Nancy-Ann DeParle, the Director of the White House Office of Health Reform, posted a note – ironically titled “Reality Check” – on the White House blog this morning claiming that a new report from the federal government’s health actuaries supports the administration’s position on health care reform.
But all that report says is that U.S. health care spending continues to increase – even though the rate of increase actually hit a historic low in 2008 (the latest year for which figures are now available). DeParle’s argument is basically this: We spend too much on health care, therefore the reform proposals currently in Congress will fix everything.
However, DeParle seems to have missed the actuaries’ earlier report on what those reform proposals will actually do – which is, to make health care spending grow faster, not slower. In particular, actuaries estimate that if the Senate health reform bill becomes law, total U.S. health care spending would increase by 0.7%, or $234 billion through 2019. And that’s after taking into account what little savings would be achieved by cutting Medicare benefits and encouraging employer to cut health benefits by taxing private insurance plans that are “too generous.”
In other words, the primary source of “savings” in the Senate bill comes not from making the health care system more efficient, but from (1) denying health care services to seniors under Medicare, and (2) from encouraging private insurance companies and employer to deny health care services to everybody else. Even after taking account of that so-called “savings,” total health care spending would still increase faster than it would without reform!
The inescapable conclusion is that reform proposals currently in Congress will take an inefficient health care system and make it even more inefficient than it is now. One does not have to be one of what DeParle dismissively calls “defenders of the status quo” to oppose a reform plan that will produce a result clearly even worse than the status quo.
DeParle claims that if “opponents of reform get their way,” health care spending will continue to increase. The fact is, if the administration gets its way, health care spending will increase faster than it does already and we’ll get less health care for our money. If opponents get their way, we might instead have real reform that gives patients more choices, gives providers incentives to give the best treatment instead of the most expensive treatment, and ultimately better health care at a lower cost. Unfortunately, that’s the opposite of the outcome the bills in Congress would give us.
The “public option,” or government-run health insurance plan, in the just-released House health care bill was previewed in the news media as a diluted form of hard-core liberal versions that the Left have pushed for months. While that may be the case, calling the public option “more conservative” isn’t appropriate for any form.
To be fair, the intent probably was to distinguish this new public plan as a “government-lite” option because it’s supposed to let doctors and hospitals negotiate rates with the government over payments for health care services. Earlier public plans used Medicare rates (which are really price controls) to compensate doctors and hospitals — far less than what the private market pays.
As we scour through this 1,990-page monster of a bill (topping the 1,502-page health bill from the Senate Finance Committee), it will be important to determine how the feds and health care providers will come to these negotiated rates. Plus, other questions crop up, like will the government-run plan be subject to the same rules and market regulations that private insurers face? If we see the same language in the new House bill that was in H.R. 3200, then government will operate on an unlevel playing field where it has a clear advantage in the marketplace.
The bottom line is that any version of the public plan — whether it’s in the form of a trigger, an opt-out option for states or a bureaucratic cartel moonlighting as a co-op — is not conservative. Conservative health reform puts health care decisions in the hands of individuals and families through reforms on the tax treatment for health benefits and insurance market changes that put the consumer in charge.
This government-run health plan will be a wholly owned subsidiary of Congress. It will progressively displace existing private coverage and give Washington more direct control and decision-making power over the health care of ordinary Americans. If it is financed like most big public health programs, it will accumulate Medicare-style debt, while, as numerous reports from the public and private sectors show, canceling private health insurance for millions of Americans.