David Cutler argues that health care reform will save money. There are certainly ways to spend health care dollars more efficiently. We should concentrate more on primary care and preventive care. This does not mean this will save money, at least for many years, as I’ve discussed previously. It will cost money to provide preventive care services and it will cost money to provide care for those who are now uninsured. It will take quite a bit longer than a decade to see any meaningful cost savings from such health care reform. The Obama administration really over-estimates the value of health information technology and under-estimates the difficulties in getting systems in place which will actually turn out to be of value.
There are many reasons why we should reform health care, and there are certainly societal benefits to improving preventive care and improving access to health care, but arguing it will save money is a bogus argument for health care reform. If the country wants increased health care services we are going to have to pay more for them. Fortunately many polls do show that a majority of voters are willing to pay higher taxes if it means more affordable health care and no longer fearing the loss of coverage. If only the politicians had the courage to admit it will cost money and discuss where it will come from.
It’s going to be interesting see whether the Obama administration tries to make a version of this argument to pass a health-care reform bill — and whether the Congressional Budget Office, which will be responsible for coming up with the all-important budget number for the bill, will buy the argument.