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Obama’s Health Care panacea
Posted by: McQ on Tuesday, May 29, 2007

Barack Obama has declared:
"The time has come for universal, affordable health care in America," Obama said in a speech in Iowa City, at the University of Iowa's medical school.
And with that he has unveiled his program. Note that the term he uses is "universal, affordable health care". OK?

Care, at least where I come from, means more than just "insurance". Interestingly, though, Obama talks mostly about insurance. Let's take a look:
Obama's plan retains the private insurance system but injects additional money to pay for expanding coverage. It would also create a National Health Insurance Exchange to monitor insurance companies in offering the coverage.
Cutting to the chase, Obama will give lip service to a "private insurance system" but will install a federal bureaucracy to "monitor insurance companies". Obviously if it only monitors but has no standards by which to compare what it finds and no ability to force compliance with those standards, it's not going to be doing much is it? So assume that will be the real job of the NHIE. And, those compliance costs are somehow going to make it cheaper.

Next:
Those who can't afford coverage would get a subsidy on a sliding scale depending on their income, and virtually all businesses would have to share in the cost of coverage for their workers. The plan is similar to the one covering members of Congress.
So instead of really doing something which would actually make insurance more affordable and easier to get - like removing it from being provided by business and letting a real insurance market (a private insurance market) develop, Obama plans on keeping these plans under employers and making all of them share the cost. Additionally, not a word about all the mandates by various state governments on minimum coverage. And all of this will somehow make insurance cheaper.

Secondly, why not, if the purpose is simply to ensure that all uninsured have access to insurance, why not fix that problem and leave everyone else alone? Instead he wants to mess with the insurance 300 million vs. the 40 or so million purported not to have insurance. Taking care of the 40 million actually might make insurance for the remaining 260 million cheaper.
Obama's package would prohibit insurance companies from refusing coverage because of pre-existing conditions.
Question: what is the easiest way to ensure "pre-existing" conditions aren't a problem? Remove insurance from being employer based. Now nothing changes when you leave one job for another. And, amazingly, it solves the portability problem as well. That actually would make insurance cheaper. What Obama is suggesting will make it more expensive as the cost of those pre-existing conditions are spread within the insurance pool of an employer.
Obama also called for a series of steps to overhaul the current health care system. He would spend more money boosting technology in the health industry such as electronic record-keeping, put in place better management for chronic diseases and create a reinsurance pool for catastrophic illnesses to take the burden of their costs off of other premium payers.
Again, having government "overhaul" anything is fraught with problems, the primary being cost and efficiency. It doesn't have a good track record with either. And someone is going to pay for this overhaul. Additionally you're looking at a mandate when you see things like "better management for chronic illnesses" and a cost increase (despite the promise of a cost decrease) when talking about government managing a "reinsurance pool for catastrophic illness", because again, someone has to pay for that pool.
His plan also envisions savings from ending the expensive care for the uninsured when they get sick. That care now is often provided at emergency rooms. The plan also would put a heavy focus on preventing disease through lifestyle changes.
Unless he plans on including illegal aliens in his insurance scheme, he's going to continue to see emergency rooms used heavily. And, if insurance pays for it and it's convenient, you'll see emergency rooms continued to be used by the insured.

As for a "heavy focus on preventing disease through lifestyle changes", that's a pipe dream. Even Ezra Klein, patron blogger of universal health care knows that's a farce:
First, the impacts of preventive medicine are often overstated. It's not that cleaning up the air or putting everyone on a gym regimen would greatly improve health — but people don't follow gym regimens, and business doesn't let you clean air. Furthermore, not all interventions are created equal. Better parenting might be beneficial, but it's unlikely to be more effective — either on economic or biological grounds — than the use of statins, or hypertensive drugs, or daily tablets of aspirin. There are a lot of highly effective medical interventions which are very, very cheap. But our system is very poor at incentivizing their use.

Meanwhile, the reason doctors are constantly prescribing statins along with admonitions to exercise and eat better is because using public policy to change diet and exercise habits is really, really, hard, unless you're prepared to be very heavy-handed (i.e, outlawing trans fats in restaurants, setting portion limits, etc). Indeed, part of the problem with preventive health measures is that, rather often, they don't work very well.
In fact, as a matter of policy, unless you're willing to force it, they don't work at all.

And who pays?

The usual suspects. Business and those magic rich folks:
"To help pay for this, we will ask all but the smallest businesses who don't make a meaningful contribution to the health coverage of their workers to do so to support this plan," said Obama. "And we also will repeal the temporary Bush tax cut for the wealthiest taxpayers."
Now I don't want to say something like "bend over and grab your ankles" but if you think health care is byzantine and costly now, let this "plan" be passed into law. More bureaucracy, more cost, more government intervention and all supported by those rich folks taxes.

