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Single Payer Pivot
Health Care Confusion Reigns at the NYT

The single payer pivot is going gangbusters over at the New York Times. The Grey Lady had two pieces out yesterday on health care prices, and the mix of the two shows a paper, and an intelligentsia, deeply confused about health care. In the first piece, “The Cost of Health Care is Seen as Decreasing,” Annie Lowrey reports that despite its troubled launch, the Affordable Care Act is getting at least one thing right: it is costing US taxpayers much less than initially expected.

But, as Lowrey goes on to relate, the savings have very little to do with the Affordable Care Act itself. The ACA is merely a passive beneficiary of trends that are effecting health care spending across the board:

Administration officials have pointed to falling hospital readmission rates as one strong sign that cost-control provisions in the Affordable Care Act are working. Also, they noted that a growing number of insurers and health care providers are agreeing to contracts that pay for the quality of care, rather than the quantity, another indication that the law’s encouragement on that front is starting to pay dividends.

But those are responsible for only a tiny portion of the slowing rise of health care costs; other changes, like rising deductibles and copays that discourage some people from seeking extra services, play a bigger role, analysts say. Still, the Kaiser Family Foundation, a nonprofit research group, estimates that the weak economy accounts for as much as three-quarters of the slowdown in the growth of spending on health care.

The piece was clearly an attempt to put a positive face on an embattled law, but it does so in a bizarre way, by referencing a health care spending slowdown that all experts agree the ACA did not really cause.

But as convoluted as that first piece was, reading it alongside the special feature the Times ran on “soaring” hospital prices is enough to give anyone whiplash. “As Hospital Prices Soar, a Single Stitch Tops $500,” by Elizabeth Rosenthal, argues that for many consumers, health care is getting more expensive, as out-of-control medical inflation and price opacity continue to savage our medical system. The piece contains mostly old news, rehashing many of the (very valid and important) points elaborated on by Stephen Brill in his groundbreaking Time Magazine piece. But the Rosenthal piece is important for the role it’s playing in the delicate two-step single payer pivot that we’ll increasingly see from the left. You can see what’s really going on here with this one line:

The main reason for high hospital costs in the United States, economists say, is fiscal, not medical: Hospitals are the most powerful players in a health care system that has little or no price regulation in the private market.

That sentence is the fulcrum point of the single payer pivot. Step one is to argue that the ACA was a success on some access or cost metrics—in the Lowrey piece, that its helping to bring down prices. Step two is to argue that despite its success, the ACA didn’t manage universal coverage or systematic cost controls (because it didn’t attempt it), and therefore we need an ACA 2.0 to build on and expand the successes of ACA 1.0. And, lo and behold, ACA 2.0 looks very similar to a single-payer system.

But this narrative is fundamentally confused. As Lowrey herself admits, the ACA wasn’t the driving cause behind cost reductions, and whether the law will be a success on other metrics still very much remains to be seen. Given ongoing stories of network restrictions, we’re skeptical. But the even more fatal error is the belief that health care in America is expensive simply because we don’t have cost controls and if we could just pass federally mandated rate setting, soaring prices could be kept down. A key fact that argument misses is that even in those countries that had price controls, the cost of care is still going up every year.

A certain kind of health care wonk sees out-of-control prices and wants to regulate the already heavily-regulated health care sector even more. But the answer to our health care crisis is not more and more federal tinkering in the system; it’s opening up the system to consumer pressure and price transparency, while at the same time innovating new cost-saving ways of delivering care to patients. If we do those two things, any subsequent reform—say, expanding access even more—will get easier. But if we fail on those, the complexity of our system, the structural defects bankrupting us, and the aging of the boomers will limit the successes any top-down reform could achieve.

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  • crocodilechuck

    Hey, Walt

    America has socialised fire protection. America has socialised law enforcement. America has socialised national defence (your contractors, e.g. Lockheed, are wards of the state).

    But the first time anyone mentions socialised health care, aka ‘single payer’, you go apoplectic.


    • Boritz

      Speaking for myself (not Walt)

      The firefighters in my area are city and county, not national.

      I have not personally ever used their services.

      I don’t perceive them to have major control over my life on an ongoing basis. Maybe I’m wrong. Maybe the local fire dept. has me right where
      they want me, but it doesn’t seem like it.

      My relationship with them is not governed by a 2000 page
      document written at the national level.
      If I need their services, I expect they will perform their duties according
      to their training without regard for such considerations as “the secretary
      shall determine…”

      The military, except in extreme circumstances, is not
      directed at me but foreign entities (I like to believe).

      Law enforcement – A mixed bag since they include local, state, and national.

