Thursday, August 13, 2009

Why Obama is losing the health care debate

Before continuing my posts on a public option for health coverage, I wanted to stop and comment on the concept of universal coverage. In response to my last post, an anonymous poster says that universal coverage contributes to higher life expectancies in other countries. My response to that is that (please take note)it might, although we should keep a few things in mind. First, most developed countries other than the US claim to have universal coverage. But that doesn't mean that everyone gets the same health care (they don't) and it doesn't mean that, in the US, there are people who get no health care (there aren't). In addition, for most of these countries, life expectancy clusters between 77 and 80. The difference between them could be attributed to health care, but it could be wholly unrelated.

We do know that when we look at things that the health care unambiguously delivers, i.e., timely care, good survival rates and medical innovations, the US system is unrivaled - and much of the innovation that leads to these things is then adopted by other countries which do not themselves produce them.

My conclusion - and I think it is a reasonable one - is that our current system does many things well for the overwhelming majority of people. So, to borrow from what has become an accepted part of the Hippocratic oath (although some say it was not there originally) - "first, do no harm." The reason that the President is losing the health care debate (indeed, may have already irrevocably lost it) is that his ambition largely dismisses that advice.

If there were nothing to lose, then the proposed centralization of "best practices, "pay for a (uniform concept of)performance," federally standardized coverages, and a public option that may undercut private alternatives and dampen incentives for innovation even as it results in greater equality wouldn't bother people.

But there is something to lose. The awful and immoral health care system that is portrayed by our friends on the left is not the health care system as experienced by somewhere between 75 and 90% of Americans. If you don't begin your thinking by acknowledging that, you aren't going to get anywhere.

And Obama hasn't. The problem is not that "special interests" (a much abused term) are unfairly frightening people. It's that people have reason to be frightened. Like Mrs. Clinton before him, Obama is making the perfect the enemy of the good.

This isn't to say that universal coverage isn't a laudable goal (we should seek it) or that there is no room for improvement. But folks are understandably reluctant to throw the baby out with the bath water. The President has consistently failed to take that concern seriously. He knows it is a problem. This is why he began by claiming that no one would be forced out of their current coverage before he had to acknowledge that he only meant that the government wouldn't mandate such an outcome, although it might very well occur. His speculation about "red pills" and "blue pills" and pain killers instead of treatment for those who are too old or too sick plays into what everyone knows are the weaknesses of public health plans.

Fairly or not, folks on the left blame the "Harry and Louise" ads for killing HillaryCare. However you view those ads, it may not have taken even that to kill ObamaCare. Somehow this guy doesn't seem so formidable. It turns out that he's not "like God" after all.


Jack Lohman said...

There is only one reason why Obama is losing on health care: the $46 million in bribes given by the insurance industry that bought political non-action.

Yes, if you leave the insurance industry in the loop to skim off 31% of our costs, this IS going to be a very expensive bill. Single-payer is the only deficit-neutral solution.

Jack Lohman

Anonymous said...

Obama is losing the health care debate because of 1) people like Palin and Grassley and their talk about death panels and 2) there are a lot of uneducated people in this country that get all their news from Faux News.

Anonymous said...

I object to your assumption. We are having a debate about universal health care. Universal health care has been a goal of the Democratic Party since President Truman. No Democratic President has accomplished it, however, and during Republican administrations it has not been a policy goal or a front-burner topic of debate. Now even folks like you, in reaction to the agenda the President is pushing, are forced to debate alternative ways of achieving universal health care.

Many people have reliance interests in the status quo, and change is scary. Fears are legitimate and need to be addressed. Questions need to be answered. But this President has put universal health care on the top of the national agenda, and some form of it will be adopted. That we are having this debate is a win for Obama. When we adopt universal health care, it will be a win for him.

Anonymous said...

The universal and national socialist coupled with very large corporations will eventually prevail in this power struggle over the people.

It appears to me the only thing hindering them right now is not knowing how many people distrust big government and will protest. However, they will continue to move forward until they know.

If the current system would have refrained itself from abuse, we probably would not be discussing this at all.

Anonymous said...

Good insightful post. I don't think the administration has lost yet. There are plenty of true believers on the left who refuse to see the reality that a government run bureaucracy, lacking the profit motive, will never and cannot be more efficient than the current, flawed system. The Dems still control both houses of Congress and the Administration will try to strongarm, or buyoff with further pork, party members. Will housemembers (Kagan?) be so afraid of losing reelection that they oppose President Obama? I'm not optimistic. Unfortunately, once this scheme is in place, it will be hard to dislodge even if the Republicans retake both chambers of Congress.

