In Health Care, Even Common-Sense Reforms are Hard

In a column about whether our government can solve crises, Washington Post editorial chief Fred Hiatt writes:

[M]aybe the country isn't all that divided -- most of us would welcome common-sense improvements in health-care delivery and insurance -- but the system feeds on and exacerbates our differences.

Stop right there. Would most Americans "welcome" common-sense improvements in health-care delivery and insurance? No way.


Let's start by looking at why we need health delivery reform. There are a lot of reasons why health care costs are on an unsustainable trajectory, but one of them is that we use a fee-for-service model in which improvements in technology give us more (and more expensive) treatment options, and when we use more (and more expensive) treatment options, it drives up the cost of health services. There are a couple of ways to change this system. For example, comparative research could help doctors choose more exacting treatment plans, which would save money. Or a Medicare advisory counsel could suggest ways to streamline treatments and save money. Or taxing the most expensive plans might encourage employers to switch to insurance with lower premiums and higher deductibles and co-pays, which would force employee-patients to share more of the health cost burden and choose less expensive treatments.

But all of these ideas share one thing in common. They can be interpreted as restricting the ability of patients to access care. Fee-for-service gives the illusion of patient freedom because it offers, for some Americans, nearly infinite treatment options, if they, or their insurance, are willing to pay the bill. But in the aggregate, it drives up health costs for everybody else, pricing some Americans out of health care all together. You reason you don't hear about delivery-system reforms very often is precisely because these reforms are complicated and potentially unpopular.

Just look at the mammogram debate last week, when a task force concluded that women were over-using mammogram screenings. That's not dissimilar from the recommendations a Medicare advisory counsel would make. But did Republicans respond, "Great! Fewer screenings would reduce costs for Americans and their doctors"? No. They accused the government of rationing and said they were "scared" of its implications. I'm pretty sure this is an accurate glimpse of the future of "common-sense improvement in health-care delivery."

It's telling that, in an article about the travails of fiscal responsibility, Hiatt picks health-care delivery reforms as the one thing that would be politically easy to swallow. Sorry, Mr. Hiatt. I'm afraid the "exception" proves the rule.

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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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