• The greatest challenge, the talk (HIE version)

    Below are links to the slides for the talk I’m giving to undergraduates at Princeton’s Woodrow Wilson School soon. It’s called “The Greatest Challenge: The US health care crisis and the lessons of a unique experiment.” And, by “greatest challenge” I really mean greatest domestic policy challenge. The greatest challenge globally is the climate change problem.

    The talk is in two parts, with a few slides that transition between them: (1) the health care cost crisis and (2) what the RAND health insurance experiment (HIE) tells us about what can be done about it. Note that part 2 doesn’t by itself lead us to anything like a full solution to the problems described in part 1. That’s why this is the HIE version of the talk. Other versions I might create later would add more to the story. For example, I might produce other talks with different back-ends, swapping out (or adding to) the HIE stuff with something on cost shifting, the balance of hospital and insurer market power, the implications of Medicaid expansion and the Cadillac tax, or Medicare private plan payment policy, all things that relate directly to my research.

    Those would all be more advanced talks. This HIE one would be appropriate for a lay audience, advanced undergrads, or junior graduate students interested in public policy. Anyone deeply steeped in health policy or economics would be bored, though might like the figures (there are lots).

    Click here for PDF-version of slides

    Click here for Power Point version of slides

    Are you interested in this talk at your institution or community organization? Do you want to swipe any of this for use on your blog? If so, go ahead and use the slides in any way you like. Just tell your audience where they came from and about this blog and I’ll be happy. Or don’t and I may never know, but you’ll suffer the bad karma. You can also contact me if you want me to speak or need a direct quote. I can’t promise to make every offered speaking engagement, but in a world with infinite resources or in which I had a dedicated stream of funding for this sort of thing I would. Boston area talks would be relatively easier for me to do.

    Please also let me know in the comments about anything that occurs to you that might improve the slides. Keep in mind, however, that the point is to introduce the health care cost problem and summarize the most influential study relevant to it in 45-60 minutes. It is not a talk about everything pertaining to health care or health care costs. The meta meme is to convince people that research and evidence are relevant to policy. I’m just promoting what I do. The motivating question for me in preparing these slides was: if students were to know one or two things about health policy and relevant research, what would it be?

    What you cannot tell from the slides is what I will say. The Power Point document has embedded notes, mostly taken from blog posts. Another way to get some additional info on some of what I’d say is to read those posts. They’re all listed with links below. Unless indicated otherwise, I’m the author. The list is roughly in the order in which relevant slides appear in the talk.

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    • I think I see how this will go and should make for an excellent presentation, especially if they are sophisticated about general economic issues. Just couple thoughts.

      1) I am a bit surprised 9time constraints?) that you did not include either Gawande or the Dartmouth group studies. I think that would point out that it is possible even in the US to provide quality care at much lower prices than we are paying now. That utilization is extremely variable.

      2) Maybe a slide comparing our costs with those around the world? You cover that indirectly early.

      3) Ezra Klein, IIRC, had some charts last year on costs. I believe they showed that payments for procedures in OECD countries run about the same as payments by Medicare in our country.

      4) Any utility in adding in historical info? While we are all in a tizzy about Medicare/Medicaid and debt now, it would be good, I believe to remember what things were like without these programs. What was it like before we had medical insurance and is it possible to run a first world system without it?

      5) Should you address rationing? The idea that we currently ration by price?

      These are all very minor quibbles that I suspect you just dont have time for or may not fit well with what you are actually going to say.

      • @steve – Thanks. You’re right that I can’t do everything in the talk. However, I don’t mind jamming in more slides in the document and then skipping some when I actually speak. If you could point to specific figures (provide URLs) that’ll make it far more likely I’ll include your ideas. Otherwise, sometime down the road when I stumble on something suitable, I’ll throw it in. (I’m not going to proactively chase things down now because I don’t have time.)

        Also I’m just jumping in to insert a note sent to me by a reader. I might consider including one of Aaron’s pie charts that shows how the extra spending is distributed across different pathways. Each of his posts in his current series on why health care is so expensive concludes with one. [Later: I added this figure (10/1/10)]

    • OT- I was reading Josh Barro’s response to spending cuts suggested by the CAP. The following paragraph made me think.

      “The report notes that the recently passed health care law already includes significant reductions in Medicare reimbursement rates. That’s true, and as the authors note, further reductions in reimbursement rates could make it difficult for seniors to receive care, because doctors will take fewer Medicare patients.”

      I found this interesting since many people seem to think that Medicare acts as a price support, but if Medicare rates go down, then private rates should also go down and we maintain some kind of equilibrium. Docs should see the same number of Medicare patients. I think this undercuts the price support idea.

      Barro goes on to make a strong pitch for competitive pricing with MA, which you might be interested in.

      http://www.realclearmarkets.com/articles/2010/09/28/what_cutting_the_federal_budget_entails_98692.html

      Steve

    • Nice presentation and good luck.

      The counter-argument you’re going to get against the “discouraging findings” slide on RAND is that those negative effects have been adjusted for by including preventive services in newer plans with more cost-sharing.

      As we’ve discussed before, I’m sort of skeptical of these plans per some research (http://content.healthaffairs.org/cgi/content/full/25/6/1529) showing that employers who switched to CDHP plans with high cost-sharing that covered preventive services did NOT see an increase in preventive services.

      Also, minor quibble that these days when I see “HIE,” I’m expecting to read an article about the Health Information Exchanges in ACA. Maybe worth making the distinction.

    • Here is the link to one of the Klein chart compilations. They supposedly come from Kaiser’s Halvorson.

      http://voices.washingtonpost.com/ezra-klein/2009/11/an_insurance_industry_ceo_expl.html

      Steve

    • Austin
      I give a similar talk, mostly to physician and hospital folks. A slide that would be helpful, and a concept that is often misuderstood, is the provider (hospital/doc) and insurer dynamic.

      Because of all the demonization of MCOs, many are unaware of their low profit margins, the dominance of hospitals and docs in achieving desired rates, and the fact that MCOs are controlling a minority slice of the dollars (exluding state, feds, TPA function).

      Brad

    • If you want to talk about private vs Medicare costs, I find this one interesting. It also has a chart showing how quality hospitals can function at Medicare rates.

      http://voices.washingtonpost.com/ezra-klein/2009/07/does_medicare_pay_below_cost_w.html

      Steve