Guiding Principles

The world pauses this week to reflect on the transformative leadership and inspiration of Pope John Paul II who devoted his life to spreading the truth about human dignity and the essential importance of following moral principles. The outpouring of affection throughout the world for the Holy Father shows how hungry the world was for his message.

In the midst of these reflections, it seems an appropriate time to take a moment to say a word about the moral basis for the work we do here at the Galen Institute.

The absolute essence of our work is based on respect for human freedom and the dignity of the individual. As we have seen so painfully over these last few days, health care and our control over life and death decisions are central to our freedom and human dignity.

When people are seriously ill or injured, they are at the mercy of the medical system to provide them with what often is life-saving care. And they are even more at the mercy of the system if they don’t have the means to pay for the care they receive. Their choices are often limited and their anxiety is exacerbated by financial concerns.

But our mission to help people gain security in accessing medical care has become not only a moral debate but, unfortunately, a political one as well. One side sincerely believes that the only real security lies in a health care system organized by government, and the other believes that the only real security lies in a system built around individual freedom and choice.

These debates will continue, but at this moment in history, it is appropriate to remember that we do have common goals. All of us want to find a way to make sure everyone gets the health care he or she needs, that they are able to have control over decisions and choices, and that the doctor-patient relationship is restored.

New alliances and agreements over policy prescriptions are forming and may provide a new path that can end the struggles that have left us gridlocked over solutions for more than a decade.

As we celebrate the life of Pope John Paul II and his adherence to moral principles, we will do our best to shed a new light on this debate to move beyond the divisions of the past and find new solutions for the future.

Grace-Marie Turner


  • Piecework: Medicine’s money problem
  • Childbirth for bargain-hunters
  • Revamp Medicaid to help minorities fare better
  • Health care tax to target big employers
  • Our competitors understand why America is the global leader in biotechnology. Why don’t we?
  • Trusting brands in society: The quality and value of modern medicine
  • National healthcare quality report

Author: Atul Gawande
Source: The New Yorker, 04/04/05

The New Yorker (of all places) portrays a young surgeon’s questions about the business side of running a medical practice. Dr. Atul Gawande details his colleagues’ struggles with third-party payment systems, both private and public, and the expense and frustration of complying with endless payment rules. His biggest surprise is finding a senior surgeon who makes about $1.2 million a year by accepting only cash customers. His patients can apply for reimbursement to their insurance company, but this unnamed surgeon “doesn’t see why doctors should let insurance companies dictate their compensation.” Because he’s “something of a star in his field,” instead of the $700 that insurance pays for a laparoscopic cholecystectomy, the senior surgeon charges $8,500. But Dr. Gawande concludes: “I can understand wanting to escape the insurance morass. But isn’t there some other way around it?”
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Author: Vanessa Fuhrmans
Source: The Wall Street Journal, 04/05/05

“Pregnant women are by necessity and ingenuity paving the way in what is called ‘consumer driven’ health care,” writes Wall Street Journal reporter Vanessa Fuhrmans. A growing number of women are shopping around and negotiating better prices on maternity care because their health plans do not include maternity coverage or because they have higher deductible plans. “As a result, these women are forced to navigate a murky system of health-care pricing and to make medical decisions based as much on checkbooks as maternal instinct,” writes Fuhrmans. In one example, a third time expectant mother reviewed the prices her insurer paid for her second pregnancy and found they were significantly lower than the cash prices she was being quoted. “When she asked for the same deal on her current pregnancy, one obstetrician complied,” writes Fuhrmans. “When she asked another doctor’s practice to match it they did, cutting the usual $3,000 fee to $1,900.”
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Authors: Newt Gingrich and James Frogue
Source: The Atlanta Journal-Constitution, 04/07/05

Medicaid fails to deliver quality health care to minorities, especially African-Americans, write Newt Gingrich and Jim Frogue of the Center for Health Transformation. Health inequalities in Medicaid “remain stubbornly persistent” despite “marked progress in closing the black/white gap in civil rights, housing, education and income since 1960.” For example, “relative to whites, infant mortality rates are 2.5 times higher for blacks, life expectancy is 10 years less, and blacks have significantly higher mortality rates from heart disease, stroke and cancer.” Medicaid’s structure, write the authors, “is biased in favor of a rigid status quo” which segregates beneficiaries into “second-tier health care, and that is a second tier with demonstrated costs in lives and in quality of life.” The program should be revamped into a “system that is outcomes-oriented, not process-based. Those outcomes should include a clear and measurable commitment to eliminating the disparities in health outcomes between different groups of Americans,” conclude the authors.
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Author: David Nitkin
Source: Baltimore Sun, 04/06/05

