Bottom line, how does this bill contain the rising cost of medical care?
You've asked this before but don't seem to have ever seen the answer so I'll post it again.
Obamacare doesn't take just one approach to cost containment. It accepts that incentives are broken at pretty much every level of the health care system and proceeds from there.
If your pet issue is overutilization/poor shopping for health services by
consumers and patients, you'll be pleased to know the law is a boon for consumer directed high deductible plan-HSA pairs. It reduces the tax incentive for employees and employers to have overly generous benefit designs. It adds new transparency requirements for hospitals to make public a list of their charges for items and services they provide.
If you think costs increases can be traced to
the insurance side, the ACA places limitations on the portion of premium revenue that can be spent on non-medical things (like the executive compensation liberals complain about). It brings new insurers into markets that have been devoid of competition, in part by seeding the creation of new homegrown (and consumer-operated) plans and in part by allowing existing insurers to sell across state lines in new markets. It forces competition on price and quality (not risk-culling); since a significant component of premium prices is affected by the reimbursements insurers negotiate with providers (i.e. prices), they'll have new impetus to put the brakes on increases in them.
It fixes deficiencies in existing insurance markets to ensure that consumers have the information and the structure needed to make meaningful choices and send clear price signals--shopping in the new marketplaces is going to make it very easy to see what you're getting with a new plan, what the prices are (and even your own likely expenses under a given plan), how the choices stack up in terms of quality, etc. The ACA also offers states grants to develop new insurance premium oversight mechanisms that, when used aggressively, have
shown potential in being able to help hold down rising costs.
If you think costs are being driven on
the provider side, the ACA is making a huge push to address the problems in organization and care coordination, etc that drive costs on the provider side. It would take way too long to go through all of what it's doing on that front but a major strategy in the ACA is to use Medicare reform to drive change by
(1) shifting the way Medicare pays for services away from encouraging high-volume, low (or mediocre) value service provision, and
(2) promoting and assisting health care providers in delivering better care more efficiently and less expensively, while holding them accountable for quality outcomes.
You can see some of what's coming down the pike in results (i.e. slower cost growth, higher quality scores) from this private sector pilot in Massachusetts that incorporates some of these principles:
http://www.usmessageboard.com/healt...-reform-model-lowers-costs-improves-care.html. The arrangement described in that thread saw savings of 10 percent in the second year for providers who switched to it from traditional fee-for-service models, all while quality rose. Similarly, CalPERS has been
piloting an accountable care organization for a little over 40,000 of its members in California. Per member costs
fell 1.6% for participating members, vs costs rising 10% for non-participating members from 2010-2011, saving CalPERS $37 million.
More importantly, there are some early indicators that providers have already begun to reorganize care delivery in response to the ongoing and coming reforms, accounting for some of Medicare's current record-low cost growth--and offering some promise that we might be entering a new era of cost containment. Obamacare tackles the biggest cost drivers, not just in Medicare but in the entire health system: the inflationary payment mechanisms and flawed delivery systems that have plagued the health system for decades.
If tort reform is your issue, the ACA offered federal money and assistance to help states find innovative ways to reform their own tort laws (the GOP Congress has refused to fund that provision of the law). Those who push for blunt force approaches to tort reform, like national caps on damages, miss the fact that many, many states have already tried caps on damages and the like. If there's money to be saved through tort reform and we're going to protect the rights of patients, we're going to have to get smarter about how we do it by trying new approaches (e.g. health courts). That's why we need states to start experimenting with new strategies.
Those who say the law does
nothing to rein in costs are just being silly: it goes after cost drivers at every level of the system. There's more to be done in the future but it's a hell of a start.
