October 3, 2012 | Posted By Bruce White, DO, JD

The September 20, 2012, issue of The New England Journal of Medicine carried two Sounding Board pieces about recommendations to contain health care spending. One article is titled “A Systematic Approach to Containing Health Care Spending” was produced by nationally known health policy experts working in cooperation with the Center for American Progress.

About half of the 11 recommended solutions are not new, nor have they proven to be anything more than platitudes from the past. Among these recommendations are: (a) “accelerate use of alternatives to fee-for-service payment”; (b) “simplify administrative systems for all payers and providers”; (c) “make better use of nonphysician providers [such as nurse practitioners and physicians assistants]”; (d) “expand the Medicare ban on physician self-referrals”; and (e) “reduce the costs of defensive medicine.” Should one peruse any one of several books produced in the 1980s written by politicians and health system gurus – such as Alain C. Enthoven’s Health Plan (1980), Joseph A. Califano, Jr.’s America’s Health Care Revolution (1986), Victor R. Fuch’s The Health Economy (1986), and Rashi Fein’s Medical Care, Medical Costs (1989) – they would find the same recommendations. Also, not so curiously, all of these authors and many others agreed in spirit – in the 1980s – that health care spending “trends [then] could squeeze out critical investments in education and infrastructure, contribute to unsustainable debt levels, and constrain wage increases for the middle class.” This at a time when total health care spending was one-tenth of what it is today (health care spending in 1980 was $256 billon; health care spending in 2020 was $2.6 trillion).

Truly regrettable, four of the 11 recommendations offered by the Center for American Progress expert panel in the New England Journal article has absolutely no reasonable hope of being implemented in today’s health care delivery world: (a) “promote payment rates within global [spending] targets”; (b) “use competitive bidding for all commodities”; (c) “require full transparency of prices”; and (d) “leverage the federal employees program to drive reform.” Responding to just two of these possibilities with examples from failed state attempts to control Medicaid spending: (a) It has proven impossible politically to cap global health care expenditures. Witness the Oregon Health Plan from 1993 to 1997. (b) And, it will be very, very difficult to include both federal and state employees in the same health care insurance plan with other federally-funded Medicare and Medicaid plans without the government employees feeling that their options and services have been reduced substantially or curtailed significantly. Witness the TennCare debacle from 1994 to 2000 (TennCare was designed initially as a preferred provider organization to include Tennessee state employees as well as Tennessee Medicaid recipients. A few years after the program began, the state employees were permitted to opt out of TennCare and re-enroll in their insurance plans.).

No one disagrees with the premise that something drastic needs to occur with respect to health care spending if we as a Nation are to avoid calamity, but the “something drastic” remains unclear and illusive, even to the experts.

The Alden March Bioethics Institute offers a Master of Science in Bioethics, a Doctorate of Professional Studies in Bioethics, and Graduate Certificates in Clinical Ethics and Clinical Ethics Consultation. For more information on AMBI's online graduate programs, please visit our website.

1 comments | Topics: Affordable Care , Distributive Justice , Health Care Policy


James Finnerty, M.D, M.A

James Finnerty, M.D, M.A wrote on 10/23/12 5:26 PM

Hi Bruce,
This topic would make a great format for some sort of open forum at one of our Ethics Grand Rounds. I think we could all get really into it and see what our insights are.

Jim Finnerty

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