Obama's Health Care Reform Inspires Little Confidence

America’s health care system is broken, but President Obama inspires little confidence with his fix.

Health care absorbs 18 percent of GDP—about 50 percent more than in other wealthy countries. Prices are too high and are a terrible burden on jobs creation.

Whether Americans continue to pay through private premiums or new taxes, no fix is real without bringing down prices, substantially.

Sadly, Obama’s plan will force Americans to pay even more and chase more jobs abroad.

The U.S. system in unsurpassed in responsiveness—you can see a doctor quickly—but ranks low, internationally, by many other quality measures—infant mortality, life expectancy and preventable deaths. It is burdened by exorbitant drugs prices, doctors that earn twice their Canadian counterparts, higher administrative costs, and a torts system from hell.

Family doctors increasingly act like unionized civil servants—no evening or weekend appointments and closed two hours at lunch. Private insurers and federal agencies encourage doctors to game reimbursement systems, charge well-off patients concierge fees, and send tough decisions to specialists.

Americans subsidize health care globally by paying most of the costs for developing new drugs. Single payers in Canada and elsewhere force drug companies to charge little more than manufacturing and marketing costs, and they must recoup all their development costs by charging Americans oppressive prices.

Unlike U.S. health insurance companies, single payer systems abroad don’t pay executives salaries in the millions, impose multiple systems of private rationing second guessed by buccaneering lawyers, and create massive paperwork burdens to justify high rates.

Americans have created a “competitive market” for private insurance that is less efficient than the French bureaucracy—what a triumph of free enterprise!

The torts system pays lawyers grandly for curing little, and imposes Orwellian decisions on doctors regarding testing, best practices and care for the terminally ill.

Some people can’t afford health care but those are hardly all the 46 million uninsured. Many are poor adults and children who should be enrolled in Medicaid, illegal immigrants, and young workers and rich folks who opt out.

Essentially, President Obama would subsidize health care for those who can’t pay without addressing the perverse incentives for doctors, executive salaries, drug prices and torts abuses that make health care too expensive in the first place.

My very expensive education in economics tells me, when prices are too high for an essential service, subsidizing purchases for those who can’t afford it increases demand and pushes prices up even more.

Americans will be stuck paying both higher health premiums and new taxes.

President Obama promises to lower costs down the road in exchange for new taxes to cover the uninsured today.

Remember Wimpy in Popeye: “I’ll gladly pay you Tuesday for a hamburger today.”

The children in the theater laughed at the con. Sadly those children are not voting in Congress on Obama Care.

Comments

[Windsun33:]

The problem with the US health care system is that the vast majority of past, present, and future "fixes" are politically motivated. The refusal of the Obama administration to address the costs imposed by excessive and often frivolous lawsuits is just one of many examples.

But it goes back many years, and has become a patchwork mess of Demo-Pubs all trying to outspend each other and compete for the millions of lobbyist dollars.

The fundamentals are broken, adding more band-aids won't fix it.

Jul 07 08:55 AM

[DmytrenkoArtem:]

hah... In Ukraine we have contrarian situation.. the medicine is free officially but to have normal level of medicine care we need to pay a lot money...

Jul 07 09:33 AM

[YoYoMama:]

Peter - love your article. We indeed have a "torts system from hell"!!

We also have a Medicaid system from hell, rife with fraud, needless waste and spending. If Medicare / Medicaid were not treated like the proverbial cookie jar everyone can get their hands into, we might actually be able to expand government coverage for those who need it. But it's pointless to talk about expanded coverage when the system is already broke from abuse.

Jul 07 10:26 AM

[bbowen7:]

Under any system, who says "we have a solution, but it is too expensive to provide it to your family?"

Jul 07 02:34 PM

[TinyTim:]

Peter-
good article. you hit just about all the bases.

take exception: "unsurpassed in responsiveness—you can see a doctor quickly"
what city is this? specialists take 6 weeks around here.


"Private insurers and federal agencies encourage doctors to game reimbursement systems"
Yes, doctors are acting like capitalists. maximizing income so they can take 2 hr lunches and get twice the pay of Canadian docs. Many tell me they plan on retiring at 50.

IMHO this is the main cause of escalating prices. This article provides a close-up look at this cause. Unfortunately, they nor I have any solution.

www.newyorker.com/repo...

Jul 07 05:02 PM

[medsearch:]

Peter, this is a great analysis of some of the problems with Obama's plan. Loss of health care-related jobs will exceed 150,000 nationally!

At my web site, www.gorillamedicalsale... , we have already seen the jobs lost by the specter of his policies! Our site is a job board for medical device sales representatives to find employment. Recently, vacant sales openings are being left unfilled as these medical companies prepare for life after reform.

Jul 10 11:46 AM

[growser7:]

There are some funny misconceptions about the life of a doctor. I have practiced internal medicine for 20 years. My two hours off for lunch are spent seeing patients in the hospital; my nights and weekends are spent doing paperwork (filling out Medicare forms justifying the use of Depends; those miserable forms form the Scooter Store; recertifying people for home oxygen, petitioning insurance companies to allow me to use certain medicines, or get a walker paid for, plus writing letters to patients, returning calls, etc etc). On average I spend about 20 hours a week doing this invisible stuff, and my workweek averages about 70 hours, 51 weeks a year. My call nights of course kick that up to maybe 90-100 hours, I don't know.

Meanwhile, my income (in nominal dollars) has risen a grand total of only 15% over the past decade. I make a decent wage, but at enormous personal cost, and I'm losing ground.

The fact is, primary care doctors, at least in my region of the US, lose money on Medcare and Medicaid patients. Simple irrefutable fact. So---we have to pass those costs on to the rest of you to stay upright. There are exceptions in specialty care---some quirks of the fee system allow for ridiculous charges e.g colonoscopy costing multiple thousands, but most primary care doctors feel embattled and many would quit if they could.

The fat cat doctor is largely a myth---at least in primary care. And herein lies the dilemma. It sounds fine, all of this talk of savings, but it has to be accompanied by reduced and more realistic expectations. I could see more people (with reduced unit costs per patient) if I didn'thave to fill out all of those @#$%% forms and push against various bureaucrats, and wargame my practice style to counter the malpractice attorneys who fish in these waters.

I have found that no one wants to do without---as long as someone else is paying for it. As the saying goes "Everyone wants to go to Heaven, but no one wants to die to get there". In this case, many/most people are more than happy to utilize the system e.g. have a brain MRI because they have had a headache (even when doctors try to dissuade them) but then act shocked when their premiums rise.

There needs to be less care, less doctors, greater acceptance of mortality and hardship. This isn't heartlessness---I love my practice and my patients. Compassion and understanding don't cost that much....but unfortuantely they don't generate clinic revenue, ROI, and don't pay for my nurse, typist, insurance compliance person, coding and billing specialist, quality compliance auditor, or my malpractice insurance. You get the picture.

--Written during a break in the action on call, 3 AM

Jul 16 05:19 AM