“The Bipartisanship of Fools”
June 22, 2009, 12:54 pm
Posted by Mollie Wilson O'Reilly
From a June 18 column by E. J. Dionne, just posted on our homepage:
Where did we get the idea that the only good health-care bill is a bipartisan bill? Is bipartisanship more important than whether a proposal is practical and effective? And if bipartisanship is a legitimate goal, isn’t each party equally responsible for achieving it?
Read the rest.
As in discussion of how Obama should act toward Iran, the discussion on health care seems to be more and more ideological,
The NYT poll yesterday shows clearly what Americans want (and in my opinion deserve) a plan including a public health plan.
After hearing the NPR report on the Senate this morning, though, I fear the outcome will be another ‘confederacy of dunces.”
An appeal to bipartisanship is code speak for “we’re in bed with lobbyists but we can’t admit it so we are going to say something that makes us sound like we might be virtuous when, in fact, we are even bigger whores than Republicans, who at least publicly agree with the companies that own them.”
Barbara, I disagree. “Bipartisanship” coming from Obama is code for: I’m going to make it look like everyone is involved, put the onus on them, take the credit when it succeeds, and have back-up blame when things (inevitably) fall short of expectations.
He’s positioning himself to make the first of several incremental changes that will ultimately result in a national single-payer system. He’s playing good politics by pretending to include an impotent gaggle of rivals while his policy behemoth prepares to steamroll towards what he really wants.
Thomas,
Thank you for your nonpartisan, objective analysis of Obama’s hidden, nefarious motives.
Let’s all look back fondly to the true bipartisanship of the Bush (43) era.
Yes, Thomas Jacobs, you say that like it’s a bad thing. As opposed to what the GOP has done with health care all these years, which is demonstrably a bad thing.
We really do need a single-payer system.
If Congress were somehow able to get such a package to Obama for signing, there is already regulatory authority for the government to hire insurance company employees familiar with health coding, etc. without having to go through the normal civil service examining process.
Specifically, see 5 CFR 316.701, Public or Private Enterprise Taken Over by Government, and 5 CFR 315.701, Incumbents of Positions Brought into the Competitive Service.
Such an approach could conceivably take some of the “sting” out of a job change for such folks who could be relied upon to use their knowledge to help people get the care they need as opposed to screening them out of coverage.
If other industrialized countries can support universal, single-payer healthcare, so can we. I find it a huge embarrassment that we — to this date — lack such a system. As a registered Independent voter who lives in Kentucky, I’m embarrassed by our Senate minority leader’s continual obstructionism, not just with respect to healthcare but to other progressive legislation, as well.
For those who were not familiar with Bob’s reference above …..
“When a true genius appears in the world, you may know him by this sign, that the dunces are all in confederacy against him.”
Jonathan Swift, Thoughts on Various Subjects, Moral and Diverting
(You can always count of me to be unfamiliar with much of that which you are familiar.)
This week’s Time magazine has an interesting article about the “Mayo Way,” i.e., the cost-containment policies implemented at this world-class health facility without reduction in effective care.
The article’s worth a read:
http://www.time.com/time/politics/article/0,8599,1905340,00.html
Conservatives who criticize Obama’s plans for health care seem to forget that they have told us with great certainty that Obama — in addition to approving of infanticide — is going to exterminate the sick, the elderly, and the disabled. We have heard this from them time and time again. And yet when they criticize the Obama health care plans, they never even allude to the enormous cost savings this will bring about for private insurers, Medicare, Medicaid, not to mention Social Security and a host of other nonmedical government programs.
Another shortfall of the blog post format – By no means do I think that the way Obama is making his move is a “bad thing.” I campaigned for the man because I believed he had the requisite political skills to push through an agenda I wholeheartedly share. Obama’s probably one of the sharpest political minds we’ll see in our lifetimes. I expect him to play hardball, and he does so brilliantly.
I was only trying to point out that he isn’t really in bed with lobbyists – if anything, they have to get in bed with him, because he’s running this government on his own terms. I’m just glad he’s on my team.