    • qet

      Would you feel better if he went apoplectic over socialized steel production? Socialized agriculture? Perhaps you can explain why health care is more like national defense and less like agriculture. If your point is merely that everyone has his hand out for government money therefore no one is entitled to object to anything the government might do, well, then the right solution is to start shutting off the government taps. Which we did, briefly, and in a de minimis amount, a couple of months back, and our national Op-Ed Guild collectively went apoplectic.

      • Andrew Allison

        Healthcare is more like national defense than agriculture because everybody needs healthcare but is not getting it, but there’s no shortage of food.

    • crabtown

      Have you ever been a part of a volunteer fire department?

      I seem to remember a document written over 100 years ago that said something about “providing for the common defense.”

    • AD_Rtr_OS

      Not ALL aspects of those three items you mention are socialized, and only the last is mentioned as a requirement of the Federal Government in the Constitution.

    • Andrew Allison

      A good argument weakened by not recognizing what are, and are not, accepted in the US as national governmental responsibilities. National defense, justice, and welfare (largely) are socialized. The debate about healthcare would be greatly simplified if there were a consensus on whether healthcare is the sort of universal need that should be socialized.

    • Jim__L

      You should read VM more often… there are any number of articles talking about public employee unions (including firemen and police), and the sorts of problems the Blue model is having paying for those socialized services. It’s not apoplexy there, but it’s not apoplexy here either — I’m not sure I’ve ever seen apoplexy on VM north of the “Join the Discussion…” box.

      That said, VM has a good polemic now and then, but less of those nowadays than before. I think he’s trying to set a good example for us. I miss the polemics… 😉

  • Andrew Allison
  • qet

    Here is where Via Meadia’s congenital cynicism deficit and/or politeness edema prevents it from seeing the Real for what it is. Not one of these writers–not one writer for NYT, WaPo, Slate, Salon, HuffPo, not one writer for any “think tank”–attempts to decide on single-payer health care or on health care policy generally (or specifically) by sitting down and collecting reliable data and then applying neutral statistical operators in a totally disinterested manner qua Baconian scientist. No, these people already “know” that single payer is morally required, but they also know that in the USA the Marquess of Queensbury rules for engaging in paid public dialogue on such matters requires that they present their moral sentiments as numerical results, so they select from the vast miasma of “data” floating around those points that suit their present purposes and urge now one, now the completely opposite “fact” in support of their beliefs. It is simply mind boggling that so many people here continue to pretend that they are engaging in “evidence-based” debate or policy when they really are only decorating their convictions with numbers. It is the modern case of credo quia absurdum.

    • Andrew Allison

      A fellow Bastiat (who should be required reading for VM staffers) fan, I see. I agree completely. Where we part company is that it’s my belief that if, and only if, we decide that all legal residents should have access to healthcare, the only way to pay for it is to have the risk pool include all legal residents.

      • PapayaSF

        Nearly everyone in the country “has access to” food, clothing, and shelter without having everyone in the same “risk pool.” The answer to our healthcare problems is competition and innovation leading to cheaper services, not more insurance.

      • f1b0nacc1

        You are confusing healthcare with insurance…increase access to the latter too much (which is what this administration is hell-bent on doing), and you will decrease access to the former

        • Andrew Allison

          On the contrary, I’m trying (with conspicuous lack of success) to keep the focus on healthcare. Specifically, let’s decide who should have access to what, then try to figure out how to pay for it.

          • f1b0nacc1

            Why not let them decide for themselves? Make the pricing transparent, and stop distorting the marketplace with silliness like guaranteed access to insurance (which is more often than not insurance, but merely pre-payment)…
            When you get around the statistical flummery, there is little evidence that the socialized systems generate better (overall) results, and less still that they generate better (individual) results. How about trying choice?

          • Andrew Allison

            Decide what for themselves? The misbegotten ACA disaster was conceived as a means to bring affordable healthcare to the roughly 10% of the population who lack insurance, and hence access. This, I strongly suspect, goes far to explain why the country with world’s most costly healthcare is roughly 30th in infant mortality and longevity (let’s not get into whether it’s 25th or 35th — given that we spend twice as much per capita as any other nation, we should be number one).

            The fact is that that single payer systems demonstrably deliver better overall performance because they deliver it to ALL legal residents. There’s no question that if you have insurance you can get healthcare as good as any in the US. The problem is that if you don’t have insurance, you’re screwed.

            For the umpteenth time, the question is: should we provide healthcare for all and if so, how do we pay for it.

