thoughts on health care ctd.

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Erik Kain

Erik writes about video games at Forbes and politics at Mother Jones. He's the contributor of The League though he hasn't written much here lately. He can be found occasionally composing 140 character cultural analysis on Twitter.

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29 Responses

  1. Avatar Travis
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    says:

    I’m sorry, but how do you know a public option is “doomed to fail?” Conservatives keep repeating these memes as if saying it makes it true.

    Also, about this evil enormous government bureaucracy that would be created – what about the evil enormous insurance company bureaucracy? Every insurance company represents an enormous layer of profit-skimming middlemen whose primary job is figuring out how to make money off you, not how to provide you the health care you need. Whole departments of these companies are devoted to finding ways to terminate the coverage of customers who have become unprofitable. How on Earth does that make sense?

    Why is the government bureaucracy evil and wrong, but the insurance company bureaucracy pure and right?Report

  2. Avatar BCChase
    Ignored
    says:

    I agree in part with Travis: when you say “deregulated insurance industry” what I hear is “an insurance industry with more unscrupulous ways to deny you coverage.” I realize that supposedly market competition would limit that, but here’s the problem for me: the health insurance market is already dominated by a few giant companies. So, the barrier to entry for small companies to compete against them will be pretty high, even if we get off of an employer-based system. And then, the imperfect information barrier means that many Americans will sign on for plans with intense legal and health jargon, not knowing they are being screwed. So, the market forces are thwarted, and what should be a competition to provide the best coverage becomes one to screw people most effectively.

    I have yet to be convinced there is a non-government way to prevent private insurance companies from thwarting the moral imperative of good health care for profit.Report

    • Avatar E.D. Kain in reply to BCChase
      Ignored
      says:

      Two quick thoughts (for now). 1) So the heavily-lobbied government will be better than the market at determining what’s fair, what ought to be covered, etc? (And we shouldn’t forget that courts will also end up making some calls on this…)

      2) Nothing is free, even free health care. The cost will continue to rise and that will become a much more dreadful burden on the economy and standard of living than I think people realize.

      3) Damnit I had another thought and it has vanished. More later….Report

      • Avatar willybobo in reply to E.D. Kain
        Ignored
        says:

        ED, to your points:
        1) Yes, it likely will be, because health care is a volume business and the government will have better investments horizons and better ability to absorb risk than private companies will. Medicare does a better job today, even with all of its problems, than any private insurer does.

        2) This hasn’t been the case in other industrialized nations. They’ve shown that you can manage costs better than we currently do while still improving health outcomes year over year. But even if that’s not the case, it still doesn’t mean that the costs will overwhelm the economy as long as we’re willing to force tradeoffs in other services like national defense. I know that’s unlikely, but it’s not because it has to be true, it’s because we collectively conspire to make it true.Report

      • Avatar BCChase in reply to E.D. Kain
        Ignored
        says:

        My response to 1): Well, yes, the heavily-lobbied government will do a better job. Because even that step removes the profit motive from the coverage decision by 1 degree. Instead of the company making the decision according to what’s best for them, they have to ask the government to please make the decision by what’s best for the company rather than the voter. That may not be a perfect system, and I’m not sure how a government health adjusters will compare in quality to private ones, but to me it is a step in the right direction.

        As to 2): that was not really addressing what I thought was my point: I remain unconvinced that market forces will successfully drive down health insurance in your scheme. For the reasons I stated, and some others people argue below, I think market forces are broken for this industry. So how will deregulating insurance companies really drive down costs? The posts below address some more specific concerns there.Report

  3. Avatar greginak
    Ignored
    says:

    I’m not seeing how a public plan is doomed to fail. Public/ private mixes work in other countries, there is no reason why they could not work here.

    There are already nurse practitioners and PA’s. I not sure where there is another niche to be created. Do other countries have all sorts of niches for professional bone break setters and such? If other countries don’t need them why do we need to create all sorts of new wheels.

    There is nothing in what you mention about how to deal with the basic economics of insurance. People who use a lot of medical care, for whatever reason, are money losers for insurance companies. One chronic illness and an insurance company will never make back the money it spends. Some people have hundreds or thousands of dollars of prescriptions per month. Add in tests, office visits and procedures and you are a money loser. Deregulate all you want but that is one of the basic issues with medical care. No insurance company wants to insure somebody with diabetes or MS or cancer. Dereg doesn’t change that. It is only through group bargaining and plans that insurance companies will take on risky individuals. In the other thread I mentioned my son had heart surgery plus a lot of other care. That was hundreds of thousands of dollars. My premiums would never cover that in even if I paid the company for decades.Report

    • Avatar E.D. Kain in reply to greginak
      Ignored
      says:

      I think that the government needs to step in for those patients through either reinsurance or catastrophic insurance for those who can’t afford such coverage or won’t be covered themselves. I think that cutting checks in these cases will still be cheaper then setting up a huge government program.

