Things You Miss When You Go on Vacation
The 3 Weird Sisters recently spent a week at the beach, and this one in particular spent several days longer “on break” – the result of a longer commute to and from the destination and some dental work that demanded immediate attention upon return.
As a result, I missed out on this David Brooks gem, in which Bobo once again lectures us on the profligacy of seniors and their unreasonable expectations of receiving medical care when they are ill. The problem, according to Bobo, is that there is no one acting as intermediary to put on the brakes when an old person goes to get medical care:
The fee-for-service system is incredibly popular. Recipients don’t have to think about the costs of their treatment, and they get lots of free money.
Except, of course, they don’t. The “free money” goes to the doctors, hospitals, pharmaceutical companies & manufacturers of medical equipment and devices. What the Medicare recipient gets is the care that the consulting doctor prescribes, based on his medical expertise. Since I believe Mr. Brooks to be a towering prick rather than a stupid man, I’m pretty sure he’s entirely aware of the untruth he’s committed to paper here, and that it is deliberate.
Republicans point out that Medicare has tried to control costs centrally for decades with terrible results. They argue that a decentralized process of trial and error will work better, as long as the underlying incentives are right. They suggest replacing the fee-for-service with a premium support system. Seniors would select from a menu of insurance plans. Their consumer choices would drive a continual, bottom-up process of innovation. Providers could use local knowledge to meet specific circumstances.
Representative Paul Ryan’s Republican plan is controversial because of the amount of public money he would dedicate to his premium support plan, but the basic architecture of the plan has been around for decades. In less rigidly ideological times, many Democrats supported variations of this basic approach.
We heard this same happy-crappy from Rep. Ryan in his sales video a few weeks ago; in the Ryan view, which Bobo fully embraces, the reason it costs so much to pay for medical care for seniors is that since they aren’t picking up the tab themselves, they’re failing to shop around like they would for, say, a car or a refrigerator. That sounds reasonable, unless you’re a thinking person; if you are, it takes less than a minute for the realization to sink in that Consumer Reports doesn’t typically devote issues to “best surgeon to perform your triple-bypass” or “best orthopedic device for hip replacement.” Ryan’s plan might work well if everyone was a doctor; in a country where most people aren’t, it’s guaranteed to fail. And both Ryan and Bobo know this – these talking points are nothing more than a cynical ploy to fool stupid people into agreeing that seniors would be better off under the same system of institutionalized fraud the rest of us navigate in the private insurance market.
What both Ryan – and Bobo – leave unsaid are the following facts: for all its “terrible results” at cost control, Medicare continues to deliver more health care at a lower cost than any private insurer, and that in fact, the reason that Medicare has had “terrible results” in controlling costs is that it is those segments of the market NOT covered by Medicare – i.e., the rest of the market where private insurers are running the show – that have driven cost increases, in no small part because they are skimming 30% and sometimes more off the top of every doctor visit, hospital stay, and medical procedure. Also left unmentioned is the fact that Medicare got started in the first place because private insurers didn’t WANT to insure old people, and even now are not pressing for the privilege of insuring the least-healthy and most expensive-to-cover segment of the population. But the biggest elephant in the room that goes unremarked is this: the Ryan plan, as approved by Republicans in the House, provides only enough “premium support” to match the average Medicare costs of the youngest Medicare recipients – 65-year-olds – in the year of its implementation. Expenses for people 5 years older than minimum Medicare age typically are double those of 65-year olds. And the level of “premium support” does not increase after implementation, so as time goes on, it covers less and less of the actual cost of insurance. Hence, when Bobo says that “Seniors would select from a menu of insurance plans. Their consumer choices would drive a continual, bottom-up process of innovation,” what he’s really saying is “Seniors will get to innovate in their decision of which of their chronic ailments will go untreated.” And who knows, over time this knowledge will probably be useful to those of us who come later – we’ll know which things we really need to focus on in order to stay alive a few more months, and that being confined to a wheelchair in constant pain due to a degenerated hip joint we can’t afford to replace really IS much better than being dead because we didn’t take our blood pressure medication.
I will give both Ryan and Bobo this much – they see the end point I’ve laid out above, and their plan is remarkably honest in its reflection of their world view, even if their rhetoric isn’t: the old and useless should be grateful that we allow them to go on living once we’ve extracted every bit of profit possible from their labors. They shouldn’t push their luck.
Bobo rounds it out with this:
The fact is, there is no dispositive empirical proof about which method is best — the centralized technocratic one or the decentralized market-based one. Politicians wave studies, but they’re really just reflecting their overall worldviews. Democrats have much greater faith in centralized expertise. Republicans (at least the most honest among them) believe that the world is too complicated, knowledge is too imperfect. They have much greater faith in the decentralized discovery process of the market.
I’d only add two things. This basic debate will define the identities of the two parties for decades. In the age of the Internet and open-source technology, the Democrats are mad to define themselves as the party of top-down centralized planning. Moreover, if 15 Washington-based experts really can save a system as vast as Medicare through a process of top-down control, then this will be the only realm of human endeavor where that sort of engineering actually works.
To sum up: no one knows which view is correct, though I’ve just spewed out hundreds of words claiming that I do, in fact, know which is best. Now that we have the internet, everyone can be an expert and decide which internet source they want to believe, and this is bound to work much better than getting together a group of people who actually understand the subject matter well enough to make informed decisions. Moreover, centralized planning and control never works for vast systems, which is why FDR was such a failure at providing relief during the Great Depression and why to this very day we have the least effective and competent military in the world.