Meanwhile, Back In Massachusetts...

The Times describes the effort in Massachusetts to rein in their spiraling health care costs.  The gist is to move away from a fee-for-service model and force service providers to act like insurers by accepting a flat fee for patients and then managing their care:

Although important details remain to be negotiated, the legislative leaders and Gov. Deval Patrick, all Democrats, are working toward a plan that would encourage flat “global payments” to networks of providers for keeping patients well, replacing the fee-for-service system that creates incentives for excessive care by paying for each visit and procedure.

As a matter of economics, this at least aligns the incentives of the people writing the checks with the people ordering the treatments.  I think most folks agree that having a doctor order treatments subject to a patient's approval while a hapless insurer simply nods and pays the bills is not a system where either the doctor or the patient feels a great deal of pressure to hold down costs.

Now, Republicans calling for market solutions to the health care puzzle argue that empowered consumers will fill this cost-control role if they pay out-of-pocket by way of medical savings accounts.  Yet one wonders - these can be very complicated decisions often requiring expert knowledge,and made under trying circumstances. 

On the other hand, having a system where an insurance company, relying on its access to expertise and a vast library of patient outcomes, makes the medical decisions seems to be politically unacceptable (faceless insurance bureaucrats greedily coming between a patient and their doctor - ahhh!  Well, unless it is a state-run plan, in which case the faceless bureaucrats are government employees and its all good, at least in LibWorld.  I digress...)

So if no one wants insurance companies applying their expertise to opine on appropriate courses of treatment then either the patient or the doctor ought to be put in charge of the patient's health care budget.  But if, as in Massachusetts, the doctor is put in charge, then the doctor is being put in the role of the insurance company, managing a pool of patients and hoping that on average, their health issues and treatment costs allow the medical practice to make a profit.  I don't know how that could work with a small practice, where a couple of hard-luck patients could wipe out a doctor's college fund for his kids.  My guess is that doctors will affiliate into larger groups to share risk and patients.  Here is a clue on that point:

Massachusetts has had a model for global payments since 2009, when Blue Cross Blue Shield of Massachusetts, the state’s biggest health insurer, began experimenting with an “alternative quality contract” that pays groups of doctors and hospitals a set fee to work as a team in caring for patients. The plans cover about 613,000 people, or roughly two-thirds of Blue Cross members in health maintenance organizations, but none of those in preferred provider organizations.

IIRC, HMOs were an initial attempt to achieve something like this global payment concept.

Meanwhile, what does this mean for Romney?  Well, maybe spiraling costs make it easier for him to repudiate RomneyCare.  Maybe!  Romney's vision for health care reform post ObamaCare is at his website.

Comments

[Annoying Old Guy]

Of course, the one thing we must never ever do is let consumers choose which of these works best. We must, in all cases, make sure the medical market is sufficiently regulated so that no one (except government approved credentialed morons experts) can experiment with different techniques.

[steve]

This too will fail.

The (unaddressed) problem is that nobody wants to pay for the health care of those who need really expensive care... not through insurance premiums, not through taxes, not through costs passed on to those with health insurance, and not through not being able to bill for the time spent on these patients.

Doctors aren't going to want to take care of the seriously ill if it means taking a loss, with loss defined as the amount of money they could have earned taking care of a larger number of relatively healthy people with the time they'd have to spend on those needing more care. People needing care will find it harder to get an appointment to even see the doctor.

And a doctor's relatively healthy patients aren't going to want to pay the relatively higher fees to compensate the doctor for the time he spends taking care of those needing more care... they and their health care dollars will move to doctors who have a higher percentage of healthy patients.

Next idea that won't work, anyone?

[Pops]

I say no doctor should be paid more then 10 dollars an hour, and no nurse should need to be paid more than 5 dollars an hour.

The best part is we will bring in illegal aliens to do the doctoring and nursing that Americans won't do at that price.

[Danube of Thought]

Doom.

[Ignatz]

--Now, Republicans calling for market solutions to the health care puzzle argue that empowered consumers will fill this cost-control role if they pay out-of-pocket by way of medical savings accounts. Yet one wonders - these can be very complicated decisions often requiring expert knowledge,and made under trying circumstances.--

The vast majority of visits from low/no deductible employer provided plans are not complicated decisions.
They're the flu or a hangnail or a cough or some stupid complaint some clown uses to get out of school or work or to get some placebo. Take it from a guy with an $8,000 deductible, it's easy to forego those wastes of time and money and it will free doctors up to, oh I don't know, treat actual important illnesses.

[Jack is Back!]

Iggy,

I have a similar policy for the family. I am only concerned with a catastrophic situations. The rest I am prepared to take care of including making sure my son only goes to the Ped with a 2 day fever or worse. We have become a society of hypochondriacs because there is no personal fiscal penalty.

[Jack is Back!]

OMG:

I just saw Hillary on TV in a visit to Tripoli and does she look old, haggard, baggy fat, and limp. Pretty pathetic! She is definitely not fit to run for anything, in fact she could be ill or suffering from something other than Bill's lifestyle.

[Pofarmer]

I'm with Iggy. We go to the Dr. when we need to go. We don't go to the Emergency room on Sunday afternoon for a headache.

