Health Care Reform in the US

[Hauptman]

According to this 2004 CBO Issue Brief, medical malpractice costs were less than 2% of total health care spending. Their estimate was that commonly called-for reforms could reduce premiums by 25-30% (making a concomittent .4% to .5% reduction in health care costs).

It estimated costs due to "defensive medicine" as "very small."

--Philistine

Thanks for the link; I'll have to read through the report.

Perhaps increases in litigation and malpractice awards have to do with things like this:

http://money.cnn.com/2009/08/18/news...tune/index.htm

(It's scary that they've mostly gotten off without a scratch)

[I_luv_saber]

Does anybody have any numbers on how much tort reform will save us? I acknowledge that it would be a good thing and save money, but I would like to know how much litigation truly adds to our healthcare costs.

I'm reminded of the pharmaceutical companies crying about patent reform because of the supposed high cost of R&D, but then they turned around and spent far more for TV commercials than they do for that R&D. And let's not forget that the price of single-source innovator drugs went up by outrageous amounts when the drug companies realized that they had a captive audience and could essentially charge whatever they liked.

Just in case it was not clear, I'm not pushing for tort reform then leave it alone. Tort reform in conjunction with insurance/pharma regulation is what I'd like to see done before more dramatic steps are taken.

[Inquartata]

First a couple I missed somehow:

That's the key word, and that is how they make their money. Like I said, it's a gamble on the part of the insurance company... they're gambling that you'll never have to cash out, and you are gambling that you will (else that $300 a month was a pointless expenditure).

This whole "gambling" analogy is really rather meaningless, IMO. At this level of analysis one can label every single action any of us take in life as a gamble. Anything at all. And that doesn't lead us to any inevitable conclusions about the morality or propriety of any of those actions...

Also, as was pointed out (but conveniently ignored), insurance companies report a relatively small profit... but this includes funds they never invested, funds from their clients and from the pool.

Still on about this nonsense?

Am I permitted to take liberties of my own with financial and accounting methods to support my points, too? I don't think you really want to go down that road...

If by faith in the Republic, you mean faith that certain Republicans can engage in bald-faced hypocrisy about "Death Panels" for partisan advantage, while assuming no one will fact check their previous support for such just such end of life counselling in the past...

Unfortunately, it isn't even assuming that no one will check their facts. It's assuming that the facts don't matter and that the gullible public will pay no attention to having a claim debunked on factual grounds...

Not but what both sides don't employ this tactic, and rely on the predictable responses of the gullible...

[Inquartata]

For starters, the problem description is not apt. The problem is incredibly complex, but the government doesn't have to "run" the whole thing, unless a single payer + single provider NHS system came into effect. That would be much simpler and less expensive (as shown by the other nations that use such an option), but I don't think that's the answer you were looking for.

It probably would be, strictly on grounds of reducing the number of organs and avenues of control. However, I postulate that in fact it is the plan, or wish, of the current government to "run the whole thing", one way or another. And doing so piecemeal---a regulator here, an agency there---is not going to be either simple or less expensive.

Though I do enjoy the trusting faith that markets are always better and cheaper than government services.

"Ceteris paribus.

if the public option comes into existence, then government just has to be an insurer, not a provider. Which it already is with Medicare - and since you ask, that's bigger and more complicated than any private HMO and runs more cheaply than the private providers.

I do not believe that it does...what evidence is there of this?

Also, you quite left out the "better" part of my question, you know.

I've posted figures to demonstrate that previously, but happily you don't have to "trust me" on this: look at today's NYT business section where a professor of economics states this as a simple fact.

Alas, I didn't read this thread for several days.

I am curious how anyone concludes that Medicare runs better and more cheaply than an equivalent private system which doesn't exist, though.

What we do have is a track record of government running efforts that are infinitely more complicated than private enterprise could ever manage: the Manhattan project. World War II. NASA. Stuff like that.

You mean, other stuff that the private sector never did?

