Indulging your inner policy wonk.
I was going to ask everybody what their ideal, but realistic healthcare reform proposal would be. The basic point was to show that once we ignored political viability as a constraint on practical proposals, the quality of the proposal (in terms of its ability to make the healthcare system more equitable and just) would improve tremendously. But then, that got me thinking:
1) In what sense is it realistic to ask ourselves what policy we would implement if we were the dictator of America (or alternatively, if we had a magical button that we could push)?
2) Why is it okay to wish away how other politicians and interest groups will respond to a policy proposal and not wish away how people will actually respond to the incentives created by the policy?
I also realised that depending on how we phrased the initial question (i.e. whether we are implementing a healthcare policy de novo for some place like Somalia or whether we are looking at ideal reforms for an existing american system) and to what extent we are considering alternative histories, we have to ask ourselves whether or not it is okay to wish away transitioning problems.
3) When and to what extent is it appropriate to wish away problems with transitioning from the current defective system to ideal one that actually works? To what extent is a policy defective if it requires you or someone similarly minded to manage the transition from one system to another over many years across multiple administrations?
If the above questions bore you or you think that it is in fact not problematic to think of policy solutions merely in terms of their efficacy once implemented without asking if it is likely to be implemented, I have some other questions for you. The answers may be rather long, so you may want to submit the answer as a post or guest post if you think that will be better. Of course, if you think you can provide an adequate answer in the space of a comment section, that is great too. Here are the other questions:
4) What do you see as the root problem that causes the American health care system to fish up so badly?
5) What policy (to the best of your knowledge) solve these problems?
6) How will the policy you propose solve it? (e.g. if it will bend the cost curve, how exactly will it do so?)
7) How do you self-identify politically?
I have my own answers to these questions, and I think the league is fairly familiar with my views especially on the last four questions. I want to hear from the league on this.
P.S. I can’t think of a picture for this post. Anyone got any great ideas?
[Update: img provided thanks to BlaiseP]
How about this image? Melencholia I, by DurerReport
That’ great. Thanks!Report
One: Dictators are efficient. They don’t have to contend with dissidents.
Two: It’s not okay. Even dictators must take the public good into account.
Three: Implementing policy requires ongoing maintenance. The rise time on any signal propagation is not instantaneous. Aiming for an Ideal is pointless: the soundest approach is to solve the most prevalent problems in the least-intrusive manner.
Four: The worst problem faced by American health care is the lack of standardised information storage and transmission, especially in the area of making claims for payment. The HIPAA legislation was a good start but far more could be done. I’ve said it before, ad nauseam, we shall only be able to attack Question Three when we have better statistical information.
The problem is compounded by the fact that physicians and health care specialists are not driving this process. The insurance firms manufacture inefficiencies to delay and deny payments.
Five: we must put the physicians in charge of these reforms. See Answer Four.
Six: Da Vinci tells us when we are confronted by a design problem, consult the natural world for its solution. Medicine, surgery, pharmacology, nursing, every facet of health care would benefit from giving mandate for reform to those who understand the problem.
Seven: Liberal, tending toward Libertarian.Report
1) Obviously it isn’t realistic to ask what we’d Magic Button into existence by definition of the question. However, it can illuminate what the principle is that someone is trying to reach so that the argument can then go to how to get there or if it versus another one is even worth attempting.
2) …that said, admission that all involved have their own self-interests they’re trying to pursue (including politicians) would be even more useful, IMO. Too much political thought conflates personal interest with “The People” even when it’s easily provable there is a conflict. Once you’ve in discussion stated what you *really* want, the dismissal needs to stop to get anywhere.
3) Waving off friction gets terrible pretty quick, especially if you’re actually trying to implement anything. As for having to have True Believers manage over a long time, that shows it to be unrealistic already. I’d go even further though and say that’s a problem with administration as we know it: that single-mindedness is highly unlikely, and even in cases remotely approaching it the result tends towards tyranny.
4) Combination of measures making health care artificially expensive in the first place (medical tech/drug patents, banning the kind of practice described here, the extent to which lower-level specializing is restrained or outright banned, etc) & larger economic structural flaws that keep people from affording it who otherwise would’ve been able to.
Ideally, the measures that make health care more expensive than it would be minus the distortions would simply be done away with. That is what I want, that is the magic button I would push. However, if it is an absolute certainty, as in 100% Will.Not.Happen, and the health care “market” will continue to be distorted as such…fish it, declare it a public good and go to single-payer already, because that’s where it’s going.
5) see what I named in 4, and get rid of those.
6) With the real costs exposed and the ability of average people to afford goods in general elevated, mutual aid should be able to fill the gaps left over. Basically it’ll work because the huge lump of rent-seeking embedded in the system will be cut out.
