We’ve discussed it before, why are costs so much higher in US healthcare compared to other countries? The Washington Post has a pointless article which seems to answer with the tautology costs are high because healthcare in America costs more. How much more? Well, we spend nearly twice as much per capita as the next nearest country while failing to provide universal coverage:

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In the WaPo article they make a big deal of the costs of individual procedures like MRI being over a thousand in the US compared to $280 in France, but this is a simplistic analysis, and I think it misses the point as most authors do when discussing this issue. The reason things costs more is because in order to subsidize the hidden costs of medical care, providers charge more for imaging and procedures. For instance, Atul Gawande, in his New Yorker piece “The Cost Conundrum” wonders why is it costs are higher to treat the same conditions in rural areas and in a major academic centers like UCLA than at a highly specialized private hospitals like the Mayo Clinic? I think the reason is it’s not nearly as expensive to administer and provide care for a select group of insured midwesterners at the Mayo than it is to provide care to the underserved in the poor areas of inner-cities and in poor rural locations.

When you are serving a poorer, under-insured population like you get in LA or Baltimore for that matter, the insured are charged more because EMTALA requires hospitals to treat all comers, regardless of insured status. Medical centers like UCLA or University of Maryland are the final common pathway for the sickest and poorest patients who, even if stabilized at smaller local hospitals, are immediately transferred to such centers. These patients are expensive to treat, often have more co-morbidities like HIV or drug use and mental illness, and there is no reimbursement guarantee for taking care of them even though it is our legal and ethical responsibility to do so.

Further, the cost of defensive medicine, which applies to this patient population as much as any other, ramps the costs of all hospital admissions and medical practice in general. It is also incredibly hard to quantify its contribution to the overall costs of care.

As a result, to pay for excessive care of the uninsured, all procedures, all tests, all imaging, and all hospitalizations cost more. Caring for inpatients and the uninsured is expensive, so the costs are transferred to the prices of outpatient elective care and procedures which are often administered in a fee-for-service model. Hospitals have an incentive to provide as much outpatient elective care as possible in order to offset these other costs and to generate revenue. The providers that perform procedures or expensive testing then become far more expensive to pay as they are the major revenue generators for the hospital (hence surgeon vs pediatrician pay). Especially because in order to generate more revenue they are paid based on how many procedures they perform. All the incentives are towards more utilization, more procedures, more revenue generation. This is the hidden tax of the uninsured.

In a way, we have universal healthcare already, but we pay for it in the most irresponsible and costly way possible. We wait for small problems to become emergent, treat them in the most expensive outpatient provider possible (the ER), and then when we can’t pay the bills for the uninsured, we transfer the balance by increasing the costs of the care of insured patients showing up for their cholecystectomies or back surgery. Tack on the costs of defensive medicine and the fear of being sued unless everything is done to cover your ass, and you have a recipe for extremely costly care.

Other factors figure into higher costs as well, including hugely higher costs of medicare administration since Bush privatized it, higher prescription drug costs since Bush passed medicare part D and prevented bargaining with drug companies, and our incredibly high ICU expenditures at the end of life. the McKinsey report on excess costs demonstrated most of these issues in 2008. This is not news. The US spends far more on medical administration, outpatient/ambulatory care (with hospital-based outpatient care increasing most rapidly in costs), drugs, doctors salaries, and end-of-life care than we should as a percentage of our GDP.

So what should we do about it? At every step we need dismantle the tendency towards increasing costs. Here are my suggestions:

We should have universal health care so that everyone can visit a physician early, take care of their problems while they are still manageable, and to provide cheap preventative care.

We need to strongly discourage overuse of the ER, as it is the most expensive form of ambulatory care and they are currently overburdened with treatment of non-emergency conditions.

We need to change the destructive medicare part D legislation to allow collective bargaining by Medicare for cheaper drug costs as they do in other countries or as they do in VA health system where drug costs are 50% less.

We have to end fee-for-service reimbursement systems that create incentives for hospitals to generate revenue by pushing more procedures, more tests, and more expensive utilization of resources. One thing that Atul Gawande got correct was that when physicians were salaried independent of their revenue-generation for the hospital, as at Mayo, costs go down. When incentives are created for physicians to generate more revenue for the hospital, physicians will generate more revenue for the hospital.

We have to pay physicians based on their amount of training. Surgeons will still win under this system, as they should, because their training is typically 4 years of medical school, 5-7 years of residency followed by 2 years of fellowship compared to 3-5 years for most internal medicine specialties. Paying for all that education is expensive. Further the opportunity costs of the lost income-generating years in training compared to comparable careers in law or business need to be paid back to physicians somehow. We dedicate hundreds of thousands of dollars to medical school, work 80 hour weeks for years as residents for a puny salary, and basically defer a decent income for an additional decade in order to gain skills to take care of patients. The quality of physicians will suffer, especially those that require longer training, if they are not paid commensurate with their personal investment in training. We could reasonably expect physicians to expect less compensation if their education costs are drastically reduced or eliminated, and if resident incomes can be improved relative to the amount of work they perform. Granted, this will never happen.

