As practically everybody predicted (well, I did, anyway), the Massachusetts health care plan has run into problems:
BOSTON — Three years ago, Massachusetts enacted perhaps the boldest state health care experiment in American history, bringing near-universal coverage to the commonwealth with Paul Revere speed.
To make it happen, Democratic lawmakers and Gov. Mitt Romney, a Republican, made an expedient choice, deferring until another day any serious effort to control the state’s runaway health costs.
The day of reckoning has arrived. Threatened first by rapid early enrollment in its new subsidized insurance program and now by a withering economy, the state’s pioneering overhaul has entered a second, more challenging phase.
Thanks to new taxes and fees imposed last year, the health plan’s jittery finances have stabilized for the moment. But government and industry officials agree that the plan will not be sustainable over the next 5 to 10 years if they do not take significant steps to arrest the growth of health spending.
Later on the article puts the concern of many about such plans, that universal coverage is merely a stalking horse for price controls, into high relief:
Those who led the 2006 effort said it would not have been feasible to enact universal coverage if the legislation had required heavy cost controls. The very stakeholders who were coaxed into the tent — doctors, hospitals, insurers and consumer groups — would probably have been driven into opposition by efforts to reduce their revenues and constrain their medical practices, they said.
I’m open to arguments that for some reason a national program along the same lines would fare better. I have no reason to believe that it would.
Whether the plan will continue to receive the political support that it needs to continue to exist in the face of costs rising far faster not only than revenues but than revenue streams, remains to be seen. IMO the moral of this story is that if you sincerely want to extend healthcare coverage to more people we need to cut costs first. Any other alternative will have perverse secondary effects, most especially increasing costs by reducing supply.
I like the idea of state experimentation, but are such experiments doomed to failure? Wouldn’t people be moving in and out of Massachusetts in a way that puts stress on the program?
How do you even prioritize treatment in the MA system?
I’m curious about this because, at least in an actual single-payer system, you could do things like setting the price for covered treatments, then let the doctors sort out when and where treatment would occur for people. At least in theory, it would prioritize the most critical problems first.
But the MA system, if I recall correctly, requires everyone to get coverage, then offers subsidies for coverage for the poor rather than offering a state plan.
Aside from that, I ought to point out two things. First, there were a lot of people without insurance who came on-board (more than expected), so it isn’t really surprising that spending has gone up. Second, is this from overall spending, or government spending? Government spending is more visible, but it could be just replacing private spending in certain places.
There’s that. What they really need, though, as the article points out, is freedom to incorporate the Medicare and Medicare spending into the overall program, or to create a singular state plan to go into the system. They can’t do that right now, and it needs reform on the national level.