I have a quick thought on healthcare reform tonight. One of the many arguments against the Obama/Dems current proposal to cover more people is where will we get the money from? Estimates expect the tab to run near $1 trillion over the next decade. Many extend this idea into something on the order of "why should I pay for someone else's coverage or care?"
What I haven't seen mentioned, is that we are already bearing the cost of their care. Huh? Well, there is no free lunch. That much we know. If uninsured people end up in the hospital, which they inevitably do, who foots the bill? Either the hospital or the taxpayer do, both of which must pass the cost along to the rest of us through higher prices or taxes lest they would be out of business. And we all know that ER visits and emergency care are much more expensive- perhaps an order of magnitude more- than regular care. Those pnemonia cases in the ER, for example, generate bills in the thousands compared to a few doctor visits and some antibiotics. The same goes for most treatments.
Of course, this isn't an endorsement of the current plan. There are plenty of valid arguments against the plan, this just isn't one of them.
Edit- Once you've read this, please be sure to read the comments.
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Actually, it is a valid argument against the plan; it's just not a very strong one.
ReplyDeleteFirst, while the plan makes the cost visible, it does nothing to ensure that it is cheaper than when the costs were invisible. After all, if, currently, the invisible costs are lower than the cost of the plan, we should prefer the status quo. Take this set of statistics. If it is correct, then surely the cost of the plan is too high.
We must analyze the health care situation both with and without a plan. The CBO did one recently, and it wasn't all too favorable. I get the sense that those who support the plan do so because they feel the status quo is insufferable. It's a case of "we need to do something; this is something; let's do it."
April 24, 2009 article in the Boston Globe:
ReplyDelete"More people are seeking care in hospital emergency rooms, and the cost of caring for ER patients has soared 17 percent over two years, despite efforts to direct patients with nonurgent problems to primary care doctors instead, according to new state data."
I think your premise is false. If more people are covered by health insurance, costs rise because people demand more healthcare. At least, that seems to be the lesson in Massachusetts, where overall healthcare costs are rising faster than the national average since "universal" healthcare legislation passed.
Fiery, Gavin-
ReplyDeleteIt's funny. After I posted, I couldn't stop thinking about this. It wasn't sitting well with me. Your arguments make logical sense to me.
What I was trying to say, is that we are already bearing some portion of their costs. How much, I don't know.
Close to all of them? All those uninsured patients are paid for somewhere down the line. This system isn't working and every other developed nation has some sort of national health care and along with those plans: longer life expectancy, lower mortality rates, and many other stats. One thing that isn't mentioned in this debate is how much preventative health care will lower costs. America needs to do much more encourage Americans to eat better and live at a healthy weight.
ReplyDeletekbray, what you say seems intuitively obvious.
ReplyDeleteBut from all I've read, more preventative health care doesn't lower costs. It just makes people live longer (which is a very good thing), and gives them more time to get the expensive, chronic conditions (like diabetes and cancer and Alzheimer disease) that cost lots of money to live with.
Also extremely relevant to this discussion, and critical (I think) if you want to base your opinions on data rather than speculation: The Rand Health Insurance Experiment.
I'm not saying that some type of national health care is a bad idea (I think our "half government, half private" system may combine the worst features of both). I am saying that many of the commonly-heard arguments for a national health care system are incorrect.
I agree with Gavin on this. I read a study showing that preventive care increases the overall cost of care. People get better, more comprehensive care, but it also costs more in absolute dollar terms. A large part of this had to do with extensive testing. When a test doesn't cost you out of pocket, you tend to have everything tested whereas an uninsured does not. Conditions that would go unfound and untreated become expenses as a result of the diagnosis. And many of these items are not life or life-style threatening, but treatable anyway. While helping people treat such things may be a worthy social goal, it nonetheless costs more which someone has to pay for. Docs also have to worry about malpractice and tend to over-test as protection. I'll see if I can't find the article or study.
ReplyDeletePreventative health care doesn't mean getting every test to try and combat conditions. A decent diet is preventative health to some extent. I'm coming from the angle of general healthy living.