Finally, we have to fire the Republican morons who have decided any discussion of making end-of-life care more evidence-based means creating “death panels” to kill grandma. We need better science about about outcomes at end of life. We need to get better at knowing when care is futile and when it should be stopped for the benefit of the patient as well as health care resources. And as part of universal care everyone should discuss a living will and end-of-life decisions with their physicians. Initially the health care reform act included provisions to reimburse physicians for discussing living wills with their patients as a separate consultation. This, under the death panels stigma, was eliminated. I can think of few other acts of such far reaching harm for cheap political points in my lifetime. People need to make decisions about how they want to die before these decisions are out of their hands. They also need to understand what death looks like in the ICU. Most physicians would not chose this end for themselves. When physicians are called upon to do everything at the end of life the patient will likely end up with tubes in every orifice, central lines, ventilators, powerful drugs, and lots, and lots, of iatrogenic pain. It’s not the way I want my life to end, and I think if people understood that maximum intervention often generates suffering with no real benefit, they would be less likely to chose this path for their loved ones. Not that ICUs aren’t amazing places where a great deal can be done for many patients, but they also can be a place for needless suffering when the patient has little to no chance of meaningful recovery. It is heartbreaking that Republicans destroyed the well-meaning efforts to scientifically study these situations so physicians and patients could be better informed and equipped to make such end of life decisions.

Comments

  1. #1 Wow
    March 5, 2012

    And, because it’s more expensive to treat the insured, the costs to the insured goes up. Therefore there are more people who cannot now afford insured medical care.

    This leads to even higher costs having to be paid for the uninsured out of the insured people’s rates.

    And so even more cannot afford insurance.

    See where this is going yet?

  2. #2 JG
    March 5, 2012

    Many thanks for this excellently reasoned piece.

  3. #3 CaveatMTor
    March 5, 2012

    Excellent article – I agree with everything you said. A couple of additional points:

    Due to the way our third-party reimbursement is usually structured, the normal moderating effects of supply & demand aren’t operational. When a patient pays just a set fee for, say, a drug, regardless of cost, that patient usually wants the most expensive proprietary drug on the market, even if cheaper alternatives (generics or drugs off patent) are available. If that patient has just a 10% co-pay, the generic starts looking better. A system of medical savings accounts with such co-pays would bring some cost sensitivity into the demand structure.

    Many docs pay no attention to relative costs of different procedures & drugs. I was married to an ER doc for 22 years, and she had no idea what billings resulted from her practices and prescriptions. This could be modified, at least for drug alternatives.

    Regarding your point about physician compensation: While your main point is well-taken, it does appear that certain specialties are under- or over-compensated relative to other specialties. I don’t know why the employment “market” hasn’t adequately taken care of these seeming disparities, and wouldn’t want some bureaucratic comparison to overrule the market, so there may be no answer to this.

  4. #4 Wow
    March 5, 2012

    “If that patient has just a 10% co-pay, the generic starts looking better.”

    However, the patient still has to pay each and every month to be able to pay that 10%.

    Therefore the patient will STILL want medication, even if it’s not necessary.

    Maybe medical training needs to be (optionally?) underwritten by the government but with a required fairly large term of service in government health care and hospitals (with lower pay), and a requirement for a certain number of hours to be worked for the remainder of their career.

    This could be an option, based on whether you take the government aid or not, though a portion of the time ought still to be required to be worked for public benefit.

    Solicitors, IIRC, have to do a certain amount of public work.

  5. #5 Kagehi
    March 5, 2012

    I don’t know why the employment “market” hasn’t adequately taken care of these seeming disparities, and wouldn’t want some bureaucratic comparison to overrule the market, so there may be no answer to this.

    Uh, because libertarianism doesn’t work even in terms of what you get payed? lol Seriously though, its stuff like that which makes me want to slap people, every time they claim that the “market” by itself will fix all problems. No… The market will fix things so that a few get rich, at the expense of everyone else, and this won’t change, because there is no incentive, if 99% of business owners are following the same game plan, to change it. After all, where in the “market” are all those underpaid people going to go, instead of where they already work, so the market *can* correct itself?

  6. #6 Antonio Lorusso
    March 5, 2012

    Using force against someone (except in defense against aggression) to get what you want (for whatever reason) is immoral. And government is force, because every law is enforced with a gun, not an debate.

    If you disagree, you are a denier.

