Zeke’s Magic Pony
In a feature in the March GQ that’s apparently not available online, Zeke Emanuel, brother of Ari and Rahm and senior counselor on health matters to President Obama, describes his vision for a new health care system:
I think there are three main goals: get everyone covered, serious and meaningful cost control, and improving the quality of care. You gotta get all three.
Now, Zeke’s a bright guy. MD and PhD from Harvard and, well, one of the Emanuel brothers. But, um, those goals are mutually exclusive.
Covering everyone will either cause costs to skyrocket, care to decline, or both. Cost control will force people out of the system, care quality to decline, or both. Raising care quality will either increase costs, force people out of the system, or both.
There’s an old saying: “Fast, good, and cheap. Pick two.”
Ah James, but you live in the real world where the sky is blue. I fear that the Emanuel brothers all suffer from an all too common affliction of the super-talented: stupefying intellectual arrogance. The world is their laboratory for God-like “the rules that apply to you don’t apply to supermen like me” thinking. Liberals like this simply cannot accept (or even fathom) that the free market will yield the best result possible in a world populated with tragically fallible human beings, and any attempt to improve on its performance (or Lord forbid, achieve perfection) actually worsens the results from the free market optimum (as we in fact have right now in the heavily government impacted health care space). Which of course leads to the very cycle of government fix => worsening conditions => more government => even further worsening that people like his brother Rahm “Never Waste A Crisis” exploit. It seems our society needs to periodically go through a self-destructive Quest For Perfection every generation or so to teach everyone with no knowledge of history (a sadly large majority in America) exactly how things work in the Real World. This then clears the way for someone to arrive on the scene (like, oh, Reagan) and restore at least some semblance of free market functionality (albeit never as much as in the past).
It seems to me to be a cycle we will never be rid of.
We’re not in for 4 years of this level of analysis, are we? I hope not.
“Cost control” does not mean “reducing costs below where they are now.” Of course costs will go up with universal coverage. Cost control in that context means getting more efficient results from the money that you *do* spend, as opposed to the present system.
Quality of care is not antithetical to either universal coverage or cost control, if they’re practiced intelligently. More isn’t always better. Electronic health records hold the potential to coordinate treatment and to study what works and what doesn’t on a scale previously impossible. That alone promises huge quality improvements.
Interpretive charity is the difference between smart and snark.
Other industrialized nations cover all their residents, spend less per capita, and have better health outcomes. Think before you write, Joyner.
Since federal law mandates that hospitals treat ALL emergencies, in an odd way we are all covered (a republican congressman reiterated this position recently)- the question is whether there is better way do things (showing up in a hospital with bleeding pneumonia can be hazardous to one’s health and the health of other). And yes, Mithras is correct- are other countries that superior to the U.S. that only they could find the magic elixir? More to the point: for the sake of global competitiveness, the U.S. will need to fix its health care issues.
Anderson: I don’t doubt there are efficiencies to be had nor incremental improvements in outcome based on the application of technology, elimination of duplication, and so forth. But we’re also greatly going to increase demand. And, as Dave Schuler points out frequently, there’s also the matter of controlling access and illegal immigration.
Mithras: Other countries with similar population density and demographics?
Raoul: I agree the emergency system is out of whack.
In the abstract perhaps, but if your starting place is poor in all three, you can do an optimization to a better place on the map.
He’s got the priorities wrong. If the cost of healthcare were to be dramatically reduced, insurance would be more affordable and, consequently, more people could be covered. Without meaningful cost control in healthcare we simply can’t afford universal coverage.
We can get marginal cost reductions by adopting reforms along the lines of France’s or Germany’s systems. Neither country has socialized medicine and outcomes in both countries are comparable to ours, with the caveat, as Steve Verdon would insist on, that things are hard to compare when they aren’t measured the same way. A WHO study of the OECD countries from a couple of years ago found comparable waiting times and outcomes for most surgical procedures in France, Germany, and the United States.
But at most we’d save 20% by adopting those reforms. For really significant cost savings we’re going to need to change the way healthcare is delivered.
The cost of anything… including healthcare… goes up in direct proportion to the amount of governmental interference in the process. So, if cost control is the target, as Dave suggests, wouldn’t the logical solution be to get government the hell out of the way?
Dave how do you resolve the internal conflict between cost-based insurance and universal coverage?
I mentioned yesterday my friend who got a pacemaker at 14. Who does he go to in such a scheme for coverage?
BTW, I’d certainly call the French system socialized. It may be a pretty good system, but I think the word fits.
But James…. European countries have full coverage, spend less on health care as a percentage of GDP, and by any empirical measure — life expectancy, overall survival of illnesses, infant mortality — have health care systems at least the equal of ours.
