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3/18/2009 – Editorials

By Richard Peterson

How about the outrageous salary of more than a million dollars a year paid to the former chief executive officer of North Dakota BlueCross BlueShield? How about the $2.2 million severance pay he will receive?

Outrageous is the only word I can come up to describe the situation.

Well, scandalous would also do. I wonder how many other people working for ND BlueCross BlueShield are getting more than a quarter million a year. Probably quite a few.

Some will undoubtedly say the high salaries are necessary to get the proper talent. Baloney! There are all kinds of talented people right here in North Dakota who would gladly do the job for much less. The salaries of executives have gotten totally out of line.

All that money is part of the cost of health care. BlueCross BlueShield is only one insurance company and not a terribly big one at that. Nationwide there are many more insurance companies with bloated executive pay. The paperwork and salaries demanded by these bureaucracies is said to be about one-third of the cost of health care.

If the insurance companies were removed from the health care system and the US joined other nations in instituting a single payer (the government), such as in Canada and Germany, we would be better off.

Canadians don’t have to worry about losing their life savings to a nursing home, for instance.

But we aren’t supposed to consider such a radical departure from for-profit medicine because of the boogeyman word "socialism."

I just want to point out that we don’t become socialists because we take a good idea from socialism and adapt it in our system. After all, Social Security is one of the government’s finest programs and there is no doubt that it is socialism. Yes, it definitely is socialism. As long as they can’t destroy it to satisfy their ideology, even conservatives happily collect Social Security.

Medicare is also socialism. So is unemployment insurance. So is workers compensation. Our military system is a huge socialistic venture with care from cradle to the grave. So, don’t be scared when the boogeyman word is used because we’re living with socialistic programs every day and most of them make our lives better.

I’ve never met a Canadian who’s been willing to exchange our system of medical care for their system.


The American International Group (AIG), which has received more than $170 billion in taxpayer bailout money from the Treasury and Federal Reserve, planned to pay about $165 million in bonuses to executives in the same business unit that brought the company to the brink of collapse last year.

The policyholders get screwed and the taxpayers get screwed. That’s what happens when capitalism isn’t regulated.


This came in an e-mail:

Single-payer national health insurance is a system in which a single public or quasi-public agency organizes health financing, but delivery of care remains largely private.

Currently, the US health care system is outrageously expensive, yet inadequate. Despite spending more than twice as much as the rest of the industrialized nations ($7,129 per capita), the US performs poorly in comparison on major health indicators such as life expectancy, infant mortality and immunization rates. Moreover, the other advanced nations provide comprehensive coverage to their entire populations, while the US leaves 47 million completely uninsured and millions more inadequately covered.

The reason we spend more and get less than the rest of the world is because we have a patchwork system of for-profit payers. Because profit is the goal, private insurers waste health dollars on things that have nothing to do with care: overhead, underwriting, billing, sales and marketing departments as well as huge profits and exorbitant executive pay. To accommodate this system, doctors and hospitals must maintain costly administrative staffs to deal with the bureaucracy. These non-patient expenses consume one-third (31 percent) of Americans’ health dollars.

Single-payer financing is the only way to recapture this wasted money. Simply getting rid of the paperwork would save more than $350 billion per year. That sum alone is enough to provide comprehensive coverage to everyone — without paying any more than we already do.

Under a single-payer system, all Americans would be covered for all medically necessary services, including: doctor, hospital, long-term care, mental health, dental, vision, prescription drug and medical supply costs. Patients would regain free choice of doctor and hospital and doctors would regain autonomy over patient care.

Physicians would be paid fee-for-service according to a negotiated formulary or receive salary from a hospital or nonprofit HMO/group practice. Hospitals would receive a global budget for operating expenses. Health facilities and expensive equipment purchases would be managed by regional health planning boards.

A single-payer system would be financed by eliminating private insurers and recapturing their administrative waste. Modest new taxes would replace premiums and out-of-pocket payments currently paid by individuals and business. Costs would be controlled through negotiated fees, global budgeting and bulk purchasing.


It won’t be free, but a couple won’t have to pay nearly $1,000 per month for health insurance.

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