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20 Days Later: Zombie Health Care

6/3/2017

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THE Republican American Health Care Act (A.H.C.A.) is the zombie of bills. Just when you think it’s been beaten down for good, it pops back up again.​

Oh, and with its older zombie friend, voodoo economics. To “save money,” the bill cuts nearly $1 trillion in taxes over the next decade — much of it for the rich — while cutting back Medicaid, the program that provides health coverage to low-income Americans. And it redistributes subsidies away from people that need them to afford insurance, like old and low-income Americans, to people that don’t.

I’ve already criticized the cruelty of repealing the Affordable Care Act, our current system, without a better option. Each incarnation of the A.H.C.A. has been worse than the last. Zombies can’t help it. It’s in their nature.

But the odd selling point of the A.H.C.A. has been that it “saves money.” This is technically true for the federal government. The last version would have reduced the deficit by $150 billion over a decade. The latest, $119 billion. (We just received the official report for this version — 20 days after passing the House. Republicans rushed it through anyway, because they smelled death aloft.)

Never mind that it does so by revoking people’s health insurance — an estimated 23 million over the next decade — but hey, if it saves a quick buck!

Besides cruel, this line of thinking is short-sighted. Yes, taking away insurance is short-sighted for obvious reasons, like people dying. But on the whole, I’m not convinced that it would save the country money either.

When people lack insurance, their health care still costs money. But it burdens the system more. For example, they rely more on emergency services that often go unpaid. Hospitals then foot the bill. The first incarnation of the A.H.C.A. was estimated to cost hospitals an extra $88 billion in unpaid care in 2019 alone.

Reliance on emergency services also means that people are waiting until the absolute latest to get care. Without insurance, they aren’t seeing their primary care physician for regular checkups or engaging in preventative care. In the long run, this adds unnecessary strain to the health care system. Treating advanced cardiovascular or periodontal disease, for example, is costlier than catching it early. And it’s much costlier than simply teaching people good nutritional habits.

So the costs snowball and snowball… And they land on Medicaid or, under the A.H.C.A, high-risk insurance pools, for which taxpayers pay. Or on hospitals and insurance companies, for which the insured pay. Either way, that’s you. And you — yes, you! — get to pay more! Call your Senator now for this unbeatable deal!

So while the A.H.C.A. might make the federal government’s deficit look a tad healthier on paper, it does nothing to improve health or health care costs.

In the end, the system still bloats, and you pay more for your care.

Because of problems like these, America pays more for health care than any other postindustrial nation. The average O.E.C.D. nation spends about 9 percent of its G.D.P. on health care each year. The United States, however, spends nearly 17. Almost double. Yet we have some of the worst health outcomes of this group, with gross inefficiency, unequal access to care, and high preventable mortality.
Health care costs vs. G.D.P.
The United States spends more on health care than any other postindustrial nation — to virtually no added benefit. These are all 35 O.E.C.D. nations. (O.E.C.D.)
If we spent the same percentage on health care as the next highest nations, Japan and Switzerland, at 11.4 percent, we would save nearly $900 billion every year. That is greater than the G.D.P. of Switzerland itself.​

If we seriously want to reduce costs, there’s one obvious solution: single-payer health care. Yes, I know, Republicans would never go for it. But humor me.

In such a system, health insurance is administered by the government, although some countries have supplemental private insurance. It works for Britain, France, Spain, Canada, Australia, and others. And it has two key advantages over the A.H.C.A. for reducing costs. First, its guarantee of universal coverage would allow more Americans to engage in regular primary and preventative care. As people became healthier over time, the system would become less expensive.

This was one of the goals of the Affordable Care Act. Its increase in coverage has, indeed, begun to improve health. But a multi-payer system will never insure everyone. Single-payer could. (By the way, most of the Affordable Care Act’s health improvements are due to Medicaid expansion, our government health insurance.)

Second, single-payer has collective bargaining. Consider medications. In the United States, the F.D.A. does not evaluate cost effectiveness when approving a drug, unlike, say, the National Health Services in Britain. Instead, individual insurance companies must negotiate costs with the pharmaceutical. Whereas one insurance company represents only a few million people, only a small fraction of whom will ever require a drug in question, the N.H.S. represents all of Britain.

All of Britain can negotiate down costs much better than a single insurance company ever could — the N.H.S. can just threaten not to approve the drug.

The power of collective bargaining shows: On average, drugs cost three times more in the United States than in Britain. And overall, Britain spends just under 10 percent of its G.D.P. on health care, compared to our 17.

Relatedly, single-payer systems can better cap prices for procedures, encourage fee-for-value reimbursement, which reduces unnecessary tests, and incentivize efficiency. These all reduce costs. This is another area that the Affordable Care Act aimed to improve; it provided grants to states to develop more efficient systems. A national single payer, with its collective power, could do it even better.

On one final note, a single-payer system would increase taxes, yes. However, you or your employer wouldn’t pay for insurance anymore. We’d just swap the costs. And since the system is more efficient, the per capita cost would be lower. So your effective income would be higher. It’s a no-brainer.

Single-payer is the greatest health care “deal” that we could get — better health outcomes at a fraction of the cost. Maybe that’s how we sell it. Someone tell Trump, who’s desperately floundering about, hungering for a “win” wherever he can find it, that we have a huge, terrific, beautiful, tremendously big league deal.

On second thought, we don’t even have to tell him. He’s said it himself about the Australian single-payer system: “We have a failing health care — I shouldn’t say this to our great gentleman and my friend from Australia [Prime Minister Malcolm Turnbull], because you have better health care than we do.”

Alright, Trump. Let’s make a deal.
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    I like health care and politics. I sometimes write about them.

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