• US health policy adrift

    Jonathan Oberlander’s recent paper in the Journal of Health Politics, Policy and Law is titled “Throwing Darts: Americans’ Elusive Search for Health Care Cost Control.” In our search, or dart throwing, Oberlander wonders why we seem so ignorant of both our past and of the rest of the developed world.

    The American debate has lost sight of a crucial fact: it is not just about how you pay for medical care, but how much you pay for services. Rather than emulating policies that actually work to constrain spending abroad (e.g., global budgets, fee schedules) the United States seems intent on reinventing and reorganizing its way out of the cost crisis. Yesterday’s conviction that capitation and integrated delivery systems held the key to stemming medical costs has been resurrected in the current fad for accountable care organizations and bundling, with scant acknowledgment that we have been down this road before. An ever-increasing list of abbreviations (HMOs, HSAs, HIT, P4P, and so on) bear witness to Americans’ elusive, and now four-decade- long, search for magic bullets. […]

    [I]nternational experience suggests that other nations do know how to slow medical spending; the United States is simply unable or unwilling to adopt those policies. Americans are, in other words, determined to try all available cost-control options — except those that actually succeed elsewhere. Ultimately, the insistence that the United States has to try everything because nothing is certain to contain medical costs sounds less like agnosticism or intellectual curiosity and more like ignorance.

    It’s worth asking, are we moving toward something at the intersection of “uniquely American” and sustainable? Or are we just wandering around, willfully ignoring what we should have learned by now and that others overseas seem to have grasped? I mean, seriously, if you’ve tried fixing the pipe for a week or two and water is still spilling over the floor, wrecking the hard wood, isn’t it rational to consider putting down the wrench and calling in a plumber who knows what the hell he’s doing?

    • “This United States seems”? “Americans are”? It’s not “Americans” who are obstructing cost-containment; it’s the insurance lobby, which calls the shots, frames the questions and otherwise prevents even a discussion of the controls other countries have adopted.

    • Those of us in “other countries” often wonder why “Americans” put up with it.

    • Perhaps most people in the U.S. aren’t that concerned about controlling costs… It’s mostly the aloof political class that’s concerned about controlling costs.

      I’m guessing the U.S. spends far more on automobiles per capita than any other industrialized country, but for some reason we don’t hear a constant stream of media chatter asking when or how we are going to reduce the cost of automobiles. Same thing with televisions, cell phones, computers, and houses… Why don’t we hear a constant stream of propaganda saying that we spend too much on televisions or homes – and asking us to shrink that sector of our economy to get it in line with countries that are not as wealthy as us?

      Assuming the health care industry representes 18 percent of our GDP, what do all the would-be centralized planners think we should cut it down to? 12 percent? That’s lopping off 6 percent of our economy. That’s millions of people unemployed. That’s hudreds of thousands of health care professionals who would need to be retrained to work in other sectors. Only a politician – or an economist bent on seeing things from the politicians’ viewpoint – would view it as a good thing that we shrink the size of a massive industry.

      And, assuming it’s possible to shrink this industry, which industry do you think is soooo important that it should expand to take its place? If the healthcare industry is going to be 1/3 smaller, which industry should absorb that extra 6% of GDP? Fashion? Coffee shops? Even more homebuilding? If the would-be centralized planners have some grand idea for which industry is so important that it should take the place of healthcare, could they please go on the record and let us know?

      And when get done scaling back our healthcare industry to match Western Europe’s – are we going to shrink out automobile industry until it’s the same size as France’s automobile industry? Are we going to shrink our home construction industry until it’s the same size per capita as Spain’s? Are we going to cut back on our software industry until it represents same amount of GDP as Japan’s software industry? Just how poor do we want to make ourselves?

      Again, only a politician – or an economist who is thinking like a politician – is going to look at a particular industry and declare that it’s too big, that we need to shrink it, that we’re falling behind other countries because our industry is bigger than theirs..

      There was a funny story a year or so ago where Nancy Pelosi made some comment about how funding for Planned Parenthood was a good way to lower deficits in the long run. You can see her chain of reasoning: better family planning = less people = less people on government services = lower deficits. But it overlooks the underlying reality that wealth is produced by people and that with fewer people there’s less wealth being produced. But the politician is only looking at the bills the government is paying. It’s the same story with healthcare. The political class is completely cutoff from reality and imagining that smaller healthcare industry = lower deficits. This leads them to the absurd notion that they need to lop off 6 percent or so of our GDP.

      This is why it’s a bad idea for the government to pay for anything. Because once the politicians start paying for something, then they will try to control the costs of it.

    • “You can always count on Americans to do the right thing – after they’ve tried everything else.”

      Winston Churchill