Palin’s health care sense on target

Alaska’s Sarah Palin, who is running for vice president with Sen. John McCain, has better health care policy sense than Sen. Barack Obama and his running mate, Sen. Joe Biden.

Palin has pushed for less regulation of health care providers and more competition, while Obama and Biden are pushing for socialized medicine and ultimately a single-payer plan patterned after the failed systems in Canada and the U.K.

Her approach, which is described here by the Washington Post, is supported by many physicians and advocates of a pro-competition approach to health care and health insurance market reforms, and it will be opposed by executives and employees of entrenched hospitals and local health care monopolies and ologopolies who don’t want to lose business to independent clinics and specialty hospitals.

At Modern Healthcare, where I was editor for 10 years and at Health
Care Strategic Management, which I owned and edited for almost 19
years, I wrote editorials against certificates of need, which are used
by entrenched hospitals to keep entrepreneurs, including members of
their medical staffs, from entering their markets.

While clinics and specialty hospitals cherry pick profitable
business from hospitals, that’s a good thing, not a bad one as hospital
executives would have you believe. More competition gives patients
better quality and more convenient services. Whether increased
competition lowers or raises prices isn’t the point as long as
employers and other third-party payers pay most of the cost, making
patients price insensitive.

Take employers and other third parties out of the markets, and increased provider competition would drop prices substantially.

29 replies »

  1. I don’t know if saying the Republican party doesn’t care about the issue is fully correct…but at the same time, I can kinda see the angle you are coming from also.

  2. That last post should read “the Republican party really DOESN’T CARE about the issue but is just making up rhetoric since the issue has been forced.

  3. I’m a staunch social conservative who has only voted Republican in my 39 years.
    With that said, I think McCain/Palin’s health care is a pipe dream. I also don’t think the Republican party really cares about the issue but is just making up rhetoric since the issue has been forced.
    On what grounds do you classify the health systems of Canada and the U.K. as failures and the U.S. a success? Because rich people can get the best care in the world in the U.S.? That’s great, but it leaves out the rest of us, in particular the self employed, who avoid the doctor except for emergencies to insure that the corrupt insurance industry does not cancel our policy or price it out of our range.
    Are our tax dollars better spent on funding our massive completely out of proportion to the rest of the universe military? Accidentally invading Iraq and dropping hundreds of billions of dollars into an uninvited occupation?
    The Republican party has lost my support.

  4. Good one Gary. What everyone should remember is that when the tax payer has absorbed all the bad loans from Fanny & Freddie and spent billions “stabilizing” the market, these companies will be sold at fire sale prices back to the private sector. The argument of course will be that the private market is best able to manage these companies efficiently. HA!!

  5. Our current market-based insurance system is, by definition, more focused on maximizing profit that taking care of the patient. This is why they work so hard to deny benefits, even after years of accepting our premium payments. Since insurance is about spreading the risk, a REAL patient oriented insurance system would cover everyone, and simply require everyone to pay an equal portion of the total bill. Such a system could only be administered by government.

  6. Some comments about Sara Palin that make me doubt that sehe has ever really thought as deeply abouut health care.
    “..how is she at actually governing? Here’s Anchorage Daily News reporter Gregg Erickson:
    It is clear that she has not paid much attention to the nitty-gritty unglamorous work of government, of gaining consensus, and making difficult compromises. She seems to be of the view that politics should be all rather simple….The Republican chair of the Alaska State House Finance budget subcommittee on Heath and Medicaid says he can’t find anyone in Palin’s executive office who cares about helping bring that budget under control. He is furious with her about that.
    That would be Republican Mike Hawker, who confirms his opinion of Palin to the LA Times:
    “Her administration had the appearance of paying absolutely no attention to any of the rest of the unglamorous side of government,” said Hawker, “whether it be dealing with human services, public services, highways, all the routine aspects.”
    And Democrats agree! Here’s state senator Hollis French:
    French faulted Palin for not helping the Legislature pass a bill to raise the benefits threshhold for children and pregnant women from 175% of the poverty level to 200%. (Most states set them at 200% to 250%.) “She said she wanted to help us raise it,” French said, “but couldn’t be bothered to do anything in the closing days of the Legislature, when she could have helped it through.”
    So in addition to not having much curiosity or interest in political affairs outside of Alaska, she apparently doesn’t have much curiosity or interest in political affairs inside Alaska either
    source: http://www.motherjones.com/kevin-drum/2008/08/palins_governing_style.html#comments

  7. What’s next, equal time for the proponents of the flat earth theory? There is little uncertainty over the fact that the US health care is infected with greed and self-interest at every level, and that market-based solutions have not contributed to better care for all of our nation’s citizens but have instead produced the most unequal, wasteful and inefficient health care system in the world. Why are we even debating this?