I just found out this weekend that 30 million of the 45 million uninsured would opt out of any plan.. These are mostly younger people who have never had a personel need for care?
Is mandatory insurance the only way to go? [With a religious exception e.g Christian scientists] ….mandatory ins. like car insurance, at least in California..
Mr. Dionne’s analysis actually seems rather correct in large part. The differences between the Ruling Party and the minority are on this topic are irreconcilable and if the Ruling Party think the people want Federalized health insurance, they should deliver it to them. If the people don’t like what they have been given and its ancillary effects, they can try to assert their opinion for the mid-terms and in 2012.
Thomas–
Thank you for your partisan, subjective analysis of Obama’s overt, virtuous motives. ;)
That’s better!
[With a religious exception e.g Christian scientists]
Ed,
Christian Scientists do not shun all medical treatment. Check out this fascinating segment from Religion & Ethics Newsweekly about faith healing. We learn that more than 30 states have exemptions that let parents off the hook if their children die because they choose “faith healing” over conventional medical care. I have recently been arguing that abortion is similar in that it gives parents the power of life and death over their children. I would love to see this debated, but so far no one has been interested.
Yes, I know. Letting a children suffer and die when they could be saved by medical treatment is not morally equivalent to direct killing. However, tell that to the dead kids.
Thomas,
Apologies for misunderstanding your comments about Obama.
Mr. Collier – I try. :)
Mr. Nickol – No worries. I believe I’ve misconstrued your comments, too, recently.
Cheers. ~T
[Hi, Mollie, fwiw, the link embedded in "the rest" above doesn't seem to be working for me. But I was able to get to the column from the Commonweal home page.]
I agree with Dionne that the two parties’ approaches are so vastly different that they are on different planets, and I don’t see how to reconcile them.
FWIW, the Republicans’ preferred plan, with expanded Health Savings Accounts and higher deductibles such that consumers rather than insurance companies absorb more of the costs of routine, primary care – reads very much the same as what was pushed by the Bush Administration in the aftermath of the 2004 election. That didn’t go anywhere, in either a partisan or bipartisan fashion.
There are actually two enormous problems: (1) the costs for health care in general – for the insured and the uninsured – are out of control; and (2) there are nearly 50 million people with no health insurance at all and so for whom the only healthcare option is a vist to the public hospital emergency room. Istm that the Republicans’ plan addresses (1) but doesn’t have a lot to say about (2), whereas the Democratic legislation currently brewing addresses (2) but nobody believes their claims about (1).
As Catholics, shouldn’t (2) be our primary concern? But check out this piece by William Galston, which suggests that the public is navel-gazing.
http://blogs.tnr.com/tnr/blogs/galston/archive/2009/06/04/why-won-t-obama-tell-us-about-the-cost-of-health-care.aspx
A few minutes ago I received a phone call from a representative of The Right to LIfe Association, of which I have been a supporting member. The caller asked me if I was aware that “the Obama health care plan”, (his words), would force taxpayers to provide funds for abortions. I opted out of this battle, and cut the conversation short. I thought it might be of interest to the group that this campaign has begun.
Thanks, Jim – I fixed the link.
David Brooks’ column in the NY Times this morning talks about the Wyden/Bennett bill for health care reform that seems to:
* Have broad bipartisan support
* Is projected by the CBO to be revenue-neutral over the next ten years
* Would provide health care for those currently without insurance
* Apparently has no chance for passage because Baucus and the Senate leadership didn’t think it up themselves
This is enough to make me scream.
http://www.nytimes.com/2009/06/23/opinion/23brooks.html?th&emc=th
I’m an executive for one of the largest national private health insurance companies.
I don’t see how the public option would work. First, Medicare and Medicaid are subsidized by private insurance as it is. If the Feds are thinking of using a Medicare pricing structure for claims, then the current financing system collapses. Of course, it could be replaced by something else. But I also can’t see the major providers supporting the movement of most of their business to a Medicare fee schedule.
