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Health Care Confidential .pdf



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Title: Jeff Weintraub: Paul Krugman - Health Care Confidential
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Jeff Weintraub: Paul Krugman - Health Care Confidential

Seite 2

As a result, the Republican Congress managed the impressive feat of
slapping together a program that combines extravagantly wasteful expense,
inadequate coverage, and maximum confusion. As everyone knows, the
introduction of Medicare prescription drug program has been attended with
precisely the kinds of chaos and inefficiency predicted by serious and
intelligent analysts when the bill was originally passed. Some apologists
have suggested that this kind of confusion and dislocation is just inevitable
when any big new government program is introduced. But as Jonathan
Cohn pointed out in the New Republic (posted 1/19/06), this is no more
than a flimsy excuse. A simple comparison makes this clear.
But consider what happened when the Johnson administration
rolled out Medicare for the first time in July 1966. Back then, the
obstacles were even more daunting than they are today. Rather
than simply adding a benefit for a relatively narrow class of
services (prescription drugs), introducing Medicare meant
establishing an entirely new insurance program in just eleven
months. [....]So what happened on the day that this complex
program was implemented? Thousands of senior citizens simply
went to the hospital and got the health care they needed.
This isn't surprising, considering that the administration designed
its Medicare plan to serve its ideological agenda--privatizing
government services and enriching special interests like the
insurance and pharmaceutical industries--rather than senior
citizens.
[For a useful elaboration of the last point, see this New
Republic editorial.]
Krugman would like to close his column on an optimistic note:
Still, ideology can't hold out against reality forever.
It would be nice to think so. (Meanwhile, read the whole column.)
--Jeff Weintraub
========
New York Times
January 27, 2006

Health Care Confidential
By Paul Krugman
American health care is desperately in need of reform. But what form
should change take? Are there any useful examples we can turn to for
guidance?
Well, I know about a health care system that has been highly successful in
containing costs, yet provides excellent care. And the story of this system's
success provides a helpful corrective to anti-government ideology. For the
government doesn't just pay the bills in this system — it runs the hospitals

http://jeffweintraub.blogspot.com/2006/01/paul-krugman-health-care-confidential.html

29.03.2011 17:24:23

Jeff Weintraub: Paul Krugman - Health Care Confidential

Seite 3

and clinics.
No, I'm not talking about some faraway country. The system in question is
our very own Veterans Health Administration, whose success story is one of
the best-kept secrets in the American policy debate.
In the 1980's and early 1990's, says an article in The American Journal of
Managed Care, the V.H.A. "had a tarnished reputation of bureaucracy,
inefficiency and mediocre care." But reforms beginning in the mid-1990's
transformed the system, and "the V.A.'s success in improving quality, safety
and value," the article says, "have allowed it to emerge as an increasingly
recognized leader in health care."
Last year customer satisfaction with the veterans' health system, as
measured by an annual survey conducted by the National Quality Research
Center, exceeded that for private health care for the sixth year in a row. This
high level of quality (which is also verified by objective measures of
performance) was achieved without big budget increases. In fact, the
veterans' system has managed to avoid much of the huge cost surge that has
plagued the rest of U.S. medicine.
How does the V.H.A. do it?
The secret of its success is the fact that it's a universal, integrated system.
Because it covers all veterans, the system doesn't need to employ legions of
administrative staff to check patients' coverage and demand payment from
their insurance companies. Because it's integrated, providing all forms of
medical care, it has been able to take the lead in electronic record-keeping
and other innovations that reduce costs, ensure effective treatment and
help prevent medical errors.
Moreover, the V.H.A., as Phillip Longman put it in The Washington
Monthly, "has nearly a lifetime relationship with its patients." As a result, it
"actually has an incentive to invest in prevention and more effective disease
management. When it does so, it isn't just saving money for somebody else.
It's maximizing its own resources. ... In short, it can do what the rest of the
health care sector can't seem to, which is to pursue quality systematically
without threatening its own financial viability."
Oh, and one more thing: the veterans health system bargains hard with
medical suppliers, and pays far less for drugs than most private insurers.
I don't want to idealize the veterans' system. In fact, there's reason to be
concerned about its future: will it be given the resources it needs to cope
with the flood of wounded and traumatized veterans from Iraq? But the
transformation of the V.H.A. is clearly the most encouraging health policy
story of the past decade. So why haven't you heard about it?
The answer, I believe, is that pundits and policy makers don't talk about the
veterans' system because they can't handle the cognitive dissonance. (One
prominent commentator started yelling at me when I tried to describe the
system's successes in a private conversation.) For the lesson of the V.H.A.'s
success story — that a government agency can deliver better care at lower
cost than the private sector — runs completely counter to the proprivatization, anti-government conventional wisdom that dominates
today's Washington.

http://jeffweintraub.blogspot.com/2006/01/paul-krugman-health-care-confidential.html

29.03.2011 17:24:23

Jeff Weintraub: Paul Krugman - Health Care Confidential

Seite 4

The dissonance between the dominant ideology and the realities of health
care is one reason the Medicare drug legislation looks as if someone went
down a checklist of things the veterans' system does right, and in each case
did the opposite. For example, the V.H.A. avoids dealing with insurance
companies; the drug bill shoehorns insurance companies into the program,
even though they serve no real function. The V.H.A. bargains effectively on
drug prices; the drug bill forbids Medicare from doing the same.
Still, ideology can't hold out against reality forever. Cries of "socialized
medicine" didn't, in the end, succeed in blocking the creation of Medicare.
And farsighted thinkers are already suggesting that the Veterans Health
Administration, not President Bush's unrealistic vision of a system in which
people go "comparative shopping" for medical care the way they do when
buying tile, represents the true future of American health care.
POSTED BY JEFF WEINTRAUB AT 12 :04 PM

http://jeffweintraub.blogspot.com/2006/01/paul-krugman-health-care-confidential.html

29.03.2011 17:24:23


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