Margolis: A grand social experiment played out with sound bites, slogans and assertions

A Fletcher Allen doctor watches during the health care bill signing. VTD/Taylor Dobbs

A Fletcher Allen doctor watches during the health care bill signing. VTD File Photo/Taylor Dobbs

Editor’s note: Jon Margolis is VTDigger.org’s political columnist.

For at least two reasons, perhaps the most politically effective statement Randy Brock made in his first debate with Gov. Peter Shumlin was that the Shumlin health care plan makes Vermonters “lab rats in a grand social experiment.”

The two reasons are: (1) Nobody wants to be a lab rat; (2) It’s true. The Shumlin plan is an experiment. Otherwise, the Green Mountain Care Board established by the Legislature wouldn’t be laboring so hard trying to figure out how to make the proposed universal health care plan work.

Brock has a health care plan, too. It’s very different from Shumlin’s. It relies far more on the private sector. It provides individuals more choice, but also burdens them with greater responsibilities.

But you know what else it is? It’s a grand social experiment.

So, in the view of many experts, is the health care status quo. The present system keeps getting more expensive without making people much healthier and without covering everyone. Liberals and conservative fight over how to fix the system, but agree that it is unsustainable.

They also agree that it is “wicked complicated,” in the words of Anya Rader Wallack, chair of the Green Mountain Care Board. Slogans and sound bites, then, are more likely to confuse than to clarify. So are unsupported assertions.

But in the health care debate most of what Vermonters are hearing in the political campaign consists of slogans, sound bites, and unsupported assumptions.

On his campaign website, for instance, Brock states that “the power of individual consumers and the free market can drive the transformational change needed, just as they have done in every other aspect of the American economy.”

Well, maybe they can. But then again, maybe they can’t. For almost half a century, since an influential article by economist Kenneth Arrow (later a Nobel prize winner) in the American Economic Review, the prevailing – though not unanimous – view among health care economists has been that health care is different, an exception to the widely shared view that goods and services are best provided by the private, for-profit sector. In this view, health care is less like automobiles, sewing needles or restaurant meals and more like higher education. For-profit universities such as Devry or Phoenix may be just right for some students. But they are not on the level of such great public institutions as the University of California/Berkeley or private non-profits like Harvard.

Those economists might be wrong and Brock could be right. But he didn’t explain why he might be right. He just asserted it.

Nor has anyone yet challenged him or Shumlin to back up their assertion. On WCAX-TV (Channel 3) the other day, Shumlin, on the telephone with a reporter, said, “Randy Brock’s proposal for health care will raise rates 200 percent to 300 percent on those who really need health insurance and give the for-profit industries more profits.”

It seems not to have occurred to the reporter to ask the governor just how he got that estimate.

OK, TV news has its time constraints. Every news story can’t thoroughly plumb the depths of every issue. But some of them can try to relate what candidates claim to reality.

There is actual information about health care. There are examples of what works and doesn’t work elsewhere. There are data. There is, in other words, such a thing as social science, which as much as possible should be part of the public policy discussion, including the political discussion.

On the assumption that one good way to determine whether a policy will succeed here is whether it has succeeded anywhere else, one obvious question about health care that should – but has not – been posed to both candidates is: Where else does your plan or something like it work?

It’s an easier question for Shumlin and his allies. Canada, most of Europe, Japan, Israel, Costa Rica and other countries have the kind of mandatory, universal, government-run – or at least government-controlled – health financing system the governor wants Vermont to adopt.

That is by no means proof that it will work here. Unlike, say, France, Vermont is not sovereign. Officials in Montpelier have less control over the state’s health care system or its economy than do their counterparts in Paris.

Brock and his fellow health care conservatives have a harder time with the “where else” question because the answer appears to be … nowhere.

“So far as I know, Switzerland may come the closest, though I’m not sure how close,” Brock said (via email).

Not very. As in the Netherlands and a few other countries, Swiss health care is provided by for-profit insurance companies. But the system is universal, mandatory, subsidized and heavily regulated. The companies can not refuse to insure anyone or charge sick or old people more than healthy young ones. Also, the companies may not earn a profit on the basic, required health care, only on the supplemental care most Swiss purchase. In all these countries, the system is closer to the new Affordable Care Act (ACA, aka “Obamacare”) than to a free market purist’s paradise. And while those systems seem to work, health care in Switzerland and Holland is more expensive than in most European countries.

Brock has also praised recent health care changes in Maine, which has instituted a more market-based, less regulated, health care system. Brock’s health care proposal would “allow Vermonters, like residents of Maine, to buy insurance from licensed insurers, in any state in New England.”