Eliminating the “profit element” is a red herring. Much of the private insurance system is non-profit now. I don’t think we see real differences in insurance pricing or levels of coverage between states that have mostly for profit companies and states (like Minnesota) that are mostly non-profit.
I do think that single payer would be the most rational system. But when I see people talk about reforming (or replacing) the current system, they often leave out on of the significant interest groups, which is the doctors and hospitals themselves. The costs that are increasing out of control are hospital and physician costs. These only pass through the insurance companies. It is not as if the costs would go away if the insurance companies went away.
I guess I agree that a single payer system would be best, but the ideolgues are still too strongly bonded against it. And, it would mean everybody, including oldtimers like myself, would have to sacrifice something.
It also means we’d get serious about cost and benefit standardization – a hard word for many.
Unagidon,
Couldn’t the public option be the narrow end of a wedge that would eventually lead to a single-payer system? When the public sees that the public option is cheaper and no worse than private insurance, more — then maybe most — of them will opt for it. As more opt for it, it will have even more bargaining power with hospitals and drug makers. Obviously this isn’t the way Obama is talking about it, but isn’t it likely to work that way over the course of a decade or two, if the private system is as inefficient as you have said it is? And wouldn’t a wedge be required in any case? The insurance companies aren’t going to volunteer to close shop.
Matthew, wouldn’t it be employers dumping private insurance, rather than the public, that would drive the wedge in this case?
Matthew said: “Couldn’t the public option be the narrow end of a wedge that would eventually lead to a single-payer system? When the public sees that the public option is cheaper and no worse than private insurance, more — then maybe most — of them will opt for it. As more opt for it, it will have even more bargaining power with hospitals and drug makers. Obviously this isn’t the way Obama is talking about it, but isn’t it likely to work that way over the course of a decade or two, if the private system is as inefficient as you have said it is? And wouldn’t a wedge be required in any case? The insurance companies aren’t going to volunteer to close shop.”
Yes, if the “public option” were, in fact, cheaper. I’m just not seeing how it would be, unless it is heavily subsidized by the government (that is, sold for less than cost). And if it were, then of course it would undercut private insurance, but you would not have solved for the cost problem.
The profit margin (as opposed to net profit dollars) is low for the private insurance industry. But even so, if profits were eliminated, then the non-profits that exist now should be much cheaper than for-profit insurance. But they aren’t.
There are some who say that the difference will be made up in costs based on the idea that Medicare is more efficient in its claims payment operations than private insurance. This is based on an idea that the percentage operating (claims payments and SG&A) costs for Medicare are much cheaper. A recent Commonweal threw around something (I don’t have it in front of me) like 2% of claims costs for Medicare and something very large for private insurance (say 15% of claims costs). To this they also added something like 15% of claims costs to the physician side to say that total private insurance costs eat up like 30% of premium dollars.
This is not actually how it works. Medicare costs are a lower percentage not because they are more efficient but because for Medicare we are generally talking about more dollars per claim. Claims processing costs are relatively fixed. Second, provider claims costs would not go away entirely, ever, and would still continue at the same rate unless we went to a single payer system on a single claims payment platform. This would be the end product of a switch to single payer, not a savings that could be realized up front to fund a single payer system.
But all that aside, what happens when a huge proportion of US providers switch from a reimbursement rate that is equivalent to 110% to 200% of the current Medicare fee schedule to a government plan that pays 98% to 100% of Medicare? The medical profession will not allow this. Also, from where I am sitting, the people that would switch to a public plan would be those who are paying the most for their private plans. These tend to be the sickest people who are now reimbursing providers with the most dollars at the highest rates. How would the public plan maintain their cost position vis a vis the private plans if this happened (which we think in the industry would happen).
I have argued to my colleagues that the private insurance industry could get out of the risk business altogether and just to claims processing and cost control stuff and still make money. I personally believe that this is where we will end up in the long term.
