Wednesday, November 4, 2009

Cost-containment and health care

It’s becoming pretty near-consensus that the health care bills are strong on coverage and weak on cost-containment. To wit, from Ceci Connolly’s article in the Washington Post:
“-- A Senate plan to tax high-priced insurance policies saves far less money -- and is less likely to change medical consumption -- than eliminating the tax exemption for employer-sponsored coverage.

-- Proposals on comparative-effectiveness research and a new Medicare cost-cutting commission have been watered down.
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-- An array of Medicare pilot projects aimed at paying doctors and hospitals for quality rather than quantity would take years to be implemented nationally -- if they ever were.”

I’ve left out her fourth item, lawsuits and tort reform, because it’s clear that’s the fake balance so beloved of certain segments of our media. John Cassidy also runs down the key places where cost containment falls short.

As you might expect, the administration is sticking to its talking points; Peter Orszag’s blog post in OMB Blog covers where he thinks most of the cost-containment reform is likely to come from. He’s been excited in various outlets for Accountable Care Organizations; to give you a sense of how wonky and far afield the issue is, you have no idea what that is. Well, the AMA gives a helpful rundown, though it tells you nothing about how likely it is to meet its stated goals, nor how politically palatable it will be when we try to administer the budgetary medicine (though, ominously, it notes that ACOs preserve fee-for-service, which they admit at another portion of the article "...tends to promote high-volume and high-intensity health services, regardless of the quality of care provided and whether that care is coordinated.") And that’s the problem with the bill; the various cost-containment controls are speculative and uncertain. Maybe they’ll work; maybe not. Who knows? What we do know is that every dollar that goes into health care premiums is a dollar that could’ve gone into your wallet…and you can think about what you could have done with a dollar in your wallet.

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