An Opinion On “Industry Seeks Savings From Medicare Beneficiaries”
It seems that you don’t believe that ‘consumer-driven’ models will effectively control health care costs without significantly reducing the overall quality of care. Since the current third-party fee-for-service model has the largest health plan in the country (Medicare) goal setting theory the benchmark unit prices based on RBRVS then it would appear that you believe the only way to rein in overall costs is to ratchet down unit prices, tie them to an index such as CPI or make them static. Since the number of beneficiaries eligible for care grows annually, the increase in total costs would increase by the multiple of both the increase in unit prices and the increase in the number of beneficiaries – assuming that the individual utilization of services remains static. If utilization goes up, the increase would be even greater.
I don’t agree with you that the issue is purely a ‘supply-side’ problem; I think it is both a supply-side and a demand-side. If it were purely ‘supply-side’, the solution would be to increase the number of providers – presumably mid-level (e.g. nurse practitioners & PA’s) and pay them less than doctors for the services they render. Total health care cost reductions have not occurred as the number of these mid-level providers have increased.
Finally, as you review statistics in other countries, don’t overlook the fact that you are not comparing ‘apples-to-apples’ healthcare systems. Many of the countries you mention mandate reduced demand by rationing care and services. Nor am I sure that citing studies from the 1970′s is particularly relevant today. In the 1970′s, Medicare was in its infancy and third-party payors were virtually non-existant. Common sense dictates that when you provide third-party payment of any desirable service at a significantly reduced ‘real cost’, you will dramatically increase the demand for it.
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