Used for Medical Grand Rounds at several hospitals, this is data based comprehensive review of the shortcomings of the American Medical System and dysfunctional political attempts at reform. Single payer, Medicare for all, with elimination of for profit insurance companies is the best answer.

1. Medicine is a social science, and politics is nothing else but medicine on a large scale. Medicine, as a social science, as the science of human beings, has the obligation to point out problems and to attempt their theoretical solution: the politician, the practical anthropologist, must find the means for their actual solution….The physicians are the natural attorneys of the poor, and social problems fall to a large extent within their jurisdiction. RUDOLPH VIRCHOW 1821-1902

2. WHY WE NEED HEALTH CARE REFORM, WHY IT IS SO DIFFICULT and THE CALIFORNIA SINGLE PAYER SOLUTION Jeoffry B. Gordon, MD, MPH Ocean Beach Medical Group 1947 Cable Street San Diego, CA 92107 619 223-7164 [email_address] UNIVERSITY OF CALIFORNIA, SAN DIEGO PHI DELTA EPSILON ANNUAL GELFAND LECTURE February 24, 2010

4. Iglehart J. N Engl J Med 2009;10.1056/NEJMp0901927 Per Capita Health Care Spending in Various Countries in 2006, According to the Country's Relative Wealth

5. Population Percentile Ranked by Health Care Spending Concentration of Health Spending in the U.S., 2004 Notes: Population includes those without any health care spending and excludes those living in institutions. Health spending is defined as total payments, or the sum of spending by all payer sources. Source: Kaiser Family Foundation calculations using data from U.S. Department of Health and Human Services, Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey (MEPS), 2004.

6. Exhibit 13. Premiums Rising Faster Than Inflation and Wages * 2008 and 2009 NHE projections. Data: Calculations based on M. Hartman et al., “National Health Spending in 2007,” Health Affairs , Jan./Feb. 2009; and A. Sisko et al., “Health Spending Projections through 2018,” Health Affairs, March/April 2009. Insurance premiums, workers’ earnings, and CPI from Henry J. Kaiser Family Foundation/Health Research and Educational Trust, Employer Health Benefits Annual Surveys, 2000–2009 . Source: K. Davis, Why Health Reform Must Counter the Rising Costs of Health Insurance Premiums, (New York: The Commonwealth Fund, Aug. 2009). Projected Average Family Premium as a Percentage of Median Family Income, 2008–2020 Cumulative Changes in Components of U.S. National Health Expenditures and Workers’ Earnings, 2000–2009 Percent Percent 108% 32% 24% Projected

7. Cumulative Changes in Components of U.S. National Health Expenditures and Workers’ Earnings, 2000–2008 * 2007 and 2008 NHE projections. Data: Authors’ calculations based on A. Catlin et al., “National Health Spending in 2006,” Health Affairs , Jan./Feb. 2008; and S. Keehan et al., “Health Spending Projections Through 2017,” Health Affairs Web Exclusive (Feb. 26, 2008). Workers’ earnings from Henry J. Kaiser Family Foundation/Health Research and Educational Trust, Employer Health Benefits Annual Surveys, 2000–2008 . 106% 75% 29% Percent 47% Exhibit 9

15. In Turnabout, Infant Deaths Climb in South By ERIK ECKHOLM , April 22, 2007 HOLLANDALE, Miss. — For decades, Mississippi and neighboring states with large black populations and expanses of enduring poverty made steady progress in reducing infant death. But, in what health experts call an ominous portent, progress has stalled and in recent years the death rate has risen in Mississippi and several other states. The setbacks have raised questions about the impact of cuts in welfare and Medicaid and of poor access to doctors, and, many doctors say, the growing epidemics of obesity , diabetes and hypertension among potential mothers, some of whom tip the scales here at 300 to 400 pounds…. To the shock of Mississippi officials, who in 2004 had seen the infant mortality rate — defined as deaths by the age of 1 year per thousand live births — fall to 9.7, the rate jumped sharply in 2005, to 11.4 . The national average in 2003, the last year for which data have been compiled, was 6.9. Smaller rises also occurred in 2005 in Alabama , North Carolina and Tennessee . Louisiana and South Carolina saw rises in 2004 and have not yet reported on 2005…. Most striking, here and throughout the country, is the large racial disparity. In Mississippi, infant deaths among blacks rose to 17 per thousand births in 2005 from 14.2 per thousand in 2004, while those among whites rose to 6.6 per thousand from 6.1. (The national average in 2003 was 5.7 for whites and 14.0 for blacks.) The overall jump in Mississippi meant that 65 more babies died in 2005 than in the previous year, for a total of 481.

