White House chief economist Christina Romer kicked off President Obama’s push to reform the nation’s health care system Tuesday, saying there are “billion-dollar bills lying on the sidewalk” if the nation can find a way to make the system more efficient.
The UC Berkeley economist, who chairs the president’s Council of Economic Advisers, said in a 51-page report that the broken U.S. health care system is ruinous to workers’ wages, living standards and the federal budget, and the payoff from fixing it could be huge. At the White House, she called health care reform a potential “game changer” for the U.S. economy, if it is done right.
But that’s a big if, given the increasingly vexing budget, logistical and political problems standing in the way of the president’s top domestic campaign promise.
Congressional Democrats hope to have legislation ready by August, and key leaders have been meeting privately to hash out issues.
[…]
The cost of expanding coverage to the nation’s 46 million uninsured is the biggest hurdle. Romer’s 51-page report focuses on making the stupendous price tag – an estimated $1.5 trillion over 10 years – look more affordable by highlighting the enormous waste in the current system.
[…]
Harvard economist David Cutler, who praised Romer’s report for its academic integrity, said the health care industry employs more people simply to pull patient records than it does nurses.Romer said such phenomenal waste makes it incumbent that officials reform the system.
1 in 4 of the dollars spent on health care goes to the staff at the insurance company and the staff at the hospital to deal with the insurance company.
You also have to remember that in the end everybody is covered now. The number one cause of bankruptcy now is illness. The bad debt gets rolled up into the cost of people who can pay.
So you can pay for the current system or you can fix it and be honest enough to tell people you will get coverage without going into bankruptcy later and lay off the overhead. Of course it will never happen because too may CEO of insurance companies are making too much on the suffering of the current chaos.
If Uncle Dave thinks the current health care system is expensive, let’s see if he sings the same tired tune when he reads about Obama’s free rationed health care.
You could save a bundle on health care with serious tort reform too. The trial lawyers drive up the cost of malpractice insurance which the doctors pass on to their patients.
Cutting government waste would save billions.
I hear that congress has a great healthcare plan for themselves. I would like to be able to join that plan.
Govt. assisted/run/controlled health system requires Governmental bureaucracy to be put in place. Every job saved by increased efficiency will cost 2 Governmental jobs to get there…
Uncle Dave said, “Combine this with eliminating fraud, and you are talking real money.”
Yep, unfortunately, when the Gov’t starts managing HC it will get even worse. I have personal exp with that.
Hold on a second here… the US has a health care system? I thought you had a bureaucratic labyrinth where only the dead can get coverage without a fight?
As for number 2, US “health care” is the most expensive in the world per capita. So, you’re assumtion is lacking some backing.
WATCH OUT! THERE’S A COMMIE UNDER YOUR BED TRYING TO KIDNAP YOUR DOCTOR!!!!
And I have personal experience with the pretty damn good government health care system in Taiwan… And my monthly premiums are only around US$30/month.
# 7 Named said, “Hold on a second here… the US has a health care system? I thought you had a bureaucratic labyrinth where only the dead can get coverage without a fight?”
No, you were reading a promo pamphlet for O’Mama’s proposal.
9,
Who’s O’Mama?
I think a government run healthcare system can work.
As long as the people elected to oversee it are from a party that believes government CAN work.
If you elect people from a party who’s members constantly state “government doesn’t work” then it will have no chance of succeeding.
Eliminating fraud and waste and administrative costs just eliminates a few years worth of cost increases. To tackle health care, you have to hold down the growth in costs, or actually reverse this. Compare it to how the budget was balanced. in the 1990s. They proposed some small cuts here and there, but overall they agreed to hold down the growth in spending to get a balanced budget. They ended up spending much more than they said they would, but by surprise ended up with even higher revenues, but that’s not relevant.
While there are some legitimate criticisms listed in that article, “stagnant wages” (because employers are spending more on fringe benefits) is the weakest of them all.
On the other side of the coin, this myth that employers are going to somehow save money and be more competitive by offloading these benefits is amusing at best.
http://gregmankiw.blogspot.com/2009/05/healthcare-competitiveness-fallacy.html
The US has the best health care money can buy, but what about the large and growing percentage of the country that can’t afford it? Of course there’s waste it’s a big business and everbody’s motivated and ambitious. Of course healthcare gets more expensive every year, every year more and more people want more and more money. Of course nothing Obama does will have any impact, the true powers will flex their lobbying might and nothing will make it past congress. In my consideration a society that won’t care for the health of it’s members is destined to become extinct.
Just as soon as Obama eliminates some (or even any) pork from the stimulus package, then we know he is serious about reducing government waste – then he can tackle waste in the private health-case system.
As it is, with the private system, all the insurance companies and medical providers have a good incentive to reduce waste: it’s called profit. Every dollar they don’t “waste” goes to the bottom line.
Can anyone name a single government program where there is an incentive to reduce spending?