  8. Mr. Johnson, where is the failure in covering all of one’s people, not just the rich? Where is the failure in countries whose citizens have longer lifespans than Americans? Where is the failure in lower rates of infant mortality? And where is the success in a United States that ranks among the LEAST SUCCESSFUL countries in the world on just about any measure of public health you care to name?
    Your position would be laughable, Sir, were it not so callous and immoral.

  9. @Ben Toth: Extremely well said.
    @many: Can we please stop calling public health systems ‘socialized medicine’? These Red Menace scare tactics are long past their due date.

  10. I have to say that I totally disagree with this premise of competition bringing better health care, let alone reducing costs. It’s already been proven in cities with multiple hospitals that when each facility tries to top the other by adding the same services, someone’s not going to survive, and the insurance companies won’t even try to support more than one specialty in the area, especially the Blues.
    Whereas I don’t totally support the idea of socialized medicine (I recognize major issues with it for the U.S.), I will say that America needs to find more cost effective ways to take care of those people who can’t afford paying the regular cost of health care. FQHC’s could shoulder it all if supported properly by both Federal and State governments, and has been proven viable in a number of communities across the country.

  11. “Dow up 290 on Fannie, Freddie takeovers
    Investors cheer the Treasury Department’s plan to take control of the battered mortgage companies.”
    Wow! Imagine Wall Street cheering a government takeover – I wonder why. How does this fit with McCain/Palin (or is it Palin/McCain) less government platform? Get that nasty government out of our lives.

  12. Ugh. This is the problem with idealogue like Palin. They stick with a solution that in theory sounds good yet in practical application fails miserably because anyone with any inkling of knowledge knows that just increasing excess supply (e.g., beds) in health care always drive up utilization which in turns radically increases prices.
    If Palin was serious about bringing in “competition” in healthcare on the provider-side, she would advocate giving the FTC real power to bust up anti-monopolist provider mergers in local markets which have really only helped drive up prices or refusing to kow-tow to physician organizations that requires on a myriad of bogus licensure restrictions/requirements on ancillary healthcare providers such as NPs and others.
    Mel Brooks said it best, “Do you know why evil (in this case dramatically increasing healthcare costs) wins, because good (Palin’s legislative reform) is dumb.”

  13. Writing too quickly again.
    I should have said, “CONs may be used to prevent adding to the capacity…”
    By the way, as a grammatical matter it seems wrong to give the plural of CON as CONs. Anyone know of an alternative, other than writing it out?

  14. I’m surprised no one has mentioned Wennberg yet.
    The evidence is that the more supply there is of health care providers (physicians, hospitals, imaging centers, etc.), the more utilization there is. Supply is one of the largest drivers of demand.
    CONs may sometimes be used to prevent useful competition in just the way Mr. Johson says. They may also be used to prevent stronger health systems from building new facilities near (financially) weaker existing ones and bleeding them to death, whereapon they raise prices to pay for the newer, more expensive services and because their greater size gives them better negotiating leverage with managed care companies. And, most of all, CONs may be used to simply add to the capacity in an area without making anyone go out of business or get leaner and cheaper. Instead, the heightened competition incites hospitals to compete in the best way they know: by loading up on newer facilities, cutting-edge treatments and the other expensive technologies that drive our costs higher without improving health outcomes for the population.
    His focus on the case of clinics and specialty hospitals (mostly physician-owned) to the exclusion of all other cases is instructive about his own ideology. It is not instructive as useful policy.
    Mr. Johnson is presenting a piece of ideology and wants us to act on it as though it were science. That is, as though we could use it to make predictions of how things will be. But for that to be true, it would have to conform to the evidence.

  15. If we could harness all of the energy behind the blame and frustration over our healthcare system, we could reduce our dependence on foreign oil. This is precisely why we’re in this mess. We have become a bunch of selfish, socially-irresponsible, no-it-alls who are content to sling blame without offering any real solutions. If we allow the government to take a bigger responsibility for healthcare than it already has, then shame on us. Who is this “market” that all of you want to blame? Let me answer that, IT’S YOU.
    Stop ranting about how bad things are while you eat your cheeseburger and drive your 10 mpg SUV. We need to get the players (physician, insurance companies, patients, employers, etc.) together a dissect this system of ours to find out what needs changed. If we don’t take a system-wide approach, the selfishness will continue to prevail.

