Archive for November, 2009
BREAST CANCER SCREENING, HEALTH INSURANCE, AND HEALTH CARE REFORM
The new breast cancer screening guidelines released last week, along with the supporting study, are among the most disputatious medical recommendations in recent memory. Critics on the right charge government rationing, while those on the left suspect an insurance company conspiracy to cut essential coverage. Adding gasoline to the fire is the even more heated health reform debate that has led its combatants to hijack the mammography issue to bolster their own particular views, pro and con.
To get past the politics, I read the study. It is hardly a page turner, but it’s a credible scientific analysis of the available data on breast cancer screening. A key question it addresses is how effective mammography is for women under age 50—an issue that has ping-ponged back and forth across the medical policy community for four decades. In this latest volley, the U.S. Preventive Services Task Force (USPSTF), citing the study, recommends “…against routine screening mammography in women aged 40 to 49 years.” But then it equivocates with, “The decision to start regular, biennial screening mammography before the age of 50 years should be an individual one and take patient context into account, including the patient’s values regarding specific benefits and harms.”
THE PROPER ROLE OF GOVERNMENT IN HEALTH CARE REFORM – PART 3: HOW REGULATED CONSUMER MARKETS WILL SUCCEED
In Part 1, I describe the market failure that has caused all the major problems in our dysfunctional health care system. Part 2 recommends straightforward government regulatory reforms that will correct this failure. Now, Part 3 describes how these market reforms will allow all Americans—finally and sustainably—to get their necessary health insurance and high-quality medical care at less than half of today’s cost. This is not deregulation of health care, but enlightened re-regulation to correct a fundamental market failure that the government and economists have ignored for decades.
The key action is to place America’s consumers firmly in charge with the money and the authority to make their own purchase decisions from insurers and medical providers that will be forced to actively compete with better value—higher quality, better customer service, and lower cost. This also makes consumers responsible for living healthy lives or else paying higher premiums if they don’t.
THE PROPER ROLE OF GOVERNMENT IN HEALTH CARE REFORM – PART 2: CREATING A HEALTH CARE MARKET
I wrote in Part 1 that medical care is an economic good. More specifically, it is a consumer good delivered directly to patients, primarily in the form of services. Experience has taught us that the most effective, efficient, and fair way to create and distribute consumer goods and services is through open consumer markets that allow each customer to determine a product’s value before deciding whether to purchase it with her limited available funds. Such value assessments require consumers to consider the answers to two fundamental questions:
- Which sellers’ are offering me products and services that will provide the best quality for my needs?
- Of those best sellers, which offers the lowest price?
In (slightly) technical terms, value equals quality divided by price, meaning that the higher the quality and/or the lower the price, the higher the resulting value. The challenge in getting higher quality, lower priced health care, therefore, lies in creating a consumer market for it. Actually, it means creating two markets, one for health insurance and one for medical services. But if we do the insurance market right, the second will naturally follow.
THE PROPER ROLE OF GOVERNMENT IN HEALTH CARE REFORM – PART I: MARKET FAILURE
As a proponent of market-based health care reform, I’m often accused of believing that free markets will cure what ails our broken health care system and that we just need to get government out of the way to make it all better. I believe no such thing. And I never use the term “free markets.” It too often connotes that markets can operate in the absence of government regulation. That’s not how it works.
I understand why so many people believe in “free” markets, because markets themselves are a natural phenomenon arising from fundamental human behavior. Certainly no government ever invented them. Markets just happened, because people want things they lack, and they have found they can get them in return for their own labor and produce. No one really understands why markets work, because they are such indescribably complex, nonlinear, adaptive systems. But somehow they do. They’re messy as hell, but they perform well enough to allow a paraphrase of Churchill’s famous comment on democracy: Market capitalism is the worst form of economic organization—except for all the others that have been tried.
THE EMPLOYER HEALTH CARE MANDATE DELUSION
There’s a common delusion making the rounds of Congress and The New York Times that says we must force employers to pay more of their employees’ health insurance costs in order to reduce the workers’ financial burdens. The problem is that employer insurance payments are simply one component of total employee compensation. Arbitrarily increasing this part will necessarily cut the funds available for wages and salaries. Mandating such behavior would constitute nothing less than an enforced reduction in worker pay for a government-favored use, i.e., to support a wasteful, inflationary, mediocre-quality medical system. Any way you cut it, the employer mandate burden would be borne squarely by America’s workers under the disingenuous guise of employer responsibility. Every reputable economist knows this. So do our cynical, dissembling members of Congress.
They would have us believe that the modern philosopher’s stone called legislation will magically make one plus one equal three. That’s the essence of the two Senate health reform bills and the House’s own 2000-page orgy of excess (HR-3962) that would exact penalties from employers that don’t provide enough health insurance.
