Opinion

Opinion

3-step approach to health care reform

November 27, 2009

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— The United States has the best health care in the world — but because of its inefficiencies, also the most expensive. The fundamental problem with the 2,074-page Senate health-care bill (as with its 2,014-page House counterpart) is that it wildly compounds the complexity by adding hundreds of new provisions, regulations, mandates, committees and other arbitrary bureaucratic inventions.

Worse, they are packed into a monstrous package without any regard to each other. The only thing linking these changes — such as the 118 new boards, commissions and programs — is political expediency. Each must be able to garner just enough votes to pass. There is not even a pretense of a unifying vision or conceptual harmony.

The result is an overregulated, overbureaucratized system of surpassing arbitrariness and inefficiency. Throw a dart at the Senate tome:

l You’ll find mandates with financial penalties — the amounts picked out of a hat.

l You’ll find insurance companies (who live and die by their actuarial skills) told exactly what weight to give risk factors, such as age. Currently insurance premiums for 20-somethings are about one-sixth the premiums for 60-somethings. The House bill dictates the young shall now pay at minimum one-half; the Senate bill, one-third — numbers picked out of a hat.

l You’ll find sliding scales for health-insurance subsidies — percentages picked out of a hat — that will radically raise marginal income tax rates for middle-class recipients, among other crazy, unintended consequences.

The bill is irredeemable. It should not only be defeated. It should be immolated, its ashes scattered over the Senate swimming pool.

Then do health care the right way — one reform at a time, each simple and simplifying, aimed at reducing complexity, arbitrariness and inefficiency.

First, tort reform. This is money — the low-end estimate is about half a trillion per decade — wasted in two ways. Part is simply hemorrhaged into the legal system to benefit a few jackpot lawsuit winners and an army of extravagantly rich malpractice lawyers such as John Edwards.

The rest is wasted within the medical system in the millions of unnecessary tests, procedures and referrals undertaken solely to fend off lawsuits — resources wasted on patients who don’t need them and that could be redirected to the uninsured who really do.

In the 4,000-plus pages of the two bills, there is no tort reform. Indeed, the House bill actually penalizes states that dare “limit attorneys’ fees or impose caps on damages.” Why? Because, as Howard Dean has openly admitted, Democrats don’t want “to take on the trial lawyers.” What he didn’t say — he didn’t need to — is that they give millions to the Democrats for precisely this kind of protection.

Second, even more simple and simplifying, abolish the prohibition against buying health insurance across state lines.

Some states have very few health insurers. Rates are high. So why not allow interstate competition? After all, you can buy oranges across state lines. If you couldn’t, oranges would be extremely expensive in Wisconsin, especially in winter.

And the answer to the resulting high Wisconsin orange prices wouldn’t be the establishment of a public option — a federally run orange-growing company in Wisconsin — to introduce “competition.” It would be to allow Wisconsin residents to buy Florida oranges.

But neither bill lifts the prohibition on interstate competition for health insurance. Because this would obviate the need — the excuse — for the public option, which the left wing of the Democratic Party sees (correctly) as the royal road to fully socialized medicine.

Third, tax employer-provided health insurance. This is an accrued inefficiency of 65 years, an accident of World War II wage controls. It creates a $250 billion annual loss of federal revenues — the largest tax break for individuals in the entire federal budget.

This reform is the most difficult to enact, for two reasons. The unions oppose it. And the Obama campaign savaged the idea when John McCain proposed it during last year’s election.

Insuring the uninsured is a moral imperative. The problem is that the Democrats have chosen the worst possible method — a $1 trillion new entitlement of stupefying arbitrariness and inefficiency.

The better choice is targeted measures that attack the inefficiencies of the current system one by one — tort reform, interstate purchasing and taxing employee benefits. It would take 20 pages to write such a bill, not 2,000 — and provide the funds to cover the uninsured without wrecking both U.S. health care and the U.S. Treasury.

