Health Care

Question 1

What is “managed care”?

Answer 1

Managed care ( or accountable care organizations) is a system in which doctors get one flat fee to treat someone - if you mess up and have to treat them more, it comes out of your pocket. Rewards are also given if you do a good job. The problem with this system is that it gives doctors/hospitals the incentive to turn down a “hard case” because it is hard to quantify a person’s diagnosis on paper and they could lose money. THey will also want to cut corners on treatment that increases cost to physicians.

Question 2

What is the conservative view of the uninsured problem in U.S.?

Answer 2

The problem of uninsured is because insurance is so expensive, but just because there is a problem does not mean gov’t should intervene.

1. only a small amount of uninsured people actually want insurance and cannot pay. Most don’t want to pay, are illegals, or don’t think they need it.
2. Typically people are not insured for very long - if a family is uninsured they usually regain in 5months
3. No health insurance does not equal no health care. Many uninsured are still getting treatment in emergency rooms, charity care, and pro bono doctors.

Question 3

What is the information asymmetry problem?

Answer 3

People assume the doctor knows best, so they do not argue and just get whatever expensive surgery he/she recommends.

Question 4

What do liberals say fuels healthcare inflation?

Answer 4

1. Information asymmetry
2. Fee for service medicine
3. Lack of emphasis on prevention
4. Greed
5. Advertising for pharmaceuticals

Question 5

Why is lack of emphasis on preventative care a problem?

Answer 5

If people do not have the money to go in for a check up they will wait and end up having a more serious problem that takes more money to fix and will have to go to the ER. However, preventative care is still expensive so it does not really save money. If you treat 5 cases of obesity you may only prevent 1 case of diabetes.

Question 6

What do conservatives and liberals agree on as fueling health care inflation?

Answer 6

1. Aging society
2. Fraud
3. Health of Citizens
4. Technology
5. Tax exclusion for employer provided insurance

Question 7

What is the fraud problem in health care?

Answer 7

$54 million was paid out by medicaid/medicare in fraud payments to doctors who didnt do procedures. People are also collecting medicaid benefits who don’t need it. It is a difficult problem to fix because the gov’t has to pay for inspectors to root out fraud. It also fixes fraud on a one-on-one basis which is expensive.

Question 8

What does the health of citizens in the U.S do to health care?

Answer 8

People in U.S. engage in risky behaviors (obesity, type II diabetes, smoking, shootings). A lot of the healthcare bill is consumed by treating chronic health problems such as obesity and diabetes.

Question 9

How do conservatives think we should fix healthcare cost inflation?

Answer 9

Conservatives think we should restrict the demand of health care. In the current system, when we consume health care we do not assume the whole of the cost because third party insurance pays for it. Therefore we have no incentive to consume less of it, we actually have an incentive to consume MORE. Conservatives believe that if we had to pay more out of pocket for health care people would shop around and consume less. It will create more competition in the health care market (such as will plastic surgery) .

Question 10

What is the aging society problem with health care?

Answer 10

American has an increasing amount of older people. Old people need higher/more healthcare. Much of the increase of medicaid and medicare spending is due to an increase in old people. 12% of population (elderly) accounts for 33% in perscription medicine spending.

Question 11

What do conservatives say fuels healthcare inflation?

Answer 11

1. Third party payments (insurance companies)
2. Malpractice insurance

Question 12

What role does technology play in health care inflation?

Answer 12

New treatments for progressive diseases are very expensive and our desire for state of the art treatments exceeds our ability to pay for them. Conservatives think we should “grin and bear it” it is worth it to have new medical technology that improves the value of life. Liberals think there is a large amount of wast of procedures not needed, other countries are living longer and spending less.

Question 13

What is the malpractice insurance problem in health care?

Answer 13

Lawyers can easily sue physicians, and do it often. In 2007 the total spending on health care malpractice was $30 billion. Doctors pay insurance on malpractice that ranges up to $10,000 - $200,000 a year. This also leads to doctors practicing defensive medicine so they don’t get sued by ordering extra (and expensive tests) even if they do not think they are necessary.

Question 14

What is the liberal view of the current health care system?

Answer 14

The U.S. health care system is inferior in comparison to other countries where even the poorest people get basic healthcare and they are able to keep the costs of care down. The U.S. allows private profit to be made by health industry as opposed to others who pay for doctors from government. They say people receive better care because the emphasis is placed on preventative medicine.

Question 15

Why is pharmaceutical advertising a problem?

Answer 15

It influences people to consume drugs they don’t really need. The U.S. is one of two countries that allow pharmaceutical companies to advertise.

Question 16

What is “American exceptionalism” in health care?

Answer 16

The U.S. is the only industrial country who does not provide healthcare as a right. We have a “free-market” health care system.

Question 17

What is the conservative view of U.S. health care?

Answer 17

They say universal health care does not equal universal access to health care. In other countries there are very long waiting times for procedures, in G.B. cancer patients wait on average 8months to get treatment.Our system is much faster for treatment. Healthcare spending is also rising rapidly in all other countries. Countries keep costs down by denying certain healthcare or having very long waiting lists and many of these other countries are actually moving away from universal health towards market options.

Question 19

Why is tax exclusion for employer provided insurance a problem?

Answer 19

If the company pays for your insurance, you do not get taxed on that income, which creates an incentive to consume healthcare (use the insurance). Conservatives believe this causes people to consumer more health care than is needed. Liberals see it as a lose in revenue to the federal gov’t. In 2011 it cost us $177 billion in tax revenue.

Question 20

Why is the American health care system called the “Accidental Healthcare System”?

