Debunking another popular myth
Apr. 13th, 2005 08:58 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
windelinaPaul Krugman's latest deals with healthcare:
Those of us who accuse the administration of inventing a Social Security crisis are often accused, in return, of do-nothingism, of refusing to face up to the nation's problems. I plead not guilty: America does face a real crisis -- but it's in health care, not Social Security.
Well-informed business executives agree. A recent survey of chief financial officers at major corporations found that 65 percent regard immediate action on health care costs as "very important." Only 31 percent said the same about Social Security reform.
But serious health care reform isn't on the table, and in the current political climate it probably can't be. You see, the health care crisis is ideologically inconvenient.
Let's start with some basic facts about health care.
Notice that I said "health care reform," not "Medicare reform." The rising cost of Medicare may loom large in political discussion, because it's a government program (and because it's often, wrongly, lumped together with Social Security by the crisis-mongers), but this isn't a story of runaway government spending. The costs of Medicare and of private health plans are both rising much faster than gross domestic product per capita, and at about the same rate per enrollee.
So what we're really facing is rapidly rising spending on health care generally, not just the part of health care currently paid for by taxpayers.
Rising health care spending isn't primarily the result of medical price inflation. It's primarily a response to innovation: The range of things that medicine can do keeps increasing. For example, Medicare recently started paying for implanted cardiac devices in many patients with heart trouble, now that research has shown them to be highly effective. This is good news, not bad.
So what's the problem? Why not welcome medical progress, and consider its costs money well spent? There are three answers.
First, America's traditional private health insurance system, in which workers get coverage through their employers, is unraveling. The Kaiser Family Foundation estimates that in 2004 there were at least 5 million fewer jobs with health insurance than in 2001. And health care costs have become a major burden on those businesses that continue to provide insurance coverage: General Motors now spends about $1,500 on health care for every car it produces.
Second, rising Medicare spending may be a sign of progress, but it still must be paid for -- and right now few politicians are willing to talk about the tax increases that will be needed if the program is to make medical advances available to all older Americans.
Finally, the U.S. health care system is wildly inefficient. Americans tend to believe that we have the best health care system in the world. (I've encountered members of the journalistic elite who flatly refuse to believe that France ranks much better on most measures of health care quality than the United States.) But it isn't true. We spend far more per person on health care than any other country -- 75 percent more than Canada or France -- yet rank near the bottom among industrial countries in indicators from life expectancy to infant mortality.
This last point is, in a way, good news. In the long run, medical progress may force us to make a harsh choice: If we don't want to become a society in which the rich get life-saving medical treatment and the rest of us don't, we'll have to pay much higher taxes. The vast waste in our current system means, however, that effective reform could both improve quality and cut costs, postponing the day of reckoning.
To get effective reform, however, we'll need to shed some preconceptions -- in particular, the ideologically driven belief that government is always the problem and market competition is always the solution.
The fact is that in health care, the private sector is often bloated and bureaucratic, while some government agencies -- notably the Veterans Administration system -- are lean and efficient. In health care, competition and personal choice can and do lead to higher costs and lower quality. The United States has the most privatized, competitive health system in the advanced world; it also has by far the highest costs, and close to the worst results.
Over the next few weeks I'll back up these assertions, and talk about what a workable health care reform might look like, if we can get ideology out of the way.
***************************
Hunh. Well, I've known that the US has terrible infant mortality rates for an industrialized country.
I guess we're discovering yet another area where we're not "#1".
Those of us who accuse the administration of inventing a Social Security crisis are often accused, in return, of do-nothingism, of refusing to face up to the nation's problems. I plead not guilty: America does face a real crisis -- but it's in health care, not Social Security.
Well-informed business executives agree. A recent survey of chief financial officers at major corporations found that 65 percent regard immediate action on health care costs as "very important." Only 31 percent said the same about Social Security reform.
But serious health care reform isn't on the table, and in the current political climate it probably can't be. You see, the health care crisis is ideologically inconvenient.
Let's start with some basic facts about health care.
Notice that I said "health care reform," not "Medicare reform." The rising cost of Medicare may loom large in political discussion, because it's a government program (and because it's often, wrongly, lumped together with Social Security by the crisis-mongers), but this isn't a story of runaway government spending. The costs of Medicare and of private health plans are both rising much faster than gross domestic product per capita, and at about the same rate per enrollee.
So what we're really facing is rapidly rising spending on health care generally, not just the part of health care currently paid for by taxpayers.
Rising health care spending isn't primarily the result of medical price inflation. It's primarily a response to innovation: The range of things that medicine can do keeps increasing. For example, Medicare recently started paying for implanted cardiac devices in many patients with heart trouble, now that research has shown them to be highly effective. This is good news, not bad.
So what's the problem? Why not welcome medical progress, and consider its costs money well spent? There are three answers.
