Robert J. Samuelson writes an extremely disappointing and misleading article about health care policy in today’s Washington Post.
The column starts out fine with Samuelson looking at the basic OECD data that shows America spends dramatically more on health care than any other industrialized country on earth but doesn’t get better health outcomes as a result. He correctly shows that a big problem with the American health care system is that we pay substantially more for the exact same services compared to what Europeans pay. He even points out we don’t actually use more health care than most other first world countries; we just overpay for what we do use.
The problem is that the column falls apart terribly at the end when Samuelson states there are essentially two ways to fix our system.
One is a voucher system that, through tax credits and fixed Medicare premium subsidies, would allow patients to shop for the best health plan. Competition, the theory goes, would force hospitals and doctors to restructure the delivery system; health plans would compete on the basis of price and quality.
The other way is a government-run, single-payer system that would — somehow — include strict budget limits on doctors, hospitals and other providers. Lower administrative costs alone wouldn’t provide enough savings to control overall spending. If open-ended reimbursement survived, so would the existing system.
This is just wrong on some many levels. There is basically no credible data to show that a voucher system to purchase private insurance would work to reduce health care costs. The Medicare Advantage program, which was supposed to save money through competition among private insurers, ended up significantly more costly than regular Medicare. The federal employee health care exchange system, which relies on private insurers and was also supposed to benefit from the magic of insurance competition, has also failed to control costs.
Just paragraphs before offering this solution Samuelson states, “government regulators and private insurers are too weak to control costs.” If you are basically claiming the problem is that private insurers and government have too little market power to effectively negotiate for cheaper services, how is radically diluting that market power over hundreds of million of people with vouchers going to magically make things better?
To say there is a “theory” behind this voucher nonsense is too kind. It is a fantasy that some believe in spite of all the data to the contrary.
While I personally support single payer, it is beyond silly to start a column talking about all the other international health care systems but then pretend they don’t exist as possible solutions to our cost problem. There is a whole mix of different systems in use in other countries with varying levels of government involvement, and all are significantly cheaper than our own. Even adopting an all-payer system with private insurance and private providers, as in Japan, would likely significantly reduce our health care spending.
The main reason other systems are cheaper is that they have a mechanism to limit providers with basically near monopoly status, like drug companies and hospitals, from using that market power to dramatically overcharge patients.
There are many ways to reduce our health care spending; simply adopting the better health care systems of any of several dozen other industrialized countries would work.
Part of the problem in America is that instead of logically choosing a solution from any of the other proven health care systems currently in operation, our political leaders and pundits keep getting away with claiming that a disproven market fantasy can magically fix everything.



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This is NEWS?? He’s a hack that has no credibility, just like the paper he writes for.
Before I cancelled my WaPo subscription during their cheerleading in the run-up to the Iraq war, I read Samuelson regularly. Ignoring reality was a feature, not a bug.
I’m not sure, but I may owe you a drink.
What’ll you have?
BTW Jon, THAT QUOTE WAS AWESOME!!! Free market fantasizers indeed.
Considering the hour, I guess I will have another glass of iced tea.
By the way, SouthernDragon’s birthday is tomorrow. Stop by the Lakeside Diner and wish him a happy one.
While both liberals and conservatives continue their robot-like fixation with health care costs, the real crisis in medicine goes ignored.
The number of new antibiotics approved by the FDA is now less than one third what it was in the 1980′s. The number of new drugs in general approved has been a downward trend since the mid 90′s and is less than half what it was, and is less than 20 per year. The troubling trend continues – the number of new medical devices is down also by 50% over the last decade. And most recently, venture capital has been fleeing biotechnology in favor of Silicon Valley.
Any liberal program to control costs through squeezing drug companies and hospitals needs to be coupled with massively increased federal investments in R&D, breakthrough biotechnology, medical device, and drug development. Yet, when health care is discussed by both left and right, there is a near complete lack of interest in promoting technological innovation in medicine so that we can continue the decades long decline in mortality rates from cardiac disease, and develop cures and treatments for diseases as effectively as we have done so recently for HIV/AIDS.
Really??