7) Left-libertarian.Report
4/5) Start by separating insurance from employment. Until you get rid of the distortions caused by that, you’re just tinkering around on the edges.
7) Somewhat left of center, particularly on this issue, and getting more liberal as I age.Report
1) In what sense is it realistic to ask ourselves what policy we would implement if we were the dictator of America (or alternatively, if we had a magical button that we could push)?
To answer the question as written: it’s not at all realistic. But I think you were going to ask what policy Dictator Snarky would impose on the people–and that’s easy. I would create the legal structures, and incentive structures, to create a new kind of “foundation”–an organizational alternative to the profit corporation. I think that the very structure of the corporation so warps human incentives and behavior that it greatly increases the pool of unhappiness and discontent. Among the features I would require:
2) Why is it okay to wish away how other politicians and interest groups will respond to a policy proposal and not wish away how people will actually respond to the incentives created by the policy?
It’s not. When I think of policy, I think primarily in terms of incentives.
3) When and to what extent is it appropriate to wish away problems with transitioning from the current defective system to ideal one that actually works? To what extent is a policy defective if it requires you or someone similarly minded to manage the transition from one system to another over many years across multiple administrations?
I think this is primarily a problem of political culture. Currently, transitioning to policies which make more long-term sense, but could cause political pain to some players–like ending the employer health insurance tradition in the US, or instituting a genuine Keynesian regime, in which surpluses are accumulated in prosperous years–are rendered politically impossible through demagoguery. I don’t think it’s possible to simply wish for a more mature and informed electorate–most people are just bored by politics and policy.
But the current degree of political polarization makes such moves impossible. Were the Democrats to frankly acknowledge, for instance, that MediCare needs to be dramatically changed to be sustainable over the long term, the Republicans would jump in in a way that would attempt to attack them from the left! We’ve seen precisely this happen in many, many Congressional campaigns.
So, anything we could do to improve the political culture–through rules, norms, edicts and laws–would be a huge win for America.
4) What do you see as the root problem that causes the American health care system to fish up so badly?
Its incentive structure. Doctors are incented to overtreat, patients are incented to treat medical care as a lifestyle good, lawyers are incented to polarize and demonize, at the same time that budget shortfalls make us reduce research and public health measures.
5) What policy (to the best of your knowledge) solve these problems?
The quickest path out of that, I think, is to–gasp!–figure out a reasonable medical rationing medical and incentive regime. No reimbursement for flus, earaches, and other minor conditions. Physicians are salaried, and malpractice restricted to gross negligence (other damage to be paid from a common fund). Deep research on comparative medical effectiveness, with no reimbursement for treatments without a significant, measurable clinical advantage.
This can take place in the context of nationalized health care, or not.
6) How will the policy you propose solve it? (e.g. if it will bend the cost curve, how exactly will it do so?)
I do not subscribe to the theory that Americans are particularly over-treated (except, perhaps, for antibiotics). It’s that medical care is overpriced.
In 1960, medicine was about 2% of our GDP. Now it’s 17+%. Why did this happen? The inflation started with MediCare. The structure of MediCare / MediCaid–with fee-for-service, unlimited reimbursement of medical services has clearly warped the market for them.
The market for medical goods and services seems like one in which a hybrid free-market / subsidized system just doesn’t work very well. In any case, the way that we (the US) has established a hybrid market is working very well. A better functioning system will, I think, either have to take it over entirely (a ‘la NHS), or return to a “pure” marketplace. In either case, it will be tricky.
7) How do you self-identify politically?
I self identify as a fusionist wonk–I think there is great wisdom in each of the conservative, liberal and libertarian traditions. But, in the context of this site, I am probably seen more as occupying the liberal wing.Report
Snarky,
Aren’t you worried your 12 to 1 limit on salaries would lead to inefficiencies of wage price controls on labor? In other words, wouldn’t economists warn us that this will lead to less economic efficiency and thus less prosperity?Report
No. It is a not a public policy, just a rule to qualify as an “economic foundation.” I’m not sure you understood what I was proposing.Report
“I do not subscribe to the theory that Americans are particularly over-treated (except, perhaps, for antibiotics). It’s that medical care is overpriced.”
I read something recently that estimates are that a third of our health care costs are due to over treatment and unnecessary treatment. Even if this number is wildly overstated, it indicates a huge potential. The problem arises partly because the delivery of the service and the cost of the service are disconnected. FUBAR.
