Tuesday, August 4, 2009

The Health Care Debate

Health care obviously is the new hot topic for those of us who are passionate about our politics, and for good reason. Obama was trying desperately to get something through Congress and he's now looking to get something passed this year. In this space, I don't want to try to answer the question, "What's the hurry", I've heard this addressed elsewhere, but really there is no hurry.

Obama is not trying to completely overturn health care from something we have now to something much, much different. He's trying to improve the system incrementally, slowly, in hopes of moving it toward something better. This is the right approach. Health care makes up 20% of our economy, we spend something like $2 trillion dollars on health care costs every single year. And the cost is going up. Because costs are going up faster than inflation and because costs are so expense, we desperately need reform. Health care expenses, more than anything else, is the biggest threat to our nation's long term solvency. But because its so complicated, we need to move reform incrementally, and that's exactly what Obama and Congress is looking to do.

And we need to move reform incrementally because that is the only sane way to do it, and incrementally is the usual way its been done. This really thoughtful essay on health care reform spends some time on how other countries went about providing universal access to its citizens.

"Every industrialized nation in the world except the United States has a national system that guarantees affordable health care for all its citizens. Nearly all have been popular and successful. But each has taken a drastically different form, and the reason has rarely been ideology. Rather, each country has built on its own history, however imperfect, unusual, and untidy."


"This is the trouble with the lure of the ideal. Over and over in the health-reform debate, one hears serious policy analysts say that the only genuine solution is to replace our health-care system (with a single-payer system, a free-market system, or whatever); anything else is a missed opportunity. But this is a siren song.

Yes, American health care is an appallingly patched-together ship, with rotting timbers, water leaking in, mercenaries on board, and fifteen per cent of the passengers thrown over the rails just to keep it afloat. But hundreds of millions of people depend on it. The system provides more than thirty-five million hospital stays a year, sixty-four million surgical procedures, nine hundred million office visits, three and a half billion prescriptions. It represents a sixth of our economy. There is no dry-docking health care for a few months, or even for an afternoon, while we rebuild it. Grand plans admit no possibility of mistakes or failures, or the chance to learn from them. If we get things wrong, people will die. This doesn’t mean that ambitious reform is beyond us. But we have to start with what we have."

and his take on Massachusett's plan is enlightening:

"Massachusetts, where I live and work, recently became the first state to adopt a system of universal health coverage for its residents. It didn’t organize a government takeover of the state’s hospitals or insurance companies, or force people into a new system of state-run clinics. It built on what existed. On July 1, 2007, the state began offering an online choice of four private insurance plans for people without health coverage. The cost is zero for the poor; for the rest, it is limited to no more than about eight per cent of income. The vast majority of families, who had insurance through work, didn’t notice a thing when the program was launched. But those who had no coverage had to enroll in a plan or incur a tax penalty."

And the vast majority of those folks who live there don't want to go back.

The problem is that those who oppose reform make arguments that just don't make sense. Calling Obamacare socialist or worse.

I was recently sent this youtube link with John Stossel's take on health care. And he constantly kept comparing health care with cars or food. And providing a false choice between what we have now and Soviet Union socialism. Providing Michael Moore as the one opposing voice. Cherry picking facts about specific short comings of the Canadian system. John Stossel is a libertarian ideologue. Nothing wrong with that, but we need to have a sensible discussion on this issue. Stossel made some interesting points, but he also failed to address many of the specific problems with our system, problems he even brings up on this show.

And Stossel offers one of the most sensible voices of opposition to health care reform. Most are just nonsense, plain and simple.

I hope that we can all agree that everyone should have access to health care. The US system has, more or less provided a model for it over the years, and its largely a patchwork. Medicare for the elderly , medicaid for the poor (systems most similar to Canada's), veteran's have their system (a system modeled after the UK's). Most everyone else is covered through an employer provided insurance. And a big employer acts in many ways like a government would. Big companies have enough employers to be covered by a single insurance company (I have a choice of two) and negotiate a single rate for all of its employees regardless of a person's health. And they won't be kicked out if they get expensive. I haven't tested this yet and I'm not sure about it, but generally speaking I think employer based insurance will cover even pre-existing conditions?

I say I'm not sure because I have a diabetic daughter. If I lose my job (and my insurance) should I pay for COBRA (which is very expensive and would quickly eat away my savings) to avoid having an insurance gap? I think so, but I need to find out for sure.

But there are millions of Americans who are forced into the individual markets because they are either self-employed or work for an employer who doesn't provide insurance. Many others lose their insurance when they lose their jobs. Employer based plans are no-where near optimal and we need to either augment it with something else.

In my opinion, any health insurance plan must have the following attributes:

1) Cannot kick someone off the plan as soon as they get too expensive.
2) Cannot kick someone off the plan because of pre-existing conditions.
3) Uniform premiums to everyone regardless of health.
4) Everyone most be required to have insurance.
5) The poor must be given assistance so that no one is unable to afford coverage.

