Zeke Emanuel, Center for American Progress Give Up on Obamacare
In a new paper, Dr. Ezekiel Emanuel and colleagues associated with the Center for American Progress (President Obama’s go-to think tank) throw in the towel on Obamacare:
Given the current political gridlock, it is unlikely that the federal government will take the lead on reforms to control health care costs system-wide. States must therefore play a leadership role, with the federal government empowering and incentivizing them to act.
If those words sound familiar to you, you are not alone. The Washington Post reports this as “Democrats borrow a GOP idea on health care costs.” The idea is “Accountable Care States”. That’s not a term I’ve heard before, but we cannot expect the Center for American Progress to borrow the label as well as the idea.
The idea is that the federal government will encourage states to implement payment reforms that cut costs, and both the federal and state governments will save money. Current incentives work the other way around: the Medicaid funding formula encourages states to increase spending by more than they would without federal involvement.
Further, the proposal includes Medicare in the mix. Currently, this happens in Maryland, where Medicare pays according to a state-run all-payer program, not the federal fee schedule. Dr. Emanuel and colleagues recognize that state-level reforms cannot fully succeed without Medicare participation. Providers cannot reform their care delivery for just one payer. For reforms to be worthwhile for providers, all payers need to be able to respond to the reforms. Providers are regulated by states. So, for the largest payer to be federal introduces an inconsistency and incoherence that perverts states’ incentives to reform.
(This is one advantage that Canada has over the U.S. Although health insurance is a government monopoly, at least it is imposed by each provincial government, not the federal government. So, the single-payer is better able to respond to local conditions than if it were federal. Also, the federal government provides only a small share of the funding, via block grants.)
The examples given in the paper are too government-heavy: All-payer databases, price fixing, and mandatory “transparency.” Another weakness is that only governments will be able to share in the savings. How about a model where patients share in the savings, through a credit to a Health Savings Account (or Medicare MSA), for example? It is not clear whether the current Administration would allow a state to set up such a model.
Nevertheless, this paper is a big step forward for Dr. Emanuel and his colleagues. If they are not careful, they will soon find themselves endorsing block grants to states, or the interstate compact for health insurance!
Dr. Ezekiel Emanuel knows his time is almost up. Remember the last year of W’s Presidency, all you ever heard about was Obama, Clinton and the slew of Republicans running. Won’t it be nice when people are not talking about Obama?
This is a great time to go bi-partisan then Whack the Republicans in the coming debates over Obamacare. These Republicans say they want repeal and it’s not going to happen. The only thing that they can do is reform. I saw Zeke on TV the other day and he was saying employer-based insurance was dead. Zeke predicted 80% loss in employer plans in 10 years. Then they switched to Capitol IQ’s prediction of 90% loss by 2020.
I don’t trust Zeke. I think he is just thinking about these November 4th elections and he has some plan up his sleeve.
I like the idea of the tax-free MSA starting in Medicare with a new option of the tax-free HSA like you suggested. After-all, a few choices never hurt anyone.
John–It is really rare when a prophet, such as Ezekiel, recants in public. He was so naive about the government’s ability to perform it was as though that was never going to be an issue, whereas those of us who live with government regulations, know that government can conceptualize but cannot DO.
Wouldn’t you like to see some more spectacular mea culpa? When are we going to hear from Don Berwick?
Wanda J.
Now, what will Paul K and Ewe R have to say?
Or Kathleen Sebelius?
This is about global budgets and giving a central authority the power to control the absolute amount of health care spending and to decide who gets what. Dr. Emanuel is simply saying that he doesn’t think Obamacare will get it done at the federal level thanks to the dogged political resistance. So, he and those who believe what he believes will change their strategy in order to get the power that they want.
Whether it is imposed at a state or the federal level centralized control of health expenditure is a bad, bad, idea that will expand suffering and death as it has in the Canadian provinces and every other centrally run, politically controlled, health care system. Anyone remember the VA scandal that’s been going on for over a decade and serves to get the VA a bigger budget every time?
They are refocusing on the states because people at the state level are often easier to convince or bribe, as we saw with the initial development of Obamacare rules beginning in Kentucky and Tennessee in the early 1990s.
Massachusetts has global budgeting. Vermont has single payer, Connecticut passed SustiNet in 2009. Colorado and a bunch of other states have commissions to study “cost drivers” and tell state legislatures how to spend health money to minimize state expenditures. The aim is to go the way of Vermont, Connecticut, and Massachusetts.
It’s simply the equivalent of morphing global warming into climate change. The aim is the same, but when the resistance is high it is best to alter the message to confuse the resistance.
I dunno. Even during the Bush Administration, state legislatures were starting to resist. Utah, I recall, rejected federal funds for No Child Left Behind.
Today, we have state rejecting federal funds for Medicaid expansion, signing the Health Care Compact, rejecting Obamcare exchanges, signing Right To Try (experimental medicines) laws.
Some single-payer critics think that Vermont going single payer will be and effective warning to the rest of the country.
One of the numerous muddled ideas in Emmanuel-world is that government health spending on health care is increasing because of “health care costs.”
First of all, health care is not one product like oil or wheat or paper clips, which have a ‘cost’ that does go up and down.
Health care is more like an enormous Sears catalog of procedures, drugs, etc.
The spending totals in any health insurance plan are driven by:
a. the number of people covered
and
b. the number of procedures,drugs, etc which are paid for.
If the government truly had to cut back its health care spending, it could do so tomorrow morning. The daily hospital rate for intensive care could be lowered to $1000 vs about $5000. Dialysis could be denied to anyone over 75. Medicaid could stop paying for nursing homes. No drug costing over $500 could be purchased with government funds.
I am not saying that these draconian steps should be done.
But they could be done, regardless of what happens to this amorphous “health care costs’ that will always be elusive.
The Affordable Care Act (at least for many politicians) was mostly a political solution looking for a public policy problem. There were likely only a true believers who thought it a practical solution to a real problem.
When perverse incentives causes it inevitably fail, the public will clamor for yet another fix. Many progressives hoped the ACA would only a first step on the road to Single-payer. Yet, the public would never have backed such a radical move.
Linda, I do not mind your loading up against centralized health care budgets, but one of your phrases seems a little over the top…….
“expand suffering and death as in the Canadian provinces…..”
#1 – I do not know of any spikes in mortality in any part of Canada since they established universal Medicare.
#2 – there are cases of suffering in Canada due to waiting lists. Whether this has grown worse since their Medicare, I do not know, it would take a pretty serious study. I do not think that Canada had perfect health care before 1965, as your phrase would imply.
However, there are virtually no cases in Canada of anguish over hospital bills, as happens every day in the USA.
There may be a tradeoff here, but it is not simple.
#3 – Some of the ‘cost drivers’ in American medicine are staring us right in the face, like the prices for cancer drugs and now for Sovaldi and hepatitis.
We do not need elaborate fed-state commissions to deal with these. We just need the same kind of pharmaceutical price review boards as exist in almost all other countries.
We have dealt with Canadians’ financial distress due to health spending at this blog (http://tinyurl.com/lftzr2q).
The waiting lists are measured every year by Fraser Institute. They did not start measuring in the 1960s. Many of the procedures for which Canadians wait today are very different than they were in those days. Some did not exist.
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