Broadcasting Misinformation: Planting Seeds of Fear

Inevitably, the debate over healthcare reform will inspire some to try to broadcast misinformation, sowing seeds of doubt, false hope or fear in the public mind.  I will try my best to rebut some of the more flagrant attempts, on both sides of the issue. In the past, I have complained that progressive single-payer advocates sometimes exaggerate just how much could be saved if we eliminated private insurers’ administrative costs from the nation’s healthcare bill here (For an excellent, even-handed analysis of administrative costs for private sector insurers compared to public sector insurers, see this Urban Institute report)

But this post is not about single-payer. (If you comment, please stick to the subject at hand. Posting off-topic messages is considered “trolling,” and your comment will be removed.)

Instead, in this post, I want to talk about an example of fear-mongering by conservatives. Thanks to reader Brad F. for sending me this link to an AP video available on Yahoo headlined “GOP Challenges Obama’s Healthcare Plan.” 

Open the site, and you’ll hear Congressman, Rep. Roy Blunt (Rep. Missouri) delivering his weekly Republican message on last Saturday. Blunt, who serves on the House Energy and Commerce Health Care subcommittee and chair the Health Care Solutions Working Group focuses on healthcare reform.

He begins by saying that he agrees with President Obama “that if you like your current health insurance plan, you should be allowed to keep it.” Then, Blunt tells a fib: “But that's not what is currently being discussed in Washington. Some people are spending a lot of time talking about how to spend more of your money on bigger government run programs.”

Here Blunt implies that liberals in Washington are no longer talking about letting you keep your employer-based insurance. This simply is not true.  Both the Obama plan and the plans being discussed by most other liberals, including Senate Finance chairman Max Baucus,  are very clear: a government-run plan (“Medicare for all) would be an alternative, but Americans would have a choice. They could stick with the plan they have now.

The Congressmen then suggests that if a government insurance plan is available, the plan you have now might disappear. “I'm concerned that  . . . [the government]  will eventually push out the private health care plans that millions of Americans enjoy today.”

Note the word “eventually.”  How is it that, over time, Medicare-for-all might push private health care plans out of the market? This could happen only if so many Americans preferred the government plan that private insurers could no longer find customers. In other words, Blunt is acknowledging that for-profit insurers might not be able to compete with the government run plan.

The Urban Institute is more optimistic about the outlook for private insurance: “Private insurers who are not adding much value and lack clout are likely to disappear in the face of public competition” But “Private plans would not disappear. Private plans that offer better services and greater access to providers, even at a somewhat higher cost than the public plans, would survive the competition in this environment. It is also conceivable that private plans offering a lower cost option—for example, lower premiums than the public plan, say by exploiting care management innovations, and network and payment rate limitations—could stake out a separate competitive niche in some markets. .  .  Integrated health systems, for example, would likely do well because of their inherent efficiencies.”

 Blunt then tries another scare tactic suggesting that if the government comes into the market-place, “This could cause your employer to simply stop offering coverage, hoping the government will pick up the slack.”

Why would your employer do that? Under virtually every progressive proposal for reform, if your employer stops offering you coverage, he has to pay into a pool that helps fund the public-sector plan.  Many employers would rather  continue offering their own coverage because they know their employees prefer a known (what they have now) to an unknown (a new government plan.) Moreover, they realize that if they drop benefits, and the amount they pay into the national pool does not equal the amount they are now spending on health benefits, some highly-valued employees will expect a pay raise to make up the difference. Employees (and their unions) understand that “total compensation” equals wages plus benefits. If benefits shrink, wages should go up—or employees are taking a pay cut. In the midst of a recession, employers do not want to lose their best employees to a rival that continues to offer benefits. And, they certainly don’t want to raise wages.

The only way employers are likely to begin backing out of health care in large numbers is if the government plan proves so popular that employees are dropping the employers’ insurance.  This seems to be what Conservatives like Rep. Blunt fear most: that the government plan will be too successful in offering Americans high quality coverage at a lower cost.  Admittedly, that would be disappointing for the for-profit  insurance industry, but the goal of healthcare reform is not to “bail out” the industry. The goal is to create a sustainable, affordable high quality system for all. If Medicare-for-all helps do that, more power to it.

Now Blunt switches tactics with remarkable speed. A minute ago, he was worrying that the public insurance might be too good. Here, he suggests it will be a nightmare: “Just imagine a health care system that looks like a government run operation most of us are all too familiar with – the local DMV. Lines, paper work, taking a number.  Or how about another government agency – the IRS.

“I don't want our health care to resemble that system and you probably don't either. That's why real competition is the key . . .”