  7. #7 NJ
    March 5, 2012

    AL@6:

    If you disagree, you are a denier rational.

    Fixed that for you.

  8. #8 Wow
    March 5, 2012

    “If you disagree, you are a denier.”

    Disagree to what?

    “And government is force”? No I don’t.

    “Using force against someone to get what you want (for whatever reason) is immoral”?

    I do. If only because such a black-and-white answer is never supportable.

    And what would you do to stop someone using force to take your stuff? Force.

  9. #9 MarkH
    March 5, 2012

    Why, I remember just last week when I had to get my car emissions tested they showed up at my door, the jackbooted thugs, and at gun point forced me to drive to the testing station. Or like when I was getting licensed I was held down and waterboarded for an hour in order to force me to take step 3 and pay the licensing fees. And now the government wants to charge me a fee for repavement of the alley behind my house, they sent me a letter with no offer for public commentary on the project or with options to for the neighborhood to contract privately to do the job, instead it was just a picture of my face with crosshairs on it and a pricetag. It’s not a day goes by that some government agent doesn’t point a gun at me and make me obey some law.

    That was a beautiful example of crankery Larusso. It was off topic, totally cranky, and full of that absurd hyperbole we’ve come to love. Gotta love it.

    As far as why the market doesn’t correct the disparities in specialist pay, it’s the market that is to blame. The specialties that make the most money are the ones that generate revenue for the hospital or perform lots of outpatient procedures. It isn’t their rarity or lack of supply that generates the disparity in costs as the numbers of graduates for each specialty are controlled by ACGME and largely prevent gluts or shortages. Nor is it necessary their overall value to public health (see pediatricians or GP’s vs cosmetic plastics practice). Dermatologists, surgeons, interventional radiologists, etc., are the cash cows and they are paid commensurate with their revenue generating potential in terms of RVUs. Often, their pay or whether they continue to be employed is dependent on how many RVUs they generate.

    The incentives are to generate more revenue for the hospital, the specialties that generate RVUs get paid more. There is a serious need for more GP’s but no financial incentive for them to fill that need since they do not generate the same level of revenue. GP spots in residencies have to rely on foreign medical graduates to fill slots. Despite being “needed” they are not well paid for their time under this billing structure that dramatically favors procedures and intervention.

  10. #10 Morgan Price
    March 5, 2012

    “We could reasonably expect physicians to expect less compensation if their education costs are drastically reduced or eliminated, and if resident incomes can be improved relative to the amount of work they perform.” Well, lots of other countries have more doctors per capita than the US despite paying them a lot less. And the US does have medical providers who are trained less and paid less than GPs and play roughly the same role, but we call them registered nurse practitioners or physician assistants instead of doctors.

  11. #11 Tony P
    March 5, 2012

    One of the things you could do is make the medical degree LESS expensive. No need to ring up hundreds of thousands. This would mean essentially nationalizing the universities in the U.S. which in my opinion, wouldn’t be such a bad thing.

    But your article does make some concrete suggestions that would definitely bring the cost of health care down out of the clouds. Preventative care is what systems like that in the UK focus on instead of the payment per procedure model we use.

    A few years ago I believe it was the Missouri VA was spending $45,000 a year to care for some of it’s patients. They decided to try a novel experiment. They sent the doctors out into the field. Two interesting things came about from doing that: the cost dropped to $17,000 a year, but more significantly health outcomes actually showed a dramatic improvement.

    The doctors in the field were stunned. But then they realized, they could head off the pneumonia in the quadriplegic, to those bed ridden, etc. They could head off the major problems. Plus they developed a relationship with their patients that had the benefits of patients being honest with their doctors so further problems could be addressed.

  12. #12 harold
    March 5, 2012

    Since I agree with every word of the OP here to the point of having said many of the same things myself independently, I will just note what I think would be a pragmatic first step toward universal health insurance.

    Deliberate sabotage by GWB notwithstanding, Medicare, at current reimbursement rates, is well-accepted by patients and physicians, and already pays at least 30% of medical costs in the US. Make it universal, regardless of age, on a voluntary basis. (*This would, it is true, almost destroy the private insurance industry overnight, but it would probably be worth it*.)

    Your graph shows Canada to have the second worst stats on cost, but still to be doing much better than the US. The Canadian system is not entirely dissimilar to everyone having Medicare (not everything is fee for service, but a fair amount of things are).

  13. #13 DJS
    March 6, 2012

    This was beautifully reasoned and written.
    I would add Fraud,in particular , Medicare fraud and the lax oversight of the Federal government of providers who submit to Medicare.
    I would like to know why Medicare claims are processed by private contractors and not the government.
    Just the other day,the New York Times ran an article which said that the privately run Medicare programs were not required by law to report improprieties /fraud to the Federal government.
    Less than 2% of Medicare providers are routinely audited by Medicare. I propose getting rid of Medicare Advantage programs completely. They cost the government more per beneficiary, have less oversight,and are even more susceptible to fraud. Take Medicare, INCLUDING medicare Part D out of the hands of PRIVATE INSURERS. Government absolutely should negotiate for best prices for medications.