Charles Krauthammer is a columnist for Washington Post Writers Group

Comments

just_another_bozo_on_this_bus 5 years, 7 months ago

Wow, Charles, your criticism of much of the proposed legislation is well-deserved, but your proposals would fix absolutely nothing-- it would likely even make things worse.

The only way to fix this mess is to completely scrap the current system, and either go to a single-payer, Medicare for all system, or go to a system similar to Swiss model, where insurance is not-for-profit and highly regulated.

Flap Doodle 5 years, 7 months ago

If we eliminated 98% of our population and reduced the USA to half the size of South Carolina, we might be able to duplicate the Swiss system. Barring that, not so much.

just_another_bozo_on_this_bus 5 years, 7 months ago

What does population of the country have to do with it (the Swiss population is just under 8 million?)

just_another_bozo_on_this_bus 5 years, 7 months ago

Well, if the sky would fall if we changed to anything logical/sensible, that changes everything. I guess our totally screwed up healthcare is system is really perfect after all.

Silly me.

I'll say 1000 Hail Hayeks and pray to never be tempted by the Socialist Bogeyman again.

Scott Drummond 5 years, 7 months ago

"Third, tax employer-provided health insurance. This is an accrued inefficiency of 65 years, an accident of World War II wage controls. It creates a $250 billion annual loss of federal revenues — the largest tax break for individuals in the entire federal budget."

Right wing propagandist proposes massive tax increase and nary a word from the usual suspects. Hmmmmmmm, wonder why. Overtaxed with worry about impending death panels? Distracted by Presidential birth certificates?

notajayhawk 5 years, 7 months ago

just_another_bozo_on_this_bus (Anonymous) says…

"The only way to fix this mess is to completely scrap the current system, and either go to a single-payer, Medicare for all system, or go to a system similar to Swiss model, where insurance is not-for-profit and highly regulated."

Gee, big surprise. The only two possibilities boohoozo can imagine involve the government running the show. I'm shocked.

By the way, boohoozo: Did you know that in the Swiss system rates are determined by risk, just like in our current system, and not like the proposed 'reform' proposals?

And did you know that one reason costs are lower in Switzerland is that the basic insurance that everyone has to have and insurances companies must provide doesn't cover everything? That 40% of the Swiss carry optional coverage to pay for additional treatment options not covered by the basic insurance, and Swiss insurance companies can refuse or limit coverage for the optional, additional treatments?


porch_person (Anonymous) says…

"The second was where he insisted that there is this orgy of unnecessary tests being performed at hospitals. I don't believe that is true and I submit that insurance companies monitor that activity rather closely."

Gee, it must not be true because poochie says it can't be.

Oh, wait:

http://www.aarpmagazine.org/health/health_care_costs.html

"Indeed, perhaps the most significant reason Americans are drowning in health care debt may shock you: Americans are getting far too much unnecessary care. Of our total $2.3 trillion health care bill last year, a whopping $500 billion to $700 billion was spent on treatments, tests, and hospitalizations that did nothing to improve our health. Even worse, new evidence suggests that too much health care may actually be killing us. According to estimates by Elliott Fisher, M.D., a noted Dartmouth researcher, unnecessary care leads to the deaths of as many as 30,000 Medicare recipients annually."

Hey, pooch - still waiting for that yes-or-no answer you keep ducking out of threads rather than answering. And whose posts are you going to try to plagiarize today?

notajayhawk 5 years, 7 months ago

All that being said, there's a very good reason to follow Krauthammer's suggestion for "targeted measures that attack the inefficiencies of the current system one by one." Even if you don't agree with what those specific targeted measures should be, it only makes sense. If you change a lot of variables at once (or worse, do as Herr Klowne and merrill suggest to scrap the whole system and start over), there's a major problem: If it doesn't work or makes things worse (or even if it does work), we won't know why. Anyone who has even a passing knowledge of research knows that in the scientific method, you don't try to manipulate all the variables at the same time.

just_another_bozo_on_this_bus 5 years, 7 months ago

"Do you folks have any lives outside this forum?"

