Teton Transplant

I frequently hear that the Republican party is the party of “no” when it comes to solving the health care problem. Well, let’s review the situation in Washington.

The House Republicans have a 10-step plan that has been on their website for many months. They have introduced a bill for each of the 10 steps. Unfortunately, with one exception, none of the bills have ever made it out of committee. Apparently the legislator most responsible for leaving these bills languishing in committee is Representative Eileen Cody, Chair of the House Health Care and Wellness Committee.

The House Democrat’s plan? It’s “under construction” according to their website as of February 6th. (See screen shot below.)

Here is the irony, the only bill in the House Republicans’ Plan that has made it out of committee was HB 1383. Signed by Governor Gregoire into law in 2006, it allows the state to offer health savings accounts to state employees. According to Representative Doug Ericksen, a primary author of the House Republicans’ 10-step plan, the administration has refused to implement it, laying the blame to an incompatible computer system among other things. So four years and still no health savings account option for state employees.

I asked Ericksen what, if anything, is likely to get done this legislative session on health care. Not a lot it appears. He said a bill that will put more pressure on the administration to implement health savings accounts for state employees has made it out of committee.

The only other health care-related bill that has made it out of committee is HB 3015, which would authorize the Insurance Commissioner to enter into compacts with other states to permit the sale of small group health benefit plans across state lines. Ericksen says this is fine as far as it goes, but is too lenient in his view, since it is only optional. He would prefer to see a more forceful bill.

Here is the screen shot from the House Democrats’ website as of February 6th, 2010:

Some have argued that the reason Massachusetts’s voters rejected Obamacare (through their vote for Brown) was that they already have “their healthcare”.   As this Cato Institute Study by Aaron Yelowitz and Michael Cannon points out, most of them already had health insurance before RomneyCare, and are now paying more for it.   RomneyCare has only added about 5% more people to the insurance rolls, and insurance rates have gone up faster than the average in rest of the nation.   I’m told it is political suicide for a politician to admit a prior policy mistake, but it would be sure nice to see Romney (and Brown and other supporters) admit it.  How about it Romney? Just about every other leadership effort you have touched has turned to gold, but you missed with this one. Isn’t it time to admit the essential structure of Romney-care — fining people if they don’t buy insurance — doesn’t do anything to solve the problem with rising health care costs and indeed makes it worse?

Every time I pull out my credit card with the higher cardholder reward I fill a twinge of guilt that I am costing the retailer a bit more for the transaction — more than I benefit by the customer reward — and realizing also that I am doing my part to drive up retail prices for everyone. This article by Ron Lieber for the New York Times discusses some of the damaging effects of consumer rewards.

Health insurance is similar in the way that individuals optimizing their personal situation results in greater costs for all.  Once someone or their employer has paid their premium, they have no incentive to economize their use of health services, and their doctor advising them has a strong economic incentive to over-prescribe procedures (both for revenue and tort-avoidance reasons).  The foregoing is mitigated somewhat by co-pays and deductibles.  The result, which we have observed over the last several decades, is that health services are over-consumed, insurance rates increase the next year, and the cycle starts over.  There is nothing in Obama care that addresses this fundamental problem.  In fact, it seems designed to acerbate it.

I just returned from CES 2010, the annual conference in Las Vegas that showcases the latest developments in consumer electronics.  The Seattle Times has covered the conference extensively.

At the conference, a presenter on digital health developments made the point that, more and more, telemedicine and other technology will replace human interaction with doctors.  He said this will be necessary because there simply are not enough doctors to cover the baby boom generation as it ages.

It is no secret that extensive compilation and sharing of digital health data creates significant privacy challenges.  What may be surprising to some is that the privacy problem is not caused by the inability to keep electronic data encrypted and secure.  We can do that pretty well if we don’t need to share the data extensively.  The problem arises because we share parts of our information with so many people – doctors and nurses yes, but also pharmacists, insurance providers, employers to a certain extent, loved ones.  Moreover, much of what could be considered health information can be gleaned from all of the other electronic data that is gathered about us.

As we get deeper into the digital age, more and more of our life is recorded in “the cloud,” and that data is always accessible to someone.  This includes virtually everything we purchase (including, for example, the payments we make to hospitals and the prescription drugs we buy) and every place we go (including a doctor’s office, a rehab clinic, the gym, the emergency room).  Telecom companies know where our cell phone is at any given time.  Many of our assets – bank accounts, mortgage records, stock portfolios – only exist in an electronic entry somewhere.

One presenter recommended Privacy Rights Clearinghouse, a website that compiles information about privacy rights in the digital age and recommends ways to protect them.  For example, don’t give your pharmacist or insurance company permission to share your purchase data with other insurance companies.  (Databases of this information exist and some insurance companies share them with other insurance companies to help screen insurance applicants.)

Certainly we will apply technology and pass numerous laws to maintain our privacy and the security of our assets.  But I think addressing the problem will require more than just a matter of using passwords and signing release forms.  Socialization and establishing new mores is vital.  As technology changes society, our shared values and conventions need to change along with it.  What was once considered no big deal – say, sharing someone’s birth date – is now a big deal, and becoming more so all of the time.