Tuesday, April 11, 2006

A healthy solution?

Massachusetts Gov. Mitt Romney touts his state's landmark health care reform on the conservative op-ed page of the Wall Street Journal. I haven't had time to study the fine print, but it appears not unlike the Swiss system in which individuals are required to purchase health insurance, and those with low incomes will receive subsidies to do so. It also includes a mechanism for automatically enrolling those eligible into Medicaid, because as Romney explains, 20 percent of the 500,000 or so uninsured Massachusetts residents are eligible for Medicaid but are not currently enrolled. It's a good idea, but it makes me wonder if it might make the plan more expensive than Romney lets on.

For Romney, a likely candidate for the Republican nomination for president in 2008, it's a smart move politically. The plan is centrist, offering something for everyone--expanded Medicaid coverage and insurance subsidies for liberals, health savings accounts for conservatives. It was passed by a Democratic-controlled Legislature, with the support of a conservative think tank and the backing, it would seem, of at least some of the business community. Granted, die-hard fiscal conservatives and libertarians won't like it, and it falls way, way short of the kind of universal health care favored by much of the left.

Nonetheless, as a Republican, Romney has co-opted what promises to be a major issue for Democrats over the next several years, perhaps allowing the pro-life Mormon to compete for swing voters. The plan may be a disaster, but it will be too soon to know by 2008. This is a good reminder why governors tend to have a clearer path to the White House than senators and House members.

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Blogger Sean McDaniel said...

Look, I love the UHC idea. That's one of the reasons I voted for Clinton in 1992. It's about time it's happening. Who knows, maybe it will catch on. Everywhere.

This is a country in which every person should be able to afford some type of coverage. One argument about UHC is that someone making $35,000 a year might not be able to afford the same coverage as a person with a $100,000 income. But if the lower end coverage is adequate, that's better than none at all.

The automatic enrollment in Medicaid is great too. No problems there. In fact, most of the plan seems solid. Except for addressing the issue of health care being so expensive in the first place.

So far, the only reference to savings in the MASS UHC plan seems to be of benefit to the state. One mention in the NY Times last week said that individual premium reductions would be minimal. Which means employers will still be struggling to pay the bill for providing health insurance to their employees — and people who pay 100 percent of their coverage out of pocket won't get any real relief. Unless they declare bankruptcy. Tax deductions still don't reduce the initial cash payout — or put that exact amount back in your bank account.

Romney writes that medical transparency provisions — whatever that means— will help consumers compare hospitals and costs. Sure, the next time I have a heart attack or I want my wife to have a baby somewhere cheaper than Magee, I'll shop around for the most affordable price. Truth is, hospital procedures tend to come on by surprise. leaving you little time to search for the best buy.

When it comes to health care, most people want the best treatment, not the lowest price. We're talking about lives here, not plasma TV screens or Honda Elements. Would you really want to go to the doctor who underbids all others? Who knows, maybe anesthetics are overrated. As a result, health care costs will push to higher levels — especially as medical advancements continue.

Without any checks on health insurance cost increases, one trend is sure to continue: employers will either reduce their contributions to employee health care premiums or eliminate them. After all, health insurance is a personal responsibility and requirement under the MASS plan. And don't think that Romney doesn't know that when he says the annual $295 penalty assessed on those companies that contribute nothing to employee health care is unnecessary. He's right. I think I know which choice many employers would make between paying up to $10,000 a year (or any lower amount) for just one employee's health care coverage or a fine less than $300.

No matter what Romney thinks, health care is still not on a level playing field. It's too expensive for nearly most Americans, single or married, to pay own their own.

By the way, I like the option to not participate if a person can prove capable of paying for services as needed. Now if I could only get the same provision for not chipping in that portion of my federal taxes used to protect me from Saddam's WMD. I think I've done a good job on my own so far.

Sure there are problems with the plan. Plenty of them But, it's a start. Maybe by time it hits PA, the kinks will be fewer.

11:26 PM

Blogger Jonathan Potts said...

I don't have time to respond at length right now, but you are correct about the transparency provisions. People do not "shop" for health care the way they do other goods. That is a big part of the problem with conservatives' free-market approach to health care reform. Many of their assumptions are flat-out wrong. Malcolm Gladwell had a good article about this in the New Yorker a few months back.

8:24 AM

Blogger Jonathan Potts said...

There are two main reasons to reform the health care system: to provide insurance for individuals who cannot afford it currently, and to alleviate the burden of rising health care costs from employers. Now, unlike a single-payer system, the Massachusetts plan will not relieve employers from paying for health care, so the only kind of success that it might be able to claim will be to arrest the double-digit increases in health care costs that are crippling many employers.

If health care costs in Massachusetts climb more slowly, keeping closer pace with inflation, then officials will at least be able to claim a partial victory, even if the intial cost reductions are modest. If, however, after an initial re-adjustment, costs resume skyrocketing, then it will be a failure.

Now, the Wall Street Journal in an editorial today called for deregulation of the health insurance market, to allow individuals more freedom to purchase plans available in other states, and dropping coverage mandates. I don't have a problem with either idea, but the latter could result in the same kind of rationing that conservatives fear from a single-payer system, only dictated by the market rather than government. In fact, people who have HMOs already live with a certain amount of rationing. If you're a libertarian, you may feel better when you are denied coverage by a private insurer, rather than the government. The rest of us might see a distinction without a difference.

8:49 PM

Blogger Sean McDaniel said...

Okay, to make everything equal consider this...free each and every employer of the burden of providing even $1 in payment for employee health care. I bet you see premiums drop when insurers realize that they couldn't count on big business (or small) to pick up the tab.And a hell of a lot more people would bitch about the price, just the way they do about cable TV.

Not to get personal here. But if you were paying the full amount of your health care, would you still support UHC? I do pay more than $1000 a month for medical insurance, and favor the idea.(Would $1,000/month payments seriously put a dent in your budget?) But if health insurance is going to be required, then the individual should pay it 100 percent. After all, does your employer pay your car insurance?

Jonathan, don't think I'm getting snarky. Because I think you're an extremely tolerant and open guy, and I respect that tremendously.But I imagine CMU provides a generous health care payment on your part (even if your pay may not be fantastic. I know, because I've worked in a university setting too.) It's easy to advocate UHC when someone else is paying the bills. That being said, I'm still in favor of the idea.

As for being denied by a private insurer instead of the government,no is always no. As for deregulation,it's done wonders in the airline and trucking industries. Then again, it's seemed to work with public utilities.

Now for something more important, what did you think of the Sopranos last Sunday?

11:39 PM

Blogger Jonathan Potts said...

Well, I've already endorsed the Swiss system, which puts the onus for paying for health care on the individual. And I've endorsed a government-funded system, which I would likely have to pay for through premiums or in the form of higher taxes.

I found "The Sopranos" to be a bit uneven this week--I may discuss more at length later.

8:29 AM


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