The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care

“The thesis of this book is that we can find cost-effective ways to cover every American by borrowing ideas from foreign models of health care […] But many Americans intensely dislike the idea that we might learn useful policy ideas from other countries, particularly in medicine.” 

Reid explains the purpose behind his writing the book. He acknowledges how the notion of American exceptionalism impedes the nation from making better decisions about health care.

“In U.S. policy debates, the term ‘socialized medicine’ has been a powerful political weapon—even though nobody can quite define what it means. The term was popularized by a public relations firm working for the American Medical Association in 1947 to disparage President Truman’s proposal for a national health care system. It was a label, at the dawn of the cold war, meant to suggest that anybody advocating universal access to health care must be a communist. And the phrase has retained its political power for six decades.” 

Much of the aversion to universal health care is rooted in propaganda that plays on fears that a systemic change will undermine American free market values. What many Americans do not know, which Reid later explains, is that, in some other countries with universal health care—particularly Germany—patients still have access to any plan they choose and select their own doctors. Meanwhile, medical providers can maintain private practices. The long-standing fears are, therefore, unfounded.

“In Bismarck countries, both health care providers and payers are private entities. The model uses private health insurance plans, usually financed jointly by employers and employees through payroll deduction. Unlike the U.S. health insurance industry, though, Bismarck-type plans are basically charities: They cover everybody, and they don’t make a profit.” 

American patients use a version of the Bismarck system, in that employers and employees split the cost of the premium. The important distinction is that four-fifths of the funds from premiums do not go into health care. A large percentage goes toward dividends for investors, thereby revealing that insurance is largely a for-profit scheme in the US. This isn’t true in countries, such as France and Germany, that use the Bismarck system.

“In Beveridge systems, many (sometimes all) hospitals and clinics are owned by the government; some doctors are government employees, but there are also private doctors who collect their fees from the government. These systems tend to have low costs per capita, because the government, as the sole payer, controls what doctors can do and what they can charge.” 

The Beveridge system, which originated in Great Britain and is the model for the NHS, is what many Americans likely have in mind when they think of socialized medicine. However, even the notion that Beveridge systems are totally public is misguided, given that doctors operate privately. The role of government in this system is to keep health care prices affordable for patients.

“And yet we’re like no other country, because the United States maintains so many separate systems for separate classes of people, and because it relies so heavily on for-profit private insurance plans to pay the bills. All the other countries have settled on one model for everybody, on the theory that this is simpler, cheaper, and fairer. With its fragmented array of providers and payers and overlapping systems, the U.S. health care system doesn’t fit into any of the recognized models.”

Ironically, the US demonstrates exceptionalism regarding the incoherence of its health care system. Health insurance companies—which have a powerful political lobby in the nation’s capital—have arranged health care to benefit only themselves and their shareholders. 

“All the developed countries I looked at provide health coverage for every resident, old or young, rich or poor. This is the underlying moral principle of the health care system in every rich country—every one, that is, except the United States.” 

In other industrialized nations, health care is deemed a moral right and a necessity for maintaining a healthy, functioning populace. The US has long regarded health care differently—as a commercial product that patients may or may not opt into buying. Even the passage of the Affordable Care Act did not eradicate this fundamental commercial principle.

“In addition to the risk of disability or death due to the disease, there’s the risk of financial ruin due to the medical and pharmaceutical bills. This is a uniquely American problem […] How many people go bankrupt because of medical bills? In Britain, zero. In France, zero. In Japan, Germany, the Netherlands, Canada, Switzerland: zero. In the United States […] the annual figure is around 700,000.” 

Health care is inextricably linked to one’s financial well-being in the US. One health incident—and not even a particularly catastrophic one—can lead to financial hardship, if not financial ruin. Part of this is due to the health care industry’s lack of consideration for a patient’s financial status when doling out medical bills.

“On paper, therefore, France is a multipayer [sic] health care system, with fourteen different sickness funds and a cluster of supplemental plans paying doctors and providers. In practice, France acts like a single-payer system, because the national Health Ministry essentially dictates what providers can charge for most types of treatment and what price will be paid for each prescription.” 

France uses a form of the Bismarck model that gives fewer choices than the models that are employed in Germany and Japan. However this system, like the others, ensures that health care will remain affordable due to bureaucratic oversight over insurance companies. 

“In the States, I would make much, much more. But there I would be fighting always the insurance companies over what I can prescribe, what I can do for my patients. Here, we have the freedom to do with medicine we think is right. And the patient, any patient, can get the treatment needed […] I will never be rich, but I can look in the mirror in the morning and know that I am doing the best for my patients. For a physician, that is a form of richness; it brings satisfaction.” 

Dr. François Bonnaud explains why he is prouder to work within the French health care system, though it doesn’t offer the economic benefits that a doctor would acquire working in the US. Bonnaud illustrates how the for-profit system has shifted health care providers away from doing the important work—treating patients through the best possible methods—and toward the ignoble task of seeking ways to make the most money. 

