Labor and HMOs

I found this article on the PNHP site. It's an interesting description of how HMOs came into being in the early '70s with the support of the AFL-CIO. Now, with the push to privatize Medicare and Medicaid, will Labor step up and take the lead in fixing the mess they helped create?

Unions Should Break With Managed Care
by Kip Sullivan

... Despite solid evidence that turning Medicare and Medicaid over to HMOs raises the costs of these programs and damages quality of care, politicians of both parties continue to support the further privatization of both programs.

To give you some idea of how solid the data against privatization of Medicare and Medicaid are, consider just two studies. A 2003 study of California’s Medicaid program, which is partially privatized, by a University of Maryland economist concluded that privatization raised that program’s cost by 20 percent.

In a 1999 report to Congress, the U.S. General Accounting Office stated, “[N]umerous studies conducted by us … and others demonstrated that the Medicare program spent more on beneficiaries enrolled in health plans than it would have if the same individuals had been in FFS [‘fee for service,’ which refers to the traditional Medicare program].”

Unions do not wield as much influence with Democrats today as they did in 1971, but they remain a critical part of the Democratic base and could play a very important role in sharpening and strengthening Democratic health policy. The AFL-CIO could help the nation extract itself from this health care mess if it were to renounce its endorsement of managed care and undertake a campaign to roll back the privatization of Medicaid and Medicare. ...

Read the full article