This is the basic model of the Massachussett's plan. And its a good one.

The fact is that currently insurance companies have an economic incentive to kick people off their plans if they get expensive. They'll make the applications confusing and complicated, and they'll allow you to pay the premiums, but if you get diagnosed with an expensive to treat illness, your application will be scrutinized to find a reason to kick you out.

The simple fact is the young and healthy have to subsidize care for those who are old and sick. If you have a system where the healthy choose not to pay for it, it becomes prohibitively expensive for those who need it. Since everyone is going to get old sometime, it makes some sense to spread the cost to everyone.

The final issue that must be dealt with in the health care debate is cost, and this is a tricky issue also dealt with in this excellent essay and its analysis of the county that provides the most expensive health care per person in the country.

The problem is that doctors have an economic incentive to over-do medicare treatment. They are paid per visit/per surgery/per drug prescription.

One example:

"Seeing a patient who has had uncomplicated, first-time gallstone pain requires some judgment. A surgeon has to provide reassurance (people are often scared and want to go straight to surgery), some education about gallstone disease and diet, perhaps a prescription for pain; in a few weeks, the surgeon might follow up. But increasingly, I was told, McAllen surgeons simply operate. The patient wasn’t going to moderate her diet, they tell themselves. The pain was just going to come back. And by operating they happen to make an extra seven hundred dollars."

But cost and quality do not go together:

"This is a disturbing and perhaps surprising diagnosis. Americans like to believe that, with most things, more is better. But research suggests that where medicine is concerned it may actually be worse. For example, Rochester, Minnesota, where the Mayo Clinic dominates the scene, has fantastically high levels of technological capability and quality, but its Medicare spending is in the lowest fifteen per cent of the country—$6,688 per enrollee in 2006, which is eight thousand dollars less than the figure for McAllen. Two economists working at Dartmouth, Katherine Baicker and Amitabh Chandra, found that the more money Medicare spent per person in a given state the lower that state’s quality ranking tended to be. In fact, the four states with the highest levels of spending—Louisiana, Texas, California, and Florida—were near the bottom of the national rankings on the quality of patient care."


"That’s because nothing in medicine is without risks. Complications can arise from hospital stays, medications, procedures, and tests, and when these things are of marginal value the harm can be greater than the benefits. In recent years, we doctors have markedly increased the number of operations we do, for instance. In 2006, doctors performed at least sixty million surgical procedures, one for every five Americans. No other country does anything like as many operations on its citizens. Are we better off for it? No one knows for sure, but it seems highly unlikely. After all, some hundred thousand people die each year from complications of surgery—far more than die in car crashes."

and finally:

"As America struggles to extend health-care coverage while curbing health-care costs, we face a decision that is more important than whether we have a public-insurance option, more important than whether we will have a single-payer system in the long run or a mixture of public and private insurance, as we do now. The decision is whether we are going to reward the leaders who are trying to build a new generation of Mayos and Grand Junctions. If we don’t, McAllen won’t be an outlier. It will be our future."

Health care is an intensely complicated and important subject. It deserves pragmatic and careful thought and discussion. As human beings we tend to think through issues with ideological blinders. Lets not be ideological about our health.


proud parents said...

My concern is about those who would abuse a free system. All those that mooch off of programs like Medicaid, AHCCCS, disability, SSI, etc. would then be taking advantage of coverage provided by everyone else but themselves.
And what about elective care like cosmetic surgery or unnecessary pregnancy termination?
Without addressing these issues, the plan still sounds pretty ideological to me.
Can you address these points for clarification?

tempe turley said...

I don't think elective care should be covered by insurance (and it isn't typically). But "elective" is somewhat subjective, so you'll never have a perfect system in this regard.

I'm not advocating free by the way, I'm advocating affordable. Our current system is not free. Folks still have premiums and deductibles, etc. I'm just proposing, we find a way to expand what we currently have to those who aren't getting it. Either find a way to expand employer based plans to more people. Expand medicare to more folks, etc.

The goal is to cover everyone. In my view, there are many ways to get there. That's not ideological at all, in my opinion.

proud parents said...

Hmmm, maybe you're right. Maybe it's not ideological. Maybe ideological is not the right word.
I can agree with the principle of it. I would love a world where everyone has insurance, everyone has jobs, everyone has houses . . .
But the sad fact is, some people don't want jobs, some people can't handle a house, and some people just don't care about their health. So why should this be thrust upon them at the expense of others, whether they like it or not?
Can't it be more of an open-door policy: "For those who are interested, please inquire within"? I don't mind paying for those who can't afford it, but want and need it. I just don't like the idea of throwing my money at someone who could care less, or worse, tries to rob me of every penny.
Or am I just not getting it?
By the way, what's your take on illegal aliens and coverage?

I can't help, when I read your posts of this nature, to reflect on the parable of the talents. But our interpretations of that are a different debate altogether. :)

(Haha, the security word verification is "holywor". Almost sounds like something else, if you replace an "o" with an "a"!)

tempe turley said...