“As head of this new nation, Bismarck saw that his historic role would be to create Germany not simply as a legal entity but as a political, financial, and cultural union. One way to do that was to provide benefits for people in every region of the Reich—to give Bavarians, Hanoverians, Frankfurters, and everyone else a sense of belonging, of gratitude, toward the new national government in Berlin. And thus Bismarck invented the welfare state.” 

Bismarck invented the idea of a national health care system, using the notion of national solidarity to legitimize it. If everyone in Germany—then a motley collection of nation-states—had the same health care, the people would regard themselves as one nation. One wonders if this could ever be true in the US, which is also stratified geographically.

“But the single national system, with minimal paperwork and no billing, has proven to be an unusually cost-efficient means of providing quality health care to everybody. It cares for roughly one-fifth the population of the United States but spends only one-fifteenth of the U.S. health care bill. And yet the results are good: Britain has lower child mortality, longer healthy life spans, and better recovery rates from most major diseases than does the United States.” 

Contrary to American prejudices about single-payer health care systems, Britain’s National Health Service works exceptionally well, in terms of providing the services that it has set out to offer. The US offers more options, under the guise of providing a fairer health care system, but it fails to provide a range of services to an entire population, as Britain does.

“A system in which government owns the hospitals, pays the doctors, buys the medicine, and covers all the bills would probably come pretty close to what American politicians have in mind when they deplore ‘socialized medicine.’ But America, too, has copied the NHS model—to provide treatments for tens of millions of Native Americans, military personnel, dependents, and veterans. With government doctors in government clinics dispensing government drugs (and no bills for the patients to pay), the U.S. Department of Veterans Affairs is one of the purest examples anywhere of the Beveridge model at work. If this is un-American, why did we choose it for America’s military veterans?” 

Reid is subtly pointing at a hypocrisy in the American argument, particularly from politicians, that “socialized medicine,” or a single-payer health care system, wouldn’t work in the US. As Reid notes, the US already uses variations of this system within its bureaucracy. The question that the public has not asked is why the government is willing to provide the service for a segment of society and not for the whole, when universal health care has proven to be more cost-effective in both the short-term and the long-term.

“But the most common theory about the failure of the Clinton reform plan—and of the Roosevelt, Wilson, Truman, and Nixon reform plans before it—involved the nature of health care itself […] [T]he business of providing and paying for American’s medical care is so complex and involves so much money that significant change is politically hopeless.”

The American government’s inability to make any significant change to health care is related to the influence of the insurance lobby in Washington, which is invested in keeping health care a for-profit industry. However, significant reform is also hindered by health care providers who prioritize their wealth over providing the best care to the largest segment of the population.

“Mrs. Lee explained: Her mother contracted breast cancer in the 1980s, when Taiwan had no national health care system and Jinshan had no hospital. Her mother died. Some twenty years later, Mrs. Lee also got breast cancer, and feared the worst. By then, though, Jinshan had its new hospital and Taiwan had a health care system that ensured treatment for Lee Ching-li. She recovered completely. She expects to live forty years longer than her mother did, to see her children and grandchildren grow to adulthood. She felt a need to express her gratitude to the doctors, the hospital, and the system that cured her, so now she volunteers three days a week at the hospital.” 

Reid uses this personal anecdote to demonstrate how universal health care can save lives and preserve families. Providing adequate health care is not just a matter of treating sick people but of ensuring that social networks remain intact.

“First, there was a strong public demand for universal health insurance. Second, an entrenched political party with a parliamentary majority found itself challenged by a rising opposition party that had openly embraced universal health insurance. Third, sustained economic growth…made financing a major new program feasible…The lesson for policymakers elsewhere is that such windows of opportunity come along only every so often.” 

Taiwanese-American economist Tsung-Mei Cheng, a member of the team of experts that designed Taiwan’s health care system, explains why Taiwan’s decision for universal health care succeeded. Though reform was politically motivated, sometimes the desire for a rival party to win by capitalizing on a strong public sentiment can produce good long-term benefits for a nation’s stability and well-being.

“A society cannot have complete equality […] It is not possible. You can earn more money than your neighbor; that is not society’s business. But a good railway system, a good school system, a good health system—the basic needs of the people—must be handled with a high degree of equality. To have a great sense of solidarity among the people, all must have an equal right—and particularly, a right to medical care. Because it is a profound need for people to be sure, if they are struck by the stroke of destiny, they can have a good health system. Our society must meet that need.”

Pascal Couchepin, the president of the Swiss Federation, explains why Switzerland went from a for-profit health insurance system, based on the American model, to universal health care. Like Otto von Bismarck in 19th-century Germany, the Swiss government came to realize that good infrastructure, a healthy populace, and a sense of national solidarity mattered more than short-term financial gains. Also, to maintain faith in the system, it’s important for people to feel secure within it. That security is severely compromised when people worry that one stroke of bad luck can ruin their lives.