I can only speak for myself, but , yes, of course I do-- thanks for inquiring. I think. Is there a point to the question, or do you intend to stalk me simply because you can't make a rational argument?

Scott Drummond 5 years, 7 months ago

  1. restrict your ability to sue wrongdoers by undoing the jury system
  2. limit the amount of services provided
  3. raise your taxes.

Interesting plan. Too bad no one on the right was brave enough to offer this legislatively.

Sorry for sharing my ignorance at such a late hour - was out doing some healthy drinking in my life outside this forum.

notajayhawk 5 years, 7 months ago

porch_person (Anonymous) says…

"You did know that you were just repeating Shannon Brownlee's opinion piece, did you not?"

Uh, yeah, cretin, it was Ms. Brownlee's opinion. Even in the part you re-quoted, dolt, did you happen to notice she cited her source? (Pssst - pinhead - Dr. Fisher is a Dartmouth researcher and director of the Center for Health Policy Research - and for some odd reason I trust his opinion more than you being unable to believe it.) Couldn't be bothered to check that out, could you, as 1) it differs from your already-decided delusions, and 2) you have the attention span of a goldfish. And like most liberals (okay, in your case, much worse than most liberals) you can't be bothered to look past the sound bites. If you want to look at what Dr. Fisher actually says, here's a few examples (not that it will make any difference, since you'll dismiss it out of hand, having already decided you can't believe it):

http://www.nihcm.org/~nihcmor/pdf/ExpertV7.pdf

http://www.annals.org/content/138/4/273.full.pdf+html

http://dartmed.dartmouth.edu/spring07/html/atlas.php

Really, poochie, is there no limit to how many times you'll take the opportunity to emabarass yourself?

"On the subject of “your question”, I answered it long ago and I'm waiting for the psychotic outburst when you realize it."

You're a lying troll, poochie, and all your tap-dancing won't change that. But if you did answer the question, pooch, then you won't mind repeating it? Was it yes or no?

(Stand by for another spin cycle full of 'I already answered yada yada yada ...')

Richard Heckler 5 years, 7 months ago

  1. Consumers take control of your own lives and money. Remember it is the medically insured that make up at least 50% of bankruptcies filed today due to health care that is not covered adequately. These insured only thought they were covered only now are losing the bulk of their personal assets. REMEMBER it is our insurance system of today that WILL CANCEL when the going gets tough.

  2. Another perfect example of why National Health Insurance is the only way to go.

  3. There are many reasons why consumers deserve 24/7 care no matter what. The INFLATED expense of treating cancer is but one = too much profit in the business of health care.

  4. Pharmaceuticals operate with huge huge profit margins = consumers getting screwed.

  5. The nations consumers could have excellent National Health insurance for all if one would remove:

elected officials as shareholders special interest campaign funding *the insurance industry recklessly spending health care dollars to bribe votes

  1. Why should consumers seeking health care be expected to support tons of shareholders and campaign contributions while making a health care visit?

  2. Paying out of pocket and setting up health care savings accounts eliminates high dollar reckless spending on:

• the bureaucracy of over 1,500 insurance providers aka profiteers • obscene profits • high corporate salaries • advertising budgets over charges = fraud and theft • sales commissions • Shareholders CERTAINLY increase the cost of insurance • Special interest campaign dollars Golden parachutes * Politicians as shareholders

  1. National Health Insurance WILL NOT walk away flipping a consumer the bird.

Richard Heckler 5 years, 7 months ago

Think National Health Insurance!

The most expensive medical insurance industry in the world is increasing the cost of THEIR insurance daily. Bill Moyers stated that to date the industry had spent $380 million to defeat any sensible reform. Politicians and distributing misinformation does cost a bundle of money http://www.pbs.org/moyers/journal/blog/2009/10/bill_moyers_michael_winship_in.html

However changing nothing will also increase the cost of the most expensive medical insurance in the world. Not too long ago this email came to me, which is a very good indication of what cost increases will look like:

“In front of me I have a document from an employer that shows their cost for insurance.

