M.I.T. Economist Jonathan Gruber continues to leave people radically less informed about the real health care cost issue in this country with public statements that frankly make no sense. The latest example is from a Washington Post article about Massachusetts’ attempts to control health care cost.
“Cost control isn’t easy,” said M.I.T. economist Jon Gruber, who advised Romney on the 2006 reform law. “On this cost control stuff, we have to be exceedingly humble. We’ve got to bend that curve eventually, and it’d be nice if it was sooner rather than later, but right now there’s too much impatience.”
“We don’t know the answers” about the best way to control health-care costs, Gruber said. “We just have to experiment, and be patient.”
It is not like there are, say, 25 other first world countries that provide equal or better quality health care but for a fraction of the cost we pay that we can examine to learn how to make health care in this country cheaper… oh wait there are.
While I guess it’s true in some abstract sense that it’s impossible to know the absolute best way to control cost, we have a plethora of real world examples of how to control cost radically better than we do here.
Given that the big driver of USA health care cost is not higher utilization rates but the fact the price we pay for the exact same treatments is radically higher, we should look at why other countries pay less for the exact same medicines, tests and procedures. The answer is simple. In other countries there is a single price negotiated for a particular treatment.
This is either simply the price the government agrees to pay in single-payer systems or a price all insurance companies, together with the government, decide to reimburse at in an all-payer set up. Not only does this monopsony purchasing power result in lower prices, it also eliminates the massive administration waste created by our system where people get a discount for paying in cash so hospitals can avoid the endless fights based on different prices charged each insurance company, government program, and individual.
Given the decades of international and national data, there should be no doubt single-payer or all-payer systems are huge proven steps we could take to radically control cost. Of course the industry players don’t want this, because it means lower profits. But that is exactly why it is incredibly unhelpful to have so-called “experts” pretend the reason we don’t have lower cost is because there is a great mystery here. They instead need to admit it is simply a problem of politicians unwilling to oppose industry lobbying (and loss of compaign funding) to adopt a proven solution.
I know I should expect no less than this nonsense from Gruber. After all this man was actively selling the Affordable Care Act to journalists, while not disclosing that he was paid hundreds of thousands by the Obama administration, by claiming this:
My summary is it’s really hard to figure out how to bend the cost curve, but I can’t think of a thing to try that they didn’t try. They really make the best effort anyone has ever made. Everything is in here….I can’t think of anything I’d do that they are not doing in the bill. You couldn’t have done better than they are doing.
Not only did the Affordable Care Act not contain single payer or all-payer, but it also purposely excluded provisions that the CBO said would reduce cost, like drug re-importation, because a deal was made with the drug lobby to keep their prices artificially high. Gruber has a long history of working hard to promote the idea that proven progressive cost control ideas don’t exist.