Blog Debate: The Runaway Train of Costs
Published March 11, 2009 @ 12:05PM PT

Editor's Note: Joining us this week for a blog debate about what approach we should take on health care reform in 2009 will be Dr. Don McCanne, a retired family physician now serving as Senior Health Policy Fellow for Physicians for a National Health Program, and Jason Rosenbaum, a writer and activist, and the Deputy Director of Online Campaigns for Health Care for America Now! Dr. McCanne will be presenting the "single-payer" point of view, and Mr. Rosenbaum will be presenting the "public competitor" point of view. I will be moderating and asking questions to both of our experts-- including a question that was submitted by one of you!
Some quick background: HR 676, the “Medicare for All” bill which proposes to replace the private insurance industry with a single-payer system where the government covers everyone and pays for health care with dedicated tax revenue is the preferred option of groups like Dr. McCanne’s Physicians for a National Health Program, Healthcare-Now! (who have their own section on Change.org), and others. A public competitor which would give individuals the choice of choosing public or private coverage and compete directly with the private insurance industry is the preferred option of groups like Mr. Rosenbaum’s Health Care for America Now!, the Commonwealth Fund and others. Both plans have strong Congressional support – HR 676 had 93 co-sponsors in the House in the last Congress, and 64 in this one. Health Care for America Now! has 185 representatives and senators who have agreed to its Statement of Common Purpose, including the President and Vice President.
I’m grateful for Dr. McCanne and Mr. Rosenbaum’s participation! By prior agreement, the format is as follows: I will ask a question, one of them will give an answer, the other one will have a chance to respond, and the original debater will have an opportunity for a quick rebuttal before we move on to the next question. The order of debaters was determined by a coin toss. I’ll be posting a complete round of a question and its subsequent answers each day for the rest of the week.
The first question which, by coin toss, went to Jason Rosenbaum as follows:
During the March 5 White House summit on health care, the president said, “If we don't address costs, I don't care how heartfelt our efforts are, we will not get this done. If people think that we can simply take everybody who's not insured and load them up in a system where costs are out of control, it's not going to happen -- we will run out of money.” Obviously administrative waste in the private insurance industry is part of it, but not all –- a Dartmouth College study says we spend twice as much each year on treatments that are unnecessary or don’t lead to higher outcomes.
How does your solution help us get the runaway train that is the cost of health care in this country under control?
Update:
Read the response by Jason Rosenbaum of Health Care for America Now
Read the response by Dr. Don McCanne of Physicians for a National Health Program
Read Jason Rosenbaum's rebuttal
(Photo credit: steakpinball on Flickr.)
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Comments (7)
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Tim has been an online organizer and blogger on health care policy for the Obama for America campaign (during the primaries) and currently for the Committee of Interns and Residents/SEIU Healthcare, a labor union for intern and resident doctors. Views expressed here are Tim's, and don't represent the positions of CIR or SEIU.
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Hey, Tim, you wrote "Obviously administrative waste in the private insurance industry is part of it, but not all ..."
Yes, it's not all! It's FIRST of the TWO HUGE impacts. The SECOND HUGE IMPACT is the ripple effect that the first part has on the resulting excessive administrative costs in every medical-related service and facility! (Such as one of the follow-up actions from my physical yesterday morning, when the doctor's staff had to ask permission to the insurance company for what was a simple, straightforward decision by the doctor!) For heaven's sake, the total number, conservatively, is 25-30%! That IS the starting point for saving money, and President Obama knows it. The mystery to some is why he does not take the lead on this. It's not a mystery to me, and I'll explain it to anyone if anyone tells me that they want to know. Otherwise, perhaps readers will learn later.
http://www.medicareforall.org/pages/Contact_Bob
For now I must get back to work for now to finish the preparations.
Bob Haiducek
Bob the Health and Health Care Advocate
Posted by Bob Haiducek on 03/11/2009 @ 04:18PM PT
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Welcome back, Bob!
I'll be honest, I can't quite tell if you're actually correcting me or not or using question as a springboard. To be precise $300 to $400 billion saved in administrative waste is good, but would only bring our cost per person down to about $6,700 -- still thousands of dollars more than any other country. More needs be done in addition to tackling administrative waste. For instance, we also know from a Dartmouth College study that an estimated $700 billion in our health care is spent on treatments and procedures that are outright wasteful or at least do not improve health outcomes more than cheaper alternatives. That's a weighty question that we would still need to tackle if we could make all administative costs disappear.
Luckily, both gentlemen have some good answers to that question.
Posted by Timothy Foley on 03/11/2009 @ 06:25PM PT
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Tim, You've helped me realize a point that I unfortunately often forget to make about how straightforward the elimination of excessive administrative waste is.
