American health care is remarkably diverse. In terms of how care is paid
for and delivered, many of us effectively live in Canada, some live in
Switzerland, some live in Britain, and some live in the unregulated
market of conservative dreams. One result of this diversity is that we
have plenty of home-grown evidence about what works and what doesn’t.
Naturally, then, politicians — Republicans in particular — are
determined to scrap what works and promote what doesn’t. And that brings
me to Mitt Romney’s latest really bad idea, unveiled on Veterans Day:
to partially privatize the Veterans Health Administration (V.H.A.).
What Mr. Romney and everyone else should know is that the V.H.A. is a
huge policy success story, which offers important lessons for future
health reform.
Many people still have an image of veterans’ health care based on the
terrible state of the system two decades ago. Under the Clinton
administration, however, the V.H.A. was overhauled, and achieved a
remarkable combination of rising quality and successful cost control.
Multiple surveys have found the V.H.A. providing better care than most
Americans receive, even as the agency has held cost increases well below
those facing Medicare and private insurers. Furthermore, the V.H.A. has
led the way in cost-saving innovation, especially the use of electronic
medical records.
What’s behind this success? Crucially, the V.H.A. is an integrated
system, which provides health care as well as paying for it. So it’s
free from the perverse incentives created when doctors and hospitals
profit from expensive tests and procedures, whether or not those
procedures actually make medical sense. And because V.H.A. patients are
in it for the long term, the agency has a stronger incentive to invest
in prevention than private insurers, many of whose customers move on
after a few years.
And yes, this is “socialized medicine” — although some private systems,
like Kaiser Permanente, share many of the V.H.A.’s virtues. But it works
— and suggests what it will take to solve the troubles of U.S. health
care more broadly.
Yet Mr. Romney believes that giving veterans vouchers to spend on
private insurance would somehow yield better results. Why?
Well, Republicans have a thing about vouchers. Earlier this year
Representative Paul Ryan famously introduced a plan to convert Medicare
into a voucher system; Mr. Romney’s Medicare proposal follows similar
lines. The claim, always, is the one Mr. Romney made last week, that
“private sector competition” would lower costs.
But we have a lot of evidence about how private-sector competition in
health insurance works, and it’s not favorable. The individual insurance
market, which comes closest to the conservative ideal of free
competition, has huge administrative costs and has no demonstrated
ability to reduce other costs. Medicare Advantage, which allows Medicare
beneficiaries to buy private insurance instead of having Medicare pay
bills directly, has consistently had higher costs than the traditional
program.
And the international evidence accords with U.S. experience. The most
efficient health care systems are integrated systems like the V.H.A.;
next best are single-payer systems like Medicare; the more privatized
the system, the worse it performs.
To be fair to Mr. Romney, he takes a somewhat softer line than others in
his party, suggesting that the existing V.H.A. system would remain
available and that traditional Medicare would remain an option. In
practice, however, partial privatization would almost surely undermine
the public side of these programs. For example, one problem with the
V.H.A. is that its hospitals are spread too thinly across the nation;
this problem would become worse if a substantial number of veterans were
encouraged to opt out of the system.
So what lies behind the Republican obsession with privatization and
voucherization? Ideology, of course. It’s literally a fundamental
article of faith in the G.O.P. that the private sector is always better
than the government, and no amount of evidence can shake that credo.
In fact, it’s hard to avoid the sense that Republicans are especially
eager to dismantle government programs that act as living demonstrations
that their ideology is wrong. Bloated military budgets don’t bother
them much — Mr. Romney has pledged to reverse President Obama’s defense
cuts, despite the fact that no such cuts have actually taken place. But
successful programs like veterans’ health, Social Security and Medicare
are in the crosshairs.
Which brings me to a final thought: maybe all this amounts to a case for
Rick Perry. Any Republican would, if elected president, set out to
undermine precisely those government programs that work best. But Mr.
Perry might not remember which programs he was supposed to destroy.
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After posting this I checked my e-mail and found this entry from Rob Zerban, running for Congress in Wisconsin.
He quoted Paul Krugman from another article. It fits this post so I am adding it.
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Paul Krugman made a
great point recently about politicians like Paul Ryan. Whether it is
trickle down economics or Bush tax cuts, they think their theories are
the same as facts.
[Paul
Krugman said: "Criticism of policy proposals is not the same thing as
an ad hominem attack. If I say Paul Ryan's mother was a hamster and his
father smelt of elderberries, that's ad hominem. If I say that his
plan would hurt millions of people and that he's not being honest about
the numbers, that's harsh, but it's not ad hominem."
What he is talking about is why we have such gridlock in Washington. We cannot reach any agreements by debating anymore because Republicans refuse to accept any facts.
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