Matthew Holt

Two rules by which to judge a health reform bill

Right now we have sausage-making going on in DC and lots of uninformed opinions and outright lies being strewn across the front pages and on cable from newly declared experts. I sat in an airport last night and heard 5 Wall Street pundits spewing rubbish about health reform on one cable show. It even included an aging upper-class British twit declaring that government health care was more expensive than private systems. Clearly he’d managed to miss comparing the 8% of GDP his (and my) original homeland spends on health care versus the 17% we spend here. Later on CNN had 4 random people including Christine Hefner—yes one of those Hefners—talking about it. I suspect that if you know something about health care and your name’s not Michael Cannon you’re just not allowed on cable TV.

But all the hot air aside, even those of us in the punditocracy who know something about the subject matter (i.e. anyone reading THCB) seem to be so deep in the weeds that we have lost the basics about what we should be looking for from a health care bill. So it’s time to make that very clear, and here in my not so humble opinion are the rules by which to judge reform.

Rule 1 A health care reform bill needs to guarantee that no
one should find themselves unable to get care simply because they
cannot afford it. Neither should anyone find themselves financially
compromised (or worse) because they have received care.

Rule 2 A health care reform bill needs to limit the amount of
GDP that is going to health care to its current level, with an overall
aim of reducing the share of health care going to GDP.

Everything else (quality, safety, care integration, patient satisfaction, malpractice, primary care, etc) is about rule 7 onwards. Of course a good reform bill would fix all that too. But we have a bought & paid for Congress so we’re not getting that.

Incidentally I just read an interesting biography of Sidney Garfield, the MD who founded Kaiser Permanente. He made the point that once workers were paying into his pre-paid medical plans in southern California and Washington, then patients came in for preventative care that they had been putting off because they couldn’t afford it. Garfield was also—despite years of being accused of being a communist by the AMA—vehemently opposed to socialized medicine and thought pre-paid salaried group practice was the only logical alternative to it, in that it could cover everyone and in the long run do it cheaper because of its emphasis on long-term prevention. And he was more or less right.

Seventy years later the story is the same. We need to get everyone in the system, and figure out how to do it cheaper.

So when you look at the legislation coming out of Congress, it appears to be making a five-eighth's effort at Rule 1.

All of the bills seem to be improving access to freedom from ruinous costs for most people, and increasing costs in a trivial way. So although I’ve said that this reform seems to be trivial and small, it is in its small way potentially going to incrementally improve things.

Sadly it’s ignoring Rule 2, but Rule 1 is more important. Because when we get Rule 1 fixed, Rule 2 will eventually follow.

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DrDaveWhat do the people want?RitaSusanMD as HELL Recent comment authors
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DrDave
Guest

Wow! This thread is a conceptual thicket and regarding economics I usually get lost in the scrub brush! The original Rules #1 & #2 as stated by Matthew are badly misguided, as many have said. Their intentions are admirable, and I would completely agree with them if only softer words like “promote” and “encourage” were used instead of “guarantee” and “limit”. The is the government we are talking about!! Whenever government guarantees or limits goods and services (as opposed to rights and opportunities) there comes hell to pay in terms of rules and restrictions, policies and procedures, violations and punishments,… Read more »

What do the people want?
Guest
What do the people want?

Doctor comment. I wonder what MOST people think about the idea that “fee for service” not being aligned with the pulbic’s interest. How about the patient who is actually sick? Is it really evil that a doctor is financially motivated to be available at that person’s beck and call? Evil that he/she would take risks to purchase equipment to make diagnosis with increased accuracy and convenience? To own and maintain equipment with which to render treatment with increased oversight, convenience, and personal accountability? Would one really rather be faced with a situation where the MD gets a flat fee from… Read more »

Rita
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Rita

Ok–just found this blog as I sought to educate myself a bit on this mess. I will say right now that you are all far more able to address many of what seem to be the larger issues to you and the American Government than I am and I know it-that’s why I went looking for blogs and articles-;) As I listen to all the soundbites and quasi-debate about the American health care system, I am reminded of a few simple facts that are true about my life. 1-My children and I are all covered by Tenncare for which I… Read more »

Susan
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I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
Susan
http://ovarianpain.net

MD as HELL
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MD as HELL

This thread is full of hyperbole. Today we saw apatient I had seen last week, a VA patient who had a huge kidney stone. We got him comrfortable last wek and he wanted to go to the VA. He went to the VA, but he was told it would be 30 days before he could see a urologist. Today we see him back, now dehydrated and in pain again. He is too sick to wait to go to the VA, so the private sector gives him the care he needs, (admission, hydration, lithotripsy,) without question, even though the VA will… Read more »

Hal Horvath
Guest

Ideally the free market would implement rule #2.
We all know this, and why it hasn’t happened: information, decision making, incentives, reimbursement method.
If medicare is reformed over time towards a reimbursement method that is centered on outcomes, then Mayo, Cleveland, Kaiser will all suddenly find their natural advantages matter.