First of all, that's interesting that you mentioned the Dartmouth study guessing a $700 billion savings per year. I'm sure the politicians love that study, as they probably think that it helps them attempt to deflect the increasing criticism that is coming their way about what the U.S. Congress has done to us for decades by not participating in the world-wide movement to efficiency in health care financing, as seen at this web page:
http://www.medicareforall.org/pages/World_View#worldactivity
That topic of treatment decisions is certainly a "weighty question." You used appropriate words. It's weighty in part because it is complex involving physician decision-making. I am sure that they worked hard to make the guestimate, but ... read on.
Most, perhaps all, ideas (other than the simplification of how the money flows) are associated with guesses and wishes, not solid estimates of savings. The simplification of the financing is the most concrete savings one can determine. That's why we're losing so many businesses and jobs to other countries. Companies want cost-efficient operations. They can clearly see the excessive cost of health care, because it impacts their bottom line of their financial books. They do not like it, so they move their operations and our jobs out of the country. Within the last several years some have encouraged employees who are in the U.S. to consider medical tourism to hold down costs. People take their needs for procedures to India and Thailand and other countries. Therefore, we even lose some health care business! Is this crazy or what?
Companies are impacted in so many ways. Just one obvious example, as highlighted clearly to Barack Obama (in his own health care meeting with citizens on 4/5/2007) by business people, is that they have to pay salaries to people to manage the health care benefits and that it's a challenging, costly function.
Anyway, back to the high level. Other ideas are fine. Citizens sincerely hope that they work out. But even some of those other ideas' savings will be maximized after we make the entire system of payments simplest with non-profit single-payer national health insurance. The doctors will have lower malpractice insurance premiums. The doctors will have much lower costs for operating their private practices. They will be spending significantly more time and more quality time on patient care. As a result, they will be happier docs (did you see that recent study about our troubles on that subject! wow!). Therefore, they can and will be more productive on and provide more consideration of such things as the topic of that Dartmouth study! Otherwise, that topic that "might" save that money could be just one more burden on our already burdened physicians.
We want the most obvious and clear-cut and clear savings to be the highest priority. We want the elimination of health insurance company bureaucracy, the government bureaucracy and the related supporting bureaucracy. A list of some examples of each are accessible here:
http://www.ninenineohnine.org/pages/Bureaucracy
We want this as the highest priority activity.
And we want it now. That's why I look forward to hundreds of thousands joining what could very "easily" become one of the largest grassroots campaigns this country has ever seen.
Of course, it might seem "easy" on the surface, but it will involve much citizen effort using a straightforward set of "tools" that will be provided.
The bottom line objective is that Americans get what we and the country as a whole both want and need.
Regards, Bob Haiducek
Posted by Bob Haiducek on 03/11/2009 @ 07:27PM PT
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Oops. I was a bit vague about the campaign, but people can put it onto their calendar to go to the following web page on April 1:
http://www.medicareforall.org/pages/Home
Posted by Bob Haiducek on 03/11/2009 @ 07:32PM PT
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We all have to realize that what we need is NOT insurance. What we really need is HEALTH CARE itself. A mandatory plan like Massachusetts' is the worst plan to me. Many people would buy a plan like high deductible to avoid the penalty and never go see a doctor even when they need. (by the way, my husband has one of these as well and yes, the money we pay is going straight to the insurance company's pocket.)
This is what we call "health care" in this country. No wonder we spend the most money for health care and not getting much of it.
We should stop having the idea of "The government has no right to control our health care," but start to realize, "The government has the responsibility to get everyone covered." This is what all other industrialized countries have.
NPR had a good interview about health care today.
http://www.npr.org/templates/story/story.php?storyId=101706614&sc=emaf
Posted by Yuriko Lee on 03/11/2009 @ 05:31PM PT
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Don't be fooled - HR 676 is the way to Universal Health Care! Insurance companies have no business making a profit by limiting my healthcare benefits. Single Payor Now!
Posted by Maria Kumagay on 03/11/2009 @ 07:46PM PT
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For healthcare Reform in my view is necessary: 1. enacting the Free Speech About Science Act, 2. Total reform of FDA as suggested by AAHF, 3. inclusion of Jrnl of Orthomolecular Medicine in Medline/Pubmed, and in www.healthfinder.gov and www.nih.gov 4. inclusion of orhomolecular medicine in curriculum of medical schools, 5. Government funding of orthomolecular research, 6. absolute defense of DSHE Act,
7. challenge EU and other countries to achieve Codex rules in complete harmony with DSHE Act.
Of course this is not all, but it belongs to the minimum requirements.
Posted by Herman G. van der Waals on 03/17/2009 @ 11:08AM PT
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