“In 1960, medicine was about 2% of our GDP. Now it’s 17+%. Why did this happen? The inflation started with MediCare. The structure of MediCare / MediCaid–with fee-for-service, unlimited reimbursement of medical services has clearly warped the market for them. The market for medical goods and services seems like one in which a hybrid free-market / subsidized system just doesn’t work very well. In any case, the way that we (the US) has established a hybrid market is working very well. A better functioning system will, I think, either have to take it over entirely (a ‘la NHS), or return to a “pure” marketplace. In either case, it will be tricky.”
I basically agree. Either right or left are better than the middle.Report
A couple of reactions:
I not sure how meaningful that 30% figure is: does that mean that, in retrospect, 30% of medical treatments turned out to be unwarranted or ineffective? Or that a physician prescribed antibiotics for a viral infection? I’m not sure that there’s much you can do to reduce the “wastage” in either case.
Any time you are providing services to human beings, the ideal of “efficiency” must go out the window. Private industry is no more efficient: I’ve heard that 50% of technical support calls dispense incorrect advice. The practice of medicine is largely investigatory and speculative, and deeply, deeply human.
There are certain parts of that “wastage” you can get at with incentives and public policy. Here’re the only ones I can think of:
1. Comparative research. Research of medical outcomes, and the promulgation of specific standards and protocols for different diseases may help quite a bit in reducing costs (and improving outcomes). Because there is no particular constituency for this, I think it is best addressed by the government (through the NIS, for instance).
2. Change malpractice practices. Physicians do quite a bit of “defensive medicine,” ordering tests and treatments that they think have a very low probability of addressing actual medical issues, just in case of a later lawsuit. I’ve addressed that, as well, above: reserve malpractice suits to cases of gross negligence only, and making compensation for mis-treatment part of standard health insurance (or of a non-adversarial settlement fund).
3. Salary physicians. Without making any particular character imputations, it is clear that fee-for-service reimbursement leads doctors to perform more procedures. Even more pernicious is the practice of doctors owning an interest in the labs that they refer tests to.
4. Continuing medical education. After a doctor graduates from medical school, his main avenue for medical education comes from pharmaceutical reps. This leads to a rather unbalanced understanding of the relative costs and benefits of new drugs and treatments. A few years ago, a doctor prescribed me Vioxx for something minor–when I tried to fill the prescription, it was over $100. I called her and asked if it was really necessary, and she said that Tylenol would be just as good (at $3 total). She was so insulated from the costs of the drugs she was prescribing that she actually had no idea that it was so expensive. (Comparative effectiveness research would have helped here, as well).
Even if the 30% number is completely accurate, I would be shocked if it could ever be reduced by even half. And while a 15% savings is not to be sneezed at, it is very far from the solution for the price of medical services.Report
You familiar with the New Yorker piece on McAllen? It pointed to quite a bit of overutilization and made some comparisons in the amount of Medicare spending and the huge gap that can exist between demographically similar places.
I don’t think it’s all over-utilization, but I do think that’s a pretty significant component of it.Report
Good points all, Snarky.Report
#1-3 are great questions, and is getting at something similar to where I was going here, among other places.
ordinary-gentlemen.com/blog/2012/07/the-non-wonky-institutional-left/#comment-299694
They believe in entanglement, we believe in engagement. They won, so shtt is entangled.
There is a subtle illusion going on. As we transition from a polity functionally operating as citizens mutually engaging with each other to a patron-client model, society as a whole becomes weaker and less adaptive to important extraneous issues.
I think it was Kling or one of the guys from Econlog who made the important point that whoever supports central planning inevitably puts himself in the place of the central planner. That’s a very important transition to be cognizant of as it happens. It certainly is true that a citizen in a republic personally has less power over public resources than the patron in a client-patron model (or something more collectivized than that). But overall, this ignores the important difference between authority and capability. As the patron in a client-patron model acquires more authority, the society that he is a part of has less and less capability.
Therefore, as Murali suggests, for any policy we suggest, it’s important to consider how the policy can be implemented before we consider we consider the consequences of the policy on the assumption that it has been implemented.Report
The simpliest fix is to deport sick people. Sick people are responsible for the overwhelming majority of health-care usage, and if we dumped them abroad we’d see a dramatic decline in US health-care costs along with a surge in the average level of American health and well being. We could just kill the sick people outright, but most Americans would probably think that’s a little too close to eugenics and wouldn’t be comfortable with it.
For those who feel this policy is too extreme, many of the sickest Canadians come to the US voluntarily, and those that don’t are commonly put on icebergs and floated out to sea (Embarkation is typically three days prior to the date Canada sticks on a death certificate, depending on temperatures and sea state). Yet everyone loves Canada’s system.Report
Why stop with merely killing and deporting the sick? The elderly and indigent could be thrust into wood chippers and turned into high-protein dog food. Also hapless Canadians.Report
I would go for that as long as they were screened for prions. I wouldn’t want to risk my pets getting mad __insert_pet__ disease.Report
I disapprove of deporting the sick and the elderly, and further I believe that that sort of thing is inappropriate and uncalled for.
