| | | Zeke Emanuel, Center for American Progress Give Up on Obamacare
By John R. Graham Filed under Health Care Costs on September 5, 2014 with Leave a Comment
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!
- See more at: healthblog.ncpa.org |
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