When the financial melt down started we heard two much-used phrases called systemic risks and moral hazard. But, Wall Street don’t own those terms. The medical care and medical care reform also can contain both systemic risks and moral hazard.
Among systemic risks in the medical world would be to allow health care expenditures to advance form the current 16% of GDP to 25% or more. The impact of that kind of bite would be to restrict all other growth and development and throw us into a dark age. A dark age that would collect even more defenders and make it harder to extricate ourselves.
A companion to that outcome would be to try to provide health insurance coverage to everyone without reducing the cost of that health care. This would require unthinkable amounts of borrowed money, which could make for an unstable and unreliable currency that could bankrupt the country. Reluctant international lenders could take us on the road to inflation and the compounding of the misery.
It would be a devastating mistake to remove the responsibility for health care away from the individual. It might be said that is already the case as HMO’s and insurance companies are somewhat dictatorial in prescribing and paying for medical care. But, it can be a lot worse. It is not hard to get the bulk of the population to think that health care is free. If free, you might want to run risks with your health. After all, we still believe in medicine. We, often mistakenly believe, that technological advances can correct all that we might break or would go bad.
A good portion of the population still smoke (20%) and if health care treatment and expenses are all or near all met that figure might not come down anymore.
Many parents of the nation do not provide children with healthy food. Likewise, many schools in the nation do not serve healthy food in their lunch counters and cafeteria. We supply children with what they want to eat and not what is good for their health. As a result, 30% are overweight. Just unhealthy and they look unhealthy. At some time they will pay for a bad diet. But, if the government takes care of everything, where is the incentive to eat right. Maybe medical consequences is a risk worth taking in order to be satisfied for the moment.
As you move from individual responsibility to the collective care of the central government you have changed America. It has been a quiet revolution. It is not just who is paying the bills, but who has power and control. The rationale is that as long as the central government is paying the bills they should exercise control. This is dangerous! Dangerous for our liberties. The MedPAK proposal that will establish a panel to render the direction of medical care will usurp that power form Congress. If you take power away from the Congress you take it away from the people.
Congress is often incompetent to deal with matters of our time and a recent history of failure. And, no conclusive indications this will soon change. However, the Congress remains the legitimate repository of power. The hope is that people will catch on and change the Congress while there is still time.
Soon, there will be “MedPAKS” coming from the Treasury Department to deal with Wall Street crooks in a way that will shift more and more power to the Federal Government. This power shift must be resisted!
Health care is a fraud, demographic, anti-competative, ethics, cultural, malpractice and policy problem, but not a malpractice claim problem.
We have too much malpractice. That is a big problem. The statistics show us that hospitals and doctors get by with more than they get charged. Most people injured by medical malpractice do not bring legal claims. Depending on which medical reserch you believe, between 100,000 and near 200,000 people die each year from preventable medical errors.
Negliance has to be addressed. Doctors have resisted scrutnity over the years. They don’t appreciate people looking over their shoulders. Therefore, we don’t have adequate oversight into doctor and hospital performance. If a doctor comes into surgery with a hangover from a long night at the country club and happens to mess somebody up he should have to pay. The courts and some hungry lawyers will be waiting for him.
Last week, the Congressman from our district, a doctor, had a news story in a local newspaper touting tort reform. He cited an example of a local doctor who had been sued in a malpractice case. The doctor increased his orders for tests by 550% and referrals to specialists by 350% in one year. Where is the ethic there? Is it ethical to make your patient go through the rigors of tests, as well as risks, just to cover your rear end or establish some legal immunity?
Courts render a lot of injustice, but any replacement is sure to have it’s own problems. Plus, in the absence of adequate scrutiny the courts protect patient safety. And then, you always have the 7th amendment.
Tort reform cannot be allowed to be a distraction from meaningful changes is health costs. Not this time! Not when health care takes 18% of GDP and is projected to take 40% in 2050. Not when families pay 10% to 15% of their income for health needs. The do-nothing years have passed.
