Tuesday, September 10, 2013

Despite Acknowledgement of Current Dysfunction, ObamaCare Doubles-Down on Previous Government Interventions

This is Paul Howard writing at Forbes:
... It’s ironic that at the very moment that Obamacare is poised to spend nearly $2 trillion to expand traditional insurance coverage to about 30 million uninsured, new synergies between genomics companies and providers, advanced diagnostics for remotely monitoring patient treatment and detecting serious illness at earlier stages, and a wave of mobile health apps are unraveling old assumptions about how care should be delivered and financed.
Top-down controls on health-care spending and bureaucratic panels embedded in Obamacare will inevitably clash with the emerging bottom-up, patient- and consumer-focused market for personalized health solutions at affordable prices.  If anything, science and smartphones will lead us to devolve more responsibility and discretion to individual patients and physicians for producing better health outcomes—making government guidelines (however well-meaning) for how care is delivered and who must deliver it outdated before the ink is even dry.
Everyone wants better health.  But the impact of health insurance and health care in maintaining health is not clear, at least not in our current hospital and labor-intensive health-care system – where interventions occur only after someone becomes sick. (Indeed, an overview of the literature shows no evidence that health insurance benefits the non-elderly.) Prevention is a distant second order priority, and certainly not well reimbursed.
While recognizing that our current system is deeply dysfunctional, Obamacare’s architects doubled-down on previous government interventions: adjusting payment rates (especially for Medicare providers), adding new insurance subsidies and regulations, and tweaking the delivery system (through Accountable Care Organizations) with new, bureaucratized pay for performance formulas.  The scale may be more ambitious but, in one or another variation, we’ve tried many of these approaches before and the results of current experiments are are not terribly encouraging.  As one provider put it, there’s “an awful lot of sticks and not a lot of carrots” in the current approaches.
It not surprising that Washington wants more control and standardization in health care pricing and delivery.  But while industrial policy – regulated delivery systems at regulated prices – has fallen out of favor in most other sectors of the U.S. economy (like trucking, airlines, and telecommunications), in health care it remains stubbornly resilient.
Why? Washington’s view of health care remains deeply entrenched in mid-century assumptions about health and illness.  Health care via industrial policy makes sense if illness is an Act of God to which all are equally vulnerable and a known quantity of health care can be delivered to everyone at a fixed price.   If these assumptions are true, the largest payer – the government – can set the rules of the road, from which all (or almost all) benefit. ...