Jack Lohman said...

So let me see. I’m on Medicare and have the option to sign onto the privately run Medicare Advantage system, which 19% of Medicare recipients have done. But that costs taxpayers 17% more than traditional Medicare. How has the lack of a profit motive kept traditional Medicare from being 17% less costly?

So much for private being more efficient than public.

With Medicare, doctors and hospitals remain private and are “contractors.” The only thing that changes is the logo on the check that pays my bill.

With private insurance the company is run by a CEO whose salary is determined on how much care he can deny, even though that's what premiums pay for. You apparently have not heard of the 17 year old girl in California that died because she was denied a kidney transplant. That was the for-profit Cigna, not Medicare. And the cost of the transplant would have reduced profits (and salaries).

I'll take Medicare any day.

Anonymous said...

Mr. Lohman,

You intentionally miss the point. I also don't think your example is real. I would concede there is a lot of inefficiency in the current system. But much of it is caused by the fact that the person paying for the medical treatment is not the person who is receiving it. If I were hiring someone to build me a house and were not paying for it, I would not expect that the outcome would be the most cost effective. I think we would all agree it would tend to be more expensive.

I also disagree with your ad hominem attack on "insurance company CEO's." There are good CEOs and bad ones. But if they want their companies to survive in the long term, they have an incentive to make their company one that employers and individuals want to purchase insurance from. That would seem to be obvious. There is certainly an incentive to keep costs down and that means having employees who adjust claims deny claims that they think are outside coverage. Do they make mistakes? Of course. They are human. Sometimes those mistakes are tragic. It is worth noting that under current law a mistaken claims decision exposes the insurance company to bad faith lawsuits and significantly greater damages. Do you really think that by taking that individual human claims adjuster and making her a goverment employee is going to make her less likely to make a mistake? Do you think it will make her more efficient? Have you ever dealt with the DMV or other government bureaucracy? The current proposal would make any existing bureaucracy seem tiny. That should be concerning.

As for the girl with the denied kidney transplant, I am not familiar with the case, but it sounds tragic. It would be just as tragic if some government employee denied the claim.

Anonymous said...

Where's the connection to gay marriage?

Jack Lohman said...

Well, Anonymous, you sound like an insurance executive, but if not, certainly a defender. For the record I spent 40 years in healthcare, the last 25 as a CEO for a cardiac monitoring company. And I spent 20 years billing Medicare and the last 5 as a Medicare patient.

However, my salary was nowhere near those of the insurance industry, and I would argue their "long term" concerns. They are paid on a short term basis and short-term success is more important to the CEO, though the shareholders certainly want long-term success. But that said, there are indeed some very good CEOs out there who would put patient care over their salary.

But even still, the insurance bureaucracy (which includes the extra hospital and clinic billing clerks to handle the myriad of companies, 1500 in this state alone) is draining 31% of healthcare dollars. 20% of our total could be eliminated with a Medicare-for-all system.

And yes, government claims adjusters are likely not to be rewarded for denials as are the private adjusters. They probably will error in the opposite direction which will cost dollars rather than lives.

And though Medicare is not perfect and could stand significant reform itself, the medical side is private doctors and private hospitals. And the payment contractor (WPS in Wisconsin) is also private. The only "public" employees are the yokels in DC.

Seth said...

Rick earlier this week:

[The] Wyden/ far more promising than HR 3200.

Obama on the Wyden/Bennett bill:

That fundamental shift, along with the major changes in the tax code that Wyden proposes, are too "radical," Obama said, when aligned with all the other changes that must take place to provide health insurance to 47 million Americans who don't have it.

The president said his discussions with Wyden are similar to those with people who advocate a single-payer system. In theory, those plans work, he said. "The problem is, we have evolved partly by accident into an employer-based system."

A "radical restructuring" would meet "significant political resistance," Obama said, and "families who are currently relatively satisfied with their insurance but are worried about rising costs ... would get real nervous about a wholesale change."

Rick today:

My conclusion - and I think it is a reasonable one - is that our current system does many things well for the overwhelming majority of people. ... The reason that the President is losing the health care debate (indeed, may have already irrevocably lost it) is that his ambition largely dismisses that advice.

