The 1990s are truly the golden age for healthcare industry executives and investors. But now we have come to a critical crossroads that endangers not only patients, but the very viability of a system that has produced such enormous wealth.
Healthcare restructuring, like managed care before it, rode in with promises of improved quality of care and lower costs. But the seamy underside has been exposed.
During last year's campaign on behalf of California's proposed Patient Protection Act, or Proposition 216, the California Nurses Association and Ralph Nader's consumer colleagues in California, the Foundation for Taxpayer and Consumer Rights, collected and distributed HMO Casualty of the Day reports. These reports documented the pain and suffering felt by the very real victims of the cost cutting the industry touts as a grand success.
One 4-month-old infant died after an HMO delayed approving a simple $50 to $150 test. Another child died after a "surgical misadventure" at an HMO; the coroner's report quoted physicians as noting a lack of safeguards and precautions at the HMO. A woman with a massive pulmonary embolism died after waiting untreated for more than six hours in an HMO emergency room. Another woman died after the HMO for which she worked as a saleswoman refused to authorize a bone marrow transplant her doctor recommended.
Far more evidence exists than do anecdotes. A Journal of the American Medical Association study found that managed care is all right-unless you are sick, old or poor. According to a recent Harvard University study, not only is the number of people without health insurance rising, but even those already insured are having a harder time paying medical bills as employers cut benefits. A 1995 Robert Wood Johnson study found managed-care patients are 40% more likely to report problems getting needed treatment, diagnostic tests and access to specialists.
Managed care is part and parcel of an industry transformation in which resources have been diverted on a massive scale from the provision of care to the pursuit of profit. And we are not talking about small change.
Readers of these pages are probably aware of the high rolling under way in the healthcare industry. The Center for Healthcare Industry Performance Studies, Columbus, Ohio, recently found that the financial condition of U.S. hospitals has never been better, with return on investments in 1995 higher than any of the previous four years. There is much hand-wringing about the "overcapacity" in the system, yet somehow Columbia/HCA Healthcare Corp. seems to think the empty beds are valuable enough to have spent as much as $356,000 per bed to buy up hospitals during part of 1995.
And the wealth has been spread around, at least in corporate board rooms. Two pharmaceutical companies, McKesson Corp. and Amgen, had respective five-year growth rates of 30% and 43%. Two HMO giants, Health Systems International and PacifiCare Health Systems, reported respective growth rates of 50% and 43%. That's not to mention the staggering riches forked over to individual executives. Healthcare executive compensation has grown 83% in this decade; the top 23 hold about $7 billion in stock, enough wealth to supply funding for AIDS research at 1995 federal levels for five years.
Millions of people are starting to notice the disparity between these vaults of wealth and the steady erosion of patient-care standards and the shredding of our healthcare safety net.
In California, we are standing at the crest of a wave that is crashing across the land. Consumers and caregivers are in rebellion against a healthcare system that looks and feels like an autocratic nightmare. Healthcare decisions are increasingly concentrated in the hands of a small number of grotesquely rich men who run HMOs, health systems and other conglomerates with budgets that dwarf the treasuries of many nations, while patients are routinely denied the most basic services they pay for and deserve. Our elected leaders have distinguished themselves in health policy primarily by abdicating public policy to the market.
Last year, California nurses took a bold initiative, coalescing with Nader and other healthcare consumer advocates and community organizations to craft Proposition 216. We campaigned up and down the state for the return of healthcare decisions to doctors, nurses and patients; for dislodging many of the financial incentives that now drive care delivery; and for restoring some of the healthcare industry's abrogated wealth to our communities. While the initiative did not pass, it did garner the support of nearly 40% of the voters. This was despite the confusion engendered by the appearance of another similar, but weaker, measure on the ballot and the very costly campaign waged by our opponents in the healthcare industry.
However, our coalition, our advocacy for patients, and our challenge to corporate and assembly-line medical care will live on.
The CNA will continue to uphold and defend nursing practice standards in a rapidly changing healthcare environment. We will expand efforts to alert the public to the threats arising from the steadily advancing corporatization and commercialization of healthcare delivery. Our efforts will unfold in the regulatory and legislative arenas, at the bargaining table and in the court of public opinion. Last year, nurses emerged as a dynamic and weighty political force in our state. The CNA will press forward relentlessly to advance the public interest regarding access for all to safe, high-quality healthcare.
The choices before the public are increasingly clear. We will either have a democratic healthcare system that operates in the public interest or one that is the private playground of a small elite while a healthcare crisis threatens to explode. In the 1890s, anger over the monopolization of industry and the correlating corruption of the political process engendered a generation of muckrakers, the flowering of a populist movement and the nation's first antitrust laws and Progressive Era reforms. When history looks back at this era, how will we have answered the current challenge?