Too Focused On Insurance?

Apr 12 2011 @ 3:32pm

Ezra Klein points to an alleged blindspot of mine (and DC pundits in general):

[H]ealth-care costs are not all about, or even mostly about, insurance. Indeed, so much as I like exchanges, it’s very possible that you need the government putting pressure on the delivery system to control costs. What we tend to see with private insurers is that they just don’t have enough leverage over hospitals or doctors to get major changes done. Medicare does have that leverage, which is why it makes sense to use Medicare as a tool to reform the health-care system, as opposed to just the health-insurance system.

But I've specifically endorsed the cost-control pilot schemes in the ACA.

I do indeed see the need to find a way to get much more value for money within healthcare delivery. But I also see the power of the consumer as worth harnessing. One small reform I'd favor is making co-pays much more linked to the actual cost of the relevant procedure or drug. If you pay 30 percent for a new drug, rather than a flat fee of, say, $30, you're going to become instantly more aware of the generic option. Why not all of the above?

On this topic, it's worth revisiting the cover story in the September 2009 Atlantic by David Goldhill. As a bracing assessment from first principles, it's held up very well.