The Best Health Care Reform is Impossible

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I'm reading Bruce Bartlett's crowd-sourced interview with Economix readers, and this part strikes me as a reasonable -- and familiar -- conservative critique:

I also believe the administration has done a poor job of addressing what I think is the biggest problem with the American health case system: It costs too much for what we get. We spend in total twice as much of our gross domestic product on health as most other major countries without getting much in return for the extra spending.

Hey, that reminds me of something!


Two weeks ago, Ross Douthat wrote pretty much the same thing in the New York Times, before suggesting that we scrap the current apparatus and replace it with a new system where Americans pay for day-to-day medical out of their own pockets and the government provides "catastrophic insurance":

Three major problems plague American health care. The cost of premiums is eating up an ever larger share of take-home pay. The cost of our public health care programs is eating up an ever larger share of the federal budget. And millions of people who need insurance are priced out of the market.

Now that Max Baucus's version of health care legislation has been blessed, at least provisionally, by the hands of Senator Olympia Snowe of Maine, it's increasingly likely that Congress will pass reforms that address the third problem, while making the first two problems somewhat worse.

And hey, that reminds me of something else! Yesterday Gregg Easterbrook, in his weekly ESPN column that occasionally touches on public policy, said pretty much the same thing:

Gradually transitioning to a system in which most people carry catastrophic-cost medical insurance but pay the rest themselves could rationalize health care economics while restraining costs, because the wasteful paperwork aspect of the system would decline.

Three moderate conservatives, one critique: The health care reform bill doesn't do enough to bring down costs for the government or for individuals, and the only solution is to effectively blow up the system. The only problem with this idea is that it imagines a world without politics, or special interests, or elections. As Megan McArdle has said on numerous occasions, cutting doctor reimbursements loses you the AMA. Cutting services loses the AARP. Trying to punish plush plans loses the unions and the rich. Benefits are sticky, and elections are frequent, and it's very, very hard to scrap parts (much less the whole) of a system worth more than $2 trillion, because most dollars a reformer identifies as "waste and abuse" some group will identify as "my meal ticket."

All of which is to say that somewhere down the line, the general consensus might be that health care reform failed to boldly cut costs, bend the curve and revamp a "broken" system. Somebody will try again. They might even succeed in changing the system more radically than the Senate plans envision. But let's at least agree that barring some tangible health care disaster, it will be a Herculean, if not impossible, task.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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