Does Brill really make a case against single payer?

David Frum thinks so:

Unfortunately Brill’s piece is also inspiring more comment that the only solution is to extend Medicare to all: single-payer.

Yet Brill himself along the way shows why this would be a bad idea. More than 3 million bills arrive at Medicare every day. How are reimbursement rates determined?

A panel of doctors set up by the American Medical Association reviews the codes annually and recommends updates to Medicare. The process can get messy as the doctors fight over which procedures in which specialties take more time and expertise or are worth relatively more. Medicare typically accepts most of the panel’s recommendation.

This method can work within the context of a private market. A price level exists “out there.” Medicare and its panel can argue over how much to discount. But if there were no private market “out there,” Medicare would stumble into the plight of the Soviet planning authorities. Any price would just be a guess, producing either windfalls or shortages. US Medicare works better than Britain’s NHS or Canadian Medicare precisely because it is informed by private price-setting.

I’m not sure Frum is correct here. If he were, then single-payer systems would be failing all over the place, and France seems to be doing just fine. Canada is, too, but I wanted to throw you off there.

What I believe Frum is alluding to is that if we had a single-payer system, the pressure from government would be to push reimbursement so low that the system would starve, and begin to suck. First of all, I’d argue that quality ain’t so hot already. But I think the more important point is that we – as a nation – seem unwilling to squeeze the health care system at all. Medicare hasn’t said “no” enough. We just don’t do that.

Frum then goes on to cite his and Brill’s ideas about reform:

1) Tighten antitrust laws for hospital companies so none can become regionally dominant;

2) Tax hospital profits and non-doctor hospital salaries at confiscatory rates;

3) Outlaw the charge master – the hospitals’ outrageous list prices;

4) Control prescription drug prices;

5) Medical malpractice reform.

Point 3 however seems weird and counter-productive. Wouldn’t the first steps to reform be to a) require every hospital to publish its charge master price list and b) make conveniently available Medicare’s discounted price?

A patient presented with a big bill could then, at a minimum, readily compute the Medicare price and have a better basis for complaint and negotiation. Some patients would shop beforehand. Ideally, brighter publicity would exert downward pressure on prices in general.

I already touched on 5. Frum doesn’t like 3. He wants to go more consumer directed. I also already touched on that, too.

This argument baffles me. Brill’s kajillion word opus focused almost entirely on how the prices are the problem. It’s the prices. That’s not pro- or anti- Medicare for all. If you believe that single payer would force more fair pricing, you’ll love it. If you believe Medicare is incapable of forcing that you won’t.

But the evidence from Brill’s piece is that individuals are HORRIBLE at forcing more fair pricing. So why would we want to go more that way?

And why can no one even mention the words “all-payer”?


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