Yes, yes, there may be some diseases where people survive longer here, and there are also some horror stories about wait times and so on, but there are plenty of horror stories here as well. If you look at data rather than anecdotes, it is clear that Canada, France, etc. have found a model that is all three of those supposedly mutually exclusive outcomes.
What Mithras said. We spend by far the most on health care of any nation in the OECD (measured either per capita or as a percentage of GDP) yet we have the worst outcomes by most measures (see Ezra Klein’s Health of Nations series for way more on this).
James replied:
Some OECD countries have higher population density than the US (e.g. in Europe) and some lower (e.g. Canada). As to demographics, most OECD countries have older populations than the US.
It’s impossible to control for every variable, but one would have to be willfully blind to look at the global data and not conclude that we’re spending way more for less. Face it, our health care system is woefully inefficient.
Bithead:
That’s just empirically false. E.g. Britain spends less than half as much per capita as we do on health care, even though a large majority there get their health care through the National Health Service.
Yes Crust, but Bit’s comment is truthy …which matters more.
Heh… The point you both seem to ignore is the Brits aren’t GETTING healthcare. They’re waiting in line, which, of course, is cheaper.
Uh, no. Under the French system something like 85% of the costs are covered by tax dollars; here it’s something like 60%. 25% is not the difference between a socialized system and one that isn’t socialized.
I would only characterize systems like the British or Canadian national health systems as “socialized medicine”.
Bithead:
Well, your original claim was purely about cost so that doesn’t really work as a defense.
But your new claim is false too. Yes, there are some measures by which Britain comes out worse than the US (e.g. waiting times) but overall they come out a little ahead. Not nearly as far ahead as, say, France (that’s hardly shocking because the Brits are cheapskates on health care), but still ahead. The standard aggregate measure of the quality of health care is “preventable years of life lost” and by that measure UK beats the US.
Well, whatever it is, it is by an systematic empirical measure just as effective as what we do here.
There was a recent study (http://www.nytimes.com/2009/03/02/health/02scans.html?hp) that a huge chunk of MRIs for instance do nothing to help treat patients — they were either unnecessary or the equipment was outdated and useless. In these cases, having people just wait on line instead of getting those tests would have been equally effective and cheaper.
There is no getting around the fact that in the United States we do an absolute ton on unnecessary procedures and tests. Indeed, as far as I know, the only disagreement on this point is whether this is due to (a) fear of lawsuits, (b) poor professional standards for doctors, (c) profit-motive of physicians and insurance companies,(d) government mandates, (e) lack of a decent method for tracking medical data.
Contrary to James’ claim, I think most people who have looked at the issue conclude that if you deal with the right problems it is possible to get better, more comprehensive, and cheaper healthcare. The only debate as I say is between conservatives who blame government intervention and trial lawyers for the problems and liberals who tend to blame insurance companies, profit seeking, and underinvestment in technology.
Wow. All the big thinkers here and it only took 17 posts until Bernard Finel pointed out that the largest driver of additional costs in the US health care system isn’t the US health care system, it the US legal system.
Strip out the costs associated with “defensive” medicine (unnecessary testing, overwhelming malpractice insurance premiums) and you would go an awfully long way to achieving Emmanuel’s goals. But as long as the Democrat party is a wholly-owned subsidiary of Trial Lawyers, Inc. (John Edwards = Exhibit A), that will never happen.
Stop posting if this is the best you got.
The actual issue isn’t getting the most efficient results from the money we spend, but getting the growth rate in spending at or below the overall growth rate in the economy. If we cannot do that, then things will eventually get to a point where things turn really ugly.
I would add that at least in France’s case they are still facing a sustainability problem. The idea that switching to the French model would solve the problem is hopelessly optimistic.
What Bernard is missing here is that different countries use different definitions. For example, a neonatal mortality in one country isn’t the same as another. The U.S. uses the WHO definition. It could be argued that because of this the U.S. spends alot of money on caring for infants born with medical problems and obtains worse outcomes when in another country that child would be left to die and not make it into the official statisitcs as an infant death.
If one were to look at the data one would see that neither of those countries has a sustainable health care system…just like the U.S.
Here is an idea, one way to reduce costs is to stop using the WHO definition for a live birth. If a baby is born that does not meet that definition no extra efforts are taken to improve that child’s chances of living, and if the child dies it is not counted as an infant death. We save costs and improve our infant mortality statistics. What’s not to love?
Are you adjusting for differences in definitions? If not, then it might be misleading to make “head-to-head” comparisons using raw data.
