Candace

Talmadge

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December 19, 2008

Why Mess With ‘Hybrid’ Health Reform When Single-Payer Is the Way to Go?

The looming battle over health care reform apparently will focus on a public component modeled after Medicare.

Call it Medicare for a lot of people with a politically mandated nod to the private sector.

Expect most Republican members of Congress to fight it tooth-and-nail, but don’t fall for their hypocrisy. Don’t believe doctors or hospitals, either, when they complain about presumed Medicare underpayment. That’s a bunch of baloney, according to U.S. Rep. Pete Stark, D-Calif., who chairs the House Ways and Means Health Subcommittee and has heard it all for decades.

Way back in 2003, when the Bush Administration trumpeted so-called Medicare reform, Republicans argued that Medicare, a public (tax-dollar financed) health care plan for those aged 65 and older, should have to compete with the private sector. They won, and the result is Medicare Part D, also known as Medicare Advantage.

(As currently enacted, however, Medicare Part D costs a lot more than necessary. The GOP inserted a provision in the law forbidding Medicare officials from negotiating lower prescription drug prices. That little sop to big pharma campaign contributors has to go if we are serious about cutting health care costs.)

Democrats are now calling Republicans on their rationale and raising the ante, offering an inverse argument – private health care insurers covering Americans younger than 65 also should have to compete with a public plan. Said plan would be managed by the federal government (like Medicare) and pay private providers, such as physicians and hospitals, to provide actual health care.

The label du jour is hybrid. Democrats are pushing a hybrid system of public-private health care for Americans younger than 65 as the essence of health care reform.

Evidence in favor of hybrid funding includes superior cost containment and better health care quality, according to Jacob S. Hacker, professor of political science at UC Berkeley. Hacker discusses this evidence in a recently published report co-sponsored by the Institute for America’s Future and UC Berkeley Law School’s Center for Health, Economic and Family Security, of which Hacker is a co-director.

Between 1997 and 2006, for example, health spending per person enrolled grew 7.3 percent per year under private plans, compared with a 4.6 percent annual hike under Medicare. In administrative overhead, Medicare’s costs are around 3 percent of premiums. This compares very favorably to 5 to 10 percent of premiums for self-insured large businesses; 25 to 27 percent of premiums for companies in the small group market; and a whopping 40 percent of premiums in the individual insurance market.

Speaking of quality, the public system for veterans, the Veterans Health Administration, has developed an evidence-based quality improvement program. More than two-thirds of those in the VHA system receive the appropriate standard of care (based on the program), while only about half of adults and children covered by private insurance receive the same standard of care.

Medicare quality benchmarks, in fact, are frequently adopted by private carriers when evaluating how and what kind of health care to pay for. And unlike private insurers, which move in and out of markets and often change the terms of what they do and don’t cover, Medicare affords greater coverage stability, leading to more consistent care for its enrollees.

It’s clear that a public plan can contribute to improving health care in this country while lowering costs. What’s not so obvious is why we need (or want) to keep involving the private sector in health care funding. It’s just not getting the job done and the tab is outrageous.

Could we not just skip all this hybrid hoopla and go directly to single-payer health care funding? Of course not. How silly even to suggest it. That would be much too cost-efficient and time-saving, not to mention threatening to many well-heeled and vociferous special interests.

So we shall spend time and money we really don’t have demonstrating yet again that the public approach is the way to go.

© 2008 North Star Writers Group. May not be republished without permission.

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