LOL! Good stuff, Rick.

Jack Lohman said...

What I find particularly amazing is that this very wealthy insurance industry has managed to rally thousands of people to publicly protest against reforms that would be in their own best interest. Reforms that would remove profits from the industry and instead filter them back to the protester's employers or their own pockets. Now there is an effective public relations scam.

illusory tenant said...

Good catch, Seth.

And Jack, Gwen Moore was booed when she suggested a tax increase for families with annual incomes exceeding $350k.

Every millionaire in her district must have turned up for that town hall meeting.

Jack Lohman said...

Well, I'd probably get booed too. Poor people are not going to pull us out of this mess, only those with money will. So, what is in the best interest of the nation? No money from the poor or some money from the wealthy?

And for those who object I'd suggest that they learn how to watch the dominoes fall. It isn't going to be pretty.

Anonymous said...

Mr. Lohman,

I am not an insurance company CEO. I just don't think it advances the ball of rational debate to disparage blindly an entire group of people. As you acknowledge, there a many CEOs who do think in their companies' and shareholders' long term interests.

In the end, we disagree mainly about whether replacing the insurance bureaucracy with a government bureaucracy will save money. I would wager everything I own (which may not be much compared to a former cardiac monitoring CEO) that the goverment bureaucracy will not be 20% cheaper. But then again, if this passes, you are not betting just your own money, you are betting mine too.

thanks for the debate. Now back to work.

Anonymous said...

We allow our government to set the price that farmers get paid for milk but we do not allow the government to set the prices for health care.

Let's be consistent.

Jack Lohman said...

Anonymous, I said "executive," not CEO, but I'll assume you aren't in the industry. I can't tell you how many times I've had to defend against their attacks.

But if you really want to learn about this industry read the congressional testimony of Wendell Potter, the ex-insurance executive, or this interview:

And no, I'm not just betting your assets, I'm also betting my kid's and grandkid's. At 72 I don't think I'll have to worry about my own for too many years.

Dad29 said...

And yes, government claims adjusters are likely not to be rewarded for denials as are the private adjusters. They probably will error in the opposite direction which will cost dollars rather than lives.

Sure, Jack--just like in the Heavenly Land of Medicare, where costs are NOT recouped by providers except by stealing from privately-insured plans.

Haven't you read the Obamamamama promise of "less expense"? Where in Hell do you think that "less" is going to come from?

It will come from DENIALS or from shorting MDs, RXs, and hospitals.

And btw, Anony is right: your one-note "greedy insurance companies" stuff is not only damaging to your credibility, but tiresome, too.

Jack Lohman said...

Dad, you are truly misinformed on Medicare. Medicare rates are fair, they are just not exorbitant. If costs were not fair and my doctor was losing money on me, he wouldn't be nagging me to come in for my yearly physical.

Hopefully that "less" is going to come from the elimination of over-ordering, which also wouldn't occur if they were losing money on the system. You can't make up losses by increasing volume. But our fee-for-service system (and the profits on Medicare patients) perversely affects unnecessary ordering.

Medicare does not have near the denials that private, for-profit insurers have, because it is those denials that increase profits and executive salaries.

On "greedy insurance companies," have you not followed the congressional hearings where the insurance CEOs were asked directly if they would cease the practice of "rescission," where they cancel policies on expensive patients RETROACTIVELY, in one recent case three days before a mastectomy? And they've done this in about 20,000 cases in the last year, and incidentally, they said NO they will not stop.

Have you not followed the congressional testimony of Wendell Potter, and ex-insurance executive from Cigna that could not take the private system any more, resigned a very high-paying position, and became a whistle-blower?

Have you not followed the case of the 17 year old girl in California that was denied a kidney transplant and DIED? That was Cigna, NOT Medicare!

Get your head out of the sand. These insurance guys have a fiduciary and legal responsibility to increase profits, and the best way they can do it is by denying care to people who have been paying into their system. . It certainly won’t be by cutting CEO and executive salaries, or shareholder profits or broker commissions, or even their lobbying and campaign contributions that they pass on to the patient.

Isn't capitalism great?

Dad29 said...

OK, Jack, it's all greed. Whatever.

Jack Lohman said...

Yea, Dad, but when it doesn't affect you it is easier to take, isn't it?

Anonymous said...

No dad, it's all about poor people. Like they teach in church, remember?

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