There are a number of problem with health care. For example bad incentive systems. We see that with Bernard’s referenced article. In particular this quote,
The price system is not working. You should pay much less for a scan on an older machine than on a newer machine. Why? Because the older machine is much less likely to produce a good scan. If I can go out, buy an old machine, and send patients there and get the same amount per scan as with a new machine why not do it. Put in a price differential and suddenly keeping that old machine in service might not look so good.
My question is why do insurance companies not link the payments for MRIs to age of the machine? Seems like age of the machine has some corelation to the quality of scans.
Then there is the issue that Dave Schuler has brought up of Gammon’s Law. The problem here is that when the government gets involved the more money starts going to administration and less to actually providing health care.
Also, the tax breaks afforded to health care benefits. This distorts resource allocation in favor of health care.
And there is the issue of programs like Medicare. There has research indicating that part of the past increases in health care expenditures is due in part to Medicare.
Sure it does. Look, it isn’t a measurement of cost, whether not you actually get what you paid for? The only will reveal cost saving here, in reality, is the effect of limiting access to health care. If it’s cheaper, that’s because less people are actually getting health care.
Go tell that to the people that are sitting on waiting lines, and dying while they wait for an operating room, for example.
And B1’s point is a good one; please allow a slight expansion.
Does anybody really think that adding a layer of the political is going to improve access to health care? Once it is made subject to the politicians, it is always and forever trapped in that mold. It’s a matter not just of getting to the doctor, and choosing a good one, and taking care of the financial responsibility of such matters, you now add to it a shortage of doctors and the government mandated limiting on health care access. Somehow I have a great deal of problem accepting the idea that adding another butt to kiss in this process is going to help that much.
Other topics:
Well, I dunno, Steve; YOu tell me.
Steve Verdon:
I guess that’s why the percentage of costs due to administration are about an order of magnitude more for private health insurance than for Medicare. Ditto with comparisons of the US with other wealthy countries.
There’s some pretty serious aversion to empirical reality in this comment section.
I am sorry, I have not seen such data in any systematic form. Nor, until now, have I heard the claim that the definition of live birth is sufficient to overturn what is a mountain of other data showing that the health care systems of Europe and Canada are not inferior to that of the United States. I could see how, perhaps, this statistic could affect infant mortality rates. And it could affect life expectancy at birth rates… but there is no noticeable drop-off in life expectancy for at older ages. There is no superior survivability for major diseases. Etc etc.
True, there are lifestyle and diet issues that affect the data, as there are issues of age distribution, population density, etc.
But, honestly, while I have seen plenty of arguments that seek to poke holes in the claim that their healthcare is as good as ours, I have never seen a solid, systematic study of outcomes that demonstrates that we have the best health care system in the world… unless you use really idiosyncratic measures like time-to-treatment perhaps.
But even if you could find a systematic study that demonstrated our superior healthcare system, would it show that ours is 50% better than theirs? Because that is the gap in health care expenditures. And true, their systems may not be sustainable either… but maybe we could learn something from their cheaper, more available, and just as good approach to health care to inform our own efforts at reform.
And B1: Though I listed fear of lawsuits as a metric in the interests of fairness and because I am personally a supporter of tort reform, I think you’d be hard-pressed to find systematic data to show that this fear drives more than a fraction of our massive costs. Ultimately, there are all sorts of issues of professional responsibility that need to be addressed as well, as well, of course, as the need for a serious effort at patient education.
Steve Verdon / Bernard Finel: On infant mortality, my understanding is that WHO tries to adjust the underlying raw data to make apples-to-apples comparisons:
The statistics will always be imperfect of course and there will always be nits to pick. But the extremely high US per capita expenditure and the poor PYLL are dramatic enough that they should be robust to such data issues.
Payouts in malpractice cases amount to about .38% of the total healthcare system costs. Malpractice insurance premiums account for about 1% of total healthcare system costs.
Tort reform? Sure. That won’t get do much to reduce the costs of our system.
Steve:
I never made the claim that going to a French-style system alone would solve all of the problems with our system. It would be just one component of a major overhaul. As I’ve said ad nauseam before, we’ve got a supply bottleneck.
Crust,
Are you absolutely sure you are comparing apples to apples there with administration costs? Government is not like private industry. Talk about aversion to empirical reality.
I believe UNICEF tries something similar. Measurement error is a serious problem that can cuase quite a few problems when trying to do empirical work. As such, any empirical work should be taken with at least a grain of salt.
And of course this doesn’t look at policy issues that determine care. Does the U.S. tend to provide more care for low birth weight/premature babies thus driving up costs? Is there some sort of legal/institutional reason for this?
