There are two interesting articles about healthcare in today’s LA Times (which I’m reading as I eat lunch). The first discusses the rise in the cost of employer provided health insurance and health insurance premiums: the net effect of this is that any raise you might see will probably be offset by the increase in your share of your insurance premiums. The second is that fact that primary care doctors admit that they are part of the problem, ordering unnecessary or defensive tests for a variety of reasons.
Were I to mention this to a “tea party conservative”, I’d likely get a rant about Obamacare. However, the Affordable Care Act (which is the real name of what was passed) is not behind the increase, other than some preventative care costs. The ACA does nothing to control healthcare insurance costs; indeed, if the mandate of the act to have every have insurance coverage comes into play, insurance costs (but not medical costs) will get lower simply because the pool of insured is lower. No, you can’t blame this problem on Obama directly*
[*: well, other than he wasn’t forceful enough to get Congress to do the right thing, but the right thing would have had the conservative right complaining more]
A series of recent Planet Moneys give some insight into this problem. First and foremost, our medical insurance system is broken, broken, broken. Trying to fix the problem within the existing system is difficult if not impossible. The Planet Money folks gave a good analogy: Supposed you had employer-provided food. You could go to specific stores, and for a $20 co-pay, get all the food you want. You would consume food without regard for the actual costs. You wouldn’t think twice before ordering the caviar or lobster. You would eat prime beef. As this happens, your employer’s food insurance costs will risk. The insulation from the actual costs of services leads to bad consuming decisions.
Secondly, how we pay doctors is broken. This is illustrated well by the doctors article. They are paid by how many people they see and how many tests they order, not for providing a good service with good outcomes. It is in the doctor’s financial interest to order more tests for a number of reasons: more income, better legal protection, and for enhanced diagnostics when they don’t have time to spend with you.
What’s the answer. One approach is cost containment. In this approach, you need an insurer large enough to dictate basic prices, and you need some gate keeping to have insurance cover only cost-effective and effective procedures. This is what has been termed “death squads” by those looking to kill it, but is really one of the hallmarks of a single payer or government run system. This doesn’t mean that other services are not available, mind you, only that insurance wouldn’t cover them or would only partially cover them. But such an approach goes against a lot of our well-financed special interests: drug companies, health insurance companies, and the medical establishment (who would have dictated rates).
Another approach might be tiered reimbursement. Known cost effective procedures would be reimbursed at one rate, and there would be increased cost sharing for more expensive procedures. This would at least let people know the cost of their services, although it would price some people out of the ability to get life-saving treatments.
Of course, underlying all of the health insurance debate is one question no one ever seems to bring up: What is the value of a human life, and are all human lives valued equally? This depends on who you ask. There are some folks who give the appearance of valuing the life of an unborn child much highter than the life of that same children when they are 25 and on welfare. There are others who value lives differently based on where you are in the social strata, or who your employer is, what you do, or how much you care about that specific individual. Ultimately, although we are loath to admit it, every life has a value. A hard cash value, which represents how much you are willing to spend to save that life.
Perhaps one reason that dealing with the whole health insurance muddle is such a mess is it forces us to face that question… and the answer exposes things we don’t want to admit publically. Your thoughts?
