Healthcare

Read what Dave Anderson has to say.

Lamborn Platform

Doug Lamborn’s position on healthcare consists of two main points:

  • First repeal, defund or otherwise neutralize the Affordable Health Care Act (“Obamacare”)
  • Replace the above legislation with “affordable, patient-centered reforms”, outlined below.

Mr. Lamborn proposes four goals for a healthcare system, but does not identify specific proposals outside of those promoted by others:

  • Access to coverage by all Americans
  • Coverage truly owned by the patient
  • Improving the health care delivery system
  • Reining in out-of-control costs, tort reform in particular

The issue requires more extensive analysis.

First, the AHC Act cannot be simply dispensed with:

A straight repeal would require a strong majority – veto-proof if the president is a Democrat – and would be a very divisive issue.  Many people find desirable elements in the Affordable Healthcare Act.

Unless repealed in it’s entirety, the influence of the act will endure and the situation cannot be simply returned to the earlier status quo. Work done to-date to prepare for implementation has raised issues that will have to be dealt with.

The very fact that the act has been passed means that government influence on the general health care system is a possibility and must be taken into account, regardless of what happens to the AHC Act.

Second, the U.S. health care delivery system suffers from a number of deficiencies which date from before the AHC Act:

The U.S. has the highest health care cost in percentage of GDP, but ranks behind other nations in the quality of care delivered.

Costs are constantly rising and coverage is being reduced accordingly

The system is a patchwork in terms of rules and administration is a major problem

There is no national consensus as to what the system should achieve.

Had the AHC Act not been passed the system would have continued to deteriorate and the matter of what must be done with it would have come up sooner or later. Because of the AHC Act and budgetary constraints, the government is under the discussion we need now must be substantive rather than ideological.

Statement of Goals

Let us start with the second point, or the key issue of portability.

Currently the bulk of private sector health care is provided by the employer. Losing or changing employment means either losing coverage or switching to a different provider with different costs, conditions and rules. There is no equivalence in health insurance plans across providers or across the nation. A system in which coverage is truly portable would mean that a person moving from a corporate position in California to self-employment in Arkansas could routinely get the same coverage, at the same price, in both situations.

This is not the case under the current system. For it to be possible requires a national frame of reference under which medical conditions and the corresponding care are defined in the same way for all patients, providers and locations. Without such a frame of reference there is no true portability.

Neither is there “access to coverage by all Americans” (Mr. Lamborn’s first requirement). Currently the meaning of “coverage” is determined by location, employment, coverage provider and level of income. A national frame of reference would define what universal coverage (“access to coverage by all Americans”) actually means.

The creation of a national frame of reference for health care is thus the essential pre-condition for the first two requirements: universal access and portability. Setting up such a classification is the first task in the process of setting up a universal coverage system, whether it is private, government-managed, or a hybrid. In the U.S. case, this would be a private-public joint undertaking, since both private insurers and government entities (Medicare, Medicaid) are major providers.

What is referred to above as “a national frame of reference” is essentially a definition of health care. Such a definition leads to a definition of health, which is the end goal of health care. This leads to the two other issues on Mr. Lamborn’s list: delivery and costs.

Since health is the ultimate goal, delivery of health care is equivalent to the achievement of health. This leads to the selection of the means most likely to achieve health, and the requirements for the provision of such means in the most effective way. Once the goal is to make or keep people healthy the issue of costs can be tackled as well.

Current discussions are addressing the problem from the wrong direction; the issue is stated backwards. Because health care costs are skyrocketing, we are arguing about who should pay. Costs are high because people are sick. There will always be sick people, but health is far less costly than sickness, so our goal should be to keep people healthy.

 


Dave Anderson for Congress Platform

Issue

We presently spend 50% more than any other developed nation when it comes to health care. Yet the overall results in key health indicators rank us 40th in the world. We spend a $1 trillion more than we should every year, for what we get. This is absolutely unsustainable and crucially uncompetitive. A comparison of what we spend on, by contrast with what others spend on, can lead to conclusions about what we should do.

Administration Cost – Germans pay less than 5%. We Americans pay 20%.

Intervention vs. Prevention – Most industrial nations pay for results, with prices that are the same for everyone receiving any particular treatment. The American model is to pay fees for service, with higher amounts for use of technology and higher amounts depending on the type of coverage that people have.  Prices vary greatly by type of plan and market or geography.  Physicians do not know what charges will be and patients have no idea either.

Drugs – Prices are negotiated in most countries, whether or not we consider their economies ‘free market’ oriented. In America there are far fewer negotiations; prices to the largest consumer are explicitly not negotiated. Americans pay twice as much on drugs as in other industrial nations.

Participation – Everyone must be covered if societal costs are to be reduced. In America, nearly 50 million people do not have coverage. They are relegated to hospital emergency rooms, where unfunded care provided by hospitals gets passed on to other consumers and health insurance companies – artificially increasing the cost of care. On top of the crucial effect on competitiveness, fully half of bankruptcy filings in the United States are due to medical expenses.

Lifestyle– Emphasis on intervention rather than prevention, with too little ‘consumer skin in the game’ and growth of industrial agriculture with subsidies, are the root of many of our problems. Too much of what we consume can only be considered fuel; it isn’t food and it isn’t healthy. As a result, 75% of all health care dollars are spent on patients with one or more chronic conditions, many of which can be prevented, including diabetes, obesity, heart disease, lung disease, high blood pressure and cancer.  An enormous proportion of what we spend is on a small proportion of our people and very late in life.  We have difficult choices to make, and we are not making them.

Solution

Two quotes capture the situation

“Our healthcare system is an absolutely dysfunctional circle where none of the participants – patients, payers or providers – are linked together in any kind of rational system.”  John Doerr

“We don’t have a healthcare system, we have a disease management system.”  Dr. Andrew Weil

What’s easy to see from an analytical viewpoint isn’t necessarily easy to fix. In healthcare, it’s clear where to look and even what needs to happen. No business that I know of would operate accepting that its largest cost element was twice as expensive (and less effective) than the same component in a competitor’s product. We need to reduce administrative overhead by well more than 50% and move to prevention as the compensation vehicle. We need to move away from fee-for-service intervention. We’ve got to assure that everyone participates; free-riders raise the cost for participants while making the cost for their treatment higher. And we’ve got to create conditions that cause people to take better care of themselves.

If the Taiwanese can hire American consultants to examine best practices and adopt a system that now covers everyone, at less than half of what we pay, it must certainly be possible to do the same here…