What do the medical care experts agree on?
1) Technological innovation is largest contributor to health care inflation. I might add the over-use of this technology. As an example we do more than twice the MRI’s that other developed countries do.
2) Overall, we don’t have better health care outcomes than countries that spend much less of their GDP.
3) The fee for service system is a culprit in the context of third party payers. It permits doctors and hospitals to pad services. It is a reverse incentive to lower health care cost.
Most should agree that the direct pay or predominance of third party payer also has bore a heavy burden on cost containment.
Health care reforms that are being circulated have aroused two major fears: the cost and the expanded role of the Federal government in health care.
Both are justified fears.
The Congressional Budget Office has produced enough projections and data to legitimize the unexceptable cost.
Proposals such as having Med-PAC technocrats manage Medicare policy. This proposal is billed as ” taking the politics out” of Medicare, meaning the Congress. Who is to say the Med-PAC board will not become crooks? Could they not receive bribes and pay-offs? Freddie Mac and Fannie Mae officers were not elected politicians. Were they not influenced?
Expanding the Federal role will not fix anything, but will make the so-called reform pallatible for a time, a short time.
What will work?
Create competition! The Federal government should exercise a proper role to create competition in the medical fields and then step aside.
But, you might say, much of medical care does not lend itself to competition as you might find in the automobile or furniture business. Much of medical is a natural monopoly. After all many towns only have one hospital. So, you write regulations as best you can and make violations punative.
Much of medical does lend itself to competition. There is a role for the Anti-Trust Division of the Justice Dept. to find creative ways to establish real competition. Should pharmaceutical companies still be merging in this climate. Well, they are merging.
First year enrollment in medical schools is about 18,000. Maybe it should be about 30,000.
There is a proper role for the Federal government, but it is not managing health care.
If health care is an oligopoly it should be regulated in proportion that it behaves like an oligopoly.
One reform would be standardized evaluations for performance of doctors and hospitals. This would surely cut down on lawsuits for malpractice and other abuses. States could administer the measuring of performance with regular reporting. Published reports could take care of a lot of quackery and substandard hospitals. Think of it as a batting average for doctors.
I watched the news conference tonight. It was surreal, like I had watched it before. The credibility of stock questioners at these events has never been more suspect. So much unsaid, so much unasked. The courtesy exceeded even the perimeters of courtesy.
I would say I had wasted an hour except for one thing I heard that was not said. That is, Medicare fraud bought us to this point.
In considering American health care a few things must always remain in our minds. Among these are:
- We have universal health treatment for 100% of our citizens and visitors. This is obviously inequitable and limited. But, we don’t let people die on the streets. This policy is mandated upon hospitals.
_ Seniors have universal health insurance.
- States, through the Medicaid program cover health care for the indigents and low income, generally.
- Of the 49 million without insurance it is estimated that a high percentage, maybe exceeding 25% choose not to purchase health insurance, even though they can afford too.
- The overall cost of health care is unsustainable. It will place the country in financial ruin. Doing nothing is really not an option.
We will be able to easily identify progress on health care! It will be when the politicians start making more proposals on costs reductions and less on coverage. This Congress might not be able to accomplish this fundamental need. We will see.
In the posts ahead this blog will comment, in plain Tennessee language, on the dilemma of health care. Proposals for fixing run away costs will be coming soon. A House version has already been released. It is getting many unfavorable reviews. Just this morning the Wall Street Journal published Mayo Clinic’s assessment. They were quoted, “misses the opportunity to help create higher quality, more affordable health care for patients. In fact it will do the opposite.” Before we attempt repair it should be determined what is salvageable. As I say, in plain Tennessee language.
The House released their Health Care Reform package this week and the Congressional Budget Office promptly threw a wet towel over it citing overall costs. The American Medical Association(AMA) supported the plan. That adds up to two votes against it right off the bat.