      Also, I like the idea of vouchers going toward purchasing group plans or helping people buy into co-ops. This creates the group buying power you were talking about without subsidizing the provider directly (a disincentive to lowering cost as well as constructing a barrier to entry).

      The safety net would still be there. The government would still be in the business of helping people who could not afford to pay. But they would not be in that business front-and-center.Report

      • Avatar Travis in reply to E.D. Kain
        Ignored
        says:

        The problem is that insurance companies will have an incentive to foist their sickest, least profitable patients off on the government’s catastrophic insurance, while keeping only the patients which make them money. It privatizes the profits while socializing the loss.Report

  4. Avatar M.Z.
    Ignored
    says:

    It grows tiresome to see so many conservatives just wing it. When the heck did Wilkinson become an expert on healthcare?

    However, the progressive answer – a public option, alongside “keeping the insurance you have” is an expensive, doomed-to-fail proposition.
    We’ve done it since Medicare and Medicaid were invented. As others have pointed out, there is no reason to believe this is even intuitively true.

    deregulate insurance markets
    This is like saying start a bunch of fires so the big fire won’t have any fuel. From a purely economic perspective, regulations should increase costs of insurance providers. Those costs aren’t driving health care expenditures.

    It seems like we should train people other than doctors to perform certain discrete medical tasks that don’t require all those years of medical school — a mix of pharmacists, professional bone setters, nurse practitioners and others should be able to dole out a lot of routine examinations, procedures and cures at a lower cost.
    This is the proverbial brick in the toilet. $120 office visits are not driving health care costs.

    Now if anyone wants to start discussing how to actually address costs in health care, I’m game. That discussion will involve addressing resources assigned to treating catastrophic disease and illness. That discussion will involve addressing ruinous competition among hospitals. That discussion will involve treating anything costing to the right of the ten-thousands mark as the relatively minor sums they are.Report

  5. Avatar Francis
    Ignored
    says:

    “The only way to really alleviate the drag created by employer-based insurance is to tax those benefits, deregulate insurance markets, and provide means-tested insurance vouchers for low-income Americans. ”

    No — this is your fantasy way of changing the employer-based system.

    Tax Benefits — Political nonstarter. Unions hate it because they have some of the best care around, so the tax would fall on them. Rs hate all taxes.

    Dereg Ins. Mkts — and federalism bites the dust again. You think that the race-to-the-bottom problem of credit cards is bad, wait ’till you see the money that insurers start passing around in South Dakota. There are two reasons health care insurers are heavily regulated: they squeeze their clients just when the coverage is needed, and they go broke. Either way, the State is left with the tab. The State of California has a compelling interest in ensuring that Fly-By-Night Ins. Co. will live up to its obligations when someone with their coverage card shows up in a LA emergency room.

    Means-testing: Just how badly do people need to be humiliated before coverage kicks in? Is this a wealth-based test, so the State gets to inventory every last asset, or an income-based test, so people need to not take certain jobs in order to avoid going over the cap?

    If you haven’t figured it out yet, the follow-on bill in a couple of years will be to dissolve Medicaid and put all of those people in the public plan. They can get sliding-scale support based on their income tax returns.

    0 for 3.Report

  6. Avatar Bill White
    Ignored
    says:

    Medicare eligibility for all. Problem solved.Report

  7. Avatar greginak
    Ignored
    says:

    Kevin Drum has a good post responding to some of Conor’s arguments.
    http://www.motherjones.com/kevin-drum/2009/07/zx#comments

    For one thing he points out that the concern about invation has no data to back it up. While the concern is understandble it is all theory.

    One post makes a good point i hadn’t thought of:

    Let’s test the argument( re: innovation). Controlled experiment: let’s cover one part of the population (those over 65) with universal insurance — heck, make most of it single-payer, with the exception of prescription drugs. Leave the other part of the population (those under 65) to be part of America’s wonderful competitive capitalist medical innovation cornucopia.

    So does anybody still do medical research for conditions that affect the over-65 set? Yes? Hmm, I wonder why that could be. If socialized medicine kills all innovation, then how is it possible that massive research dollars continue to flow to improve medical technology for a population right here in this country that has coverage more “socialized” than any plan to the left of Kucinich’s now proposes?Report

  8. Avatar Michael Drew
    Ignored
    says:

    E.D., June 12, 2008:

    “I think a multi-tiered or multi-faceted approach to health care is the only way forward. Co-ops should be a part of this. They represent a real possibility to increase health insurance coverage for small businesses, the self-employed, and possibly even some lower class citizens if they turn out to be truly competitive. But I think we need a single payer, and probably even socialized option available as well. In fact, the more I’ve thought about this, the more I see a public plan opening a doorway to competition that doesn’t exist in the current system.

    E.D. July 14, 2008:

    “However, the progressive answer – a public option, alongside ‘keeping the insurance you have’ is an expensive, doomed-to-fail proposition. The only way to really alleviate the drag created by employer-based insurance is to tax those benefits, deregulate insurance markets, and provide means-tested insurance vouchers for low-income Americans.”

