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Generic Confusion

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Friday, June 05, 2009

The first step to fix health care

Virginia Postrel makes a sensible suggestion, similar to something I've long thought.

"Nearly 30 percent of Medicare’s costs could be saved without adverse health consequences."

The report also suggests that we know what the problems are, listing the usual suspects:

We spend a substantial amount on high cost, low-value treatments.
Patients obtain too little of certain types of care that are effective and of high value.

Patients frequently do not receive care in the most cost-effective setting.

There is extensive variation in the quality of care provided to patients.

There are many preventable medical errors that lead to worse outcomes and higher costs.

Our system is complex and we have high administrative costs.

Think about this for a moment. Medicare is a huge, single-payer, government-run program. It ought to provide the perfect environment for experimentation. If more-efficient government management can slash health-care costs by addressing all these problems, why not start with Medicare? Let's see what "better management" looks like applied to Medicare before we roll it out to the rest of the country.

This is not a completely cynical suggestion. Medicare is, for instance, a logical place to start to design better electronic records systems and the incentives to use them. But you do have to wonder why a report that claims that Medicare is wasting 30 percent of its spending thinks it's making a case for making the rest of the health care system more like Medicare.

Many massive government programs are sold in this manner. For example, in the Medicare prescription drug coverage debate, you might remember a suggestion that giving someone a drug now would prevent an expensive surgery later. That is certainly true in some cases, but if you give 50 million people $1000 in drugs and prevent 1000 surgeries costing $100,000, is that really sensible?

So, before we turn over health care to the same group that ruins health care for our veterans, let's implement the many suggestions for making health care more efficient and which will decrease medical errors. Let's compare the savings we observe over, say, three years, to government predictions of savings. If they're off by more than 20%, this current administration should shelve its goals, because they will have been demonstrated to have failed.

(I recognize that these savings may be hard to measure. But even so, these successes should be obvious enough to sell the Democrats' vision. However, that will only apply if the successes are real.)

As an addition to this debate, please read this article by Postrel, and how she's glad to have lived in the American health care system, over a particular state-controlled system.



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