Wait a minute. If the insurance Washington offers resembles the DMV, Americans won’t choose it. Problem solved. (As Rep. Blunt says, “real competition is the key.” Also, why assume that national Medicare-for-all will resemble a local DMV —or the IRS?  Wouldn’t it be more likely that Medicare-for-all will resemble  . . . well, Medicare itself ?   While it’s not perfect, few people stand on long lines to get their Medicare check. All in all it’s a relatively efficient system. Physicians tell me that, in contrast to many private insurers, Medicare actually pays its bill in 60 days. And patients rarely find themselves on the phone with Medicare, asking why it didn’t pay for a particular service.

Blunt then goes on to suggest that, in contrast to the private sector, “the government never gets the price right: overpaying for some services, underpaying for others.” 

How does he think private insurers make their shrewd decision about how much to pay? Since 2000, they have been following Medicare’s fee schedule very closely, adding 5% to 15% to government reimbursements.   One could argue that Medicare underpays for some services and overpays for others—but private insurers do too. Moreover, we know that in the coming year Medicare is scheduled to take a close look at its fee schedule, raising payments for more effective services, and lowering payments for less effective services, as both the Medicare Payment Advisory Commission and the Congressional Budget Office have recommended.  

 Some providers fear that a public-sector plan will pay hospitals and physicians too little. But as the Urban Institute points out in its recent report: “Public plans would have to keep physicians and hospitals reasonably happy, otherwise enrollees would exit to private plans.”  Moreover, “While the government will likely have considerable power to set provider payment rates, it is not likely to use all the market power it has available. The problem is that the government, as a strong buyer, becomes responsible for the health and stability of the system. If it limits hospital and physician payments too strictly, it faces the risk of perhaps causing hospital closures, slowing down the introduction of new technologies by more than is socially desirable, limiting access to physician services, and affecting the quality of individuals seeking medical education.”

Unlike a private company, the government is responsible for “the public good.” If it forgets that mission, voters will remind Congress, by voting legislators out of office.  When it comes to keeping their choice of doctor, the electorate is not likely to cut legislators much slack. By contrast, private for-profit insures are not accountable to the public.

Blunt’s next assertion turns the truth on its head: “Part of that comes from the backward way the government looks at problems. Washington is the only plac
e that tells you how much they care about something based on how much it costs, instead of how well it works.”  No, private insurers often decide “whether or not to cover a treatment “based on how much its costs instead of how well it works.”  They have to worry about profits for their shareholders.

 Meanwhile, this administration is tripling the amount of money that it plans to spend on “comparative effectiveness research.”  Why do you suppose they are doing that? Because they don’t care “how well a treatment works.?

 In fact, Medicare cares very much about the long-term benefit of the services and products it covers because it knows that its patients are with the system for life.. Private insurers, on the other hand, know that their customers are likely to leave them every time they change jobs. This gives them less reason to worry about the long-term benefits and risks of care.

Finally Blunt ended his Saturday sermon with a Big Lie: “America has the best doctors, health care providers and hospitals in the world. Republicans will lead the effort to make health care work for Americans. We'll also lead the fight against any proposals that undermine your ability to get the treatment the doctor you choose recommends.”

As HealthBeat has pointed out in the past, numerous studies. reveal that the U.S. does not offer the world’s best healthcare. Far from it.  As I explain here. “five-year survival rates” for various cancers often distort comparisons, making U.S. outcomes look better than they are.

As for “getting the treatment  . . . your doctor recommends” we know that part of the problem in the U.S is that too many doctors do not practice evidence-based medicine.  This is why the Obama administration wants to offer them research which provides head to head comparisons revealing how particular patients fare when they receive rival treatments. Physicians can use that information as a guideline (not a rule) to suggest what might be most effective for a patient who fits a particular profile. 

Note, the UK makes extensive use of such research to issue guidelines. But it doesn’t   tells physicians what to do. Doctors comply with the guidelines about 89% of the time.

In other words, they find the information valuable, but don’t feel compelled to use it.

28 thoughts on “Broadcasting Misinformation: Planting Seeds of Fear

  1. Maggie, How come we don’t get to hear people like you on networks? Why are reliable people with your expertise not fronline informers? Unbelievable what I sometimes hear on Fox network etc.

  2. Two points:
    1. There is an interview by Ezra Klein of Andy Stern of SEIU here:
    The point that Stern makes that I haven’t heard before is that employers might want to keep providing coverage because they feel this gives them some control over costs, while just paying into a general fund wouldn’t.
    Given how obsessive CEO’s are about their power (see irrational union hatred as an example) this sounds plausible.
    The second point has to do with substituting wages for benefits. There has been some discussion of this on economics sites recently and the crucial factor is the “elasticity” of the labor market.
    Right now, but also for the past 20 years, all but the highest paid have had little power in wage negotiations. So, it is quite possible that employers would drop health coverage and workers wouldn’t be able to demand higher wages to compensate. There are plenty of present examples, with both health care and retirement.
    One could say that competition in the benefits area will only matter if unionization returns.