  14. #14 Roland
    March 6, 2012

    Both Medicare and insurance companies have fee schedules. It’s fee-for-service. It’s a perverse incentive. The more ‘services’ they provide, the more $$ they make. No one (except the patient) has any incentive to decrease costs or increase productivity. It’s working as designed.

  15. #15 Helen Schott
    March 6, 2012

    It seems to me that GPs should be paid more than specialists because they are in short supply and their job is harder due to the greater breadth of knowledge required. Being a specialist with a narrow band of problems to keep current on and to assess is easier. Also doing away with malpractice suits and defensive medicine will not impact costs where I live in Wisconsin. The entire state has no service area where medical suppliers have not established monopolies or duopolies thru consolidations of clinics and purchases of hospitals and clinics. Their charges and collection efforts are rapacious. The $1500 MRI is common here. The author of this article fails to address the fact that the US gives 15% of its GNP to cover 60% of its population well and 40% inadequately. Utilization for tests referred to as defensive medicine are not much lower in countries that devote half as much of their GNP to medical care. From my observations in Norway, England and Italy, the clinics and hospitals are spartan but adequate. In the Wisconsin, because of lack of price competition, the competition occurs partially thru providing palacial treatment centers and delicious food at the hospitals. Doing away with Medicare and private insurance will leave the residents of Wisconsin vulnerable to medical providers who have established monopolies or duopolies.

  16. #16 harold
    March 6, 2012

    Both Medicare and insurance companies have fee schedules. It’s fee-for-service.

    So does the Canadian system and so do some other successful universal coverage systems.

    Universal coverage, especially with most people covered by familiar, trusted, and relatively efficient payer, is a popular and potentially achievable idea.

    If you insist on fighting against fee for service as a matter of principle, you are fighting a much more radical and less achievable battle.

    Incidentally, there are two possible perverse incentives – the incentive to do too much, but also, the incentive to do too little. Most people would regard the latter as worse.

    Contrary to what may be your assumptions, the latter is inherent in the US system (ironically, perhaps more so than in the Canadian system). Insurers constantly seek to deny coverage for a wide range of things. That is actually rational for them, as private insurance payers.

    The most regressive system, and one that insurers not only would love, but in fact already to some degree have in place, would be flat rate maximum per patient, but with private insurance.

    In fact, somewhat contrary to your assumption about fee for service, very sick insured patients routinely run out of health insurance (they are either directly told that they have reached a limit or told that they must may extremely high premium payments, that they can’t afford, to continue the insurance). This basically means that there will be a scramble to get the patient on low-paying Medicaid if possible; meanwhile, the patient is “self-pay”, health care personnel, the non-profit institution, and the taxpayers eat the cost of treatment, and the patient goes bankrupt (in fact, most patients who go bankrupt due to medical bills started with private insurance). Yet, economic disincentive to provide fee-for-service medicine notwithstanding, such patients are treated.

    No system of health care coverage is perfect.

    The US seems to have the worst among developed nations.

    Our unique features are lack of true universal coverage and, although many other nations have private health insurers, massive reliance on private insurance.

    Why don’t we try to make ourselves as good as others first, and then worry about more extreme ideas later, if we still want to?

  17. #17 John Mack
    March 6, 2012

    As long as there is a requirement to treat all patients whop show up at a hospital, the market system cannot reduce the costs of medical care.

    Libertarians and ultra conservatives do not want the insured to to be treated at all, or keep touting that they can go to a hospital and get full treatment. Hospital treatment is far more expensive than routine treatment. For instance, while uninsured for two weeks, years ago on Christmas Eve I was forced to go to a hospital for a bursitis attack in both shoulders that left me unable to do anything and in great pain. Normally, at that time, I would go to a walk-in clinic, pay $25 dollars, get a cortisone shot, and be fine a half hour later. At the hospital, after waiting three hours, I fainted from the pain. This immediately required all sorts of expensive tests before the doctors determined that I had a bursitis attack and needed a shot of cortisone. I ended up getting a bill for $936 that would normally cost me $25 (I paid myself). All the costs have gone up since then.

    Emergency room doctors often order expensive tests because they want to reduce liability from lawsuits for malpractice. These law suits are often initiated by professional con men who travel form one emergency room to another and know how to fake dire conditions. No matter what the doctors do, the con men find a way to sue for big money.