[Minimalist Poster]

Just after HillaryCare fell apart, the health care industry was headed towards a flat fee with doctors bearing the financial risk. It works very well paying the gate keepers a flat fee, but no one figured out a good way to include the specialists. They looked at paying the gate keepers a flat fee and the gate keepers contracting separately with specialists on a flat fee basis. They looked at paying medical groups of gate keepers and specialists the flat fee and letting the group allocate revenues. None of those approaches worked.

If any of those approaches had worked, the private sector would be on some sort of flat fee now.

[Pofarmer]

ONE thing would fix this. More Dr.s. When a cardiologist, one year out of medical school, can get an appointment at about any Hospital in any Major city for nearly three quarters of a million dollars a year, the market is SCREAMING shortage.

[Pofarmer]

Oh, and you could add in the fact that we're graduating about a thousand more Dr.s per year now than in 1980, and we have about a hundred million more people.

[Danube of Thought]

Coluldn't agree more, JiB. I strongly believe she is not well.

[Minimalist Poster]

A patient with a back problem is the simplest example. You can pay the general practitioner a flat fee that covers most back problems. You can probably even work out some arrangements that would include physical therapy, a chiropractor or massage therapy. The problem is how to pay the orthopedist or the neurosurgeon.

Health plans looked at including that risk (and the cost) in a single contract with gate keepers and letting gate keepers bear the risk and make the decisions. Health plans looked at separate flat fee contracts with specialists and with groups of specialists. As I recall, they finally decided that there was not a good way to capitate the specialists, so they wound up paying the specialists on a fee for service basis.

[pagar]

"and no nurse should need to be paid more than 5 dollars an hour."

Believe me, you do not get the care you are accustomed to at those prices. I'd guess that your loved ones would be very upset with the care you received. But some of the nurses would probably thank you for the pay raise.

[Extraneus]

Meanwhile in New Hampshire, Romney adopts the OWS commies and their 1-percenter and 99-percenter talking point.

I assume you guys have already covered this, but I can no longer keep up with the threads except maybe on weekends. [sob]

[Jane]

Well that was depressing.

[Jack is Back!]

Mitt,

The non-career politician who acts more like a career politician than the career politicians. He's never stayed in a Holiday Inn Express.

[Janet]

I hadn't seen that Extraneus...thanks. It was depressing.

[Boatbuilder]

That was a gigantic pander. Can you trust this man to to stand up to the inevitable onslaught of criticism and attacks that will greet any substantive attempt to resist the culture of Washington DC? Forget it. And as far as electibility goes, he is not conservative enough to be elected.

[Gmax]

Those of you finding that depressing, buck up, one of the Mitt cheerleaders will be along any minute to tell why that means nothing and you should totally ignore it...

[Janet]

Here is a live feed of the debate at Weasel Zipper.

[Jack is Back!]

Here we go with the debate. I don't trust the questioners unless Newt sets them straight. Gingrich and Bachman first then Perry now Romney and now Cain (ABC order?) Nope, here comes Paul and Santorum. The Way they are positioned .

Cain and Romney up front with Perry off to the side but great applause. They are playing the Anthem. Has this been done before?

[Jane]

I'm snarkblogging over at the gonna walk thread.

[Jack is Back!]

Obama only guy without his hand over his heart.

/kidding.

[Not_Bubarooni]

Should we even watch?

They are finishing the national anthem and i'm already itching to find a ball game...

[Jack is Back!]

Taking questions on Twitter at #CNNDebate.

But the crowd seems to be favorable. Anderson Cooper is a douche and you heard it hear first.

Santorum has 7 kids. More than Teddy R.

Paul is the champion of liberty but is still crazy as hell.

Cain - married for 43 years and a business man. Solves problems for a living - huge applause.

Romney is basking in the Olympics and his business acumen. Has some applause.

Perry, authentic conservative not one of convenience.

Gingrich great to be in Vegas unlike Obama. Replace class warfare with paychecks and not food stamps.

Bachman is thrilled to be in Vegas and hopes what happens doesn't stay in Vegas.

[Jack is Back!]

1st question is on national sales tax. Bachman is answering but not the question. This is the problem. He asked to replace the current income tax with a value added tax not to add a new tax. and if she was a tax attorney then I hope her clients are still whole.

Cain, read the analysis and not be knee jerk. But again that was not the question or the fat guy had no idea what he was asking.

[Sara (Pal2Pal)]

Believe me, you do not get the care you are accustomed to at those prices.

Back in the early '70s, I was expected to clean my own toilet as soon as I was ambulatory after major abdominal surgery. Navy Hospital, San Diego.

[Jack is Back!]

Sorry, running out of battery sitting here so its sayonara and someone else takes over.

[Pofarmer]

Why in the world would Dr.s accept flat payment schemes?

[Not_Bubarooni]

Perry just dropped the 'Romney hired illegal aliens' bomb.

[Not_Bubarooni]

Hey, we might see some fisticuffs breaking out here in a minute!

[cathyf]

I have only one word to say about pushing the risk management down from the insurance companies to the providers.

Tontine.