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Ron Radosh

This conclusion is not one likely to be appreciated or taken to heart by liberal advocates of universal health care, or socialized medicine. Calling a Republican position “commonsense” is not what one expects to read in the MSM. Later, when he addresses the issue of the care cost curve, Brill concludes that Obamacare does nothing to restrain cost, contrary to the president’s claim that it does:

[The policy experts] know what the core problem is — lopsided pricing and outsize profits in a market that doesn’t work. Yet there is little in Obamacare that addresses that core issue or jeopardizes the paydays of those thriving in that marketplace. In fact, by bringing so many new customers into that market by mandating that they get health insurance and then providing taxpayer support to pay their insurance premiums, Obamacare enriches them. That, of course, is why the bill was able to get through Congress.

Obamacare does some good work around the edges of the core problem. It restricts abusive hospital-bill collecting. It forces insurers to provide explanations of their policies in plain English. It requires a more rigorous appeal process conducted by independent entities when insurance coverage is denied. These are all positive changes, as is putting the insurance umbrella over tens of millions more Americans — a historic breakthrough. But none of it is a path to bending the health care cost curve. Indeed, while Obamacare’s promotion of statewide insurance exchanges may help distribute health-insurance policies to individuals now frozen out of the market, those exchanges could raise costs, not lower them. With hospitals consolidating by buying doctors’ practices and competing hospitals, their leverage over insurance companies is increasing. That’s a trend that will only be accelerated if there are more insurance companies with less market share competing in a new exchange market trying to negotiate with a dominant hospital and its doctors. Similarly, higher insurance premiums — much of them paid by taxpayers through Obamacare’s subsidies for those who can’t afford insurance but now must buy it — will certainly be the result of three of Obamacare’s best provisions: the prohibitions on exclusions for pre-existing conditions, the restrictions on co-pays for preventive care and the end of annual or lifetime payout caps.

Call it, if you will, the law of unintended consequences.

If you are under 65, and think your insurance policy covers what health care you must have in the face of a medical catastrophe, think again. Read Brill’s findings about the specific cases of individuals whose savings and money disappeared after seeking necessary treatment, only to find that their insurance hardly helped at all. He makes an argument that lowering rather than raising the age in which Medicare kicks in will actually help lower costs, and make the market more competitive. Brill knocks the drug industry and the Obama administration for getting industry approval for Medicare by agreeing not to allow negotiating to lower drug prices, and also not allowing comparative-effectiveness research on drugs. 

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All Comments   (11)
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Actually, Mr. Radosh, the healthcare market is not one of monopoly (a single seller) but of monopsony (a single buyer). And that single buyer is, you guessed it, the federal government. The government has extensive bargaining power through Medicare, so much so that health insurers base their rates on what Medicare will charge for a service. Usually, Medicare undercuts pricing for health insurers and pays a flat rate to healthcare providers. Providers in turn mark up all of their services with the intention of maximizing how much they can get based on Medicare rates.

Why is Tylenol marked up 10,000%? A better question is why does it cost $100 simply to see a doctor for five minutes? Pricing is out of whack in the healthcare market; getting to a true market would require a repeal of Medicare at best or, at worst, a law that severely curtails that program to a service for the indigent or truly needy.
2 years ago
2 years ago Link To Comment
There is no end to the expense and no society can have the means to provide every perceived need to stave off unpleasantness, discomfort, dissatisfaction with one’s inherent health, physique, or age, and the inevitable death of every individual under widely different circumstances and degrees of unpleasantness. The issue of governmental subsidy of “orphan drugs” is an example of these issues at play. Do we socialize every personal problem? On the other hand, who should draw the line limiting how far to go? A “death panel” in some bureaucracy? The ultimate fact to remember is that denial of coverage is not denial of care. Insurance companies do not kill people. Living results in death. As William Penn said, “We can not learn to live until we learn to die.”
2 years ago
2 years ago Link To Comment
A sizable fraction of the patient pool have chronic problems of obesity, substance abuse, nutritional neglect, and problems related to live-style. Certainly many lower-income people and elderly people fall in this category. The implicit expectation held out by the health activists is that all people have some inherent right to the same condition of health (not just access to care) as the “privileged.” This is an impossible goal, and to engender that hope in the popular mind is to blame poor health, and ultimately death, on class difference. This is absurd and guaranteed to persist as a source of unending social division
2 years ago
2 years ago Link To Comment
The problem with medical care by government fiat actually is not failure to resort to market forces but rather that the government wants to extend comprehensive care to a huge segment of the population who can not (or even if they could, won't) pay for medical care. These include the people presently serviced by hospital "emergency" departments and those who would not pay $1 for a routine exam instead of a drug fix, fast food, the NY Times, or a tattoo, i.e., they are not in the market for medical care. To be responsive to market forces, one has to be a player in the market. These folks are not in the market and will not be so under the new government "plan," which ordains that comprehensive medical care is not something one chooses but has inherently.
2 years ago
2 years ago Link To Comment
Mr. Radosh,
Your point on the integrity of the article is very well taken.
When I read this, I couldn't believe I was reading main stream JOURNALISM again, TIME, no less. This could have appeared at PJ's or COMMENTARY. He followed the topic and layed it out cogently, deliberately and, I think, fairly. Call it 'journalism' or call it 'chops.' Maybe TIME will take serious note. Somebody at TIME thought this was worth publishing. Maybe they'll do it again.
2 years ago
2 years ago Link To Comment
Well, if you don't think traditional journalism is dead, look at what they are promising to do to Bob Woodward "after he is dead" and can't respond to their character assassination. He'll have a lesser reputation than a troll at Huffington Post.
And due to "sequestration", band aids will be removed slowly, creating much pain. And you really don't want to experience a "waxing" at any VA facility!
2 years ago
2 years ago Link To Comment
The high mark-ups hospitals impose on patients carry lots of hospital overhead. True, one can buy Tylenol or a generic equivalent at the corner drug much more cheaply, but that isn't what is happening. That $1.50 per pill also covers the cost of the hospital maintaining its own pharmacy on premise and the cost of having somebody move it to your bedside, make a record of that, and give it to you.