Yeah, government runs the FBI better than the equivalent civilian law enforcement agency, too. Oh, wait...

I strongly suspect that had it been permitted to do so the market could have done better with all of your examples, except perhaps for the administration of military defense, which is a public good. But since we have no examples of it being tasked or allowed to do so, we cannot know. It will not do, however, to assume that it could not possibly have done.

In fact, aren't there already private companies putting satellites into space more cheaply than NASA?

Markets arise where there is an opportunity to make a profit.

Yes...as all of those private contractors that NASA and the military and just about every other government-run enterprise use do.

But when a commercial enterprise buys products from contractors, it usually doesn't end up paying hundreds of dollars for prosaic items like hammers and toilet seats.

I find odd the assumption that the only services a society should have are those in which somebody has figured out how to run a profit at it, regardless of what needs exist - and if nobody figures out how to profit at an activity, then too bad.

If there is sufficient demand, and if it's not a public good, it WILL be produced at a profit.

Have you an example of a legal, normal good or service that "society" wants which is not produced by the market?

That pretty much rules out providing services for the poor, since by definition they don't have the wherewithal to pay for them.

So your alternative is to force others to pay for them instead?

I disagree with you on this. There has been plenty of evidence to show that this is widespread, much of which has been presented here. It is in fact widespread and regularized. That's a fact.

Sorry, that just isn't as clear as you believe. Until we know the number of "wrongful" or "bad faith" transactions compared to the total number of transactions, we cannot know the extent of these practices. That you are convinced of X does not of itself establish X as "a fact". ( And that I doubt X does not mean that it isn't, either---luckily I am not asserting that it isn't a fact, only that we don't know. Someone may, but they don't appear to be telling. )

Really, the evidence is all around you.

And yet, I have never had a claim denied, and I know no one who has. So apparently the evidence all around me is of the invisible variety...

I think it helpful for their to be redress to help individuals in the uneven struggle with mighty corporations. Oh, but they're always benign, right?

Yes, and no. The "yes" is known as "the courts". The no is accompanied by an "alas".

Is government always benign? More often benign than the market? Let's ask the Japanese interned during WWII, or the people blacklisted by the Warren Commission, or the people harassed by Hoover's FBI, or for that matter the field testing of chemical and biological agents on unknowing members of its own military forces. Or---the list is as endless as that of the illegal and immoral acts of corporations, I suspect.

Nope, not me. I like meritocracy just fine, thank you very much. What I argue is that tax policy to help "them that has" to get more is unjust.

See, my problem with this is not necessarily the diagnosis ( sticking with the medical theme ), but rather with the prescription. Which always seems to be something along the lines of "Let's reform the tax codes so that it will take more from THESE guys and give it to THOSE guys, who we deem more deserving". You cannot divorce tax policy changes from the views and opinions of those making the changes.

If you want to argue that the cost of entry for a doc (or anyone else) to open a line of business they aren't already in should be reduced to 0, then go for it.

???

doctors have no reason to avoid costly procedures that raise the cost of healthcare because they in fact do not have to pay for them

Granting for the sake of argument that this were true...the same could be said of Medicare patients, for instance. And yet you still feel that Medicare is a model of efficiency and a well-run system, although it creates demand for services which "cost nothing because the demanders are not paying for them"?

Like going to the auto shop and saying "MY car is making funny noises. Do I need a tune-up, oil change, master cylinder?" Well of course you do, come on in!

Not really like that...unless you are saying that doctors own their patients, and that things done for the patients really benefit only the doctor...

what you are doing is imagining that writing a prescription for a patient to get an MRI somehow adds to those administrative efforts in an extent that is all meaningful.

Hmm. I had a doctor send me off or an echocardiogram last year. I recall some extra paperwork flying back and forth, the receptionist having to arrange it, and the doctor having to read the results and explain them to me, among other things...

All of these things require time. Time is valuable, which is why people are paid for it. I cannot calculate the cost, but I am dubious that it is as minute as you claim, which is to say, that it is equivalent to being nonexistent ( "not cost sensitive" ).