Oh, and I almost forgot the most important part ... the projection of cost:
Obama said his plan could save the average consumer $2,500 a year and bring health care to all. Campaign aides estimated the cost of the program at $50 billion to $65 billion a year...
Uh huh. Sure it will. Just like Medicare Part D, huh? I have about as much confidence that his projection is accurate as I do that the government will actually enforce any immigration laws it passes.
 
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Comments
Now I don’t want to say something like "bend over and grab your ankles"
Why not? It’s true.
 
Written By: James E. Fish
URL: http://faroutfishfiles.blogspot.com/
I think you should look at his actual plan, and not just what some journalist reports on it

http://www.barackobama.com/pdf/HealthPlanFull.pdf

 
Written By: Jeff
URL: http://
Jeff:

You might want to quit passing this around. It’s even worse than what the journalist said.

For instance, statements like this:
It is simply too expensive for individuals and families to buy insurance directly on the open market and impossible for many with pre-existing conditions.
Any guess as to why that’s really a problem? See below.

And I especially enjoyed this:
Affordable premiums, co-pays and deductibles. Participants will be charged fair premiums and minimal co-pays for deductibles for preventive services.
As determined by whom, Jeff? Certainly, it seems, not the market. No, he’s going to let the government broker it all through the NHIE, huh?

In his "public plan" he gets it:
Portability and choice. Participants in the new public plan and the National Health Insurance Exchange (see below) will be able to move from job to job without changing or jeopardizing their health care coverage.
But for the rest of the country it still lays under the realm of a employer provided benefit, which means none of the above is true for most.

As for the bureaucracy, ye gods:
The Exchange will act as a watchdog and help reform the private insurance market by creating rules and standards for participating insurance plans to ensure fairness and to make individual coverage more affordable and accessible.
That is precisely what I described in the post. A bureaucracy from h*ll. And its obvious job will be to mandate coverage and fix prices. Yet he will insist on calling the market private and berate it when it fails (and allows him to put everything under governmental auspices).

Oh, and this:
Through the Exchange, any American will have the opportunity to enroll in the new public plan or purchase an approved private plan, and income-based sliding scale subsidies will be provided for people and families who need it.
An "approved private" plan? Talk about an oxymoron. Like I said, lip service to the term "private".

Meanwhile not a word about getting the states to repeal the absurd mandates they’ve laid out as minimum coverage which keeps most of those who don’t or can’t afford basic coverage from affording it.

Please, wave this document around some more.
 
Written By: McQ
URL: http://www.qando.net/blog
Give me a break Jeff. The journalist did a fine job of paraphrasing the fluff that is the actual plan. There is nothing of substance in the plan. There is no explanation of how any of these things would be accomplished. It’s political BS. Nothing new.

 
Written By: Grimshaw
URL: http://
"It is simply too expensive for individuals and families to buy insurance directly on the open market."
This, from the plan, is a flat out lie. It depends on the circumstances, including one’s state of residence.

Obama is another hack in a long line of political hacks who thinks more national "leadership" (read: centralized control) is the solution. He misses the central fact that it’s this leadership that created a large part of the problem in the first place. Definition of a politician: someone who thinks adding more gasoline to the fire will put it out. Also see: imbecile, moron, idiot.


 
Written By: Grimshaw
URL: http://
The plan also would put a heavy focus on preventing disease through lifestyle changes
Ah...better health through coercion! Suppose someone doesn’t keep up with their gym regimen? Or enjoys something with trans-fats in it? What penalties do you suppose will be levied on them by the Govt. agency in charge?
 
Written By: shark
URL: http://
McQ,

Not only are you misstating how Obama’s plan would work (for example, under his plan, all in insurance would be portable), but you continue to display a basic ignorance of how insurance markets operate.

Think about car insurance for a second. Car insurance companies spend a lot of time and energy trying to weed out risky drivers. If you get tickets or get in accidents, your rates go up. They may even cancel your insurance. Their goal is to insure only the people who are not unduly risky. As a result, people with terrible driving records either can’t get insurance or have to pay astronomical premiums.

A non-regulated, private health care insurance market would work the same way. Except instead of people who get tickets getting weeded out, it would be people who get sick or are diagnosed with certain conditions. The insurance companies would either not insure these people, or they would charge them prohibitively high rates.

The result would be a significant number of people being unable to purchase affordable health insurance.

The only way health insurance can work is if the healthy and the sick are in the same overall pool, and that can only happen if the government steps in and regulates the industry. This is Economics 101.

The ONLY way we will ever have a system that afforably insurances all or most people is if the government steps in and creates a regulatory framework in which the natural purging behavior of the insurance market is kept in check.

Health care is not like driving. When it comes to cars, we find it acceptable that certain people are uninsurable, mainly because we know that people have control over whether they get in lots of accidents or get lots of speeding tickets. But we don’t find it acceptable that people who have the misfortune of getting sick or being diagnosed with some condition (or born with it) are thereby uninsurable. And since we know that it would be incredibly easy for insurers to weed out all these people, if left to their own devices, we long ago concluded that the health care industry NEEDS to be regulated.

