I’m going to admit to being pretty bummed about the prospects for healthcare reform worthy of the name at this point. It certainly seems to me as though the White House and both sides of the aisle in Congress have talked themselves into believing so many things that are patently untrue that healthcare reform is increasingly looking like the camel, a horse designed by a committee. Or, even worse, an elephant—a mouse built to military specification and completely unsuited to the intended task.
Part of my low spirits comes from reading this article at the Center on Budget and Policy Priorities. In the article their claim is that the greater proportion of spending in healthcare is for “high ticket items” rather than on the routine maintenance portion of healthcare. If that’s true it certainly would appear to dim the prospects for meeaningful cost reductions as a result of reducing excessive demand which is where a considerable portion of the energy is being devoted.
To my mind that would leave only two alternatives, neither particularly easy or even likely. Those would be increasing supply particularly via better use of technology (the equivalent of sending a fax rather than hiring a herald) or wage and price controls.
As I say, between the shenanigans going on in Washington, the histrionics in the blogosphere, and the material difficulties in solving the problem, I’m pretty depressed about the prospects for healthcare reform.
This study fits nicely with what I see and write about. Unless you set deductibles in the many thousands, I dont see them making much difference. Granted, I am an OR based specialist, but procedures and testing is where the big bucks are. On the micro level, can also see how HSAs may increase some spending. When our health insured wanted a 26% increase, we chose a different plan with a higher deductible and less benefits. So as to not lose employees, we also made some adjustments in our dental/vision plan to make it a medical slush fund. It was immediately used to capacity including some items I think barely qualify (our lawyer says its ok).
As I have noted before Dave, the literature suggests that docs are good at creating demand. In the short run, increasing supply will just as likely run up costs. It also takes a long time to train new people, so that solution will take a while. Then, would you go to med school if you knew that they were producing a lot of grads just so they could drive down your salary? Tech? Priced any robots lately? J/K. That may be a solution, but it is a long way off. Most medicine is more like car repair. You still need the local guy to do the job.
There are other options than price controls. One, make it legally permissible to engage in behind the times medicine, say at 2004 levels. A lot of our costs are driven by new tech. There is an awful lot of churning being done by manufacturers and pharma. Use 2004 (the year 2004 is arbitrary) total knee components or pacemakers. To do this you need legal coverage as you would not be practicing state of the art medicine.
Two, cost effectiveness research. You poo poo this, but a lot of docs I know would use this information. More importantly, if we have it, we can use it to clamp down on other docs. Three, transparency. Just listing costs for procedures and tests would make people aware of the costs, which they dont know at all now. Also, we could combine transparency and cost effectiveness research. Publish a list of hospitals which shows how they rate in cost effectiveness in which procedures they employ. Bound to play havoc with the back surgery industry.
Steve
The more I think about it, the more I like Arnold Kling’s plan to offer federal-level catastrophic coverage and vouchers to individuals to purchase insurance for the rest.
But that will happen when pigs fly. I’ve been depressed about this for quite a while and I’m almost to the point of apathy.
I could live with Kling’s plan, but it would not drop costs.
Steve
Personally, I thought the key feature of HSAs was that by assigning cost controls to the patients for the small stuff, the big stuff is left for either the government or insurance to examine. Effectively outlawing HSAs, makes more centralized control of the price at all levels more essential. (Part of the linked article accurately points to the incentives of the tax preference, but that’s true of many areas of healthcare)
ditto.
geez, if only women would be ready to spend the same amount of time looking for good prices for medicine/delivery as they do when shopping for …shoes…. and if only men would be prepared to KNOW that they are not the everyouthful things they think they are
Re; favorite movies
You might *really* like “Nowhere in Africa”–a German flick. It won best foreign pic a few years ago. When I first saw it, when I was living in Jena Deutschland, I thought to myself, ‘this will be a tragedy if this film does not go global’….a master film.
OT, but no posts on the Iraqi election today? Did you read the Exum interview with Amos. I think the refugee issue is a long slow burn with major long term consequences for us.
Steve
I’ve said pretty much what I’ve got to say about Iraq. I opposed the invasion. I also opposed withdrawing in 2005 or 2006 on humanitarian grounds. Our troops were a major force in preventing the situation in Iraq from disintegrating into all-out civil war.
I feel completely vindicated in my views on Iraq but I also think that we’re wasting time and money there now. Now that we’ve withdrawn from the cities most of our troops are serving little useful purpose and IMO it’s time for us to go.
Iraq’s election will turn out as it will turn out. I’m not as pessimistic as Pat Lang about Iraq’s prospects but I’m also not as optimistic as the Iraq boosters. I think that it will putter along with a deeply flawed democracy and lots of Iranian influence as long as the Kurds don’t declare independence in which case all bets are off.