Tag: Democrat health care plan

Conservatives, Tea Partisans Still Really, Really Angry about ObamaCare

Or at least, that’s what The Daily Caller says a Republican pollster says:

A year may have passed since Obamacare passed, but conservatives are still angry as hell about it.

Expect the legislation to play a large role in the 2012 elections, according to John McLaughlin, who recently conducted a series of focus groups for the research group Resurgent Republic. The group is run by some of the country’s best-known Republicans.

“My guess it it’s going to be a big election issue next year,” McLaughlin said in an interview…

When it comes to President Obama’s health care law among these voters, the perception of these voters has hardly changed: the intensity remains strong and they still want it repealed, McLaughlin said.

ObamaCare’s overall numbers don’t look any better, either.

Dartmouth Withstands the NYT, but the Left Cannot Withstand Dartmouth

Research by scholars at Dartmouth Medical School suggests that Americans waste gobs of money on medical care.  Last week, The New York Times ran a fairly lame critique of the Dartmouth research, by Reed Abelson and Gardiner Harris.  Kate Steadman of Kaiser Health News provides a good synopsis of expert reaction to the story and writes, “Conservative and libertarian health policy bloggers were largely silent, ignoring the debate.”  Although this libertarian wasn’t exactly ignoring the debate, the categorization is largely fair.  More about that in a moment.

Abelson and Harris’s portrayal of the Dartmouth research is completely at odds with my understanding of that research.

Decades ago, Dartmouth researchers stumbled across what may be the best method of detecting wasteful spending in an economic sector as complicated as medicine.  They noticed that patients in some areas consume a lot more medical care than patients in other areas — more office visits (to specialists in particular), more diagnostic tests, more procedures, more hospitalizations, et cetera.  And they began to question whether the patients who consume more care actually benefit from that additional care.  They have therefore spent the past few decades measuring both geographic variation in medical consumption, as well as any benefits for which they can find data.  Do patients in high-spending areas start out sicker than patients in low-spending areas? Do they end up healthier?  Are they more satisfied with their care?  My sense is that the Dartmouth researchers are scientists trying to capture the empirical reality of America’s health care sector.  They have been doing this for a long time, they are very good at it, and they consistently find that a lot of the medical care that Medicare patients consume appears to provide no value.

That finding has drawn intense criticism, not least from health care providers in high-spending areas, whose resource use it calls into question.  Dartmouth researchers have tried to address those criticisms by approaching the issue from whatever angles the data will allow.

  • It is possible, and many critics claim, that high-spending regions spend more because they treat sicker patients.  The Dartmouth folks have therefore controlled for patients’ health status, then measured whether patients in high-spending areas experienced better outcomes.
  • It is certain, as critics also note, that those controls are imperfect.  Dartmouth researchers have therefore controlled for the ultimate outcome — death — by measuring geographic variation in Medicare enrollees’ medical consumption in the last six months of life.  That too is an imperfect strategy, as Reed and Harris note.  It is possible that high-spending regions are doing things that keep some Medicare patients alive and out of that cohort.
  • Dartmouth researchers have compared variations in spending to measures of quality other than health outcomes, including “process” measures that show whether doctors are following evidence-based treatment guidelines.
  • To determine whether patient preferences are driving geographic variation, they have compared consumption patterns to surveys estimating patients’ preferences for more- vs. less-aggressive treatment.

These various strategies consistently show that a large share of medical spending cannot be explained by either patient preferences or better health outcomes.  Indeed, they have even found that higher spending often correlates to lower-quality care.  These findings suggest that perhaps one-third of U.S. health care spending — which amounts to about $700 billion per year, or 5 percent of U.S. GDP — is not making patients any healthier or happier.

These research strategies are not perfect, either individually or in the aggregate, because the data are imperfect and medicine is extraordinarily complex.  (If this stuff could be measured perfectly, it wouldn’t be medicine.)  Furthermore, even if the Dartmouth studies fully controlled for health status and patient preferences, their findings would not prove that all the extra money is being wasted. It may be, for example, that the additional money spent in high-spending areas generates new knowledge that helps save lives  in low-spending areas too.