  3. Outstanding as usual.
    One point I would like to see more clearly stated in all discussions regarding health care. In all cases the word “program” is muddy. Health care is two parts: CARE and ADMINISTRATION. Providers furnish actual care. Administrators and insurance plans manage (or mismanage) the financial details.
    Medicare, like FEHBP, is a government insurance plan. But the VA and military hospitals and dispensaries all over the world are actual PROVIDERS of health care. I have no idea what Tricare and the Indian health service are, but they are two more tiers in what passes for “government plans.”
    So far I have not heard mention of community health clinics, but I believe they represent a basic, if primitive, infrastructure for actually PROVIDING some level of health care.
    Several years ago mental health institutions dumped loads of patients into the streets in a misguided effort called “deinstitutionalization.” It failed horribly because the community mental health clinics which were supposed to take up the task never, for whatever reason, did so.
    I think local clinics would be an excellent way to PROVIDE care. And there is no reason that INSURANCE plans would recognize in them a very economical way to keep their risk pools healthy by better access to well care and chronic disease maintenance.

  4. Off topic. Sorry about that. But you did such a masterful job of eviscerating Blunt and the fearmongers all I might add would be “Amen.”

  5. Very few politicians from the right have any credibility on health care reform
    The Republican Party is embarrassingly out of touch on health care rendering them VERY VULNERABLE on this go-around
    If the DEMS don’t know that- shame on them.
    Dr. Rick Lippin

  6. Maggie,
    I’ve commented on level playing field competition more than once so I won’t do so again here. However, one aspect of the analysis that you might be misinterpreting goes like this: Suppose a large employer currently offers a generous benefits package to its employees at a cost of 15% of payroll which is not uncommon. Under a reform driven play or pay approach, that employer may be able to drop its current insurance and pay, say, 7% or 8% of payroll into a government fund to provide public coverage instead. The employer may or may not be willing to give most or all of the savings back to the employees in higher wages knowing that future wage growth is likely to be considerably less than the growth rate of future healthcare costs if history is any guide. Unionized workers could even be enthusiastic about such a deal given the auto industry’s current poor fiscal health (to put it mildly) and the experience of what happened between 2001-2003 when most of the steel industry went through bankruptcy and many thousands of retired and still active steelworkers lost their health insurance coverage.
    A Congress and an Administration that would like to make a big push toward a single payer system could legislate a public option as the ONLY choice for those who don’t have access to employer provided health insurance while, at the same time, in effect, give employers an offer they can’t refuse to induce them to drop their current offerings and pay considerably less than they do now into a government fund instead, whether or not they choose give all or most of the savings back to their employees in higher wages. It’s a sneaky approach, and I wouldn’t blame private insurers if they are worried about such a strategy materially eroding their market share even if they can offer a product that is fully competitive with a government plan at comparable cost.

  7. As health care keeps churning into a business, private insurers will keep placating physicians because they fit into their overall plan. This has happen in the tort-deform arena and in the medical vendor arena. But businesses will no longer stand still for the exorbitant health care costs and the consortiums will start creating their own health care systems and mitigate expensive and profitable services. Doctors will ultimately have to become employed by the corporations, because they control employee health care contracts. There is one thing that can be said about free-market executives, they believe in profit as long as it is they who are making it and no one else is. That’s the way business works.
    We can choose to have a Medicare-for-all system, with proper funding and fair reimbursements, or continue having an HMO-for-all system run by the corporate consortiums whose main goal is cutting costs (services) and increasing profits for itself and/or shareholders, rather than providing high quality health care. Medicare-for-all is not socialized medicine because doctors and hospitals remain as independent contractors. Under the present HMO-for-all type systems, doctors are becoming employees of the hospitals, instead of remaining as independent contractors.
    A Medicare-for-all system will not harm health care competitiveness because competitiveness does not exist in present market-driven medicine. Our market-based health care system is driving manufacturers and jobs out of the country. The big-three auto manufactureres make more automobiles outside the United States than inside because their per-employee costs are drastically lower on the outside than on the inside. This happens to many other industries as well.

  8. Maggie, I agree with Ray you should be runnin’ with, er I mean over, the Big Dogs. You must get a publicist, we want you debating for us on FOX News, CNN, Bill Maher, CBS, NBC, ABC, Good Morning America…copy and paste our pleas to TCF and your publisher. Heck you should have your own show.

  9. Robert
    Thanks for you comment
    (Will be back to reply to other comments tomorrow-
    Robert —
    I totally agree that amployers may “want to keep providing coverage because they feel this gives them some control over costs, while just paying into a general fund wouldn’t”
    I also agree that, unless wokers are unionized, most would not be likley to get higher wages when they lose benefits–certainly not in this economy.
    But the highest-paid (and presumably most valued) workers would demand higher wages (which is why I said “some workers”)–
    and it could be hard for employers to withdraw benefits and raise wages only for “some workers.”