    Liberals and most moderates want a single payer system, such as they have in Canada, or a controlled universal insurance system such as they have in the Netherlands. But in the USA medical care is treated as a commodity to be bought and sold, with insurance companies mandated to “maximize shareholder value,” that is, to charge as much as possible and pay out as little as possible.

    Americans cannot reform the health care system because the insurance companies, and the far right, have a veto power over any serious reform.

  18. #18 Wow
    March 6, 2012

    As long as there’s no requirement to treat everyone who turns up, the market will not reduce the cost of healthcare either.

    Why? Look at insurers. They’ll try every trick to avoid paying out or paying less, because you want to take in premiums because that’s your profit, but you don’t want to pay out on them because that’s your loss.

    Therefore they’ll just skim the higher bracket and profitable people and operations and refuse any that don’t give the best ROI.

    Look at the discussion on the lack of GPs which generate less revenue/profit than a specialist.

    There are many things the market cannot optimise because we’re not allowed to hang the b*rds for being mean. Not that we ought to be able to, mind, but it indicates the complete lack of consequence for misanthropy, compared to the benefits. Crime pays, and the hours are good.

  19. #19 Wow
    March 6, 2012

    “but also, the incentive to do too little. Most people would regard the latter as worse.”

    Hippocratic oath: do no harm.

    But when you’re paying $1500 a month, you’re going to want $2000 worth of treatment in a month, or “spongers” will be getting “free medical treatment” off you. Most patients therefore would regard the latter as worse. Most people paying in would regard it as better, and the doctors would tend to agree, or at the least have a very different view of “too little”.

  20. #20 harold
    March 6, 2012

    It seems to me that GPs should be paid more than specialists because they are in short supply and their job is harder due to the greater breadth of knowledge required.

    Most specialists start by training in a primary specialty, and then do additional training.

    For example, either a general internist or a cardiologist is competent to diagnose and manage mild hypertension. But a cardiologist is usually far more competent to diagnose and manage complex cardiac diseases. Every doctor is going to be more efficient at what he does most often, but the cardiologist has additional training, not different training.

    Also, radiology, pathology, surgery, neurosurgery, for example, all have their own residency systems. They are all ultimately every bit as necessary for a modern health care system as family practice. Are they “primary care”? Even a family practice clinic serving a young, healthy patient base is going to need labs, radiology, or surgery consults fairly frequently.

    From my observations in Norway, England and Italy, the clinics and hospitals are spartan but adequate.

    Wisconsin is even closer to Canada, culturally and geographically (high Norwegian-American population notwithstanding); you might want to take a look at the Canadian system.

    The reason I say this is that Canada has better public health statistics, better public and physician satisfaction, and substantially lower costs.

    Yet Canada has not made radical cultural changes in medicine, relative to the US. Canadian clinics and hospitals are not shockingly “spartan”. The Canadian system has some medically appropriate efficiencies (I noticed once when someone I know in Canada had a biopsy that negative pathology reports seemed to be batched rather than transcribed one at a time), but it is highly similar to the American system. Neurosurgeons do make more money than family practitioners in Canada.

    Why can’t we just try to achieve a system that is at least as good as the Canadian system first, and then worry about more extreme changes later, if we still want them?

    When the most glaring issues that make the US different from other rich democracies are obvious – large uninsured population and high reliance on for-profit insurers who frequently dump the highest cost patients on the taxpayer – and when the US already has a quasi-universal system that could be expanded – why not focus on those problems, and look nearby at a system that has eliminated them?

  21. #21 harold
    March 6, 2012

    WoW –

    “but also, the incentive to do too little. Most people would regard the latter as worse.”

    Hippocratic oath: do no harm.

    I already said that I believe that physicians are good at resisting both perverse incentives. My points were, and I thought, perhaps mistakenly, that they were clear, that 1) fee for service is not unique to the US and therefore cannot necessarily be blamed for our unique problems and 2) lack of fee for service does not necessarily mean lack of perverse incentives.

    I agreed 100% with your other comment.

  22. #22 MarkH
    March 6, 2012

    I was too nonspecific in my complaints about fee-for-service.

    I said:

    We have to end fee-for-service reimbursement systems that create incentives for hospitals to generate revenue by pushing more procedures, more tests, and more expensive utilization of resources. One thing that Atul Gawande got correct was that when physicians were salaried independent of their revenue-generation for the hospital, as at Mayo, costs go down. When incentives are created for physicians to generate more revenue for the hospital, physicians will generate more revenue for the hospital.

    To some degree, yes, most systems are based on reimbursement for service rendered. This makes sense. And my suggestion wasn’t to eliminate fee-for-service as a whole. The problem is the physicians are incorporated into the incentive scheme. When physicians are compensated based upon their revenue generation from the hospital I see a potential ethical conflict there, as well as a perverse incentive system. Worse, decisions about tenure or retention are generated based on RVUs, so some physicians have a revenue-generation incentive to keep their jobs.