          • f1b0nacc1

            First, let me say it one more time: access to insurance and access to healthcare are NOT the same thing, no matter how often you try to conflate them. ACA was intended to produce the former, it will fail, but it may succeed in destroying the latter as well…
            As for outcomes, infant mortality (where different countries measure it differently) is a terrible measurement, and longevity (where the demographic and ethnic makeup of the countries differ) is almost as bad. Measure middle class 40-year old white male longevity in the US, France, the UK, and Germany, for instance, and you get fairly consistent results. France, where extraordinary measures to sustain the life of ‘difficult’ childbirth cases is forbidden (i.e. the state won’t pay for it) has far lower infant mortality than the US, where such measures are commonplace.
            As for providing healthcare to all…no, we shouldn’t, and yes we should. We should ensure some minimal level of care, but that is not open access to all no matter what. That way lies bankruptcy and ruin, no matter how much we might wish it to be otherwise. Insurance is designed to MITIGATE the costs, not eliminate them…healthcare (the product of someone’s labor) still costs money, and if you don’t intend to indenture doctors and seize pharam assets, it always will.

          • Andrew Allison

            This discussion is pointless. You continue to posit and attack straw men. I have never, for example, attempted to healthcare and insurance are the same thing. ACA was designed to provide insurance, not healthcare, etc. The list goes on, but I’m done.

  • Kavanna

    All this demonstrates is that the Times isn’t really a newspaper any more. It’s a bland propaganda broadsheet for urban gentry liberals.

    ACA has to be shown as failing, so we can get to Single Payer. ACA has to be shown as succeeding, to make Obama look good. ACA has to be shown as necessary, in order to control exploding costs. ACA has to be shown as successful at moderating once-exploding costs. And so on. Any reporting that happens here is purely incidental and coincidental.

    BTW, the latest religion of American liberals, Single Payer, is slowly being scrapped in Canada, its home, which now effectively has a mixed system — which is what our system is already.

    • Andrew Allison

      I was with you until the last sentence. I think that the home of single-payer is the UK, which has had single-payer for 65 years and like every other single payer system in a free-market society, is mixed. It’s not either or. As the ACA is about to demonstrate, if you want to provide universal coverage, everybody must be in the (risk) pool. This says nothing about the ability of those who can afford it to obtain more comprehensive coverage.

  • AD_Rtr_OS

    Market Price Competition?
    How about requiring all health-care providers – hospitals, clinics, offices – to post (or at least have available) their price schedules so that medical consumers can price-shop before-the-fact?

    • Andrew Allison

      I agree in principle, but comparison shopping in the ambulance on the way to the ER presents certain difficulties.* Wouldn’t it make more sense to have a standard price list (adjusted, say, for regional COL), with the option to buy insurance for Cadillac care (from the same facility) if you so choose?
      *a problem which those who suggest opting out of ACA until it’s needed overlook.

      • Jim__L

        Emergencies aren’t the only time you’re in the market for health care. Although I would agree that to make comparison shopping work, you would need to allow people to adjust their insurance choices whenever they decided their current services were not worth the price they were paying, and not just during an “enrollment period”.

        That flexibility would cause further problem with the ObamaCare approach… which is yet another reason to REPEAL it.

    • ToniTexas

      I wish. But it’s impossible, because different insurers negotiate different rates, and Medicare dictates theirs. Maybe Medicaid, too.

  • lhfry

    Single payer is not clearly defined. Some think it’s like Medicare, a single payer system that retains the fee for service model. Others think it’s a national health service, like the Brits, where doctors are on salary paid by the taxpayer. The latter can be less costly in terms of dollars, but no Brit who can afford private insurance relies on the NHS.

  • free_agent

    It would be interesting to see a table of the two dozen or so advanced countries, giving for each some important statistics (life expectancy, percent of GDP spent on health care, etc.) and a narrative classification of how the overall system works.

    In the few cases other than the US that I know of, the government operates a monopsony, either setting prices via a single-payer system, or sponsoring a price-fixing negotiation whose cost is fixed a priori. As VM says, this doesn’t seem to freeze health care costs as a fraction of GDP, but it does seem to cut costs by at least 1/3 and reduce the growth rate substantially.

    My suspicion is that part of this effect is due to the government is operating a monopoly as well: The government gets to say what sort of health care you can get. In some instances, this entails restricting care from a medical point of view. But in others, there is a lot of anecdotal evidence that the amenity level of non-US health care is a lot less than in the US. As one hospital said, they were building new hotel-like facilities because “We’re trying to compete for an increasingly shrinking pool of patients with good insurance.” Like colleges, costs at top-end institutions are unlimited because affluent customers demand high levels of amenity.

    In my city (Boston), it’s no secret that the two most prestigious hospitals formed a combine to prevent insurance companies from forcing them to price-compete with each other. It’s no secret to anyone that they’re the most expensive hospitals in the region, either, but if you’ve got “good insurance”, the money isn’t coming out of your pocket. It’s also no secret that Partners Healthcare is driving up the prices for medical specialists throughout the local economy…

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