One of my ongoing complaints in the public debate on health reform has been the over-emphasis on expanding coverage, without regard for addressing the underlying issues of cost.

Over the weekend, the New York Times ran an editorial entitled, “If Reform Fails…”.  As can be expected, given the political leanings of the NYT’s op-ed staff, it was pro reform.  However, they did, at least, include this section:

I’M JUST WORRIED ABOUT COSTS: You should be. The cost of medical care is rising far faster than wages or inflation. And despite all of the talk about reform “bending the curve,” no one is yet sure how to do that.

Many reforms that people instinctively believe should cut costs — computerization of medical records, paying doctors for quality not quantity of services, and prevention programs to promote healthy living and head off costly illnesses — cannot yet be shown to lower costs.

Pending reform legislation, specifically the Senate bill, would launch an array of pilot projects to test reforms in delivering and paying for care. It would also create a special board to accelerate the adoption of anything that seemed to work. That seems a reasonable way to go and a lot better than standing by as costs continue to spiral out of control. The Republicans’ proposals — including their call to cap malpractice awards — would make only a small dent in the problem.

That’s a fair point.  Admittedly, I’m skeptical about the efficacy of the pilot projects – it’s very tempting to suspect that they were included in the bill to pay lip-service to the concerns of cost – but at least this editorial constitutes some public discussion of the problem of underlying cost from the pro-reform camp.

I think the column also has a point in that the Republican call to cap malpractice awards would only make a small dent in the problem.

I still wish that health reform efforts focused on the structural inefficiencies of the American health care system, as well as tackling the underlying causes of medical cost inflation.  I think that the issue of uninsurance / lack of access would be significantly improved if those core problems were addressed.  However, I’ve come to accept that those problems are too big / too complicated for politicians to tackle until they are absolutely forced to.

I suppose that the benefit of the Dem’s  reform proposal is that if it passes, and if it remains intact, it will hasten the day when Americans will be forced to do that tackling.

In case you’ve been looking forward to your virtual strip searches, the TSA has announced where you can go to indulge in a bit of exhibitionism in the name of security:

AIT units are currently being set up at Boston Logan International airport, and within a week they’ll be at Chicago O’Hare International airport. You should see the rest of the airports on this list in action by this summer:
· Boston Logan International (BOS)
· Charlotte Douglas International (CLT)
· Chicago O’Hare International (ORD)
· Cincinnati/Northern Kentucky International (CVG)
· Fort Lauderdale-Hollywood International (FLL)
· Kansas City International (MCI)
· Los Angeles International (LAX)
· Mineta San José International (SJC)
· Oakland International (OAK)
· Port Columbus International (CMH)
· San Diego International (SAN)

Via tweets from @eddie_smith and @PrezMike2010 (SOA President Mike McLaughlin), I came across a blog post at Newsweek highlighting a difference between the House and Senate health reform bills which could be contributing to the unwillingness of House Dems to just vote for the Senate bill.  It’s a factor which hasn’t received much attention in the press….and it’s summarized in this chart:

The reform bill is all about cost-shifting to expand coverage.  And if there isn’t consensus within the party in power as to how to shift those costs…

Seen at Business Insurance:

President Barack Obama has signed into law a measure that extends the National Flood Insurance Program through March 28.

The NFIP extension is part of measure that temporarily extends a variety of federal programs, a bill that stalled in the Senate when Sen. Jim Bunning, R-Ky., objected to the package’s $10 billion price. The delay meant that the NFIP expired on Sunday.

I feel disappointed in myself for not having caught this news earlier, but it seems that one casualty of the Senate’s backlog may be flood insurance.

According to Insurance Journal, the NFIP is not accepting new business since an omnibus bill which includes yet another temporary reauthorization is stuck in queue with the Senate.

The IJ article can be found here: http://www.insurancejournal.com/news/national/2010/03/01/107746.htm

I noticed over on the Actuarial Outpost that TheAnonymousActuary has posted to YouTube a 10 minute tutorial on why health insurance is so expensive.

Note that the video focuses on the current components of loss cost, a much narrower focus than my ramblings about the cost of health care in general…but I do have a problem with being too unfocused sometimes.

Apparently someone at the Courant would like to see the state’s freeways re-tolled.  This editorial appeared over the weekend:

State Rep. Tony Guerrera, D- Rocky Hill, is the latest among Connecticut lawmakers to propose restoring tolls to finance the repair and maintenance of the state’s aging highway infrastructure.

We agree with Mr. Guerrera that a new revenue stream to help solve Connecticut’s woeful transportation problems is desperately needed.

We also agree with him that more money is needed to help pay for transit projects. High-speed rail, light rail, more commuter train routes, busways and the like would decrease the bedlam of congestion on highways, cut harmful emissions and give a jolt to the state’s struggling economy.

But tolling won’t be easy.

The editorial goes on to mention that one of the biggest challenges to getting tolls on state freeways is that doing so would cause the state to forego federal highway transportation funds, unless Connecticut landed the one slot remaining in a pilot project for interstate tolling.  Missouri and Virginia have been approved for two of the three spots, and Pennsylvania has been fumbling its position as leading candidate for slot number three for a few years.