  10. Regarding employers who think they can do a better job of controlling healthcare costs than just paying into a fund, they are usually referring to wellness and disease management programs. While some employers claim they save in the range of $3 for every $1 they spend on these programs, the overall impact on their total medical spending is quite small. When I’ve asked several large companies that have pursued this strategy what impact it had on their number of hospital inpatient days per thousand members, the usual answer is: none, at least so far. Since hospital costs, both inpatient and outpatient are, by far, the largest component of healthcare costs for all payers, the payoff (so far) from wellness and disease management programs is underwhelming at best.

  11. Blunt’s speech was, of course, disingenuous at best — at worst, it was calculated lies. Like everybody, I think this will be a very difficult process with some bitter mud-slinging. But for the life of me I can’t understand what the Republican plan is. Is it simply the status quo, tinkering a bit with the status quo around the edges, or what? The one healthcare measure they did enact was a massive, unfunded mandate that was a windfall for the drug companies. This does not make me hopeful about their plans.
    As Maggie has pointed out numerous times, Medicare actually works pretty well. The payment calculations are screwy and need adjustment, but the system itself functions reasonably well with reasonable overhead. Most voters know somebody — parents, grandparents — on Medicare. If the GOP chooses to bash Medicare as part of their strategy, I think that strategy will misfire. Medicare is not the DMV nor is it the Post Office.
    I also think the GOP should have learned from the last election that crudely misrepresenting what Obama says will also backfire — he is nothing if not an eloquent explainer, and he could easily make the GOP lose what credibility they have left. So speeches like Blunts could play right into Obama’s hands.

  12. two things I know are:
    1. Blunt won’t have a significant role in passing reform.
    2. telling folks America’s healthcare isn’t best is a losing argument.
    to take them in turn.
    legislation will ultimately be passed as the stimulus bill was, with most Democrats, perhaps a few republicans and support from the industries/stakeholders involved. the Republicans will once again by bystanders. key task here in keeping those who may support the bill on board.
    data notwithstanding, people think the care they’re getting is best which is why they’re so conservative about change. they acknowledge others don’t get optimal care, but are unwilling to sacrifice what they receive now to resolve that problem. logic is same as why middle income people strongly support capital gains taxes or estate tax repeal. telling folks their perception of their care is wrong — and it often is — is a political loser from the get go.

  13. Jim Jaffe said:
    “2. telling folks America’s healthcare isn’t best is a losing argument.”
    I believe this is more of a misinformation problem. If the media and the medical profession spent as much time explaining the IOM report of a few years ago, which told that medical errors were one of the largest causes of death in America, I believe folks might be more doubtful about what you say. Throw in the unreported drug studies about bad side effects of many of the current drugs and, the current reform efforts would go a lot easier, IMHO!!

  14. The fear mongers are on the left and the right, to be sure. Why? There will be losers when the final program(s) are hammered out by Congress and the Administration.
    Those that want to see insurance companies go away through single payer, will lose if insurance companies are still in the game. Those on the right that want to hold on to the status quo do not want to see any further government involvement because some of their constituents will be eliminated from the game or at least be less well off, including insurance company employees who will surely lose their jobs.
    Medicare outsources administration to the insurance companies right now – so single payer proponents will never eliminate insurance companies. Presently, politically connected insurance companies receive bids to administer Medicare. Senate Budget Chair Kent Conrad (D-ND) has an interest in helping his constituents in Fargo at Norvidian. Other members of Congress likely had constituents bidding on the same business. Someone has to lose.
    In a Medicare-for-all world, there will be bigger contracts to award with winners and losers. Insurance companies won’t go away and neither will the politics (i.e. fear mongering and grandstanding). But some insurance companies will certainly lose.
    Only a few, such as Aetna, United Healthcare and CIGNA offer almost all products in all states. Most, such as the Blue Cross and Blue Shield Plans, which are independent health plans operating under the umbrella of the Blue Cross and Blue Shield Association of America, cannot compete across state lines.
    The Blues may be among the biggest of losers. Some, such as Anthem, may be able to compete based on their size of cobbled together Blues plans.
    The Blues are inherently a political animal. States chartered individual Blues plans and must approve of their every move. Many states have stymied their Blues plans as the plans try to change their charters to better compete. In their charter, the Blues were created by state legislation as an insurer of last resort.
    State regulators will lose, too, as ERISA now keeps most insurance regulation a purview of the states. A public insurance option will modify ERISA and eliminate state regulation and therefore reduce the power of the state insurance commissioners and the state attorneys general.
    Competition should not be feared. It should be welcomed. Much as when HMOs gained their largest share of market in the late 80s and early 90s, the government run program to be determined will fare well in the beginning. And as with the HMOs, when the government plans have wrung out as much savings as they can, the rate of increase in costs will make private insurance look better. The only difference is the government’s ability to tax to keep the government run plan competitive through subsidization. I believe the private sector can and needs to compete.
    The left and the right are both wrong to fear change. Competition is what will keep the knife edge sharp. The legislators and administrators must keep the playing field level. Consumers and constituents must insist upon it.

