Dems’ Health Care Plans Will Make Things Worse
There seems to be a real disconnect between the folks actually crunching the numbers and those spewing the rhetoric.
Asked by Senate Budget Committee Chairman Kent Conrad, D-N.D., if the evolving legislation would bend the cost curve, the budget director responded that — as things stand now — “the curve is being raised.”
Explained Elmendorf: “In the legislation that has been reported, we do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount. And on the contrary, the legislation significantly expands the federal responsibility for health care costs.”
Even if the legislation doesn’t add to the federal deficit over the next years, Elmendorf said costs over the long run would keep rising at an unsustainable pace.
Part of the reason is that Obama and most Democrats have refused to accept a tax on high-cost health insurance plans as part of the overhaul. There’s wide agreement among economists that such a tax would give businesses and individuals an incentive to become thriftier consumers of health care. Senate Finance Committee Chairman Max Baucus, D-Mont., said Thursday that Obama’s position isn’t helping matters.
White House officials played down the significance of the budget director’s assessment, calling it premature. “At the end of the day, we’ll have significant cost controls,” presidential adviser David Axelrod told The Associated Press.
To the Democrats, this is not about controlling cost…it never was. It’s all about government controlling the lives of every man, woman and child. Cost containment is a distant second.
Posted by .(JavaScript must be enabled to view this email address) on July 16, 2009 at 2304 hrs
We can listen to Sykes and Belling warn on this all day long. But ultimately we need a plan to help kill this thing. Something more significant than just sending an email to Kohl and Feingold that a liberal staffer will hit “delete” on.
What ideas Owen? Tea party outside Kohl’s office?
This House bill is pretty scary.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 0027 hrs
Kohl and Feingold won’t listen, but call anyway. And keep calling. And tell your friends to call. And call some more. Burn up their phone lines. This is the most dangerous legislation in my lifetime and maybe in history. Your fundamental liberties are at stake. Read this as well:
http://www.ibdeditorials.com/IBDArticles.aspx?id=332548165656854
Posted by Steve on July 17, 2009 at 0347 hrs
Steve, that IBD article is incorrect. If you were to keep reading to page 19 of the bill, you would see a bunch of language discussing the provision of individual health plans. Granted, individual plans would have to conform to a whole slew of new regulations (under which they may well crumble), but they’re still available.
The only way to effectively constrain cost is to either make individuals pay more of their own health care costs or to ration care based on some other formula that doesn’t involve end cost to the consumer. Our present fee-for-service system rewards doctors for performing unnecessary procedures, and our current insurance system discourages consumers from ever saying no to health care. No wonder we spend a lot on health care to obtain mediocre outcomes. Neither the doctor nor the patient has any incentive to behave responsibly.
I still believe that providing some level of basic care on a universal level is highly cost-effective, but I think the Democrats and I disagree on what exactly the word “basic” means. “Basic,” to me, means routine checkups, preventative care (including vision and dental services), and low-cost procedures with high QALY numbers - but nothing more. So thumbs up to helping patients manage their diabetes, and thumbs down to providing expensive treatments to people with terminal cancer. You want the expensive stuff, buy a catastrophic policy or find something more comprehensive from a private insurer.
Posted by Recess Supervisor on July 17, 2009 at 0445 hrs
RS,
To me that sounds like a sensible idea.Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 0817 hrs
Universal Insurance is cost effective to whom, RS? Given that neither you nor the federal government pay for my health care now, excepting employer tax incentives, neither of you will be paying less for my health care in the future through any universal coverage plan. Additionally, what I choose to spend on my health, and what risks I choose to insure, ought to be my business.
What this is, in the end, is yet another scheme by which politicians can buy votes and reward themselves and the existing interests. It’s purpose is to collect for the federal government insurance premiums from the relatively healthy, productive and inexpensive portions of society now, dole them out now, and then ration and deny treatment in the future to the people who paid the premiums.
The proper thing to do is to have a discussion now about the excessive levels of benefits being shelled out to the older generations now. That would begin to control costs for the federal government.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 0817 hrs
I’d probably attend some type of gathering that was anti-socialist health care…
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 0847 hrs
wingnutters at home a roostin! awesome.
p.s. forced abortions for EVERYONE!!!!!Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 0859 hrs
BV, our prevailing social ethos is that people end up receiving care regardless of their ability to pay. So when someone poor shows up in an emergency room for something very basic, they receive some kind of treatment. When someone just out of college could afford insurance but chooses not to buy it, and then gets in a horrible skiing accident, the hospital fixes them first and inquires about payment later.
