A "Health Care Fed" and Obama
An idea that has been floating around for some time is that a "Health Care Fed" needs to be created as a means to control health care costs.
I first heard of the concept in a conversation I had with former Surgeon General C. Everett Koop a few years ago. Later, the idea showed up as a centerpiece in the National Coalition's plan to reform the health care system.
And in both cases, I have supported it.
Most recently, it showed up in former Senator Tom Daschle's new book, "Critical: What We Can Do About the Health Care-Crisis."
Maybe more important than the endorsement of a "Health Care Fed" from these folks are Barak Obama's comments regarding Senator Daschle's book and his support of the "Health Care Fed" idea:
“The American health-care system is in crisis, and workable solutions have been blocked for years by deeply entrenched ideological divisions. Sen. Daschle brings fresh thinking to this problem, and his Federal Reserve for Health concept holds great promise for bridging this intellectual chasm and, at long last, giving this nation the health care it deserves.”Many will dismiss the concept as just government controls. But before they do, I hope they give some thought to just what it is the Federal Reserve, that institution beloved by Wall Street, does and how they can rationalize a government bureaucracy that controls, of all things, the money supply with their opposition to this idea.
If any part of our economy needs its money supply managed, it is our health care economy.
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14 comments:
I believe the Federal Reserve Bank is a private organization. It seems to me that their machinations, while initially good, have caused much of the credit crisis, much of the deficit spending and the weakening of the dollar worldwide.
That does not make me feel all warm and fuzzy about what such an organization would do for health care.
Before endorsing the notion of a Health Care Fed, one should read William Greider’s book, Secrets of the Temple: How the Federal Reserve Runs the Country. It will make you hair stand up.
Just because the Federal Reserve does things we find unpleasant, doesn't mean it is doing things that are wrong. I cannot save each of us from our own short-sightedness, nor Congress from its pandering, nor corporations from the consequences of their own overreach. It is there to keep America's economy going. Not yours. Not mine. Not Citifinancial's. Not Bank of America's.
In that, it has performed quite well, and is a delightful model that the healthcare sector would do well to follow.
Sounds like govt controls to me.
If we have a healthcare Fed, why not a FoodFed, a CompuFed, an AutoFed, a HousingFed, a PlumbingFed, an FedAccouting, and LegalFed?
Yes! The first thing you need to do in order to get complete government control of something (maybe after government has created the problems in the first place) is to declare it a crisis which only government can solve. Half of all health care funding comes from government and is effectively open-ended. Don't you think that this might have just a little to do with the costs going up and up?
I also like the concept of a healthcare entity modeled after the Federal Reserve. The Fed's strength is its political independence which gives it the ability, when necessary, to implement monetary policies that may cause short term economic pain but are likely to produce long term, sustainable gains for the economy. What many people don't appreciate, however, is that the Federal Reserve also has its own funding source which Congress cannot cut off or interfere with if it is upset with Fed policies. The Fed earns money from the federal funds rate it charges banks that borrow money from it as well as from buying and selling government securities. Moreover, according to former Fed Chairman, Alan Greenspan, writing in his recent book, The Age of Turbulence, the Fed's annual budget is only about $300 million or so. It employs about 2,000 people in Washington and the 12 Federal Reserve Districts.
If a Healthcare Fed were funded by Congress like any other agency, how is it going to maintain its independence? Remember what happened to the Agency for Healthcare Research and Quality when it tried to suggest that we were doing too many unnecessary back surgeries? I hope we can make it work, but forgive me if I'm a bit skeptical.
Because the food, computer, auto, housing, plumbing, accounting, and legal markets work efficiently. That is, their costs generally go up at the rate of underlying inflation rather than 2-3 times that rate--as does health care.
Bingo! Now, why does health care go up so much more than these UNSUBSIDIZED industries? Because it is subsidized. The inefficiency comes from government interferrence!
Sure, as if the housing market doesn't have the biggest subsidy of all -- the mortgage interest deduction (and it was precisely the failure of the Fed to constrain ridiculous market behavior that created the bubble and collapse). I'm pretty sure all of the other industries have their own glorious/pernicious subsidies. But let's take the subsidy argument at face value and put it up for a vote: who prefers a/ something like a Fed for health care, or b/ euthanization of Medicare and eradication of all forms of health insurance?
In the past five years, one could hardly argue that the food (read: commodity) and housing markets were/are working efficiently.
If healthcare worked like a market, that is, prices that varied from doctor to doctor from time to time and with consumers comparison shopping it would be far more efficient.
There are two things in healthcare over the last 15 years that have had better and better outcomes and lower and lower prices. What are they?
Lasik and cosmetic surgery.
Why?
Markets.
Let's put the rest of healthcare on a market footing.