“Medical, Dental and Vision for the year 2010 an employer will pay $15,450. I will pay another $2860 out of my pay check. $18,310 a year for insurance is ludicrous, and we wonder why so many companies are having massive layoffs. It is a real travesty that nothing is going to happen in the near future on health care.”

There are thousands of expensive insurance medical insurance operations in the USA. These high dollar operations do not provide health care they merely take your money aka "the middle man". What a scam!

notajayhawk 5 years, 7 months ago

Ooh, I just saw where under-the-porch_(alleged)person supposedly answered my question! And all he did was change the question - leaving it in quotes trying to pass it off as what I had asked - before answering!

What a troll.

(And yes, poochie, before you start talking about how none of that means anything because I mispelled 'emabarass', I already noticed.)

Richard Heckler 5 years, 7 months ago

Here is my program for real reform:

Recommendation #1: Drop the Medicare eligibility age from 65 to 55. This should be an expansion of traditional Medicare, not a new program. Gradually, over several years, drop the age decade by decade, until everyone is covered by Medicare. Costs: Obviously, this would increase Medicare costs, but it would help decrease costs to the health system as a whole, because Medicare is so much more efficient (overhead of about 3% vs. 20% for private insurance). And it’s a better program, because it ensures that everyone has access to a uniform package of benefits.

Recommendation #2: Increase Medicare fees for primary care doctors and reduce them for procedure-oriented specialists. Specialists such as cardiologists and gastroenterologists are now excessively rewarded for doing tests and procedures, many of which, in the opinion of experts, are not medically indicated. Not surprisingly, we have too many specialists, and they perform too many tests and procedures. Costs: This would greatly reduce costs to Medicare, and the reform would almost certainly be adopted throughout the wider health system.

Recommendation #3: Medicare should monitor doctors’ practice patterns for evidence of excess, and gradually reduce fees of doctors who habitually order significantly more tests and procedures than the average for the specialty. Costs: Again, this would greatly reduce costs, and probably be widely adopted.

Recommendation #4: Provide generous subsidies to medical students entering primary care, with higher subsidies for those who practice in underserved areas of the country for at least two years. Costs: This initial, rather modest investment in ending our shortage of primary care doctors would have long-term benefits, in terms of both costs and quality of care.

Recommendation #5: Repeal the provision of the Medicare drug benefit that prohibits Medicare from negotiating with drug companies for lower prices. (The House bill calls for this.) That prohibition has been a bonanza for the pharmaceutical industry. For negotiations to be meaningful, there must be a list (formulary) of drugs deemed cost-effective. This is how the Veterans Affairs System obtains some of the lowest drug prices of any insurer in the country. Costs: If Medicare paid the same prices as the Veterans Affairs System, its expenditures on brand-name drugs would be a small fraction of what they are now.

Is the House bill better than nothing? I don’t think so. It simply throws more money into a dysfunctional and unsustainable system, with only a few improvements at the edges, and it augments the central role of the investor-owned insurance industry.

By Marcia Angell, M.D. for Huffington Post. http://www.healthcare-now.org/is-the-house-health-care-bill-better-than-nothing/

(nothing if anything changes until 2014)

Flap Doodle 5 years, 7 months ago

A voice from across the pond suggesting that failing hospitals go private to become more efficient.

"...The state would pay the private sector to deliver health care to the people through those hospitals. It could be done on three- or five-year rolling contracts, with penalty clauses and scope for immediate termination if the businesses could not do the job properly. This would, of course, entail the providers making a profit, which is what the Leftists claim to hate. But when they cry that "no one should make a profit out of health care", they forget that lots of people already do: from those who work in the NHS to its every supplier – drugs companies, equipment manufacturers, building firms. It is time that preposterous argument was buried once and for all."

http://www.telegraph.co.uk/comment/columnists/simonheffer/6672409/Want-to-fix-the-NHS-Go-private.html

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