“I just found out this weekend that 30 million of the 45 million uninsured would opt out of any plan.. These are mostly younger people who have never had a personel need for care?
Is mandatory insurance the only way to go? [With a religious exception e.g Christian scientists] ….mandatory ins. like car insurance, at least in California..”
Yes, it should be mandatory. Insurance of any sort is no more and no less than the spreading of risk.
But in addition, the only way this would work is if people were simply allowed to die on the street, say, as they do in Calcutta. What we have now are legal requirements that people be seen in emergency rooms whether they can pay or not. A good thing, but it sets up a free rider risk if people can opt out of paying for health care and still get it anyway.
The purpose of health care reform is to benefit the citizens of this country, not the insurance/pharmaceutical/medial industries.
If they can’t compete then they deserve to be labeled as buggy whips and go sit in the corner until they learn how to compete.
The insurance companies are all for universal coverage as long as it means everyone has to buy insurance from them. Whatever you think of mandatory auto insurance, at least it’s conditional — if x, then y. In this case: if you want to own a car, you need to buy insurance. What is the x in the case of health insurance? And please don’t say “If you don’t want to pay a tax or fine.” If the government wants to require health insurance, it needs to offer it too. Unagidon may be right that the relative administrative efficiency of Medicare has a lot to do with the average size of the claims it processes, but the administrative costs of government and government-sponsored health insurance programs in other countries with better health outcomes are also lower. Why? Partly because the governments — aka “single payers” — in those countries are in a better position to control costs. More important, they’re in a better position to make decisions about which costs to accept. The underlying question is this: What system is more likely to ration health care rationally, a public program whose only concern is public health, or a private company whose first concern is profit. Private nonprofit insurance companies must work within a system whose rules are largely controlled by for-profit corporations.
Matthew said: “Partly because the governments — aka “single payers” — in those countries are in a better position to control costs. More important, they’re in a better position to make decisions about which costs to accept. The underlying question is this: What system is more likely to ration health care rationally, a public program whose only concern is public health, or a private company whose first concern is profit. Private nonprofit insurance companies must work within a system whose rules are largely controlled by for-profit corporations.”
I am not sure that it is strictly true that the government is in a better position to control costs. Or rather, the government is in a better position to control costs by mandating certain levels of reimbursement, which is how Medicare “controls costs” now. But in the US, this creates a political problem. Which is fair enough, but it enlists the hospitals and doctors against any real health reform.
Your second point about rationing also points to a political problem, of course. People not only want universal coverage, they want more coverage with less out of pocket expense. They don’t want rationing. But costs on the provider end IS the problem.
Your note on the profit motive contains, I think, an assumption, which is that insurance companies make profits by restricting care. This is not true. Or I should say, not true in the way the people put this about. Insurance companies do not deny claims in order to make profits. It is illegal to do this for one thing. Insurance companies make most of their profits by controlling costs. If you don’t have to go into the hospital for ten days to have your appendix removed (as I did 35 years ago) you can thank insurance companies, not the hospitals and not major advances in appendix removal technology.
For your point about who controls the rules, you are simply wrong. No one entity controls the rules. The system has three legs; insurance companies, healthcare providers, and drug companies. Each one contributes part of the malfunction. Since the malfunction consists of causing certain kinds of costs and risks to be shifted in a certain way and since the malfunction also creates certain kinds of bad incentives, we have the system that we have to do. But you can’t fix the system by fixing only one of the legs. The chair will fall, as I have already noted when talking about financing above.
Jimmy Mac said: “The purpose of health care reform is to benefit the citizens of this country, not the insurance/pharmaceutical/medial industries.
If they can’t compete then they deserve to be labeled as buggy whips and go sit in the corner until they learn how to compete.”
The government setting up a subsidized government insurance company that they pretend is a business isn’t competing any more than a military PX can be said to compete with the local Target. And therein lies the problem.
