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November 10, 2009

Democrats address health-cost spiral -- finally

Nice to hear at least lip service from key Democrats over the lack of cost controls in the health-reform legislation advanced so far. Good NYT story from Sheryl Gay Stolberg on intra-Democratic tensions over the tradeoff between making sure legislation has cost-cutting teeth but not enough to hack off medical constituencies who so far have backed it. The Emanuel brothers find themselves on opposite sides. Budget czar Peter Orszag is trying to stifle himself. But his "absolutely" below, answering his own question about whether future cost control will be necessary, means "really, truly, totally yes and I completely mean it -- no matter what's in this bill."

“Let’s be honest,” Rahm Emanuel said in a recent interview. “The goal isn’t to see whether I can pass this through the executive board of the Brookings Institution. I’m passing it through the United States Congress with people who represent constituents.”

He went on: “I’m sure there are a lot of people sitting in the shade at the Aspen Institute — my brother being one of them — who will tell you what the ideal plan is. Great, fascinating. You have the art of the possible measured against the ideal.”

Mr. Orszag would not be interviewed. But in an e-mail message sent through a spokesman, he said the current legislation “lays the foundation” for cost-cutting over the long-term, adding: “Will more need to be done in the future? Absolutely.”

Posted by Jay Hancock at 8:37 AM | | Comments (6)
Categories: Health Care
        

Comments

Jay,

This good liberal from the New Yorker opines that health care reform is not about health care but about growing government. Congress is selling America a bill of goods. We most certainly will pay the bill, who knows if we will want the goods.

Read this and weep for our children:
http://www.newyorker.com/online/blogs/johncassidy/2009/11/some-vaguely-heretical-thoughts-on-health-care-reform.html

- The Pelosi bill, in particular, wouldn't do much, if anything, to address the overall escalation in health care costs, much of which is rooted in the nature of insurance, where individuals consume costly health services, and different people-the other members of their risk pool-pay for them.

- If health care reform goes through, and the Bush tax cuts expire in 2011, top earners will face a marginal tax rate of forty-five per cent at the federal level. Add in state and local taxes, plus Social Security and Medicare payments, and wealthy people in New York, say, would be facing tax rates of about sixty per cent. As sure as night follows day, this would generate more tax evasion and a political backlash. Without a doubt, the next Republican controlled Congress would reverse the changes.

- What about the proposed cost savings? They, too, are questionable.

- I might even claim that some subterfuge is historically necessary to get great reforms enacted. But as an economics reporter and commentator, I feel obliged to put on my green eyeshade and count the dollars.

It is hard to think that any elected representative in their right mind would dismiss the need for future efforts in cost containment even though they are at present attempting to ensure coverage for as many people as possible. By quietly mentioning cost controls now but deferring action until later, they can walk the fine line that gives them both more populist support and wiggle room when they ultimately need to make the harder and more realistic choices.

Jay, while I will certainly agree that health care reform is something that is needed, the bill passed by the House is an incomprehensible piece of mish-mash that would make criminals of average American citizens (with fines and possible jail time) and create new uncontrolable bureacracies that will spend us into ruin. Nineteen hundred and eighty pages is simply a nightmare and not something, I see, having a good outcome.

Dr. Cortese is right on the money, as is Ron Wyden's assessment, and I'm in favor of bundling.

My biggest complaint about the bills proposed is that they aren't so much reform as shuffling responsibility for different aspects of the health insurance system. The House bill fail to address the long-term problems facing our system, and just like legislative trends of the past 30 years, pushes the "due date" to truly address problems further and further down the road.

I'm still not relieved until lawmakers bring up the fact that we get very little good result from so much money spent. Look at the doctors, folks, they need to be held accountable - just like the rest of us - for a good job well done.

One inept doctor is all that is needed to skew costs. Let's minimize the ineptitude in the medical community.

Nice to hear at least lip service from key Democrats over the lack of cost controls in the health-reform legislation advanced so far. Prevention is always better than having to administer a cure in the long-run and so it is with the multitude of problems caused by self-harm.

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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