Universal Healthcare

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Ok, this is starting to feel a little absurd. How come other OECD countries can have a more inclusive healthcare system at comparable (even if slightly lower - and that is debatable) level for notably less percent of their GDP, and the US one needs to spend still more? I do not know if there is any newer data than the 2007 OECD records - a graph is available at http://www.oecd.org/dataoecd/46/2/38980580.pdf - but chances are things are fairly similar. It is a fairly illustrative fact that the US system, which does not cover a notable percent of the population, costs its country more in absolute and relative terms than that of France - a country which covers pretty much anyone who legally resides there. We are not talking about a few dollars put in here and there - the difference itself is larger than, say, the percentage of the GDP that goes to the military (5% vs 4.3%) . You'd think this would be something that is discussed every time someone talks about costs, wouldn't you?

There's something rotten, and it's much closer to Washington DC than Denmark.

Oh, and yes, I know I have brought this point up before. However, it darn well bears repeating - the a system can be made both more inclusive and cheaper than what the US nowaday has, and that does not mean that quality will suffer a catastrophic drop.

 

I agree Aldeth. I think the administration is aiming for a Rolls when we can only afford a Chevy. IMO, there are really only a few items that must be done, the rest should be delayed until the economy is back on track (the legions of unemployed will make funding much more difficult):

1. Shore up medicare/medicaid.
2. Ensure health care for children.
3. Limit charges to the uninsured by only allowing medicare maximums on billing.
4. Provide a means for hospitals to be reimbursed when patients cannot even afford the reduced charges.
5. Provide significant tax incentives for pro bono work by the health care industry (this may cover item 4).

I also believe there needs to be a national database of health care professionals (co-maintained by the insurance companies, hospitals and the AMA) which keeps track of inept performance (malpractice) -- such a database will allow insurers to refuse payment to substandard doctors (thereby not allowing their customers to use questionable doctors), hospitals to adequately screen doctors, and the AMA to take disciplinary action against dregs of the community.

 

As it turns out, The Senate Health Committe just passed a bill.

If this is the one that goes through, it will raise taxes on people making over $280,000 - including a sizeable 5.4% increase if federal income tax on those making over $1 million.

 

I'm sure any estimate that Congress and/or the Administration come up with as to cost needs to be tripled (at the bare minimum).

 

Oh, yes. Americans already spend more than anyone else for health care and we are still a ways down from the top regarding quality of care. We spend more for less. The system will not be reformed until there is a government option. A government option will be cheaper than what we are paying now, which is why it may not pass, because there is so much money at stake.

Those who say it is too expensive to have a government option don't understand that they are already paying the cruelest tax of all, one that is built into the cost of all goods and services bought and sold in the US. Or do they really believe that business supplies all their health care plans out of the goodness of their hearts? The cost of all health insurance is passed on to every consumer in the US already as "the cost of doing business" and in profits for the insurance companies.

Nevertheless, there will be a lot of Democratic politicians who will not be reelected if this reform doesn't get done.

 

I admit to not having done any research or fact finding, but this just doesn't make any sense to me. If the government takes over all health care then logically most employers would drop health care as an employee benefit. So the government will end up providing health insurance not just for the uninsured, but probably for everyone. Are you implying that now that employers are not shouldering the burden of the expense that the price of goods would go down? To me this seems like the "corporate welfare" that I see disparaged all the time. Then to top it off, only the uber-rich are going to be taxed to pay for this.

To summarize, my paycheck will increase (because I won't be responsible for my share of the health insurance), the price of goods will decrease, and the quality of care will remain the same or better (There better not be any rationing or long waits for care). If this is the situation then I'm on board. My only problem is that I have never had any faith in government's abilty to do anything correct.

Hopefully, the Uber-rich have enough money to pay for all of this, as I'm pretty sure if the cost starts pressing down to the rich and then the wealthy, and then to the modestly wealthy, and then to the upper middle class, and then to the middle class, etc. it will turn ugly pretty quick.

 

Considering this is the figure that was released by the health committee, and not the finance committee, you may be right. However, even if it was released by the finance committee, it would probably be a low ball estimate. Cost overruns on government programs are almost guaranteed. As a government contractor, I see why. For starters, most of the calculations are done in base year dollars. That means that if a program is scheduled for 10 years, they pretend everything over the course of that 10 year period will cost the same thing as they cost at program initiation. By not factoring in inflation, you are guaranteed to be low in the estimate.

Secondly, when the government releases their Request for Proposal to contractors, they typically only include the bare minimum specifications for what they hope the program/weapon system/whatever needs to accomplish. The contractor gives a price back based on those specifications. Then, when they start the work, the government typically comes back and says, while we only NEED the program to accomplish A, B, and C, we'd also like if it's possible to include D and E. It usually is possible, but the thing is, the contractor didn't include D and E in their original estimate, and so the price goes up.

