Thursday, July 15, 2010

Supporting ACA and thinking we need to do more on costs

This is my position on the health reform law and is laid out fairly clearly in the columns I wrote on health reform for the Raleigh NC News and Observer (linked on the sidebar). Austin Frakt has a good short post noting this general position, which by the way is the position of many, many health policy types. The ACA was a good first step, in one sense, because it was a step. First, toward covering everyone which is the only hope you have of truly addressing costs after you get rid of the hidden subsidies of our current system in which uninsured folks do get some care. And second, there are aspects of the law that could slow cost inflation to public payers, notably Medicare. Given the history of health policy in the USA, Medicare changes tend to lead to changes in the private system, so this is very important. But, if the ACA is the last step, we won't have a sustainable health care system, and the nation is headed toward bankruptcy as Medicare is the primary driver of the long term structural deficit.

The real questions are: (1) how well will the ACA be implemented, and notably, can the culture of Medicare be changed to move toward adoption of policy changes more rapidly, and develop a culture of trying new things (there will be mistakes). Here is a thoughtful post on Health Affairs blog discussing how Medicare should seek to reduce spending and expand patient benefit. (2) what are the next policy steps that will be taken, especially to address the rate of cost inflation? Capping the tax exclusion of employer paid insurance (at least) is the obvious next step.

But, the biggest question is cultural. Will we Americans grow up and learn to talk about hard things? And face that there are limits to what can be done? During reform I gave a fair number of speeches and events trying to explain what was happening. The crowds had different political persuasions, but there was one similarity to ALL of them. They all agreed we spent too much on health care and needed to spend less (with spend less defined as slow the rate of inflation; less than what we are projected to spend). And when I laid out policies that had a good chance of achieving the goal they all said they shared, they HATED ALL OF THEM. They essentially wanted health reform Disney World style, saving money but making no changes (Disney, after all, has managed to make rape, pillage and murder in the Pirates of the Caribbean ride, a family friendly event!).

I termed this a few weeks ago a culture of delusion. That, more than anything, has got to change for us to have a hope of moving toward a sustainable health care system.


  1. Could you comment on the new requirement that insurance cover preventive care with out any cost sharing? Will this boost use of preventive services and effect spending? And to what extent will the same costs be passed back to patients through increased premiums?

  2. Here is a post by Timothy Jost on Health Affairs blog on this topic. Prevention is very popular, and many times will improve health. I think the money saving aspect of expanded prevention is oversold (but there are conflicting studies) if prevention includes some sort of clinical intervention because when you bump into the health care system, it is designed to do 'stuff' to you which costs money. In the end, the overall cost of care will be reflected in premiums and taxes (they are really the same thing).

  3. sorry, here is the Jost polst on Health Affairs blog