Once you accept that—and all sane people should—the question is then how to tweek those regulations so as to maximize coverage and minimize costs. If you want to enter that debate, fine, let’s discuss, but can we please stop pretending that everything would be better if we just did away with all the regulations? That’s total nonsense.
 
Written By: Anonymous Liberal
URL: http://www.anonymousliberal.com
The ONLY way we will ever have a system that afforably insurances all or most people is if the government steps in and creates a regulatory framework in which the natural purging behavior of the insurance market is kept in check.
This is just utter and misinformed nonsense which completely ignores the barriers government has put up in a supposedly private insurance market.

In a market for automobile insurance, risky drivers still can buy insurance. The market has provided a product for them. So to pretend that pre-existing conditions are ’weeded out’ with no coverage available is nonsense.

But it also ignores the point I made about removing insurance from under the auspecies of an employer based system. Doing so, for the most part, eliminates pre-existing conditions as a problem unless you change insurance carriers. Portability is assured.

It further ignores governmental mandates on insurance coverage which don’t allow a person seeking private insurance to buy the insurance product he or she wants.

Lastly it touts government as the only possible solution to a problem which is largely of the government’s making.

And now, the usual suspects are back trying to screw with the whole system by putting a new bureaucracy in place which is going to "save us money". Talk about famous last words.

Worried about the 47 million with no health insurance? Fix that if you must with a temporary program available to them until they can purchase a private plan. But do pay attention to those who don’t have insurance because they’re between jobs (thanks to employer based insurance) and b) who don’t have it because, shock of shocks, they don’t think they need it.

But stay away from mine. Obviously you’re not aware that a huge majority of Americans, while concerned that there are those without insurance, are very satisfied with what they have.
Once you accept that—and all sane people should—the question is then how to tweek those regulations so as to maximize coverage and minimize costs. If you want to enter that debate, fine, let’s discuss, but can we please stop pretending that everything would be better if we just did away with all the regulations? That’s total nonsense.

Well obviously you didn’t take advantage of the link Jeff left because it is apparent you haven’t read the plan. This isn’t a plan just about ’tweeking regulation’. This is a plan for the takeover of the health care insurance business (while giving "private insurance" lip service) and eventually health care.

But I wouldn’t expect a "government is always the solution" liberal to either understand or care about that.
 
Written By: McQ
URL: http://www.qando.net/blog
AL -
I don’t read anyone as suggesting NO regulation is the best route. Probably should burn that strawman in the fire of truth, eh?


A few questions for you:

1. In your estimation, what percentage of the current uninsured in this country are voluntarily uninsured?

2. What should a universal system do about healthy people who don’t want insurance?

3. What should a universal system do about people who don’t take care of themselves and become sick because of neglect and not misfortune?

4. Do we need a universal system to have portability?

5. What health care issues will a universal system not fix?



 
Written By: Grimshaw
URL: http://
"Care, at least where I come from, means more than just "insurance". Interestingly, though, Obama talks mostly about insurance."

The terms seem to be interchangeable among the sloppy thinkers in Washington.

"will install a federal bureaucracy to "monitor insurance companies""

On top of the existing state insurance regulators, of course.

"He would spend more money boosting technology in the health industry such as electronic record-keeping, put in place better management..."

Perhaps he and his advisors should go out into the real world and see what they are already doing. A hospital I worked at a year ago had just upgraded their ELECTRONIC RECORD-KEEPING to include x-rays and other imagery. Every department is on the system, with specialized applications for every department, food service, housekeeping, security, surgery, ER, etc. Quite a package of applications.

Better management? Pleeeze. I have heard all that "waste, fraud, and abuse" BS for longer than he has been out of diapers. Organizations and systems are run by people, always have been and always will be. People ain’t perfect, and they ain’t capable of producing perfection. Only politicians and fools(yeah, I know) believe in the perfectability of mankind.


" That care now is often provided at emergency rooms."

Even for the insured, particularly on weekends, holidays, and after normal business hours. And if there is a large incrase in the number of insured, even more cases will be referred to emergency rooms, simply because most doctors are already booked pretty solid.

"Obama said his plan could save the average consumer $2,500 a year and bring health care to all."

Right. Provide more health care for less money. More doctors visits, more x-rays, more lab tests, etc., will cost less. Proof that those on the left are mentally challenged.


*******************************
"but you continue to display a basic ignorance of how insurance markets operate"
"But we don’t find it acceptable that people who have the misfortune of getting sick or being diagnosed with some condition (or born with it) are thereby uninsurable"

Funny. Insurance is based on risk and probability, not certainty. The insurance company looks at statistics and probability and basically bets that you won’t get real sick cost them more than they charge you. Nobody in their right mind bets into 4 Aces showing, so why should insurance companies? What you want is health care welfare, not health insurance.