The hospital either passes these costs along to paying customers in the form of higher costs or writes the expenses off as a loss - something we both know is unsustainable in the long-term. So long as this safety net exists (and face it, it always will), it is most certainly the business of the taxpayers what you and others choose to insure, because we are already on the hook for these costs.
You blow a hole in your own argument by trying to except tax subsidies for employer-based health insurance. That’s one of the largest ongoing subsidies in existence. To dismiss it is like saying “well, if we take entitlement programs off the books, the federal budget is lookin’ pretty good.” That subsidy blurs the actual end cost to the consumer and encourages insured parties to consume more care than they would otherwise. From a consumption standpoint, that subsidy is part of the problem. If it was gone, consumers would request less costly, less comprehensive plans.
It is more cost-effective for us as taxpayers to mandate the purchase of insurance by those who can afford it and provide financial assistance to help those who make too much for MA but not enough to comfortably afford private insurance. That would take care of universal coverage, leaving us only with the overall cost issue to deal with. It would certainly be better than the Democrats’ approach.
The alternative is our present system, which effectively provides catastrophic coverage for free to every idiot who thinks they don’t need insurance and treats the emergency room as the primary care ward for the poor. We pay for all of that ongoing risk right now, and the reality is that our collective social conscience isn’t about to let those people die because some of them made bad choices.
But to reference my earlier post, I think we’re both in agreement when it comes to government needing to be more selective about the treatments it is and is not willing to pay for. I think there are also a lot of other things we can do before doing what the Democrats are proposing - roll back existing benefit programs to more reasonable levels, require insurers to standardize their paperwork, mandate use of electronic records, eliminate the fee-for-service arrangement between insurers and providers that incentivizes the delivery of unnecessary care, etc.
Health care costs are skyrocketing because insured customers bear no real cost for demanding care, most doctors have every financial incentive to say yes, and because our collective sense of social fairness demand that everyone who lacks insurance gets treated anyway if their problems are severe enough. We can’t do much to change the latter, but the first two are definitely within our grasp. I just don’t think fixing it requires nearly the kind of greedy, power-grabbing overhaul the Democrats are proposing.
Posted by Recess Supervisor on July 17, 2009 at 1157 hrs
RS -
Tort reform/reduce the cost of malpractice insurance must be added to your list. As well as having states mandate the type of coverage and allowing consumers to select coverage ala carte to best meet their own needs. I don’t need birth control, OB, well-baby or autism coverage. Why should I (or my employer) be required to cover it?
Otherwise, we largely agree on what you say in #9
On the original post - Axelrod’s “significant cost controls” is Demospeak for “rationing”. I wonder if the AARP - whom Biden was cheerleading the plan to today - understands that their coverage will be the first to go? Sorry Gramps, your expected life-span on the actuarial table just doesn’t give the cost-benefit for that surgery on that broken hip - here’s your morphine and wheelchair….
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1715 hrs
neomom,
Making the selection of coverages a-la-carte, will increase overall costs. The pooling of risk is the whole rationale behind insurance. If you only charged the cost of care for autism, for instance, to those who have that condition, it increases their costs dramatically. It also increases the costs overall due to increased administrative costs in having to track who is in what category.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1729 hrs
elovrich -
In other words you are a statist and a redistributionist. You really don’t care about making health care cost less overall, you just want it to be the same for everyone.
The rationale of insurance is not pooling of risk, it is personal mitigation of risk - a “just in case” back-stop.
Homeowner’s and auto insurance are largely ala carte. I don’t see those insurance companies having issues managing policies. You know we have these really neat computer systems now, its not like some schlep is looking up stuff manually. That’s what coding is for.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1745 hrs
Wow, you don’t read many of my posts do you? Statist? Redistributionist? No, I am neither of those things. What I am is a pragmatist, and someone who once worked in the insurance industry. And the purpose of insurance, by definition, IS the pooling of risk. Mitigation of risk is an individual responsibility that leads to lower costs overall. But insurance is about accepting the cost of others in the event that you may need to utilize the same opportunity yourself. To have separate pools like you suggest leads to adverse selection.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1842 hrs
And yes, insurance is supposed to be the same, if not for everyone at least for large enough, and homogeneous enough, groups to allow the Law of Large Numbers to operate.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1844 hrs
The insurance model is based on the following foundational concepts:
* Any individual may experience significant costs if they get very sick or badly injured.
