There’s a not bad description of the different proposals from Bush (what there is of one) and Kerry about health policy from the AMA News this week. It gets it about right on several of the key points, not the least of which is that Kerry’s plan is unlikely to get past the current Congress even if he is elected, but that Bush’s plan does nothing for the uninsured. It also ends with the fact that people are likely to vote about what is best for their health care rather than for the healthcare system as a whole. That’s a sensible point, although (tangent warning!) in the last 24 years the Republicans have managed to get people to favor tax cuts that (for most people) actually hurt themselves while favoring the 2% of the population that earns more than 5 times the national average household income. (OK, OK I know it’s complicated but if you factor in the benefit of mortgage and health insurance tax deductions to high earners, the increase in social security and Medicare taxes over the past 2 decades, and the increase in state taxes and charges for things like education to cover the reduction they are getting from the Federal pie as that gets diverted to paying interest, then it’s true).
Alright. Back on message (I’d never make a Republican, would I?). There are a couple of issues that the article does have wrong. It quotes an administration official in this section:
Bush favors establishing a monetary cap on damages for pain and suffering as part of a larger package of tort reforms that also would ease liability concerns for other industries. “HHS came out with a study that said we waste between $60 billion and $108 billion because of frivolous lawsuits, that this is money going out of the system, not to take care of patients, but to pay off personal injury lawyers,” Hauck said. “The president has a proven, common-sense medical liability reform proposal that has worked in the states.” Campaign officials argue that capping awards will discourage trial lawyers from filing meritless lawsuits that are blamed for driving up liability premiums.
Well unfortunately that number is flat wrong. The $60-108 billion number is from a paper by Mark McLellan (amazingly enough now CMS head) and that’s his estimate of the cost for the “defensive medicine” practiced by doctors who are scared of lawsuits. The actual cost of the lawsuits including settlements is around $4 billion, which is just a rounding error on a $1.5 trillion system. The trial bar-hating Republicans and their fellow-travelers in the AMA argue that if we get rid of the law suits, we’d get rid of the costs. Unfortunately, there are two reasons for defensive medicine. The first and much more minor is the fear of lawsuits. The second is that those in the system who do all the medicine associated with that “dee-fense” gets paid for doing it! There’s no evidence that anyone in the system (especially not AMA members) wants to get paid less, so the chances of actually saving $108 billion are about zilch — it’s a canard.
The other area that requires fisking here is the AHP concept. The article correctly says that:
Bush would like to see association health plans regulated by the federal government instead of the states. His proposals are expected to reach an estimated 2.1 million uninsured Americans at a cost of $90 billion over 10 years. But Bush faces some stiff opposition to his proposals. “Association health plans [are] the only policy that I’ve seen in the history of mankind that uniquely brings together governors, insurers, insurance commissioners, providers and consumers against the policy,” Jennings said. (Jennings was a senior White House health policy adviser during the Clinton administration). Those groups have complained that AHPs would destabilize the insurance market and actually raise premiums.
The issue is that AHPs are usually prevented by state law from cherry picking the best risks. For example in California we have a law that says that if you’ve had health insurance for the previous 6 months you can’t have a pre-existing condition excluded from coverage (you can though pay through the nose to get that coverage, BTW). At the moment an AHP has to obey that law. If Bush has his way, it won’t have to, which will leave the rest of the plans covered by the state law entering that insurance death spiral where the healthy people all bolt for the newly cheap AHP. And of course the additional costs incurred by the plans staying under state law will end up meaning that they rise their premiums — so that the net result may be that we end up with more rather than fewer uninsured. That’s why the current coalition mentioned by Jennings is so opposed to them. However, in any event it’s a modest change in the overall system. Meanwhile the AHPs might as well be called the Any Heist Plan, so frequent is fraud and abuse in them and their predecessors the METs. However, even if they weren’t fraudulent and made health care insurance cheaper, it’s totally disingenuous to say that they’d reduce uninsurance more than marginally. So for Bush to say that he has a commonsense plan for spreading insurance and reducing health care costs is, as you might suspect, another canard. But then again, who’s going to stop him saying it?
On the other hand Jacques Sokolov has a couple of interesting things to say about Kerry’s plan.
“Sen. Kerry believes that there will be significant savings over 10 years in the adoption of these advanced technologies, to the tune of approximately $200 billion,” Dr. Sokolov said. “Many people think those numbers won’t go very far in Congress because they’re unrealistic.”
The same thing applies here as in defensive medicine. That $200 billion is someone’s income and they don’t want it to go away! Sokolov sums it all up by saying:
Both campaigns are offering valid approaches; it just depends on your perspective, Dr. Sokolov said. “If you were an individual who fundamentally believed that there should be less government intervention in health care, you would be very much focused on the President Bush perspective. If you felt you wanted to enfranchise 26 million more people because we don’t have affordable health care in this country, you’d embrace the Kerry proposal,” he said.
In other words, on this like on so much else, we’re a nation divided between a dogmatic supposed “free-market” ideologue and a wishy-washy centrist who wants to use a third-way public-private approach to fix a problem that has only been fixed elsewhere in the world by massive regulation and intervention.
Meanwhile, as for now the recent Bob Blendon article in the NEJM last week showed health care is only fourth on the list of things voters worry about — but it’s just behind terrorism (Iraq and the Economy top the list). So whoever wins and whatever passes, the American health care crisis — high costs and high uninsurance — will make a return visit at the time of the next recession; say in time for the 2012 election?