 
Written By: tmactual
URL: http://
I don’t read anyone as suggesting NO regulation is the best route.
Eh, what the heck.

First off, where does Obama get the audacity to so much as endorse a "plan" for health care or health insurance or health anything else for any Americans, much less to pretend to have himself come up with some sort of plan - for all Americans? Is he a doctor, for starters? The CEO of an insurance company? An employer having to pay more and more people to untangle more and more government paperwork? The head of a hospital corporation? Qualified in some special way to empty a bed pan?

Even if the answer is yes to all questions, he still isn’t specially qualified to come up with and try to impose some sort of overarching, all-inclusive health whatever "plan" for people in this country. And neither is any other politician. It should be against the laws of God and man for any of them to have anything at all to do with the healthcare of American people at large. They should stay out of it. Just as soon as they get out of it, I mean.

It’s absolute lunacy that anyone should have to care ten cents what Obama or Hillary or any other senator or so-called representative would recommend about how individuals in this country manage concerns about their health. And here we have to worry about what they’re going to try and require of ourselves, our doctors, our employers and employees and everybody they can aim a law at.

One more thing. The main reason that congress should not try to outlaw or legally discourage personal behavior deemed unhealthy is not that it’s ineffectual or difficult to mandate behavioral changes; it’s that it’s government gone mad and it’s wrong
 
Written By: Linda Morgan
URL: http://
So much to address, so little time:
In a market for automobile insurance, risky drivers still can buy insurance. The market has provided a product for them. So to pretend that pre-existing conditions are ’weeded out’ with no coverage available is nonsense.
Yeah, it provides a product that is, for many, prohibitively expensive. And that’s fine when it comes to car insurance, because some people probably shouldn’t drive (e.g., the blind, the extremely reckless, the perpetually drunk). But health care isn’t like that. If you develop diabetes as child, it’s not your fault. But no one will want to insure you, at least not a rate that any average person could afford (because you are guaranteed to be a heavy consumer of services). Is this really so hard to understand?
But it also ignores the point I made about removing insurance from under the auspecies of an employer based system. Doing so, for the most part, eliminates pre-existing conditions as a problem unless you change insurance carriers. Portability is assured.
There are a couple problems here. First, this assumes that you have a system where insurers are barred from dumping you or raising your rates after you get sick or are diagnosed with something. That, in itself, is a major form of government regulation of the market (which you seem to be okay with).

Second, this only works if you happen to buy your insurance prior to being diagnosed. If you wait a day too long, you are hosed for life.

Third, even under your hypoethetical, people with pre-existing conditions can’t change insurers (without having their rates skyrocket). Since most people have pre-existing conditions of some sort, this makes the market incredibly inefficient. People become locked in for life with whatever plan they happened to have when they got sick or diagnosed. The market only works when there is competition and choice, which there wouldn’t be under your system. Again, this is economics 101.

Fourth, one of the primary reasons insurance was mandated through work was because employers, particularly large employers, had the ability to buy in bulk, thereby increasing their power to negotiate affordable rates. Individuals lack this kind of bargaining power. Employers are also generally more sophisticated consumers with better bargaining abilities, which thereby increases the efficiency of the market and reduces costs. Costs of insurance would rise if employers no longer acted as the primary purchasers. Also, the large pools created by employer groups serve as a check on the ability of insurance companies to purge or exclude people they percieve to be unacceptable insurance risks. A large employer can demand that every one of their workers be covered for the same price. An individual lacks this ability.
Lastly it touts government as the only possible solution to a problem which is largely of the government’s making.
Last time I checked, McQ, there is no other actor out there with the ability to set rules. If regulation of an industry is needed (which you concede it is), the government is the only possible entity capable of providing it.
 
Written By: Anonymous Liberal
URL: http://www.anonymousliberal.com
One more thing. The main reason that congress should not try to outlaw or legally discourage personal behavior deemed unhealthy is not that it’s ineffectual or difficult to mandate behavioral changes; it’s that it’s government gone mad and it’s wrong.
Linda, you’re not making any sense. Obama isn’t trying to dictate your medical treatment. He’s trying to set up a policy framework in which everyone can afford to go to the doctor. That’s absolutely the job of politicians.

And even putting aside for a second the fact that all laws are intended to influence people’s behavior, your point still doesn’t make any sense. Obama’s not trying to "mandate personal changes". He’s trying to reduce the overall cost of health care in this country by allowing people to afford insurance and thereby receive the kind of preventative care that they are not receiving today. As I’ve explained in previous posts, the idea that the government can just stay entirely out of the health insurance arena is pure craziness. Even McQ, in his various arguments, concedes this point.
 
