March/ April 2013 The Republican Case for Waste in Health Care

Conservatives love to apply “cost-benefit analysis” to government programs—except in health care. In fact, working with drug companies and warning of “death panels,” they slipped language into Obamacare banning cost-effectiveness research. Here’s how that happened, and why it can’t stand.

By Phillip Longman

How do we go forward? Explaining what’s at stake to the American public will not be easy. Every penny of that $750 billion the Institute of Medicine says we waste every year in health care goes into someone’s pocket. And the beneficiaries of that spending are not going to be quiet, from millionaire cardiologists performing unnecessary stent operations to drug and medical device makers peddling products that cannot be justified.

Not only are these interest groups highly concentrated and highly motivated, they are well funded and well practiced at manipulating public opinion. At the same time, even though prices in the U.S. health care system are primarily determined by a combination of market concentration, political manipulation, poor information, and sheer inefficiency, many citizens are predisposed to assume that more expensive treatments are always better than cheaper alternatives. And so, when told that “faceless bureaucrats in Washington” are busy putting a number on the dollar value of their lives in preparation for “rationing” their health care, they do indeed fear that “death panels” will decide who lives and who dies.

For those truly committed to the cause of health reform, overthrowing the ban on cost-effectiveness research now must move high on the agenda, and it requires clearly and forthrightly explaining what it really is and why it’s essential to everyone getting the best care possible. I have done the best I know how here to explain what’s going on and what’s at stake in ordinary language, but I certainly don’t have it down to a sound bite. Others must also try.

Phillip Longman is a senior editor at the Washington Monthly and a lecturer at Johns Hopkins University, where he teaches health care policy. He is also a senior fellow at the New America Foundation, where Atul Gawande is a board member.


  • booch221 on March 04, 2013 11:38 AM:

    So it's not the Military Industrial Complex that will bankrupt America, it's the Medical Industrial Complex.

  • markg8 on March 06, 2013 9:07 AM:

    Great article, awful title.

  • Rich on March 15, 2013 11:15 AM:

    The article is misleading as it is informative. This kind of research is, if anything, more common than it was a few years ago. the real problem is the recommendation part, particularly given that agencies like FDA, CDC, etc. are expected to make recommendations to the provider community and funders of services like HRSA are expected to put directives on what they fund.

  • jr13 on March 16, 2013 3:07 PM:

    Miami/Dade is the fraud capital of the south for years they have fleeced the system. all insurance claims should be gone over line by line. the way it seems to be they wait too long to check and the company's that filed the false claims are long gone.

  • Victor on July 30, 2013 8:31 AM:

    So, your case for this being 'The Republican Case for Waste' is that Republicans offered some ammendmants that didn't pass and a Democrat, Baucus, offered an ammendmant THAT CAUSED THIS that DID pass?

    How much of a partisan hack can you possibly be?

    You say 'Conservatives have long championed the use of cost-benefit analysis', and you reference Reagan & Bush, both of whom passed bills which USE that cost-benefit analysis. Even McCain indicated he wanted cost-benefit analysis to continue, as you cited above. Then you make the innane statement that 'President Obama came to office strongly sharing this conviction and committed to putting it into practice'...except he passed into law the ACA, which DIRECTLY OPPOSES that statement, right?

    There is so much more irrelevant and non-journalistic chaffe in this article. I can only hope that people will actually READ the article instead of the farce title you've used. You need to revisit any classes on journalistic integrity you have taken.

  • Brandon on July 30, 2013 9:22 AM:

    You are right about there being waste in the system. You are wrong about why it is there and how to fix it. People believe health care is "free." To be more efficient, users of health care need to be are of the costs. Moving the decisions to a bureaucracy would not help.

  • mike on July 30, 2013 1:20 PM:

    Fraud will be even higher when all of this kicks in.

    Why not talk about that.

    Taking peoples word on whether or not they can afford it and deserve subsidies! Seriously?????

    And lets talk about whether or not they will ask for and have to show an ID to qualify, if they do, then why dont they have to show it to vote.

    If not, then anyone can get care and not be rejected, and not have to pay. How much fraud will that cause????

    BOTTOM LINE, tort reform and open insurance borders is all that is needed to fix costs.