Wednesday, May 3, 2017

Absolutely the most succinct explanation of what health care is, is not, and how it's been dealt with in America you've ever read

I'm going to excerpt at length from this one, because it is so important for everyone in the universe to read.

The Cato Institute's Michael Tanner at NRO:

1. Health care is neither a right nor a privilege; it’s a commodity. Worse, it’s a finite commodity. There are only so many doctors, so many hospitals, and so much money, and there are limits to how much these things can be expanded. That’s why no health-care system, outside Bernie Sanders’s fantasies, provides unlimited care to everyone.

Every health-care system in the world rations care in some way, either through bureaucratic fiat (Scandinavia, the U.K.), waiting lists (Canada), or price (that’s us). One can argue about which of these rationing mechanisms is fairest or most efficient, but let’s not pretend that it won’t occur.
2. Coverage is not access. Democrats like to pretend that giving everyone a piece of paper called insurance guarantees them access to the care they need. It’s sort of like magic. Say the right words, and poof, medical care appears. But in the real world it doesn’t work that way.

For example, take Medicaid, which is responsible for more than half the increase in coverage under Obamacare. Nearly a third of primary-care physicians won’t accept Medicaid patients. And when doctors do see Medicaid patients, they tend to be slower in granting appointments. Moreover, for the working poor, seeing doctors during normal office hours can be problematic. Perhaps that’s why Medicaid patients continue to use emergency rooms for routine care at a disproportionate rate. Numerous studies show that health outcomes for Medicaid patients are little better than those for the uninsured. In fact, some studies show patients faring worse under Medicaid than if they had no insurance at all.

Similarly, if Obamacare forced your insurance carrier to cut back its provider network, your shiny new coverage may no longer include the physician of your choice. And the incentive structure of Obamacare, notably its pre-existing-condition rules, encourage insurers to drop coverage for top doctors and hospital centers of excellence.
3. The uninsurable are uninsurable. Let us remember that the definition of “pre-existing condition” is: someone who is already sick. It’s a little like driving your car into a tree and then trying to retroactively buy auto insurance. It won’t work. Insurance is the business of spreading risk. But for someone who, say, has cancer, there’s no risk to spread, just cost. That’s not insurance, it’s paying for health care.

Obamacare tried to square this circle by mandating that young and healthy people buy insurance to offset the cost of providing care to those already sick. It turns out that didn’t work. Not enough healthy people signed up to pay for the influx of sick people. Insurance companies either dropped out of the market, cut back on high-quality providers, or raised premiums. All of this forced more healthy people out of the insurance pool and threatened an adverse-selection death spiral.

Republican proposals to keep the popular pre-existing-condition protections while jettisoning the mandate for coverage is only going to make the adverse-selection problem worse. It may have sounded like a moderate compromise, but it is like trying to be a little bit pregnant. It’s not going to work. The only realistic approach to dealing with pre-existing conditions is to take those people out of the insurance pool altogether and somehow pay for their care directly. There are several options for doing so, from state insurance pools to a revamped Medicaid program.
4. Medicare is not a success. Faced with the wreckage of Obamacare, Democrats are increasingly embracing the once controversial idea of “Medicare for all.” Most of them would start slowly, with a Trojan-horse “public option,” a taxpayer-subsidized plan that would undercut private insurance, but the result would still be a government-run national health-care plan based on Medicare.

Medicare is undoubtedly popular, especially with its beneficiaries. It should be. The average two-earner couple pays about $150,000 over their lifetime in Medicare taxes and premiums, while collecting almost $450,000 in benefits. Jackpot! But that disparity is one of the reasons why Medicare is running some $58 trillion in the red, after totaling all projected future liabilities. A program facing more long-term debt than most countries probably isn’t begging to be expanded.

