I am fed up with the posturing of both liberals and conservatives on the issue of health care reform. We need solutions, and the demonizing and finger-pointing just gets in the way of real reform.
Our common problem is that health care is about twice as expensive in the United States as in other countries, and is growing ever more expensive. Americans spend over $2.4 trillion per year on health care. That amounts to over $7,000 per person, or 16.7% of our gross domestic product. The rate of growth in the cost of health care is substantially higher than increases in individual income or GDP; accordingly health care will take a higher and higher percentage of our personal and national resources. At current rates within 50 years we will be spending more on health care than we earn.
Cost is the core of the problem. It is because of the high cost of health care that so many people are uninsured or underinsured. It is because of the high cost of health care that so many people with chronic condictions like diabetes or heart disease go without proper treatment, resulting in America being ranked last in health care delivery among industrialized nations. High cost limits access and degrades the quality of care that people receive.
But neither liberals nor conservatives are addressing the problem of cost. Liberals have decided that the whole problem is the "greedy" health insurance companies. Private health insurance is the devil, and for them the problem will be solved when the devil has been exorcised. Health insurance companies are hauled over the coals for setting premiums too high or for denying coverage for preexisting condictions or for refusing to pay for new and experimental treatments. Among liberals the holy grail is the "public option" – a government-run health care system.
I have news for the liberals. Once the government has the responsibility of paying for health care, it will have to make the same tough decisions that private health insurers do now. Someone has to decide how much the premiums will be for public health insurance. Someone has to decide which treatments have been proven to be effective and which have not. Someone has to decide whether to order another round of tests. And ultimately, someone will have to decide whether or not treatment in a particular case is futile. Neither money nor medical care grows on trees – someone has to pay for all this treatment, and someone will have to decide whether treatment is warranted in a particular case, or else costs will simply continue to escalate. I would not want to be the elected or appointed public official taking responsibility for those decisions. Once the government is paying for health care liberals may wish that the "greedy" private insurance companies were back making these decisions.
Conservatives are even worse. They keep saying, "let the private market solve this problem." Great. Are conservatives about to create a competitive market in either the health insurance industry or the health care industry? Have conservatives suddenly discovered that, left to itself, the free market tends towards oligarchy and monopoly? Are conservatives going to enact reforms that will lower the cost of health care for the average person? I see absolutely no evidence of that. Instead we are fed a steady diet of snide remarks about "Obamacare" and fantasies of "death panels" – and meanwhile Republicans in Congress have not submitted a single bill proposing health care reform!
Republicans are AWOL, so by default, it is up to the Democrats to solve the problem – and the problem is not the existence of private insurance companies, but the high and escalating cost of health care. Moving forward, keep your eyes on that factor – nothing else matters. If costs come down then more people will be able to pay for health care. If we don't get a handle on costs then it will make no difference whether health care is paid for privately or with tax dollars – we won't be able to afford it.
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Republicans have floated a number of ideas, professor. It is a myth that they haven't, another empty talking point, really. If anyone's AWOL in this it is Obama, who hasn't added anything outside throwing around a bunch of campaign slogan-style statements and phoney-baloney statistics.
The only thing this debate has shown is that this group of congress people and this president are not the folks who should be entrusted with reforming anything.
Larry,
The Republicans controlled Congress from 1994 to 2006, and the Presidency from 2000 to 2008. They did nothing to address the cost of health care. The major health insurance legislation that was adopted during that period extended Medicare coverage to presecription drugs, which was a great idea – except that it is the single most expensive expansion of government health care since Medicare was adopted, and nothing was done to pay for it. (Kind of like the War in Iraq.) President Obama has made health care financing reform his principal legislative priority because it is the single greatest problem that we face. If we don't get the cost of medical care under control then our economy will be ruined. You are correct that Republicans have "floated a number of ideas," but they haven't stepped up to the plate legislatively – they are sitting on the (back) bench lobbing grenades. OK, not a perfect metaphor. What is the comprehensive Republican plan for bringing down costs? The only "plan" that I hear coming from that side is to expand tax deductions for the cost of private health insurance, which would have two effects – it would proportionately benefit people with high incomes who already have great health insurance, and by increasing demand among this group it would drive up the cost of private health insurance for themselves and everyone else. That's basically what we have been doing for the last couple of generations, and it's why we are in such trouble now.
OK, enough fingerpointing, Will. Unlike a lot of Democrats, I don't think that private insurance companies are the problem – it is the structure in which they operate. I think that private companies operating in a competitive environment deliver superior service at a lower price as compared to government agencies. But for whatever reason, either because of collusion or because like utility service this field lends itself to "natural monopolies," health insurance companies are not operating in a competitive environment, and the result is artificially higher cost.
There is another important fact to keep in mind here. Health insurance companies do not deliver health care. They are strictly brokers, and are not necessary to the final equation. It may be that private companies could serve a valuable role in keeping costs down. As I say in the principal posting, private insurers are likely to do a much better job of utilization review than the government is. Someone has to say "no" to patients who want medical care that is expensive and unnecessary. Someone has to create networks of doctors and hospitals and and enter into contracts with them. Premiums have to be collected and payments made to physicians and hospitals. But it may not be cost effective to have payment for health care funneled through the corporate treasuries of private insurers. Instead the government could hire private companies on a "low bid" basis to perform some or all of these functions.