16. The Accidental Cost of Being Uninsured Heather Rosen, MD, MPH; Fady Saleh, MD, MPH; Stuart Lipsitz, ScD; Selwyn O. Rogers Jr, MD, MPH; Atul A. Gawande, MD, MPH Arch Surg. 2009;144(11):1006-1011. Hypothesis Given the pervasive evidence of disparities in screening, hospital admission, treatment, and outcomes due to insurance status, a disparity in outcomes in trauma patients (in-hospital death) among the uninsured may exist, despite preventive regulations (such as the Emergency Medical Treatment and Active Labor Act). Design Data were collected from the National Trauma Data Bank from January 1, 2002, through December 31, 2006 (version 7.0). We used multiple logistic regression to compare mortality rates by insurance status. The National Trauma Data Bank contains information from 2.7 million patients admitted for traumatic injury to more than 900 US trauma centers, including demographic data, medical history, injury severity, outcomes, and charges. Patients Data from patients (age, 18 years; n = 687 091 ) with similar age, race, injury severity, sex, and injury mechanism were evaluated for differences in mortality by payer status. Main Outcome Measure In-hospital death after blunt or penetrating traumatic injury. Results Crude analysis revealed a higher mortality for uninsured patients (odds ratio [OR], 1.39; 95% confidence interval [CI], 1.36-1.42; P < .001). Controlling for sex, race, age, Injury Severity Score, Revised Trauma Score, and injury mechanism (adjusted for clustering on hospital), uninsured patients had the highest mortality (OR, 1.80 ; 95% CI, 1.61-2.02; P < .001). Subgroup analysis of young patients unlikely to have comorbidities revealed higher mortality for uninsured patients (OR, 1.89; 95% CI, 1.66-2.15; P < .001), as did subgroup analyses of patients with head injuries (OR, 1.65; 95% CI, 1.42-1.90; P < .001) and patients with 1 or more comorbidities (OR, 1.52; 95% CI, 1.30-1.78; P < .001). Conclusions Uninsured Americans have a higher adjusted mortality rate after trauma. Treatment delay, different care (via receipt of fewer diagnostic tests), and decreased health literacy are possible mechanisms.

18. Potential Years of Life Lost Due to Diabetes per 100,000 Population, 2006 *2005 **2004 Data: OECD Health Data 2008 (June 2008).

19. Mortality Amenable to Health Care: U.S. Failing to Keep Pace with Other Countries Deaths per 100,000 population* * Countries’ age-standardized death rates before age 75; including ischemic heart disease, diabetes, stroke, and bacterial infections. Data: E. Nolte and C. M. McKee, London School of Hygiene and Tropical Medicine analysis of World Health Organization mortality files (Nolte and McKee, Health Affairs 2008). Source: Commonwealth Fund National Scorecard on U.S. Health System Performance, 2008. Exhibit 2

22. Copyright ©2008 American Cancer Society From Ward, E. et al. CA Cancer J Clin 2008;58:9-31. FIGURE 10 Cancer Survival by Insurance Status*

23. Copyright ©2008 American Cancer Society From Ward, E. et al. CA Cancer J Clin 2008;58:9-31. FIGURE 11 Breast Cancer Stage Distribution by Race and Insurance Status*

