Health Care Reform: My Two Cents

The FDA may limit how much nicotine can be in cigarettes (here).

My reaction? Finally!

You see, I’ve been thinking a lot about health care. I think it’s a tricky topic as it involves four items that can be mutually-exclusive of each other in a policy debate. Here are the “Big Four” in my book:

  • Coverage
  • Who pays
  • Personal liberty
  • Costs

Health care reform is a tough topic, as it involves tradeoffs among those four major issues. Here’s what I mean.

The ACA is legislation that offers universal coverage through exchanges, the elimination of barring those with pre-existing conditions, and a large expansion of Medicaid…via funds from the wealthy, medical devices companies and the young and the healthy…via three additional taxes and the use of a penalty on those who do not have insurance…and mandates EMRs and the start of measuring outcomes.

So, that’s a mouthful. Even writing it out takes a lot of effort, but that’s my attempt at summarizing it. Here’s an even shorter summary:

  • Coverage: as many as possible
  • Who pays: the wealthy, med. devices companies, the young and healthy
  • Personal liberty: taxes and a penalty for those who don’t have coverage
  • Costs: early attempts to go to outcomes measurements

IMO, the bill optimized for coverage. (In fact, I’ve long surmised that, in exchange for Sen. Ted Kennedy’s crucial endorsement, then-candidate Obama agreed to make a health care bill his #1 priority upon taking office. That was the horse trade. Universal coverage was Kennedy’s big dream, you can’t pay for it without forcing the young/healthy to get insurance, and Obama wasn’t for the private mandate in his debates against HRC. But, I digress.)

Conservatives feel the legislation hits some of their hot buttons:

  • Who pays: those who make good lifestyle choices are subsidizing those who choose to make unhealthy choices; insurance premia for many are skyrocketing
  • Personal liberty: it is government overreach to force people to buy a product they don’t want
  • Costs: “blank checkbook” expansion of Medicaid is unsustainable and fiscally irresponsible

Similarly, the recent GOP attempt at reform received tremendous backlash, with those on the left rallying against a repeal of taxes on the wealthy (who pays) and the projected increases in the number of the uninsured (coverage).

So, yes, we are in a kerfuffle. We are bouncing among the Big Four and unsure as to how to optimize for the whole. What is our #1 priority and how do we make the tradeoffs?

As I’ve blogged before, I’m for universal coverage and a registered Independent. I’m OK with paying more taxes. I’m annoyed but understand that I’ve had to pay significantly more for health care as my premium goes up by a lot each year.

But, I’m here also to write that an “open checkbook” for Medicaid is not sustainable, as both Medicare and Medicaid together are now almost 25% of all Federal government spending (details here).

So, I’d love politicians to consider ways to encourage better health. Stop subsidizing corn crops and impose a corn syrup tax? Yes. Cut the amount of nicotine in cigarettes? Yes. We need to do something, in all honesty.

The best health care system I know of is Singapore’s. Mrs. T. and I lived there for a few years. No, it isn’t the land of personal liberty, but, boy, that system really works. What once a swamp 50 years ago is now a nation with one of highest GDP-per-capita ratios, even higher than in the U.S.

You can read more about Singapore’s system here. But, note that is an amazing set-up: It is both government-run, but, also, forces individuals to take responsibility for their health care and pay for the lion’s share. Health care there is first-rate, and they pay a fraction of what we do (about $2,800 a citizen vs. $9,400 here).

We in the U.S. need to make some tradeoffs. This is a critical time for Presidential leadership, I have to say, to try to articulate a vision that balances trade-offs among the Big Four. And, can anyone in Congress ignore the lobbyists and SuperPACs?

Anyone? Anyone? Bueller?


2 thoughts on “Health Care Reform: My Two Cents

  1. Jo – Great points, as always.
    There are a few other factors you may want to consider:
    1) The cost side – The biggest travesty I saw in the last 8 years of healthcare debate is that no one is trying to drive the costs of products and services down. In fact, we are incenting volume and more complex conditions (to improve reimbursement). It’s no surprise that drug costs have gone up once Medicare Part D was approved (which prevented the government from negotiating with drug companies). So we have the biggest buyer not trying to control costs. This is solvable and should be the source of bi-partisan work.
    2) The cultural component – We believe we’ve got a God-given right to smoke, shoot, and eat pork rinds. The incentives (as you mentioned in your Singapore reference) should be around good behaviors. But we look at forcing good behaviors as the state controlling our lives. This could be solvable (once you get past some genetic testing to understand a pre-disposition towards certain conditions), where people who can improve that actually do improve gain some benefit.
    3) The asymmetric aspect of Healthcare – You are overpaying for healthcare until you need it. Once you need it, you typically get more than you are paying. Unfortunately, it’s not like life insurance where there is one claim at the end. This reality drives a need for single payer or a mandate. After all, if we’re incapacitated in a car accident, we do expect an ambulance to pick us up and take us to the ER; as opposed to choosing who might be able to pay!
    4) The profit motive – One of the flaws in the ACA is that insurance companies are required to spend a certain percentage on medical expenses vs. Admin. So medical efficiencies/savings require offsetting admin cutbacks. As a result, the insurance companies would rather have more medical cost, as opposed to less! This is also a solvable bi-partisan issue.

    Keep up the thoughtful writing!!

    1. Ara, thank you for writing with so many great points! It will be interesting to see where all this goes. Medicare and Medicaid are growing incredibly quickly. Those two and Social Security, a non-means tested benefit, are already over 50% of the Fed. government spending.

Leave a Reply