Hopefully the only thing I have to say about health care

So the big topic in DC is health care reform. Oh, joy of joys. I'll try and make this as quick and painless as possible. As usual, Obama sounds like a pretty reasonable guy when he talks about health care and Congress doesn't make any sense. Unfortunately, Obama is staking the party on health care reform, and I don't think he or any Democrats nervous about their seats in 2010 are going to let up, and will probably pass just about anything.

Of course, Obama has tried to emphasize cost control in his discussion of health care, which is very nice of him. Unfortunately, people ought to talk to Congress. The CBO has made it abundantly clear that universal health care will exacerbate health care cost problems, rather than solve them. As anybody who's been following Massachusetts knows, attempting to use mandatory or universal coverage to control costs has been a miserable failure, and now the state government is considering capitation - essentially putting a cost ceiling on how much money they are allowed to use on procedures. Expanding access will not reduce health care costs in any way. Obama's health care plan is more expensive and does nothing to cut increasing costs in both private health insurance and Medicare. Allowing people to switch from a private plan to a public option will not help either - either it receives public subsidies and runs into the cost growth problems, or it acts like a non-profit HMO and doesn't do much that non-profit HMOs already do, except give the Democrats credit.

So how exactly would we reduce the cost curve? I'm not going to go into the muddled and contradictory statistical argumenets both sides offer, but here's one reason why I'm skeptical we'll be able to. Doctors and technology. While Obama's plan is far from giving us something like the health care system in France, France is a perfect example of a country with good health outcomes and a much lower cost than the United States. This is pretty much undeniable. However, people ignore the fact that doctors make 3-4 times as much money in the United States as they do in France. Of course, reducing doctor pay is unthinkinable in the US. Medical students have to take on enormous debt loads to become doctors, and they need to pay them off. Our medical schools are the best in the world, and I'd be very skeptical that our government could step in and "solve things" there without negative effects on their quality. Doctor pay is a critical feature of the US health care system. There is a reason why we hear about foreign doctors coming to the US to learn and work, and why US doctors ususally go abroad as humanitarians.

Of course, maybe if we did have a system like France's, we wouldn't have to worry about doctor pay, right? Maybe, but many doctors (in particular the American College of Surgeons) support single-payer healthcare, price controls, or similar mechanisms for health care because they'd lock in high pay (and many oppose it for the opposite reason, knowing a financially sustainable national system would likely reduce their salaries). The health care bill comes with billions in new Medicare spending that will go into doctors' pockets. Tell me this doesn't have an effect on physicians' support for health care "reform." They are good people, they're just self-interested, like people who build F-22s*, auto dealers, or pretty much any American citizen tempted with the offer of more money. I don't see any meaningful reduction in the cost curve in the future without starting a huge fight with the AMA or ACS, and Obama has trouble enough as it is now.

Speaking of taking interest groups to the mat, Tyler Cowen points out something interesting - perhaps covering seniors through Medicare is an obstacle to health care reform. This does seem to make sense, and poll numbers show the elderly are not as behind health care reform, especially that which involves critical cuts to Medicare spending. To be fair, there are a lot of complicated issues in Medicare and ethical questions about treatment. But before trying to push a national system of health care on the US, the federal government will need to get its own house in order, too - and voting demographics don't bear that out.

To respond to Cowen's question about prospects for universal health care in the '70s in a world without Medicare, I'll go ahead and say we might. Actually, Nixon's plan included employer-mandated insurance and a federal plan based on Medicaid that Americans could also join.

*Speaking of F-22s, and to get back to this blog's usual topic, way to be Senate - Obama and Gates finally won one in the battle against unnecessary but cool and pork-tastic weapons projects.