    But may be missing something, but it seems to me E.D. has travelled from pole to pole in a month. Am I missing something?Report

    • Avatar Michael Drew in reply to Michael Drew
      Ignored
      says:

      Correction: it’s 2009. Duh.Report

    • Avatar Jaybird in reply to Michael Drew
      Ignored
      says:

      In about the space of a week, I went from writing the essay I wrote to realizing that some of the alternatives I gave to prison were atrocities in their own right.

      For my part, I tend to think it’s weird when someone thinks about something for a week and *DOESN’T* change his or her mind about it.Report

      • Avatar E.D. Kain in reply to Jaybird
        Ignored
        says:

        Michael – don’t you know my style yet? I’m bloody manic.

        But here’s the only thing that’s actually changed:

        I still unequivocally believe in universal coverage. I just began to think about the best way to do it more deeply and realized that if you create a state-run system – in our system at least – this would be subject to lobbying from industry groups and would eventually become far less effective and more expensive than we would like to think. However, if we just pay for people who can’t afford insurance we at least allow them to pick and choose to some degree which plan they want, driving competition to some degree and keeping costs down. I just have started to think that the more we involve the feds in anything, the more we end up subsidizing big business and not really helping the consumer/citizen/etc. All the best intentions get twisted and subverted. Look at Waxman-Markey – climate change legislation that has been completely co-opted by special interests to the point it can hardly be called meaningful legislation.

        So my goal hasn’t changed at all. My preferred method to attain that goal has. And believe me, without the assurance of a 100% availability of vouchers for those who can’t afford it, for those “uninsurable” and for unemployed people, I wouldn’t support it. If it came down to a choice between people falling through the nets or supporting a public option, I’d support the public option. I just think there are better ways to do this and avoid big lobbying interests capturing and distorting it.Report

    • Avatar E.D. Kain in reply to Michael Drew
      Ignored
      says:

      I often describe my mode of blogging as that of a drunken madman, so I understand your consternation over my flip-flopping. Thank God I’m not a politician and only a lowly blogger! 😉

      The fact is, I’m persuadable too. But that statement I made a month ago about a public option driving competition – I realize that this could still work. A public option really could, in a perfect world. But in this system, man, everything we do in government seems to benefit big corporate interests far more than they benefit the little guys. And hey, if we really want a public option, why not do as other commenters have suggested and just expand Medicare coverage to a much larger group of people? At least for now? It seems safer, somehow, then starting from scratch even though at first glimpse starting fresh seemed like a good idea….Report

  9. Avatar Kyle
    Ignored
    says:

    Here’s an idea, why don’t we test health care reform. Say in one of the states. We’ll pick a state that’s populous but not too populous, with cities, suburbs, and rural areas. A state with diversity and a reasonably functional state government. Maybe a state like say….Massachusetts

    Let that reform go for a few years, examine it, discuss it, and then figure out if it becomes a socialist hell hole whose denizens have lost their will to live exceptional American gumption or if it looks suspiciously like Canada.

    No, that’s a silly idea. I think we should just reform the system right now, this very month. We can use self-serving statistical models, sob stories from poor Americans and/or European refugees, and helpful ideas and theories from the healthcare industry. After all the political will exists now and why not strike while the iron’s hot. I mean, with a legislative system that lends itself so easily to descriptors like “prudent deliberation” and “quality control,” what could go wrong?

    Too much sarcasm?Report

    • Avatar Jaybird in reply to Kyle
      Ignored
      says:

      If Massachusetts does that, people will abuse the system. Poor people will move there in droves and the rich people there will move away. You’ll have all system users and no one to pay for it.

      This is why you have to do it to the entire country at once.

      Nowhere to move away to. Nowhere to run. Nowhere to hide.Report

  10. Avatar Rob in CT
    Ignored
    says:

    Insurance needs to be regulated. I say this as an employee of an insurer (not health insurance, thankfully).Report

  11. Avatar E.D. Kain
    Ignored
    says:

    I don’t mean to say that all regulations need to be removed when I say “deregulated.” I mean to say that it should be allowed to operate more freely as an industry – across state lines for instance. Not that they should be able to operate without any restrictions at all. That would be a rather odd thing to do given pretty much every industry has some regulations. I see no reason why we’d favor health insurance that much more than any other industry. And probably even more destructive to the operating of insurance than current regulations are the tax subsidies insurance companies receive vis-a-vis employer benefits.Report

  12. Avatar Patrick
    Ignored
    says:

    Why not cut every citizen a check for the same dollar amount? That way, there wouldn’t be any disincentive to make more money, and we solve the other problem with means-testing that MZ points out.

    I don’t like taxing benefits, either. How about just raising the income tax, taxing personal wealth, or instituting a VAT?

    And yes, some deregulation would be in order.

    One other thing that we could do is to allow citizens to keep half of their balance at the end of the year. That is, if you have not spent all of your health-card, but instead have $200 remaining on it, you get to keep $100. This creates an incentive for greater competition on price amongst the healthcare providers and insurance companies.Report

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