* In a large population, the number of people who will get very sick or badly injured during a given time period is relatively limited, compared with the number of people who will be healthy during that same time period.
* We can predict fairly reliably how many people in a large group will be (for example) struck by lightning. We cannot reliably predict which individual in that group will be the one who is struck by lightning in three months.
* By pooling together money to help cover the costs for people who get sick or injured, the group as a whole can pay for expensive health care treatments, while each individual within the group pays relatively little. This helps to protect each individual from having to pay sudden, largely unpredictable, and potentially very expensive health care bills.
* Because anybody can become sick or injured at any time, everybody benefits, because they know that if they get sick or injured, the group as a whole will pay for them, just the same as anybody else.
neomom, any disagreements with the concepts above from the standpoint of what insurance is supposed to accomplish?
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1907 hrs
Wow, you are a bit into the insurance thing aren’t you.
I am a bit jaded by the politics of insurance in my new home state. The insurance commissioner here sets home and auto rates by county through political back-scratching, not the actuarial tables. Therefore even though some counties in the another (his) part of the state had significantly more claims than the ones in my area, we got a 30% hike while they got a 6% cut. He’s a Dem, they are Dems, our district is largely Repub. Go figure.
I’m just saying that any time you politicize this stuff it will fail on an EPIC level.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 1959 hrs
So, you agree that a single pool, with the risk spread equitably across a large number of people, rather than a-la-carte selection, with rates set based on good mathematics, is a reasonable model?
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 2016 hrs
No,RS. Emergency room costs aren’t breaking the federal budget. Hospitals can and do go after people for unpaid costs to the maximum extent allowable by law. No federal insurance plan is going to collect more from them. In fact you are likely to collect less from them as hospitals can inflate the costs to the uninsured even if they never collect the full amount. The tax subsidy for employer provided insurance is not a massive loss to the federal government when balanced with Medicare/Medicares’ shifting of costs to the private sector.
People who can’t or don’t pay for insurance now aren’t going to contribute anything significant to any national health insurance plan. They are simply going to consume even more.
I would disagree with your model, elovrich. Such a model is applicable to catastrophic insurance, but not to health insurance in general when we in the United States expect insurance to cover routine health maintenance and other eventualities more likely to occur than not.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 2043 hrs
BV;
I agree that in recent history, beginning with the explosion of HMOs, the mindset of prepaid health-care rather than insurance in the traditional sense has expanded costs. But that being said, the model still holds, you can project the costs that will be incurred and spread those over the pool population. The theory being that maintenance lowers long term costs by avoiding the ‘ER as primary provider’ syndrome. Will it finally work if all have access to maintenance? That, IMO, will be the biggest possibility for cost savings overall, minus tort reform. The next question will be, are there enough providers?
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 2056 hrs
The evidence that maintenance will lower any costs is on thin to no ice. Tort reform isn’t going to lower costs either. Doctors are heavily insulated from malpractice claims, their whining not withstanding.
I think the way to go will be to deregulate a lot of primary care. Doctors are not needed for a lot of what passes as health care these days, and if we could Wal-Martize a lot of basic health services that might make a difference.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 2127 hrs
I’m tellin ya: A big ol’ McDonald’s menu of basic services will go a long way to reducing the cost. an informed consumer is a frugal consumer.
Posted by Steve on July 17, 2009 at 2131 hrs
Not saying that maintenance isn’t on thin ice, but to have any chance it requires elimination the ER visit for routine care. Tort reform wont lower costs by eliminating settlements, but rather from elimination of unnecessary tests to CYA. Yes, the use of nurse-staffed clinics for routine care is part of the solution and one you will see more and more.
Just imagine, rather than mom taking her child to the ER for a cough that has developed into something serious, but needs a series of tests to rule out something VERY serious and requiring the services of an MD, she brings her charge into a clinic to see a nurse and gets the cough taken care of before it has a chance to develop into something else. Think there isn’t substantial savings there? Not to mention that the ER then becomes more efficient, Drs are less stressed, making better decisions on true emergencies.
Posted by .(JavaScript must be enabled to view this email address) on July 17, 2009 at 2138 hrs
No elovrich, I don’t think there is substantial savings to be had in additional preventative care. We all like the idea, but there just isn’t the evidence for it leading to a cost savings.
The only way you will have less CYA is to make doctors even less accountable for their actions. I can’t favor that.
