I am not in favor of messing with the insurance system for this purpose but have argued for a more direct approach. Under what I call a “no-give, no-take” rule if you are not willing to sign your organ donor card you go to the bottom of the list should you one day need an organ. Israel recently introduced a version of no-give, no take which gives those who previously signed their organ donor cards points pushing them up the list should they need an organ transplant–as a result, tens of thousands of people rushed to sign their organ donor cards.

What’s got Charles Johnson (the wrong-headed Charles Johnson of Little Green Footballs, not the right-headed anarchist Rad Geek) so worked up?

Now the GOP Wants to Permit Any Employer to Deny Contraception Coverage

What’s all this “permit” and “deny” stuff?

An employer doesn’t (or at least shouldn’t) have to offer health insurance as a job benefit at all (he or she may choose to do so, including as part of some contract negotiation or whatever, of course).

And if an employer does offer health insurance as a job benefit, excluding this or that item from said offering isn’t “denying” anyone anything, nor should any “permission” to exclude anything, nor any excuse for excluding anything, be required. As long as he’s not lying about what it is he’s offering, I’m free to take it, leave it, or try to negotiate something different.

There’s no “right” to force someone else pay for or deliver whatever health care you might happen to want, and there never will be, no matter how many times Johnson clicks his heels and shouts “war on women’s rights! … [W]ar on contraception!”

The whole “religious exemption” thing is just a distraction. I suspect that’s where you’ll find most objections to covering contraception in particular, for the simple reason that most employers and insurers would rather pay for contraception, vasectomies, tubal ligations, etc. than pay for pre-natal care and delivery of a baby, then cover that baby’s health care expenses as well. But the general principle extends far beyond religious objections.

Maybe my employer finds out that he or she can save $10 per employee per month by offering us policies that exclude sports injuries. Unless we have a contract specifying otherwise, why should he be mandatorily out $10 extra a month so that I can play rugby or ride bulls on the weekend?

Or maybe I’ve had myself snipped and my significant other has had her tubes tied. Why should we not be able to buy a policy that doesn’t cover (at an extra premium cost) a bunch of services we’re never going to need?

Hey, maybe … no, not just maybe … the details of what health insurance we buy (or don’t buy), or negotiate (or not) with our employers, are none of Barack Obama’s and Kathleen Sebelius’s business.

Princeton economist, Uwe Reinhardt, contributes regularly to The New York Times Economix Blog. Recently he wrote, in
“Health Care Payers Push Back Against Costs“ that high U.S. healthcare costs are driven by several factors:

• American’s over-use of high-cost/high-tech services owing to some American’s being over-insured.
• High administrative costs (mostly in the health insurance area)
• Higher prices paid by Americans for healthcare services and products

On this latter point – higher prices – he points to an imbalance of power between the buyers (and payers) vs. the suppliers of healthcare.

[...]higher prices are the product of a deliberate strategy, hashed out in our political bazaars between the supply side of health care and state and federal legislators, always to keep the payment side of our health system fragmented and relatively weak vis à vis the supply side of health care.

He also notes how difficult it is for patients to do price comparisons – “price opacity” he calls it. He saves his strongest reaction to the system of price discrimination found in healthcare today. Providers charge (and are paid) differently depending on who pays the bill. Insurance companies demand substantial discounts from hospitals, and Medicare reimbursements are significantly lower than provider costs.

Reinhardt warns providers to prepare for an era of increasing price information and comparisons, along with other purchasing initiatives.

To add my own commentary: Our public discourse on complex problems often veers towards finding the villain – the “bad guy.” Once identified that villain gets all of our intention, and if the political stars are aligned government legislation and regulation results. If healthcare costs are an inflated balloon, then pushing in on one portion will only cause the balloon to bulge out elsewhere. It would be a mistake to assume that our healthcare challenge would be fixed by just getting providers to reduce their prices.

More open price comparisons and a more straightforward pricing mechanism are two important elements in successful healthcare reform. With only some exceptions, providers (physicians, hospitals, drug companies, tech companies) are not looking for ways to extract more money from patients. They are taking steps to survive in a broken marketplace. Changing public attitudes about appropriate care, changing insurance to give patients more exposure to their decisions and choices, giving providers incentives to prescribe cost effective care, opening scope of practice laws to let well-trained but less expensive professionals provide some care, and maintaining vigilance over abuse of the patent and malpractice systems are all important steps to take.

In honor of the first week in our Healthcare Economics class, and the beginning of a 6 week session on healthcare via OLLI, here is an interesting report from The New York Times.

National health spending rose a slight 3.9 percent in 2010, as Americans delayed hospital care, doctor’s visits and prescription drug purchases for the second year in a row, the Obama administration reported Monday.

The recession, which lasted from December 2007 to June 2009, reined in the growth of health spending as many people lost jobs, income and health insurance, the government said in a report, published in the journal Health Affairs.

from The New York Times

There are a couple of takeaways from this news.