Wow, unbelievable. Mine was Friday. Didn’t know SD and I were astrology brothers.
One tall, iced tea, with a very slight twist of lemon, coming down the bar!
And this decrease in drugs and devices is bad?
Please explain why.
Also explain what and why is causing this? If they’re making fewer drugs, or devices, then that should be mentioned.
If less are being approved, then why are less being approved.
Pharma, as a group, are the same “good” people that use shortages to jack up their prices on regular people.
And giving them more taxpayer R+D dollars, so they can profit while selling us their marked up goods, while we the taxpayer, who paid for the R+D, don’t see a penny …? And why would I want to support this?
Businesses that must always grow is not a realistic or sustainable idea. It’s ludicrous (not the singer). The way they do this is to gut us all. And why would I support this?
TYPO ALERT!
“This is just wrong on so
memany levels.”“There are many ways to reduce our health care spending; simply adopting the better health care systems of any of several dozen other industrialized countries would work.”
——————
I personally experienced how the healthcare system in New Zealand works. And it works just fine, thank you very much. Ther are “some” compromises that are made, but nothing serious. All the Kiwis I met while down there, in the hospital, were pretty darn happy with everything. Danm hot nurses too!
Just the way I like it (I use sweetener, too).
Dragon Man and I are about the same age — actually we share a birth year, but I’m nearly a year older (mine is in January).
In America something like half of all bankruptcies are caused by medical expenses. That should tell you all you ever need to know about our so called Health care system or lack thereof. We shouldn’t flatter ourselves by calling this a civilized 1st world country anymore.
Vouchers. Just call it competitive shopping. What a country!
As far as I can tell there has been zip innovation and development of better treatments since the 70′s. And the doctors are less and less able to even diagnose, much less the treat illness of the individual. Is there a word that is more extreme than “crisis?”
See my #14. This is especially true for pharmaceuticals. Since they dropped much of the government funding for non-profit university base programs in favor of the business community (I am probably missing one or two examples but) there really has been no advance in developing new approaches…… only modifying existing drugs,
The whole discussion hinges on profits for investors…nothing else I see driving the ship of state. Free market capitalism at any price. People can starve in the streets die in the emergency waiting rooms sleep under bridges they want at least 18% return on their investment. Greed rules.
Funny how he leaves out the unconscionable pricing rackets of medical equipment and pharma companies under “other providers.”
FDA approval is still fast-tracked as started under Reagan, the corporate/university R&D partnerships are still allowed and encouraged, and pharma’s profits are through the roof. But they’re not completely deregulated and subsidized. I guess they’ll never get a break.
the u.s. healthcare system is the ultimate business for the psychopathic capitalists that run America. Imagine, you have the power to deliver life or death, and then you get to sell it to the highest bidders ! What a great way to make money ! Absolutely no possibility that demand for your product will ever go away, everybody needs you, year after year ! Just keep raising prices until you transfer ALL the wealth of your customers to yourselves ! They have no choice, they have to buy from you !!
Woooopeeeeeeee !!!!!
5. HEALTH CARE
A. Raise the Medicare entitlement fee to 2% of total income including wages, salaries, bonuses, interest, dividends, capital gains and other forms of income. Those paying more than $2,000.00 will receive a tax deduction.
B. Allow Federal government to negotiate with PHARMA industry to lower drug prices.
C. Allow VA Hospitals to care for low income non-veterans.
D. Carry out the Medicare/Medicaid cost reductions mandated by the Affordable health Care Act so that the growth can be slowed. Putting these provisions into action fully and as soon as possible is the best way to reign in spending.
E. Allow Medicare to bundle payments for several standard procedures nationwide phase in over the next four years payments for all procedures and primary care completely replacing ‘fee-for-service’.
F. Implement competitive bidding for durable medical equipment, prosthetics, orthotics, laboratory tests, pharmaceutical and other medical supplies.
G. Require electronic eligibility, claims processing and payment as well as centralized physician credentialing.
H. Do not pay extra for technologies that are more expensive but no more effective than other available technologies.
I. Allow all citizens a under the age of 60 a choice between a Medicare Public Option or private health insurance. All over 60 would receive Medicare.