I guess I don't understand your concern... If everyone is required to pay into it (even the young and healthy who may not be interested in it), that will make premiums less not more.

If you don't care about your health and trash it, I don't know how being covered matters or not. You're not going to seek out preventive care either way, so the cost won't matter. But even now, you're covered since anyone who comes to the emergency room has to be treated right now whether they can afford the treatment or not.

tempe turley said...

Forgot to answer your question on illegal immigrants. But let me say, I don't think that question is relevant. Our illegal immigrants covered now? Yes, if they come to our emergency rooms, I don't think that's ever going to change. Should we have some for fee like service? Probably. Should they be covered by employers insurance? No, since legally they can't be employed. But some of them are since they are able to fake insurance.

Should they be covered by something like medicare if we do expand that to cover the current uninsured? I don't know...

Again, this is a different issue.

Let's focus first on getting Americans covered adequately and appropriately.

H said...

If I understand the Mass. plan correctly, ALL residents were REQUIRED to sign up for some type of health coverage. I think this is where Jennifer's concern is. Why should a poor person, that doesn't care about their health have to sign up, and let everyone else pay for it? That's a perfectly logical question, in my mind. The other side is the working population that don't think they need health care and will opt out unless they are penalized for it (which is what Mass. is doing). As a young, working, college student I fell into that latter category because I didn't appreciate the necessity of health care coverage. I got lucky, and didn't need it. Others are not so lucky and pay dearly for it. Mandatory insurance seems like a big stretch, but I certainly like the 8% max of your income for spending. That seems to make sense.

Out of curiosty...Health care makes up 20% of our economy, what is the rest of the 80% spent on? (or at least give me another bracket of spending) $2 trillion/year means nothing to me unless someone puts it into perspective for me. Can you do that? Like, how much do we spend on food or child care or education. Just wondering.

tempe turley said...


Requiring all people to pay for health insurance is important unless you are ok with our system rejecting folks because of pre-existing conditions.

If you force insurance companies to accept anyone who wants to join even those with a pre-existing medical condition, but you don't make it a requirement for everyone including the young and healthy to join, you are asking for the young and healthy not to join until they need it, and this would bankrupt the system.

When I was young and single I had health insurance both because it was affordable (in my employer based plan) and because I knew there was a chance something might happen and I would need it.

But say I didn't get it, and I broke my leg, so I went ahead and signed up at the hospital so I could get my leg worked on and not pay for it. Or say I was diagnosed with cancer, and signed up since I knew I would need really expensive treatments.

Currently, health insurances would reject me for that, which makes sense I guess, except now they use the pre-existing conditions excuse to kick a lot of people off the rolls for a lot more nefarious reasons.

Personally, I hate that insurance companies won't cover claims because of pre-existing conditions, but you can't change this unless you make it a legal requirement for everyone to take it.

And you need the young and healthy to subsidize health care costs to make it affordable for the old and sick. The more young and healthy opt out, the more the old and sick will have to pay. Since we'll all get old, and we all could get expensively sick, I think this is a fair trade-off.

tempe turley said...

Helena, regarding your GDP question, I don't know, but 20% sounds a lot to me... Another way to look at it is that on average, someone spends 20% of what they make on health care. Maybe that's ok, but the percentages are increasing, meaning that health care costs are taking up a greater portion of our total costs which of course is not sustainable.

I'll see what I can do when I have more time.

proud parents said...

H, thanks for articulating what I had trouble expressing. You hit it on the head! The HEAD, girl!

I appreciate the response as well, but I still have a few more concerns.
Keep in mind I'm not trying to poke holes in the plan, I just want to understand it better. I agree; no system is perfect. I just want to make sure the imperfections, or cons, are vastly outweighed or compensated for in some way by the pros--this tells me that this is a worthwhile venture. Change is scary, no matter how bad you want it! (Remember when that first pregnancy stick turned blue???)
I also agree that for this reason, and for the complicated nature that is health care reform, it's best to make it a slow transition so as to not err or cause confusion or panic--or at least to be able to rectify any unforeseen negative outcomes or faux pas that may occur quickly and early in the game.
Furthermore, I agree that change is necessary!

But still, I have a few more concerns . . .

tempe turley said...

Yes, I think if we can all agree with the hopefully non-controversial statement that everyone should have access to health care, then we can work together to get to that goal... I don't think we should throw away what we have now, we need to make it work better for more people.

tempe turley said...

By the way, just to be clear, a requirement for every one to be insured is not in the bill floating through Congress right now. Obama got hit over the head by Hillary Clinton for not having that requirement in his plan (she did). Instead, Obama campaigned on the idea that if you get insurance costs down, folks will sign up voluntarily.

Mandatory insurance is something I personally support, but its not in any version of any bill currently floating through Congress (as far as I'm aware). Just wanted to clarify.