Philip R. Lee’s 1986 Call for National Health Insurance

May 4, 2024

This Date in UCSF History: National Health Insurance Ahead?
UCSF Student Voices
Synapse
April 23, 2024

(Originally authored by Dr. Philip R. Lee — a UCSF professor of social medicine and director of the Institute for Health Policy Studies — and published in Synapse on April 24, 1986.)

Twenty years ago, states throughout the country began to implement federal legislation (Title XIX, Social Security Act) establishing a national program for medical care for the poor (Medicaid). In the same year, 1966, the federal Medicare program began providing hospital and medical insurance for the elderly.

With these two public programs, the public sector began to fill the major gap in private health insurance.

Private health insurance was largely provided on a group basis, through employment, with employers paying the bulk of premiums.

In the 1960s and early 1970s the idea that access to health care was a merit good or a right of citizenship was widespread.

It seemed only a matter of time before the remaining gaps would be filled by universal health insurance, albeit with a mixture of public and private payment mechanisms. 

In the 1970s and early 1980s, as costs of health care rose rapidly and as efforts to contain costs seemed ineffective, the idea took hold that national health insurance was impossible and that health care was not a merit good.

Instead, many advocated that health care should be treated like other goods and services, and that price competition and the marketplace should be the primary approach to resolving the problems of cost, access and quality. 

Policies established by Congress and the Reagan administration have strongly supported this approach.

Many states, including California, have adopted pro-competitive policies. The results of the recent policy changes have been mixed.

The rate of increase in health care costs has slowed, hospital admissions have declined, length of hospital stay has been shortened and hospital occupancy has been reduced. All this seems to be for the better, but patients have found themselves discharged from hospitals “sicker and quicker.”

Posthospital services, described as a “no-care zone” by UCSF Professor Carroll Estes, have been unable to cope adequately with the changes.

The number of people who are uninsured or underinsured has risen rapidly and local governments, such as San Francisco County, have found themselves obliged to care for increasing numbers of sick, disabled and poor.

Three future scenarios seem possible given the current environment:

• Continued reliance on price competition and the marketplace with the evolution of a “three-tiered” system of care consisting of fee for service, HMOs and public sector.
• A variety of incremental strategies to fill the gaps in coverage at the state level through mandated private insurance coverage, state funds to cover the uninsured and an expansion of Medicaid.
• Publicly funded national health insurance, along the lines of the Canadian model.

Although the odds are against national health insurance, this proposal would provide the most equitable solution to health care access with effective means to control costs while assuring freedom of choice for consumers and providers.

Personally, I believe it is the preferred solution.

 

Comment by: Don McCanne & Jim Kahn

Philip Lee was an icon of health care justice, perhaps most noted for his role in implementing Medicare. Particularly noble was his use of Medicare funding as a lever to eliminate segregation in the nation’s hospitals and, by extension, throughout the medical system. Over his career, he remained a champion of health equity and justice for all. Thus, his commentary authored 38 years ago comes as no surprise to us.

Let’s review the challenge he described from today’s perspective, nearly four decades later. Of the three scenarios Dr. Lee described, the US followed a mix of free market and incremental changes; not the national health insurance option he preferred. Dr. Lee was prescient. As a result, we accumulated decades of fraught experience – high costs, low health care access, and high mortality.

Dr. Lee’s “publicly funded national health insurance, along the lines of the Canadian model” has proven to be quite effective in other wealthy nations. We should have chosen the option that, as he describes, would combine equity, choice, and cost control. Health justice for all, efficiently.

Clearly the market approach and mandated private insurance succeeded in creating wealth for health care investors but was certainly ineffective in ensuring affordable, comprehensive care for everyone.

Philip Lee bestowed on us this powerful message of health justice. We should act on his advice. It’s not too late.