Hi Unagidon, I don’t want to wade in too deeply, but as I see it, there are really two fundamental problems that need to be fixed, and that government is in a better (hardly perfect) position to fix than private insurance.
The first is ending the insanity known as RBRVS that so seriously undervalues primary care services, and which sets up a system in which a disproportionate number of doctors become specialists, and in which pcps are so harried that for many patients, they simply refer to a specialist if anything looks complicated. This has happened even to me (but I didn’t go to the specialist, having already gone that route — I told the pcp what tests I needed.)
The second, probably even more fundamental, and yes, an outgrowth of the first: no one trusts anyone, not insurers and not doctors, who tell them the truth about what they need. So when we say “everyone wants everything” to a certain degree that’s true because no one trusts the person or entity telling them that something won’t work. Winning back that trust is virtually essential to controlling costs.
Of course, there are lots of other more “technical” steps that could be taken:
prohibiting, and I mean, really prohibiting that pernicious practice known as “self-referral.”
Comparative effectiveness studies, true post-market studies backed by actually taking devices and drugs off the market if they are not done. Etc.
One of the really frustrating things I have seen in my 20 year career is that early managed care companies really did have an integrated approach to treatment that now very few exhibit — Kaiser and Geisinger and a few other traditional HMOs. Some hospital systems (i.e., in Minnesota) are also very good at this.
What happened? Well, employers desperate to control costs tried to force employees into arrangements that they weren’t ready for, commercial insurers took up the mantle but with a much keener eye to the costs than the benefits of the system — and seriously, and I mean really seriously, overreached in their dealings with providers.
Also, less talked about, many of the doctor owned plans were sold to the highest bidder and lost their mission in the process, though the doctors made out quite well.
Of course, when the backlash occurred, the baby was thrown straight out with the bathwater so that many insurers basically now do little more than move money around in pots and try to keep the sick out or down, and in many states the situation, basically, is that a dominant insurer shares monopoly rents with a dominant provider, who can never be bothered to invest in technology unless they can bill for it.
All this harping about what Medicare pays, what costs providers actually incur, blah blah blah, I’ve been listening to this for so long I just stick my fingers in my ears: we DON’T KNOW because the system — its costs, its financial incentives, its business imperatives are so distorted by the need to rob Peter to pay Paul we have no idea whether Medicare payment is fair. We are going to have to get universal coverage with serious government teeth and THEN we can talk to the provider community about what they really need. This isn’t going to be turn key.
Unagidon –
If Pres. Obama asked for your advice, what advice would you give him? Short term and long term.
One question from me: how much of our gross national income do you think we would have to spend on the health care system for everyone to get excellent health care? (Whatever the answer, I’m not sure everyone will be willing to pay the necessary taxes.)
“Whatever you think of mandatory auto insurance, at least it’s conditional — if x, then y. In this case: if you want to own a car, you need to buy insurance. What is the x in the case of health insurance? And please don’t say “If you don’t want to pay a tax or fine.” If the government wants to require health insurance, it needs to offer it too. ”
To be logically consistent, istm we could apply the single-payer philosophy to the auto insurance market. Wisdom tells us that all drivers need auto insurance, because auto accidents damage property, cause injuries and result in lawsuits. But some people don’t buy auto insurance, or they do buy insurance but later allow their coverage to lapse, even despite legal compulsion. Why? Because they’re not wise, or they’re cheap, or they’re poor. Absent a state law mandating coverage, some would also be deemed uninsurable by the insurance carriers.
The single-payer philosophy would look at this situation and reply, ‘Clearly there are imperfections and dysfunctions in the marketplace, because not everyone who should have coverage has coverage. Therefore, the best solution is for the government to provide auto insurance to all drivers. Consider the benefits: all vehicles and drivers would be insured, eliminating lack-of-coverage nightmares; insurance premiums would cost the same for the poor as the rich; and profit-driven auto insurance providers would no longer have a motive to deny worthy claims.’
