Matthew Holt

Senate passes bill, more to come

It’s Christmas Eve and the Senate just passed a major health reform bill. Personally I think the reforms in it are relatively minor, but the passage of the bill itself is a screaming big deal. When I say minor, what I mean is that we’re leaving in place the inefficient employment-based health benefits system, and we’re expanding insurance mostly by putting more people into the separate but equal Medicaid program.

But this bill is a statement, and an important one.

For the first time we’re acknowledging that everyone ought to have health insurance and that those unable to afford it should be subsidized by the government. We’re also saying that insurance companies should take all comers at a consistent price without respect to health condition (and hopefully we’re implying that their job is to manage care not risk-select). Finally we’re saying that the majority of the cost can be paid for by redirecting inefficient spending within the health care system, and by taxing benefits that are only tax-free because of historical accident.

Building on those principles it may be possible to get us to a more equitable and more efficient health care system.

So whether or not you were like me (on balance) in favor of reform, anyone interested in health care should savor the moment. But realize that both after the conference (which will likely end up looking very like the Senate’s version) and the bill’s signing early next year, there’s still a long long way to go in the reform”.

For more takes on the moment see Ezra Klein in the WaPo, Jonathan Cohn in The Treatment and Jonathan Chait in The New Republic.

And for some more fun, Ezra Klein asked a bunch of health care wonks to comment on what they’d like to see added in the Senate/House Conference. I was one of them. (I asked for 1. Freeing Health data, and 2. Making Insurers Responsible for Health outcomes) but you can see links to virtually everyone who commented at the bottom of the last and shortest of the dozen or so letters to Santa which Ezra got.

14 replies »

  1. The current bill does little to improve public health. Until we encourage people to live healthier lives, through a carrot or a stick, we are not going to reduce the cost of health care. Providing universal coverage does not drive down costs. Just look at Massachusetts, my home state.
    Sean Teare
    Aprexis Health Solutions

  2. While the bill, whatever it may entail in detail, may be a marvelous work of litigation, it does not address the problem of health care, at all. It merely drives business to insurance companies and pharmaceutical corporations, and probably tax dollars to the government.
    A REAL solution to the health care problem is as simple as allowing doctors to adhere to the provisions of the Hippocratic Oath, rather than binding them by corporate contracts.

  3. “Build more medical colleges on a masive scale. Prohibit medical litigation.”
    What about the fact that certain treatments for conditions such as cancer can bankrupt a person with health insurance? I agree with you Kern but in addition why do certain supplements when bought in a drug store would cost less than if sold to a hospital from a supplier, such as bandage wrap? The markup is ridiculous.

  4. Real world Pricing that reflects the actual cost of a Operation. The problem I see is the fact that the agreement is between the Insurer and the Provider. So who represents the Patients Interests? Neither of these organizations!
    So how is the patient to demand price Justifications,when neither party is accountable to the patient?Rather, You are held accountable to the Health Insurer and the Provider.
    So, who do you think are the targets
    of this exploitive scam? Yes! It is you and I. Neither of us have any control
    over the pre-arranged agreements that your states Insurance and Commerce, Departments of Health,Medical Boards and our state Legislature’s permits and protects.
    This is a hard cold Fact that allows this industry to feed off the population without justification or accountability.
    So what Options are availible to the Consumer /a lawsuite or Bankruptcy. Either way you are going to pay. Until these organizations are accountable to the Consumer.

  5. The problem with the presidents approach to health care is that he does not recognize the real problem. The exorbitant cost of training health care workers is outrageous! We need to focus on the real issue. Expanding medical training and making it affordable at the root level. Health care workers should graduate with no student debt, period. We need to start the training at the grade school level, progressing on from there. Once the supply of healthcare workers has met or exceeded the levels needed, people can get the care they need at very affordable rates. There is no reason why a doctor cannot function making $50 per hour, or less. Three doctors and 3 nurses, performing surgery should not cost the consumer more than $5000, not $50,000 as is the current rate.
    The other cause of out of control medical costs has to do with litigation. Medical care is a cash cow for attorneys and their mega-mansions. Malpractice lawsuits are killing healthcare and making it completely unaffordable for millions of people. Nothing good comes out of these financial awards to the few people that benefit from it. Their greed is everyone elses curse. If a doctor screws up, send him back to medical school, not sue him into oblivion.
    Summary….Build more medical colleges on a masive scale. Prohibit medical litigation. It’s that simple.

  6. I agree with Game.The U.S itself has complicated the health system.As President Obama said-There is a lot of “waste” in the system. This is the major cause of the high costs. Cutting the waste will not be easy as it will affect many people’s lives.U.S should definitely learn from other developing countries to reduce the costs.

  7. And is it supposed that insurers will absorb the costs of insuring the seriously ill from their vast stores of wealth, or that they will simply raise premiums for everyone? Or have we not got that far in our thinking?

  8. I urge everybody to read Richard Epstein’s critique of the health care reform bill at You don’t have to accept his legal arguments to be very concerned about the potentially adverse economic impact of this legislation.

  9. This is a minor step, but I believe it is a step in the right direction. Whether or not you agree with the reform bill, one thing that is certain is that our current medical model is not as effective as it could be. Also, it will be years before we see the results from positive change due to training needs of licensed professionals and reorganizing the current structure of insurance companies.

  10. I think we have over complicated the medical system in US. People in India / China spend 1 / 10 of what we do on health care yet their service is 80% as good as ours. What we do need is introduce competition in this field. Get more doctors / nurses from overseas, breed more doctor and nurses from US universities, re-evaluate all the red tape that is keeping our cost so high.

  11. “For the first time we’re acknowledging that everyone ought to have health insurance and that those unable to afford it should be subsidized by the government. We’re also saying that insurance companies should take all comers at a consistent price without respect to health condition (and hopefully we’re implying that their job is to manage care not risk-select).”
    I’m not really disagreeing with anything in your post except for the fact that if insurance companies can no longer risk-select, as you put it, its now not insurance. We are simply managing health care rather than insuring something. Insurance is the management of risk, which includes selecting which risk to take. Mostly semantics, but I feel its an important thing to note in this discussion.