There are far better visuals to be had by shoving them from a helicopter over the ocean.Report
Especially (and I think that this might be important) Canadians.Report
I had a great family physical in Eugene, OR. A Canadian who left Canada to escape working in its system.
“Everyone,” may be overstating the case by at least one person.Report
I understand. But, travelling in Canada, I have had to witness how fond most Canadians are of their health care system; and how baffled they are by ours.Report
That’s because they don’t have to put up with their smelly aunt and crotchety grand parents. They just stand on the edge of the ice and wave goodbye. 🙂Report
True. Canada and the UK tell themselves at least their health care is better than the USA’s. Quite right it’s a point of national pride. There isn’t much else.
“And I grew up in the – in the 70s, when there was, uh – it was – it was a period of, you know, the – the careers advisor used to come to school and – and h – he used to s – get the kids together and say, “Look, I – I advise you to get a career, what can I say? That’s it.” And he took me aside – he said, “Whatcha you want to do, kid? Whatcha you want to do? Tell me, tell me your dreams!” “I want to a space astronaut, go to outer space, discover things that have never been discovered.” He said, “Look, you’re British, so scale it down a bit, all right?” “All right, I want to work in a shoe shop then! Discover shoes that no one’s ever discovered right in the back of the shop on the left.” And he said, “Look, you’re British, so scale it down a bit, all right?” “All right, I want to work in a sewer then. And discover sewage that no one’s ever discovered. And pile it on my head and the come to the surface and sell myself to an art gallery.” He said, “What the fuck have you been smoking, eh? Certainly haven’t been smoking in a bar in California, that’s for certain.”
Cause you can’t! No, no smoking in bars now, and soon, no drinking and no talking!”Report
Quite right it’s a point of national pride. There isn’t much else.
Tom, is this type of cheap shot really necessary? Or even helpful?Report
I brought Eddie Izzard as backup. There’s quite something to what I wrote, you know. You should see what some of my UK friends believe about us, such is the disinformation they’re fed.
Yes, of course it’s helpful because it’s true. And don’t glass house about cheap shots, man. This wasn’t even directed at you, nor even at anyone in America.Report
Eh, you’re lumping the Canadians and the UK together to start with which strongly suggests you know very little about either and the whole comment was just a cheap shot.Report
You could even break the monotony on occasion by shoving one from a helicopter onto the blades of another helicopter over the same ocean.Report
“There are far better visuals to be had by shoving them from a helicopter over the ocean.”
As God is my witness, I thought cancer patients could fly!Report
Here was my health care recommendation, imported from another OP earlier today…
1) I would recommend exploring ways to establish catastrophic care for extremely serious and expensive medical conditions. I would allow people to opt out of this with some very onerous requirements. This would be paid for via payroll taxes unless the fool opted out.
2) I would recommend people buy their own insurance that meets their needs for routine, non catastrophic care. I would choose a high deductible and low premiums and few frills. Others can get low deductibles, high premiums and all the frills they would like. I would allow any company to sell any policy that people will buy as long as the company is honest and has proper reserves.
3). I would encourage experimentation with guaranteed insurability and portability, so that people would not be harmed on their routine care premiums if their health status changed.
4). I would subsidize the poor and elderly and possibly the sickly so that they could purchase the underlying coverage policy and pay their deductibles. Catastrophe coverage would be free or cheap as they do not work much or at all.
I would add choice, competition, experimentation and all that wherever possible, and if this doesn’t work, I would just follow Singapore’s model.
But then you mess it up with all the tough questions….Report
4) What do you see as the root problem that causes the American health care system to fish up so badly?
I see the problems as A) a disconnect between the person paying and the one receiving the benefit. This is absolutely guaranteed to screw up costs. Economics 101. B) The combination of a market perverted with a transfer program. By combining them we are perverting both. And C) excessive use of top own master planning for something that should be deregulated and decentralized.
5) What policy (to the best of your knowledge) solve these problems?
See above recommendation. My recommendation solves all three perversions.
6) How will the policy you propose solve it? (e.g. if it will bend the cost curve, how exactly will it do so?)
It would reduce premiums by 43.679 % over the first 3 years and six months and would reduce the level of uninsured to exactly two. Donald Trump and the guy that stole my bike in sixth grade.
7) How do you self-identify politically? Jedi DruidReport