What amazes me most is there are still people who argue there is no problem with American healthcare, or that it can be fixed with tax credits, but they are underinformed. America spends over 15% of its GDP on healthcare, which is the highest in the world, and this value is expected to reach 20% in the next decade. Medical bills are also the most common reason for personal bankruptcy. These drawbacks might be tolerated if America also had the best health in the world, but according to organizations like the World Health Organization, America is in the middle of the pack of all nations, and near the bottom when compared to other developed nations. Basically, we dont get what we pay for, but many wonder why.
The issue of healthcare reform wouldnt simply be fixed by making it government-funded. But effective, comprehensive reform would have to involve moving to a quasi-single-payer system.
Healthcare needs to be socialized, but I wouldn't extend that to all of the economy. See healthcare is different from other sectors of the economy. How much are people willing to pay for a procedure that will save their lives? There is no upper limit. The answer is whatever it takes or whatever they can come up with. Thus the traditional rules of supply and demand do not work for healthcare. Without a single payer, the cost goes to the highest bidder as doctors are not exactly in a desperate situation.
There is also a much, much higher than usual asymmetry of knowledge. There's some asymmetry when a sleazy car salesman tells you that the crappy looking car runs great. But even if you're not a car expert, you can test his claims to some extent. Effective healthcare requires so much specialized knowledge that very few consumers have any basis to second guess what their doctor says. If their treatment is ineffective they can simply claim they did all they could or you would have been worse off if not for them. Most doctors are honorable, but some consciously or subconsciously recommend expensive procedures in questionable circumstances. Again, regulation under a single-payer system could help here.
Finally, need is very unpredictable for most people. Where need is predictable, private insurance will treat you like a hot potato. You can guess how much food youre going to need next week and about how much it will cost. You dont know if youre going to need an emergency surgery in the next year or even within your lifetime, or if it will cost a few thousand or hundreds of thousands of dollars. This necessitates some kind of insurance for pooling of risk, but then when the private insurance company sees that bill they often find it cheaper to use their mercenary army of lawyers to deny you coverage.
Healthcare throughout the world is facing a challenge because of aging populations. America has done worse than the other industrialized or post-industrial nations (except South Africa, which also relies on the private sector) on most measures, despite the fact that we spend dramatically more.
Whatever virtues you might wish the free market has, it will reliably push towards one goal: profit - not health. I would argue that the quest for profit doesn't always lead to bad outcomes, as Adam Smith argued, but in this case it does. This worked better, if not ideally, when our main source of mortality/morbidity was with acute infections and diseases as at the turn of the 20th century. The interventionist ideology that is emphasized in America more than elsewhere developed not only because some doctors and insurance companies are greedy, but also because it was effective versus these infectious diseases that used to kill people most. With these problems mostly dealt with in industrialized nations, we are now being killed by chronic conditions like diabetes, cancer, and heart disease. The way to deal with these is not acute intervention, as medicine in America is set up to do, but rather long-term prevention. A penny of prevention can literally be worth a dollar of intervention when you consider how expensive surgery can be. Furthermore, the private sector has demonstrated its incapability of effectively adapting to new times except for the purpose of making profit at the expense of patients. It is time for the government to take a bigger and smarter role.
It would be okay for the free market to handle healthcare if profit and effective healthcare were not incompatible. Unfortunately they are because, from the provider's perspective, prevention is not something to encourage because it is a lot less profitable than intervention (usu. surgery). Why would they want to get 1,000 dollars from a decade of doctor's visits when they could gain 100,000 dollars or more from the one surgery the patient needs without preventive care?
From a coverage perspective, preventive care is not something private insurance companies emphasize because it is unreliable whether or not they will see the benefit: the person covered often switches insurance companies. Then when somebody does have a health crisis, it is in their interest to deny them coverage and let them die if they can possibly legally do so. Hence their favorite phrase: Pre-existing condition. Sorry sir, you've been dying since the day you were born.
A single payer system, whether it be administered by states with federal matching funds or just an overall federal system, would definitely help us with this problem and others. I don't expect it to be amazingly efficient, but it would be easy for it to do better than the private sector has and with effective leadership could do very well. I am not convinced my state is competent enough to do this. However if it is done we will need to seek guidance from our own VHA, which made a dramatic and sustained improvement 10 years ago, as well as other countries like the Japanese and French. Since the government's goal would not be profit but rather breaking even and working within a budget, this could promote a movement towards evidence-based medicine, preventive care, and overall healthcare with the purpose of improving health, not profit.
Here is a list of the reforms I would suggest:
1. National health insurance with income-adjusted copays for interventionist tx, and free prevention-based care. Another consideration for copays is whether there is evidence to support the clinical effectiveness of the tx. The government can use its leverage through a quasi-single-payer system to bring costs down. (Quasi since supplemental insurance would be allowed, but probably not necessary)
2. More general practitioners, with an emphasis on prevention-based care and patient education. This could be facilitated with state or federally funded tuition forgiveness programs for doctors who choose to go into general practice. People need to learn to see their GP regularly to avoid crises, rather than wait until a crisis occurs.
3. Salaried doctors with bonuses for outcomes (pay for performance = P4P), P4P on the hospital level too. Greatly reduce hospital/clinic level reimbursements for interventions; modestly increase hospital/clinic reimbursements for prevention.
4. Electronic medical records and software like VistA. These help to coordinate care.
5. Evidence-based medicine.
6. Revise malpractice law in (at least) two ways:
a. Put a cap on pain and suffering damages that can be awarded, limit lawyer contingency fees, but still award full amounts for medical costs incurred as a result of a medical error.
b. Allow informed patient choice in addition to informed consent so that doctors/hospitals can provide unbiased decision-aids when a patient is considering undergoing an invasive procedure so that they can weigh the risks against their own priorities.
7. Provide better regulation of the pharmaceutical industry.
a. Require new drugs to be compared to both the existing treatment and a placebo at comparable doses if possible. In order to be approved the drug must show some kind of significant improvement over existing tx in some situation. (currently only placebo comparison is required, so we get a lot of copycat or me-too drugs).
b. The FDA needs more funding, and must be made independent of the industry it regulations, e.g. repeal user fees. Drug companies can currently legally pay money to expedite the approval process.
c. There should be no way to extend a drugs patent, e.g. by suing generic manufacturers or testing the drug in children, but the patent time should not begin to be used until the drug hits the market.
d. The government should be able to negotiate for better drug prices (one major problem with medicare is they cant by law).
e. Pharmacies should not be allowed to sell the prescribing patterns of individual doctors to pharmaceutical companies.
f. Drug companies should not provide continuing medical education to doctors.
g. Ban DTC ads.
h. Drug companies should be required to disclose and make publicly available basic financial information about R+D, marketing, and other costs vs. profits.
8. Eliminate the way special interests control politicians in America:
Scores of members of Congress, for example, accepted contributions from the same pharmaceutical companies that reaped millions of dollars of additional profit from the provision in Medicare Part D legislation that prevented the government from negotiating discount prescription prices for beneficiaries.
http://www.nytimes.com/2008/07/06/business/06view.html
