The graph above illustrates the increase in real U. S. per capita healthcare spending. Lest we lose track of it, the PPACA had multiple objectives. One of the objectives was to increase the number of Americans who had healthcare insurance. It’s been mildly successful at that. Other objectives includes “bending the cost curve down” and reducing the deficit.
In accomplishing those it has been a flop. To quote Medicare trustee Charles Blahous:
Given how the ACA’s advocates touted the law as “bending the health care cost curve [down], and reducing the deficit†while occasionally in the same sentence crediting it with expanding coverage to “more than 94 percent of Americans,†many Americans could be forgiven for not understanding those two goals were in conflict.
Supporters of the PPACA will retort that our excessive healthcare spending is due to the increase percentage of old people in our population. Consider:
Do you see that dot that’s the far outlier indicating much higher per capita spending but lower life expectancy? That’s the United States. It’s the prices, stupid, as Uwe Reinhardt put it. We’re not receiving value for our money.
Back in the halcyon days of 2009 when the PPACA was a hot topic, I maintained a consistent position:
- Insuring more people was a fine objective but increasing the number of people insured would not of itself reduce spending.
- Reducing the cost of healthcare would of itself increase the number of people insured by the processes of supply and demand.
- Unless healthcare spending were curtailed, it would crowd out other spending priorities.
- Consequently, the more pressing problem was reducing healthcare costs.
and that’s still the case. As I also pointed out to those who claimed that the PPACA was merely the start, the first step in a a series of grand reforms in how healthcare would be delivered and paid for, the history of healthcare reform in the United States pointed in the other direction. The debates are always so bitter politicians have little appetite for tackling the problem for years after a major healthcare reform debate.
The problems haven’t gone away. Healthcare reform is overdue.
Reform, in your case meaning the cost part, has been overdue for 30 years. As I said before no country has tackled costs w/o first having universal, or nearly, coverage. Assuming the GOP wins in either 2016 or 2020 will be a good test. Will they finally produce a real plan, not just the one or two page list of aspirational goals? Will they repeat Obamacare or just modify it, going after the cost issue.
Also, I realize this is the US and we all have functional ADD (we want it now) but people are really just starting to work on cutting costs, at least on the hospital side of spending. In the past there was always the drive to just do more, to increase revenue. With Medicare leading the wagon bundling and wanting value rather than just lots of care, I expect efforts to expand.
Steve
I’ll say again what I’ve said from the start: health care/insurance is now in the federal government’s in-basket. People are already used to no pre-existing conditions, extending coverage to adult children, etc… That was the necessary first step. Nothing else was going to happen, ever, until we admitted as a country that this is a national problem that must inevitably be dealt with by the federal government.
It’s a drag that it has taken this much effort to get to first base, but again, we have these creatures called Republicans. (They used to be a political party.) Faced with a distinctly Republican plan coming from a liberal black POTUS, they naturally objected – and registered their objection by nominating the very guy who signed off on this conservative plan in Massachusetts. (It’s eerily like their effort to block judge Garland – a judge they actually like, but who was nominated by a liberal black POTUS.)
Nevertheless, now that it is a federal issue, we will inevitably deal with it at that level. I agree – hell, everybody agrees – that we need universal coverage and that we need to cut costs. But we can’t do anything until the new White People’s Party sees the back of the black POTUS. The health care issue needs to do what the drug abuse issue has finally done – cease to be seen as being all about minorities (lock ’em up, the scum!) and be more about white people (awww, poor babies need treatment.) Then we’ll start coming to grips with it.
I think the assumptions of the PPACA have mostly failed. Just to cite one example it was assumed that the PPACA would be overwhelmingly popular. It hasn’t been. It’s been popular with those receiving subsidies but not so much with everybody else.
Anybody who knows anything about marketing knows that getting that last 10% is harder than getting the previous 90%. It’s not just the United States. That’s been the experience in every country. The way the federal funding was strategized clearly made the opposite assumption.
I understand why it was structured the way it was—it would have been DOA otherwise. That just highlights the problem.
And I’ll say what I’ve said from the start. Everybody likes chocolate; nobody likes broccoli. That’s why dessert is last rather than first. Saving the hard part for last does not make the job easier. What will actually happen is that the Congress will just let the costs increase while the healthcare system saps investment, talent, and energy away from the rest of the economy. You know, the part that employs people.
Off-topic, Michael I heard something in a TED talk yesterday that I thought would tickle your fancy. We have a scientific explanation for why we should eat more. The great density of the neurons in our mighty cerebral cortexes requires much more energy than those of other people.
It justifies our seeking out high caloric-density foods—things like chocolate and bourbon. We need them to maintain proper mental functioning.