The key is to reduce costs.
Anyway, Larry, thanks for the comment and thanks for reading.
The Republicans did not control congress from 1994-2006. They took control in 1995, after the 1994 elections. There were also 2 years where they did not hold a majority in the Senate. For almost 1/2 of the year 2001 there was a tie. The Republicans allowed themselves to be somewhat bullied by the media and not take full advantage of the Vice-President's tie breaking vote. Plus the added handicap of this being the time that the Executive branch tries to get it's confirmations completed. Then of course, thanks to Senator Jumpin' Jim Jeffords, the Democrats held the majority for the remainder of the term. So at best, you could give the Republicans credit for a half year in control vs. the two in your statement. No offense but, I have been seeing this a lot lately on comment boards and I wanted to set the record straight.
Additionally, let us be honest about the party that has had a lock on Congress. It has been just over three quarters of a century since FDR was elected. Democrats have controlled both Houses of Congress for 56 of those years, compared to just 14.5 for the Republicans. Plus Dems have controlled both houses and the Presidency for 33 years, that is six times the 6.5 years that the Republicans controlled all three. And you feel it is appropriate to ask where were the Republicans? There was a previous attempt, but it chaired by First Lady Hillary Clinton, not a political power broker.
If it is the right thing to do, you stay at it. Compare this to John Kasich's attempt to balance the Federal Budget. When he first introduced a balanced budget he got something like 17 votes. But he kept introducing it year after year. Finally, it passed in 1997.
And then you play down the Medicare prescription drugs fix, because it wasn't paid for. This was a legitimate crisis. People were in a position to decide between medication and food or rent. People were actually not taking prescribed medication. Compare this to today's manufactured health care insurance crisis. There are people who do not have insurance, but there are not people not receiving health care. Where are the lines outside of hospitals of people waiting for care? There are laws that say you must treat the sick or injured. There was no law that said you had to give them medication.
There is much sleight of hand to make it seem like this will be paid for. Not the least of which is to have us pay for this plan for 10 years, but only put the plan in place for 8 years. Any thoughtful auditor would call this smoke and mirrors. What about the next decade? Will there be 2 years without health care to balance this?
Professor,
You state that "our common problem" is th high cost of health care in the US as compared to other countries. I disagree. If cost is "the core of the problem", then what is the correct amount? As you acknowledge, for costs to be reduced, some treatments will have to be denied. Rationing anyone?
The real problem is that health insurance has come to be seen as an entitlement. This manifests inteslf in many ways.
First, health insurance is tied to employment. Although there may historical reasons that health insurance is viewed as a benefit to employment (which are reinforced by our present tax code), there are no logical reasons why this should be so. Automobile and homeowners insurance are not typically provided by employers. Reform that would allow the tax benefits of employer sponsored health insurance to be enjoyed by indviduals would be a large step in addressing this anomoly.
This points to a second and more fundamental problem. Health insurance is not really insurance as that term is understood in other contexts. Rather it is, in many respects, an elaborate (and unnecessary) system to shift costs to other parties. When my car requires an oil change or a brake job, I do not consult my auto policy to see whether my mechanic is "in network". When my home needs a new coat of paint, I do not struggle with my homeowners policy to determine my "copay". Yet for the most routine medical expenditures, we have created an army of clerks and accountants to process payments and forms. This is ludicrous. I obtain automobile insurance to guard against large losses, not to cover routine maintence. Health insurance should operate the same. It should insure against catasrophic losses, not routine dental checkups.
This change alone would result in great savings as it would do away with the cost of processing insurance claims for routine costs (as opposed to creating a new federal bureaucracy, which can only add to costs). It would also nullify the debate on whether any reform bill should cover elective abortion The answer is "no" because it would not cover any elective procedures. I don't have to pay for your abortion and you don't have to pay for my face-lift.
Third, we need less government involvement, not more, in the actual detail of policy language and mandated coverages. Such involvement simply feeds tha idea of entitlement. Beyond clearing the field for competion and providing the same tax advantages discused above, the government should get out of the way.
Government can help by allowing insurance companies to sell across state lines. This will increase competition (which will drive down costs for the Professor) and increase choice. Aren't we all pro-choice on this issue?
So I agree with the Professor in calling down curses on both libeals and conservatives, but for markedly different reasons. Absent such a common sense approach, I prefer to see no legislation on health care "reform".
You argue that repubs haven't added much to the debate but then state that a primary concern is lack of competition among insurers. Yet, the one consistent message repubs have delivered over the last year is the need to allow competition across state lines. Dems seem slow to consider this step. And here we are several months into the debate and we're finally starting to hear about the possibility of rescinding an anti-trust exemption, but merely as political payback for an industry report the dems don't like.
Like I said, the only thing this debate has shown is that this isn't the group of politicians that should be entrusted with such important reform. The vast majority of Americans want some kind of reform but the trust isn't there, for good reason.