Yet we haven’t adopted that system. We’ve imposed some constraints on drivers (you must have insurance) and some constraints on the carriers (you must offer insurance to everyone). The system isn’t perfect – some drivers who are in accidents are not insured – but it is better than was the case before those relatively modest constraints were imposed.
And it’s worth considering what we’ve avoided: we’ve avoided erecting huge new government bureaucracies that would become political employment plums for hacks and stooges; avoided adding an enormously expensive government entitlement that governments clearly can’t afford; and avoided dismantling profitable industries that employ many hundreds of thousands of workers at good wages.
Barbara, yours is a good overall analysis of what’s going on. I would disagree with a bit of it, though, but remember that I am talking as an insurance company executive.
RBRVS (and DRG payments for hospitals) are two means that the government uses to standardize payments for providers for services based on a sort of case rate methodology. The idea is to group things together that tend to cost the same (since there are a trillion separate medical procedures in fact) and set up an “average” reimbursement rate for them based on a universal payment schedule. The government also uses this payment methodology to encourage doctors and hospitals to become more cost efficient by slightly underpaying them by even their own (government) calculation. The idea is that a standard fee schedule will be more cost effective to administer (and it is) and that providers will make more money if they lower their costs relative to the fee schedule over time.
The defect that you outline is that the system creates a systematic incentive for providers to resort to more or more expensive treatments. Aside from that, since it is a sort of “spread the peanut butter” approach to health care payments, there are pay inequities (both ways) at the local level.
Part of the reason that private insurance claims processing is less efficient than the government’s is that because of the reimbursement problems of the standard government schedule, providers don’t want to use the same standard schedules from private insurance companies. So providers often (if they can) insist on non-standard payment schedules in their negotiations. If they are dealing with 8 or 10 insurance companies in a market, they will end up with 8 or 10 separate non-standard fee schedules and all the administrative hassle that goes with that.
The problem with eliminating RBRVS and DRG is that a government entity that pays all providers in the US probably HAS to pay in this way. The government cannot negotiate separate contracts with everyone and keep this supposed advantage they have in their operational costs. Ditto for the government’s “cost savings” approach where they systematically underpay everyone and hope that the providers conform. Right now, providers make up the difference from private insurers and the poor individual suckers that self insure. This private sector subsidy would disappear if the US adopted some sort of “public plan” and the current financing system would collapse.
One of the services that insurance companies provides (and which is the real source of their profits) is that they can track the efficiency of individual providers and individual service costs and promote, if not force, compliance to the most efficient procedures. (When and insurance executive says “most efficient procedures”, people generally rush to the conclusion that what we mean is “cheapest procedures”. But remember that for an insurance company, a procedure that doesn’t work to make the patient well is more expensive for us in the long run than one that does. We really, really know this.)
A second general point that you make isn’t made enough. People are talking about forcing competition between insurance companies. Actually, they should be talking about forcing competition between hospitals and between physicians. For all this talk about a “free market” for health care in the US, we don’t really have one in the sense that we have one for automobiles, say. It is very hard for someone not in the insurance business to get comparative cost and quality information about doctors and hospitals. One can get real general stuff, but it’s like choosing a car solely on the basis that Ford makes a better car than Honda, without regard to models, local dealers etc. It is the medical industry that does not want this competition to happen and this is what is actually driving up medical costs.
Ann, what we should do as a nation is address the problem as a whole. What we tend to do is break a problem into a zero sum game of competing interests and may the richest one win. It probably is a good thing for Obama to be considering throwing a hand grenade into the mess. But every proposal I have seen is incomplete and almost all of them are supported by some interest that wants to pass costs or risks away from themselves and onto someone else. So we are going to have a long way to go and things may get much worse before they get better.
Jim, the difference is that, if some schlub cracks up his car and doesn’t have insurance the public at large does not feel compelled to replace it. He can take the bus, thank you very much.
Same for life insurance: if you leave your family unprotected so they have more difficulty making the mortgage or paying for college, that’s your (or their) problem.
