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Originally posted by Tyrone_Slothrop
The whole health-care system is like a massive catalog of the different sorts of market failure. And then the government's involvement distorts the market (and others -- e.g., through the tax benefits for employers to provide health insurance).
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One of the biggest problems with our health care system is that we do not pay as much attention to preventive medicine as we should. A study came out last week that suggested that bypass surgeries and stents are relatively ineffective in preventing further heart problems, though our system insists on treating the acute problems instead of focusing on the larger issue of public health. Diet, exercise and lifestyle changes much earlier in a person's life are much more effective.
The managed care models proposed in the 60s and 70s contemplated that an individual would be in a managed care plan for decades, and that the plan would have incentives to prevent expensive-to-treat health care problems before they manifested through educational programs, screening, and simple, inexpensive preventive care. Of course, the model got muddled, and the HMOs that came out of the model were inefficient and more importantly, easier to leave.
We look at health care very acutely in this country, and we focus more on treating disease as it presents itself instead of doing what we can to prevent it in the first place. We focus much more on the individual than on the community as a whole, which is much more expensive to deal with.
Additionally, we’re a population that insists on getting the state of the art everything. Insurance masks the real costs, and the consumers are blissfully unaware of how much they’re costing. My personal health care costs annually are minimal, since I have no dependants and my employer covers all of my health insurance. I pay for a few over the counter drugs, maybe a $25 co-pay once a year or so, my gym memberships, and a few prescription drugs. I glance at my pay stub every few months and estimate that my employer pays probably two or three thousand dollars a year for my coverage, but it doesn’t really impact me very much. Being a public health advocate, I don’t take advantage of the system, and I don’t pursue what I think are unnecessary services that might nonetheless be paid for under my plan. Not everyone is like me. My grandmother, for example, LOVES to go to her physician for every minor ache and pain. She’ll doctor shop until she’ll find someone to attend to her hypochondria. I can’t tell you how many ultimately unnecessary endoscopies she’s had that were fully paid for by Medicare and her co-insurance. She’s a beautiful candidate for an HMO, but she opted out after a year in a Medicare CHOICE+ plan because she didn’t like how limited she was in her health care choices. Finding the balance, where health care that is necessary is available without too much concern for cost, is probably our greatest challenge.
Also, EMTALA, while great for ensuring that most emergencies are taken care of, means that we have a very inefficient primary care system that’s run out of emergency rooms instead of health clinics. People without health insurance know that if they show up to the ERs, they have to be evaluated and stabilized before they are transferred or discharged. The problem is that often they wait until whatever disease or condition has escalated to the point that it really is an emergency. There are few in-between places for these people to go to for preventive, primary care. Some of counties run community health clinics, and those are great, but they’re not very well funded, and usually are understaffed and overcrowded. We need a safety net outside of the ERs for primary care for people without health insurance, especially since the managed care companies and other payors have done a very good job of whittling away the margins that the hospitals were using to fund un-reimbursed care. ER treatment is extraordinarily expensive, and using the resources that are wasted in the ERs to develop more community health clinics would be much more effective.
I think CMS actually is fairly well run, though each fiscal intermediary is a little different, so it depends on where you’re located as to how good your experience with CMS is. CMS is the best payor out there for processing claims, though it often has the lowest reimbursement rate. I’m very hopeful that once the software glitches in the HIPAA transactions and code sets get sorted out, the other payors will be on par with CMS in terms of turn around time for payments and that the administrative costs of health care will diminish considerably. I’ve read a few ROI studies on the transactions and code sets, and I do really think that despite the nightmare of getting them implemented, that they will help considerably in reducing some of the administrative costs of healthcare. I wouldn’t be surprised if in the next two or three years the staffing at CMS, the intermediaries and the health plans will end up being cut.
Ultimately, I think that we’re heading for means testing on Medicare and that the new prescription drug benefit will have to be amended to reflect income of the recipient. Unfortunately, baby boomers are aging and they will want the most possible benefits. Finding a way of cutting Medicare with that voting bloc sitting there will be difficult, though I think it would be a lot easier, especially given the recent revelations about the withheld cost estimates, to roll back the prescription drug benefit.
