Congress Gets a Shot in the Arm

It would seem that the United States Congress is getting themselves mobilized to make an impact on health care. How much of these efforts end up being substantive and how many ephemeral is a question answerable only by the passage of time.

Ben Bernanke's recent statements about health care taking up a quarter of the federal budget were only one facet of the mobilization beginning on several fronts within those hallowed halls.

Sens. Ron Wyden (D-Ore.) and Robert F. Bennett (R-Utah) are sponsoring the first bipartisan proposal for universal coverage to come out of the Senate. The proposal would scrap employer-based health insurance replacing it with a state-run system where insurance companies are mandated to offer basic coverage to all applicants and compelling those not covered by employer-based plans to buy in.

Tom Daschle has just released a new book in which he argues in favor of a Federal Health Board similar in structure to the Federal Reserve. This probably will be one of the thrusts of the legislation he is currently working on along with fellow Democrat George Mitchell and Republicans Bob Dole and Howard Baker. The four former Senate Majority Leaders plan to introduce their legislation in November. (For an in-depth interview about the book and Sen. Daschle's stance on health care take a look at the interview that he did with Ezra Klein for the American Prospect.)

Via The Washington Post:

"We have a broad consensus that we aren't getting nearly as much as we should for the money," said Mark B. McClellan, President Bush's former director of the Centers for Medicare and Medicaid Services who now heads the new Engelberg Center for Health Care Reform at Brookings. "There's an unprecedented level of agreement that something can be done and that something must be done."

Let us keep our fingers crossed and our eyes open.

SOURCE: "Writing New Prescriptions For Change" 06/17/08
photo courtesy of yanivba, used under its Creative Commmons license

Bernanke Addresses Health Care Issues

On Monday, Federal Reserve Chairman Ben Bernanke addressed the Senate Finance Committee's Health Reform Summit (full transcription here). Bringing his financial acumen to the table, he reframed the question of health care cost, putting into a perspective of "What are we gaining from these expenditures?" rather than the usual absolute and simplified "What does it cost?"

From the economist's perspective, the question of whether we are spending too much on health care cannot ultimately be answered by looking at total expenditures relative to GDP or the federal budget. Rather, the question, whatever we spend, is whether we are getting our money's worth. In general, good information and appropriate incentives are necessary to allocate resources efficiently. In health care, the necessary information should include not only the clinical effectiveness of certain tests or courses of treatment but also their cost-effectiveness. As the regional comparison of health-care costs illustrates, cost-effective approaches may be at least as useful as more costly approaches in delivering good health outcomes.

His remarks were tightly focused on health care cost and its impact on the U.S. financially. Monetary policy and overall comments about U.S. economy were not addressed other than as they affect health care. He also declined to make any solid policy recommendations.

Among other issues, Bernanke pointed out that rising costs of health care are quite liable to reduce access to health care as the lower income elements of the U.S. are priced out of both care and insurance. Hardly an earth shattering observation, but one that is lent weight by his bringing it up in this particular forum.

"The best way to reduce the fiscal burdens of health care is to deliver cost-effective health care throughout the entire system"

Hopefully this will turn some attention towards the inadequacies of the "pay per procedure" methodology that has driven American health care for decades.

SOURCE: "Chairman Ben S. Bernanke At the Senate Finance Committee Health Reform Summit, Washington, D.C. Challenges for Health-Care Reform" 06/16/08
photo courtesy of Ashley Pollack, used under its Creative Commons license