Bernard,
Then perhaps you do not know what you are talking about. You are relying on different sources of data that you seemingly don’t understand and are trying to draw conclusions from them.
Well how about this: life expectancy isn’t just a function of medical care. It is a function of a vector of other variables and until you control for them such comparisons are questionable at best. For example, we repeatedly hear that American are some of the fatest people on the planet. Okay, but can that impact life expectancy? Is the impact negatve, or positive? I’d expect the former, but can’t necessarily rule out the latter.
Further, on the cost side how do you assign a cost to someone waiting for their MRI who is in pain and with other possible negative effects such as limited mobility. I think the case can be made that those cost are externalzied in some systems.
There you go again Bernard. Exactly where in this thread have I said the U.S. system is the best? My position is that while outcomes probably aren’t really all that different if a careful analysis is done; the U.S. system is still horribly broken in that it wastes a great deal of resources and has a growth rate that is unsustainable. I’d hardly call that sufficient to qualify the U.S. health care system as the “best in the world”. So, can we dispense with this nonsense?
As for systematic studies that try to address all these issues, I don’t think much has been done in that area, so to make a claim one way or the other strikes me as wrong headed. That said, the U.S. is clearly heading in the wrong direction. I don’t think the notion of “faster, better, cheaper” is really viable. Just as we can’t grow the world’s food supply in a flower pot we can’t have increased coverage, lower cost growth rates, and improved quality. We are likely going to have to give up something somewhere and so long as there is an insistence on universal coverage that pretty much leaves quality. Now that doesn’t mean we have to give up existing quality, but future quality–increases in quality.
Dave,
No you didn’t, sorry if it seemed I implied that you did. I was just merely adding on to your comment.
Dave Schuler:
You’re right that the explicit costs of litigation are a very modest part of the problem, but in fairness there are implicit costs. In particular, fear of litigation is a part of the reason for excessive testing in the US as other commenters have mentioned.
I don’t have a lot of time. I apologize for dropping the quick thought, but I’d say that if those numbers are true then we are both socialized. The majority of our costs are born through government intermediation. Their majority being stronger, of course.
So that debate is over? And now it is time to improve our national health care system?
Look, I agree with all of this… but I think you need to own up to either rhetorical sloppiness or deliberate obfuscation.
Here is how the argument went: I said, we don’t have the best health care system in the world, but we do have the most expensive one. My conclusion was that it may be possible to improve ours by learning best practices from others in a way that allows us — in the short-run perhaps — to have more quality and coverage at less cost. If others can do it, we can.
You responded that I was comparing apples to oranges and that I was not considering the impact of different definitions. Now, that was not a rebuttal to my cost argument. It was not a rebuttal to my simplistic perhaps argument that we might emulate others. So what was it a rebuttal to? In the context of our discussion, it HAD to be a rebuttal to my contention that our health care system is not the best in the world in terms of quality. And if you were rebutting my argument that the U.S. system is no better than those of the Europeans in terms of quality, then you must have been arguing that our system is either demonstrably better or worse. I don’t think you were claiming the latter… So I assumed the former. Shoot me if I was wrong.
Or were you just trying to be a self-righteous prig by raising an wholly irrelevant objection just for the sake of picking a fight?
And I didn’t say just life expectancy… here I am the one deferring to “expert” opinion. I have said that if you create a systematic assessment based on outcomes, you cannot demonstrate that the U.S. system is measurably better. My understand, and please do correct me if I am wrong, is that if you develop a ranking system based on non-idiosyncratic outcomes, we do not come out ahead necessarily, though obviously we do better on some measures than others.
BTW, from the link I provided above:
It’s important to note that it says all legal residents are ‘covered’ and not that they merely have something ‘available’ in theory.
Bernard,
You are sloppy as well. You ignore costs unless they have dollar signs attached to them. You look at the raw data and make conclusions based on that instead of correcting for other factors that can be influenceing the data. Then you conclude I’m trying to argue the U.S. system is the best when nowhere do I do that.
What I was doing was pointing out the weaknesses in your comments. That you are a neophyte on this discussion. That doesn’t mean I have taken up a position diametrically opposed to yours.
Yes it is if the different definitions elicit different responses on the part of both the government and private entities. I noted that specifically:
Then there is the issue that waiting for treatment entails costs, costs that are externalized as I noted here. Perhaps the use of the word externalized is not clear, it means that the costs are not borne by those imposing them, and in this case they aren’t even showing up in an accounting ledger anywhere. It is very much like pollution. If a factory spews out smoke and reduces the air quality for people living near the factory it lowers their standard of living, but doesn’t show up in any accounting ledger. These costs are external to the market and are distortionary in terms of allocating resources.
