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By now we should all understand that if you put together GOP plans to repeal the Affordable Care Act and also “block-grant” Medicaid, tens of millions of Americans would quickly lose access to affordable health care. If you buy the conservative health care philosophy, and/or believe Republican claims of interest in something approaching universal health coverage, some of these unfortunate people might regain access to minimal levels of care via high-risk pools and tax credits. But that’s obviously not a very high priority for the GOP, which according to its own rhetoric is more interested in holding down health care costs by encouraging “individual responsibility” (i.e., paying your own medical bills) for health treatments and outcomes.
But aside from the issue of the Republican Party’s “market-based vision” of the overall health care system, its commitment to a devolution of responsibility for public health care programs affecting low- and middle-class Americans who have not reached retirement age has its own destructive dynamics. At The Incidental Economist, my friend Harold Pollack makes the essential but rarely understood point on this subject:
States have long worried about becoming “welfare magnets,” attracting poor people to make similar moves. There is a lively empirical debate about how often this actually occurs. Poor people are less mobile than you might think. As a political matter, no state wants to become a magnet for such inflows. From a national perspective, this dynamic promotes a “race to the bottom,” in which states seek to offer less generous benefits than they otherwise would. This race to the bottom is reinforced by deep ideological and economic differences across state lines.
Before Social Security and Medicare, these same debates once occurred regarding state efforts to help impoverished or sick elderly people who could no longer care for themselves. Today, no politician would self-immolate by suggesting the block-granting Medicare or otherwise devolving supports for seniors to state governments.
We have not achieved the same consensus regarding health care for poor people or the disabled. In 1965, Medicaid established national minimum benefits, and provided national resources. ACA expanded these national commitments, devoting federal resources to finance near-universal coverage. On the surface, the health reform fight includes technocratic disputes over budget estimates and over which level of government is best-equipped to provide needed services. The real fight is much deeper than that.
There’s a remarkable historical inversion going on in this GOP effort to unravel a national commitment to low-income health care, by the way: what ultimately became “Medicaid” began as the Republican Party’s alternative to the universal, national health care system first promoted by Harry Truman and eventually established, for seniors only, in Medicare. Now Republicans claim to be championing Medicare (although simultaneously unraveling it via various efforts to cap or voucherize benefits and privatize its insurance function) by pitting it against ACA and Medicaid.
There is a natural partisan-political and ideological affinity for today’s Republicans to pursue this old folks versus poor folks strategy, of course. With the two parties increasingly polarized by age and race/ethnicity, GOPers have every political reason to place the vitiation of Medicare (and for that matter, Social Security) on the back burner, and treat health care for non-seniors as “welfare,” designed for those improvident and/or darker people, to be devolved to the tender mercies and inflexible budgets of state governments. (Yes, a big portion of Medicaid spending goes to long-term care for the elderly, but not necessarily the elderly who vote Republican).
But beyond the brutal generational politics of the matter, Republican efforts to treat Medicare and Medicaid so very differently relies on the belief of many seniors that the former is an “earned benefit” or a self-funded program (via payroll taxes and premiums, which only cover about half of Medicare benefits) while the latter is a “redistribution” program or “welfare.” This is the flaw in the conviction of some progressives that “Medicare for all” is the winning magic formula for achieving universal health coverage: few conservative seniors will support “Medicare for all” if it includes those people who haven’t “earned” it or paid for it.
In any event, Republican fiscal and health care proposals would decisively decouple health care treatment of the elderly and the poor/disabled (along with the middle-class uninsured that would be covered via ObamaCare) and send the latter straight into a race-to-the-bottom negative competition among states that is sure to ratchet down coverage, particularly as federal cost-sharing is steadily reduced (as the Ryan Budget would guarantee). It’s an aspect of the health care and budget debates that deserves vastly more attention than it has yet received from either party.
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R.L. Alitheia on June 10, 2012 10:57 AM:
Great to have you back, Ed. My prayer this Sunday AM is that you found peace and hope in your difficult hour.
-RL
c u n d gulag on June 10, 2012 11:00 AM:
As I said yesterday, and I'll repeat it again:
This is ALL being done on purpose!!!
I won't bore you with another rant/diatribe - if you're interested in this idiot's opinion, read yesterday's post, titled, "Chris Hayes on Elite Failure."
They're acting like there are all 'unintended consequences," but they're not - the Conservatives have been planning and praying for this all of their lives.
And it WILL happen - if we sit on our asses in 2012, and 2014, and 2016, and '18, and '20, and etc, etc, etc,.
stormskies on June 10, 2012 11:10 AM:
You ever wonder why the corporate media purposefully ignores what the state of Vermont has done with health care ? A state that has a Democratic Governor, Senate, and House ? A state that has passed a 'single payer' system that has now lowered the costs for health care in that state ?