  15. I am a product development manager at an insurance company and made a similar argument on my blog a few days ago but not with your elegance. There are government sponsored health plans currently called Medicare and Medicaid and they sell because they are either free or $96.40/month but due to low provider reimbursement, access is difficult (50% of providers in Washington do not accept traditional Medicare due to low reimbursement) and they are extraordinarily complex.
    If private insurance companies can’t compete with government plans, than we should not be in business.
    The government has a track record and resources to set prices but are not good at customer service, have no medical management capabilities, nor any provider relations skills. Sucessful insurance companies are good at those 3 things and can thus outcompete a government plan.
    The GOP is tacking politically as you said and hopefully the Obama administration will call their bluff.

  16. Thanks Maggie
    Another great post, with outstanding discussants whom you have attracted.
    Market-based healthcare is based on buyers and sellers coming together with similar information, ie buyers have sufficient information to evaluate sellers’ claims.
    The other premise underlying economic analysis is that buyers make rational choices.
    As a physician, MBA, and patient, I confess, as I evaluate choices to replace my present $23,000/ year HMO policy offered by Harvard Pilgrim Healthcare, that I see data rather than information, my choices of plans are limited if I want to remain with my present PCP, and rational analysis is difficult if, as insurers tell you, you are buying “peace of mind,” as described in Charlie Baker’s Blog,

  17. Great post and civilized comments. This is the sort of discussion we need–envisioning how the various proposals for reform would impact the various stakeholders involved: a small business owner with six employees; a large employer with 2000 employees; a self-employed farmer or musician; a union worker who still has a job; a union retiree; a recent college graduate with heavy tuition debt; a family physician in a small rural community; a neurosurgeon in a large city; a medical practice with 5 physicians sharing office staff; an infectious diseases specialist who must order multiple tests; a mental health clinic; a mental health patient with a recurring need for meds and treatment; a wheelchair manufacturer; a medical IT software vendor; a medical laboratory; a pharmacist; a well-off banker with a health savings account; a middle income family with three children; a 52-year-old cancer victim who has lost her job and coverage due to illness; a kidney dialysis patient, a patient awaiting an organ transplant, an 85-yr-old in need of hip surgery, a hospice patient; a 25 year old college student with type I diabetes about to go off his parents’ policy; a recent college graduate with heavy tuition debt; a health insurance company employing 5000 people; the CEO and shareholders of that HMO; a clerical worker for that HMO; a low-income working parent with a high deductible whose child has a painful earache; the partner in a same sex union in a state where a partner’s rights to health care coverage are not recognized; an individual injured in the workplace, entitled to workman’s comp; a hospital with a high percentage of indigent patients, etc.
    You get the picture. How would these “cases” be impacted under the proposals being discussed: (a) an all private plan with a universal mandate; (b) a public-private mix approximating the status quo; (c) a publicly funded single payer plan (d) a voucher plan paid for by VAT tax; (e) a public plan supplemented by regulated, nonprofit insurers; and (f) a hybrid plan whereby a public Medicare-type option competes with private plans, etc.
    You get the point. Real people are impacted by policy decisions.

  18. Maggie, you should be on the tv networks. I have not heard of hardly anyone on this subject, except on FOX. You should get on BILL MAHR’S show. We need more than just the internet.

  19. Maggie,
    We all agree that the healthcare system needs to be fixed. However extreme care should be use to make sure new policies don’t make it worst. Policy makers need to engage in a constructive dialog design to achieve a better system not spreading fear. However they must be aware of the law of unintended consequences and Newton’s third law of motion ‘For every action there is an equal and opposite reaction’. Here are some facts that raise questions that deserve answers:
    • The largest job growth rate is in healthcare. Why?
    • In recent years seven hospitals closed in New Jersey and many others are in trouble. Why?
    • Out of four OBGYN doctors servicing a NW New Jersey Hospital, two dropped OB. Why?
    • There is a shortage of primary care physicians. Some of them have already opted out of Medicare and others have gone completely into concierge practices. Why?
    By the way What ever happened to the “Essentials” in your May 29, 2008 post? I love the two part post “A fresh look at Healthcare Reform’ along with No “Magic Bullets” If the “essentials” are not there the plan is not going to work.

  20. Have there actually been survey’s done about what “most employers” would prefer? I’m willing to bet “most employers” wouldn’t want to deal with or be involved in health insurance for employees at all. Just curious.