Brill's notion of price controls carries all the folly that such schemes usually do. Distortions will be introduced; certain items or procedures will become unavailable because costs rise faster than the price controllers can react and the hospital or physician won't sell the procedure at a loss. I can remember the last time something like that was tried, during the Nixon Administration (!), when wage and price controls were implemented to fight inflation. While they lasted only about 18 months before everybody was ready to throw in the towel, even in that short time things disappeared out of the supermarkets, notably lots of meat products.

But I do believe we can never have a free market in complex medical care: it's just too complicated. One of the assumptions behind free-market theory is that consumers have good ("perfect") information. But how can that condition be satisfied when the whole matter is so complex only highly trained medical people can really know what's going on?

One thing is certain: it will be expensive and only more so. It's (highly trained) labor intensive, it's high tech, and it's third party pay.

2 years ago
2 years ago Link To Comment
I read this article 10-14 days ago after a friend sent it to me. While interesting and I must admit I have forgotten much of it, one thing I specifically remember is Brill pandering to the audience about the cost of what hospitals charge for certain tests, justifying it by what Medicare will pay for the same test. Indeed, the costs he lists were outrageously excessive - no doubt.

However, here's my beef with Brill's article.

One of the biggest shortcomings that doctors face to day is Medicare reimbursements rates which will again be cut 2% at midnight. Many of the Medicare reimbursements don't even cover the cost of the procedure - hence, why so many doctors are refusing new Medicare patients - they get tired of working for free, sometimes partially absorbing the costs of the test.

I contend many hospitals and doctors are overcharging to compensate for the pitiful Medicare reimbursements. If we can't attract and keep doctors which are already in short supply in many disciplines, all the money in the world saved on healthcare will be meaningless when you are the patient.

I agree the system is broken - mainly because of defensive medicine because of perceived legal threat, a lack of coordination between primary care and specialists, and covering for the uninsured.

But using Medicare as comparison and assuming Medicare accurately assesses the true cost is equally as insidious as overbilling.
2 years ago
2 years ago Link To Comment
Once again, everybody, please bear with my re-posting yet again a blurb I entered onto any number of threads last month (and this), across the center-right blogosphere (including several PJM sites on several occasions). Still absolutely germane to the present topic, and still perfectly indicative of the state of journalistic ethics of the social media apparatchiki inside and outside of Obama's permanent campaign:

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Chris Hughes, who also got a ten-minute video tongue bath in today’s online NY Times, regarding his great plans for the venerable New Republic –which he’s owned outright since last March– was, of course, one of the original FaceBook developers which led in due course to him becoming a wealthy fellow indeed.

He was also in charge, during the run-up to the 2008 elections, of all the Social Media projects at the Obama for President campaign’s national HQ in Chicago.

I have much to say on Mr. Hughes’s likely responsibility for the outrageous DOS attack organized by the Obama for President HQ in Chicago just prior to the 2008 election on Milt Rosenberg’s WGN radio interview with Stanley Kurtz on the failed Chicago Annenberg Challenge (CAC) educational initiative, of which Obama was the Executive Director, and the role in the CAC of the despicable Bill Ayers. See:

http://www.sethathirath.com/chris_hughes.pdf
2 years ago
2 years ago Link To Comment
You need to tone down your purple prose in the “link”. There is a point to be made in the fields you are working, but it is lost in the over the top language that tends towards easy dismissal by those on the fence.
2 years ago
2 years ago Link To Comment
Is this the same Steve Brill who attempted in a recent book to fix the errors in education reform? If so, he is the echt moderate man, who inserts himself into all controversies and then lectures the various players as to how to fix the problem See http://clarespark.com/2011/08/31/review-steven-brills-class-warfare/. Personally, I would like to see all children and parents educated about mental and physical health, but there is no consensus on such intimate and religion-related questions.
2 years ago
2 years ago Link To Comment
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