Sunday, March 21, 2010

Health care legislation

It appears that the massive health care legislation is set to pass, after much fuss and bother. Only in America would it come down to fetuses in the end.

It might surprise some readers that I actually support (inexpensive) universal coverage. We have already made a decision that we will not let people, or rather US citizens, go without certain types of health care. Such uncompensated care is paid for by the government or is socialized via the higher private insurance premiums that result from some people going bankrupt or otherwise not paying. Given that we have made this decision, one which I do not, at a general level, disagree with, we should do so in a thoughtful, organized and evidence-based way, rather than in the current dishonest, piecemeal and silly way. Requiring people to buy health insurance makes sense for the same reason that requiring them to buy auto insurance does: if you do not, some people will not buy it but will get into accidents anyway. For reasons beyond the scope of this post I think it makes more sense to require the purchase of a minimal private health insurance plan, with a subsidy for those who cannot afford to do so, than to institute a single payer or a completely government run system. Indeed, a serious reform would have replaced both Medicare and Medicaid with exactly this. I would then have the government define the minimal insurance package by setting an affordable dollar value and having a panel of health care experts and economists figure out what to buy with it. If people wanted more insurance, they could of course buy policies that provided more coverage than the government minimum with their own funds. Simple and easy. And there is no need for it to add, on net, to the deficit, if accompanied by, for example, the removal of the part of the Medicare Part D donut that (insanely) provides first dollar coverage of prescriptions, by the ending of the tax subsidy for health insurance and/or by setting the dollar value of the basic plan below current Medicare levels.

What is in the process of being passed now is very much not a thoughtful, or reasonable or evidence-based way to obtain universal coverage without busting the budget. If reform means making things better then it is not reform, and it is certainly not any sort of great progressive victory. It is an insurance purchase requirement, which may not even last through the courts, a whole bunch of spending, a whole bunch of unfunded mandates to the states, a whole bunch of changes to what insurance companies can do that will raise premiums, some implicit transfers from the young to the relatively old via the design of the subsidies, and some other assorted bits. It is not about cost-control nor about using evidence to guide what gets paid for nor about fixing the welfare reducing inefficiencies in the present system, such as the tax subsidy to health insurance. The only positive thing one can say is that it probably will not directly reduce innovation in the health sector, which some of the proposals on the table at various points likely would have. It may, of course, reduce economic growth via tax increases at the state and federal levels and thus reduce innovation indirectly. On the other hand, because the scheme essentially represents a subsidy to health care demand, it could even increase innovation.

Moreover, the whole process leading up to the vote today has been rife with lies by those advocating for the policy. Those lies include the fake future Medicare cuts included in the legislation to make the budget scoring look good and, more generally, pretty much all claims about cost-cutting. There was also a lot of lying about Americans without health care, when in fact what there are is Americans without health insurance. In most cases, though not all, these are not the same. There were also a lot of ridiculous claims about the likely effects of the reform on health outcomes and on bankruptcies. Americans are sick because they smoke, eat both too much and the wrong things and rarely exercise, not, in the main, because they lack health insurance. Similarly, Americans, again in the main, go bankrupt because they are irresponsible with credit, not because they get sick.

At the same time, the Republicans performed completely disreputably as well. The three aspects of the proposal they went after: the requirement to purchase insurance, the "death panels" designed to bring some evidence to bear on what gets covered and the cuts to medicare, are or were, before they were cut out, the good bits, not the bad ones. And, really, prating on about socialism while defending Medicare in its present form and after passing Medicare Part D under Bush II, let alone after starting two voluntary wars, is pretty rich, and pretty ridiculous.

The whole lot of them, Democrats and Republicans, ought to resign in shame. This is a debacle on the order of the Iraq War or Medicare Part D or, going back into the distant past, on the order of Prohibition or of setting up Social Security as a pay-as-you-go system rather than a forced savings system. The public will continue to bear this burden long after the current crop of congressional ideologues, hucksters, morons and sleazebags is gone from the scene.

Some related thoughts from Megan McArdle at the Atlantic.


Seabreeze said...

In-temperateness has its virtues.

Scott said...

Would you prefer catastrophic care paid by the government. Something like McArdle's preferred paying all of the medical bills above 15-20% or income?

econjeff said...

I would prefer something like Megan's idea but there also has to be some way of saying ex ante that there are things the government will not cover, but that people can by with their own money or own insurance if they have the means to.