Posted by .(JavaScript must be enabled to view this email address) on July 18, 2009 at 0721 hrs
If the ERs could triage the non-emergency stuff to a clinic or urgent care without fear of being sued it would go a long way too. ie - Minority Mom brings child to ER at Children’s Hospital with a runny nose and cough - probably a cold with a sinus infection - if the ER staff could set Mom up with an appt the next day at the free clinic down the street instead of processing through the hospital everyone would come out ahead. But the ER staff processes the kid because they don’t want to be sued for discrimination and doesn’t want a bunch of ACORN/LaRaza astroturfers protesting outside shouting claims of the same because they “turn away” minorities.
Hence another reason for tort reform.
Posted by .(JavaScript must be enabled to view this email address) on July 18, 2009 at 0814 hrs
RS: “our current insurance system discourages consumers from ever saying no to health care.”
I must get 2 levels of approval (insurance co. & health care consulting firm) for most procedures, and “no” is always an option all involved have used. Maybe you talk of your plan?
RS: “Health care costs are skyrocketing because insured customers bear no real cost for demanding care”
With a chronic medical condition since birth, a high deductible and responsible for 30% of costs, those are very real costs to me. With 4 major surgeries over the years, I could put my kids thru college for what I’ve spent on my health. BTW, I’ve never demanded care. Again, maybe you talk of your plan?
Posted by .(JavaScript must be enabled to view this email address) on July 18, 2009 at 0936 hrs
@Sam: I think it’s safe to say that you are the exception and not the rule. Many individuals with employer-sponsored insurance have relatively low deductibles and minimal co-pays that aren’t sufficient to deter consumption. They’re also never going to come close to the lifetime caps on their policy, they don’t have ongoing co-insurance requirements, they don’t have chronic conditions from birth, etc.
@elorvich, BV, neomom: Good points, all. One other thing that we haven’t mentioned re. the cost/outcome analysis is that, compared to other countries, our inputs are generally less healthy. I have little doubt that our health care costs would shrink significantly if Americans simply were more active and took better care of themselves. Also, in my experience living abroad, it seems as though elderly residents elsewhere are less demanding of fancy care as well - that they are more willing to accept certain aches and pains and just being part of the aging process. We can’t hesitate to remember that WE are a big part of the problem, and no amount of reform or regulation can likely change that.
Posted by Recess Supervisor on July 18, 2009 at 1400 hrs
One comment stated, “The only way to effectively constrain cost is to either make individuals pay more of their own health care costs or to ration care based on some other formula that doesn’t involve end cost to the consumer”.
I don’t think that quite hits the mark. Consumer control over their health care expenses is utlimately the best way to achieve efficiency. We don’t have that now. There is nothing even approaching a free market for health services (such as we have for lasic eye surgery). The problem with a national health care plan is it is ultimately about rationing.
Insurance portability, inter-state competition for insurance plans, tort reform, less government mandates for coverage and market based consumer incentives are all promising reforms that could address many of our current health care problems without a government takeover. Unfortunately, the people in power today have no interest in even considering market based reforms that have a much higher chance for success than a government run program without the pitfalls of a government program.
Posted by .(JavaScript must be enabled to view this email address) on July 19, 2009 at 1938 hrs
Rationing is kind of a bogeyman in this debate. Health care is already rationed - it’s rationed by cost. There are people who make too much to qualify for MA but don’t make enough to pay for private insurance. Their care is rationed. There are those with expensive conditions whose insurance companies won’t pay for what their doctors recommend. Their care is rationed.
The question is whether, when public funds are involved, there should be some other rationing mechanism by which to decide who receives a resource that, at its essence, is limited.
Posted by Recess Supervisor on July 19, 2009 at 2001 hrs
Just my observations, but thinking back to when I was a kid we never went to the doctor. Now when my kids were little I’d take them for all kinds of things. So that is part of the problem…over use. Now that I am self insured I only go if it’s a must.
Perhaps if everyone had to make a co-pay just for walking in the door there would be less mis-use of the system. I know people at my place of employment that go to the emergency room for a hang nail so they can get out of work. These are folks on Bager Care or no care because they choose not to pay for it.
I am self insured and the costs are very high, but at least I still have choice. I can see the new government run health care creating lines and having a long wait time. Also, the quality of doctors entering the field will decrease and we will not have the high standard quality doctors we will need.
Posted by .(JavaScript must be enabled to view this email address) on July 20, 2009 at 0844 hrs
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