24. Copyright ©2008 American Cancer Society From Ward, E. et al. CA Cancer J Clin 2008;58:9-31. FIGURE 14 Colorectal Cancer Stage Distribution by Race and Insurance Status*

28. LOSING PRIMARY CARE: Shortages in pediatrics, internal medicine and family medicine. Decreased access to geriatricians and gynecologists. Low interest by medical students because of: high student loan debt malpractice insurance low starting salaries

30. The federal government designates regions as being underserved based on per capita numbers. To be designated, a region needs to have less than one family doctor per 3,500 residents . Using just this ratio, the communities have 7,413 fewer primary-care doctors than they need, the HRSA said. An adequate level -- established by public health clinicians and staff as affording “appropriate” access to health care -- is 1 for every 2,000 residents , according to the HRSA, which gathers the data. That brings the deficit to 16,679 . In most industrialized nations, including Germany and the U.K., there is one primary-care physician for every specialist , according to the Organization of Economic Cooperation and Development in Paris. The U.S. ratio is closer to one to three , according to the AMA. The U.S. will need another 35,000 to 46,000 primary-care doctors within 15 years as the population ages , the American College of Physicians said in a 2009 report. Doctor Shortage to Spur Delays, Crowded ERs in Health Overhaul By Pat Wechsler Nov. 13,2009 (Bloomberg News)

31. † -Primary care rank is a rank of primary scores. The primary score is derived from the average of scores on 11 features of primary care. (See Starfield B. Primary care: concept, evaluation, and policy. New York: Oxford University Press, 1992)

34. PHOTOGRAPH FOR TIME BY DAN WINTERS. INSETS, FROM LEFT: MARIO TAMA/GETTY; BRIAN BOWEN SMITH FOR TIME.

35. SCMG Commercial Co-pay Trend ® Community Medical Group SHARP

37. Our results, however, suggest that increasing copayments for ambulatory care among elderly Medicare beneficiaries may be a particularly ill-advised cost-containment strategy . Assuming an average reimbursement of $60 for an outpatient visit, 33 seven annual outpatient visits per enrollee, and an average copayment increase of $8.50 per visit, a Medicare plan would receive an additional $5,950 in patient copayments and avert $1,200 in spending on outpatient visits for every 100 enrollees, for a total of $7,150 in savings for the health plan. However, assuming an average cost of $11,065 for hospitalization of a person 65 to 84 years of age in 2006, 34 our estimates suggest that expenditures for inpatient care will increase by $24,000 for every 100 health plan enrollees in the year after copayments for ambulatory care are increased. Increased Ambulatory Care Copayments and Hospitalizations among the Elderly Amal N. Trivedi, M.D., M.P.H., et al NEJM 362:320-328, Jan 28,2010 Background When copayments for ambulatory care are increased, elderly patients may forgo important outpatient care, leading to increased use of hospital care. Methods We compared longitudinal changes in the use of outpatient and inpatient care between enrollees in Medicare plans that increased copayments for ambulatory care and enrollees in matched control plans — similar plans that made no changes in these copayments. The study population included 899,060 beneficiaries enrolled in 36 Medicare plans during the period from 2001 through 2006. Results In plans that increased copayments for ambulatory care, mean copayments nearly doubled for both primary care ($7.38 to $14.38) and specialty care ($12.66 to $22.05). In control plans, mean copayments for primary care and specialty care remained unchanged at $8.33 and $11.38, respectively. In the year after the rise in copayments, plans that increased cost sharing had 19.8 fewer annual outpatient visits per 100 enrollees (95% confidence interval [CI], 16.6 to 23.1), 2.2 additional annual hospital admissions per 100 enrollees (95% CI, 1.8 to 2.6), 13.4 more annual inpatient days per 100 enrollees (95% CI, 10.2 to 16.6), and an increase of 0.7 percentage points in the proportion of enrollees who were hospitalized (95% CI, 0.51 to 0.95), as compared with concurrent trends in control plans…. The effects of increases in copayments for ambulatory care were magnified among enrollees living in areas of lower income and education and among enrollees who had hypertension, diabetes, or a history of myocardial infarction. Conclusions Raising cost sharing for ambulatory care among elderly patients may have adverse health consequences and may increase total spending on health care….

