Here are some quotes from the Huffington Post regarding the failed healthcare vote. Let’s use these as a Segway to discuss several aspects of the problem of healthcare cost in the US.
“Until the nation is willing and prepared to seriously fix these underlying systemic problems, simply extending coverage will only serve to pour gasoline on a fire.”
Interestingly, this same thought occurred in another paper on healthcare costs. The thesis is that there are systemic problems in the way healthcare is delivered and paid for that go beyond insurance. Providing wider coverage-even universal coverage—will just bring more people and money into a broken system. In this case, “broken” means expensive. There is no incentive for doctors or hospitals to become more efficient or to charge less for their services. Until we create those incentives, no one will venture forth. My personal mantra is that price competition would go a long way. If Medicare published an RFP for each of their tensest expensive procedures (e.g. total hip replacement), hospitals would find a way to become more efficient or else abandon the procedure. Estimates of potential savings vary from 20% to 50% just by eliminating waste in the procedure.
“Five decades of efforts by both approaches using bureaucratic controls, micromanagement, and token bonuses to make providers efficient have failed to contain run-away cost.”
We’re not there yet. You can’t do this by top-down management or perverse incentives. Providers must compete with each other on price. What would your new car cost if there were no price competition between manufacturer? General Patton is quoted as saying, “Tell people what you want done, but don’t tell them how to do it. They will amaze you with their ingenuity.”
“The National Academies estimate at least 30 percent of health expenditures are waste, of little or no benefit and possible risk to good health results.”
You have to be a little careful in evaluating assessments of waste. Many Academies are influenced by provider groups and resist the notion that providers could charge much less for what they do and still have the same income by becoming more efficient.