At National Journal Josh Krashaur does a pretty fair job of laying out the road ahead for the PPACA, particularly from a political standpoint. The short version is that a) Healthcare.gov better be usable pretty darned quick and b) that had better be the extent of the administrative problems with the healthcare exchanges or we will have nothing more than ongoing political damage control from here on through 2016. We may have that anyway.
The rest of this post will be sort of rambling. I haven’t really thought it out completely. It should be obvious to anyone who’s paying attention that healthcare costs are increasing out of control. Even with the decline in their rate of increase they’ve just slowed down to increasing more than twice as fast as incomes and revenues rather than three times as fast or more. Today we’re issuing bonds to pay for healthcare expenses. There are lots of good reasons to issue bonds but paying operating expenses isn’t one of them.
So, how can healthcare costs be brought under control? I think there’s general agreement that there will need to be some sort of change in allocation of scarce healthcare resources. If you don’t like the idea of that, you’ll probably call it “rationing”. If you do like it, you’ll probably think of it as “letting market forces work”.
As I’ve written before, there are basically two different ways of allocating resources: by fiat or via a market system. The starkest example of a fiat system is Soviet Russia. Commissars decide how much of each good will be produced and at what price it will be sold (if any). Sometimes they get it right. Very little of the good remains on the shelf and nobody who wants the good is forced to do without. More often they produce far too much or too little; the fiat prices are too high or too low; people go without.
Market systems have been commonplace for thousands of years. You can see them in operation at any farmers’ market. When the vendor selling at the market are actual farmers rather than middlemen, that is.
Most real systems for allocating resources combine the two systems. Our healthcare system is such a hybrid.
All of the plans that have been discussed for reforming our healthcare system are such hybrids. The largest difference among them is not so much whether they think that influencing how consumers make their purchasing choices is the way to control costs as to who they think the consumers/buyers of healthcare services are.
The plans produced by Republicans have tended to think of patients as the consumers who must learn to economize. For the PPACA it’s some combination of insurance companies, consumers, providers, and government.
My view is that the primary consumers of healthcare are providers and no system that does not start with incentives for providers to economize has a chance of reducing costs.
Has anyone seen an analysis of total value (not just price) of helth care to income for, say the last 50 years?
Something I saw recently reminded me of this important consideration. Paraphrasing, the point was: when Eisenhower had his heart attack they sent him home for bed rest with an oxygen bottle, today he might get a bypass or stents, statins, blood pressure medications, dietary and exercise counseling etc. The implications for a narrow measure of price to income will be vastly different in the two cases. But which is better?
As my primary quipped to me once “it used to be when a guy had a heart attack at 50 people said ‘well, yeah, he was 50,’ now they say ‘what happened?’
It depends on whether all of the additional activity increases lifespan or quality of life. For many interventions that’s hotly disputed. Right now there’s a heated debate going on about the use of statins in patients who don’t have heart disease.
Something else that’s controversial but shouldn’t be: standard PSA testing. The science doesn’t support its utility but for many physicians it’s standard of care.
“It depends on whether all of the additional activity increases lifespan or quality of life.”
Of course, but I suspect its pretty iron clad for many diseases and, yes, controversial for others. I just don’t know the net, net. I know my primary is convinced through clinical experience of the efficacy of statins for most. I’m surprised on PSA. Prostate cancer is obviously slow growing, especially the later you get it. But for men who contract in their 50’s I understand its an important early marker.
I’d love to hear steves view as he certainly would know better than I.
I’m 72, soon to be 73. I see my doctor in December. I intend to tell him to forget PSA testing. I’m on testosterone patch, and that kicks PSA up. Last year, I was on a stronger patch, and the PSA got up there fairly high fairly fast (it’s not really the absolute level of your PSA, but the velocity of change that is said to be troubling). So, he sends me to a urologist for testing. Six weeks of sweating it out. Negative on the test. Mucho positive on the anxiety. No more. It’s not worth it to me. Hell, at soon-to-be 73, something’s gonna get me, no?
This is a report that states that the quality of healthcare varies between private insurance and Medicare, after taking into account risk factors:
“We found that privately insured patients had lower risk-adjusted mortality rates than did Medicare enrollees for twelve out of fifteen quality measures examined. To a lesser extent, privately insured patients also had lower risk-adjusted mortality rates than those in other payer groups. ”
http://marginalrevolution.com/marginalrevolution/2013/10/the-quality-of-care-delivered-to-patients-within-the-same-hospital-varies-by-insurance-type.html
I don’t think I found access to the report, but I assume that the risk factors include age.
@sam, past experience indicates that you haven’t died yet, so I don’t know on what basis you could make your claim.
