August 9, 2009

More on healthcare and an irresponsible opposition

Steven Pearlstein - Steven Pearlstein: Republicans Propagating Falsehoods in Attacks on Health-Care Reform -
"By poisoning the political well, they've given up any pretense of being the loyal opposition. They've become political terrorists, willing to say or do anything to prevent the country from reaching a consensus on one of its most serious domestic problems.

There are lots of valid criticisms that can be made against the health reform plans moving through Congress -- I've made a few myself. But there is no credible way to look at what has been proposed by the president or any congressional committee and conclude that these will result in a government takeover of the health-care system. That is a flat-out lie whose only purpose is to scare the public and stop political conversation."
Same, and even worse, can be said about Sarah Palin claiming that Obama will create some kind of "death panel" to decide who lives and who dies. If we want to talk about the legitimate issues around the public option and reform in general, that is fine. But republicans are not doing that.


steves said...

Not to excuse lying, but I can't think of a single major political issue (crime, health care, tort reform, war, insurance, and gun control) that wasn't bombarded by one side (or both) by some level of lies. The President and his party control two branches of the government. Any inability to pass some kind of health reform would fall on them.

As for the media, they continue to focus on protests, nutjobs and general disatisfaction. They have done very little to educate the public to make informed decisions.

Streak said...

Steve, no argument except I am not sure all lying is the same. Big difference between exaggeration and outright lies. And outright lies are what we see from Sarah Palin and co.

LB said...

"But there is no credible way to look at what has been proposed by the president or any congressional committee and conclude that these will result in a government takeover of the health-care system. That is a flat-out lie whose only purpose is to scare the public and stop political conversation."

This is an interesting statement and perhaps at the core of what the debate over health care is about.

The basic conservative argument is that the public option will not have to make a profit because it can rely on the public treasury. Thus, the public option can undercut prices in a way that private companies cannot. Eventually it will make too much sense for people to not join the government plan. Eventually this will lead to a single-payer system.

The liberal response, as I understand it, is that the public option will be set up in such a way that it must compete evenly with private companies and will be self-supporting based on premiums it collects from its participants.

The liberal response is theoretically correct, but practically wrong for several reasons. First, no government company ever makes a profit. Amtrack should be by rights bankrupt, USPS constantly runs a deficit, and PBS cannot fund itself sufficiently on its pledge drives alone.

The government track record at running companies is one that does not depend on fiscal reality. Instead, the government always allows its companies to survive even if they run a deficit.

The first time the public option has trouble making ends meet, anyone who think that Congress won't bail it out is crazy. Knowing this, the incentive to keep costs low and make a profit is instantly gone. This means that the public option can set just about any minimum price it wants to ensure that everyone is able to afford its insurance, thereby undercutting any chance of long-term even competition for private insurance companies.

Moreover, Medicare and Medicaid pay about 70 cents on the dollar of what hospitals and doctors bill them for. Consequently, those costs, which are not paid, are passed on to those who do pay full price, private insurance companies and middle-class and rich Americans. Who is to say the public option won't act like Medicare and Medicaid and simply choose to pay less than they are billed, thus allowing to public option to keep its costs low, while passing on higher costs to private insurance?

I think I have shown that while the bill may not mandate a government takeover of health, it sets up the conditions for a takeover to happen. Thus, Pearlstein is wrong. There is a credible way to see this bill as leading to a government takeover of health care.

Streak said...

But LB, you just did the same thing you accused Jon Alter of doing. You compared PBS, the USPS and Amtrack to healthcare. Those are not the same things, as you pointed out before.

I understand the argument about the single-payer system and the public option. I really do. And I don't think that is an unreasonable argument. But you cannot tell me that Republicans have addressed this from an intellectually honest perspective. The approach on the public side has been to go out of their way to assure the insurance companies that they will not steal their business.

I am all for reasoned debate, as I have been saying. But the Republicans are not giving us reasoned debate. You are, but they are not. Instead we get Palin's death panels and Gingrich on euthanasia.

Mike Licht said...

First appointment to Death Panel.


LB said...

I have not done the same thing I accused Jon Altar of doing.

Altar made the claim that private companies could compete against the public option just as CNN successfully competed against PBS. I pointed out he had a false analogy because the two are not true competitors.

I have used PBS et. al. to show the government track record of never running a profit in the companies it owns, while still allowing them to survive by pulling from the public treasury. Altar and I have made two different claims using similar examples.

I would also say that Newt Gingrich and Sarah Palin need to just go away. Palin in particular has made a fool of conservatives. That does not mean conservatives have not made reasoned responses to Obamacare. Charles Krauthammer and John Stossel are two leading members of the conservative media who have, I think rejected the sensationalism of Palin and pointed to the very real problems with Obamacare. (BTW, I am using Obamacare as a catch-all for the various bills being proposed, since we all know there is more than one bill under consideration right now). Within the Congress, I haven't heard the Republican leadership like Eric Cantor say anything outrageous.

