Press "Enter" to skip to content

ABQ Journal Online Health Care Reform Debate

So, I’m a little late to the table due to travel schedule, but I was invited to participate in the ABQ Journal’s Online Health Care Reform Debate. I just submitted my response this morning to yesterday’s question. I’m also cross posting it below, but I’d encourage you to hop over to the Journal and read what the other panelists had to say.

What is the ideal way to expand coverage and cut costs in our health care system?

Let’s look at the basic problem with this question. First, it is a contradiction. You can’t expand coverage and cut costs. You can do one or the other, but it is not possible to do both at least not without degrading the quality of available care.

Moreover, it’s a classic example of a one-size fits all type of question. The thing is that there in not a one-size fits all type of answer. In many cases the costs of health care are directly tied to the malpractice insurance doctors are required to carry as a result of lawsuits – some frivolous, some not. In other cases the rising costs of healthcare are the result of government regulation and mandates intended to reform the system or protect consumers. Then, there is the subjective nature inherent to providing “health insurance that covers all medically necessary care.” To a family, it might seem that no expense should be spared to keep a loved one alive, but is it really society’s responsibility to pay for that care? I would argue it is not.

Let’s also examine the question of expansion of health care coverage. If someone smokes two packs of cigarettes a day, do they deserve the same access to health care and level of care as someone who does not? If someone chooses to live a rural lifestyle is it really the responsibility of society to build them rural health centers. If you choose to get cable television and a cell phone instead of paying for health insurance, should everyone else chip in to pay for your insurance. Again, I would argue not.

So, let’s look at the latter first. The best way to cut costs in the health care system is on a case be case basis on the local level. Looking at the individual costs, be they hospital, doctor or individual, and coming up with solutions to reduce those costs. And, acknowledging that cutting those costs may very well involve making tough decisions about the type of health care services that will be made available. Incidentally, this is also the trick to expanding coverage. Get away from trying to provide the same level of coverage to everyone, everywhere. Health care is a service it is not a fundamental guaranteed right. Any more than than we should guarantee equal types of housing to everyone in America.

Does the current focus on costs undermine the importance of quality of care, as discussed in Win Quigley’s article on Sunday?

Without moving to a barter system there is absolutely no way to separate costs from quality as it relates to health care. The two are inherently tied together. In our form of society the quality of every service or product purchased is related to price paid, up to the point of diminishing returns. Shifting to a government run health care system only shifts those costs from one entity to another (i.e. business-to-consumer to government-to-consumer).

It is the demand for quality and quantity of care that is causing escalating costs. In a government run system the costs will only increase not decrease. In fact, I challenge you to find any government run program where costs do not increase year over year. They don’t exist. Medicare, public education, public housing… pick a program and the costs always increase.

Anyone who has ever worked inside a government funded institution understands why. Government run programs have no incentive to cut costs. Quite the contrary, they are incentivized to spend every last dollar in order ensure that they can receive the same level of funding the next year. This makes it all the more ludicrous for government to try and devise solutions for cutting costs. It’s like asking a vegetarian what’s the best way to cook a steak.

How can we change the incentive structure that leads to the use of expensive procedures that may not lead to optimal health outcomes?

There is only one way to significantly do this and that is at the consumer level. Something along the lines of health savings plans wherein individual consumer choices regarding the quality, quantity and type of care they receive directly impacts the dollars in their pocket. Also, I believe that consumers should indemnify medical providers, so that we remove the burdensome costs malpractice has introduced into the system.

And, finally, what proposals or ideas in Congress strike you as smart and feasible?

All of the proposals in Congress are feasible. Feasible in that they can be implemented. However, implementing a program is never the same as achieving a goal. I’m not aware of a single smart proposal in Congress. Anything Congress passes is going to be a one size fit all approach for the nation, and that is a mistake, a very costly and ineffective mistake made time and time again.