If you want to focus on what really kills staff time for doctor's staff, it's arguing with the HMO to pay for services already rendered, or to argue with HMO staff that a procedure is in fact needed and covered. That's what takes hours and hours of time and expenditure of money.

I believe you!

However, I would argue that a substantial amount of the inefficiencies inherent in these activities result from compliance with past and present regulatory burdens.

Besides this, you've dropped the other example I gave - the first one, I think - in which doctors often use expensive non-reusable kit for no particular reason when a cheaper alternative was equally good.

Have we in fact established the "equally good"part?

And have you calculated all of the relevant costs? As an example, a reusable instrument may cost less than a disposable equivalent---but the latter does not make having an autoclave necessary. ( Do they still use those? ) You have to look not just at fixed costs but variable ones as well...

Uncle Miltie doesn't convince me at all. I think he was completely and tragically wrong in this area.

Well, but you see, that's a bit like me trying to tell a doctor that some particular medical theory is wrong: I am not an expert in his field. I haven't the necessary sorts of knowledge to make me a good judge of whether he is right or wrong, which is why we accept the advice of experts in the first place...

I'm not sympathetic to the "mandatory insurance reduces my freedom" bit either.

I can but shrug and lift my palms. A choice is being forced on me. How is that not a reduced freedom?

I now have less money than before, because I am forced to buy a product that I do not want. How does that not reduce my choices in life?

It's too Braveheart...

I---don't know what that means.

Almost everybody who thinks they're invincible and refuses to get insurance will some day wind up in the ER and expect to be cared for at the expense of everybody else.

It never happened to me. And had I been forced to buy health insurance all those years, the my choices to do other things would have been reduced substantially---all because of something that "might" happen "someday".

[Inquartata]

You are being an ass.

Great, this is your province as moderator, is it? Name-calling?

"It's good to be the king", I guess.

Sorry if this has been repeated, but I read in the paper today that Obama may be willing to drop the government option in favor of a co-op, in the interest of compromise.

Thoughts? (both on his compromising and the plan itself)

He's between a rock and a hard place. Now the left is baying at him for betraying THEIR agenda.

Frankly I think that there is not much difference between a nonprofit outright public option and a nonprofit co-op where the government pays.

And apparently the history of co-ops is pretty spotty...

Maybe whatever plan emerges from Congress should be tested on a small scale for one year before being foisted onto the public in its entirety. I recommend that the test group be composed of members of Congress and the Administration, their staffers, their appointees and the families of all of the above. Give up your present health care and go onto the system you have designed for the rest of us, and see how it works for you first...

"reduce waste" is something anyone can agree to

Yes. And it doesn't require the the wholesale expansion of government intrusion into the private market. Just the rearrangement of incentives and disincentives...

[Inquartata]

The scary part is just how many Americans are filled with this kind of rage and vitriol. Is it just an American phenomenon?

Nah. We don't go on strike and barricade the streets whenever the government talks about reducing our benefits plush pensions or making us work more than 30 hours a week...

And let's not even go into the "rage and vitriol" to be seen in the Arab world.

[Inquartata]

I can not speak for the other European countries with a large exodus to USA in the 19th century, but for Sweden it is instructive to note which kinds of people were over-represented among those that left.

So, then, Australia ought to be---

Never mind.

[Hauptman]

Nah. We don't go on strike and barricade the streets whenever the government talks about reducing our benefits plush pensions or making us work more than 30 hours a week...

And let's not even go into the "rage and vitriol" to be seen in the Arab world.

That's a fair point. Also interesting is the countries that you are referring to have never been big on emigration. Very few French and Arabs in this country, relatively speaking.

[I_luv_saber]

Am I permitted to take liberties of my own with financial and accounting methods to support my points, too? I don't think you really want to go down that road.

Sure, you're free to ignore logical explanations in order to support your points.

