Cost Versus Access

I’ve said again and again that the PPACA is about access.  That shouldn’t be surprising, given the focus that the Democratic party has had on covering the uninsured for decades.  In order to increase access, the PPACA had to raise a significant amount of money (because costs go up) and infrastructure.  Those who support PPACA have been attacked for these costs and bureaucracy.

With me so far?

After years of claiming that they would achieve similar goals while also cutting costs, the Republicans seem to be orienting more towards reality.  They are now claiming to focus on costs:

In fact, there is no House Republican plan yet, but the broad outlines of a GOP plan are becoming visible. The goals given to four committees drafting the plan suggest that Republicans will lean heavily on old GOP standbys, like cutting costs through medical malpractice reform, using small-business purchasing agreements to lower premium costs and putting patients with preexisting conditions into high-risk coverage pools.

Let me be clear – I applaud those who stake out a claim and defend it.  If you think that we should focus on costs first, that’s not crazy.  I disagree, but that’s at least rational.

But just as I allow for those who argue against the PPACA for legitimate reasons, you should be prepared to hear my critiques of other plans.  And if this is what the Republicans are planning, I will have a lot to say.

First of all, I have no problem with reforming the malpractice system.  But tort reforms capping damages has been estimated to reduce health care spending by $54 billion over a decade.  That’s less than $6 billion a year. That is chump change.  If that’s the best they can do, there’s no hope.  It doesn’t work.  Don’t believe in the defensive medicine hype either.  Research has shown that significant tort reform might change reduce defensive medicine by 0.1%.

Small business purchasing agreements:

In a 2008 analysis, the CBO said the idea would extend coverage to about 600,000 people who would have been uninsured otherwise, and it would make health insurance cheaper for other small business workers who already had coverage. But the budget office also found that it would make coverage more expensive for people who stayed in more regulated health plans, because most of the people who join association health plans would be healthy people with low medical costs.

There’s that adverse selection problem.  It’s easy to make health insurance cheap for healthy people.  You can do that.  But many people don’t think that’s what we should be trying to do.

And high-risk coverage pools?  Haven’t we been hearing about how those don’t work and are too expensive?  You have.  They are.

If Republicans were serious about cutting costs from the health care system, they would look for ways to reduce Medicare expenditures on the order of hundreds of billions of dollars.  They would keep the cuts that PPACA made, for instance.  They would try and reduce the prices of drugs and devices.  They would look for new ways to make care cost less.

They wouldn’t try and find a few billion in savings, cover a few million more healthy people, and offer a solution for the sick that they know doesn’t work well.  If that’s the best they have to offer, they should prepare for some criticism.

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