My Chicago-area brother & I engage in a friendly competition over whose political culture is more entertaining. It is a contest I would like to lose, although my hopes have been dashed in recent months. Even with former governor Rod Blagojevich competing in the new season of The Apprentice (begins Sunday!), New York is winning handily. The best capsule summary goes to Baruch’s Doug Muzio who dubbed New York politics “Rod Serling meets Lewis Carroll.”
The financial problems of the nation and many large states—California, Illinois, New Jersey and certainly New York—present a problem that is challenging economically and hazardous politically. Since it’s impossible to separate the economics from the politics, it is truly a Gordian knot – rather than untying the knot, Alexander the Great sliced the Gordian knot in two with a single, bold stroke of his sword.
The Congressional Budget Office forecasts the federal deficit to decline from about $1.5 trillion in 2009 to $608 billion in 2014, then rise to nearly $800 billion in 2020. This is a hefty deficit, particularly when you consider that we had a surplus as recently as 2000. Then consider that the cumulative public debt, which currently stands at $7.5 trillion, is expected to nearly double by 2020 to $14 trillion.
The Center for Governmental Research has begun a partnership with the Rochester City School District. We’ve been invited to support implementation of Superintendent Jean-Claude Brizard’s Five Year Strategic Plan.
I’m a planning skeptic. Often the process of planning is so exhausting that we declare, “It’s done!” when the ink is dry. We forget that the plan serves only to lay out the course and load the starter pistol. The plan is too-often ignored. We continue going about our tasks as though nothing had changed. To the Superintendent’s credit, many of plan’s strategies codify activities already underway. In fact, the first of the five years was 2008-09. Like all good leaders, Brizard is impatient about his plan.
Early this year I wrote about the high deductible health plan (HDHP) and health savings account (HSA) being offered to CGR by Excellus. A look-back seems timely.
Five of us at CGR signed up for the HDHP and HSA combination. With our experience as background, nearly the entire staff selected this option for the coming year. Why?
Congress is edging closer to passing legislation that restructures health insurance. The Senate and the House are debating compromise bills within their houses, after which a conference committee will seek to reconcile differences between them. With these details still under debate, we conclude our six part series on health reform with a few observations.
Public Option. If private insurance plans are part of the problem, then one solution may be to offer another option, a health insurance plan that is run by the government. At this writing, a “public option” seems likely to survive and become part of the final legislation. The debate over the public option has highlighted a fundamental social tension between those who fear too much government and those who fear too little (discussed in the first column in this series). Like Goldilocks, each of us wants the balance to be “just right.”
In this column, we address the challenge of expanding health insurance coverage. First, we explore why our employer-based system leaves gaps in coverage, even for people with jobs. Second, we discuss the challenge of relying on the individual insurance market, which has to fill these gaps.
In April, Kent wrote of a woman who had signed up for a “consumer-directed health plan.” While the plan saved her money, she yearned for days when she didn’t have to think about the cost of a doctor’s visit or a prescription.
Traditional health insurance insulates us from the visit-by-visit, script-by-script cost of care. That’s a problem. Facing only a fixed co-pay (or not even that), we don’t look at the “right side of the menu.” In our health care “restaurant,” the menu doesn’t tell us that the Lobster Thermidor costs twice as much as the Chicken Piccata. And we don’t care, because “insurance” will pay for it.
Last week we explored regulatory approaches to slowing health care spending growth. Today we discuss changing the incentives for consumers, providers and insurance markets.
There is a speechwriter in Washington who smiles each time someone says “bending the cost curve.” “Cutting health care costs” may be unattainable but “bending the curve” is essential.
To summarize our first two columns: Cost lies at the heart of the health care problem. Health care insurance masks the price signals that guide buyers and sellers. Providers are paid to do more and consumers have little incentive to refuse (go to www.cgr.org and click on the Policy Wonk link to read the first two).
In this column and the next, we look at ways to tame cost growth.
Welcome to the second in our series on health care. (If you missed the first one, check it out at blog.cgr.org.) Today we discuss the growth in health care cost, both how much and how fast it has grown, and the reasons. Next week’s column will focus on ways to reduce health care costs—or, more realistically, to slow the rate of growth.
In 1960, health care spending was 5% of gross domestic product (GDP). This year it’s expected to reach about 18%. For the past 30 years, health care cost has been rising 2% faster than GDP.
On the one hand, perhaps this doesn’t matter. We are spending more on health care and sometimes we get more for our money. Medical science has discovered new therapies. Pharmaceutical companies have identified fabulously successful new drugs. The survival rate for many dread diseases has increased significantly. For example, many cancer sufferers are living longer and experiencing a higher quality of life. Some diseases that were fatal only a few years ago—AIDS is the most prominent example—are now considered almost chronic illnesses. But these new therapies, these new drugs, these new treatments aren’t cheap. Genentech’s Avastin, currently used for a broad range of cancers, can cost from $4,000 to $9,000 per month.
You, too, can be fluent in Health Care! In only 10 easy audio lessons, you can amaze your friends with your command of phrases like single payer, health co-operative and rescission, plus acronyms like ERISA, LOS, IPA and HIPAA. Available on CD or by MP3 download for 10 easy payments of only $29.95.
Tempted? We’ll be attempting a similar feat over the next four weeks. Jim Fatula and Kent Gardner will be offering a “back to basics” look at the debate over health care reform. Two core issues—health care cost and health insurance coverage—occupy center stage.
Visiting Washington this summer, Kent watched a session of the Senate and listened to a member’s passionate speech on this subject. Yet he spoke to an empty chamber. Only one other senator was present. Oh, and C-SPAN’s camera, focused only on him. It seemed a metaphor for what has been a sorry debate, filled with speeches but few discussions. Radicals on both ends of the spectrum are driven more by ideology than by thoughtful differences in policy. This is a war between different faiths, a bitter competition between tribes in which winning is the only goal.
My Chicago-area brother & I engage in a friendly competition over whose political culture is more entertaining. It is a contest I would like to lose, although my hopes have been dashed in recent months. Even with former governor Rod Blagojevich competing in the new season of The Apprentice (begins Sunday!), New York is winning handily. The best capsule summary goes to Baruch’s Doug Muzio who dubbed New York politics “Rod Serling meets Lewis Carroll.”
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