Answer 20

1. It is a hodge-podge of private and government insurers that leaves 16% of Americans uninsured
2. Companies started to offere health insurance in WWII to evade price regulations so they could hire the best workers.
3. In 1943 the IRS ruled that health premiums were not taxable which created the employer based healthcare system we have today.
4. In 1965 LBJ created Medicare and Medicaid.

Question 21

What is the fee for service medicine problem?

Answer 21

Doctors and hospitals have an incentive to treat more and collect more fees. It is inherently inflationary - they will encourage you to get the most expensive surgery. Also, they are rewarded if they do not treat a person right the first time and that person has to come back to be treated again.

Question 22

What do liberals think about uninsured problem?

Answer 22

The number of uninsured in the U.S. (16.3%) is a crisis, economically and morally.

1. Patient dumping - hospitals find ways to avoid treating uninsured, people who cannot pay
2. The absence of univeraly health care is “peannywise and pound foolish”. It gives incentive to receive treatment in the ER, which is more expensive, rather than to get preventative care.
3. The absense of health care equals death. People who do not have health insurance are more likely to die prematurely.

Question 23

What are the differences between U.S. and other countries health care?

Answer 23

1. Others have universal health are which is paid for by mandatory premiums or government taxes
2. Others psend less per capita and per person than the U.S. They have limits on hospital and doctor charges and limit access to specialists and technology.

Question 24

What is cost shifting?

Answer 24

Hospitals bill more to peoplewith insurance to cover the uninsured who cannot pay their medical bills. People pay about $1,000 extra per policy.

Question 25

Why were ObamaCare and Clinton’s plan failures?

Answer 25

Both violated long standing rules in healthcare:

1. Most people like the care they already have
2. People are disgruntled with the costs of care - too high
3. People get more confused about the plans the more they hear about them.

Question 26

What do people think they want in health reform?

Answer 26

1. People think we should expand coverage to everyone who needs it - but they don’t want to pay for it
2. People give support to proposals based on how they benefit themselves as individuals
3. Public is very suspicious of plans and politicians, they are very distrustful of government ( 80% don’t trust gov’t to do the right thing)

Question 27

What does ObamaCare (PPACA) seek to do?

Answer 27

1. Seeks to reduce the number of uninsured through expansion of medicaid, individual mandates, and employer subsidies.
2. Tries to keep the status quo
3. Insurance regulation
4. Taxes and other funding

Question 28

What is the “Guaranteed Issue” in ObamaCare?

Answer 28

Starting in 2014, providers will be required to sell insurane to everyone even if you have a pre-existing condition.

Question 29

What is the individual mandate in ObamaCare?

Answer 29

Everyone must buy insurance whether you are sick or not (to compensate for the “guaranteed issue”). Otherwise the private health sector will go bankrupt.

Question 30

What is a “risk pool”?

Answer 30

People with pre-existing conditions will be put in group and will be given subsidized insurance paid for by taxes.

Question 31

How will ObamaCare be paid for?

Answer 31

1. Taxes will be increased on top 2% (medicare taxes) in 2013 and a second medicare tax on “unearned income”
2. Cadillac insurance policy tax starts in 2018. Create an incentive to find a cheaper plan.
3. Other small things such as a tanning salon tax and FSA (flexible spending accouts)
4. Penalty payments if you do not buy insurance - up to 25% of income. If company does not provide insurance for workers they have to pay $2-3,000 per uninsured employees.
5. Industry fees for medical equipment companies
6. Cuts to medicare advantage
7. Cuts to medicare providers
8. decreasing medicare

Question 32

What is the “Class Act” in ObamaCare?

Answer 32

It is a long-term care plan that allows people to purchase long-term plans through the government for people with alzheimers, dementia, etc. who have to stay at a long term care facility. However, the secretary of human health & security said the Class Act program is being cut because it won’t work.

Question 33

What is a Patient Centered Outcomes Research Institute (PCORI)?

Answer 33

It would perform “comparative effectiveness research” and issue a statement saying which is the most effective treatment. The probrlem is that the insurance angencies will use this data to deny coverage for procedures. Some treatments may be ineffective for the majority, but works on a small group of people. The worry is that it will impose a one-size fits all.

Question 34

What is the Independent Payment Advisory Board?

Answer 34

It will begin in 2018 to cut medicare spending and will be comprised of medical experts. If medicare spending exceeds GDP growth + 1%, the board will step up and propose ways to reduce spending. If congress does nothing about the proposed cuts in 30 days, they go into effect automatically. The president gets a veto over a congress override.

Question 35

Analysis of ObamaCare:

Answer 35

1 Coverage - the number of uninsured will decline from 16% - 4%.

2. Bending the (cost) curve - will it reign in health care costs? The cadillac tax is certain to have some effect on cutting back the health care costs. But doesn’t start until 2018 and unions may fight it out of congress.
3. Fiscal Responsibility - It will decrease the deficit by almost $140 billion in 10 years
4. Individual mandates - supreme court will be taking case of constitutionality of individual mandates.

Question 36

How would Conservatives reform health care?

Answer 36

Conservatives would like to give individuals more responsibility over insurance. They want health insurance to be ther to pay for adverse events, not routine doctor visits and over the counter medicine. It will make people more responsible for spending which will drive health care costs down.

Question 37

What are High Deductible Health Plans (HDHP) and Health Savings Accounts (HSA)?

Answer 37

They work to cover people beyond the deductible for adverse events. A higher deductible will equal more savings in long run. HSA’s can put money in tax-free to help cover daily expenses concerned with health care. You can take it out for other reasons but will have to pay a penalty, like an IRA.

Question 38

What is the 20/80 problem?

Answer 38

Most of what we spend on health care is spent on a minority amount of people.