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Private Health Insurance Is Not Part of the Health Care Solution, Consumer Advocates Tell Congress

National Single-Payer Plan Would Save Billions in Administrative Costs and Thousands of Lives a Year

WASHINGTON - Congress must eliminate the private insurance industry and implement
a national single-payer system if it wants to achieve true health care
reform, two leading patient advocates told a U.S. House of
Representatives subcommittee today.

Replacing private insurance companies with a national health
insurance program could save $400 billion a year in excessive
administrative costs, provide coverage to the 45 million people in the
United States who are uninsured, and help prevent the more than 18,000
deaths a year from a lack of health insurance, said Dr. Sidney Wolfe,
M.D., Public Citizen’s acting president, and Dr. Steffie Woolhandler,
M.D., co-founder of the Physicians for a National Health Program.

"The real question is why should we tolerate the fragmented, highly
profitable, administrativelywasting private health insurance industry
any longer?" Wolfe told the Energy and Commerce Committee’s Health
Subcommittee.

The health insurance and pharmaceutical industries thrive on the
current decentralized system because there are no price controls and
insurers can turn away patients who are "unprofitable," Wolfe said. The
insurance industry makes huge profits by denying care, paying out as
little as it can and insuring only the healthiest patients, he said.

Families with supposedly good coverage are just one serious illness
away from financial ruin, Woolhandler told lawmakers. She cited a study
she recently completed that showed that medical bills and illness
contributed to 62 percent of all personal bankruptcies in 2007.

Single-payer reform would radically simplify the payment system and redirect the vast savings to patient care, she said.

"Private insurance is a defective product," Woolhandler said. "A
government-run clone of private insurers cannot fix these flaws. Only
single-payer national health insurance can assure all Americans the
care they need at a price they can afford."

READ Wolfe’s testimony.

READ Woolhandler’s testimony.

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