Wack: No free market miracles exist on healthcare reform


Looking over the smoldering wreckage of the recent healthcare debate, many more Americans and their elected officials appear to have a newfound liking for more affordable healthcare, giving Obamacare a reprieve.

One of the major challenges of healthcare reform comes from the complexity of multiple players with multi-billion dollar stakes in the business. Pharmaceutical manufacturers, hospitals, doctors and nurses, device manufacturers, insurers, employers, ancillary service providers and medical researchers all have an intense interest in what happens to their piece of the healthcare pie. Attempt a change and everyone will try to protect their piece of the pie.

Even the biggest fans of the Affordable Care Act concede it has imperfections. By broadening coverage before global cost controls were in place, it drives up total expenditures. That flaw was known, and the intent was always to continue making improvements like cost controls.

Interestingly, it’s almost impossible to contain costs while a large percentage of the population does not have coverage. Uninsured people still consume health care, and the way they obtain services is usually very expensive and inefficient. The cost of that care is distributed to all of us, either in higher premiums, higher taxes or bigger deficits dumped on our children to pay back later.

For example, people without insurance will avoid going to the doctor, even with a known medical condition. This usually results in gradual deterioration, until they are forced by a crisis to seek care, typically in the Emergency Department. Now the problem is worse, more complicated and almost certainly more expensive to treat. There may also be other problems that have arisen because of the lack of treatment for the first problem, like kidney problems with untreated diabetes, or heart problems from untreated high blood pressure.

Now that person has big bills, may be missing work, and may even lose their job, because of the untreated medical problem.

With preventative care, regular check-ups and care management, many of these problems can be avoided, but to get the proper care, a person needs to first have health insurance. Hence the need to broaden coverage as the first step.

Cost control is the far more difficult part of the problem. First, cost control means someone doesn’t get paid as much. This is why any talk about reducing premiums paid by consumers or employers without a simultaneous discussion about reducing costs is pure fantasy. Try to make the healthcare pie smaller and everyone reaches for their piece and points to the other players, saying, take theirs!

Second, cost control means changing how we deliver and pay for care, with more preventative services, more community-based care, fewer procedures and fewer hospitalizations. This hopefully results in healthier people, but then if we are paying for health and not sickness, how are providers paid? It requires big changes in incentives and compensation that we are only beginning to tackle.

Another dirty secret about healthcare reform is that there are no free market miracles that will save us. The healthcare economy is already mostly government funded, through Medicare and Medicaid, and the parts that are not rely on the regulations created by the government. Because most health care decisions are unplanned, it’s very difficult to shop, and the scarcity of useful information, as well as geographic limitations, make shopping very hard even when the decision is planned. When you need it, you go to the closest place you can, and use whatever provider is available. Not much shopping can be done when you are bleeding to death or having a heart attack.

There will always be private insurance and fees for service providers, but with every political failure, more radical reform becomes more likely. The sooner we get employers off the hook for supplying health insurance, and the sooner we implement effective global cost controls while improving quality of care, the better it will be for everyone. That will only happen by another round of comprehensive reform.

Dr. Robert Wack writes from Westminster where serves on the Common Council. He can be reached at rwack1@comcast.net.

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Wack: No free market miracles exist on healthcare reform

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