Nevertheless, this central finding has held up to many different research strategies.  The Dartmouth crowd has produced a sizable and credible body of research that suggests as much as one third of U.S. health care spending — roughly the annual economic output of South Carolina — is little more than a wealth transfer from taxpayers and premium-payers to health care providers and medical suppliers.

Given all this, it was bizarre to see Abelson and Harris claim, “Measures of the quality of care are not part of the formula” (which is untrue), and “Neither patients’ health nor differences in prices are fully considered by the Dartmouth Atlas” (the presence of “fully” makes this claim merely unfair and misleading).  I agree with my left-leaning friends.  This was shoddy journalism.

I have seen only one conservative comment on the Abelson-Harris story.  Since OMB director Peter Orszag invokes the Dartmouth data in his argument for ObamaCare, my conservative friend celebrated Abelson and Harris’s attack on those data.

My conservative friend is in error — but so is Orszag.  As I wrote above, the Dartmouth folks are merely trying to capture what is happening in the world that surrounds us.  So long as the Dartmouth research holds up to scrutiny, advocates of free-market health care reform should embrace it, for two reasons. First, embracing reality is generally a good idea.  Second, the Dartmouth research makes the case for free-market reforms, and against the Obama-Orszag agenda.  The Dartmouth Atlas focuses almost exclusively on the Medicare program, where economists of all stripes acknowledge that government-imposed price and exchange controls, coupled with a lack of patient cost-consciousness, are the driving forces behind persistent excessive spending and a lack of focus on value. (Dartmouth researchers opaquely refer to Medicare’s fee-for-service price and exchange controls as “the current reimbursement system.”) These are not products of the free market.  The wasteful health care spending identified by Dartmouth researchers must be laid squarely at the feet of the Left — or as I affectionately call them, the Church of Universal Coverage.

My conservative friend(s) would do better to respond that a free market can reduce unwarranted variation in health care spending, while government can’t — not in Medicare, and not even in the Veterans Health Administration.

Constitution Offers No Haven to ObamaCare’s Individual Mandate

With multiple lawsuits challenging the constitutionality of ObamaCare’s “individual mandate,” the law’s backers have proffered two principal arguments in its defense.  First, they claim that Congress has the power to require U.S. residents to purchase health insurance under the Constitution’s grant of power “to regulate Commerce…among the several States.”  Second, they claim the measure is authorized by the taxing power.

Regarding the commerce power, Cato senior fellow Randy Barnett explains in yesterday’s Wall Street Journal:

[T]he Court has never upheld a requirement that individuals who are doing nothing must engage in economic activity by entering into a contractual relationship with a private company. Such a claim of power is literally unprecedented.

Barnett also explains that the text of the law precludes ObamaCare’s defenders from claiming that the individual mandate is authorized by the taxing power.  The individual mandate defines a minimum level of coverage and then imposes a penalty on people who do not purchase such coverage.  Barnett notes that the law invokes the commerce power (not the taxing power) to justify the mandate, and refers to the penalty for non-compliance as a “penalty” (not a tax):

In short, the “penalty” is explicitly justified as a penalty to enforce a regulation of economic activity and not as a tax. There is no authority for the Court to recharacterize a regulation as a tax when doing so is contrary to the express and actual regulatory purpose of Congress.

At National Review Online, Cato chairman Bob Levy explains, “even if the penalty for noncompliance is deemed to be a tax rather than a fine, it does not meet the constitutional requirements for income, excise, or direct taxes,” and would be an unconstitutional tax.

That leaves ObamaCare’s supporters to defend the individual mandate as an (unprecedented) use of the commerce power.  Barnett writes:

Are there now five justices willing to expand the commerce and tax powers of Congress where they have never gone before? Will the Court empower Congress to mandate any activity on the theory that a “decision” not to act somehow affects interstate commerce? Will the Court accept that Congress has the power to mandate any activity so long as it is included in the Internal Revenue Code and the IRS does the enforcing?

Yes, the smart money is always on the Court upholding an act of Congress. But given the hand Congress is now holding, I would not bet the farm.

Levy concludes, “Legal refinements aside, the insurance mandate is an affront to personal liberty that will exacerbate our health-care problems. For those who care, it’s unconstitutional as well.”