Heh. When you reach a certain age, yet doesn’t mean what you think it means.
The plans produced by Republicans have tended to think of patients as the consumers who must learn to economize. For the PPACA it’s some combination of insurance companies, consumers, providers, and government.
My view is that the primary consumers of healthcare are providers and no system that does not start with incentives for providers to economize has a chance of reducing costs.
I think that both patients and providers are consumers of a common interest — each needs each other to complete the equation of HC delivery. Patients should not be treated as unintelligent beings, in being unable to sort through plans and decide for themselves what is best for them. However, providers, who are seeking the business of patients in order to stay in business, should be consumed by efforts to provide the best quality product at the most reasonable price available. If both work in concert with each other, there is a better chance of not only better, more individualized HC availability, but also one that is priced at rates which both provider and patient can live with.
Talk of patients becoming better shoppers is absurd on its face. A rich man will spend all he has to stay alive, or keep his kids alive, so will a poor man. No one is going to scrimp. So when we talk about educated consumers exerting downward pressure on costs we really mean working folks, not the rich who of course spend freely.
A society then in which the people least likely to be well-educated sit around parsing the latest medical journals and compare costs vs. probable outcomes for their dying mothers and sick children. Right, that will totally happen.
And all to what end? To attempt to get doctors/hospitals/pharma to stop selling unnecessary procedures/tests/drugs to patients. That’s it, right? Because we’re not talking about treating bullet wounds or strokes, here. No one’s dumb enough to think people are checking the cost sheet at the ER, right?
So, we’re just going to get Wal-Mart clerks and McDonald’s employees with high school diplomas and the money they found in the couch cushions to push back effectively against rich, educated, powerful Big Medicine. In between holding down two jobs and allocating the food stamps the poor will read medical journals and do careful cost-benefit analysis on treating their daughter’s asthma and their aging mother’s cancer. Yes, that makes perfect sense.
And again, why? Because we need poor people to get doctors and hospitals and big pharma to stop raping us for profit? And that’s the sensible way to go about it?
Why not just take the profit out of medicine? Cuba – with ten cents in its pocket and an eternal embargo – has the same life expectancy as the United States. I don’t think their doctors earn more than a sack of beans and a piece of sugar cane.
Isn’t it possible that profit motive just doesn’t work in some situations? Does our embrace of unabashed greed get us better results? Clearly not.
How about this: You want a license to practice medicine in the US? You have to work at a fixed salary for the first ten years. You want to build a hospital? Fine, it’s non-profit. And you want to patent a new boner pill? No, problem, but you charge some fixed percentage over and above your costs.
You really look down on people don’t you, Michael. In fact, it’s your kind of subservient mentally towards others, that keeps people under the thumb of elites, the man, and anyone else who thinks they are better — better educated, richer, more powerful or just blessed with a higher IQ. IMO, people are a lot smarter than you give them credit for, and can think for themselves, if you give them half a chance — no matter what their economical circumstances, how many kids they have, or what medical conditions they may suffer with. I’ve certainly seen more wisdom executed, by a street person, or a person with a terminal illness than a guy with a swell car, a booming portfolio, and a bleeding liberal attitude.
Working in public health this became so apparent to me how the adminstrators always wanted to give people subsidies because they looked down on them, rather than give them options which would lead them out of their welfare conditions. You’re no different….
jan: IMO, people are a lot smarter than you give them credit for, and can think for themselves, if you give them half a chance
People can certainly think for themselves, but expecting everyone to have knowledge of the latest medical advances along with whatever other special skills they have is not realistic.
jan: I’ve certainly seen more wisdom executed, by a street person, or a person with a terminal illness than a guy with a swell car, a booming portfolio, and a bleeding liberal attitude.
Sure, which is why everyone nowadays gets their medical treatment from street people.
Any notion of insurers inducing economies is equally foolish and the means towards that end adopted by the PPACA wouldn’t accomplish the goal anyway. 15% of $600 billion is more than 15% of $500 billion. The more is spent on healthcare, the more insurers earn.
The Average Joe can’t keep up with the latest technology needed to design, manufacture, market and distribute iphones and ipads. Clearly the government should pass a law forcing people to buy Apple products the way the government says they should be designed, manufactured and distributed. Sorry Droid users.
Now, about the government’s view on automobiles, and how it will affect you……….
I must say, though, at least if the government is running things we can expect honesty, as we have witnessed the last four weeks (snicker) or this:
http://www.zerohedge.com/news/2013-11-18/october-2012-pre-election-jobs-report-was-faked
But worry not, the Commerce Dept will investigate the BLS…..
People can certainly think for themselves, but expecting everyone to have knowledge of the latest medical advances along with whatever other special skills they have is not realistic.