First, the reduction in spending on healthcare could mean a welcome, albeit temporary relief to those governments and organizations that pay for healthcare….BUT…no real relief for state and local agencies which provide/finance healthcare for poor people. Recessions, of course, result in greater numbers of people qualifying for government-supported care.

The other point is a reminder that some portion of healthcare services are discretionary. When healthcare spending was growing by 10 percent or more each year in the 1980s, that growth probably wasn’t driven by an increase in the need for services. Likewise the slower growth over the last several years is probably not due to the population getting healthier and needing fewer services. Instead, people moderated their demand for healthcare. They put off diagnostic tests, or did not follow through on treatments or prescriptions. Going in the other direction, hospitals routinely see increases in elective surgeries near the end of a calendar year, as people have already met insurance deductibles, and decide to seek care before those deductibles are reset in the new year.

Is this good news? Not necessarily. To the extent the people put off truly necessary tests and treatments, those delays may cost us more in the long run. To some extent, though, tough economic times force us to be more cautious about discretionary spending, and there may be very little impact on long run health status. There is the old saying that if you get a cold, it will take 7 days to go away, but if you see a doctor you’ll be cured in a week! One important element of effective healthcare reform is to introduce that sense of caution in our population. It is a delicate balance – not wanting to interfere with early testing and early, cost-effective treatment, but also discouraging care that has less impact on long term health.

Prices for medical care services and supplies also stayed roughly on par with general inflation during this last year, which is a change from the decades of the 1980s and 1990s where the medical care component of the consumer price index routinely outstripped regular price increases.

I wouldn’t have to polish my crystal ball very much to predict that spending increases for healthcare will pick up speed as the economy recovers. This remains the single most important issue in our nation’s federal deficit struggles.

When I went into solo practice of internal medicine in 1981, it was very easy to get a doctor to see a Medicare patient. All I had to do was make a phone call. A courteous receptionist answered. If the doctor couldn’t come to the phone right away, I could count on a prompt callback.

Consultants saw patients quickly, and generally called me to discuss their findings and advice. And very often there would also be a letter in the mail: “Thank you for referring this delightful patient to me.”

How things have changed! Now a doctor gets the phone menu, just as the patients do, and it often ends in voice mail. It might be a few days before a staff member calls back—usually with the news that “we are not accepting any new Medicare patients.” At best, my patient might be offered an appointment in several months.

One very fine gentleman, who had recently moved to a rural area, found it easier to fly to Tucson to see me than to get in to see a local internist. That was in 2009. Recently, he has become unable to travel, so I needed to find him a local doctor.

I tried to expedite matters by ordering him an immediate diagnostic test: an abdominal CT scan. I don’t think anyone could argue that it wasn’t indicated under the circumstances. One little problem: I am not enrolled in Medicare and don’t have the proper government-issued number to enter into the computer. A license to practice medicine is not enough. This National Provider Identifier (NPI) is supposed to protect the system against being defrauded. Without that number, the imaging facility could not get paid by Medicare.

“Why not use the radiologist’s number?” I asked. After all, he was the one who would get paid. Nope, a referral was required. How about a self-referral from the patient? Nope, we can’t allow patients to decide what tests they need. “The patient is willing to pay for his own test,” I said. Nope, if he’s on Medicare, they aren’t allowed to take his money.

They gave the patient 24 hours to find a properly enumerated doctor to countersign my order. Fortunately, he found a specialist willing to do so, and assume potential criminal liability for committing “waste, fraud, and abuse” by ordering a “medically unnecessary” study. (Fortunately for the patient, he turned out not to have cancer, but that could be bad news for the doctor.)

So this is the status of retired Americans. They can’t just walk into a facility and request a medical test, and pay for it with their very own money.

A man may be qualified to pilot a 747 across the Pacific, but once he’s on Medicare, he is unfit to make an unsupervised decision about his own medical care.

I did find my patient a doctor. None of the internists within a 150-mile radius who “take Medicare” are willing to take on a new Medicare patient. But through the website of the Association of American Physicians and Surgeons (www.aapsonline.org), I found a link to the Medicare carrier’s list of opted out physicians. They don’t “take Medicare,” but many are pleased to see older patients, for a reasonable fee. There was one internist on the list, 150 miles from my patient. She has a courteous and helpful assistant who actually answers the phone, and told me the charge for a new patient visit: $300.
Things could be worse—and already are much worse in Canada. The “soul-destroying search for a family doctor” is described in the Globe and Mail on Aug 21. The Ontario government’s program called Health Care Connect manages to link only 60 percent of patients with a doctor—although you might find a concierge doctor for $3,000 a year.

That’s the cost of medicine when it’s “free”—if you can find it at all. If ObamaCare is implemented, all Americans will be in the same boat. And guess who will get thrown overboard first.

Some new data out on Small Area Health Insurance Estimates from the census folks.

They have a tool there you can use to look this up yourself, but what I get is that for children (age 18 and under) in Pennsylania, Allegheny County is tied with Montgomery for the lowest percentage without health insurance at 3.9%.  The highest: 10% in Lancaster County.  Data is for 2009.

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