06.05.09
Health care: Sound bites over economics
Indeed health care costs are over the top, and better efficiency is needed in the sector as well as properly aligned incentives. An op ed by former Lt. Gov of NY Betsy McCaughey in today’s WSJ spoke rationale that has been lacking in the debate. She accurately points out the fallacy of the Obama admins logic: that the only way to slow Medicare spending is to slow overall health care system spending thru comprehensive reform and legislation, carefully crafted of course. Medicare is fiscally unsound because of a lack of properly aligned incentives including distortions that increase supply and procedures, increasing numbers of beneficiaries, and the lack of updating needed to reflect demographic changes and levels of wealth appropriate for the times.
She points to the CBO suggesting wealthy seniors pay more and inching up eligibility ages similar to how social security has done. I have suggested this in my white paper; it’s really a no-brainer. Until we have greater transparency, policies which drive sustainability, and economic reality-based payments and benefits in Medicare, the administration’s PR team can fool many of the people much of the time as they try to expand coverage. The goals of squeezing HC costs and Medicare, and expanding access are two separate issues with their own differing sets of dynamics. Painting a broad brush stroke over the immensely complex health care system is futile.
