The main White House argument for health-care reform goes something like this: If we spend now on a hugely expensive new insurance program for the middle class, we can save later by reducing overall U.S. health spending. This “tastes great, less filling” theory could stand some scrutiny, not least because it is being used to rush through the greatest social spending program in American history.
What if this particular theory turns out to be a political illusion? What if the speculative cost savings never report for duty, while the federal balance sheet is still swamped with new social obligations that will be impossible to repeal? The only possible outcome will be the nationalization of U.S. health markets, which will mean that almost all care will be rationed by politics.
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Since Medicare was created in 1965, U.S. health spending has risen about 2.7% faster than the economy and on current trend would hit 20% of GDP within a decade. Every public or private attempt to arrest this climb has failed: wage and price controls in the 1970s, the insurance industry’s “voluntary effort” in the ’80s, managed care in the ’90s.
Now the White House — especially budget chief Peter Orszag — claims there is new cause for hope. The magic key is the dramatic variations in per patient health spending among U.S. regions. Often there is no relationship between spending and the quality of care, according to a vast body of academic research, most of it coming out of Dartmouth College. If the highest spending areas could be sanded down to the lowest spending areas, about 30% in “waste,” or $700 billion each year, would be saved. More than enough to pay for ObamaCare. Or so the theory goes.
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Have they seen Canadian health care costs and expectations?
The USA is the coffin and Obama is the carpenter with the hammer and nails.
What a joke this is, in order to cut waste Obama Care will have the government run Health. If it were possible for the government to cut waste why don’t they start with Medicare and Medicaid?
Canada is about to lose its safety valve of having the US as a backup for our shortfalls in Health. A couple of times we’ve sent employees to the US instead of having them wait in line in Canada. It’s sometimes cost effective to do that to get a high performance employee fixed up and back on the job quickly. I guess we’ll soon be sending them to India instead.
The Obamifacation of America will soon see Government Motors, Government Banks, Government Health … Karl Marx is smiling.