Articulated Explanation of Benefits of the U.S. Health-Care-Industrial Complex and Obamacare!

Summary of the article “Bitter Pill: Why Medical Bills Are Killing Us” by Steven Brill (Time magazine, Feb 20, 2013) 

1. The U.S. health-care facilities (hospitals, medical centers, etc.) are mostly owned by anonymous financial business entities from Wall Street (like private-equity groups). The latter use various umbrella organizations and front groups to run medical centers, hospitals, and other medical facilities.

2. Hospitals are the most politically powerful institution in any congressional district. Their position is usually solidified as that of community’s most important charitable institution, and their influential stakeholders determine economic policies of medical equipment manufacturers, drug companies, doctors, and rank-and-file employees. Hospitals are consolidating by buying doctors’ practices and competing hospitals, their leverage over insurance companies is increasing.

3. The U.S. health-care-industrial complex’s economic policies have become in effect an extension of the corporate finance capital's activity. The revenues, profit margins, and net profits of most of the local medical centers and hospitals (nonprofit as well as for-profit) exceed those in other sectors of the U.S. economy.

4. The U.S. health-care-industrial complex’s operations and transactions (between medical centers, hospitals, pharmaceutical companies, medical devices and durable equipment manufactures, insurance companies, and doctors) tend to be underregulated, in the same way the operations in the financial sector are. The culture of that lack of regulation and oversight, especially with regard to disproportionate pricing, outsize profits, and excessive compensation, is getting increasingly characteristic of the U.S. hospitals and medical centers just as in the financial sector.

5. Drugs and medical equipment producing companies, along with the major medical facilities (medical centers, hospitals, etc.), have been freely pursuing their policies of unrestrained prices and profits under the pretext that it is necessary to fund the risk taking of research and development. Because of heavy lobbying, Congress prohibits the Centers for Medicare and Medicaid Services (CMS) of the Department of Health and Human Services from negotiating prices with drug makers, medical devices and durable medical equipment manufacturers. It also prevents any legislative measures, which could be construed as mandates for practice guidelines, coverage recommendations, payment, or policy recommendations.

6. The U.S. health-care system reform program, the so-called Obamacare, which intends to bring new customers into the market by mandating their health insurance and then providing taxpayer support to pay their insurance premiums, is most likely to create conditions necessary for greater hospital consolidation. Dominant hospitals and their doctors will have a greater advantage over the insurance companies, which will lead to greater health-insurance costs. The result would be ever higher (close to chargemaster list) prices for health-care products and higher profits for the health-care-industrial complex with their anonymous hospital-owning bankers and private-equity groups from Wall Street at the top of this food chain. At the bottom of this pyramid are going to be the ordinary taxpayers, of course, providing their taxpayer support through Obamacare.