Written By: Anonymous Liberal
URL: http://www.anonymousliberal.com
I don’t read anyone as suggesting NO regulation is the best route. Probably should burn that strawman in the fire of truth, eh?
Yeah, tell that to Linda Morgan. I’m glad some of you are willing to concede that regulation is necessary. My point is that once you’ve conceded that some regulation is necessary, the conversation logically moves to a discussion of what those regulations should be. That’s the conversation Obama is trying to have. He’s suggesting that his regulatory framework would provide more coverage at less cost than our current regulatory framework.
A few questions for you:

1. In your estimation, what percentage of the current uninsured in this country are voluntarily uninsured?
It depends on what you mean by voluntarily. There are certainly a significant percentage of people out there who could afford insurance if they were willing to were willing to drastically tighten their belt in every other area. But I hardly blame these people for placing things like housing costs above insurance costs on the priority list. These are the working poor we’re talking about. They make tough calls every day. Some of the uninsured are reckless youths gambling that they won’t get sick, which is a whole nother issue.
2. What should a universal system do about healthy people who don’t want insurance?
A tough question. It sounds like Obama’s plan wouldn’t mandate that people buy insurance. If insurance is sufficiently affordable, I think I’d favor mandated coverage. There are societal costs involved with the decision not to buy insurance (because we end up paying for the people who show up in the emergency room). This is why we mandate the purchase of car insurance, for example. I don’t see why we shouldn’t do the same thing in the health care arena, assuming coverage is affordable.
3. What should a universal system do about people who don’t take care of themselves and become sick because of neglect and not misfortune?
I think this is a horrible slipperly slope we shouldn’t go anywhere near. It’s too hard to determine whether conditions are your "fault" or just a result of bad luck. I’d hate to see people penalized in such a gray area.
4. Do we need a universal system to have portability?
No. Portability can be accomplished through simple rule-making.
5. What health care issues will a universal system not fix?
Universal care will not fix the problem of rising costs. It will help the problem by allowing more people to get preventative care, and a good universal system will reduce a lot of the unnecessary overhead, but the main driver of rising costs is new technology and medication. There are just a lot more ways to treat people now than there used to be and many of them are very expensive. Universal care will not change that underlying dynamic.
 
Written By: Anonymous Liberal
URL: http://www.anonymousliberal.com
AL -

I don’t think Obama is genuinely interested in a conversation. Not if we define a conversation to be a thoughtful and open-minded exchange of ideas - all ideas. I don’t think politicians in general are interested in a genuine conversation at all.
"There are certainly a significant percentage of people out there who could afford insurance if they were willing to were willing to drastically tighten their belt in every other area. But I hardly blame these people for placing things like housing costs above insurance costs on the priority list. These are the working poor we’re talking about. They make tough calls every day."
I don’t deny this group exists to some extent, but I doubt very much that many of the self-appointed advocates for this group have any concrete understanding of their situations and what sacrifices they are and are not capable of making. It’s easy to assume that the trade off is between food or housing and healthcare - that makes for good political propaganda - but is it really so, and to what extent? No one seems to want to tell the "working poor" to have fewer children either. The working poor seem to be complete victims in the eyes of some. I know for a fact that it just isn’t so. Some of these folks choose to abstain from insurance when they could afford it. Some of them can’t afford it because their governments mandate coverages that drive its cost too high.
Some of the uninsured are reckless youths gambling that they won’t get sick, which is a whole nother issue.
Probably more than you think. I’ve personally known a few like this.
If insurance is sufficiently affordable, I think I’d favor mandated coverage.
I believe they are trying this in Mass. and it’s not working so well. What are you going to do with those who refuse to buy it?
I think this [people who neglect their health] is a horrible slipperly slope we shouldn’t go anywhere near.
Do you honestly think, once the government has more involvement in managing the costs of health care, that there is not going to be stong political pressure to ’manage’ costs by forcing people to alter their behavior? There will be tremendous incentive to do so, especially considering the evidence that many of our most prevalent diseases are the result of lifestyle decisions (Heart disease, some cancers (lung esp.), stroke, diabetes). The greater the government’s involvement in health care, the greater the scrutiny and coercion.
It[universal care] will help the problem by allowing more people to get preventative care...
Many people who now have insurance and plenty of access don’t seek preventative care. Why is this going to change behavior significantly? Are the uninsured more likely to demonstrate a stronger propensity for preventative care? I’m quite skeptical.
...a good universal system will reduce a lot of the unnecessary overhead...
A lot is riding on the meaning of ’unnecessary’ in this. One can argue that centralization always has the potential of reducing overhead, but what are the trade offs? We could reduce a lot of overhead by legally mandating only one type of car for sale in the US, but at what cost? Overhead is a by-product of free choice. I suggest we look harder at the root causes of existing overhead and see if we can do anything there before such a massive overhaul. How much of that overhead is a result of rules and regulations with higher costs than benefits?

I believe one of the the primary drivers behind a push for universal anything is a desire for all the problems to go away in one easy wave of the hand. People who protest the most seem to be least likely to understand the existing complexities and least interested in looking for opportunities to make smaller but significant changes.