The only way I think that will happen is if people actually LIKE the government program. Most people in the US have health care insurance, and I think a fairly large percentage of those insured are happy with their coverage. It is human nature that if you are happy with what you have that you won't switch to an unknown. I know I won't be switching to the government program any time soon, and I think a lot of people would agree with that sentiment.

This will result in two things: 1) The vast majoirty of people on the government program at first will be those who presently don't have health insurance, and those people who receive poor health insurance (or no insurance as is often the case with part-time employees) from their employer. 2) There will be pressure (at least at first) by employees on their employer to maintain their coverage, because they'd rather stick with the devil they know.

Now, if some years from now people see that their contribution to their employer-provided health insurance is about the same cost as a government plan, and that the people on the government's plan are receiving adequate service, then people will start opting into the government plan. It's at that point that employers will stop offering insurance.

It won't be me who will be shedding any tears for the wealthy. The proposed plan is for a progressive tax that will kick in for people making $280,000 per year or more. It increases all the way up to an additional 5.4% (which is big) for people making over $1 million per year.

As to your question regarding employers, if their costs of doing business goes down, even if they don't reduce their prices, at the very least it should increase their profit margins. So there's more money for someone. I would predict one of three options, either singlularly or in combination: 1) lower prices for goods and services 2) increased salary for workers or 3) higher dividends on stock due to the higher profit margins.

In a utopian world, that's how it would work. In the real world, the extra you make in your paycheck would likely go to pay for government provided insurance, and you may or may not get the same quality of care (they say thier will be multiple types of plans offered, so depending on the plan you picked, it's entirely possible for you to get more or less than what you had from your employer). As to whether or not the government will do any of this right, I have no idea. They have done big things before. While Social Security needs reform badly, the government handled that massive program for about 70 years now, and every single year SS has taken in more funds than it has paid out - so I'd say that historically, SS has been run pretty well.

In the proposal released by the health committee yesterday, it did hit the rich. (Although I'm not sure I'd consider someone making $280,000 per year uber-rich, or even rich. They are very comfortable, a quarter million per year would place them as either upper-middle or upper class depending where in the country they lived. You're upper class if you're making that money in Witchita, not so much in LA.) Another thing in the proposal was that anyone whose salary was within 4X poverty level would actually receive government assistance to help pay for a government plan. In the example cited in the article I posted, any family of four who made less than $88,000 would get help, and I imagine a TON of families would qualify for this. Certainly any family with blue collar workers are likely making under $88,000 per year.

 

The thing I don't really trust, and don't really believe, is the prices going down bit. Sure, the companies have less overhead, so they don't need to charge as much for their goods, but they know they can charge that much for their goods, so they probably still will.

As for the cost of medicine in the US, I also suspect a good bit of it is the technology and such. MRIs, CATs, PETs, X-Rays, all kinds of drugs, and now they're working on robotic surgory with laser scalpels (seriously, it's in development)? That's all gotta cost a pretty penny, and guess where that cost goes? I'll also tell you all that they aren't at all cautious with these things. My father recently went into the hospital with abdominal pain recently. He has a history of diverticulitis, which he was suffering from when it suddenly flared up. The doctors were pretty sure that's all it was, but just to rule out apendicitis, they gave him an MRI. Now, I'm not complaining, but that's pricey for something that, I'm sure, they were able to differentiate between before they had MRIs.

 

Certainly, there are some very well equipped hospitals in the US. However, is the equipment in the US THAT much more expensive to account for such a significant difference, or at least a large portion of it? I think that is simply unlikely, even considering that according to some studies the US has higher prices for most prescription medication. Also, note that iirc the US is actually behind most OECD countries in terms of number of doctors and hospital beds per 100000 people (it is around the top for nurses though), so I think we can also rule out the idea that there are that much more people or hospitals that drive prices up.

BTW, I came across an article (http://krugman.blogs.nytimes.com/2009/07/06/administrative-costs/) by Paul Krugman in the NYT which states that according to the CBO, Medicare Advantage plans (private) spend around 11% of their money on administrative plans, compared to 2% for the public plans. Both plans are for senior citizens, so they have similar client pools. If you add in the whole matter of private companies trying to make a profit, the difference rises further. Ironic, isn't it, that it may be the private insurers who are more in need of reform than the public plan ?