Tom Leith
Guest

MG Says:
> I have been kind of wondering when the various
> physician societies are going to be willing to
> offer a little in order to get a little.
Not that this is easy, but I’ve been saying for awhile now that all they need offer is leadership.
t

MG
Guest
MG

Barry – I agree with you largely on the physicians and their role in reform so far. They are obviously the lynchpin in any reform because they directly & indirectly control so much of healthcare spending but their message so far has largely been – pay me more (e.g., PCPs), tort caps, and let me be. Sorry, that approach hasn’t worked and the old-line, lip-service arguments that the “care in the US” is safe and incredibly-high quality have been completely exposed the last 10-15 years by various health services research in a comprehensive way. You just can’t say anymore that… Read more »

MG
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MG

“How many cycles would it be before a democrat could get elected to national office if Medicare and Medicaid went bankrupt? Throw the insolvency of SS into that and the public might finally realize welfare/socialism/liberalism doesn’t work. It Never has and it never can.” You are a bright guy but you just rant, rant, and rant like a broken ideological record. Who passed the MMA Act of 2003 which was the biggest addition of liabilities to the US Federal ledger sheet since the LBJ administration? As for you rant about SS, wasn’t it Reagen who completely passed the buck on… Read more »

Nate
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Nate

Deron, If COngress passed a bill giving vouchers to the uninsured to buy coverage in the exisiting plans no one would bat an idea. THe problem is reform has NOTHING to do with covering the uninsured. It has NOTHING to do with improving quality of care or lowering cost. If it is simple measures could have been passed 10 years ago to accomplish all that and cost next to nothing. Medicare and Medcaid are unsustainable. They are 2 of the three pillars of liberism and the welfare state. If Democrats don’t find the trillions to sustain them liberalism is dead.… Read more »

Arletha Anderson, M.D.
Guest

We have been begging the Obama administration & our new head of HHS Secretary Sebelius to invite us to the discussion table to lower health care costs. We are still waiting to be contacted. We know you are busy but come on, what will it take to get someone with real world, everyday experience taking care of thousands of the sickest, oldest, and most costly patients to the table? Dr Anderson geriatric specialist is well known for her physician home care program over the past 10 years seeing real patients that reduces costs by 75% and increases quality of care.… Read more »

bev M.D.
Guest
bev M.D.

Agree, again, Deron S.!
One more point I just ran across – there is some interest in giving the recommendation/oversight function to the Institute of Medicine (IOM) instead of creating a new Presidentially appointed board to replace MEDPAC. This idea I like, as IOM is already in place and has some “heft” with the public, given its landmark report on patient safety a few years ago.

Deron S.
Guest

Barry – The $100-$150 billion estimate to cover the uninsured sounds about right. Thanks for putting that out there. To all that support Matthew’s order of priorities, how do you suppose that figure is going to put us over the edge? I hardly think people are going to be rallying in the streets over a figure which has, unfortunately, become “trivial” in these times. Costs will continue to escalate because we will only have taken care of the “feel good” part of reform. The “someone’s bound to get pissed” part of reform will not get sufficiently addressed anytime soon, at… Read more »

Health Remedies
Guest

I think this is quite an interesting posting on some basic principles to judge a health reform bill. I think this would prove to be helpful for many of us.

Barry Carol
Guest
Barry Carol

Bev, Thanks very much for your detailed an excellent response, especially the link to the very informative discussion published in Health Affairs. I agree that the contributions to reform put forth by hospitals, drug companies and insurers are in their self-interest, but they are at least a step in the right direction and are more than they were willing to do in 1993-1994. I also think you are probably right in your suggestion that the doctors will probably need to be dragged kicking and screaming into a new world of reform including a payment model that moves away from fee… Read more »