For an example of a small but significant change that has already occured, the Treasury compiled some stats from various sources that HSAs have grown dramatically, from 438k in 2004 to 3.2 million in 2005. 31% of these people were previously uninsured. 33% were from small businesses that didn’t offer coverage before. 42% of families or individuals with incomes below 50k have apparently bought HSA’s as well. I’m not claiming these stats are 100% accurate (though they could be) but being a holder of an HSA myself, I can tell you that they are indeed a wonderful tool for providing low cost health insurance. It’s because of examples like this that we all need to take a deep breath and carefully assess the benefits and costs of universal health care/insurance - especially when such proposals are coming from the mouths of politicians eager to win votes.

 
Written By: Grimshaw
URL: http://
Anonymous Liberal,
Universal care will not fix the problem of rising costs.
Agreed, so let’s get some facts behind your assertions:
help the problem by allowing more people to get preventative care
According to the New England Journal of Medicine the percentage of people receiving recommended Preventative Care was:

54.0% for those without insurance,
55.5% for those with Medicaid,
56.5% for those with Medicare,
55.5% for those with Managed Care, and
53.3% for those with Private nonmanaged care

the P-values on these were all quite high, meaning there was no statistical difference between those without insurance and those with any other type of insurance. The lack of statistical significance also existed for both Acute and Chronic care.
a good universal system will reduce a lot of the unnecessary overhead
According to HHS 7% of National Health Expenditures is spent on "Government Administration and Net Cost of Private Health Insurance" with the remainder being spent on items like hospital care, physician services, nursing and home health care, prescription drugs, medical devices, etc.

Prescription drugs, I hear you saying. If only we could negotiate. . .

Well let’s say that we could ignore the negative ramifications of removing incentives for drug development and negotiate like other developed countries. We could say, reduce the costs of prescription drugs by 40% or so. Prescription drugs make up about 10% of National Health Expenditures.

So now taking this miracle of single-payer, we can cut out half of the administrative costs and 40% of prescription drug costs (and while we’re at it put two fairly large industries with highly-educated and reasonably highly-paid employees out of business). We’ll save $780 per employed person.

And with 1988 estimates that showed a ratio of 7:1 of Medicare payments going to those in the last year of life relative to the rest of Medicare recipients, and 27-30% of expenditures in the last six months of life, the problem is going to get worse as the baby boomer demographic approaches life expectancy.

And since you keep citing Economics 101 (personally, I feel insurance moral hazard and information asymmetry is a little above the 101 level), perhaps you could reconcile how providing a service at either a subsidized rate or free of charge to the 45 million people who don’t currently have that service without any way to increase supply of such service will not only keep costs down, but actually cause them to fall. Because this is Economics 101 - and based on any single-payer health plan, supply is fixed and demand skyrockets. Maybe you’ve found an upward sloping Demand curve somewhere along the line, but it certainly wasn’t in Econ 101 nor was it for health services.
 
Written By: m.jed
URL: http://
Speaking as the guy who argues in favor of Universal Health Care, this plan is crap.

This plan does not nothing to address our utterly ridiculous hybrid system, we need to move one way or the other, but simply paying for people to be in this hodgepodge system is a waste of time and money.

I can defend and support a single payor system, and I can defend and support a completely private system, but I can neither defend or support a system that just makes a bad thing worse.

For me, this is the nightmare sentence:
The Obama plan will guarantee coverage for every American through partnerships among employers, private health plans, the federal government, and the states.
I read that as follows:
The Obama plan will guarantee coverage for every American through partnerships among employers (who will opt out as soon as their employees can get free health care from the government, and no tax break is as good as not paying the cost in the first place), private health plans (that will be public health plans or rape the taxpayers, depending on the legislation), the federal government (which will be paying for a lot more of this Obama thinks out of our pockets), and the states (who eat a bucketload of indigent care every year as well as paying for Medicaid and would continue to do so in this mishmash of a non-plan).
I kind of like Obama, and clearly his advisors on this subject are either very naive or very cynical, but either Obama does not read and consider his own policy, or he is not as bright as I had previously thought.


Either go big or stay home.


Obama’s plan is neither a solution, a step toward a solution, a stopgap solution, or a any other kind of solution, it is just a step toward making a messy system messier.