Both houses of the Maryland state legislature have approved legislation that would force large companies to make a mandatory contribution to employee health benefits or pay a tax to the state, according to a report in the Baltimore Sun. The Fair Share Health Care Fund Act requires companies with 10,000 or more employees to spend at least 8% of their payroll on health care or pay a levy to the state. “As a practical matter, four large Maryland employers would be covered by the bill: Wal-Mart; Giant Food Inc.; [Johns] Hopkins [University]; and defense contractor Northrop Grumman,” the Sun reports. “But only Wal-Mart would be required to pay the tax because it does not reach the 8 percent threshold.” Although this measure would currently only affect one employer, “smaller businesses worried that the measure could be altered to include them in the future.” Governor Ehrlich promises to veto the bill, but supporters say they have enough votes to override his veto. An override vote would not be taken until next year’s session.
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Author: Robert Goldberg, Ph.D.
Source: Medical Progress Today, 04/04/05

American dominance in biotechnology could be challenged as “our policymakers seem increasingly tempted to forfeit our lead through price controls, which will only drive vital biotech investment abroad,” writes Robert Goldberg of the Manhattan Institute. Other countries recognize the potential opportunities and are “moving to embrace our model for market pricing and trying to find ways to rid themselves of burdensome price controls in order to attract more investment,” warns Goldberg. “India recently voted to strengthen the intellectual property protection of biotechnology and pharmaceutical products as a way to encourage more venture capital and risk taking among drug companies,” writes Goldberg. And “Europe is considering a phaseout of laws allowing distributors to import drugs sold in a country with low reimbursement levels for drugs (like Spain) to a higher priced country (like England) to make a profit on the mark-up.”
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Authors: Dr. Tim Evans, Dr. Sean Gabb, Alberto Mingardi, Stephen Pollard
Source: Centre for the New Europe, 03/22/05

“Often unduly alarmed by unscrupulous media hype and political scare mongering, society now faces?a real and urgent need to rebuild trust between people and the medicines they use,” write Dr. Tim Evans, Dr. Sean Gabb, Alberto Mingardi, and Stephen Pollard of the Centre for the New Europe. Consumers often lack confidence and trust in new medicines, despite the “series of stringent tests and regulations” that medicines are subject to at every stage of development. “Fuelled by populist tales of pharmaceutical companies engaging in ‘excessive profiteering’, the production of ‘dangerous products’ and generally ‘unethical behaviour’, much criticism of the research-based pharmaceutical industry seems to proceed from a general and?inappropriate hostility to private business and a lack of understanding about the industry,” conclude the authors. “People must be encouraged to better understand the real benefits of the research-based industry and the medicines they produce?their trust and confidence should be re-built via an active agenda of education and open communication.”
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Source: Agency for Healthcare Research and Quality

Health care quality is improving in many areas, but further improvements can be made, according to the second annual National Healthcare Quality Report, released by HHS’ Agency for Healthcare Research and Quality (AHRQ). The report measures health care quality across four key areas including patient centeredness, timeliness, effectiveness, and safety, and tracks data on the quality of nine clinical condition areas or care settings, including cancer, diabetes, heart disease, and nursing home and home health care. According to the report, the largest improvements were: “A relative decrease of 37% in the percentage of nursing home patients who have moderate to severe pain?A relative decrease of 34% in the hospital admission rate for uncontrolled diabetes? [and] A relative decrease of 34% in the percentage of elderly patients who were given medications potentially inappropriate for the elderly.” Nonetheless, the report concludes that “the gap between the best possible care and actual care remains large?highlighting opportunities for improving the consistency with which health care is delivered.”
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9 Million Fewer Uninsured?
AEI Health Policy Seminar
Friday, April 8, 2005, 9:00 a.m. – 11:15 a.m.
Washington, DC
For additional details and registration information, go to:

Kaiser Conversations on Health: Virginia Gov. Mark Warner
Kaiser Family Foundation Webcast Event
Thursday, April 14, 2005, 11:30 am ET
Governor Warner will discuss proposals to alter the Medicaid program, the future of long-term care, and other state and federal health and social issues. Watch the live webcast on at

Should Government Fix Drug Prices?
Co-hosted by the Manhattan Institute & The Heritage Foundation
Thursday, April 21, 2005, 12:00 noon
Hart Senate Office Building, Room 902
Washington, DC

RSVP online to Tim Chapman, Deputy Director for Senate Relations at

Health Policy Matters is a weekly newsletter containing summaries of timely and informative studies and articles on free-market health reform. It features research and writings by participants in the Health Policy Consensus Group, articles of interest from the health policy world, and announcements of coming events. Health Policy Matters is published by the Galen Institute, a not-for-profit public policy organization specializing in information and education on health policy. For more information about the newsletter and our organization, please visit our website at

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The views expressed in this newsletter are the opinions of the authors and do not necessarily reflect the views of the Galen Institute or its directors.

Elizabeth Lamirand, editor