Well, Dave, a wise man once told me that that which cannot go on, will not go on. (I think you put it more eloquently.) So if costs cannot continue to rise, they will not continue to rise. Sooner or later the federal government will either deal with the cost issue or watch the entire federal government be consumed by it. I grant that a man who has been watching Chicago politics closely might be excused for assuming the latter course, but I think (hope) that eventually (absurdly late) the USG will cope.
BTW, it will be interesting to see whether these new death with dignity laws will have any effect on spending. I find them a great comfort – I don’t mind dying, but I’d rather not make it a death by protracted medical torture. I don’t think many people are taking advantage of the laws yet, but it takes a while for people to get used to the idea. I have no numbers but I have to imagine that popping some pills and going nightie night for the last time is a whole lot cheaper than several months in hospice or the hospital. And that is where the money goes – dragging out the inevitable.
Dave:
I’m sorry, I missed that last OT post – busy stuffing my face with delicious breakfast foods.
“I think the assumptions of the PPACA have mostly failed. Just to cite one example it was assumed that the PPACA would be overwhelmingly popular. ”
I followed all of those CBO projections. Overwhelmingly popular seems a bit much. However, the CBO also had no way knowing that the red states were so oppositional that they would oppose even setting up markets in they own states. The very people who claim to love markets. Who would have guessed? Anyway, given the level of opposition and the constant challenges at SCOTUS, I think it has done pretty well. What I think we are really finding out is that there are limits with what you can do using markets and competition to spread health care.
Let’s remember that the conservative big idea is that we need to make sure people have skin in the game (hate that phrase). They wanted catastrophic insurance or something similar. Something which would result in large deductibles. Well, that is what the insurers have delivered in order to keep costs down. What we are finding, not surprising to those of us who follow the issue, is that when you make deductibles large enough, and for most people they don’t have to be that large, it is not much different than having no insurance. So you had the conservative politicians, nearly all wealthy folks mind you, pushing for deductibles of at least 5k-10k. Why not? everyone can afford that. Maybe buy a smaller car elevator. Turns out that 10k for a lot of people means you might as well not be insured at all.
Steve
Illinois is a red state?
Re: euthanasia and costs, note that Valeant now has the rights to the most prescribed med (Seconal) and jacked up prices according to KQED.
We are at the point where somebody has to lose campaign money (and other perks), risk electoral defeat and thus show courage in get a handle on this. I will not hold my breath waiting for such a person to appear.
Well, we do have to keep our brainpower up. It’s taxing but it’s for the common good.
“Well, Dave, a wise man once told me that that which cannot go on, will not go on. (I think you put it more eloquently.) So if costs cannot continue to rise, they will not continue to rise. Sooner or later the federal government will either deal with the cost issue or watch the entire federal government be consumed by it.”
Or, said another way, fires can’t burn forever.
It’s interesting how the rhetoric of PPACA supporters changed over the last four years. There are, today, few admissions of any structural problems or bad assumptions with the law – instead it’s about how bad Republicans are.
Andy-I just a wrote a paragraph about how the assumption that markets and large deductibles would decrease costs, which is a core principle for Obamacare.
Steve
Well there you have it. Health care costs are rising and the PPACA a mess because of racism and red states. You can’t make this shit up.
When you see a graph like the one presented you can only conclude that expenditures are being made that do not further the goal of,life expectancy. It can be unit prices/costs or misdirected expenditures, or both.
Call me crazy, but I think focusing on that and not racism might be more productive.
Guarneri:
You do realize that your obsessive denial of the existence of white racism only serves to convince people that you’re either an imbecile or a racist, right?
Michael,
I think it’s difficult to have any kind of debate when one side insists that opposition is because of racism. It tends to poison the well. It’s why I don’t post or self-censor on many other sites because racism and white privilege are among the first weapons brought out of the rhetorical armory.
It’s difficult to sensibly assess a reform policy when party politics and racial epithets are the foundation for debate. With these always at the forefront, discussions become nothing more than defensive/offensive plays. Statistics can be distorted to one or the other’s benefit. Old political myths can be revived and relished. Banished, though, is any ownership from anyone, either on the left or right, of contributory negligence. It is further adulterated by the liberal side generously and vigorously slandering their opposition, not in simply being “wrong-headed,” but also “evil, heartless, racists, terrorists” — anything and everything with a negative “ist” at the end of it is thrown self-righteously at ideological opponents of the liberal left. And, through this sandstorm of hyperbolic vitriol and condemnation, what kind of bi-partisan resolution do they ever expect to achieve?
Andy:
Yes, it is difficult FOR WHITE PEOPLE to discuss racism. Black people have no choice.
Any discussion of any issue demands honesty. Racism exists, it persists, it is central to the American experience, it is absolutely central to this election, and insisting that we pretend it isn’t real is no way to discuss anything.