Cap
 
Written By: Captin Sarcastic
URL: http://
AL - again - on how Obama can - and should - squeeze the perfect cure for what ails us out of our very own tax dollars:
He’s trying to set up a policy framework in which everyone can afford to go to the doctor. That’s absolutely the job of politicians.
Way too many millions of Americans believe that proposition without question. Worse, they seem to assume that the ability of some schlub to get elected somewhere magically demonstrates his expertise in diagnosing and treating - with liberal applications of mega-government intrusion - some murky, systemic problem preventing optimum distribution of health care. Government’s been working on this god-awful problem for quite some time now and with Obama’s (or Hillary’s or [insert politician’s name here]’s) long-needed expert attentions and the jillion zillion dollars that we’ll actually save by implementing the plan, it’s as good as solved. Not only that, but:
his regulatory framework would provide more coverage at less cost than our current regulatory framework.
What’s not to like? Of course there are a few thorny issues to consider, personal choice and responsibility not being among them:
1. In your estimation, what percentage of the current uninsured in this country are voluntarily uninsured?
It depends on what you mean by voluntarily. There are certainly a significant percentage of people out there who could afford insurance if they were willing to were willing to drastically tighten their belt in every other area. But I hardly blame these people for placing things like housing costs above insurance costs on the priority list.
Gee. How would you and Obama feel about me putting my housing costs above the insurance costs of a bunch of people who elect not to buy their own damned insurance??? Could I voluntarily opt out of picking up their tab for things they don’t want but that you say they must have and at a cost you - I mean Obama - get to set?
 
Written By: Linda Morgan
URL: http://
I see the logic of mandatory individual insurance, and in fact, once that is a given, the insurance companies simply recalculate their rates to assume that they cannot cherry pick customers. Everyone’s rates will go up, sure, but that’s a price society (via voting) can decide is worthwhile.

Then, employers will not be in charge of health insurance and let the consumers choose it for themselves. It also becomes automatically portable.

For those without the ability to pay for their health insurance, we simply give them a transfer payment via their income tax ala EIC.

The system is kept private. The insurance companies just have to re-jig their rates, and companies no longer have to worry about health benefit management.

Yes, it does punish people who don’t want any health insurance at all, but its a sop to keep people from whinging on and on about the uninsured.

 
Written By: Harun
URL: http://
Either you pay for your healthcare, your company pays for your healthcare, or government pays for your healthcare.
Why should your company pay? No skin off their nose.
Why should you pay? You should and you should get the best deal possible, when you can afford it.
Why should the government pay? Because like insurance companies, the government can garner a pool of people to pay for the costs of a few poor people getting sick each year.

Who can be opposed to a system that says wealthy people pay for their own; the middle class pays for its own wellness and is protected by government-funded catastrophic insurance if needed; and the poor people are covered regardless?

Or should we only have sickly poor people in pain and suffering; middle class people wiped out by a catastrophic health problem and go bankrupt; and wealthy people who get free medical care?

You decide. I am going to work now for a company that has health savings accounts and high deductible emergency health coverage. They cannot afford to pay for anything else and are pleased to be able to offer something to their employees; as their alternative was to discontinue company-paid health insurance completely.

Thank goodness my wife and I have no chronic problems at 55 years of age...yet.
 
Written By: kindlingman
URL: http://
Who can be opposed to a system that says wealthy people pay for their own; the middle class pays for its own wellness and is protected by government-funded catastrophic insurance if needed; and the poor people are covered regardless?

Or should we only have sickly poor people in pain and suffering; middle class people wiped out by a catastrophic health problem and go bankrupt; and wealthy people who get free medical care?
I can buy a very reasonably priced catastrophic insurance policy right now. It is my responsibility to do that, not yours. Why should I demand you to pay for it?
 
Written By: McQ
URL: http://www.qando.net/blog
The point is that insurance companies use a risk pool. Your costs are lower if the pool is larger. Who can pull a larger pool than the US government?
 
Written By: kindlingman
URL: http://
The point is that insurance companies use a risk pool. Your costs are lower if the pool is larger. Who can pull a larger pool than the US government?
Remove it from being an employer provided benefit and you’d have as big a pool as you’d need without involving government.
 
Written By: McQ
URL: http://www.qando.net/blog
Your costs are lower if the pool is larger.
At the aggregate level, the costs are what they are. Adding more people to the total pool only lowers average cost if those who were previously not in the pool are healthier on average than the aggregate pool before they were added. With the assumption that those presently outside the pool look exactly like those currently in the pool, adding more people to the pool will raise aggregate costs and average costs will be exactly the same. We know with certainty that ex poste healthy individuals will have paid premiums that will have been too high and thus subsidize unhealthy individuals - that’s the risk sharing component. But the government prevents insurers from charging the ex ante actuarial correct rate for health insurance under the guise of "fairness". So for life insurance, smokers, the obese, or those with family histories of early mortality pay higher premiums, but this isn’t the case for health insurance, and I can’t envision a scenario where a government-provided health insurance program charges more of smokers or the obese even though on an actuarial basis they are significantly more expensive.


