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George Halverson on health care reform
Ah, remember that topic? Ezra Klein does. The book is called Health Care Reform Now! and the author is CEO at Kaiser Foundation Health Plan. That may not sound like an encouraging combination but in fact this is one of the most intelligent health care policy books around. The analysis of cost inflation, lack of early care, and billing for procedures is perceptive throughout. The policy proposals involve electronic medical records for everyone, legally required health insurance, enforcing that mandate through the tax system (will he really cut off EITC to kids?), high-deductible plans for the high-income insured, covering some of the uninsured through an expansion of Medicaid (expand SCHIP and cover the single poor), offering primary care-first health insurance plan to the remaining poor uninsured, and finance the whole thing through a health care sales tax. I like that last part best of all. Plus he wants to reform the entire infrastructure of health care and institute more pay for performance.
I'm puzzled as to how he avoids destructive "notches" (implicit high marginal tax rates) across different individual margins and what private insurance companies will do with perfect access to everyone's electronic health care records. And he doesn't focus enough on encouraging innovation or dismantling bureaucracy and barriers to entry. Still, this is one of the most substantive books out there on health care economics. Recommended to anyone who might be tempted.
Addendum: I've now read through the comments and I have to admit I am a little disappointed. I don't favor Halverson's solutions overall though I do favor a much greater role for integrated HMOs. The more important point is that I should be able to cover a book, and discuss its virtues, without having to come down on it, or for it, in a partisan way.
Posted by Tyler Cowen on October 11, 2008 at 05:00 AM in Medicine | Permalink
Comments
Is it better than Code Red by David Dranove?
What about Redefining Health Care: Creating Value-Based Competition on Results by Michael Porter. That one sounds interesting.
I think the best book on the subject would be co-written by Porter, Cialdini, Micheal Lewis, Gladwell and Friedman, Tyler and Alex and an actual, real live, you know, doctor (and I don't mean PhD, and the fact an obvious name doesn't come to mind is really sad on a lot of levels, okay, Ron Paul). Unfortunately, mythical alternatives are unavailable options, but I smell continuing series!
If someone held a gun to my head and gave me 5 seconds to decide what book I had to read on the subject, which one? Or, maybe you'd let me die. That would save on medical bills and I wouldn't have to end my days in a government run hospital, or slog through these books. Maybe you, me and the gunman could work out some kind of deal.
Posted by: Andrew at Oct 11, 2008 5:56:12 AM
Excellent suggestions. I would also recommend Maggie Mahar's "Money-Driven Medicine" and Mike Magee's "Health Politics." The latter is an M.D.
Posted by: Selby Bateman at Oct 11, 2008 6:35:38 AM
I'll definitely need to check that out. I'm wondering if you've read Laurence Kotlikoff's "The Healthcare Fix"? It's basically a description of the plan that he wrote for Mike Gravel.
Posted by: Raymond Saade at Oct 11, 2008 8:16:57 AM
My understanding is that we sort of do the health-care-sales-tax already. Hospitals overbill the uninsured in part to cover those who don't pay their bills. (Of course, giving more people an incentive to not pay their bills.)
Perhaps a significant health care tax would reduce the incentive for therapists, acupuncturists, chiropractors, optometrists and the like to have insurance coverage for their services be mandatory.
Posted by: Alex J. at Oct 11, 2008 10:28:20 AM
Funny, I thought Paul Krugman had his own blog on nytimes.com. I didn't know he was now blogging at MR.
Posted by: Anonymous at Oct 11, 2008 12:39:29 PM
legally required health insurance, enforcing that mandate through the tax system (will he really cut off EITC to kids?)
I live in Massashusetts where we have a mandate. It is a huge giveaway to the entire healthcare industry. It effectively makes it illegal to start a competing insurance company that has innovative, lower cost plan. It also makes it illegal to buy low cost, high deductible plans. Instead, the mandate forces everyone to buy incredibly expensive kitchen sink plans that cover a lot of stuff with no proven medical benefit.
Posted by: Devin Finbarr at Oct 11, 2008 12:53:15 PM
It is interesting that you are discussing health care in the middle of a crises that demonstrates how the shift from defined benefits pension plans to defined contribution pension plans was a major cut in the real income of middle class Americans.
Can your make a serious argument that the libertarian, conservative insurance plans are any different than the shift to defined benefit plans were?
Posted by: spencer at Oct 11, 2008 6:23:48 PM
I know that this is a bid to be "realistic" about the health care situation in this country, but is this really what you would call a libertarian solution?
Now I'm not an economist, merely a student, but aren't there a number of reasons that health care costs are as high as they are? And wouldn't this plan be more of the same, might it not make the situation even worse? It seems like another way to redistribute wealth rather then fixing the situation.
Posted by: at Oct 11, 2008 7:53:31 PM
I know that this is a bid to be "realistic" about the health care situation in this country, but is this really what you would call a libertarian solution?
Now I'm not an economist, merely a student, but aren't there a number of reasons that health care costs are as high as they are? And wouldn't this plan be more of the same, might it not make the situation even worse? It seems like another way to redistribute wealth rather then fixing the situation.
Posted by: at Oct 11, 2008 7:54:09 PM
I know that this is a bid to be "realistic" about the health care situation in this country, but is this really what you would call a libertarian solution?
Now I'm not an economist, merely a student, but aren't there a number of reasons that health care costs are as high as they are? And wouldn't this plan be more of the same, might it not make the situation even worse? It seems like another way to redistribute wealth rather then fixing the situation.
Posted by: at Oct 11, 2008 7:54:17 PM
The way I see it, we have three options:
1) Ration health care (this was the European solution, and why their health care costs are so much lower than the US's)
2) Don't ration but continue subsidizing health care costs (This will lead to more and more expensive health care, but is what we are doing now. Its extremely expensive, and makes up a large part of both the US budget and a household budget.)
3) Use markets to ration while increasing supply. This means allowing more doctors and nurse practitioners to enter the market. A minimum competency style certification would do that, as would creating a competitor to the AMA. Another option is to create a program that doesn't force prospective doctors to get a bachelor's degree before going to medical school, but rather having a shorter all in one professional degree.
Posted by: landivar at Oct 11, 2008 9:05:50 PM
The policy proposals involve electronic medical records for everyone, legally required health insurance, enforcing that mandate through the tax system (will he really cut off EITC to kids?), high-deductible plans for the high-income insured, covering some of the uninsured through an expansion of Medicaid (expand SCHIP and cover the single poor), offering primary care-first health insurance plan to the remaining poor uninsured, and finance the whole thing through a health care sales tax. I like that last part best of all. Plus he wants to reform the entire infrastructure of health care and institute more pay for performance.
Oh yeah, like 60 years of government mandates, intervention and tax code coercion have produced success after success. There's no mention of reforming the exclusionary aspects of occupational licensure or taming the litigation monster.
When exactly did this site cease being "marginal revolution" and start lurching toward "marxist revolution".
Posted by: Superheater at Oct 11, 2008 11:38:04 PM
Tyler:
I continue to be disappointed with many of your health care posts.
These proposals will not control costs, they will not improve qualilty and they will not improve access -- even as they cost billions of dollars of taxpayer money.
Other than that I'll take you word that the book is a good read.
Posted by: John Goodman at Oct 12, 2008 6:16:20 PM
"I've now read through the comments and I have to admit I am a little disappointed."
The price of popularity... or as Kingsley Amis put it, "more will mean worse."
Posted by: Rich at Oct 14, 2008 10:43:30 AM
