Friday, March 12, 2010

Health Reform: An economic engine?

I watched Charlie Rose interview Nancy Pelosi last night, and it was quite a sparring match. A few excerpts: When Rose asked why the legislative version of health reform does not do more to control costs, Speaker Pelosi responded "It's about a different system", and within a few seconds added "Everyone can keep their doctor". When Rose asked about the total cost of the bill, the Speaker responded "CBO just scores the impact on the federal budget.... The bill is about wellness, prevention, and innovation". When asked why passing health care now is so important, Speaker Pelosi said "The health care bill is a job creator and reducer of the federal deficit.... It is a pillar of economic growth." When asked whether or not health care should be deferred so that economic stimulus, climate change, and other legislation could be addressed, she replied "No. They are all connected. We must have leverage over the insurance industry. Health care is a jobs bill". Later: "The health reform bill is about history, progress, innovation, entrepreneurial discipline, families, and jobs."

I thought this exchange was interesting because, at least in the eyes of the Speaker, health reform is not really about health care but about controlling the costs of the health sector in order to spur economic growth. If so, the bill's new health care taxes and inability to stem the tide of rising medical costs will be big disappointments.


  1. Bruce,

    Just subscribed to your blog. So I'll jump in with some thoughts.

    First, I strongly believe that the 'problem' of our health care system is not due to doctor, insurers or pharmaceutical companies, but rather to the 'for profit' nature of healthcare in general.

    We can analyze all of this (figuratively) all of the opinions, 'thots', studies, etc. and with all the finger-pointing, to fix this will come down to several basic tenants.

    1. It will take at least 15 or more years to unravel what has taken 40+ years to entrench. Between all the interrelationships, contracts, employee levels, public shareholder ownership and methods of insuring (risk-pooling), only a dishonest or disillusioned individual like our politicians would even think to imagine that we could create any real type of traction in solving this within just a few years.

    2. It will take sacrifice in profits and salary. Not just the CEOs, but those in management, sales, customer service, etc. Everyone will need to share in the sacrifice financially, if we are to bring down costs across the board. Do people want to do this readily or even with legal mandate? Not likely.

    3. Increase taxes. Government chooses to run a sizable portion of our healthcare, its going to need more money.

    Bob, not saying that this can't be done, but I wish that someone would just step up and tell it like it is. Unraveling a for profit system that involves trillions of dollars, shareholders and massive levels of employment cannot be done through manipulation of emotions.


  2. Steve-O - I couldn't have said it any better.

    I work for a health insurance company, and I fear that whatever comes out of it will have repercussions for decades to come. If our politicians think that private health insurance will shrivel to obsolesence once "single payor" comes on line, that thinking is completely delusional.

    Private insurance will still exist; it will just be very difficult to compete against an artificially cheap "single payor" plan. Within a few years after implementation, however, if there is dissatisfaction far and wide with single-payor, private insurance will become attractive again, and perhaps implement real cost-saving strategies that single-payor could never touch.

    I also tune out the propaganda from both sides of the aisle. It's pure noise and does nothing but obscure coherent and clear critical thinking about what is going to happen in the next several years. I can tell you that within the next year, the Democrats will lose both the Senate and the House because the Democrats are not listening to their constituents and are being arrogant in the process. Furthermore, I don't think we'll ever see a female Speaker of the House for many decades to come.

  3. In countries with single payers, private insurance often emerges to handle the services that are not covered by the national system, or elective services that are habitually subject to delays. In essence, this is a form of rationing by income levels. See here for an example from Iceland: And here's one from the UK:

    In the US, we ration by income level, too. But here, we make it hard for uninsured people to get access to primary care. They then become dependent on hospital emergency rooms for care that would be more appropriately dealt with in a doctor's office.

  4. Bruce, I hope your blog's approval rating will surpass Pelosi's. Best of luck.

  5. How much of the "reform" do the Democrats need to pass in order for them to consider it a successful bill?

  6. All: Unwinding our market-based system would require that we look not just at for-profit insurance companies but at physicians and all the ancillary businesses that depend on the doctor's order (e.g. drug manufacturers, durable medical equipment suppliers, hospitals, etc.). I don't see any appetite in D.C. for this.

  7. Blogs are so informative where we get lots of information on any topic. Nice job keep it up!!

    Politics Dissertation

  8. fantazi gecesi. kaliteli seks. Fantazi alemi ürünleri. seks shop da indirim. sexshop indirim sitesi. sex shop indirimli ürünler hakkında. erotik shop sağlıklı seks yap. erotik market fantazi gecesi.