  21. Linda,
    Employers offer benefits for a couple of reasons, mostly due to government regulation.
    1. Benefits were offered as a way to compensate employees during the WWII, as wage freezes were put into place by the federal government. Employees then became accustomed to receiving benefits as part of their job. Employers also recognized the benefit to having satisfied and productive employees.
    2. States regulate to whom an insurance company may issue a group health contract. There are three specific eligible groups in all states: Government entities, Unions and Employers. Much of the job lock concerns related to health insurance are due directly to these rigid state regulations. When the Republicans had control of the House, they passed Association Health Plan legislation eight times. When the Republicans controlled the Senate, they could not get past a filibuster and the Democratic led Senate killed it in committee on its last try over a year ago. If association plans passed, employers would be rid of the necessity to offer coverage and consumers would be free of job lock and able to choose from among many association plans from which they would be able to move to and from at their choosing and to their benefit.
    3. Those employers that do not offer benefits are often looked down upon as not taking good care of their employees. Unions often seek to exploit this shortcoming, so employers must be good corporate citizens and defensive of union organizing. The media/public opinion has for years been pounding those employers not offering benefits.

  22. Ray, Hootsbuddy, Barry, Dr. Rick, Gregory, Chris, Lisa,
    Barry (2nd post ) Jim,
    NG, (I’ll be back later or tomorrow to respond to the rest of the comments.
    A very good thread–thank you!
    Thank you.
    I’m afaid Fox isn’t looking for information; it’s looking for people who will spout its party line.
    In general, the networks prefer happy news to hard, investigative reporting.
    “Sad news” is okay–mother of four has breat cancer–
    but not news that questions our healthcare system.
    There are exceptions, of course– for instance Rachel Maddow.
    I entirely agree about community clnics.
    The good news: the president’s fiscal stimulus package gives HRSA (the agency that oversees some 7,000 community clinics) $2.5 billion to spend for improvements to health care facilities and training medical professionals.
    On healthcare vs. administraton– sometime the administrators (who pay for the care) and the providers are one.
    For instance, Kaiser has two parts: one part is an insurer; one part is its hospitals and doctors.
    Geisinger provides healthcare and also insures some of its patients.
    And the VA both provides the care and pays for it out of the VA budget (separate from the Medicare budget.)
    Often, it can work out very well if the provider and insurer are one: it puts them on the same page. Otherwise, providers tend to fight for more money while insuers try to keep costs down. IF they are one company, they understand that they both benefit if they keep patients heatlhy. (Of course this works only if they are one intelligent
    And thanks for your second coment.
    Dr. Rick–
    Yes, the Republicans just don’t seem to have any ideas on health care reform. Too many of them are content with the status-quo.
    Employers who don’t “play” are gong to be required to put more than 7% or 8% into a public fund. We can’t afford universal coverage
    if they don’t “pay” as much as they are now paying for their own employees’ benefits–plus
    a small inflaiton increase each year.
    Smaller employers probably won’t be required to contribute as much, but
    larger employers will have to.
    The point of heatlh care reform is not to provide savings for employers today– though part of the point is to bring down healthcare inflation so that they don’t face 6% to 8% increases,year after year, in the future.
    But if we are going to cover all of the uninsured and underinsured–many of them very poor people– it is gong to cost at least as much as we are spending now to provide good coverage for , maybe, 75% of the popoulation.
    Keep in mind that while healthcare reform will give the poor access to medical care, we won’t be lifting them out of poverty.
    Many of the problems that cause poor health will continue– stress, depression, and self-medicating with alcohol, drugs, tobacco. Also poor air quality, poor education
    (which makes it less likely that poor people will do a good job of self-managing chronic diseases)etc.
    In the past, we have saved a great deal of money because poor people without access to health care die sooner than the rest of us.
    With access to care, they should live longer–though not as long as well-educated affluent people.
    Still, the alcoholic who would have died at 51 without access to care might now live to 58. But unless his life changes, he’ll probably continue drinking. And during those extra 7 years he is likely to need some pretty expensive care as his body deteriorates.
    (We won’t give him a liver transplant; today we rarely give alcoholics liver transplants unless they manage to stop drinking for a considerable period of time. And they rarely do.)
    If we actually manage to cut enough waste that we are able to cover all of the currently uninsured and underinsured people for the same percentage of GDP that we are spending now–and improve the quality of care for everyone, while
    keeping future health care inflation down to something that equals GDP growth, I would say that we will have done very well.
    So you can see why employers are going to have to pay as much as they do now.
    There is no way the government will give them “an offer they can’t refuse.”
    And no sane person in government (i.e. Peter O, or Obama) wants employers to suddenly drop insurance and throw millions of Americans into a government system.
    It would be complete chaos. We couldn’t handle it.
    If Americans choose to gradually move from private insurance to public-sector insurance, that’s one thing—but we’re not equipped for a tsunami.
    When we “suddenly” put seniors on Medicare back in 1965, we were talking about about the relatively small segment of the population that was over 65 (many people did not live past 65 back then, partially because they didn’t have healthcare). And it was a much smaller population.
    Finally, the care we could offer was much more limited.
    Today we have 6000 different drugs, 4000 different procedures . . .
    I don’t know the numbers from 1965 but they were much, much lower.
    Medical technology really took off after
    On the big three automakers: they are in so much trouble because for years, they have made terrible cars.
