Welfare for the Medical-Industrial Complex
Stephen Brill’s long piece about medical costs has brought forth a mixture of praise and annoyance from health-care economics experts, including Aaron Carroll and Uwe Reinhardt;
they’ve been screaming for years that our medical system charges too
much, and so they’re both gratified and annoyed to see a major-media
piece confirming what they’ve been saying all along.
Weirdly, though, Brill sniffs at one thing that we know works to keep prices down: single-payer systems that can say no. There’s a reason single-payer systems are pretty much universally much cheaper than systems — even the Swiss system — that run things through private insurers. And it’s not just the administrative costs.
Note that Medicaid, in particular, which is able to say no in ways Medicare can’t, is substantially cheaper than both Medicare and, even more so, private insurance.
So why does Obamacare run through the private sector? Raw political necessity: this was the only way that it could get past the insurance industry’s power. OK, that was how it had to be.
But you should really be outraged at the efforts of some states to ensure that the Medicaid expansion is done not via direct government insurance but run through the insurance industry. What you need to understand is that this is a double giveaway, both to the insurers and to the health care industry, because private insurers don’t have the government’s bargaining power. It is, bluntly, purely a matter of corporate welfare for the medical-industrial complex.
Oh, I guess you might believe that the relevant politicians sincerely believe that the magic of the market will somehow lower costs, despite overwhelming evidence to the contrary — and that rewarding their friends has nothing to do with it. Hey, I have this bridge to sell you.
Still, isn’t it bizarre that governors who protest bitterly about the cost of Obamacare, and in general about wasting taxpayers’ money, are willing to throw away lots of money via corporate welfare? Actually, no; it’s only puzzling if you think they believe anything they say.
Like Aaron, I’d say that outrage over the duplicity here is not sufficient reason to block the states’ moves; unfortunately, the uninsured are at stake, and they need help. But we’re seeing an object lesson in what our political divide is really about."
Weirdly, though, Brill sniffs at one thing that we know works to keep prices down: single-payer systems that can say no. There’s a reason single-payer systems are pretty much universally much cheaper than systems — even the Swiss system — that run things through private insurers. And it’s not just the administrative costs.
Note that Medicaid, in particular, which is able to say no in ways Medicare can’t, is substantially cheaper than both Medicare and, even more so, private insurance.
So why does Obamacare run through the private sector? Raw political necessity: this was the only way that it could get past the insurance industry’s power. OK, that was how it had to be.
But you should really be outraged at the efforts of some states to ensure that the Medicaid expansion is done not via direct government insurance but run through the insurance industry. What you need to understand is that this is a double giveaway, both to the insurers and to the health care industry, because private insurers don’t have the government’s bargaining power. It is, bluntly, purely a matter of corporate welfare for the medical-industrial complex.
Oh, I guess you might believe that the relevant politicians sincerely believe that the magic of the market will somehow lower costs, despite overwhelming evidence to the contrary — and that rewarding their friends has nothing to do with it. Hey, I have this bridge to sell you.
Still, isn’t it bizarre that governors who protest bitterly about the cost of Obamacare, and in general about wasting taxpayers’ money, are willing to throw away lots of money via corporate welfare? Actually, no; it’s only puzzling if you think they believe anything they say.
Like Aaron, I’d say that outrage over the duplicity here is not sufficient reason to block the states’ moves; unfortunately, the uninsured are at stake, and they need help. But we’re seeing an object lesson in what our political divide is really about."
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