Edit: the material that he quotes is a study available at http://institute.ourfuture.org/files/Jacob_Hacker_Public_Plan_Choice.pdf

 

Actually, I'd expect the number of hospital beds would drive prices in the US higher: supply and demand and all. Drugs may also play a large role in things, but I blame the phareceutical companies for that, not insurance or doctors (unless they're overprescripting). As for cost of equipment, it may well cost more in the US. I've generally gotten the impression that cost of living is higher in the US than pretty much anywhere else (though it varies wildly here). With that come increased costs for technicians, maintinance personel, parts, shipping, even electricity to run the machines in some cases.

One thing I've heard which confuses me is the claim that the Universal Health Care plan will actually lower medical costs. How would that work? It seems to me that such a plan could only redistribute the costs (i.e. who ends up paying) as opposed to actually lowering costs. Unless they either reduce the number of procedures (at the cost of patient health) or mandate costs for procedures even lower than current insurance (good bye cooperating doctors), I don't see how this could impact the final costs at all. Can anyone help me out?

 

I'm not sure living costs in the US are that much higher than, say, the UK or France. I remember seeing a list of the world's most expensive cities, and, well, it is far from US-dominated - you can see it at http://www.citymayors.com/features/cost_survey.html .Keep in mind the list is made with regards to the dollar, not the local currency, but even then the discrepancy probably won't account for all that. I am not quite sure how reliable these are, but "most expensive country" lists tend to show the US after #10. Again, costs are no doubt high, but imo not that high (you might find this article interesting).

The medical costs themselves? I am not sure where such information was given. A public plan can reduce the administrative costs and all but eliminate the amount that private insurers take as their own profit, but as for the medical costs themselves... I can see it working if it is large enough to be able to negotiate preferred deals with the pharmaceutical companies (American or foreign ones) or other external entities via corporatist negotiations; with the addition of the already public elements in healthcare (Medicare, Medicaid, possibly the VA program) it would most likely have a fair bit of influence. Also, I suppose a national medical database would lower the cost of treatment by reducing cases of mistreatment (which, apart from all the moral and medical issues, often leads to complications and thus longer and thus more expenses). There may be other benefits, but I can not think of any. Mind you, both of these are technically feasible for private insurers as well.

 

Wow, that really surprised me, Shaman. I figured Honolulu would be much higher on the list. I'm also more than a little surprised that Moscow ranked so high. Good find there.

Well, I'm not at all sure that the lower cost claim was actually made by Obama, or just someone advocating this plan, but I heard it a couple of times. Once was the Daily Show, which is usually pretty obvious about which claims are jokes and which aren't, and I don't remember the other places I heard it.

 

Moscow is a bit of a weird case from what I hear. Some neighborhoods are fairly affordable by Western standards, if not downright cheap - especially for the Russians who know where to shop, what to buy etc. However, it also has some insanely expensive neighborhoods, where the richest Russians and foreigners live. I have heard some insane things about the lifestyle of the Russian oligarchs... if half of them are true I definitely can believe Moscow is one of the most expensive (if not THE most expensive) cities on the planet.

 

The thinking is that previously-uninsured people would go to a doctor earlier to get something looked at, and not wait until it was a very serious condition and need to go the the emergency room to get it taken care of. As an example, say you get some swelling in your leg - it hurts a bit, but you don't think much of it and since you don't have insurance, you decide against going to the doctor. A month later, it turns out the swelling was caused by a blood clot, and you're being rushed to the emergency room with a heart attack. A $20 presciption of coumadin could have prevented a $10000+ emergency procedure.

The thinking is that if you had health insurance, you would have gone to the doctor and got the prescription. Granted, if the uninsured person KNEW that he had the blood clot and was risking a heart attack by not going he would eat the costs and get to the doctor. However, under the current system, chances are that uninsured person is not paying his bill. Chances are that uninsured person cannot afford to pay that bill, because if he had that kind of money lying around, he'd have medical insurance. So how does the health industry make up those costs? By charging higher premiums to people like you and me who do carry insurance.

So the thought behind lowering costs is twofold: 1) By more people getting preventative care and getting problems addressed early, you can avoid some far more expensive treatment down the road and 2) If everyone is paying into the system it's distributing the costs over a larger population pool, and people with insurance aren't paying the entire bill for those without insurance.

That's why I don't have a problem with the government forcing everyone to pay something into the system, and providing subsidies to people who actually cannot afford it -- because we're already subsidizing the medical costs of people who cannot afford it.

 

That makes sense. Thanks, Aldeth.

 

Fruedian slip by The One?

http://www.politico.com/news/stories/0709/25165.html

 

I guess President Obama was being redundant. We already have plenty of THAT in the current system.

 

Nah, he's just proving he is The One. Anyone that could bring forth even greater inefficiencies than we already have must either be a god or the Devil!

 

You are right. I don't think it IS possible.

 

Yes you can - if you try to.