[lindajdunn]

But when a commercial enterprise buys products from contractors, it usually doesn't end up paying hundreds of dollars for prosaic items like hammers and toilet seats.

The hammer was for the SR-71 Blackbird, which is Titantium.
The "toilet seat" was a complete toilet for an aircraft (I forget which one).

[lindajdunn]

[quote]Maybe whatever plan emerges from Congress should be tested on a small scale for one year before being foisted onto the public in its entirety. [/quuote]

Maybe some of the states could run programs and we could consider which ones are most suitable. Oh, wait... we're already doing that.

Didn't Romney - a Republican governor - do that in Massachuttes?

And here's a link for my home state's insurance program: http://www.in.gov/fssa/hip/

The HIP plan covers individuals who do not live with a dependent child, and parents who earn up to approximately $44,000 annually for a family of four, have been uninsured for six months and do not have access to insurance through their employer. There is no asset test. HIP may require you to pay a small monthly fee based on the amount of your income. HIP does not cover vision, dental or maternity services.

[Bayou Bum]

[QUOTE=lindajdunn;819117]

Maybe whatever plan emerges from Congress should be tested on a small scale for one year before being foisted onto the public in its entirety. [/quuote]

Maybe some of the states could run programs and we could consider which ones are most suitable. Oh, wait... we're already doing that.

Didn't Romney - a Republican governor - do that in Massachuttes?

And here's a link for my home state's insurance program: http://www.in.gov/fssa/hip/

The HIP plan covers individuals who do not live with a dependent child, and parents who earn up to approximately $44,000 annually for a family of four, have been uninsured for six months and do not have access to insurance through their employer. There is no asset test. HIP may require you to pay a small monthly fee based on the amount of your income. HIP does not cover vision, dental or maternity services.

Then why do we need a federal plan? Let each state adopt their own.

[lindajdunn]

[QUOTE=Bayou Bum;819152]

Then why do we need a federal plan? Let each state adopt their own.

It would be more efficient to have one national plan than to have 50 plans and a national plan would also provide coverage for those who travel.

http://www.realclearpolitics.com/art...orm_97988.html

So far, though, only about a third of states have either enacted or are moving toward comprehensive health care reform. According to the Kaiser Family Foundation, a non-partisan health care think tank, as of last month three states have enacted and begun to implement a health care reform plan that aims to cover nearly all of their residents.

These states are all located in New England: Maine, Massachusetts and Vermont. All three ranked in the top 10 of the Commonwealth Fund's health system performance scorecard, which looks at "access, quality, avoidable hospital use and costs, equity, and healthy lives," according to the report.

Meanwhile, 14 states have proposed or are moving toward comprehensive health care reform, according to Kaiser: California, Oregon, Washington, New Mexico, Colorado, Kansas, Minnesota, Iowa, Illinois, Wisconsin, Pennsylvania, New York, New Jersey and Connecticut. These states have had varying degrees of success in their quest for comprehensive reform.

[Bayou Bum]

[QUOTE=lindajdunn;819165]

It would be more efficient to have one national plan than to have 50 plans and a national plan would also provide coverage for those who travel.

http://www.realclearpolitics.com/art...orm_97988.html

So far, though, only about a third of states have either enacted or are moving toward comprehensive health care reform. According to the Kaiser Family Foundation, a non-partisan health care think tank, as of last month three states have enacted and begun to implement a health care reform plan that aims to cover nearly all of their residents.

These states are all located in New England: Maine, Massachusetts and Vermont. All three ranked in the top 10 of the Commonwealth Fund's health system performance scorecard, which looks at "access, quality, avoidable hospital use and costs, equity, and healthy lives," according to the report.

Meanwhile, 14 states have proposed or are moving toward comprehensive health care reform, according to Kaiser: California, Oregon, Washington, New Mexico, Colorado, Kansas, Minnesota, Iowa, Illinois, Wisconsin, Pennsylvania, New York, New Jersey and Connecticut. These states have had varying degrees of success in their quest for comprehensive reform.