For all those of you who think that the U.S. government cannot manage a healthcare system, I think you have forgotten about Medicare. It only takes a 3% cut, as compared to the 30% cut of the for-profit insurance companies. Are you thinking that we should get rid of Medicare and leave it up to private companies to manage?
# 16 Jeanne said, “For all those of you who think that the U.S. government cannot manage a healthcare system, I think you have forgotten about Medicare. ”
No, Medicare is one example of WHY we KNOW the Gov’t can’t do it. LOL
15,
But its YOUR government. Private enterprises cut expenses and then ramp up the bonuses to the execs. Is that a better solution?
I was thinking for the US a not-for-profit private insurance scheme would ameliorate the fear of communism and hatred of a broken private system…
The “basic” issue to resolve is whether or not healthcare is a public good that should be publicly provided or whether it is a service that is best regulated by market forces.
A market exists where buyer and seller are informed of all relevant facts and are in a position to bargain with multiple options available to both. IE==there is no market possible for healthcare services. Consumers are ill informed and cannot bargain.
What amuses me is the criticisms made against socialized medicine. “There is a 6 year waiting period to get a hip replacement in Canada.” Yea, if you have lung cancer and at the same time in USA if you don’t have a plan that covers the procedure or if you can’t make your deductibles and co-pays==you will NEVER get a hip replacement. Lets see==6 years is bad, Never is worse.
Crazy is having a bad system and not be willing to try something different.
17,
That was a really bad response. Your lack of detail is astounding.
19,
While you’re partly right, 6 years for hip replacement might be an exaggeration. They prioritize critical care first and elective surgery next. Reasonably so…
But, public health care IS a fundamental right. Especially for an enlightened (*cough*) country like the US. And one that is so wealthy too. That your number 1 cause of personal bankruptcy is health care is astounding and terrifying. And it’s acceptable too.
Nothing funnier in life than someone actually arguing that turning a program over to government is the way to save money make it more efficient.
Can anyone name one time this has happened before?
At least they could be honest and say that they intend to raise taxes to Swedish levels so that all may have health care coverage. But to actually say this will also save money. Wow.
Where is Alfred1? I want to hear his opinion on how the Bible supports private health insurance…
#19, your criteria for “what is a market” is quite flimsy… unless you think that a market can only exist where the theory of rational expectations holds true.
I’m and american living in spain where public health care is excellent. Why the spanish can do what the americans can’t? I’ve been giving it some thought and I guess the best answer is values. Here they prefer quality of life over quality of possesions – no believe it or not it’s not synonymous.
#22
Youre right, giving the health care industry to the government would not save money. Though, this would be becasue your government would (hopefully) not look for every possible means to deny payment for a claim.
ALL the matters here are examples of the ‘unbalanced argument’principle. That is, do not give equal weight to the points against you, the evidence against what you are trying to assert, in the same way that you give emphasis to your own (believed) points.
There is a cost to the nation for the unhealthy. There are arguments, cost arguments, other than those that lift dollars out of your own pocket.
There is an unbalance in doctors fees compared to the service they offer. Just as there is a cost to the nation for businesses refusing to fund health protection.
Two men, living together decided to have a baby by artificial anal implant. Astonished, one unconvinced member of the pair wishing to satisfy his incredulity asked the gynacologist if it was actually really possible to give birth analy.
“Where the hell do you think lawyers come from” said the gynacologist. Then, of course, there is the case of medical negligence. At the occurance of which, you should thank the gynacologist for his skills.
# 21 Named said, “But, public health care IS a fundamental right.”
Umm, no. Per the US Constitution, it isn’t.
#22–Geoff==the government does many things “better” than private enterprise: how about clean water? the military, fire fighting services, even the mail. Yes the MAIL. Choose your system: government at 44cents (?) a letter, or FedEX at $5.28 (whatever)==point being, there are tradeoffs under any system and you can be biased in favor of a system that serves everyone, or only a select few.
#24–SL==OK, you got me there. Yes, anything can be forced into a free (sic) market when you permit irrational expectations. That really is just a restatement of what I said. Healthcare is not a proper subject for a rational market and continues today only under our irrational marketplace. Happy?
#18
A common misconception is that a “not-for-profit” corporation does not strive to maximize profit. They do. They still try to bring in more revenue through grants, donations and such. They still try to trim costs. The difference is that they reinvest the profit back into the company.
One of the biggest problems in the current system is that health care is generally sold to employers and not individuals and there is no way for insurance companies in different States to compete with one another. Some interim solutions would be to streamline regulations such that there was one set of rules across all States, force insurance companies to post their rate algorithms and criteria so that it was publicly available, and finally to force insurance companies to sell to individuals and not corporations. Those changes alone would drive up competition and drive down price. For those that are not insured, there could be other solutions to help them get coverage. The simplest would be vouchers for those below a certain income level such that the government covers whatever insurance they choose. The only real problem would then be for people that cannot get insurance because of existing medical conditions.