Obama concedes his is a health-care rationing plan.
(Page 2 of 3)
The CEA here also displays more faith in the omniscience of government, which is supposed to develop the prices for all health-care services that will perfectly reward high quality care that works rather than low quality care that doesn’t, providing the perfect incentives that will perfectly wring out 30% of total health costs as unnecessary waste. The only problem is that a remote, centralized, government bureaucracy in Washington doesn’t, can’t, and won’t know, out of all the health-care services in the economy, what works and what doesn’t, what are the right prices for each that will provide exactly the right incentives to eliminate precisely only the 30% of health-care spending that is waste, and what exactly is waste, rather than the health-care services you want. And this is before politics gets involved, and the bureaucrats answer the phone calls from Congressmen who want an explanation as to the pitiful payments the government is providing to such and such doctors and hospitals in their districts.
Nevertheless, despite the government’s severe lack of knowledge as to what it is doing, those doctors and hospitals that do not follow the government’s decisions as to what is quality care will get formally labeled as “lower quality,” losing out to the good doobies who win high quality provider labels by slavishly following the health-care diktats of the remote government bureaucrats who don’t even know their patients. This is found in another CEA cost control measure:
Expanding performance measurement and provider feedbacks. Performance measurements include collecting and summarizing information about clinical quality, consumer satisfaction, and resource use of provider practices….One potential way to increase efficiency is to facilitate the development of a set of performance measures that all providers would adopt and report….Additionally, new efforts could be made to generate risk-adjusted provider performance profiles to encourage quality improvement and to inform consumer decision-making around quality.” [Emphasis added.]
The omniscient, central, government, health-care bureaucracy, of course, will know exactly how to measure the performance of every doctor and every hospital in the country for every health-care service. And there won’t be any politics in this either.
America’s New Waiting Lines
But the CEA has still more bright cost control ideas:
Rewarding high-value technology creation that reduces morbidity, mortality, and total spending over the lifetime. In most fields, technological progress is generally cost-reducing as individuals discover more effective ways of accomplishing things that were already being done. In medicine, however, technological progress in recent decades has been almost exclusively cost-increasing, without generating a commensurate increase in value. Undoubtedly, provider incentives, which largely reward finding an expensive way of treating a previously untreated condition rather than finding a less costly alternative to an existing treatment, contribute to this trend.
This is meant to address a problem earlier identified in the paper:
Providers also have strong financial incentives to compete on the basis of technology adoption rather than price, leading to an excess supply of high technology equipment and services (for example, MRI machines and minimally invasive vascular diagnostic and procedure suites) and accelerated replacement of hospital beds in local markets. In turn, this can lead to higher rates of utilization and costs.
But is the government going to know exactly which technological innovation will reduce morbidity, mortality, and overall spending, and which will simply involve “an excess supply of high technology equipment and services”? Is the government going to know exactly how much to reward technological innovators to provide the incentives to gain exactly the right technological innovation, but none of the wrong, excess technology? Or is the government going to use this power to delay implementation of new technological innovations, discourage investment in new technology development, leave patients floundering with long waiting times for the latest high tech diagnostics and treatment, and thereby reduce costs, as in all those foreign countries the CEA admires in its report? What do you think?
Obama OMB Director Peter Orszag was more clear and direct in explaining the policy recently, saying, “Future increases in spending could be moderated if costly new medical services were adopted more selectively in the future than they have been in the past, and if the diffusion of existing costly services was slowed.” Told ya’.
Can you see yet how the Obama socialized medicine plan will involve the government taking over and running health care in great detail? Can you see how under that plan, remote government bureaucrats in Washington will be deciding what health care you get and when, rather than you and your doctor? Can you see how the Obama socialized medicine plan involves pervasive and detailed central economic planning, which all experience teaches us will not work? Can you see now how these Obama cost controls involve government rationing of your health care, just like in every other country that has adopted socialized medicine?
CEA’s Blind Spots
While Obama’s CEA explains exactly how the Obama health reforms will impose severe government health-care rationing to reduce costs, it is totally blind as to how those reforms will increase costs, and bankrupt the nation. Obama’s socialized medicine plan will increase health costs by increasing demand, not primarily through increased demand from the currently uninsured, but because of the incentives for all patients under the new system. With the government paying the bill, the incentive is to consume health care until the net benefit from it is equal to zero, rather than equal to costs as in an efficient market.
Even worse are the incentives for health-care providers, which greatly reinforce the rationing. Obama’s socialized medicine plan will increase health costs by reducing supply. The government already has a long history of failing to pay adequately for health services under Medicaid, and increasingly for Medicare. With a complete government takeover of health care, these payment policies will soon cover the entire health-care system. That and the loss of freedom of choice and control over their own practices and services due to vastly increased government control will cause doctors and other health professionals to leave the industry, and talented young people to choose other professions.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?
H/T to National Review Online