THE PLANK JULY 2, 2008
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Ezra Klein has a nice web piece over at the American Prospect summarizing what we know about the success of Massachusetts's universal health care scheme. The gist of it is this: It's been quite successful in reducing the ranks of the uninsured, which have been roughly cut in half (results are even better for those with incomes below 300 percent of the poverty line). There are two main drawbacks: One, while it's still early, compliance with the individual mandate hasn't been universal, and two, it's been somewhat more expensive than supporters envisioned--but only because the state had more uninsured residents than it previously realized.
Neither of these problems is very worrisome, though. On the cost front, as Ezra notes, the plan was aimed solely at expanding access, not controlling costs. If the state decides that the current plan is unaffordable absent some form of cost control (which could risk a reduction in the quality of care), that's a tradeoff it can confront in due time. Access should come first: I think most Americans would agree with Jon Cohn, not Michael Cannon, that denying coverage to the poor and sick isn't an acceptable means of cost control.
Second, at least in my opinion, it doesn't really matter that much whether the Massachusetts plan is literally universal in the sense that everyone has health insurance--the important thing is that everyone be in a financial position to reasonably afford insurance, which is now more or less the case in Massachusetts. The remaining uninsured are people who could buy insurance, but choose not to. This could become a problem from a risk-pooling standpoint if huge numbers of affluent and healthy people start deciding not to buy insurance, driving up premiums (the scenario that an individual mandate is meant to prevent), but so far it doesn't look like a major concern.
The bottom line is that the Massachusetts experiment has mostly succeeded--which is probably why, according to the polls Ezra cites, more than two-thirds of Bay Staters approve of it.
--Josh Patashnik
9 comments
In a somewhat related item Ezra Klein's latest post starts:
-- Since this is already getting coverage throughout the liberal blogosphere, I guess I should say it's true that internet blog person and real life friend Brian Beutler was mugged and shot three times last night while walking home.
The relationship to universal health care is made clear by Spencer Ackerman's blog on the same incident:
-- He's also going to be a man with some serious hospital bills. Plans are in motion for Kriston's band Gestures, my band The Surge, and some other friends' bands to play a benefit concert in D.C. to raise money for Brian in the near future. I'll be posting notices here as soon as things firm up. If you can attend, please do, and if you can't but can donate money, please do that instead. I'm going to set up a PayPal account for Brian as soon as I figure out how. What a great thing it would be if we could come together as a community to support each other when disaster hits.
attackerman.firedoglake.com/.../brianbeutlerisinvincible
- ndmackenzie
July 2, 2008 at 11:17pm
I remember reading a Nytimes article (sorry can't find the link) a few months back about the Massachusetts's system being too successful. Esssentially all the newly covered people went out to find primary care doctors and the massive expansion had pretty much overwhelmed the system leading the new enrollees to be placed on waiting lists. As much as a support expanding coverage for all, it seems to be a problem that needs to be addressed, and the fact that fewer and fewer of med school graduates are choosing specialties over GP or Peds as many current GPs retire isn't promising either.
- wroth2
July 3, 2008 at 12:51am
Now a word about UnitedHealth Group's story of failure.
Another chapter closed yesterday on the largest healthcare scandal in our history, as UnitedHealth, based in Minnesota, announced a $900 million settlement in its class-action suit and the laying off over more than 4,000 employees. No national coverage. UnitedHealth is the largest healthcare company in the world.
The media was busy covering the media: Much more coverage was given the 125 layoffs at the LA Times.
The UnitedHealth story is a stellar example of Crony Capitaliism at its best (or worst). Involved are Clinton cronies like Jim Johnson and Donna Shalala, and ousted Republican CEO Bill McGuire.
That's the same Jim Johnson that Barack Obama discovered was a bit too radioactive.
It was all about the back-dating of stock options, making all of the insiders rich. This time they got caught.
- fougasseu
July 3, 2008 at 7:03am
Thanks fougasseu! Gonna have to go look that one up.
- GSpinks
July 3, 2008 at 8:56am
From Michael Cannon: "That is the Left’s approach to cost-containment — give more health benefits to more people with more ailments, while making everyone pay less — and it is just plain goofy." Of course Cannon doesn't allow any replies since he simply ignores the fact that the greater the preventative care, treating illness early, the less the cost is down the line, so of course more benefits to more people results in a better outcome for society, not just in health care costs but gains in productivity from sick days not lost.
The only goof is Michael Cannon.
- blackton
July 3, 2008 at 10:37am
If we don't control costs, we won't assure access, certainly not in the long run. We spend twice per person on health care as other industrialized nations (and have lousy outcomes and leave many of us vulnerable to financial ruin). The main reason is our insistence on the mixture of 1,500 public and private insurers - too much waste and lack of long term focus on preventive and primary care that is inherent in a system that members move in and out of. One risk pool for us all, single-payer financing is the way to insure access for us all and containment of cost.
- bsemple
July 3, 2008 at 11:37am
Actually, blackton, the effectiveness of preventive care in controlling costs isn't as clear cut as it might initially seem. Ezra Klein had a good post about this a few months ago www.prospect.org/.../ezraklein_archive
Also see the article by David Brown that Ezra links to.
For an individual person, the costs of preventing an illness are usually much lower than the costs of treating it, but preventive care involves treating everybody in an at-risk population, a large proportion of whom would have been fine without the preventive care, so the overall costs may not be much lower.
Mathematically, the total cost without preventive care = TNF
where T is the cost of treatment per person, N is the size of the at-risk population, and F is the fraction of that population that will get the disease.
The total cost with preventive care = PN + TN(F-Q)
where P is the per-person cost of preventive care, and Q is the degree by which preventive care reduces the risk of the disease (i.e. the proportion of the at-risk population whose illness would be prevented by the preventive care).
A little bit of algebra shows that the difference in cost with preventive care is PN - TNQ. Obviously this depends a lot on the particulars of the relative costs of prevention and treatment, and the effectiveness of prevention, all of which vary from one illness to another.
This isn't to say that prevention is a bad idea. There are lots of benefits other than controlling costs, but it may not be as cost-effective as you'd think.
- AlanSP
July 3, 2008 at 1:27pm
Alan thanks, I am not a statistician, but you did kind of ignore the second half of the equation which is lost hours of productivity. People who die early, say from prostate cancer, generally die in their most productive earning period. While the cost of their treatment might be the same as millions of men not getting prostate exams, their early deaths aren't factored in your equation.
- blackton
July 3, 2008 at 6:04pm
blackton, I was thinking of that under the umbrella of "benefits other than controlling costs." Economically, of course, lost production is a very real cost, but my impression is that that usually isn't really what people are talking about with they refer to controlling health care costs. If you consider the statistics that people tend to cite (amount we spend on health care, etc.), it certainly seems that way.
- AlanSP
July 3, 2008 at 7:20pm