Let’s Be Sure that We Are Solving the Right Problem

The Republicans are Solving the Wrong Problem

Health care costs continue to rise, and as they do, the problem of providing health care for every American becomes more and more difficult. Most Americans believe that health care is a right and that every American should be able to receive adequate care, but if we do not control its cost, we will soon be unable to afford to do what we know that we should do.

The Republicans in Congress mistakenly focus on controlling federal health care spending instead of focusing on the problem of controlling the cost of health care as a whole. They propose to solve the federal spending problem by shifting the cost of health care from the government to the people.  They propose to achieve that by turning Medicare into a voucher program.  The idea is that each Medicare recipient will receive a voucher to use to purchase health insurance in the private market. Thus, the federal obligation will be fixed at the cost of the vouchers.

Focusing only on Federal Spending Will Make Health Insurance Unaffordable for Everyone

This solution to the federal spending problem will work only if the dollar amount of the vouchers does not rise with the cost of healthcare, but of course, the cost of healthcare will rise, and as it does, most of us will become unable to afford health insurance. That is happening already to people who buy individual insurance through the exchanges, and it is only a matter of time before it happens to those who get their health insurance through their jobs.

We Can Reduce the Cost of Health Care

In order provide health care to every American, we have to address the problem of controlling the cost of health care itself. We have to understand the causes of the high cost of American health care, and we have to address those causes directly.  In an earlier post on this blog, I wrote about the causes of the high cost of health care in detail, and I will not repeat that discussion here. To deal with those causes, there are several things that we can do:

1. We can change the way we compensate health care providers to encourage them to reduce costs. The current fee-for-service system encourages them to maximize costs by providing expensive and unnecessary services. This is key. We cannot reduce the cost of health care unless we change the incentives of the health care providers.
2. We can bargain with the drug companies to reduce the cost of medications.
3. We can insist that each service and product have a standard price, and we can make information on prices available to doctors and patients to use in deciding what diagnostic tools or treatments to choose.
4. We can increase our support for primary care to encourage patients and health care providers to maximize its use.  Primary care is cheap, and if people care for themselves when they are not yet so sick that they need to be hospitalized, we will save money because emergency care and hospital care are much more expensive than primary care.
5. We can increase our support for health education and provide incentives for people to choose healthy lifestyles because that will reduce the need for expensive management of chronic conditions like diabetes, obesity and coronary disease. 

These are not complicated ideas, and there are several ways that they can be implemented. All of them have been tried in other countries and in some places in the United States.

If we reduce the cost of health care, we will also reduce its drain on the federal budget, and we will do so without making health insurance unaffordable for most Americans. So, let’s make sure that we solve the right problem – the cost of health care – rather than focusing narrowly on federal spending. If we do so, we will be able to afford health care for every American.