ReplyDeleteI wholly agree a better diet/lifestyle is important in controlling healthcare costs. You just can't legislate it and make it policy.
ReplyDeleteIt can be "incentivized", either monetarily or otherwise. Theres also the matter of people having more access to information regarding health.
ReplyDeleteI wouldn't be surprised if the people with the most unhealthy lifestyles end up costing the least; maybe most of them die young of heart attacks (which is a very inexpensive way to die, health-care-cost-wise).
ReplyDeleteThat's a question that could be answered with the right dataset (but I have no data, I'm just idly speculating).
Too right. Econtalk podcast had a hospital administrator on who explained how his hospital bills for services. Basically, if you're on a good insurance plan, your fees get some padding which then goes to pay for medicare and the uninsured.
ReplyDeletehttp://www.econtalk.org/archives/2008/12/lipstein_on_hos.html
I think the "do unhealthy people cost a public system less?" question is sometimes referred to as the "ghoul hypothesis". It frequently comes up in the smoking debate. Smokers die early. One side would argue they die early and don't require the long term expensive chronic care. Another side would argue, longer you live you pay more into the system. Does killing off people in their prime tax paying years (say age 55) benefit the bottom line?
That logic sounds eerily like the community housing management reasoning to prevent people from doing as they like on their private property.
ReplyDeleteIt might be a good idea for some, but let's not mandate it on everyone.
As USGovt Financial Examiner who did 400 to 500 exams of institutions in banking & insurance, you're all missing the forest because of fixations on individual trees. You pay attention to forest as I had to do, & 5 top official are sentenced for violating their fiduciary responsibility. For our Healthcare Insurance problems where does ultimate guilt lay...You can Never UnderEstimate the common Politician, they will Always Fall Far Short of your Worst Expectation!!
ReplyDeleteThe larger the number of people in the group insured, the greater the probability group health characteristics will match the characteristics of the Country as whole. If group only has 30 in it, then 3to6 people developing major health problems can happen making 10to20 percent of group High Cost. Insurance Premium has to go way up & was much higher to begin with because the underwriting, actuarial & finance officials of the Insurance Company cannot predict which little group will develop the high cost and which will not.
Only our Politicians can cure this mathematical problem! Pass a LAW that Insurance Companies can treat All Those They Insure as no more then THREE groups, high coverage medium coverage or low coverage, & let them use TWO or ONE if they prefer. Now group size is at least a half million up to 1,2or5 million [for largest Insurance Companies 10s of millions]. 3 to 6, or 30 to 60, or even 300 to 600 will have No effect on the premiums because the denominator used to calculate the premium is huge.
When forced to treat all their insured as no more then THREE groups rather than hundreds to thousands of groups they treat them as now. The Insurance Premium paid comes down for way over half the people because way over half are now being treated as most risky now.
The uninsured when they pick a company become part of that companies huge groups and get the accordingly lower premium for huge groups.
Why has this not been done? Look at the top 20, 50 or 100 givers to your politician’s campaigns, lots of Insurance Companies & their attorneys & accountants. The more people they are permitted to put in small high cost groups the bigger their profit. It is greed and bought and paid for politicians messing Healthcare up. Pass the LAW and Capitalism works, Leave it as it is and you keep your bought and paid for politicians and Health care mess.
This President, Bush & Clinton are all Bought & Paid For so when YOU or I write to them asking for a LAW that mandates HUGE underwriting groups, you will not even get back a cogent answer. My Dozens of efforts have proven this! Their answer will state that, "You can be assured that I care so much and will make every effort to be sure that all of America can get coverage, but it is very complex and difficult to address, with factors YOU don't understand." PURE BS THE POLITICIANS HAVE ALL BEEN BOUGHT & REFUSE TO BIT A HAND THAT IS FEEDING THEM CONSTANTLY.
PLEASE JOIN ME IN BURYING WASHINGTON IN REQUESTS TO DO WHAT IS RIGHT. MAYBE WE CAN WIN IF THERE ARE ENOUGH OF US!