The Bush Health Plan and other “Market-based Plans”
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"One of the goals of this policy is really to rationalize our health care spending so that we're getting higher value, more efficient care, and we hope in the long run that that substantially brings down the trajectory of growth in national health spending, because [people will] be allocating their health care dollars more efficiently," -Katherine Baicker, Council of Economic Advisers
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The Bush Plan and all other "Market-Based Plans" exist to get Americans involved as "informed health care consumers". In order for health care to be a "normal market good" that can be "comparison shopped" and made more "efficient" by the invisible hand of the free market means all the consumers are equally informed about the quality and necessity of various medical procedures and medicines. Remember, as the old saying goes, the consumer should have “skin in the game”…and it really applies when real skin is involved!
Purchasing health care is like buying a television, you don’t really have to understand how it works, to do it, but unlike buying a television, the consequences of getting a “bad one” may be death or permanent disability. But still, it’s a “normal market good”, isn’t it?
A good comparison shopper is an informed comparison shopper. If the doctor insists on you getting a triple-bypass, surely there’s a way to cut some costs on things. How much anesthesia do you really need, after all. And when you’re in the emergency room after a grisly lawn-mower accident, you can always haggle about how many stitches are absolutely necessary. Remember, every penny counts.
But first, let's take a look at the American Consumer. The American health care consumer is going to be intimately familiar with medical procedures. How hard can it be to do that "doctorin'" stuff? Well, it usually only takes 8 years of college followed by a 3 year residency, so anyone with 11 years to spare can get an MD. So it can't be TOO hard can it? Remember, in order to be the best comparison shopper you can be you need to be fully aware of all the details about the medical field.
But what do we know about America's health "shopping" habits? Well, according to the National Center for Homeopathy, 7.3 Million American have tried homeopathy. Last year American’s Spent $425 Million on Homeopathic Remedies! And in the last decade the relative number of American who have used homeopathy has increased 500%. All this despite the fact that The National Center for Homeopathy itself says: “Homeopaths acknowledge that most remedies are so diluted that laboratory tests cannot locate a single molecule of the original substance.”
And the National Center Against Health Fraud had this to say about Homeopathy: "The marketing of homeopathic products and services fits the definition of quackery established by a United States House of Representatives committee which investigated the problem (i.e., the promotion of ‘medical schemes or remedies known to be false, or which are unproven, for a profit’).”
The American health care consumer is also going to have to be generally technically savvy as well! Positron emission tomography scans, functional MRI’s, nuclear medicine, it's going to require a highly skilled, highly technically educated consumer to drive this market-plan forward. If health care is a "normal market good" then Americans will be able to step up to the plate and choose the best care for the least price! But who are these technically savvy consumers"?
Well, according to a 2005 Harris Poll: 25% of Americans believe in astrology (better hope you were born under a “healthy sign”), and about 28% of Americans believe in witches. So if you find that the so-called doctors in your town haven’t found the cure for your disease, perhaps the person selling eye-of-newt will be better able to serve. But finally a whopping 73% of Americans believe in miracles. Which is good if you want to survive a market-based healthcare plan.
But the other half of the Bush plan involves number-crunching and tax incentives. All Americans are expert at tax arcana, right? We all have to do it every year, so we must be good at it! That’s probably why about 60% of Americans have a tax preparer do their taxes for them.
The U.S. Tax Code is 17,000 pages long and since 1986 Congress has made 15,000 changes to it, so it’s probably pretty easy to keep up with it all. According to a U.S. Census report, in 2005 only 35% of Americans read a book for leisure. Maybe all the rest were reading the Tax Code.
Under the current Bush proposal the White House estimates that only about 20% of Americans currently getting health care coverage through work will see an increase in taxes because their plans will exceed the $15,000 family/$7,500 single “caps”, and while these caps will be adjusted for inflation, health care costs rise a lot faster! A preliminary analysis by the Tax Policy Center suggests that within 10 years of the Bush Plan’s implementation, 40% of all plans will exceed the cap, et viola, 40% of people covered under employer-purchased plans will get to pay more in taxes.
So overall we have a populace that is going to have to get out there and get do the heavy lifting and make this market plan work. Convoluted tax breaks coupled with extremely advanced technology and a complex discipline such as medicine all in the hands of regular people like you and me who believe in witches and pay other people to compute our taxes for us.
Yeah, this is gonna work out real well.
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