    In my lifetime, they have made:
    — cars that blew up when in rear-end collision. Everyone in the vehicle engulfed in flames. The manufactuer knew about the problem but after doing a cost-benefit analysis decided it would be less expensive just to pay generous settlements ot the relatives of the dead rather than withdrawing the car from the market.
    I’ve never heard of BMW–or any of the Japanese companies –doing anything like that, have you? (This is why my husband only drives very, very old BMW that he buys for a song and then has completely restored. Very safe , reliable cars. And they’re also quite beautiful.)
    American automakers also refused to put seat belts in cars- for years–even though it was clear ths woudl save lives. Ralph
    Nader had to make a life’s work of getting them to do the right thing.
    Then there were the American cars of the 70s– why do you think so many people bought Japanese cars instead? They were affordable and by and large, their repair record swas better.
    Then came the SUVs of the 1990s. Even I knew that the price of oil was going to soar in coming years. (And I’m not an auto executive.)
    These hugely over-priced often unsafe gas-guzzling cars were an enormous mistake. The industry is now paying for it.
    Of course, along the way, Detroit did produce some great, safe cars–but they tended to be over-priced and usually not fuel-efficient.
    I do feel badly for the autoworkers who have lost their jobs and their families. But I think the auto executives have overlayed the role that healthcare costs played in the debacle.
    Health care inflation congributed to their problems but the prime cause was basic: a poor product.
    As for HMOs– the best care in the U.S. today is coming from “managed care” at places like Kaiser, the VA, Geisinger, Community Health Care in the state of Washington.
    Medicare fee-for-service care is much more expensive and not as good because it is not evidence-based. If we cut the waste we could improve it, but it still won’t be as good as Geisinger unless we get away from fee-for-sevice (which we will do eventually)
    This is why we need a hybrid system like the one Obama suggests. Private sector insurers will have to be heavily regulated: they have already agreed to guaranteed issue and will have to agree to community rating as well as very strict rules about what they must cover.
    As I have said in the past, I don’t think most for-profit insurers will survive, but many not-for-profits will and right now, some of them are better than Medicare.
    In the long run, I can see not-for-profits competing with Medicare on quality–not price. (Price competition does not work in the healthcare market.
    Competition on quality can–which is why Kaiser has remained so succcessful in
    California. It’s network of doctors is good; it practices evidence-based medicine and it has healthcare IT that works fairly well.
    Lisa –hate to break it to you, but my publisher (Harper-Collins) didn’t like Money-Driven Medicine. They found it “depressing.” And, politically, probably not their cup of tea. (too critical of profit-driven medicine.)
    The good news is that my film producer, Alex Gibney, does like the book.
    You are right–“wellness” and “disase management” programs have been hyped beyond what they seem able to accomplish, at least at this pont.
    Having said that I would add that some companies have done very smart things. Pitney Bowes
    eliminated all co-pays and deductibles for certain important preventive and chronic disease care, and this, plus other programs was keepig a lid on their health care costs.
    But the person running the Pitney Bowes program was an MD (Gerry Ford’s doctor when he was in the
    White House) and a very smart MD. Too often, these program are run by businessmen who just don’t understand much about medicine–and human behavior.
    The Republicans now in Congress are by and large very conservative republicans. (Rove drove the moderates out of the party).
    And for the last 29 years, the conservative goal has been to perserve, conserve and accumulate wealth at the top of the eocnomic ladder. That means trying to preserve the status quo, even as it is breaking up all around us. . .
    You’re right that Medicare works “reasonablly well”–though as I pointed out earlier in this response, Medicare overpays for too much ineffective treatment, and fee-for-service encourages too much volume. . .
    Still, Medicare is perfectly fixable. It just needs a strong dose of evidence-based medicine.
    And the Republicans are, as you say, very foolish to bash Medicare. It’s a very popular program.
    And, yes, Obama is eloquent. This is such a relief.
    I agree that most Americans do not want to hear that their healthcare is not the best. It’s scarey.
    But it is somethign that must be said. The only way to contain costs and lift quality is to start steering Americans away from the degree of over-treatment that so many are accustomed to.
    This means explaning that some of this treatment wasn’t good for them.
    Obama has a very nice way of putting things– so he may be able to use his pulpit to educate America.
    Also, there is a rumor that
    Don Berwick will become head of Medicare.
    Don’t know if you’ve ever heard him speak– but he is even better than Obama.
    Finally, our economy is falling apart, adn the high cost of healthcare is a major part of the problem. We can’t coddle people anymore: we have to tell them what they don’t want to hear, but need to hear.
    Finally, I’m told that the administration does not have the votes to get healthcare reform through the Senate–not unless they give up the public-sector Medicare for all as an alternative to private insurance.
    “No Republican will vote for it.”
    This is a knowledgable source . ..
    I’m also told that both Obama and Ted Kennedy are unwilling to cave on the public sector alternative.
    So I think this will be harder than the fiscal stimulus package.
    The administration will get part of health care reform, but if my source is right, they won’t be able to pass universal coverage this year.
    I’ll write about this only when I know more. My source could be wrong. I don’t want to throw cold water on anything while the proces is unfolding.
    But the insurers have drawn the line in the sand on this one. And while Obama keeps reaching out for bipartisan compromise, the conservatives don’t seem open to compromise.
    Yes, I think it is a matter of educating the public. Some of the information about risky drugs going on the market, drug companies suppressing reserach and hospital errors have begun to appear in the mainstream press in recent years. . . .
    I’ll be back to respond to the rest of your comments.