Having said that, I noticed you wrote:

"I understand the argument about the single-payer system and the public option. I really do. And I don't think that is an unreasonable argument...I am all for reasoned debate, as I have been saying. But the Republicans are not giving us reasoned debate. You are, but they are not."

Based on those statements I am curious what your view of Obamacare itself is. I get the impression you have misgivings but I also get the impression despite the issue of the public option leading to single payer, you are not against the public option. So what is your opinion of the bill Congress has crafted?

Streak said...

I am unaware, actually, when PBS or the postal service every pretended to be self-sufficient. They were subsidized because they provided a service (mail) that was deemed to be valuable enough to the country to provide, or because they presented a viewpoint and material that was not terribly conducive to the market forces.

As for your question, I don't accept your conclusion that the private option will actually lead inevitably to a single payer system. So that is one part of this. I understand the argument, but also fear that without it, there will be no pressure on the Insurance companies to actually cut costs.

Personally, I think this is a horrible place to insert the profit motive. Profit provides a lot of incentive and innovation, but it should not reward recission or limiting treatment to people who need it.

Second, I can live without the public option as long as some other elements survive. I think they have to remove the pre existing condition exclusion--something we have run into numerous times--which keeps us tied to an employee plan. That limits our options in terms of starting a new business, or working with a startup, etc.

They also have to do something about the out of pocket costs. One thing I fear greatly is a catastrophic illness that reveals just how bad our current insurance is. After a point, our insurance (and we are employed and have decent coverage) would simply stop paying and we would be on the hook for that cost. That has to change.

Finally, insurance companies cannot be able to dump people who pay their premiums for the chicken shit reasons they have used in the very recent past and present.

If those things happen, I will be relatively happy. I will be unsure about costs. I deeply resent allowing the same people who have given us this insurance system to dictate how we reform it, but understand the political world we live in.

Hope that answers your question.

Streak said...

Mike Licht--funny stuff. Thanks for posting it.

leighton said...

It's my understanding that the bill is still in progress, so I haven't really dug into its details. But I'm not so sure I would care if most private insurance companies went out of business and we moved to a single-payer (not to be confused with single-provider) system. I think we would still have small, elite private insurers like the one that guarantees comprehensive worldwide coverage for my boss's travels, for instance. But if we're careful, I think single payer could be viable--not that there wouldn't be serious hurdles, as there always are in the wake of large industry changes.

Economics aside, though, I think focusing on the semantics and consequences of the public option (while interesting) misses the point of what Gingrich and Palin are trying to do: scare people about "the government" "taking over" health care. It's not an argument, it's an exercise in button-pushing. And a silly one, I think.

Arguing from human nature, I would prefer to hand my care over to a government bureaucrat who doesn't distinguish between me and a stapler than to a corporate officer who has strong financial incentive to refuse me the care I've already paid for. I can kind of understand antipathy toward the government in the midwest--the policies of Department of Agriculture are explicitly designed to screw over both farmers and consumers for the benefit of agricultural production companies. But the problem, as I see it, is not that there is government regulation, but that the regulations are written by those allegedly being regulated. What we need most of all is less interference by lobbyists monied interests in the legislative and enforcement processes.

I work for an immigration firm, so I deal a lot with government offices. And I spend more wasted time every month on the phone with my boss's pharmacy than I have with all the government offices I have to deal with, combined, in the nearly two years I've worked here. Anecdotes aren't a huge data set, but my gut response to "OMG the government will take over health care" is "So what?" Literally, what is the big deal? What are the bad things that could happen?*

* Though under the rule of "To find out what Republicans are planning, watch what they accuse Democrats of," all this talk of death lists and euthanasia is frankly unnerving.

LB said...

"Anecdotes aren't a huge data set, but my gut response to "OMG the government will take over health care" is "So what?" Literally, what is the big deal? What are the bad things that could happen?"

What are the bad things that could happen if government took over health care:

1. Long-waits/rationing. We of course already ration health care in this country according to ability to pay. Government control of health care means rationing of health care through long-waits as is the case in Canada. Both are wrong. Both are bad options. I'll call this one a push in choosing government take-over or not.

2. Decrease in quality. For government to control health care and keep it affordable it will have to artificially cap prices. This means capping doctors' and other health care provider salaries in addition to capping what government pays to acquire the tools used in health care today like MRIs. Pay caps discourage people from wanting to go into the business or wanting to build a better mousetrap to sell to the government if they don't have an opponent to leverage prices against. Consequently the best and the brightest are less likely to become doctors or be innovative in the health care field. Advantage, private insurance.

3. Abuse of the system. People who have to pay for something are more likely to take ownership in it. If I have to pay to go to the doctor, I'm going to go only if I think its worth the cost. If I don't have to pay anything, I'm going to be more willing to go to the doctor when I probably don't need to go. This is basically what happens already with a lot of people who are on Medicaid. Because they can go for free to the doctor, they go, even if its unnecessary. This clogs up the system for those who really need to see a doctor. Advantage, private insurance.