Interesting article, but only more evidence as why it should be left up to the states. So far, your only argument for a federal plan is that it is more efficient and coverage when traveling. I don't see more efficiency but more bureaucracy. Medicare is not very efficient, hence why it is bankrupt, per Obama at town hall in Portsmouth, NH. As for travel, I am sure most state plans allow for care while traveling, just as private plans and the proposed federal plan does.

So, let the states address the issue. In addition to it not being a function of the federal government provided in the Constitution, it will provide competition. States with better plans will attract business which provides jobs and taxes, forcing other states to improve in order to remain competitive.

[Capt. Slo-mo]

The problem with many localized plans though, is the "in-network" vs "out of network" pricing tiers. The difference in reimbursement rates can be staggering.

The same goes for pricing negotiations with Big Pharma and providers. The regional co-op is the mom and pop store. The much larger Public Option is the nationwide SuperMegaMArt store chain. Which one can get better prices from its suppliers?

[lindajdunn]

http://www.pbs.org/nbr/headlines/US_...ion/index.html

One of the most widely accepted arguments against a government medical plan for the middle class is that it would quash competition _ just what private insurers seem to be doing themselves in many parts of the U.S.

Several studies show that in lots of places, one or two companies dominate the market. Critics say monopolistic conditions drive up premiums paid by employers and individuals.

[lindajdunn]

http://www.huffingtonpost.com/2009/0..._n_266589.html

The rapid rise in health insurance premiums has severely strained U.S. families and employers in recent years. This analysis of federal data finds that if premiums for employer-sponsored insurance grow in each state at the projected national rate of increase, then the average premium for family coverage would rise from $12,298 (the 2008 average) to $23,842 by 2020--a 94 percent increase.


Here's another source with a similiar article:

http://www.afscmeinfocenter.org/

Here's the original study:

http://www.commonwealthfund.org/Cont...s-Incomes.aspx

On a personal note: I sometimes wonder how much of an impact the cost of health insurance has upon offshoring.

[prototoast]

http://www.huffingtonpost.com/2009/0..._n_266589.html

The rapid rise in health insurance premiums has severely strained U.S. families and employers in recent years. This analysis of federal data finds that if premiums for employer-sponsored insurance grow in each state at the projected national rate of increase, then the average premium for family coverage would rise from $12,298 (the 2008 average) to $23,842 by 2020--a 94 percent increase.

Health insurance costs will continue to rise until people realize that health insurance is a retarded way to pay for health care.

[I_luv_saber]

In case no one clicked the link and followed it the first time 'round, here is my beef with the profit thing (which Inq is wanting to ignore).

Some insurance companies claim they only make as little as a 3% profit. This is true... sort of. You see they are claiming profit from money they never invested, money from the pool of people who have purchased insurance. Look at it like this.

Say I have to invest $500k per year to run a small insurance company. I have 1,000 clients paying an average of $300 per month. That's $300k per month from all clients, or $3.6 million per year.

Now the companies are reporting their profit from all this money they never put in, plus the money they did put in.

They say 3%... 3% of $4.1 million (the pool of money + investment) (Note: Their investment only making up 12.2% of the pool, which is nearly on par with what they themselves report (Blue Cross is 13.8%)) is $123k (the rest of the money goes to fund payouts for people who "cash out"), which would be pretty meager profit... except that since they only actually invested $500k they are actual getting a return on their investment of 24.6% ($123k is 24.6% of 500k), which is a pretty decent profit (if you take actual numbers such as the article did, their profit can range from 20-50%)

This is working with a low percentage... Blue Cross claims 7.3% profit. When you do the proper breakdown it's actually a 52.9% return on their initial investment. This isn't complicated.

That was the point of that "funny accounting" (in which it seems someone is playing numbers to make it look good, and guess who it is! )

[downunder]

Health insurance for a family is seriously $1000 a month? That's an insane amount of money.

I also saw that the CEO of Whole Foods thinks that people don't have a right to health care. I can't believe people actually think like that.