{"id":3008,"date":"2009-08-13T05:00:57","date_gmt":"2009-08-13T09:00:57","guid":{"rendered":"http:\/\/www.geneveith.com\/?p=3008"},"modified":"2009-08-13T05:00:57","modified_gmt":"2009-08-13T09:00:57","slug":"controlling-health-care-costs","status":"publish","type":"post","link":"https:\/\/www.patheos.com\/blogs\/geneveith\/2009\/08\/controlling-health-care-costs\/","title":{"rendered":"Controlling health care costs"},"content":{"rendered":"\n<\/head>

Economics columnist Robert J. Samuelson<\/a> notes the intrinsic conflict between increasing access to health insurance and decreasing costs, arguing that it is impossible to do both at the same time. He suggests controlling costs first. One way to do it, he says, is to reform Medicare:<\/p>\n

Just imagine what the health-care debate would be like if it truly focused on controlling spending.<\/p>\n

For starters, we wouldn\u2019t be arguing about how to \u201cpay for\u201d the $1 trillion or so of costs over a decade of Obama\u2019s \u201creform.\u201d Congress wouldn\u2019t create new benefits until it had disciplined the old. We\u2019d be debating how to trim the $10 trillion, as estimated by the CBO, that Medicare and Medicaid will spend over the next decade, without impairing Americans\u2019 health. We\u2019d use Medicare as a vehicle of change. Accounting for more than one-fifth of all health spending, its costs per beneficiary, now about $12,000, rose at an average annual rate of 8.5 percent a year from 1970 to 2007. (True, that\u2019s lower than the private insurers\u2019 rate of 9.7 percent. But the gap may partly reflect cost-shifting to private payers. When Medicare restrains reimbursement rates, hospitals and doctors raise charges to private insurers.)<\/p>\n

\nMedicare is so big that shifts in its practices spread to the rest of the delivery system. But changing Medicare, and through it one-sixth of the U.S. economy, requires more than a few demonstration projects of \u201ccomparative outcomes\u201d research or economic incentives. What\u2019s needed is a fundamental restructuring. Fee-for-service medicine \u2014 Medicare\u2019s dominant form of payment \u2014 is outmoded. The more doctors and hospitals do, the more they get paid. This promotes fragmentation and the overuse of services.\n

We should move toward coordinated care networks that take responsibility for their members\u2019 medical needs in return for fixed annual payments (called \u201ccapitation\u201d). One approach is through vouchers; Medicare recipients would receive a fixed amount and shop for networks with the lowest cost and highest quality. Alternatively, government could shift its reimbursement of hospitals and doctors to \u201ccapitation\u201d payments. Limited dollars would, in theory, force improvements in efficiency and effective care.<\/p>\n

I like FWS\u2019s idea, expressed in a comment on our recent health care thread<\/a> , of approaching it from the supply side: Let\u2019s increase the number of doctors, hospitals, and high-tech clinics. A bigger supply of health care would send costs down. He writes:<\/p>\n

the last time you sought medical care were you able to comparison shop for the best doctor based on his history of complications, education and price?<\/p>\n

is there a reason there is a shortage of doctors and nurses fueling the demand side and prices? would it not make sense to open more medical schools and create more doctors and nurses?<\/p><\/blockquote>\n

Any other ideas for cutting costs without active or passive euthanasia?\n<\/p><\/div>\n<\/blockquote><\/body><\/html>\n","protected":false},"excerpt":{"rendered":"

Economics columnist Robert J. Samuelson notes the intrinsic conflict between increasing access to health insurance and decreasing costs, arguing that it is impossible to do both at the same time. He suggests controlling costs first. One way to do it, he says, is to reform Medicare: Just imagine what the health-care debate would be like […]<\/p>\n","protected":false},"author":1281,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13,19,27,30],"tags":[],"class_list":["post-3008","post","type-post","status-publish","format-standard","hentry","category-economics","category-government","category-life-issues","category-medicine"],"yoast_head":"\nControlling health care costs<\/title>\n<meta name=\"description\" content=\"Economics columnist Robert J. 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