Actually, that part of Maine’s system is not scheduled to go into effect until 2014, said Joe Ditre, the executive director of Consumers for Affordable Health Care, and when it does Maine residents will not be permitted to buy policies from Vermont. The changes that have taken effect have increased health care premiums for most customers of the state’s largest health care plan (the only one to report its results so far) without increasing their benefits, said Ditre.

Health care experts also question whether opening an inter-state health insurance market will hold down costs, at least not unless consumers are allowed to buy policies providing less coverage. Less coverage could mean lower costs, but also less health care, as customers put off care because their out-of-pocket “deductible” would be too high.

Brock pointed to a Rand Corporation study indicating that some “who enroll in high-deductible health plans are at no more risk for cutting back on needed health care than other(s).” But another Rand study found that while high-deductible plans “significantly cut health spending, they also prompt patients to cut back on preventive health care.”

Not that the Shumlin plan for controlling health care cost increases is guaranteed to work, either. At the heart of its cost-control effort is converting the dominant payment system for health care from “fee-for-service,” to some kind of “bundled payment” or “universal” payment system that pays teams of health care providers to keep people healthy rather than just “fix people when they’re sick,” as Wallack put it.

Asked for documentation that this shift would hold down costs without degrading treatment, Wallack emailed a document listing 30 academic or foundation studies indicating that, as one put it, “bundled payments show substantial promise for delivering savings and improved quality.”

But, she acknowledged, there are other studies, some from comparably respected scholars, that reach more ambiguous conclusions. The effort to cut costs and improve care, she said, will not stop once Vermont adopts its new health care system.

“Monitoring is extremely important,” she said, and it will continue to be. Fortunately, she said, “the status and ability of data systems is much better than it was 20 of 25 years ago. We’ve seen movement to models where providers are going to be held accountable.”

Brock argues, correctly, that Shumlin still can’t say what his plan will cost. But neither can Brock, some of whose proposals would also cost money. In fairness to Brock, he is running a relatively shoe-string campaign which can not afford a battery of issue researchers. In an interview, he said he made a “back-of-the-envelope estimate” that one of his proposals –a tax credit for some health care premiums – would cost only about $2.7 million a year.

There are credible arguments on behalf of a more market-oriented approach to health care. Brock mentioned a new book by John C. Goodman called “Priceless: Curing the Health Care Crisis.” Goodman’s proposals are being taken seriously – even as they are criticized – by the liberal health care website, “The Incidental Economist.”

In other words, Randy Brock can support his sound bites, slogans and assertions with examples and data. So, no doubt, can Gov. Shumlin. It’s not their fault that nobody has demanded that they do so.

Jon MargolisJon Margolis

Comments

  1. Dan McCauliffe :

    We could all learn more by looking at what seems to be working best in other countries that offer universal access to health care. From what I have learned, mixed payer systems trump single payer systems. In the 2010 Euro-Canada Health Consumer Index, Canada’s single payer health system ranked poorly compared to many of the mixed payer systems in Europe. Canada ranked 25 out of 34 countries. The 2012 Euro Health Consumer Index is available, but didn’t include Canada. However, there is still much to learn from this latest analysis. The results of this latest study show how consumer empowerment, and abandoning the single payer model leads to better health care system results. From the press release of the report: http://www.healthpowerhouse.com/files/ehci-general-press-release.pdf

    “No doubt, the Dutch wins for the third consecutive time – and with a growing margin, explains Dr. Björnberg. Their healthcare seems able to deal with new conditions and delivers top results. Since the start of Dutch reform in 2006 there has been radical improvement. Consumer empowerment, treatment outcomes, the range and reach of the system, use of pharmaceuticals are on top – but accessibility could be better!

    In spite of rising costs the healthcare in the Netherlands belongs to the top also measured value for money! This is an example for European countries to follow, not least by abandoning poorly working single-payer systems.

    And from the full report: http://www.healthpowerhouse.com/files/Report-EHCI-2012.pdf

    “The Dutch have established a European model to copy – not least by abolishing single-payer systems.”

    The NL [Netherlands] is characterized by a multitude of health insurance providers acting in competition, and being separate from caregivers/hospitals. Also, the NL probably has the best and most structured arrangement for patient organisation participation in healthcare decision and policymaking in Europe. Also, the Dutch healthcare system has addressed one of its few traditional weak spots – Accessibility – by setting up 160 primary care centres which have open surgeries 24 hours a day, 7 days a week. Given the small size of the country, this should put an open clinic within easy reach for anybody.

    Here comes the speculation: one important net effect of the NL healthcare system structure would be that healthcare operative decisions are taken, to an unusually high degree, by medical professionals with patient co-participation. Financing agencies and healthcare amateurs such as politicians and bureaucrats seem farther removed from operative healthcare decisions in the NL than in almost any other European country. This could in itself be a major reason behind the NL landslide victory in the EHCI 2012.

