FOLLOW-UP TO: The critical point that Paul Waldman highlights, perhaps unwittingly, about the healthcare debate between Clinton and Sanders

FOLLOW-UP TO: The critical point that Paul Waldman highlights, perhaps unwittingly, about the healthcare debate between Clinton and Sanders

I exchanged the following comments with reader Lyle in the Comments thread to my post titled “The critical point that Paul Waldman highlights, perhaps unwittingly, about the healthcare debate between Clinton and Sanders”:

Lyle /January 18, 2016 6:31 pm

The question I would put to Sanders: Hospitals say that they lose money on medicare patients and make it up by charging those with insurance under 65 more. If they are being truthful how many hospitals would your plan drive out of business, or force major modifications to. How many physicians would retire if they could only get medicare reimbursement rates?

Now perhaps then you move to a model like the Japanese system, where once a year the providers and the government negotiate fees,


Beverly Mann / January 19, 2016 10:57 am

Lyle, quite a number of rural hospitals went under, with tragic results—they were the only hospitals within a range of, say, more than 100 miles—after the ACA kicked in, in states that refused to agree to the Medicaid expansion, because the Medicaid program as structured before the ACA had included substantial subsidies to hospital apart from the Medicaid benefit to individual recipients that paid ER bills and such.  The ACA switched that part, and only that part as I understand it, to the Medicaid expansion provision in the ACA, presumably as encouragement to states to adopt the Medicaid expansion.

In other words, it was the federal government that was keeping many hospitals afloat, and still is in states that accepted the Medicaid expansion.

Look, in every other modern-economy, Western-style democracy in the world, the government funds the country’s hospitals as part of the country’s healthcare system. The hospitals do just fine in countries—which is all of them, I believe—that have that system.

As for doctors, I have no idea how many would leave the profession if their incomes were cut.  But, without question, this country needs more medical schools and more residency positions; that’s been the real bottleneck in the medical field.  There are large numbers of people graduating from college with premed credentials who aren’t accepted to medical school because of the small number of medical schools and small class sizes.  And there are many more who would get the premed credentials if they thought they had a decent chance to get into med school—and would have a way to fund it.

Which brings me to this: Medical school should be tuition-free.  At public and private universities alike. This would be a really inexpensive way to eliminate one big reason that justifies the sometimes-exorbitant fees doctors charge.  The government should pay off young doctors’ current medical school loans, and, in my opinion, during the financial transition period should offer physicians stipends to compensate somewhat for lost income.

Many doctors, especially so-called primary physicians—internists, family practitioners, pediatricians—while they have comfortable incomes, don’t make huge amounts of money.  Specialists, especially surgical specialists, do, mostly, I believe.  I have the greatest respect for them and for all competent and dedicated physicians.  But maintaining the huge fees many of them charge just cannot justify the huge costs of healthcare in this country.

What strikes me as absolutely necessary—the Clinton administration’s failure to do so in 1993, and the Obama administration’s failure to do in 2009, were respectively fatal and deeply harmful to the effort—is to place one of the most accomplished healthcare economists at the helm of structuring the plan: Princeton’s Uwe Reinhardt.  There are a few, but only a very few, others who could play the role well.  That Bill Clinton put his wife, who had no background whatsoever in this, as head of his administration’s effort, and that Obama mostly just delegated the entire project to Congress, were foreseeably awful decisions.

There is no question, in my opinion, that physicians’ groups must be major players in this process.  But the issues you raise are not insurmountable obstacles, or should not be—any more than they were in any of the other many countries that have excellent universal healthcare whose costs are far lower than the costs of this country’s current system.

These are, obviously, critically important issues.