The “Obamacare” Debate
Some key pieces in the debate over the healthcare reform bills passed by the House and Senate are linked below (TOH to Brad DeLong for the first three). We put “Obamacare” in quotes in the title of this piece because, while Obama’s election certainly paved the way for health care legislation to proceed, ownership of health care reform extends far beyond - and before - the current administration.
A WSJ editorial from mid-December argued against cost containment arguments made in support of the legislation:
The White House hawked a permanent entitlement expansion on flimsy and speculative theories that its own partisans now admit—albeit when it is nearly too late—aren’t more substantive than the triumph of hope over experience, while simultaneously writing off the one policy that has been effective in the real world. The cost control mantra of ObamaCare was always a political bill of goods, and its result will be the opposite of its claims: poorer quality care at higher costs.
The editorial incited a spirited defense from Peter Orszag, head of the Administration’s Office of Management and Budget (OMB):
We are not setting out a plan with every detail laid out for what the health care system of the future should look like. Thinking that we could lay out in full detail a perfect system today would show a foolish disregard for the dynamism of the health care sector – and of the American economy in general. Instead, we are putting in place processes by which what works and what doesn’t can be rigorously tested, and then scaled up over time as they are reflected in the decisions of thousands upon thousands of hospitals, physicians, and other providers. Does the Journal have a better suggestion about how to approach policymaking in a dynamic world?
…Can more work be done on health reform? Sure. And that is what is occurring through the legislative process as I write. Moreover, even after passage, we will need a continuous assessment of what works and what doesn’t and rapid adjustments to a changing market – all of which can be done with the mechanisms laid out in this bill.
The bottom line is that continuing on the road we are on will overwhelm our economy and our federal budget. The health care plan being considered in the Senate now is built on the best available knowledge and most promising ideas from across the political spectrum. Critics may fear this change, but what we should fear more is doing nothing.
Along those lines, David Frum, a bit of a black sheep in the GOP of late, offered a pithy but interesting critique of his party’s strategic response to health care reform and other legislation: “Republicans could have been architects of improvement, instead we made ourselves impotent spectators as things get radically worse. Plus – the bad new Democratic proposal will likely be less unpopular with voters than their more promising earlier proposal. Nice work everybody.”
Frum’s position on healthcare is fairly orthodox among conservatives, but for those who subscribe to Barron’s, we highly recommend the columns that Thomas Donlan has posted on the issue over the past year. In his most recent column on the subject, he reviewed T.R. Reid’s The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care, and pointed to at least three critically important factors that will be stubborn barriers to cost control:
American docs can make four times as much as those in Japan, France, Britain and other countries. The foreign docs, however, mostly go through med school on government-paid tuition, and graduate free of debt. They pay what Americans would consider extremely low malpractice-insurance premiums. And those in private practice do not need to hire their own administrative staffers to deal with a myriad of insurance administrators and claims adjusters.
Donlan recaps Reid’s overview of the French health care system, illuminating some of the contrasts (and critical differences) between our system and one designed to provide universal access at a relatively low cost. Anticipating concerns about the potential for waste, fraud, and abuse in a system like France’s, he asks “what accounts for the fact that the country spends $3,165 per citizen for a system that covers everybody, while the U.S. spends almost twice as much per citizen and covers only 85% of them?” Donlan concludes:
Americans…should come to grips with [T.J.] Reid’s frank advocacy of some kind of universal health care for the U.S. on the grounds that everyone has a human right to “adequate” health care — although not without limits, whatever they may be.
Every other country that can afford it has decided to provide a minimum level of health care to everyone, regardless of income and wealth, at a minimum cost out-of-pocket. The U.S. Medicaid program also provides a minimum level of nearly free health care, but not to everyone. It aids 59 million people, the poorest 20% of Americans, by Medicaid but the coverage and eligibility vary widely.
Too many Americans say health care is a right and don’t want to have any responsibility in paying for it. Too many want market-driven health care without winners and losers. A close reading of Reid’s book may help them think more clearly.
Donlan’s conclusion lends support to our prior assessments of health care reform — that it is complicated stuff, both philosophically and operationally.
URLs:
http://delong.typepad.com/sdj/2009/12/ten-economic-paragraphs-worth-reading-december-21-2009.html
http://online.wsj.com/article/SB10001424052748703558004574583962940536556.html
http://www.whitehouse.gov/omb/blog/09/12/14/No-Illusions/
http://www.frumforum.com/the-cost-of-no-deal
http://online.barrons.com/article/SB125935468698266957.html
http://symmetrycapital.net/index.php/blog/2009/07/ryan-what-does-it-look-like-in-september/
http://symmetrycapital.net/index.php/blog/2009/07/should-health-care-be-a-right/
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Tags: Healthcare, Opportunity Cost, Political Economy, Politics, Public Policy, Regulation
News and Views | art December 23, 2009
