What follows are my notes from a friend who is a md/phd up here.
He researches the economics and policy of health care.
Why do I care?
1. Reimbursement for medicaid and medicare are not enough to cover overhead, so the policy affects how I can serve those who need it most.
Also best practice is affected by what things are reimbursed, because I'll prescribe things and they must be covered to ensure that my patients take their meds.
2. Many people will seek my advice and opinion as a physician.
3. Issues of cost are becoming more pertinent and resources become scarcer.
Why do we have health care?
The costs of healthcare are extremely unpredictable. Risk aversion to income variations make people willing to pay some amount to avoid the huge fluctuations in their income.
What are the pros of insurance?
1. Shields against risk and uncertainty.
2. Insurance companies can buy service in bulk.
3. Can encourage the use of better services.
a. Vaccines as example because better for society than for the individual.
b. Improves efficiency especially with preventative services. Some individuals won't do preventative care unless insurance pays for it to prevent future costs.
4. There are proven consequences that living without insurance is more dangerous (strong literature supports this).
What are the cons of health insurance?
1. Cannot guarantee good health care.
2. Inefficiency of the middle man.
3. Overuse due to the moral hazard, because if you don't have to pay for it, you'll use more of it.
How much insurance is enough?
1. Most important to cover catastrophic events.
2. Services that are worth more than they cost.
a. preventative services
b. vaccines
How much should patients pay out of pocket?
Some out of pocket costs can reduce moral hazard overuse.
Good patient care does not always equate to good health population.
The greater good is often different.
Antibiotic resistance was in part caused by all kids getting antibiotics for ear infections.
So now individual patients have to suffer for a little longer in order to prevent multiply resistant bugs.
Another example is the use of CT scans in the emergency departments.
The good of the population is better served by not scanning everyone even though the individual would be better served by getting the scan, just in case something is very wrong.
Is a mandate to buy health insurance a good idea?
Yes, premiums will go down if penetration is high enough.
Companies can drop premiums if they get both sick and healthy patients.
Comparative effectiveness vs. rationing
rationing already exists.
Infinite need and finite resources.
Allocation decisions are being made all the time, but not backed up by evidence.
Prostate screening as example, very well funded but relatively irrelevant test, because all old men get prostate cancer and very few die from it.
Let's use evidence.
How do you make sure policies actually work?
12 year old kid had tooth ache but couldn't find dentist who would take him (because medicaid reimbursement sucks), then ended up in the hospital getting $280,000 and then dying from brain infection.
But maybe this is an extreme case?
It's not, because upwards of 10% of uninsured patients that hospitals see were on medicare.
Death panel controversy which got blown out of proportion started as a provision that would provide physicians with reimbursement for end of life counseling. The major push was a facebook post by Sarah Palin that was based on no truth whatsoever.
Misinformation is powerful and the American public is susceptible to believing whatever the media supports.
Good news is that when people understand the truth, they generally choose correctly.
Solutions will require rational discourse informed by
Suggesting Reading
Health Economics Phelps, 2009
The Social Transformation of American Medicine, Starr, 1984
"Rationing Health Care: What Does it Mean?" NYTimes, July 3rd, 2009. Uwe E. Reinhardt
"Providing High-Value, Cost-Conscious Care: A Critical Seventh Generation Competency for Physicians." Annals of Internal Medicine" Steven E. Weinberger