    In the US we order more CT’s than any other country, we order more expensive tests, and we have greater expenditures on ambulatory surgery centers (see the McKinsey report). If a physician spends time with a patient, say 30 minutes, they may be reimbursed 80 dollars. If they then send that patient to their testing facility for an MRI (which takes none of their time) they may get “professional fees” (read kickback) of $500, and if they profit share in their practice with their imaging center then they have even more to profit from ordering unnecessary tests. In the hospital tests are revenue, there is no disincentive to ordering more tests, more procedures, and guess what, when you look at the data the US orders more CTs or MRIs than other countries.

    We may not be able to eliminate fee for service as it is just a fundamental capitalist kind of thing. I do something for you, you pay me, or your insurer does. It makes sense. However, the decision on whether that service is necessary, which is where the physicians are the gatekeepers, is where the difference should be made. If the incentive is for the physician to generate revenue, if they are paid based on revenue generation, they will generate more revenue. And it won’t even be an outright conscious decision on their part. When they are weighing the costs and benefits of a procedure, efficient use of healthcare resources will be less of a component, because they don’t see a downside from overuse except in a very abstract way.

    The other downside of the fee-for-service system is that the administrative costs are ridiculously high. We spend 96 billion more on medical administration than we should compared to the other industrialized countries described in the report. All that staff submitting forms for reimbursement, those decisions being challenged (not necessarily for good reasons), doctors having to waste time arguing about reimbursement etc., it’s costly. And it tends to fall heaviest on the general practitioners, rural docs, and docs serving the underserved and poorest populations. Docs operating in the large practices and hospitals with administrators to fight those battles for them are isolated from the battles for reimbursement, so those with the incentives to order excess testing don’t even see the negative consequence since they’ve got staff for that.

    In terms of adopting Canada’s system I say, no way. I don’t think single-payer is the way to go. Surveys of countries with single-payer versus other systems with regulated health insurance or health funds show single payers do worse for access, worse for patient satisfaction, and an excess of delay in delivery of care. I would prefer the systems of the Netherlands, or Germany, or France. Basically health insurance or health funds, tied to employment, tightly regulated, with subsidization for the poor to get access to care. They have the highest satisfaction (for both patients and docs), best access, and still cost less than 1/2 per capita as our system.

    In terms of controlling costs, sure, Canada’s system does so, but I don’t think it’s the best system. In terms of reigning in costs in our system I think the most important aspect, besides providing universality, will be restructuring the incentives for physicians away from RVUs (a medicare metric!) and towards metrics that factor in efficiency. A side-note, it should not be tied to outcomes as all that does is punish physicians that take care of the elderly and the poor.

  23. #23 harold
    March 6, 2012

    In terms of controlling costs, sure, Canada’s system does so, but I don’t think it’s the best system.

    That is true, and I don’t have major disagreements with anything you are saying.

    My focus is pragmatic.

    Major cultural changes are unlikely to happen quickly.

    Achieving the ideal eventually need not be the enemy of strong positive change right now.

    Making Medicare voluntarily available to all citizens, at current reimbursement rates with appropriate provisions for keeping reimbursement rates reasonable, would not be perfect, but it would be relatively easy, solve many current problems, and actually set the stage for future improvements, as removing current private insurers would remove the major impediment to rational dialogue (which is lobbying by the private insurance industry and some of their allies).

    For people bankrupted by medical bills or unable to afford medical care, the time for a positive step is now. That’s why I support starting with an easy step that would not cause much disruption for patients or physicians.

    Although I am, in fact, a pathologist by training, and have been out of practice doing start up businesses for the last few years, my logic here is somewhat analogous to triage. Stabilize first, perfect later.

    My support for a rapid introduction of universal coverage in a reasonable, relatively (that’s relatively) easily achievable way does not imply opposition to continued rational reform in the future.

  24. #24 Wow
    March 6, 2012

    “I already said that I believe that physicians are good at resisting both perverse incentives.”

    However, like programmers during the dotcom boom, there are people taking a medical degree because it will pay best. They didn’t appear for reasons of helping, even if they’re the minority. And as MarkH points out, there’s incentive for hospitals etc to employ the ones who generate more work, especially unnecessary work.

    Add “the customer is always right”, CYA and a faith in the market to sort out the bigger picture, and there are many practitioners who will prescribe unnecessary procedures to get a quiet life.

    One way in which home visits may have worked is to break that cycle of the patient thinking they’re *owed*.

    1) The visit is something they’re getting for their money from their view

    2) The doctor and patient meeting more often means the patient will trust the doctor more

    3) Meeting the patient, the doctor will feel they ought to take the time to build that trust, since this is now someone they know genuinely

    Therefore unnecessary work is avoided because neither side want to feel they’re CYAing themselves.