Those are some very real problems created by a single-payer system.

Granted, there are advantages to the system, namely that the people who really need medical care, can and will get it, eventually.

As I've said before, health care reform is needed. Streak raises some good points about the flaws in the current system. I'm continually frustrated when this country discusses such reform, the answer is always more government. I'd love to see a real debate, one in which actual studies were put forth and argued in a real way that showed the virtues of a single payer system versus the advantages of a truly competitive system like the one I outlined in another post.

Streak said...

First, let me say how cool it is to have a reasoned debate on these issues. That is not what is happening at town halls around the country, thanks to Republicans riling up the elderly with bullshit about the government wanting to make them dead.

Second, I hope Leighton will respond to those points, because I always like to see his mind at work.

Third, i am not convinced about point 2 at all. We have caps on services now--dictated by private insurance. Howard Dean made the point the other day that when he was in private practice he never had someone from Medicare tell him they wouldn't cover some specific test or procedure, but had that experience with private insurance all the time. All the time.

Speaking to that, btw, I am constantly puzzled by the faith that conservative put in that profit motive. Is that the only reason people go into medicine or do research on better treatments? It is only to make more money? I don't believe that to be true, and don't believe either that this reform plan would cut out the profit motive for research and development any more than it has for the latest and greatest in military technology.

4th, I am not sure that the concept of moral hazard applies here. People don't use healthcare the way they buy cars, and I don't think we should build a system around that.

leighton said...


Thanks for your response. From talking to our Canadian clients, it's not clear to me that the issue of waits is nearly so bad as Canadian conservatives and U.S. Republicans claim it is. (At least in cities--rural areas have the same problems as rural areas in the U.S.) From what they tell me, urgent issues are almost always taken care of immediately. That said, I agree that waits for non-urgent things would most likely increase. Not a big deal, in my opinion. My mother had both her knees replaced a few years back, and I don't think there is anyone in my family who wouldn't gladly wait an extra few months if it meant that poor, elderly people could get their knees and hips replaced without bankrupting their families. I think this one is just a question of priorities.

I wonder if the delays may help weed out a lot of the system abuse. Regardless, I'd personally rather accept the delays caused by people unnecessarily seeing doctors than have them forgo necessary visits because of financial hardship.

I don't have a good sense of how (or whether) price caps would be put in place. If they focus on administrative (read: insurance attempts to deny claims) costs and things like meds, that would help. My boss can get six months worth of his meds in Thailand for a third of his U.S. monthly copay (not counting the couple thousand dollars that are applied to his annual maximum payout), so prices are a little ridiculous here even if you assume that we're subsidizing the world's pharmacological development. I think caps on meds would cut down on pharmaceutical research, but way too much "cutting-edge" research isn't designed to solve new problems, but to stuff already overfull niches in ways that are just molecularly distant enough from other products not to infringe on existing patents. (For instance, we have a barely sustainable number of "statin" anti-cholesterol meds in the market already, with more coming down the pipe.) So it's an open question in my mind whether price caps would actually reduce our chemical innovations, or just cut down on redundant research that only helps the officers and shareholders in research companies. Probably a lot of that would have to do with how the caps were implemented; I'm not sure there are general conclusions to be drawn from the existence of caps. Restrictions and guidelines on marketing and lobbying meds to doctors would also help, but I think probably the AMA pushing this as part of their ethical guidelines ("No accepting contributions for prescribing a specific kind of med") would be better than getting the molasses of legislation involved.

My impression from talking to neurobiology students at the UCLA medical school was that the best and the brightest wanted to live comfortably but primarily have the prestige of being research geniuses, and the ones whose bottom line was money went into finance and international business instead of medicine. It's the "respect me for my giant beautiful mind, you peons" rather than the "respect my enormous billfold, you peons" mindset. Again, personal experience makes a tiny data set, but I'm really not sure what the cost in terms of lost innovators would be.

Anyway, it's kind of a big issue, but I think a good starting place is to figure out first off what our priorities are. Partisan bickering for the sake of bickering aside, I think the biggest problem the sensible lawmakers (whose constituency is their voters rather than corporate lobbyists) have is not being able to address openly that some of them care first about people, and are willing to futz around with the budget until it works out; whereas others want the budget to work before anything else, and if people have to keep dying like they have, it's a necessary evil. I'm in the former category, but some people want to be extra double sure that there will still be a country left after we're done saving it. Just the way things are, I guess.

steves said...

Medicare may not, but Medicaid capped certain benefits and would only cover certain psychotropic medications. I know that other insurances do this, but Medicaid was by far the most restrictive. Medicaid paid so little for dental procedures that clients I worked with had to travel 2 counties away to find a dentist that would treat them.

leighton said...

TPM has three brief takes on the proposed health care plan by actual doctors.