“Both Wendy and Juanita are Americans […] Wendy and Juanita both get one vote in any election. They both have the right to free public education for their daughters. If these women were accused of a crime, both would have the right to the full panoply of legal protections in the courtroom. Both women have the same access to police protection, public libraries, state parks, trash pickup, and other services provided by government. But many aspects of life in America, of course, are not equal for everybody. And hardly anybody suggests that all inequalities should be eliminated.” 

Reid uses the fictional examples of CEO Wendy Wilbur and the laborer Juanita Gonzalez to illustrate how economic status predetermines access to health care. Gonzalez is Hispanic, and probably a woman of color, while Ms. Wilbur is presumably white, given that she is a third-generation CEO and granddaughter of an industrialist—a privilege that few women of color have been known to enjoy. Reid focuses on health care inequality but exaggerates equality in other areas. There are also major disparities in access to education, fairness in elections, experiences with police and the legal system, and in living in communities with adequate sanitation when comparing the lives of whites and nonwhites.

“Before you can set up a health care system for any country, […] you have to know that country’s basic ethical values. The first question is: Do people in your country have a right to health care? If the people believe that medical care is a basic right, you design a system that means anybody who is sick can see a doctor. If a society considers medical care to be an economic commodity, then you set up a system that distributes health care based on the ability to pay. And then the poor, pretty much, are left out.” 

The economist William Hsiao explains how the issue of health care reform is tied to a nation’s ethical values, particularly its willingness to allow the poor to have the same access to health care as the wealthy. However, as long as medical care is regarded as a commercial product, the right to access it will be predetermined by income. Thus, in the US and in out-of-pocket countries, access to health care is a class issue.

“The health care reform bill that Congress passed in 2010 made significant changes in the existing U.S. health care system […] But the law does nothing to simplify the ‘crazy quilt’ structure of different systems for different population groups; if anything; American health care will be even more complicated and difficult to navigate when ‘Obamacare’ takes full effect. And the new law will not get us to universal coverage, the bedrock principle of health care systems in every other industrialized democracy.”

Reid’s assessment of the Affordable Care Act is pessimistic. The legislation hasn’t resolved the fundamental problems within the American health care system: unaffordability, inefficacy, and a lack of clarity regarding fees and claims.

“A unified health care system that works the same for everybody doesn’t necessarily equate to a single-payer system. As we’ve seen, countries on the Bismarck model generally have several, or many, different insurance plans. Germany has more than two hundred; Japan has more than two thousand. Canada has a separate government-run insurance fund for each of its provinces and territories. But these multipayer systems still provide the fairness and administrative simplicity of a single-payer structure; because all patients are treated the same, all the payers follow a coordinated set of rules and forms, and all providers’ fees must adhere to a unified payment schedule.” 

For Americans who believe that “socialized medicine,” or universal health care, can only operate in a particular way, Reid reminds readers that other countries with universal health care have different modes of operation. Even within a particular model, there is variation.

“Health insurance companies don’t have to be cruel to their customers if they don’t have to worry about paying dividends to investors. But insurance firms whose primary mission is to make a profit quickly realize that covering every applicant and paying every claim will eat into profits. So they deny coverage to those who need it most, reject claims by the bucketful, and search for ways to rescind coverage just when the big bills rolls in. That’s why health insurance companies are loathed by their customers but loved on Wall Street. That’s why health care economists around the world say that there’s a basic conflict between the principle of health insurance and the pursuit of profit.”

Reid illustrates how the for-profit model of health care acts against the best interests of the general population. Often, people don’t understand why their claims are denied, beyond accepting that the insurance company simply doesn’t want to pay. It seldom occurs to anyone that the company doesn’t want to pay because it wants to maximize profits to their investors. Most of the money that Americans pay toward premiums doesn’t go toward their health care but toward an insurance company’s overhead and to shareholders. 

“Consider, for example, this common dilemma. There’s a kidney available for transplant and two patients with an acute need for it. How does a health system choose between the two potential recipients? What if one patient is wealthy and well-connected and the other a part-time janitor at Wal-Mart? Should that matter? What if one of the patients is a decorated Army veteran who fought for her country and the other runs an Internet porn site? Should that matter?” 

Reid provides the reader with a series of rhetorical questions to prompt thinking about Americans’ ethics around health care. He draws attention to class differences, perceptions of success, and personal morals to prompt readers to examine their own biases, which may prevent access to universal health care.

“Still there are experts who argue that American health care ranks with the best in the world. These advocates note that the United States has doctors, hospitals, research labs, and medical schools that lead the world when it comes to innovative high-tech approaches to acute and chronic medical problems. American medicine has more specialists, more technology, more groundbreaking experimentation than any other country, rich or poor. And the American reliance on private, for-profit health insurance companies for the bulk of medical coverage is in accord with American values of capitalism and freedom.” 

Those medical experts who detract from supporting universal health care point to capitalist model as the driver of medical innovation in the US. However, as Reid points out when describing Japan, price controls can also spur innovation and competition among equipment manufacturers and pharmaceutical companies.