43. Copyright ©2008 American Cancer Society From Ward, E. et al. CA Cancer J Clin 2008;58:9-31. FIGURE 6 Health Insurance Coverage of the Nonelderly by Race/Ethnicity, 2005

45. San Diego city, CA Estimate Margin of Error Total: 1,229,933 +/-25,707 Under 65 years: 1,098,307 +/-25,386 With health insurance coverage 885,196 +/-22,310 No health insurance coverage 213,111 +/-12,768 65 years or over: 131,626 +/-5,213 With health insurance coverage 129,010 +/-5,187 No health insurance coverage 2,616 +/-891 Source: U.S. Census Bureau, 2008 American Community Survey

46. Who Delivers Health Care? Growth in Physicians and Administrators since 1970 Source: BLS & Himmelstein/Woolhandler/Lewontin Analysis of CPS Data

50. Anthem Blue Cross dramatically raising rates for Californians with individual health policies. Policyholders are incensed over rate hikes of as much as 39%, which they say come on top of similar increases last year. State insurance regulators say they'll investigate. LA TIMES February 4, 2010 | 7:17 p.m.| By Duke Helfand C alifornia's largest for-profit health insurer is moving to dramatically raise rates for customers with individual policies, setting off a furor among policyholders and prompting state insurance regulators to investigate. Anthem Blue Cross is telling many of its approximately 800,000 customers who buy individual coverage -- people not covered by group rates – that its prices will go up March 1 and may be adjusted &quot;more frequently&quot; than its typical yearly increases….About 2.5 million Californians have individual insurance policies, accounting for a small portion of the state's overall insurance market. By contrast, nearly 21 million people in California are covered by health maintenance organizations. Eye-popping health insurance premium increases of up to 39 percent are not an exception but a worrisome sign of the times, the Obama administration said in a report Thursday…. The HHS report found that those numbers are in line with increases sought by insurers in other states — at a time of robust profit growth for the companies and a lack of competition in most states. For example, Anthem in Maine was denied an 18.5 percent increase last year and is now requesting that state regulators approve a 23 percent rise. Maine is home to Sens. Olympia Snowe and Susan Collins, Republican moderates whose support Obama would like to have for his health care legislation. Michigan's Blue Cross Blue Shield plan requested approval for premium increases of 56 percent in 2009. And in the state of Washington , rates for some individual health plans increased by up to 40 percent until regulators cracked down. Other states cited in the report were Connecticut, Oregon and Rhode Island . The premium increases affect the most vulnerable part of the health insurance market, policies marketed individually to customers buying their own plans.

52. Health insurance giant Aetna is planning to force up to 650,000 clients to drop their coverage next year as it seeks to raise additional revenue to meet profit expectations. In a third-quarter earnings conference call in late October, officials at Aetna announced that in an effort to improve on a less-than-anticipated profit margin in 2009, they would be raising prices on their consumers in 2010. The insurance giant predicted that the company would subsequently lose between 300,000 and 350,000 members next year from its national account as well as another 300,000 from smaller group accounts. &quot;The pricing we put in place for 2009 turned out to not really be what we needed to achieve the results and margins that we had historically been delivering,&quot; said chairman and CEO Ron Williams…. American Medical News, which first reported the story, noted that this is not the first time the insurance giant has cut the rolls in an effort to boost profit margins. &quot;As chronicled in a 2004 article in Health Affairs by health economist James C. Robinson, MD, PhD, Aetna completely overhauled its business between 2000 and 2003, going from 21 million members in 1999 down to 13 million in 2003, but boosting its profit margin from about 4% to higher than 7%.“ --- Sam Stein, HUFFPOST, December 4, 2009