Did I say anything about “medical advances” dealing with decision making? If the ability to make a decision for yourself was contingent upon being a rocket scientist in every category of life, we would all be in the corner, sucking our thumb, waiting for someone else to kick a neuron into gear! Also, street people are sometimes diamonds in the rough — “Siddarthas” of our time.
Sure, which is why everyone nowadays gets their medical treatment from street people.
Your wry sense of humor is noted, however doesn’t really apply to my application.
Drew,
I read a similar article about the UE numbers being tweaked. I know at the time, it seemed more than simply a ‘lucky’ break for Obama to have such a long term UE number suddenly drop into the 7’s, right before the election.
Did you also see that polling article, how a year later Romney would hold an edge over Obama? I think that offers a counter argument to Michael’s confident comment, a short while ago, how Obama would still beat Romney.
No, Jan, it’s experience. Unlike you, I’ve been poor. You know how a poor person chooses a doctor? Like this: Is it on the bus route between job #1 and job #2? Or, is it near where I drop the kids off at day care? Or, will they be open during the one hour a week that I have available? Will they extend credit?
At the other end of the spectrum, I’m dealing with prostate issues right now. Between my wife and me we have a whole lot of smarts and a whole lot of money and computers and a personal physician and guess what? Still having a very hard time making sense of the odds and probabilities, of the logical moves, etc…
You don’t know poor, and you don’t know rich, and you don’t know a single damn thing that hasn’t been spoon-fed to you by Fox News.
@michael reynolds
Many people do not have an extra $4k, $8k, or $12k laying around, and a high deductible is the same as no insurance. These people will need to make the very decisions that you deem them too stupid to make. Interestingly, the “professionals” cannot stop themselves from over prescribing antibiotics.
When self-service gas stations started, there was a big debate about the average person being able to fill the tank without blowing up the place. Tire pressure, oil level, windshield dirt would not be checked, and this was going to cause all sorts of problems.
People with no or “substandard” insurance will get no more health care with their shiny, new Obamacare insurance. Of course, universal health care was never the issue, but I am sure that these folks will be overjoyed that their betters are getting lower premiums. “With friends like you, …”
Somehow civilization has been able to advance without the input of “the smartest people in the whole, wide world”, but if you have shit for brains, the obvious ain’t so obvious.
…and, Michael, you don’t know a thing about me, my history, my background. However, you do customize assumptions fitting nicely into a prefabricated script, which then serve to validate your own opinions and ideology.
Regarding your own HC issues — they are difficult for anyone to fathom and process. But the key word here is ‘choice.’ Another one is ‘options.’ And, ‘most,’ not all, people rich or poor in this country, like having both of these in play, when searching for answers.
When self-service gas stations started, there was a big debate about the average person being able to fill the tank without blowing up the place.
Tasty,
…and, while most people are able to fill up their tanks, by themselves, there are still attendants available for some who can’t — mainly the elderly or disabled. Such a scene played out yesterday when I was in a gas station. That’s one of the qualities of this country — their tendancy to take into consideration those not comprising “the vast majority” (using the Obama Administration’s term for success), and adapting to their needs.
Michael’s a bit testy these days. His hero is being shown the buffoon I’ve suggested all along. Everyone sees it…………but Michael. So……….”you don’t know poor.” Look at the bright side, he hasn’t resorted to the usual “you are a racist.”
In other news. What have I been saying for at least two years?
http://www.zerohedge.com/contributed/2013-11-19/proof-positive-inputs-99-economic-modeling-are-garbage
I hate it when I’m right.
PS –
Michael will deny, deny, deny. But I watch pieces of MSNBC probably three times a week just to see what the other side is saying. I conveniently miss Ed Schultz because he’s just batshit crazy. And Mr. Bashir’s poopie S&M sexual musings are not, uh, helpful. But I do watch Princess Maddow. Michael’s defenses and MSNBC are indistinguishable.
At least Fox has its resident denier – Juan Williams.
I hate it when I’m right.
Fess up, Drew…No you don’t. However, you can base your accuracy on being ‘experienced’ in the field of business However, that still won’t guarantee you that Michael won’t come back positing that you’re not.
Drew,
I watch other news stations, and ultimately find a far more interesting/intelligent balance, as well as extraneous details, given on Fox. They regularly present comments/debates in their broadcast, reflecting both conservative and liberal POVs, mostly in tandem with each other, giving a viewer a much broader perspective of issues. They essentially do what investigative, curious, journalists are supposed to do — a more adiaphorous examination of an administration’s policies and governance, rather than just pandering to a WH’s talking points because of their ideological kinship.