February 2010

How did Obama’s Healthcare Summit go?  It was basically a pile of bad ideas.  Senator Harkin gave the best explanation of what’s truly needed, but I’ll save that for last.

Examples of BAD IDEAS include

Starting over.  John McCain asked to “Go back to the beginning” and Republican Senator Lamar Alexander said ”If we can start over, we can write a healthcare bill.”  The whole start over rhetoric is dumb.  If you don’t like the current proposals, say what you don’t like about them.  If you have suggestions on how to do it better, say them.  Suggesting a “do over” is not helpful.  Even if you think health care in the U.S. is perfect and prefer the status quo, you should stand up and say that rather than asking for a clean slate.

Health Reform will lower the deficit. Expanding federal entitlement programs will NOT lower the deficit.  In the short-run, additional tax revenue and cuts to other programs may decrease the deficit in the very short run, but adding or expanding big government programs never lowers the deficit.

Reforming medical malpractice.  I have documented that the medical malpractice system does not work well (see here and here).  However, malpractice costs are a small share of the overall health care dollars.  If physicians prescribe too many tests and treatments because they wish to avoid being sued, than tort reform could decrease costs more drastically.  However, this issue is more of a partisan one where Republicans can pander to their physician supporters and Democrats can pander to their attorney supporters.

End Waste and Abuse.  This is a laudable goal, but determining what is waste and abuse is difficult.  If you get an MRI for an injury, you may not need the MRI, but it will provide the doctor with some helpful information.  This is certainly not fraud, but it may be waste.  Having Medicare administrators who are far from the hospital floor determine what is wasteful is not as easy as political rhetoric makes it sound.  Further, although there is much waste in the Medicare system, there is much waste when doctors are paid by private insurers as well.  Every President promises to reduce Medicare fraud and waste, but few succeed.

“We actually create more diabetes through the food stamp program and the school lunch program.”  - Senator Coburn.  Do poor people buy more unhealthy food?  Yes.  Is it because of these programs?  No.  The poor have less money and fast food is cheap.  Fresh fruits and vegetables are expensive.  Increasing redistribution would allow the poor to eat healthier, but if Senator Coburn wants to mandate that poor people eat healthy, I think that is going too far.  People on food stamps aren’t all of a sudden start shopping at Whole Foods.  The food police are not the solution to health reform.

Here’s where the GOOD IDEAS were:

Incremental Reform doesn’t work.  Senator Wyden said, “The evidence says incremental reform not only does less, it costs more.”

The most sensible comments came from Senator Harkin.  In order to reduce health insurance premiums and Medicare expenses, we need cost control (i.e., rationing).  We need to limit the medical care we make available to ourselves.  Every person should not be able to receive every medical treatment they think will improve their lives.  Determining which treatments to exclude form Medicare or private insurance is full of tough decisions, but they must be made, otherwise health insurance premiums will gobble up more and more of our wages.

Of course, no senator could support rationing care, but that is what Senator Harkin is essence supporting.   Here is a quotation:

“Well, quite frankly, if we want insurance reforms you can only do that if everybody is in the pool. You can only get everybody in the pool if you make it affordable for middle class families and others. You can only make it affordable for middle class families and others if you have cost controls.”

The full transcript of the summit can be found in three parts (1, 2, 3).  NPR also has some good analysis here.