I would mention, however, that the best way to improve the chances for getting that third exemption would be to make a few changes to the proposal.  Specifically:

• The feds will have an issue with having toll barriers only at the state lines.  Tolls that are less blatantly geared towards interstate travelers, either with additional tolling locations, or by tolling each and every entrance and exit, will be easier idea to sell to the feds (not to mention reducing the incentive for drivers to find shunpike alternatives to just a few individual barriers).
   
• The proposal provides for the diversion of some funding (specifically, a share of a reduced gas tax) to developing mass transit.  That is an admirable goal, but given the criticism Pennsylvania has faced in it’s application (that past and future highway money actually be spent on highways), perhaps that option shouldn’t be played up quite so much.
    
• Advocates could always highlight just how minimal a share of the transportation stimulus pork Connecticut has received.

I’ll admit that I don’t want to see my commuting costs rise any further.  However, something has to be done at the state and federal level to do a better job of getting revenue and spending in balance, and given the sensitivities of raising revenues, creative funding sources need to be found.  Tolling the freeways is a bit creative, and it has the added advantage of more directly collecting revenues from those who will most directly benefit from the expenditure of those funds.

I came across this link to a summary of the Wyden-Gregg tax simplification bill (which I touched upon briefly earlier this week), which I heard described the exemptions and credits they’re proposing.

There’s one item in that summary, towards the end, buried in a long list of other changes which kind of jumped off the page at me:

• Legalize, regulate and tax Internet gaming

“Legalize” gaming? The only type of internet gaming I’m aware is illegal is ‘net gambling, of which online poker is the most popular.

I won’t go off on a tangent about my feelings for online gambling…but that seems like a bit of an odd feature to include in a tax reform measure.

So, yesterday I listened to much of the health care summit in Blair House.   The comments I tweeted during the summit are aggregated in this post, but I thought I would share a few post-mortem thoughts.

From a naïve, idealistic point of view, you would think that getting a group of responsible leaders together to discuss and work through differences of opinion on a piece of major legislation would be a good idea.  In that same naïve, idealistic world, broadcasting the event so that citizens can see their elected officials doing their jobs, and so that there are no accusations of “secret, backroom deals” would also be a good idea.

However, in that perfect world, we would have leaders who would have the maturity to behave responsibly.  Adding the cameras and microphones only added to the temptation to speechify, rather than discuss and possibly (re)build legislation.

I will admit that it was somewhat nice to hear the politicians actually talk about their ideas and concerns, rather than seeing the debate reduced to just a sequence of sound bites. 

I did find some encouragement that on major issues, the donkeys and the elephants aren’t too far apart.  A major difference is on whether reform should happen in a comprehensive manner (let’s fix a lot of things NOW!), or in a measured, step-by-step approach (adjust, measure, adjust, measure).   I’ll admit that I would prefer the measured approach…but the measured approach only works when leaders have the discipline to push forward.  Human nature is to make a change, call it “done”, and ignore it until it is really broken again; and politicians are prime examples of human nature in that regard.

However, on many other points, the frustration I’ve felt watching the health care debate was reinforced. 

For one thing, there was too much of a tendency to succumb to the fallacy that “making health care affordable”  means “managing health insurance premiums”.  Insurance premiums are only a symptom of the problem.  “The problem” is complex; I tend to focus on the disconnect between the level of service/care expected and the willingness to either pay for it, or to modify behavior to reduce the likelihood of needing care.  We also have the structural inefficiencies – doctors driven to particular specialties due to the high cost of medical education and med mal insurance; the seeming randomness in medical billing; the tendency to treat symptoms rather than the patient; and many American’s belief that they should be seen by “real doctors” when PA’s and clinics are sufficient for ordinary needs.

For another, those of us who work with insurance (even if, like me, we aren’t specifically supporting health insurance) are really feeling the love, with all the attacks on health insurance profits.   Health insurers are businesses; they seek to provide their owners with profits commensurate to the risk they face!  That’s capitalism.  If there is “too much” profit being made, ensuring that the market behaves in a bit more free/efficient manner will take care of that.

I agree that some (many?) health insurers behave badly.  My personal pet peeve is when my family’s health insurer (obtained through my employer) makes late declinations of coverage, after potentially expensive procedures have been performed with the belief that coverage was being granted, leaving me owing the doctor or medical facility quite a bit more than what they would have been reimbursed had the insurer actually approved the care.  Thanks to the safe harbor provisions in the medical portion of ERISA, when this happens, there is no viable way to challenge the decision, other than one or two token appeals.  (The restrictions on awards that can be granted in litigation make it extremely difficult to find lawyers willing to take on such cases.)

Fixing that sort of behavior is better done through, say, improving unfair trade practice laws as they apply to insurance, rather than imposing artificial and inefficient restrictions on profit.  The former creates an incentive to modify standard operating procedures; the latter only creates incentives to play games with financial statements!

But I’m rambling off topic.

I don’t think the summit accomplished anything much, other than providing the President and Congressional donkeys political cover to force through a derivative of the Senate bill, and reinforcing the disgust that people like me have with politicians on both sides of the aisle.