Reading through Ezra Klein's morning discussion on health-care raises what to me is the fundamental problem with the left-wing health-care argument. (See, I'm fair to Klein. He might know less than nothing about food, but health care he seems to understand something about, and I do not).
So Klein says that the goal is to reduce national health care expenditures - what I understand as the aggregate spending on health care in the entire country, public and private. And the way to do this, I understand him to believe, is to use so-called "public option" to reduce costs. Fine.
As others have observed, I assume that Klein does not think it is a good idea to organize other parts of our economy in this way. After all, you can make exactly the same arguments about car production, and yet no one would say that we should reduce our national expenditure on cars by having government produce standardized cars with lower, negotiated prices. I recognize that smart people have constructed arguments about why the health care market is different, but I confess I do not completely understand them. But the left argument is dependent on the truth of this proposition.
Even granting the proposition, the bottom line really is that I do not believe there is an appreciable surplus of real waste in private sector healthcare as opposed to the public sector. I suspect, though cannot prove, that the reason national health care expenditures are lower in other countries are a combination of much lower compensation for health care professionals, lower drug costs, much less extraordinary care, and lower creature comforts in hospitals. I would assume an honest liberal would say all those things are true and are the proper cost for ensuring health care for all. Beware anyone who does not grant the truth of those propositions.
I think the left has to face up to the fact that getting universality of coverage and lower aggregate costs means persuading people who already have insurance to accept worse service or higher costs for their current level of service. I don't think they have done this forthrightly.
7/21/2009
Subscribe to:
Post Comments (Atom)
3 comments:
My dad's a doctor in private practice; my older sister is the head non-MD administrator for the cardiology department of a large teaching hospital; my younger sister has her undergrad degree in public health and is in her last year of medical school; and I majored in bioethics and used to work for one of America's largest health insurance companies, in their Medicare/Medicaid/CHIP section ... so the fam has been thrashing these questions out for a while.
First, Klein's post doesn't refer to the public option as the term has been used in Congressional Democrats' proposals. The "public option" essentially puts a government insurance plan in competition with private sector plans. Under these proposals, I can choose to buy the government's insurance with my private-sector-earned dollars; and a person who needs government subsidies to buy insurance can take those public-sector dollars to a private insurance company like UnitedHealth.
Instead, Klein refers to a "single-payer system," which the government is the "single payer" for everyone's health care (although individuals may "top up" to receive premium care by buying additional private health insurance). This is roughly what we have for senior citizens already through Medicare. My dad is in a mostly geriatric specialty, and while he's a pretty hard core economic conservative, he admits that it would be easier if all his patients' charges were to Medicare, even though Medicare provides lower reimbursements, because at least Medicare pays consistently and on time. Unlike private insurers, it does not have a policy of initially refusing as many charges as possible in hopes that either the patient will pay or the doctor will write it off as a loss. My dad employs several people for the sole purpose of billing: filing requests for payment (insurers all have different forms and procedures for this), receiving denials, following up with the insurer, following up with the patient, etc.
So that is a potential saving in a single-payer system: minimal billing BS. Another is the cost of paying people to do the job I did, which was to find new markets into which the company should expand. All the costs of marketing are wiped out with single-payer.
As for why health care is treated differently than cars, I imagine it has to do with the fact that on the one hand, cars are never literally necessary to life or health; and on the other hand, people don't need drastically different levels of car depending on their age, genetics, (mis)fortune, etc. I don't need a Mercedes when I am 80 any more than when I am 20, but I do need more and better health services when I am 80 than when I am 20. The need for a car also is fairly predictable: I live in NYC convenient to public transport, therefore I don't need a car. It's unlikely that that will change abruptly. OTOH, while I currently am in good health, I could walk outside, slip on the sidewalk, and need $10k in scans, surgeries, therapy and medication. The need is somewhat unpredictable, just as with other things we insure against (fire, theft, etc.), so we pool risks together instead of each individual bearing the load alone.
I suspect, though cannot prove, that the reason national health care expenditures are lower in other countries are a combination of much lower compensation for health care professionals, lower drug costs, much less extraordinary care, and lower creature comforts in hospitals.
You are correct on all of these except possibly the compensation for professionals. My little sister told me that the average compensation for physicians in (I believe it was) the UK is roughly the same, PPP-adjusted, as it is in the U.S. Since it's my obligation to poke as many holes as possible into anything she says, I asked her if the median compensation also was comparable (maybe a few outliers in the UK?), but this is a weak demurral when the n is so large.
I think you might find this informative on the subject:
http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande
Sarah,
How does single-payer by itself remove the problems Gawande describes? His statistics showing McAllen to be a hellhole of profit-driven doctoring are based on Medicare reimbursements. As I noted, Medicare already is the "single-payer" for senior citizens.
Gawande explicitly says, "When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care. Otherwise, you get a system that has no brakes. You get McAllen."
Gawande's article demonstrates that you can get better care at a lower cost when physicians aren't driven almost entirely by the profit motive, but Mayo Clinics aren't government entities; they're private-sector non-profits. You have to get rid of the Medical Economics (business mag for doctors) mindset. Mayo Clinics do it by gathering voluntary, like-minded professionals. You can't get a national change in health care that way. You have to do it top-down and by mandate, and I don't know if that's a model that can be mandated.
At best, the government can limit what it's willing to pay for, and even that will require taking the specific decisions out of Congress's hands (like we did years ago with military base-closing) and giving it to technocrats to run cost-benefit analyses and then stick to them, no matter how piteously Great-grandfather Joe asks for the $50k treatment that might give him three more months of life. That's going to raise more howls from a larger swath of the population than the base closings ever did.
Post a Comment