    ………………………………………………
    The highly rated Netherlands’ mixed payer model is clearly not the future of Vermont’s Canadian type single payer system with bureaucratic top-down control, that disempowers patients and their providers in medical decision making. The above study was critical of the single payer systems for good reason: they do poorly compared to other universal health care systems such as the Dutch and Swiss systems. It should also be noted that Canada spends about the same on health care as do these two countries.

  2. Jon Margolis :

    Randy Brock did not say “So far as I know, Switzerland may come the closest, though I’m not sure how close.”

    He was so quoted thanks to confusion over who said what in an email exchange.

    Another reason to be wary of email exchanges.

    But the essential point remains valid. As Brock acknowledged in a subsequent interview, there is no real ‘free market’ health care system anywhere, though some — the mentioned Maine and the Netherlands — seem to be moving in that direction.

  3. Jon Margolis :

    As I should have made clear in my first message, the confusion over the email exchange was mine, not Randy Brock’s.

  4. Christian Noll :

    Its interesting listening to Americans talk about other countries health care systems which they themselves have never expereinced. Then we rely on our own incredibly biased media for our sources.

    Single payer is an experiment we must move forward with.

    The biggest risk of all, is not taking one.

    There should be no profit anywhere for anyone in American health care. The “profit” is a healthy and longer life. That’s the profit.

    • Dan McCauliffe :

      Christian,
      My quotes above were from a study conducted by a group in Sweden, not the US. This view from Europe is that the single payer model is not the model to emulate. Canadians acknowledge the problems with their government controlled single payer health care system, and their has been discussion to reform their system to be more like the better European systems. There is no doubt that our health care system needs to be changed. The question is how to best change it in a way that attains universal access while preserving high quality and timely access to affordable care. Although there is no perfect system, we would be wise to learn from the many experiments on health care reform in the European countries, to best avoid developing a more problematic system like the Canadian single payer system.

      • walter carpenter :

        “This view from Europe is that the single payer model is not the model to emulate.”

        No nation is trying to emulate are convoluted fiasco. None.

  5. David Dempsey :

    Your story points out the fact that the media in Vermont rarely ask the questions that would cut through the rhetoric and bring out the facts. Poitical candidates are allowed to say what they want without fear of having to account for their statements. More investigative reporting is needed to give Vermonters an accurate picture of the issues they report on.

  6. “Lab rats in a grand social experiment” is a fear generating inaccurate assessment of the Shumlin plan as there are already such plans in other countries we can study and base ours on. Whether it’s a pure “single payer” as in the U.K./Canada etc. or a hybrid that other countries use, similar to our Medicare, they all result in universal coverage at approximately 50% less in cost per capita and have better results. (Canadians, incidentally, live 3yrs. longer than us.) These plans, including Medicare, have existed for decades which hardly makes them experimental.

    So Randy and Jon, lets limit the hyperbole and exaggeration.

    • Paula Schramm :

      Jerry has it exactly right.

      Brock famously says : “the power of individual consumers and the free market can drive the transformational change needed “.
      The whole trajectory of his campaign against Vermont’s health care reform is to do whatever he can to push it away from models that work far more successfully than ours, towards something as “free market” as he can manage. He has no coherent vision, just latching on to whatever scheme that will serve for a time to further his argument for “free market”, in other words the best he can do for-profit insurance companies.

      He doesn’t go up close for a real look at the Swiss system, something you might think he’d be interested in doing if he truly wants a successful alternative to what we have.
      Why ? Read again :
      “As in the Netherlands and a few other countries, Swiss health care is provided by for-profit insurance companies. BUT THE SYSTEM IS UNIVERSAL, MANDATORY, SUBSIDIZED AND HEAVILY REGULATED”.
      In other words, not AT ALL “free market”.

  7. Al Salzman :

    With the startling news that the life expectancy of women who have not graduated from high school has declined by four years, the endless diversionary debates and studies-unto-death of health care reform take on a sinister meaning. As Elizabeth Warren puts it all we have to do is eliminate the words “sixty-five or over” in the Medicare Law to solve the problem. Here in Vermont the obfuscation grows with each statement about the ‘complexities’ and ‘entanglements’ of reform. The real ‘complexity’ and ‘entanglement’ is the suborning of our politicians by the private health care industry and the wealthy tax-freeloaders who fund them. If we connect the dots we’ll find the old picture of the one percent elite protecting their profits at the expense of the workers and the poor. Democratized health care as with economic justice is bound up with the state and federal tax structure. Governor Shumlin signaled his one percent position by refusing to support a sur-tax on the 190 million dollar windfall from the extension of the unconscionable Bush tax cuts. This decision put the Governor in the camp of those who would like to continue the price gouging, privatized health care system,his stated support of single-payer notwithstanding. I’m bracing myself for betrayal!

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