Whereas, if you are injured or become sick, we do expect our local hospitals and doctors, somehow, to save us, even if we have been willful or naive in failing to secure health insurance.
That’s a profound difference.
Jim, insurance would have to be mandatory because if it isn’t, those who don’t have it and who don’t want to pay for it will pass their catastrophic health costs onto everyone else anyway. One might be willing to pay out of pocket for routine care (but people are fooling themselves if they think they can negotiate a good price with a provider all by themselves). But not willing to be insured against the big stuff is simply a gamble with no down side for the gambler unless we change all of our safety net laws and say that if you have that bad motorcycle accident and don’t have catastrophic insurance, we will just move your broken body out of traffic so you can die in dignity on the side of the road.
I am grateful to Barbara for the best analysis here. Her view, in my opinion, is driven by the common good and where the starting point should be.
I would only add an anecdote from the land of Enchantment(NM) where for four or five years now, a real universal health plan has been killed by the executive with a mighty push from his insurance company supporters who need “their voice at the table.”
Did someone say”pay for play?”
A fortiori in Washington…
Bob, you are assuming that insurance companies do not provide a service. They in fact do. They are the ones who actually get hospitals and doctors to keep their costs down. Hospital A has no incentive to lower its costs relative to Hospital B right across the street from them. The incentive is produced by insurance companies. This is simply a fact.
It is this role that would have to be replaced by any government entity that replaced the private insurers. So far, aside from bromides like “government could use its superior purchasing power to get a better deal” I have seen no plan. The government does not use its negotiating power now with Medicare because the government does not negotiate.
The point is, insurance companies in their role of middlemen do a lot of necessary hospital and physician group level cost and quality monitoring that needs to be done by someone. Jim P is half right that for the government to take this over entirely would mean that a very large bureaucracy would be created. Half right because 1) I don’t accept as a business man that government does it more poorly than business, because I don’t believe in the idea that greed is the only stimulator of quality work and 2) I don’t see anything in the government’s plans that they will take over the cost containment work that is being done by insurance companies.
Hi Unagidon:
Regarding payment:
I would never scrap the DRG. The DRG, by and large, really worked. What’s hard is coming up with a comparable approach for physicians. RBRVS gave order and proportionality to the compensation of physicians, but it took as the starting point for the valuation of physician services what physicians put into the service — not what the public wants out of physician services. So judgment is completely underpaid while doing LOTS OF NEAT STUFF, even if it is unjustified or gets horrible results, is highly compensated.
Regarding insurers:
I agree that insurers actually could add value — they are far more nimble than Medicare and far more capable of collecting and evaluating information and devising plans and programs that could address real problems or inefficiencies. The problem is twofold. First, they are also driven by the bottom line, so that, along with the valuable stuff, they also do some stuff that is very difficult to justify. Second, in disagreement with your conclusion, they actually have very little power or authority to make providers go along with measures that effectively call them out for engaging in ineffective or unjustified services, and one reason why they don’t have that power is because it is very easy to, as you say, demonize demands for efficiency as rationing to save the bottom line. This leaves them open to the kind of backlash that has occurred — they are extraordinarily useful enemies to providers who sure as heck don’t like exposing their own soft underbelly of useless medical procedures and outrageous pricing.
I just don’t think forcing everyone to buy insurance will turn this ship around.
I’m grateful for the quality of the conversation here – best one we’ve had here on this extremely important topic.
“I just don’t think forcing everyone to buy insurance will turn this ship around.”
Which ship, though? The costs-are-out-of-control ship, or the some-people-don’t-have-insurance ship? Aren’t these two ships opposed?
“Jim P is half right that for the government to take this over entirely would mean that a very large bureaucracy would be created. Half right because 1) I don’t accept as a business man that government does it more poorly than business, because I don’t believe in the idea that greed is the only stimulator of quality work and 2) I don’t see anything in the government’s plans that they will take over the cost containment work that is being done by insurance companies.”
