There’s already been a lot of criticism of John McCain’s health care plan around the liberal blogosphere, including these posts from Steve Benen and Ezra Klein. One peculiar thing about McCain’s plans is that he manages to both ignore addressing the real problems of those who have lack affordable coverage and makes things worse for those who do.
McCain does briefly mention the problems of those who cannot obtain affordable insurance in the individual market but offers no real solutions. This is where the most serious problems arise. There are certainly problems which need to be addressed for those who receive coverage through employers, but those having the most serious problem are those who have to buy insurance on their own, especially if they are older or have illnesses which the insurance companies would prefer to avoid covering. Not only does McCain fail to address these problems, but he wants to throw even more people into the individual market by taking away employer supplied health care. The tax breaks he offers to individuals will hardly replace their coverage, or allow those without coverage to be able to afford it.
Not only does McCain’s plan manage to make matters worse for those with employer-paid insurance, but he also wants to worsen coverage for those on Medicare. He is very vague but whenever he has spoken about Medicare he describes a plan which sounds like moving from fee for service to a capitated plan. Fee for service is far from perfect as it includes incentives to perform too many procedures if each is paid individually, but as Winston Churchill has described democracy, this is the worst form except the others which have been tried.
Megan McArdle criticized McCain’s plan by writing:
The problem is, it’s heavier on theory than practice. Every health care economist in the country wants to pay for health rather than treatments. The problem is, health is very hard to measure–as David Cutler told me, “Health care and education are the two fields where output is hardest to measure. It’s not surprising that costs in those areas are increasing much faster than inflation.” When output can’t be measured, input will be.
Medical care, like education, is also dependent on inputs from the clients. You will have a frantic political battle from doctors against any proposal that makes their income dependent on how many of their diabetics really give up the corn chips.
Capitated plans which pay a fixed amount per patient as opposed to paying for each procedure have been a disaster. They have had mixed results when dealing with young, healthy patients but have been a failure in dealing with elderly patients. Megan is correct that one problem in payment based upon outcomes is that factors such as noncompliance with medical advice increases the cost. If we must deal with a noncomplaint patient who winds up developing more problems we naturally expect to be paid more for the extra work–not less as under McCain’s plan.
The problem goes beyond matters of compliance. In the Medicare population, elderly patients with chronic medical problems inevitably age and get worse. Or else they die. McCain’s plan encourages health care systems to avoid covering people as they get older and sicker, or to allow them to die. Naturally doctors who would prefer to treat sick patients tend to feel uncomfortable dealing with such plans–and patients should feel even more uncomfortable with such a system.
Changing Medicare in such a way would also greatly exacerbate the problem of a shortage of primary care physicians. Capitated plans typically pay primary care doctors a set fee per patient but are more often forced to pay specialists, who often are not involved in the case on a continuing basis, on a fee for service basis. Such a change in Medicare will make doctors even more reluctant to practice primary care. Instead they would prefer to be the cardiac surgeon who is still paid well for doing the bypass surgeries for the patients who require heart surgery because they could not afford or find sufficient primary care and preventative services.
Democrats who have proposed changes in health care have often faced scare tactics from the right. As the vast majority of people, rightly or wrongly, are happy with their insurance coverage, it has been effective to make people fear that change means losing what they now have. McCain’s horrible health care ideas provide an opening for Democrats to now win this debate as it is McCain who proposes making things worse for those who now have employer-paid insurance or Medicare.