When American thinking arrives at the conclusion that health care is not a business nor a business commodity, effective reform can evolve. Currently, the dollar bill directs the occurrence of health care and sometimes its quality. Lack of dollars is then an obstruction. If thinking and subsequent action develop around the concept that the occurrence of health care should direct health care expenditure, then a system that provides clear and equal access to vital, comprehensive health care, i.e., to sound, ongoing doctor---patient relationships, for everyone living in America can happen. I do not believe this can occur in a multi-payer system. I think the health insurance industry will have to be sacrificed and a single payer system will have to be developed and operated by the federal government, perhaps in a Department of Homeland Medicine. However, if such is created, it cannot simply transfer the fundamental flaw of our current system, i.e., that health care is a business, or in other words, that the dollar bill directs the occurrence of health care, onto the single payer. I believe that is what is wrong with H.R. 676; it transfers the miseries of the mutli-payer onto a single payer. True success for a single payer can occur if the payer has the power to set (after a process of honest, fair, and firm negotiation) the cost (price paid) for services and product. In this way, the doctor---patient relationship, absent embedded conflicts of interest, can function without hindrance and actually direct health care expenditure without bankrupting individuals or our country.
R. Garth Kirkwood MD
http://www.equalhealthcareforall.com
doctork@equalhealthcareforall.com
Sorry Doc. I have the darndest time understanding what you are trying to say. "(T)he occurrance of health care should direct health care services..."? I would think that health issues would direct health care services, facilitated by money, just like any other service. And I can't for the life of me understand why health care services aren't businesses.
Response to Anonymous:
Thank you for your comment. I think you have good understanding of what I am saying. Your statement, "I would think that health issues would direct health care services, facilitated by money," (the remainder of your statement, "just like any other service," I am not sure about) is in accord with my thinking. But it just doesn't work that way.
Health care services are businesses that operate within the economic marketplace. That is why your (and my) thinking is just (at present) not reality.
My definition of health care is the doctor---patient relationship. My agenda is the formation of a health care system that provides clear and equal access to vital, comprehensive health care for everyone living in America in an affordable manner. Therefore, my health care system has to provide clear and equal access to sound, ongoing doctor---patient relationships for everyone in America in an affordable manner and at the will of the patient. Our current system effectively blocks this because it is dollar driven as opposed to being health care driven, i.e., doctor---patient relationship driven. If you have the dollars you can acquire health insurance and pay for all the business games, aka, deductibles, copays, coinsurance, ever increasing premiums, pharmacy bills etc. For those people with enough money, money truly does facilitate their occurrence of health care. However, lack of money is an obstruction for a large segment of our population. I am not just talking about the 45 million uninsured but also about the millions of others who do not go to the doctor, this decision being based on monetary factors, i.e., deductibles, coinsurance, copays, and pharmacy bills, when they otherwise would go. The money issue then effectively blocks the occurrence of health care, the proper functioning of sound, ongoing doctor---patient relationships. Health care businesses (hospitals, drug companies, technology companies, doctors' practices, and others), operated upon a system designed to augment their income and/or profit margins on an ongoing basis, fuel the business cycle of ever increasing premium and deductible payments, the increasing presence of coinsurance, the restrictions on care written into insurance policies and the decisions to drop people by the insurance company, when they become too expensive. So the dollar bill does not facilitate health care for a large and increasing segment of our population but rather obstructs health care either by interfering with the decision making within the doctor---patient relationship or by prohibiting the formation of this relationship altogether.
What you say in your comment, what you think would be happening, requires that we create a new bottom line (instead of the dollar bill) for our health care system, while still maintaining reasonable profitability for health care businesses such as hospitals, drug and technology companies, other businesses, and reasonable fees for service for doctors. To do this, I believe, will require a single payer which sets, after negotiation, the prices paid for services and product. I do not think that this can ever happen with a multi-payer system; I believe that the health insurance industry needs to be sacrificed. The new bottom line should be the occurrence of sound, ongoing doctor---patient relationships penetrating into every American community and functioning without interference from the payer. This will require overhaul of our entire system but it begins with understanding and accepting that the doctor---patient relationship is fundamentally more important than the dollar bill and that health care businesses must operate with support of this relationship as their primary goal and with their income and profit margins as a secondary issue. I believe this will need to be forced upon them because greed for dollars is an underpinning of much of our American ethos. I want us to be greedy about the occurrence of sound, ongoing doctor---patient relationships absent embedded conflicts of interest penetrating into every American community. Mandated altruism within the health care economic marketplace will have to occur for my thinking to become the modus operandi.
R. Garth Kirkwood MD
http:www.equalhealthcareforall.com
doctork@equalhealthcareforall.com
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