These two things could distort the “official” statistics. To what extent, I don’t know. But saying we spend alot when other countries might be moving some costs “off the books” is not helpful.
No, see the above commentary. It is disputing your claims about cost. You might still be right, but the magnitude of difference might be smaller than the official statistics indicate.
Picking a fight? Nevermind I’ve written on this here before.* Yes, its all about you Bernard.
Oh and one last point on Canada…Canada is moving towards allowing more private provision of health care.
*I’d argue that most of the posts here on health care policy are written by either me or Dave Schuler, in other words, that is a tiny fraction of the posts I’ve written on the topic.
If I remember correctly, wait times were not significantly different between the US and most OECD countries. Again if memory serves the differences were almost exclusively for some few procedures in the UK and Canada. For the rest even the UK and Canada were comparable.
A 15-20% cut would be an excellent start. Couple that with reforms allowing nurses to provide more care. Push reforms to allow opening more medical schools and set a goal of 4+ doctors / 1000 pop and we could push that a good bit further. Couple it with tort reform for another 2-5%.
Increasing the number of medical schools and doctors is a long term goal, but this is a long term problem.
I guess that depends on where you draw the line.
Steve,
I would submit that those are entirely related goals. Adding efficiencies that reduce costs will lower rate of growth.
This ugliness will come unless root causes are addressed and efficiencies are one of several root causes. Rules about who can perform what care and supply of health care professionals are others.
As Dave mentioned, moving to a French or German (or Dutch) model would provide for some greater efficiencies and a considerable cost savings. Why oppose 15-20% cost savings just because it does not address all cost issues? I understand the need to address the other factors as well, but it does not strike as a good choice to push this aside because it does not address those issues. Rather it seems that we should address what of these issues we can when we can and that the argument should be do this as well rather than all or nothing.
But if it makes the problem smaller that is a good thing, no?
What other definitions are different? This is the only one I ever hear about and some effort is made to control for it.
For purposes of argument we can discount this one measure and the others remain. There are certainly demographic issues, but there is also a pretty good sample size and only the US (the one non-universal care nation) and Luxembourg fall on the bad side of the comparison. Why do you think that is? Given the number of countries involved, the remarkable difference in costs, and the measures indicating similar or better outcomes; don’t you think it reasonable to accept that universal care, or at least some models of universal care, offer a considerable cost savings while providing at least comparable care?
Gammon’s “Law” much like Murphy’s is not so much a universally applicable instrument as a kvetching about anecdotal outcomes.
As has been pointed out Medicare has considerably less overhead and other administrative costs than private carriers. Both have to deal with government, but it would be near impossible to argue that the government is not more involved with Medicare than with private insurance. How do you and Gammon explain this?
Why then is it that every other more nationalized health care system (other than Luxembourg) has a slower rate of growth in health care. Is Luxembourg the only fair comparison?
But only for some procedures in some systems and neither of those systems are near the top of the list of systems we are looking to for a new model. This is an argument against implementing a UK or Canadian model, not an argument against implementing another universal care model.
I agree and we are probably closer together than my above comments might seem to suggest.
The best I have seen is the OECD report Dave mentioned and I have referenced before. No comparison will be perfect, but it that does not mean the comparisons are necessarily without merit.
We are dealing with a goodly number of countries. There is quite a range of population densities (if memory serves the US is near average for OECD nations). There are quite a range of prevalence of obesity, but Germany for instance is not so very far behind (ahead?) of us on this measure. There are other demographic factors as well, but sample size should mitigate these.
As they probably should. They are not moving away from a universal care system though and that is where the current argument about the US system lies.
and
and
Steve, don’t patronize me. I don’t know who you think you are talking to. If instead of assuming I don’t know what I am talking about, you actually bothered to read the things I say, you’d likely come away with a different viewpoint. The fact is… your knowledge of virtually everything you write about is at the level of convenient trivia.
Yeah, so big deal, there are different definitions of “live births.” Fine. I noted that I had never seen a systematic argument that this significantly affected overall assessments of the quality of American vs. European healthcare. Instead of pointing me to such a report… which does not exist as far as I know… you accused me of not knowing what I was talking about.
Well, here is your chance… shut me up easily… provide a link to a report that uses systematic data to demonstrate that the difference in definition about live birth has a significant effect on aggregates measures of health care quality. That should be easy. You’ve mentioned it in at least 2 posts and 3 discussions. It is your pet piece of trivial in the debate. Given you much you bring it up, you must have something better than this:
I’d heard it as, “schedule, budget, and quality: pick two.”