First, America's traditional private health insurance system, in which workers get coverage through their employers, is unraveling. The Kaiser Family Foundation estimates that in 2004 there were at least 5 million fewer jobs with health insurance than in 2001. And health care costs have become a major burden on those businesses that continue to provide insurance coverage: General Motors now spends about $1,500 on health care for every car it produces.
Second, rising Medicare spending may be a sign of progress, but it still must be paid for -- and right now few politicians are willing to talk about the tax increases that will be needed if the program is to make medical advances available to all older Americans.
Finally, the U.S. health care system is wildly inefficient. Americans tend to believe that we have the best health care system in the world. (I've encountered members of the journalistic elite who flatly refuse to believe that France ranks much better on most measures of health care quality than the United States.) But it isn't true. We spend far more per person on health care than any other country -- 75 percent more than Canada or France -- yet rank near the bottom among industrial countries in indicators from life expectancy to infant mortality.
This last point is, in a way, good news. In the long run, medical progress may force us to make a harsh choice: If we don't want to become a society in which the rich get life-saving medical treatment and the rest of us don't, we'll have to pay much higher taxes. The vast waste in our current system means, however, that effective reform could both improve quality and cut costs, postponing the day of reckoning.
To get effective reform, however, we'll need to shed some preconceptions -- in particular, the ideologically driven belief that government is always the problem and market competition is always the solution.
The fact is that in health care, the private sector is often bloated and bureaucratic, while some government agencies -- notably the Veterans Administration system -- are lean and efficient. In health care, competition and personal choice can and do lead to higher costs and lower quality. The United States has the most privatized, competitive health system in the advanced world; it also has by far the highest costs, and close to the worst results.
Over the next few weeks I'll back up these assertions, and talk about what a workable health care reform might look like, if we can get ideology out of the way.
***************************
Hunh. Well, I've known that the US has terrible infant mortality rates for an industrialized country.
I guess we're discovering yet another area where we're not "#1".
![[identity profile]](https://www.dreamwidth.org/img/silk/identity/openid.png){kind=small}
no subject
Date: 2005-04-13 04:11 pm (UTC)went up to a window told them what's up. sat down. 5 minutes (no exaggeration) a woman asked me into this room. she helped me fill a form out because i didn't know german. this form was one page. i didn't have jack for information, all i had was my host family's name and the town they lived in. no phone, no address. keep in mind also that i'm obviously a foreigner. so we fill out this form, it takes a few minutes but as she's doing that this other lady is prepping me for surgery, doctor comes in does the surgery, they give me a piece of paper and say come back in a few days. i go out of that room and around the counter is the pharmacy where my prescription is already filled and i'm on my way home. seriously, i the whole thing took about half an hour!
i went back three times for follow ups and every time it was the same, _no_ waits, super nice people, insane efficiency.
so that's that. compare that to experiences i've had in us military hospitals or the hcmc downtown that were agonizingly bureaucratic and inefficient makes it clear that it's not government healthcare = sucky and expensive or market competition = awesome. execution is definitely a factor.
people act like it's all impossible to do socialized healthcare and when i tell them i have experienced this impossibility they get all stupid and are just against it. why can't we do what germany did, why we can't just copy them? i really don't understand what the problem is. it seems to me some people are just irrationally clinging to some cold war pinko fear that is just silly.
no subject
Date: 2005-04-13 04:42 pm (UTC)no subject
Date: 2005-04-13 06:25 pm (UTC)anyway, i think the price tag is fine especially when i think there would be all kinds of other auxillary benefits for society. i think people not having to worry about getting sick and being screwed would have a really nice general effect on society. i don't know how to prove that.
i get confused about the price tag. most of my healthcare costs go to paying towards the chance i might have a serious accident that i most likely will never have. i would prefer it if that money could go towards more preventative general care but i can't get that preventative care because i can't risk going without the insurance against catastrophy. i'd be curious to know how much insurance payments go 'unused' to get an idea of costs. like how many people paying a couple hundred bucks a month insurance for years and years never use any benefits? where does that money go? how does the total amount of insurance paid by all people in this country line up with the total cost of healthcare?
no subject
Date: 2005-04-14 12:57 am (UTC)That's a really good question. Most people have major medical insurance which pays 80% (or some large percentage) of the bill for doctor visits and such; some people have HMOs which do offer some preventative care and "lifecare" services intended to get you living a healthier lifestyle, but also act like major medical so long as you only see the HMO's doctor and pharmacy; some people have PPOs which are like major medical except you get a price break for using only doctors and pharmacies in their network. I don't know of too many places that offer only catastrophic insurance, which pays off if you have an extended hospital stay but doesn't cover anything else.
no subject
Date: 2005-04-14 03:15 pm (UTC)no subject
Date: 2005-04-15 12:26 am (UTC)no subject
Date: 2005-04-13 08:53 pm (UTC)I recently listened to a couple of conservative economists discussing health care on MPR. They were asked if most corporations would really be willing to accept the higher tax burden of nationalized health care.
