'Sensible' Health Care Reform?'

The Washington Post has an editorial highlighting what they term "sensible" health care reform ideas from the liberal think tank, the Brookings Institution.

Some of the reforms suggested are apparently already being considered in Congress. But others should be. Here are a few of the ideas - some of which are actually based on market forces to lower costs:

Thus, the group endorses changes such as raising the tax on sweetened beverages to target obesity and offering premium rebates to customers who improve their health or eliminate risk factors. It argues for capping the amount of health insurance that employers can provide tax-free, "to encourage carriers to design and workers to choose more cost-effective coverage." It proposes overhauling Medicare payment practices to reward performance and promote preventive care, and it endorses an entity that could propose fast-track policy changes for Medicare and Medicaid.

Some of its suggestions are part of the pending legislative proposals, but too much has been left out or watered down. Among the more intriguing ideas is a thoughtful approach to malpractice reform: The group suggests creating "health courts with specialized expertise in medical liability"; shielding providers from lawsuits if they adhere to "evidence-based guidelines"; and establishing "a legal pathway for early communication, apology and compensation."

In addition, the group proposes a far more fundamental shift in Medicare than do any of the legislative proposals. It would impose differing levels of co-payments depending on the service; for example, those deemed of high value might require no contribution from the patient while services determined to be of lesser health benefit might carry high co-payments. And it would reform supplemental Medicare insurance to eliminate "first-dollar coverage," under which seniors have no incentive to limit the amount of care they obtain.

Some of these ideas are intriguing. Others are poppycock. But many of them are clearly more market oriented than what the liberals are offering in Congress.

The idea of paying doctors for performance has been suggested by the AMA. And the idea of taxing only a percentage of health insurance benefits is a lot better than taxing all of them. The malpractice reform proposal is also interesting in that such "health courts" would probably have put John Edwards and his psuedo-science trial lawyers out of business (although not capping judgments probably wouldn't help reduce malpractice insurance costs very much).

A real downer would be this proposed "entity" that would be able to "fast track" policy changes in Medicare and Medicaid. If it meant that new treatments and experimental drug therapies would be approved faster, then it might do some good. More likely, it will dictate what Medicare and Medicaid won't cover rather than what it should pay for.

But given the Sword of Damocles hanging over our heads with regard to out of control Medicare costs, there are some reasonable ideas in the Brookings paper for putting downward pressure on the price curve that should be examined more closely.

Hat Tip: Ed Lasky