When you say this:
Who can be opposed to a system that says wealthy people pay for their own; the middle class pays for its own wellness and is protected by government-funded catastrophic insurance if needed; and the poor people are covered regardless?
What I’m hearing is: Who can be opposed to a system that says wealthy people pay for their own; wealthy people subsidize the consumption of the middle class who prefer to spend their money on goods and services other than their own health insurance (or education and retirement expenses for that matter); and wealthy people pay for the health insurance of the poor
 
Written By: m.jed
URL: http://
Kindlingman -

Your assertion is that the benefits of a competitive insurance market are worth losing to have a single large risk pool managed by the government. I don’t buy it. Competitive pressure - when the government doesn’t step in and limit it - is a better tool for keeping costs low than political pressure. Politicians and the centralized health insurance bureaucracy they will create, will have little incentive to make the best decisions for each individual case. In fact, it will be impossible. It’s a bad idea.


 
Written By: Grimshaw
URL: http://
ok, I see dimly here. Our current competitive insurance programs in the United States are as good as it gets. The 40% of the population that cannot afford healthcare is the best we can hope for. The live birth rates are the best we can do with the best competitive health care system in the world. European nations with univeral healthcare and better live birth rates are worse than us. We have the best healthcare that money can buy, even if we cannot afford it. We should just accept the results, whatever they are, as being the best in the world.

I did not come to quibble. I came only to say that either you pay for healthcare, your company pays, or your government pays. Choose one or a combination. What you choose will determine how many poor people will have pain and suffering and how many middle class bankruptcies will be caused by health care costs. My aunt pass away recently and we discussed the decisions she made daily on what she could afford and what she could not: diagnosis, treatment, and medication. She worked for insurance companies in the past and was well protected for 1980 retirement, and not 2005 after she had been out of the work force for 20 years without an income.

If a competitve healthcare insurance system is THE way to go, why doesn’t a single insurance company tap the 40% of the market that is not buying their products now? I am reminded of the story about the two sales people who go to Africa to sell shoes. One reports that "No sales possible, natives don’t wear shoes." The other reports "Huge potential for sales, the natives don’t wear shoes."

So why don’t insurance companies try to capture the other 40% of the market?

 
Written By: kindlingman
URL: http://
ok, I see dimly here. Our current competitive insurance programs in the United States are as good as it gets.
Current competitive insurance programs?

What are you smoking? OK, that’s a lighthearted jab.

First - States mandate minimum coverage which is why many can’t afford insurance. Second - employers manage health care (thus the pools are small). Third - Government price fixes which causes there to be cost shifting onto the privately insured, driving up prices.

Competitive?
 
Written By: McQ
URL: http://www.qando.net/blog
And in addition to what McQ stated, there are many people who CAN afford insurance but choose to forgo it. While that may seem completely irrational to you, it doesn’t seem so to the 20-something who’d rather spend the money on beer. He’s going to live forever anyway, right? Insurance is the cheapest for them and yet they don’t buy. That’s got nothing to do with marketing.


By the way, 40% is an overstatement of the uninsured market. Relying on the 46 million uninsured number that floats around, the percentage is more like 16%.

 
Written By: Grimshaw
URL: http://
Ok, I surrender. It is 45 million people, give or take. Then you are right again that we already have the best healthcare programs in the world and we should be proud of the fact that 16% of Americans have no insurance. Everyone else has insurance that is adequate to meet their needs *cough* and my aunt’s choices to control her healthcare costs on a fixed income were simply bogus. So when she asked me to check into getting her medication from Canada, I should have declined and said "Aunt Marge,we have the best healthcare system in the world and you should be able to afford your apartment, your treatments, and your medications. You can just take some more of your annuity out and you will be fine although you will run out of money sooner."

But you say our healthcare is not competitive because of government controls, company-managed pools, and young people who don’t need health insurance that are not buying it. And yet we lament that any changes to healthcare will reduce its results or put in place a worse system.

I hope that your health remains strong and that you are always free from medical debt. I hope you never use your credit cards to pay for a loved ones heart surgery or transplant, or for your own, after you are on a fixed income. I hope that your medication costs are never 20% of your monthly income. And I hope that you never have children that require 15-25% of your monthly income and 50% of your spouse’s time for the remainder of your natural life.

I was truly fortunate and this never happened to me. But it has to others.

I also sincerely hope that in ten years as my body breaks down and costs rise and I cannot work for medical reasons, that someone has seen my side of the debate and has a solution.





 
Written By: kindlingman
URL: http://
I hope that your health remains strong and that you are always free from medical debt.
It won’t but I will. It’s called catastrophic health insurance policy. They’re cheap. Go buy one.
 
Written By: McQ
URL: http://www.qando.net/blog
Ah, I see my problem dimly again, I need more of the same. Why didn’t I think of that? Never mind.
 
Written By: kindlingman
URL: http://
You’re doing an excellent job tossing out strawman arguments. Has ANYONE advocated more of exactly what we have? How does opposition to universal care/insurance imply everything is just fine as it is? You’ll argue with yourself all day in a corner about keeping things just as they are. No one is saying that.
 
Written By: Grimshaw
URL: http://
Looks good! Very useful, good stuff. Good resources here. Thanks much!
 
Written By: Irving
URL: http://www.google.com/
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