Health Care Reform?

This is an interesting piece from McClatchy about the apparent arrangement between some of the major stakeholders in the current health care economy to voluntarily attempt to reduce costs and to presumably pass the savings on to the consumer. Certainly this is a laudable goal, but I don’t see how it can make much of a difference, nor how it can be enforced in any meaningful way. One is reminded here of the rejoinders of the now disgraced John Edwards who poked fun at the other candidates’ health care approaches, noting that those with overwhelming power do not generally give it away, no matter how kindly they are petitioned.

Among the groups behind the pledge are the American Hospital Association, the American Medical Association, Pharmaceutical Research and Manufacturers of America, America's Health Insurance Plans, and the Service Employees International Union.

This should tell us something right there. With the exception of SEIU, these are the guys who own the system, and they are the same guys who pretty much own Congress, along with the banks and the energy companies. And note that we are talking about reducing the cost of the growth rate of health care costs, not the actual costs themselves, which will presumably rise at their current unacceptable rates less the proposed reduction of 1.5%.

This is another exercise in marketing, really a preemptive gesture by the major stakeholders to maintain the status quo in terms of how economic and political power is distributed within the system. Right now health care costs account for roughly 15% of GNP, a significantly larger proportion than other industrialized nations. The growth rate is generally thought to be around 4%. The only way to really affect these numbers is to interfere in the market in a very significant way, both in terms of administrative costs and actual reimbursement for services.

What I don’t get is why the mainstream Democrats and the Obama administration and substantial numbers of real people are going along with this. Well, I do actually sort of get it. In the one case, Congressional Democrats, they are owned by the special interests, and in the case of the administration, they are convinced that real, substantive change that alters the balance of power between the oligarchy and the population at large is impossible and probably undesirable. But I still don’t get why the ordinary people buy this stuff.

Look, nobody really complains about Medicare, do they? And what the advocates of single-payer universal health care are really talking about is an extension of that system to the population at large. Nevertheless we cannot seem to get this proposition on the table even as a competitive alternative to private insurance.

Medicare and other universal single-payer systems work because they drastically reduce administrative costs – there is one source of reimbursement to medical providers and one set of rules and entitlements – and because the single-payer has dominant market leverage, so as to be able to virtually dictate reimbursements, far in excess of the savings available through preferred networks that insurance providers typically negotiate. And yet hospitals and doctors and clinics are not refusing Medicare payments, are they?

What I am getting at is that that this whole health care issue is being framed in a manner that is detrimental to the public at large, and really also to the economy as well. It is being discussed as something uniquely American, filled with all the illusions that, for example, people now have the unfettered choice of who provides services and that medical care is not rationed under the current system simply because there are a lot of people who do not have insurance or who have inadequate coverage and so simply do not seek it. Whereas we should be starting out from the premise that medical care is a social cost and that competent medical care is an inherent right for everyone.