  16. Health insurance horror stories don’t make the news much anymore because everyone’s numb to them by now.
    So your theory is that we need more of same: health care that’s market-driven, but more so.
    Maybe it will start to work around the same time that its more general framework of “trickle down economics” in its various guises kicks in and that whole rich/poor gap starts to shrink instead of expand. We just need to give it more time.
    At least as a theory, anybody can see it’s rock solid – just common sense, really: deregulate the economy like we’ve been doing increasingly for the past thirty years, allow the rich to be restrained by nothing but good conscience, and the best interests of humanity will be served.
    The best of all possible worlds… We’re nearly there!

  17. Good post Greg. I wonder if Palin’s church could heal little Emily Demko and remove the crushing health bills from her family with a cell phone healing? I also want to know if Palin’s church and its(hers) minister will receive as much attention, with video, from the media as Obama’s church and Rev. Wright. Somehow I don’t think so.

  18. Palin: “We will allow competition,” she said. “Alaskans want health care in the hands of doctors, not lobbyists and lawyers.”
    I don’t want lobbyists and lawyers interfering in my health care, but should it really be “in the hands of doctors”? Isn’t there someone more important, more crucial to this debate?
    Oh, right… it’s me. The patient. The consumer. The citizen. I certainly need the doctors’ help, but I don’t want my health care in their hands alone. And if you want competition, don’t look to doctors for that. The AMA has plenty of lawyers and lobbyists making sure they get a big slice of the pie.

  19. I was born and raised in a heavily industrialized european democracy …. after moving here for family reasons, I was amazed about the strong beliefs held by a lot of Americans, not only religious beliefs, but unshaken trust in the power of the free market.
    Mr. Johnson apparently thinks that all what you have to do to fix the health care mess is to foster competition and to “Take employers and other third parties out of the markets”.
    Most of us know that medical treatment for certain conditions (e.g. cancer treatment, severe trauma, multiple sclerosis) can become as affordable as having a private jet. But just due to increased competition, you could have the private jet at the cost of a middle class car? All you need to do is drop all these monopolies and FAA regulations … every sane person having an idea of how much technology and highly trained and paid expertise is involved in healthcare knows that the magic wand of the free market is not going to make health care affordable without 3rd party payors … at least not for the middle class.

  20. I wonder if Palin would like to give us her opinion, no tele-prompter please, of the recent collapse of Fanny Mae and Freddy Mac. Is that the kind of unregulated, free market success that she envisions for healthcare? And why is not her solution to the mortgage mess the free market – why is it the GOVERNMENT?

  21. Maybe the free market approach will be as successful with health care as it has with mortgages and energy!

  22. Don
    I’m not sure what you mean by the failed system in the UK. It’s less failed than the US system.
    The NHS provides decent and often world class health care for everyone in the UK at a fraction of the per capita cost of the US system. For historic and other reasons it wouldn’t be possible to transplant the NHS approach to the US. But you won’t get any closer to improving the US system, which is widely regarded as being in poor shape overall, by taking a myopic and partial view of other approaches.

  23. No matter what you read into Palin’s views, they won’t count. McCain is creature of the same financial backers, lobbyists, and policies as the Bush administration. The concept that either one of them will be an agent of change, particularly in health care, seems a difficult argument to support.

  24. Then perhaps you can proffer the case for free market solutions, and its ample successes (LOL) to restrain health care costs, promote the health care value proposition, and solve the massive failure of the cratering employer sponsored health care system, not too mention the its breatheren underfunded and failing government health care systems.
    As always, the devil is in the details and her sound byte oversimplified, subtext embedded, reference to health care reform issues, is hardly a basis for reasoned thought, let alone rational debate.
    So go ahead and list them. Then we can assess the materiality of the claims, and judge them on their merits of lack of same.
    Health care is not like other industries. It does not and will not perform equitably in an unbridled open market system. The Swiss, Germans, French and even Canadian systems are worthy of study, not knee jerk ridicule with mind numbing “socialized or government run” dismissals circa the “Harry and Louise 1.0 Campaign”.
    The free market, aka “managed care” or “managed competition”, has been nothing but a cost shifting charade, with medical or resource management window dressing. The Ellwood Supermed scenario, where some competitive legitimacy could have played out and potentially bolstered your claim, was abandoned a long time ago.