Moreover, almost everything that people complain about with our health-care system is even more evident in Medicare. Medicare is inefficient, spending lots of money without evidence of better results. According to the landmark Dartmouth Atlas study, the counties with the highest per-patient Medicare costs showed no better outcomes than low-spending areas. Medicare over-covers routine care but stops covering you if you get really sick. It is based on an old-fashioned “fee for service” payment protocol that rewards inputs, not quality. And, its bureaucratic price controls under-reimburse doctors, shifting costs to private insurance plans, or discouraging doctors from seeing Medicare patients. About 15 percent of doctors don’t accept Medicare, and as many as a third limit the number of Medicare patients that they will treat. 
5. No, we didn’t have a “free market” health-care system before Obamacare. Suggest free-market reforms to our health-care system and critics will inevitably suggest that you want to go back to the flawed system we had before Obamacare. But that system had little to do with a free market. Nearly all health care was subsidized in some way, either directly or indirectly. Actual health-care consumers paid barely 13 cents out of each dollar spent on health care, while the government directly paid for more than half of all health-care spending. This third-party and even fourth-party payment mechanism insulated consumers from the cost of their health-care choices and drove up both spending and prices. 

At the same time, provider cartels, both insurers and medical professionals, used regulatory and licensing barriers to protect themselves from competition and inflate prices. Other markets in goods and services routinely produce lower prices and better quality. Health care has always been different precisely because free-market competition and consumer choice have been missing. 
6. You are never going to make everyone happy. Obamacare is unpopular. The GOP replacement was unpopular. Single-payer in unpopular. In fact, one searches in vain for a health-care reform that voters will love. 
Given the above, there is only one thing to be done: put caring for health on the same normal-people footing as any other good or service that is bought and sold in a free market.





23 comments:

  1. There are only so many doctors, because medical school admissions have been kept artificially low since at least the days of the fight against "socialized medicine."

    http://wallstreetpit.com/5769-the-medical-cartel-why-are-md-salaries-so-high/

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  2. #3 addresses "adverse selection" which is of concern to a health insurance corporation which of course is designed to make the top dogs and the stockholders money first, pay the medical bills of its insureds is secondary to their mission,i.e., their day job. Universal coverage would eliminate the health insurance carriers. Too bad, so sad for us other poor bastards who lose our jobs, so ya think we're gonna weep for them?

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  3. Start the Medicare reform by burning your wife's medicare card why don't you? You should be looking forward to getting it too. it's not that great, you have to buy a bunch of supplements to be fully covered. But, hey, make it better, maybe? Or try to axe it and see what happens.

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  4. Re: comment one: Tanner addresses that under point number five. We didn't have a free market system prior to the "A"CA. In fact, he uses that very term - cartels.

    Re: comment two: Again, there is a lack of an element of competition which leads to insurance companies being difficult to get claims out of.

    Which gets to this business of "universal coverage." What is going to incentivize anyone to pursue a career as a doctor, nurse, therapist, pharmacist or radiologist if there is no possibility to provide better service than the next guy and grow one's practice? Innovation - technological advancement - would come to a screaming halt as well. Who the hell would risk capital to start a company making some device if the government would say, "Here's all we're going to pay for your machine"?

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  5. I do not think it has any thing to do with coverage on an insurance plan. Catastrophic care is required by many health care providers even to the despicable poor and uninsured. Good luck changing that cash cow in the health care system. The complete health care change would be absolute denial of even basic right care to the uninsured to life care. The real world is nearly half the health care industry is supported solely by these despicable poor. Is it sustainable, good question, is it a right, I believe it is. I am sure most of the medical industry is in agreement or these profits would drop by half. How would that work, one third of the economy (medical industry) with 50% loss. I think most people really do no have a clue exactly how the payout works in the medical field. Good luck with the denial approach.

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  6. My wife is a classic example of elimination to the forward thinking heath care plan. She had no health (not eligible by existing problems)care. The system stepped in and now it pays nearly a 200k for her care per year. In your idea this would be eliminated. How many jobs are lost there? I think Health Care is much more complicated than who pays what. The only alternative is send the old decrepit and sick out on an ice berg and say good luck, monetarily you are not viable

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  7. Bloggie, your ilk better come up with and implement a stunning new replacement for Obamacare. Come on, you can do it! Otherwise, I see you're well prepared to diss your party as you have on other counts. There is an awful lot of legal ground to be covered if you're going to overturn over a century of case law, including several past Supreme Court decisions to get back to your beloved free market on the hill. And, like I said, the system, as the voice of current experience Mr. Mitchell has informed you, pays anyhow. Seems to me you're heaven-bent (I know you bring God into your freedom for the corporations pipe dreams) on sticking to your opinions about free market remedies. No, we did not have a free market before and are quite unlikely to ever have it again. Therefore, with God on your side, I would presume you need to start another bloody revolution. Will you muster the US militia or have to fight against them in your quest?