53. Health Costs Are Bleeding Americans Dry

59. UnitedHealth Reaches $925 Million Settlement, Associated Press AUG-11-09: A proposed settlement between UnitedHealth and its shareholders has been given the green light by a federal judge, bringing to an end a class action lawsuit stemming from allegations of options backdating. The settlement is for $925 million , $895 million of which will be paid by UnitedHealth, and the remaining $30 million by former Chairman and CEO William McGuire, who was forced to step down as a result of the scandal in 2006. His portion of the payment cancels $3.6 million in stock options. The lead plaintiff in the case is the California Public Employees Retirement System. 19 Jan 2009 UnitedHealth Group on Thursday agreed to pay $350 million to settle three class-action lawsuits filed by physicians and health plan members over allegations that the company underpaid for out-of-network medical services, the New York Times reports (Abelson, New York Times , 1/16). On Tuesday, UnitedHealth agreed to settle an investigation by New York state Attorney General Andrew Cuomo (D) that found health insurers understated the portion of reimbursements for which they are responsible for such services by as much as 28% in some cases, or hundreds of millions of dollars over the last 10 years. Under the agreement with Cuomo, UnitedHealth will pay $50 million to finance the development of a new database that an undetermined university will operate ( Kaiser Daily Health Policy Report , 1/13). The latest settlement, which requires court approval, will pay health plan members and physicians for out-of-network services provided since 1994 (Fuhrmans, Wall Street Journal , 1/15)..

60. The McCarran-Ferguson Act , 15 U.S.C. § 1011, is a federal law that allows state law to regulate the business of insurance without federal government interference. It was passed by Congress in 1945 after the Supreme Court ruled in United States v. South-Eastern Underwriters Association (433 U.S. 533) that insurance could be regulated by the federal government via the Commerce Clause (as) interstate commerce. In 1944 the South-Eastern Underwriters Association controlled 90 percent of the market for fire and other insurance lines in six southern states and set rates at non-competitive levels. Furthermore, it used intimidation, boycotts and other coercive tactics to maintain its monopoly . The Court decided insurance was a form of &quot;interstate commerce&quot; which could be regulated under the Commerce Clause of the United States Constitution and the Sherman Anti-Trust Act. The McCarran-Ferguson Act says federal acts that do not expressly purport to regulate the &quot;business of insurance&quot; will not preempt state laws or regulations that regulate the &quot;business of insurance.&quot;The Act also provides that federal anti-trust laws will not apply to the &quot;business of insurance&quot; as long as the state regulates in that area, but federal anti-trust laws will apply in cases of boycott, coercion, and intimidation. .

64. The One Roller Coaster Almost Everyone Wants Off Of

66. Exhibit 11. Pharmaceutical Spending per Capita: 1995 and 2007 Adjusted for Differences in Cost of Living Source: OECD Health Data 2009 (June 2009). * 2006 *

67. Pfizer Pays $2.3 Billion to Settle Marketing Case By GARDINER HARRIS THE NEW YORK TIMES September 2, 2009 WASHINGTON — The pharmaceutical giant Pfizer agreed to pay $2.3 billion to settle civil and criminal allegations that it had illegally marketed its painkiller Bextra , which has been withdrawn…. The government charged that executives and sales representatives throughout Pfizer’s ranks planned and executed schemes to illegally market not only Bextra but also Geodon, an antipsychotic; Zyvox, an antibiotic ; and Lyrica , which treats nerve pain . While the government said the fine was a record sum, the $2.3 billion fine amounts to less than three weeks of Pfizer’s sales. Much of the activities cited Wednesday occurred while Pfizer was in the midst of resolving allegations that it illegally marketed Neurontin , an epilepsy drug for which the company in 2004 paid a $430 million fine and signed a corporate integrity agreement — a companywide promise to behave…. The settlement had been expected. Pfizer, which is acquiring a rival, Wyeth , reported in January that it had taken a $2.3 billion charge to resolve claims involving Bextra and other drugs. It was Pfizer’s fourth settlement over illegal marketing activities since 2002. “ Among the factors we considered in calibrating this severe punishment was Pfizer’s recidivism,” said Michael K. Loucks, acting United States attorney for the Massachusetts district.

