Driving Affordable Health Care Over A Cliff

[ED. UPDATE: Sen. Daschle will be stopping by a little later to respond to your comments. Sen. Daschle got tied up today, but we are going to reschedule a time soon for him to answer your questions on this topic.]

We face a major crisis in this nation. Our health system is collapsing. We now spend a record-high 16 percent of our economy on health care. Premiums have risen by 73 percent since 2000. And businesses now spend nearly $450 billion on health benefits – not counting their Medicare payroll taxes. In a few short years, the health costs of Fortune 500 companies will exceed their profits. Despite these costs, the U.S. ranks 34th on life expectancy, 41st in infant mortality, and 37th, according to the World Health Organization, in health system performance. In short, we need fundamental change.

The problem is not a lack of ideas. It is a lack of leadership. The only answer that the President has to this crisis is so-called consumer-driven health care. This means shifting costs to people through high deductibles, and shifting risk and responsibility to patients.

This is a bad idea for three reasons:

1. It makes the wrong assumptions about health care. A person with chest pain is not in a position to decide on which tests to take and what drugs he needs. A $1,000 deductible is not going to make a person switch hospitals to get an extra hour of hospital care, which is all that the deductible can buy. Health care is not a commodity. When we buy a car, we don’t want to have the parts dropped off on our front lawns. Consumer-driven care just doesn’t make sense for health care.

2. It assumes that individuals can go up against industry and win. Look at the Medicare drug benefit. My mother has to choose from 73 plans. It is impossible for her to figure out which has the lowest prices. Rather than pooling the purchasing power of seniors to leverage lower prices, this drug benefit allows for drug companies to charge higher prices and insurers to profit. So, if you like the Medicare drug benefit, you will love consumer-directed health care.

3. It pits the healthy against the sick. About 70 percent of costs in the U.S. health system are for the top 10 percent most expensive people. These people’s costs are well above the deductible, so a high deducible won’t change their behavior.

Consumer-directed health care is not the answer, and it will make matters worse. Instead, we should embrace comprehensive health reform based on four simple pillars. It should provide affordable health care for all Americans, ensure choice of doctors and plans, contain costs, and prioritize prevention.