I will gladly accept half a loaf from you on this, Unagidon :-)
I suppose that I believe that both government and businesses are staffed by poor sinners, and neither type of employee or director is inherently more virtuous than the other. However, over time, a monopolistic government will do things more poorly than a business that must thrive in a competitive market, partly because competition does drive efficiency and responsiveness to consumer demand, and partly because politicians, also being poor sinners, can’t resist meddling in government programs for political rather than citizen benefit.
The ship of out of control costs arises out of a system that pays professionals on the equivalent of a piecework basis without regard to need or utility. It leads to underinsurance and no insurance. The cost of this is diffused because for most people who are insured, costs are rendered invisible, but it is absorbed through lower pay raises, fewer employees eligible for health insurance, and so on.
What I am saying is that forcing people to buy insurance won’t address the weaknesses within our system that made it unaffordable to begin with.
Barbara said: “What I am saying is that forcing people to buy insurance won’t address the weaknesses within our system that made it unaffordable to begin with.”
I don’t think that people should be forced to buy insurance. However, in either a single payer system or in a system that has safety net laws for ill or injured people, people who are don’t buy insurance gambling that they won’t need it end up being covered by everyone else. It’s a free rider thing. (But I am not saying that this is the sole reason that people would not buy insurance).
Let me clarify: I’m okay with mandates provided that the mandate is made part and parcel of measures that actually reform the status quo and I doubt if such reform simply by requiring people to purchase private insurance.
I agree, Barbara, but please don’t let my colleagues know.
http://www.americanprogress.org/issues/2009/06/health_payment_reform.html
Good article, Barbara. And I will point out to Jim P that all of the things mentioned in it could be privatized in the way that government will build roads or airplanes using private companies.
Unagidon –
When you say “privatize” health care what do you have in mind? We already have a private system (except for Medicare and Medicaid payments), so how would you privatize the rest? Would some private companies be paid to handle hospital and hospice care, perhaps others would keep central records, others organize doctors into private compaines of specialists? etc. Or what?
I just can’t imagine how such a system would be structured.
Barbara and Unagidon, I read the executive summary at Barbara’s link to be recommending capitation and managed care, i.e. the re-HMO-ization of the healthcare system. Is that a fair characterization?
Ann, go here for information on health care spending: http://www.chcf.org/documents/insurance/QuickReferenceGuide09.pdf
Government resources account for just under half of the so-called health care dollar. Private insurance accounts for under 35%. The rest is either out of pocket (12%) or other private, which, I presume, includes charitable foundations that fund medical care.
Other public health spending includes TRICARE, VA, IHS, and federal and state employee health benefit programs.
I would add to Barbara’s comment that there is probably more than enough money flowing through the entire system right now to fund single payer.
To Ann, the physical administration of claims and the monitoring of price and quality could be subtracted out, with the government taking on the claims risk itself.
For those who claim that a public plan would lead to efficiencies of size and to market power in negotiation, I will retort that the first is theoretical and in the second case, the government doesn’t negotiate now. The negotiation and monitoring of contracts is one of the main differences between the government’s and the private insurance companies overhead expense.
To Jim P, I would say that answer is, more or less, yes. But the HMO model was pretty good at both coordinating care and controlling costs. (Not, as some think, by denying claims.) But HMOs were instrumental in controlling medical cost trends for a couple of decades in the US. The HMO thing probably merits a separate discussion.
Thanks, Barbara. The complexity of it all boggles the mind! I used to tell myself that Social Security is so well-run that it shows that the feds can be super efficient. But I wonder. Social Security claims are relatively so very simple. My nephew worked as a programmer for the Navy working on automation of health records. I’ll have to ask him how he sees the complexity problem.
Unagidon –
This is all so complex. I wonder if the systems philosophers, who generally have an AI background, are working on this. What a project!
I have a last question:
How much of a role will and should lobbyists play im shaping any health care reform (see Andrea Seabrook’s report at the NPR website.)?
And for all our theollogians/ethicists, what constraints does moality/common good place on lobbysits ideally and in fact?