Yet another sad example of the 'gatekeeper' role of our corporate media that decides what to 'present' and 'how' to present it.
lou on June 10, 2012 11:29 AM:
We need to decouple congress critters from their taxpayer supported, government employee health insurance. Let them choose from policies in the individual health care market and let them have a strong dose of reality. Until then they'll keep giving us these free market "solutions".
Dave on June 10, 2012 11:29 AM:
I'd also like to point out, re: the GOP's "market-based vision": in the health care industry (and any industry dominated by insurance) it is IMPOSSIBLE for the free market to guide the system anywhere near efficiently, because the presence of insurance decouples demand and payment and makes supply-demand forces unfelt.
Because the person "demanding" a service (the person being treated) is not paying for most of the cost (their insurance is), free market forces are not able to work. If you've paid your own way in the health care system, you've seen the effects -- how hard it is to find anyone who knows how much treatment will cost, the decisions providers make that clearly don't factor in cost, etc.
All this means, of course, that health care and health insurance cannot function efficiently or effectively without appropriate regulation...
hells littlest angel on June 10, 2012 11:34 AM:
@lou: I suspect that if a congressperson went to an insurance company and asked what sort of health care policy he could get, he would be presented with some really generous offers. Just a hunch I've got.
bloomingpol on June 10, 2012 12:01 PM:
The NH GOP legislature had a try at block-granting Medicare this year. So not all of them are avoiding this.
ragbatz on June 10, 2012 12:20 PM:
For the "low-income, low-asset" elderly who require nursing home care, Medicaid provides that care. With provisions enabling the middle-class elderly to "spend down" and to partially redistribute assets, Medicaid is long-term care insurance that keeps the middle-class children of the institutionalized elderly out of poverty. Block-granted health care funding to states will itself be fractionated to the interests of middle-class families - leaving still less for "those people".
atlasfugged on June 10, 2012 4:36 PM:
@Dave: I'm not sure if your comment was meant as a endorsement of the standard conservative/Republican theory of why the market for healthcare is failing, but even if that was not your intent it comes across that way. If I misinterpreted your comment, then I apologize. Nevertheless, I'd like to address a this idea that the key to overcoming the problems with the healthcare market lies in exposing healthcare consumers to more "supply-demand forces".
I think the fallacy at the heart of the conservative theory on how healthcare markets work is the presumption that healthcare is like any other consumer product - like cars or food or iPhones - and, as such, the market for healthcare should behave identically to markets for other products. The theory rests entirely on that presumption. However, I believe that presumption is erroneous.
Healthcare is a unique among products and services that we consume. And, the market for healthcare is, therefore, fundamentally different from the market for other products and services. The differences I believe are threefold. First, unlike the markets for other products and services, there will always exist a wide gulf in the information available to producers and providers of healthcare and the information available to consumers necessary to make cost-conscious purchasing decisions. Providers of healthcare generally have an expertise that most consumers will never have. Even if the average consumer is given a detailed listing of the costs of each procedure, test, and medication involved in her treatment (the length of that list may be intimidating in itself), she will likely lack the expertise necessary to make an informed judgment as to which procedures, tests, or medications are necessary and which are unnecessary. WebMD and Wikipedia are not a substitute for medical school and experience in medical practice. So, the consumer defers to the judgment of the provider out of not just expedience, but necessity.
Secondly, medical treatment is often administered in conditions where there is little time for consumers to shop around, to educate themselves on the pros and cons of a particular procedure, or to do the myriad other tasks that consumers typically perform when making a purchasing decision. This exacerbates the disparity of information described above. Even if consumers could make informed treatment decisions on par with the judgment of providers, they are often not given enough time - or in cases of trauma, lack the capacity – to make informed decisions. You do not shop around when you or a loved one is having a stroke. You do not weigh the cost efficacy of tPA versus the administration of streptokinase. You may not even be conscious in the first place.
Lastly, and perhaps most importantly, the demand for healthcare is highly inelastic. I think this reality is lost in most discussions of the market for healthcare. I think the notion of inelasticity has seemed almost inconceivable to most conservatives who think about healthcare. The inelasticity of demand in the healthcare market renders it inherently inefficient and fundamentally different from markets for products like iPhones or services like plumbing. And, there is little chance of any external or internal market force eliminating or even significantly reducing this aspect of the healthcare market. The inelasticity derives from the fundamental human desire to keep on living with as little physical suffering as is possible. Indeed, the persistence of life and the avoidance of physical pain is common to all lifeforms. People will do what is necessary to continue living, ultimately without consideration of monetary costs. This is not to say that exposure to the costs of healthcare won’t change consumer behavior in relation to non-emergent. If a consumer has to pay the full cost of treating the strep throat or a rash, she may reconsider whether it is worth visiting a doctor or allowing the ailment to run
atlasfugged on June 10, 2012 4:38 PM:
... [character limit!]