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  8. Mr. Dings, of course I'm bent on sticking too my understanding of the fact that economic freedom is the only workable way for human beings to economically interact ("opinions about free market remedies").
    Why do you say we're quite unlikely to ever have a free market. IF enough people can be made to understand the importance and the elegant simplicity of freedom, it could happen at any time.

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  9. Michael, see Tanner's point number 3. The uninsurable will have to be dealt with by state pools or a revamped Medicaid program.

    Yes, health care is more complicated than who pays what, but dealing with question is essential and primary. And I would submit that it is best addressed by eliminating, to the extent possible, any middle party between the producer and the consumer of "health care," however broadly or narrowly defined. Then we can find out what the true market value of a particular health-care good or service is.

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  10. Mr. Quick that I think will never happen, half of health care relies on the uninsured or poorly insured for income. Their lobbyist will watch and block any significant state actions. I doubt even the health industry or free markets will have the slightest effect on pre Obama care medicine. It is in the numbers, not the theory, things will be as they have been far before ACA.If emergency rooms can charge 1400 for prescribing minor health care to the indigent as they always have, this will continue. Nobody's likely to jump out of that pool quickly without deliberate and clear plans. I personally do not see leadership with the understanding how this will be done. I think current status will be maintained despite political activity. Pools are nonsense in my opinion.

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  11. We all pay for state pools and Medicaid programs. Mr. Quick, sir, you are merely defending the insurance companies.

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  12. You are assessing my position through a very distorted lens. Insurance companies must be put on an actually competitive footing, like all the other actors in the health-care scenario.

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  13. You are assessing my position through a very distorted lens. Insurance companies must be put on a truly competitive footing, like every other actor in the health-care scenario.

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  14. Anyhow, having to cover pre existing conditions is indeed forced adverse, very adverse selection and you can expect premiums to rise and the grand Pub plan to crumble, leaving the best opening in history for universal coverage. Thanks!

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  15. Pubs are indeed going about it wrong in the bill being voted on today, still trying to shoehorn pre-existing conditions into an insurance model.

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  16. Even I think that is a recipe for disaster. Some bill, huh, crammed up the butts of all the Dems and 22 Pubs. Not a single Dem vote. I recall your ilk and the Pubs crying for an entire 6 years that your rectum hurt. And how can I repair my glasses if they're distorted? Don't bother, my lenses are fine. And there is likely over half of America that is gonna rag like hell at your former party's bill too, if it ever really gets implemented.

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  17. I'd like to see bloggie respond to Mr. Mitchell's report regarding his quandary involving 200K annual medical bills of his spouse who has had a pre-existing condition since she was an adolescent. The 200K per year has been ongoing for at least 3 years maybe more. Who pays?

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  18. Trump praised the Australian universal HC model yesterday as being better than ours.

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  20. Berkshire Hathaway Inc Chairman Warren Buffett on Saturday fumed that healthcare costs are eating away at the U.S. economy like "tapeworm" and said the Republican approach to overhaul Obamacare is a tax cut for the rich.

    The U.S. House of Representatives on Thursday narrowly approved a bill to repeal and replace Obamacare, a victory for Republican President Donald Trump who has called the 2010 law a "disaster."

    Speaking at Berkshire's annual shareholders' meeting in Omaha, Buffett said his federal income taxes last year would have gone down 17 percent had the new law been in effect. "So it is a huge tax cut for guys like me," he said. "And when there's a tax cut, either the deficit goes up or they get the taxes from somebody else."

    http://www.msn.com/en-us/news/politics/buffett-calls-obamacare-replacement-a-huge-tax-cut-for-guys-like-me/ar-BBAP0fe?li=BBnb7Kz&ocid=SL5JDHP

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  21. And a huge shot in the arm for the health insurance companies who can cherry pick their risks and slough off what they cannot abide to the state and federal government. Let freedom ring, right bloggie?

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  22. They have to make money. Otherwise they can't continue in existence.

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  23. Oh, they make money and I think lobbying is one use of it, such that the politicos vote their pocketbooks as if it were their own.

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