutionary chaos.

Tooze doubts whether the current leaders in the US are capable of understanding that kind of historical logic, even though it would work in their self-interest. Just as it’s unlikely that insurers will adopt measures designed to protect their privileged role in the health care economy — because that would be inconsistent with their generally predatory behavior — Tooze doesn’t expect Trump to follow his advice. He chalks it up to a failure of imagination: “The ultimate perversity is that their inability to imagine a future will not enable them to return to the pre-crisis situation.” At one point, Tooze describes the Trump administration as “a headless chicken.”

For all the damage the COVID-19 pandemic has already done and will continue to do in the coming months, and despite serious cases of misjudgment and mismanagement, many lucid commentators across the globe hope that the governments and the populations of democratic nations will emerge from the crisis with a clearer idea of how their health care systems should be structured, organized and managed.

This is certainly the case in Europe, where in recent decades the neoliberal trend in economic thinking has led to hospitals being managed as businesses rather than public services, to the detriment of both health care workers and citizens covered by universal health care. In France, in particular, this has led to a prolonged crisis that may now find a resolution thanks to the current panic, perceived at the highest levels of government as a wake-up call. 

French President Emmanuel Macron appears to have taken on board the lesson. He has called into question the idea that health care should be managed as a business. He has specifically endorsed the idea repugnant to all neoliberal thinkers that the government’s first duty is to support and reinforce the welfare state. The ultimate lesson as it is playing out for most Europeans is not only that health is a collective responsibility and that it precedes as well as undergirds the economy, but that the economy itself — and the so-called iron-clad laws economists have consistently insisted on to justify austerity — can no longer be thought of as something that is independent of everyday human needs.

In the coming years, perhaps for the first time in decades, economists will feel morally obliged to engage with philosophers and ethicists in a serious project aimed at redefining the role of both governments and powerful economic actors. At some point in the coming months, the drama of the coronavirus will eventually fade from the headlines. But rather than a simple return to the status quo, that is when the parties to this new dialogue will be able to focus their attention on the next big issue, much bigger in fact than COVID-19: climate change.

*[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news.]

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.