75. If Congress can complete work on health-care legislation and send it to the president (as of mid-January, the final bill is still under negotiation), it will be a stunning historical achievement and the most important liberal reform since the 1960s….The legislation would be a major advance in two important respects. After a long period of rising inequality, it would boost the living standards of low-wage workers and their families and improve economic security for the middle class as well. And it would be the most ambitious effort in recent history to reorganize a major institution on a basis that agrees more closely with principles of justice and efficiency. In an ideal world the bill would be stronger, but we have to measure it against current reality and as a foundation for future progress. On those criteria it measures up well. … here is how the legislation would change that reality: It would expand coverage , first, by extending eligibility for Medicaid to people with incomes under or near the federal poverty line and, second, by subsidizing private insurance for people earning up to four times the poverty level. More than 30 million people would gain coverage as a result (the more generous the subsidies, the higher that number). The basic rules of the insurance market would change . Insurers could no longer exclude pre-existing conditions or charge according to an individual's health; they would be required to issue a policy and renew it for any legal applicant; and while they could vary premiums by age, they could do so only within limits, unlike current practice. The law's central organizational innovation would be to create insurance exchanges offering multiple insurance plans, Underrating Reform Paul Starr | THE AMERICAN PROSPECT | January 25, 2010

76. Exhibit . Total National Health Expenditures (NHE), 2009–2019, Current Projection and Alternative Scenarios NHE in trillions * Modified current projection estimates national health spending when corrected to reflect underutilization of services by previously uninsured. Source: D. M. Cutler, K. Davis, and K. Stremikis, Why Health Reform Will Bend the Cost Curve (Washington and New York: Center for American Progress and The Commonwealth Fund, Dec. 2009). $2.5 $4.7 $4.5 6.4% annual growth 6.6% annual growth 6.0% annual growth $4.8 Total 10-Year NHE Savings Compared with Modified Current Projection $1.090 Trillion

83. SB 810 (LENO) The California Universal Healthcare Act Affordable Health Insurance for All Californians FACT SHEET Passed California Senate January 28, 2010 Background: Health care costs are crushing California’s economy and the state budget, forcing steep annual cuts in health care access and quality for Californians and their employers. Health insurance premiums annually grow 4 times faster than wages, and have risen 87% since 2000 [1]. There are now 7 million uninsured Californians, but as insurance companies reduce health coverage, polls show that most insured Americans are now worried about how to pay for their health care if they get sick…. California spent an estimated $212 billion in healthcare last year[3]. This is plenty of money to provide every resident of the state with excellent healthcare, ensure fair and reliable reimbursements to doctors, nurses and other providers, and guarantee a high quality of care for all…. SB 810 (Leno), the California Universal Healthcare Act would provide fiscally sound, affordable healthcare to all Californians, give every Californian the right to choose his or her own physician and control health cost inflation. Truly Universal: Eligibility is based on residency, instead of on employment or income. Under the Act, all residents are covered. No California resident will ever again lose his or her health insurance because of unaffordable insurance premiums, because he or she changes or loses a job, goes to or graduates from college or has a pre-existing medical condition. Shared Responsibility: Under the Act everyone – individuals, employers and government pays something in and everyone gets healthcare. Affordable: The plan involves NO NEW SPENDING on healthcare. The system will be paid for by federal, state and county monies already being spent on healthcare and by affordable insurance premiums that replace all premiums, deductibles, out-of-pocket payments and co-pays now paid by employers and consumers. Total Choice: Under SB 810, delivery of care remains as it is; a competitive mix of public and private providers. All consumers have complete freedom to choose their healthcare providers. No more restrictive HMO networks.