ObamaCare Is RomneyCare 2.0

Former Massachusetts governor and possible 2012 presidential contender Mitt Romney has spent a lot of time campaigning against the recent health care overhaul.

One problem: It looks a lot like the law he signed in 2006 while he was governor of Massachusetts.

“In every important respect the Obama plan and the Romney plan are identical,” says Michael Cannon, Cato director of health policy studies.

In a new video, Cato’s David Boaz and Michael Cannon explain how alike the two plans really are. Watch:

Cato scholars have been critical of Romney’s health care plan since its inception.  In June 2006, Michael Tanner authored the Cato Briefing Paper, “No Miracle in Massachusetts: Why Governor Romney’s Health Care Reform Won’t Work,” and concluded:

[T]he act goes far beyond an individual mandate to radically change the way health insurance is bought and sold in the state. Many observers see Massachusetts’s reforms as a model for the nation, but a closer look provides ample reasons to be skeptical.

…Health care needs more consumer control and freer markets, not more government regulation, controls, and subsidies. The Massachusetts reform takes us in the wrong direction.

(It was not long before Tanner’s predictions about the Massachusetts plan came true.)

Romney’s record on health care will certainly come up if he pursues further political aspirations in the next few years. As David Boaz asks, “How can he lead the charge against a health care plan that is modeled on his own? How can he go around denouncing a government takeover and an intrusion of people’s rights when he authored a very similar plan?”

Good question.

ObamaCare: “Everything That’s Wrong with the European-style Democratic Socialist State”

From Jeffrey H. Anderson, writing at National Review Online’s Critical Condition blog:

With Obamacare, President Obama has given a concrete example of everything that’s wrong with the European-style Democratic Socialist state, all wrapped up in one (massive) package. The notions are no longer abstract or theoretical. They’re here for all to see: less liberty, more taxes, more public indebtedness, more intergenerational theft, taxpayer funding for abortion, government rationing of health care, consolidation and centralization of power in Washington, and politicization of the properly private relationship between patient and doctor. The American people don’t want any of this, which is why 54 percent of Americans, including 59 percent of independents, are for repeal. Let’s give it to them.

Repeal the bill.

Could Obamacare Survive a Fiscal Crisis?

Over at Think Markets, NYU’s Mario Rizzo asks how Obamacare might be repealed. He focuses on the fiscal brawl that will occur when the Medicare cuts must be implemented. Let’s take a look at another fiscal scenario.

The Greek debt crisis is just the leading edge of a global debt crisis in developed countries. It is not Greece that matters to the rest of the European Union, but the precarious position of other highly indebted EU members: Portugal, Italy, Ireland, and Spain. Fiscally sound Germany could bail out Greece, but not all the others. A Greek default (likely if not inevitable) will fracture the EU and the contagion surely would spread to the United States.

The result will be what I call a Leninist moment. Lenin famously observed that a situation must often get worse before it can get better. He had a different idea of what better would be than do libertarians, but his insight is nonetheless correct.

The resulting fiscal crisis in the United States would finally force a serious debate over fiscal discipline. Not even eliminating all defense expenditures would close the budget gap. Could Obamacare survive the crisis?

CBO: ObamaCare Would Increase Deficits by $59 Billion

Of course, it depends on what the meaning of “the Obama health plan” is.

If the Obama plan is understood not to include the $208 billion Medicare “doc fix” that the House removed from its bill to pass separately, and if the Obama plan would be sealed in an impenetrable vault within the National Archives, never again to be touched by God or man, then yes, the Congressional Budget Office predicts the Obama plan would reduce federal deficits by $138 billion over the next 10 years and by maybe one-half percent of GDP in the 10 years after that.

If, however, the doc fix is actually part of the Obama plan, and that law would be subject to normal political forces  plus the new political dynamics the law would create, then the CBO predicts the Obama plan would increase federal deficits by $59 billion over the next 10 years and maybe one-quarter percent of GDP in the subsequent decade.

So really, the Obama plan’s impact on the deficit comes down to which one of those scenarios best describes the Obama plan, and which one is a partisan fantasy.