|What makes medicine efficient? In Japan, it's rigid cost control|
Even if government pays the bills, it doesn't have to do the hiring, assigning and prescribing.
I am at the age when it is important to pay attention to PSA levels.
Elevated prostate-specific antigen levels can be a sign of prostate cancer. Over the past few years several of my friends have been diagnosed with prostate cancer, so I am sensitive to this topic.
That is one reason a front page story last week in The New York Times caught my eye: "In Health Reform, a Cancer Offers an Acid Test."
The article discussed the significant cost differences of the four common treatments for prostate cancer. The cost ranged from $2,400 for "watchful waiting" to $51,000 for a new radiation treatment called IMRT.
There is apparently no medical evidence to suggest that watchful waiting isn't just as effective as an IMRT. However, Medicare or private insurance will pay for whichever procedure one's doctor prescribes.
The point of the story was that most of the attention in the current health care debate has been about making sure everyone has insurance. Very little attention has been given to how to control the soaring costs of health care.
Just adding a public health care option will do little, by itself, to control costs. After all, we already have a public plan for those over 65, Medicare, and its cost increases threaten to bankrupt the country.
President Obama is looking to Congress to develop a plan that will cover all Americans at a cost that will not inflate our already bloated deficit. So far the efforts of the House and Senate are not encouraging.
The House is developing a plan that would provide universal coverage with an essential benefits package at a cost that is estimated to be $600 billion over 10 years. The plan would be financed by cuts in Medicare and Medicaid and higher taxes for both upper-income taxpayers and employers.
The House plan also includes a "public option" based on Medicare which would compete with private insurers.
The Senate plan would also bring universal coverage, but at a cost of $1 trillion over the next 10 years. It would be paid for by cuts in Medicare and Medicaid and a significant assessment for married couples whose income is over $350,000.
The latest information is that this assessment would start at 1 percent of adjusted gross income and go up as income rises. This would be a much more onerous tax increase than that contemplated by the House, and adds new color to the term "soaking the rich."
In the only significant attempt at addressing the cost issue in either plan, the Senate is considering adding a provision for nonprofit health co-ops. The co-op idea comes from a small plan that has been quite successful in the Seattle area.
It would seem to be almost impossible to scale up to any significant degree. Moreover, it is not clear how effective the model can be in controlling costs. Nonetheless, the Senate is desperate for something to address the cost issue.
Perhaps Congress should look to the Japanese model. The Japanese have the longest life expectancy in the world and a universal health care system, and spend half of what we spend in the United States.
Japanese go to the doctor three times more than Americans and they use modern technology just as much, if not more, than Americans. Moreover, hospitals and doctor's offices are mostly privately run, and Japanese are free to choose whomever they want to provide health services.
How do they manage to do all this? By means of a Japanese Health Ministry that tightly controls costs.
In Japan, it is a "single-payment system" rather than a "single-payer system." Every two years the Health Ministry negotiates a fixed price for every medical procedure and drug. Once the price is established, it is universal and non-negotiable. It works.
Can you imagine this in the United States? Why not? The Japanese approach highlights the key ingredient so far lacking in Congress's proposals – a way to control costs.
Unless Congress is willing to address the cost issue in a more serious way, even considering a less draconian version of the Japanese approach, it may be better to defer the issue of universal health care.
The stakes are enormous, and a bad plan would be worse than simply continuing the current system until a workable approach to cost control is agreed upon.