    If the patient only visits the doctor, if it’s for a checkup, it’s now an imposition. If it’s because of a problem, then the patient starts off wanting a solution and won’t take no for an answer. In both cases, the doctor feels they are the adversary and reacts accordingly, and the patient feels they’ve already met the doctor half way or more.

  25. #25 Wow
    March 6, 2012

    “Major cultural changes are unlikely to happen quickly.”

    Alternatively (have you read any Terry Pratchett? Try “Making Money” for a fuller explanation), if you change things quickly enough, the new becomes old before anyone notices and the change goes through easier.

    Look at the rush through of PATRIOT for example. It wasn’t rushed because they needed the powers then, but to make it old as soon as possible, therefore no news.

    Additionally, slow change would mean slow results, therefore free market fundamentalists would state this is because of the free market working, not the changes in what government does.

    You may be right, but there’s plenty of reason to try a sea change. And a trump one is the lives saved and happiness increased by changing now and radically.

  26. #26 harold
    March 6, 2012

    To some degree I’ve gone very mildly off topic here, as your post focuses exclusively on the cost advantages of a universal coverage system.

    Although I think it’s clear that making Medicare universal would have cost advantages, it’s also true that I support that suggestion largely out of concern for the plight of the currently uninsured and a desire to fix problems like medical bankruptcy and lack of access to care at the non-emergency level in a reasonable time frame. In short, I am also arguing from motivations that are not directly cost related.

  27. #27 harold
    March 6, 2012

    Mark H. and WoW –

    I’m going to have to cut this off now, but this has been a remarkably rational, fact-based discussion.

    Normally, a discussion about universal health coverage is interrupted by ill-informed people repeating propaganda slogans, and tends to degenerate into correction of absurd, factually incorrect arguments against the very concept of any universal coverage.

    One thing that emerges here is that even among those of us who strongly support universal coverage, there is a diversity of opinion about the best way to proceed. That is appropriate and valuable. But we do need to be sure that we don’t allow diversity of opinion to paralyze us from moving forward toward universal coverage.

  28. #28 MarkH
    March 6, 2012

    As a parting shot harold read about healthcare in the Netherlands.

    In terms of ease of implementation, it’s the system closest towards ours now. They describe it as “private health insurance with social conditions”. It’s also 1/3rd the cost of ours, cheaper than Canada’s, and is more or less based on a similar private insurance system. They’ve just layered on provisions against discriminating against preexisting conditions (sound familiar?) and actually encourage coverage of chronic conditions due to their incentive structure.

  29. #29 harold
    March 6, 2012

    MarkH –

    I will, and many thanks for the link. I try to keep up with health care systems.

    I assure that 1) if we could go to a system like their theirs tomorrow, I would support that, 2) if it was a choice between Canadian and Dutch systems, it is highly probable that I would support the Dutch system, and 3) I already regard the Netherlands as a great model of much rational social policy that the US should consider emulating, on other levels.

  30. #30 Wow
    March 6, 2012

    “In short, I am also arguing from motivations that are not directly cost related.”

    Me neither. Quote: And a trump one is the lives saved and happiness increased by changing now and radically.

    But even those who decry “spongers” are ensuring that the sponging is both necessary and more expensive are their own worst enemy. Pointing this out is to appeal to their greed since in many cases the greed is a Randian “Devil Take The Hindmost” sort of prime directive. They genuinely don’t care (compared to their personal position) about other people.

    But that more expensive and more necessary procedure is because the patient denied care otherwise is in a critical condition and a life is at stake.

    To the patient concerned, this is a huge problem unconnected to the cost.

    As fellow human beings, it is too.

    And pointing out the cost savings in addition to the humanitarian issues makes it the “win-win” proposition that is hard to understand the resistance to.

  31. #31 Antonio Lorusso
    March 6, 2012

    AL@6: No argument.
    Wow: Ignored my “except in defense of aggression”, so your argument straw mans my argument
    MarkH: Completely ignored that if you disobey a law force is used, which straw mans my argument. See my repsonse to Wow if you feel like responding with what about thiefs and murderers.

    So a non-argument and 2 straw man arguments. If I missed any replies, apologies.

    Universal Health care if implemented by government will be implemented by force. If you are advocating that don’t dignify this by calling it a debate or a discussion. It’s armed robbery given with veneer of good intentions. After all if someone sticks a gun in your side and demands money, you won’t care what they say they will do with it. All you’ll care about is that they forced you.

  32. #32 harold
    March 6, 2012

    Universal Health care if implemented by government will be implemented by force.

    In the absurd sense that any law is implemented by force.

    If you are advocating that don’t dignify this by calling it a debate or a discussion.