Both of them said corporations would most likely embrace it because what they would pay in increased taxes would be a fraction of what they currently pay for employee benefits.
I don't think that the price tag for most Americans would be all that difficult to swallow.
no subject
Date: 2005-04-14 12:46 am (UTC)One of my major concerns about nationalized health care (aside from a complete lack of faith in the Feds' ability to do a good job with it) is that it doesn't really solve the problem I mentioned in my other comment - people will still run to the doctor for every sniffle and sore throat. Doctors will still practice defensive medicine, and nobody will have any incentive to exercise any discipline in health care spending since it's all paid for by the government.
I wasn't in favor of W's prescription boondoggle, and this is just the same deal squared, cubed, and served up to everyone. Even forcing those who are deliberately uninsured into he program isn't going to be enough to feed this beast, I'm afraid.
no subject
Date: 2005-04-15 03:14 pm (UTC)Actually they discussed that as well. One of the biggest issues small business owners have is health care costs. The costs are so high they can't afford to carry it but most employees want it. It is one of the main reasons so many small businesses are failing right now (according to the economists on this program).
Again, a national health care program would take considerable burden off these companies and allow them to be more competitive.
The other issue is the fact people are reluctant to start new businesses because it means they will not be able to afford health insurance. They felt that the health care cost crisis in the US is currently the largest problem for small business. The health care crisis is crippling entrepreneurship in our country.
no subject
Date: 2005-04-16 02:49 am (UTC)So the bottom line is that we have a health insurance system left over from the 1940s wage & price freeze laws, complicated with dozens of state mandates. I don't see how adding more government regulations and bureaucracy is going to solve either of these problems, unless you think the Feds are going to peel back coverage to the bare essentials.
no subject
Date: 2005-04-13 04:39 pm (UTC)Seriously, the health care system is pretty badly screwed up, and I think a lot of it is because most health insurance isn't really health insurance, it's more like prepaid care. So people tend to go running to the doctor for every sore throat and sniffle, which drives up the cost...and there's no good way to comparison shop between doctors and clinics, at least not yet, which is another thing that drives up costs. Don't even get me started on Medicare.
One thing I notice he doesn't mention about the VA: a lot of the efficiency he touts has come from the current administration closing down a lot of VA hospitals (many of which were providing horrible care) and having a lot of veterans dealt with on an outpatient basis or through home health care.
no subject
Date: 2005-04-13 05:24 pm (UTC)The sad thing, is that we have to charge patient's outside insurance plans and charge higher co-payments because of the budget issues.....
no subject
Date: 2005-04-13 07:37 pm (UTC)I realize I'm hearing it from the patient's point of view and I know there are good VA hospitals. There also seem to be some pretty terrible ones, though. This likely stems from the budget cuts. I find it funny that the author touts the efficiency of the VA, but it looks like efficiency for some is achieved by forsaking care for many others.
no subject
Date: 2005-04-13 08:20 pm (UTC)no subject
Date: 2005-04-14 12:52 am (UTC)no subject
Date: 2005-04-14 12:48 pm (UTC)no subject
Date: 2005-04-15 12:20 am (UTC)no subject
Date: 2005-04-15 12:51 pm (UTC)no subject
Date: 2005-04-14 02:10 am (UTC)A very big reason heath care is so expensive is also because americans are so fucking unhealthy. We are fat and lazy. Nobody exercises. And the majority of shit thinly disguised as food that we do put in our bodies are toxic.
So I think for anybody who wants free health care, here is a solution (and free). Why don't we all put down the Doritos, stop going to fast food joints and start exercising for 45 minutes a day and try to prevent poor heatlh. After all, if we all started getting healthy, health care costs would go down.
No I know it's a pipe dream to think we as americans want to assume any personal responsability regarding our own health. But when one is 60 and looks back on their life and sees that they ate like shit, barely did any form of exercise. Don't be shocked if you're broke, in a wheel chair looped up on a ton of drugs with a few months to live.
Now... where did I put my remote control, because there is no way I am getting up from the couch to change the channel. :)
no subject
Date: 2005-04-15 12:25 am (UTC)Come to think of it, between diabetes and its side effects and the increased strain on the heart, obesity tends to kill people off pretty early. There's a reason you don't see too many old fat people around, and it's not because they keep them locked up in the nursing homes.
no subject
Date: 2005-04-15 12:59 am (UTC)My main point is that there a things the government shouldn't be completely responsible for. there are a ton of ways that people can help themselves in living a longer healthy life. I know not every disease is preventable. But a large amount is. We need to take the initiative to start eating healthier, exercising, not smoke, ect.
I just don't believe are taxes should go to say a life long smoker who now has developed lung cancer. Or a person who drove drunk and got in to an accident and became paralyzed. Why should my tax dollar go to pay for their health care when their condition is self inflicted?
I am all for helping the helpless. I just think the ones that can help themselves do so instead of acting like they can't.
no subject
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