Lastly, and perhaps most importantly, the demand for healthcare is highly inelastic. I think this reality is lost in most discussions of the market for healthcare. I think the notion of inelasticity has seemed almost inconceivable to most conservatives who think about healthcare. The inelasticity of demand in the healthcare market renders it inherently inefficient and fundamentally different from markets for products like iPhones or services like plumbing. And, there is little chance of any external or internal market force eliminating or even significantly reducing this aspect of the healthcare market. The inelasticity derives from the fundamental human desire to keep on living with as little physical suffering as is possible. Indeed, the persistence of life and the avoidance of physical pain is common to all lifeforms. People will do what is necessary to continue living, ultimately without consideration of monetary costs. This is not to say that exposure to the costs of healthcare won’t change consumer behavior in relation to non-emergent healthcare. If a consumer has to pay the full cost of treating the strep throat or a rash, she may reconsider whether it is worth visiting a doctor or allowing the ailment to run its course. However, it’s not the treatment of strep throat or dermatitis or minor ailments that are causing healthcare costs to rise precipitously. It is the treatment of major medical emergencies and major chronic illnesses that represent the bulk of healthcare costs in any healthcare market. When it comes to major illnesses, however, the desire firstly to survive and secondly to minimize physical suffering far outweigh concerns about price. How many people would forgo treatment if they or loved one is having a heart-attack, even if they knew the costs would be beyond their ability to pay? How many people would choose a less effective, but cheaper, treatment for pancreatic cancer out of concern for costs? How many people would forgo treatment altogether for pancreatic cancer given that its statistically high mortality probably means that whatever is spent on treatment will likely be wasted? Few consumers would choose the cheaper treatment if it increased the likelihood of death and/or physical suffering. So, while healthcare is responsive to price at the margins, for treatment of anything more than the common cold or rash and in particular for the treatment of major ailments which drive healthcare expenditures, people are generally unresponsive to price. The demand for the type of healthcare that drives healthcare expenditures in any healthcare market is, therefore, price inelastic. As a consequence the market for healthcare is inherently inefficient.
The question for policymakers is how does society deal with this inefficiency. Conservatives prefer to ignore the inefficiency and leave healthcare consumers to the vagaries of the inherently inefficient healthcare market and thus to mercy of the healthcare providers (and their lawyers). The costs do not magically disappear by simply calling your solution a “free-market” one. People, who have this annoyingly persistent desire to live, will still demand treatment whether they can pay or not. The costs will be socialized nonetheless. The conservative approach merely demands that those costs be socialized in a manner that is ad hoc at best and chaotic at worst. The approach is ultimately destructive not just to consumers of healthcare but to healthcare market as a whole.
The better approach is to acknowledge the inefficiency of the healthcare market and then to manage the socialization of the costs, which that inefficiency induces, in as transparent, equitable, and efficient manner possible. Contra Dave, networks of insurance are one way of achieving this. For each program of insurance, the costs of expensive healthcare (healthcare whose costs exceed premiums) are socialized among the pool of beneficiaries. This has p
atlasfugged2 on June 10, 2012 4:40 PM:
[character limit again!]
The better approach is to acknowledge the inefficiency of the healthcare market and then to manage the socialization of the costs, which that inefficiency induces, in as transparent, equitable, and efficient manner possible. Contra Dave, networks of insurance are one way of achieving this. For each program of insurance, the costs of expensive healthcare (healthcare whose costs exceed premiums) are socialized among the pool of beneficiaries. This has proven to be of relatively effective until the last quarter century. Another approach is to socialize the costs among all members of society through a universalized healthcare system. The ACA, assuming it survives the conservative justices of the Supreme Court, and healthcare systems of other countries aim to do this to varying extents.
cookie baker on June 11, 2012 11:10 PM:
Good evening,
I do agree that we need to have more discussion on the crux of the issue, paying for everyone's care as a matter of common good. Or, as it is said also, as a human right. People in the "Medicare for All" world do discuss this, but is not in the public realm.
My impression of the stumbling blocks before getting to universal health care that is truly accessible for every citizen are these:
1. We need a belief that is is good for the whole country to have a healthy and productive work force.
2. Believe that everyone needs and should have medical care, no matter what. That it is necessary, not an option and that we are a society that provides for it's citizens. (We could use help with that on the housing, food, and education fronts, as well).
3. Correct the myth that we are the best medical care model and providers in the world. We are not.
4. Correct the myth that people who don't have insurance, and/or money, just get care anyway. This is not true. People die. 45,000 per year here in the US.
5. Dispel the myth that private insurance equals health care. No. It is a business, not a system for providing a service for the common good, like the FDA. It is about profit, no matter what.
I would love to hear your ideas on this-
cookie baker on June 11, 2012 11:26 PM:
Hi again,
Just to clarify-the "they didn't work for it so they don't get any..." sentiment is deep. Very deep.
And, I love the amazing medical centers and care that we have access to-incredible work done there-but as a nation, we are 37th in world health outcomes, so the wealth is clearly not shared in our medical health model.
G'night