Friday, August 21, 2009

Whole Foods and healthcare

On August 11 John Mackey, CEO of Whole Foods Market Inc. wrote a column in the Wall Street Journal on health care. This piece raised the hackles of a lot of health-conscious people who buy their food at that chain of stores, many of which, in New England, were formerly known as Bread and Circus before they were taken over by Mr. Mackey's Texas-based company.

The piece itself, which I comment on below, is mostly standard knee-jerk conservative business-speak -- you know: let business be business and "if only ordinary folk would make the enlightened decisions about their lives that my kind of people make, there wouldn't be any problem." The fact that Mackey is CEO of Whole Foods makes his remarks particularly galling, since most of his customers see through this claptrap and resent having to buy from a company that pays his salary.

Here are his main recommendations (italics indicate direct quotes).

1. Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs).

This is particularly disingenuous, since high-deductible policies are fine for wealthy people who have the ready cash to pay, in the case of Whole Foods, the first $2500. No problem for Mr. Mackey, but everyone knows that for most of us further down the salary chain, the effect is to put off seeing a doctor until our condition is pretty bad: high fever and bad pain etc. What could be a better example of the "Let them eat cake" attitude: Why can't they just pay the doctor's fee if they are so ill -- after all, we're trying to save money here aren't we?

My wife observes that this is particularly significant for a company like Whole Foods. Employees will put off the expense of a doctor's visit until they are feeling really bad. Thus, they will go to work while sick, at a store where they handle food and interact with customers all day long. Would you trust your health to such a store?

But, no matter for Mr. Mackey.

2. Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits.

In a vacuum, this principle is reasonable enough. The problem is that most of us who have health insurance have it through our employer. This is not the way it has to be, but is a relic of the unplanned, random nature of the way insurance has evolved in our market place. You'd have to have a pretty high income to provide your own insurance, which for even moderate coverage would run upwards of $1000 per month -- if you could find a group plan. Thus, in effect, Mr. Mackey is recommending yet another tax break for the wealthy, or a tax increase for the already stretched thin middle class. I'm sure that this fact is not lost on his WSJ audience...

3. Repeal all state laws which prevent insurance companies from competing across state lines.

Ah these Texans. In case you didn't know it, Texas has the laxest consumer protection of nearly any state. Many insurance companies there are chafing at the bit to sell their snake-oil policies out of state as well. These are the policies that don't cover pre-existing conditions, have high copayments on nearly everything, restrict you to a tiny list of doctors and disallow payments for nearly every procedure they can get away with under ... gulp ... Texas law. And, of course, it's all hidden in tiny print and incomprehensible language. Would you buy a used car by mail knowing Texas law? If you would, then you'll love their insurance policies.

4. Repeal government mandates regarding what insurance companies must cover.

Here we cut to the quick. The conservatives love to yell "government mandates." But, government mandates include Child Labor laws, Truth in Advertising, the Pure Food and Drug Act and the Americans with Disabilities Act. Darn those Feds for putting in wheel chair ramps and preventing the sale of dangerous drugs and chemicals across state lines.

One government mandate proposed is that pre-existing conditions be covered in health insurance. Apparently Mr. Mackey thinks that if you have heart disease or your kid has cancer or diabetes, the Feds should have no right to prevent your new insurer from refusing to pay for continued treatment. Nice guy, but hey, we're trying to save money here, right?

5. Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.

Tort reform, like government mandates, means lots of things. No one wants huge lawsuits over trivialities, but neither do they want victims of true malpractice and negligence to get screwed. In Texas, tort-reform has meant the latter, while examples of the former are fairly rare. If a hospital is lax in hygiene -- and many are as study after study has shown -- and this leads to a staph infection causing severe disfigurement, what does tort reform have to say? What about the removal of the wrong kidney, or a sponge left in the abdominal cavity? Depends on who wrote the tort reform law; I'd hate it to be the Texas legislature.

6. Make costs transparent so that consumers understand what health-care treatments cost.

No problem here. Same should hold true for the true costs of industrial pollution, excessive truck weight and risky behavior by banks.

7. Enact Medicare reform.

Yup, that's what Obama wants to do too. So?

8. Finally, revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation to help the millions of people who have no insurance and aren't covered by Medicare, Medicaid or the State Children's Health Insurance Program.

Aw shucks, we'll all chip in voluntarily to help those poor folks. Like we did for kids who worked in sweatshops for 60 hours a week; like we did for coal miners who got black lung disease or who were killed in unsafe mines; like we did for seniors who faced an old age of poverty and disease; like we did for the millions who had no electricity or plumbing in rural areas.

Puleeze. If it weren't for the New Deal and the labor movement, we'd be living in pretty bad conditions indeed. No amount of nickel and dime (dime as in what Mr. Rockefeller Sr. used to give to folks who inspired his charity) giving has ever, in America, gone far in fixing up the things that really needed fixing.

Mr. Mackey is either ignorant or a phony. I'd go with the latter. We're giving up on Whole Foods.

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