  23. “Blunt is acknowledging that for-profit insurers might not be able to compete with the government run plan.” I don’t understand why people think that Medicare and other public plans “compete” with private ones in a traditional sense. It would be impossible for a private plan, especially one subject to high degree of regulation (which Obama appears poised to increase with innovations like “guaranteed issue,” etc) can ever “compete” with programs like Medicare that raise money by taxes and determine their own reimbursement rates by law. This is not a “level playing field” by any stretch of the imagination. And I imagine that’s what Blunt means. Very few seniors have private alternatives to Medicare. Of course there is a supplemental insurance industry, but that is not what most people have in mind when Obama promises that you can keep your current plan.

  24. Scott & Rob–
    No problem.
    Lisa has been commenting on this blog for a very long time. I know her fairly well–well enough to know that she was not really offended.
    Most of the time, people on this blog are pretty friendly, even when they disagree.
    You are right: competition between a public sector plan and private insurers would not be free market “competition” in the traditional sense.
    In a free market, there are few regulations; it’s more of a no-holds-barred competition: if you can find an advantage over your rival, you are expected to exploit it.
    (In this context, finding an advantage would mean figuring out a way to attract more very healthy customers and to avoid sick customers. For example, by offering discoutns on gym memberships, you would be likey to draw younger, healthier customers. High co-pays for cancer drugs woudl discourage the very sick. )
    From a shareholder’s point of view, that makes sense.
    But as healthcare eocnomist Rashie Fein says, “We don’t just live in an economy. We live in a society.”
    And as members of the society, many of us want sick people to be able to afford health insurance.
    That means “guaranteed issue” and “community rating” (anyone can buy health insurance and insurers cannot charge the sick or the old anymore than anyone else in their community.)
    On whether private insurers can compete in offering comprehensive insurance: they do it in
    And insurers there are tightly regulated.
    So it can happen. But I agree, it’s very hard–and probably more likely that non-profit private insurers could do it.
    The added burden of providing profits for shareholders, and meeting Wall STreet’s short term expectations may well be more than for-profit insurers can manage.

  25. My mom’s name is Linda, it’s not a bad name, I get called Linda a lot for some reason. Maggie, Harper Collins likes books that S E L L whatever their content is. If they’re not going to do any publicity then maybe the Gibney people will. Surely somewhere in your vast world somebody can start getting you some bookings. By the way, the other people on this blog who’ve been suggesting the same thing were not coached by me, I don’t even know them. TCF should have a publicity person. Somebody. Is there anybody out there who can help get Maggie booked on FOX News, The Bill Maher Show, CNN interview, set up a televised debate with Rick Scott? We’re not looking for publicists who charge $50k for a “video tour” anybody who knows news producers, guest booker producers, etc. C’mon.

  26. You are correct. Fear mongering about health care reform is a terrible tactic used by the extremes of opinion.
    What’s more fearful is how much our current system costs individuals and hurts economic security. The US is fatter than any other nation because people don’t have relationships with general doctors, rather they use the expensive specialty care system to ameliorate symptoms.
    The foundation of any reform needs to emphasize prevention and primary care and convey the benefit of doing so, both in terms of cost savings and productivity. The ‘culture’ of medicine will change only if, like in the financial markets, incentives are aligned properly.
    Will healthcare finances be the next expose` on cable news shows like we have seen regarding AIG, Wall Street and Bernie Madoff?