    You seem to have the impression that you can demand that the definition of English words be changed.

    I find that this is all that “libertarianism” amounts to.

    It’s actually nothing but an impotent attempt at linguistic authoritarianism.

    What is going on here, between the adults, is a “discussion or debate”. It actually would be so even if one of us were advocating absolute monarchy or some such thing. We’d still be discussing and debating.

    It’s armed robbery

    See, there you go again, trying to unilaterally change the meaning of words. “Armed robbery” does not mean what you are pretending to think it means.

    given with veneer of good intentions. After all if someone sticks a gun in your side and demands money, you won’t care what they say they will do with it. All you’ll care about is that they forced you.

    1) Attempting to force everyone to change the meaning of common words and phrases does not make you look clever or principled.

    2) You example isn’t even true.

    The United States already has unofficially universal health care; no-one is emergency care. We are discussing making it better.

    If you were sincere about your “principles”, you would have moved to Somalia a long time ago.

  33. #33 Wow
    March 7, 2012

    “You seem to have the impression that you can demand that the definition of English words be changed.”

    And he probably wants to force us to comply, for extra irony…

    “Wow: Ignored my “except in defense of aggression””

    Define aggression. Refusal to do what you agreed to do is aggression against the society that agreed the rules. And you ignored any need to actually say WHY that was allowed.

    Why is it allowed to use force against someone being aggressive?

  34. #34 Antonio Lorusso
    March 7, 2012

    Harold,

    Universal Healthcare by Government laws which is what’s being proposed (and what I was clearly discussing, another straw-man against my argument)

    Laws are not recommendations, or suggestions. They don’t advise. They say “Do this, or there will be consequences for which we will use force. Even if you were not doing anything to harming anybody, we’ll force you to do this anyway”. A point you are avoiding.

  35. #35 Wow
    March 8, 2012

    “Universal Healthcare by Government laws which is what’s being proposed”

    What about them? They don’t want to force you at gunpoint to go to your doctor.

    “They say “Do this, or there will be consequences for which we will use force.””

    Yup. And if I were to invade your house at night, there would be consequences for which you will use force.

    “Even if you were not doing anything to harming anybody”

    And how is going to the doctor harming someone?

  36. #36 Garm
    March 8, 2012

    Laws, in a democratic country, arise from a majority agreement to pass said law. By residing, and choosing to remain in said country, you’ve implicitly agreed to honor its majority decisions. You do at all times have the right to leave if you wish to dissolve said agreement. There are no “I’m special” opt-outs for individuals who just decide they don’t won’t to play by the agreed rules.

    If everyone got to opt out of any laws they didn’t personally agree with, you’d have no recourse when someone decided that beating/killing/robbing you were justified.

    Anyway, the WSJ had an interesting article on health care costs, which showed that American health care costs have ballooned so far that an American citizen pays _more in taxes for government health care_ than a Swede, Brit, Japanese, Canadian etc.

  37. #37 Wow
    March 8, 2012

    “There are no “I’m special” opt-outs for individuals who just decide they don’t won’t to play by the agreed rules.”

    Well, unfortunately, it’s more “there should be no special opt-outs”. If you’re wealthy enough, you do get a privilege.

    This, however, is what Larousso is aiming for: rapine until he’s wealthy enough to afford privilege the peons aren’t allowed (note: they’re called peons because of what the rich do on them).

  38. #38 MarkH
    March 8, 2012

    You guys are arguing with cranks again. You might as well argue with the spam bots. If someone doesn’t even accept the validity of our system of republican governance, why argue with them? Hopefully they’ll just move out to the middle of nowhere and stockpile guns in someplace without an internet connection.

  39. #39 Wow
    March 8, 2012

    It would still be interesting to know why it’s OK to call the cops on someone but bad for government to use force on anyone, and how going to the doctor is harming people…

  40. #40 Kevin
    March 9, 2012

    I haven’t read every comment exhaustively, but one point that is crucial to this conversation is the capitalistic approach that dictates that a profit be made at every single step of any medical “encounter.” For example, charging patients $20 for a “mucus retrieval system” (tissue) is guaranteed to drive costs up. And while we discuss morality, is it moral for any entity to make a profit on my health care? I am HAPPY to pay for the facility, the facility’s overhead, the doctor’s expertise, nursing care, MRIs, etc. I am not happy to contribute to the wealth of an investor who sees my health as a profit opportunity.

  41. #41 Extremejor
    March 12, 2012

    1. Everyone pays for healthcare.
    2. They are encouraged to enjoy the benefit of regular preventative care
    3. They get sick, they stop paying.

    Therefore, the incentive is to keep the population healthy or u don’t get paid.

    Yes, it’s a bit simplistic, but, it’s a start.

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