TL: You’re right. Liberal supporters bet the family farm on it. They really do think that will happen. I think it’s an open question. But a lot of good thinkers here believe that probably won’t happen, and that the only thing that will really control costs is some government negotiation to push back on the power of providers, as you have in Britain. There’s no provision for that in the Affordable Care Act.
CS: It strikes me that if something can be done to bring costs under control, there’s a chance the Act will be successful. If it continues to push costs up or even if costs continue up irrespective of the act, then it’s at risk of failure and public rejection.
TL: What you have to realize is that one premise of the Act is to make patients shoulder some of the burden of reducing the cost of care. The hope is that if consumers use fewer services, that will push down the national health care tab. That’s what the bronze policy is designed to do, and that’s the trend in the employer insurance market as well. If you make people pay more of the cost sharing, with, say, a higher deductible—in some cases $10,000 or more—a family with a kid or two is going to think really hard before going to any kind of doctor as long as they have to pay those kinds of costs out of pocket.
CS: Do you think consumers will respond to that message? Will people weight those things rationally and say ‘I could have another MRI but it probably is not justified’ or ‘I could spend $10,000 on this treatment, but it’s only got a 60 percent chance of success.’
TL: Research has shown that people can’t discriminate between care that’s needed and care that’s not needed. Furthermore, people are not terribly engaged in their healthcare and still believe the doctor is king or queen, and they are very trusting and accepting. To some extent you have to trust your doctor. People will have a rude awakening when they find they may have to pay more out of pocket and that may deter them from getting care—some of which they might need. In the last year, people have not used as many services as they have in the past, and that has resulted in some downward pressure on prices.
CS: In other words, they may be forgoing care that they may need?
TL: It’s hard to know that. Unless someone reads a lot of studies and examines Pub Med and the stuff from NIH, how are you really going to know if something is necessary or unnecessary? The hope of both liberal and conservative policy makers is that people will be able to use marketplace approaches, that people will look at ratings and read up and do the things you do when you buy a car. But it may not work with healthcare. My view is that it won’t, because healthcare is fundamentally different from cereals and toothpaste.
Equity here, equity there
TL: Your system is more equitable than ours. Our system is not equitable, and it won’t be even when the Affordable Care Act is fully implemented. It may be equitable in the sense that, yeah, if you’re sick you can get insurance. But that doesn’t mean everyone will have the same insurance that will pay for all the care a person needs.
A bronze policy is probably going to be the most popular policy—it certainly is in Massachusetts, where some 52 percent of the people chose it, because the others are pretty darn expensive. That policy covers only 60 percent of your healthcare costs. The silver, gold, and platinum policies will cost more and cover more. Better coverage may give you better outcomes or better care. So in that sense, the system is far from equitable.
CS: How much do they cost?
Excellent conversation. I'm looking forward to Part 2.
#1 Posted by Tom Barry, CJR on Tue 9 Oct 2012 at 02:30 PM
TL: To come back to your point that the Act could become more popular as people see the benefits: Most Americans aren’t going to be affected by it. They will still maintain their employer-provided coverage, and that’s 150 to 160 million people. What those people are going to see is insurance with higher and higher deductibles and more cost sharing and higher premiums. They are going to find that they’re paying a lot more for less coverage. That has been happening aside from the Affordable Care Act.
Trudy, I disagree with you and agree with your British counterpart. Most Americans at some point, probably sooner than later, are going to benefit from the ACA reforms and in fact millions already have benefited. Almost everyone goes through a transition between jobs, and when they realize they have the security of not losing health insurance and they can get financial assistance if they need it to buy coverage, they'll understand and value the law. And if the state health insurance exchanges work as envisioned, everyone will quickly see that as a big improvement in buying insurance.
#2 Posted by Harris Meyer, CJR on Tue 9 Oct 2012 at 03:28 PM
Harris, possibly the most inimical aspect of the ACA is the degree to which it encourages "I got mine" among people who might ordinarily be less scusceptible to the syndrome. The legislation is certainly better than nothing for those who benefit from it, but certainly not for those many millions who don't and won't, or who benefit only marginally, because it serves --and was designed to serve -- as a bulwark against single payer or some other form of government-underwitten universal health care that actually would benefit everyone.
Instead, we have the formal enshrinement of class-based tiers of health care access and affordability, with opportunities for coverage and access varying dramatically between income groups and even among similar income groups depending upon geography.
#3 Posted by Weldon Berger, CJR on Tue 9 Oct 2012 at 09:06 PM