Most people think of Single Payer as a way to accomplish: a) dependable insurance, b) universal coverage, and c) savings of costs that private insurance companies incur without contributing to health care.
But of all health care issues, the most decisive for us all in the long run is cost.
Universal care can't be sustained if costs continue to rise. Rising costs help tip otherwise viable businesses into failure (GM's biggest handicap pre-bankruptcy), or force shifting the costs onto workers. We are seeing medical costs bankrupt more and more families, as the primary cause -- and most had insurance.
If costs are controlled, the general economy will function better. To thrive, the U.S. economy must compete successfully in world markets. This requires business expenses here in the U.S. are not far higher than our competitors pay, and that workers and technology remain top rate. But the ability of the nation to support education and research depends on available resources. If health care takes more and more of available resources, the national outlook dims.
The cost issue is central.
So the way Single Payer might reduce costs is the most convincing and important aspect of Single Payer (for thoughts on how to make a Public Option less expensive see here). I mean that without cost benefits, Single Payer would not have 2/3rds of its popular support.
The total costs of private health insurance administration, marketing, and profits together add up to roughly 12% of all health care spending in the U.S. (Update: Wendell Potter says here that private insurers are paying out in claims on average at roughly about 80% of revenues, implying the average sum of administration, marketing and profits run closer to 20%.)
That's significant. But even going to Single Payer and saving that 12% (or up to 20%) would not be enough to solve our problems here.
This is because health costs have spiraled much higher than only 12% or 20% upwards over the last decade, becoming far out of line with GDP. We don't get more for all this extra spending. (This NPR piece points out why high cost areas are high cost.)
The challenge is that a one-time reduction in overhead costs would not by itself stop the long-term upward spiral of health care costs due to natural and technological factors described here.
But...without clearly understanding or vocalizing it, many supporters of Single Payer instinctively sense a further outcome.
We correctly sense something more than only saving administrative costs private insurers incur in their work to limit payouts and pad their profits. (Here is a new NYTimes real-life story showing a common situation -- tricky policies).
One unspoken aspect of Single Payer is that if a Single Payer sets the rates, they have near-monopoly power, and most providers would just have to accept the rates they set.
So when the majority (or future majority) of Americans ask for Single Payer, they are really asking that health care costs be controlled, regulated. Set by government.
Then the sharp upward spiral in costs from unregulated fee-for-service health care would become instead a struggle between private providers and the Single Payer over whether to reimburse for ever-expanding treatments.
To which the Single Payer would reasonably respond by specifying more precise treatment paths, and requiring those paths be followed, to control costs. (This is "comparative" or "evidence-based" care, or one way to make a Public Option cost effective.) Or...without such fundamental change it would only a matter of years until we arrive into a new cost crisis (see 2nd comment below) -- leading to more profound reform: into pay-for-outcome (performance) or closely-similar incentive reforms such as those at the Mayo clinic.
All of this would work -- this highly regulated, controlled health care.
It's a feasible outcome.
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This may be needed, if the key, proposed reform of Pay-for-Performance cannot be enacted.
Pay-for-Performance would naturally control rising costs, in the ways described in the post just before this one.
But if the current efforts for Pay-for-Performance are shot down by the industry lobbies, or weakened into ineffectiveness, so that costs continue to spiral upward, then it is reasonable to expect and anticipate the arrival of Single Payer.
Single Payer is the logical next step -- this is what more and more of the body politic will decide.
Most people will say "if you can't reform 'em, then you have to beat 'em."
This will happen as costs continue to spiral upwards without real reform.
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Which is best -- Pay-for-Performance or Single Payer?
While Single Payer controls costs, it doesn't by itself encourage rapid innovation.
Pay for Performance encourages innovation, because the reward is proportional to the effectiveness of the treatment, and innovation could increase efficiency and thus the profitability of treatment. Finally, this innovation will also reduce public costs progressively over time for most health conditions since competition in providing new treatments leads to lower costs. First, if current treatments are effective (such as certain chemotherapies, antivirals, artificial joints, etc.), then a new treatment/technology must hit below the current price point to begin with to be of interest to providers under Pay-for-Performance; second, new treatments tend to become more cost-efficient with time, eventually lowering the insurance costs.
But there is nothing intrinsic in Single Payer that would prevent combining these two ideas.
A Single Payer that would only Pay for Performance would be a fearsomely effective health care cost improvement machine.
Either one of these two reforms would be very potent by itself.
June 29, 2009
June 25, 2009
(Update 9-22) -- Lowering Health Care Costs and Improving Outcomes via Incentives
(Update 9-22-09: How to implement pay-for-outcome-over-time incrementally, with low stakes, and no sudden changes. See update at the end of this post by searching on "9-22")
July Updates: Drug Costs and Setting Prices in a Public or private Plan
This post on exactly how to Pay-for-Outcomes-Over-Time combined with three other simple reforms linked here would constitute cost-effective Health Care Reform.
Also note: this method of payment (below) is a way to encourage and spread coordinated-care systems like the Mayo Clinic, Cleveland Clinic, and Bassett Healthcare by rewarding their effectiveness. Those wanting to go directly to the details can skip down past the 2nd excerpted quote below the video.
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July Updates: Drug Costs and Setting Prices in a Public or private Plan
This post on exactly how to Pay-for-Outcomes-Over-Time combined with three other simple reforms linked here would constitute cost-effective Health Care Reform.
Also note: this method of payment (below) is a way to encourage and spread coordinated-care systems like the Mayo Clinic, Cleveland Clinic, and Bassett Healthcare by rewarding their effectiveness. Those wanting to go directly to the details can skip down past the 2nd excerpted quote below the video.
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When you look across the spectrum from Grand Junction to McAllen—and the almost threefold difference in the costs of care—you come to realize that we are witnessing a battle for the soul of American medicine. Somewhere in the United States at this moment, a patient with chest pain, or a tumor, or a cough is seeing a doctor. And the damning question we have to ask is whether the doctor is set up to meet the needs of the patient, first and foremost, or to maximize revenue.
There is no insurance system that will make the two aims match perfectly.... -- Dr. Atul Gawande
There might be!....
I got a sudden idea today (6/25, below), which I'm mulling over. While I refine it, perhaps others can too. (Updates -- 7/9, 7/23 multiple refinements at this point. I think it's a good outline of how to set up incentives for both everyday and complex situations.)
First, for those wanting a more extensive, deeper look into costs, I encourage those who haven't seen the updates to the Health Care Cost Reduction post below to search (ctrl-f) on the words "effective" and "incentive" for the updates (or read the whole post if you really want a big picture look with issues like technology, psychology, end of life care, etc.).
My initial thinking on how to control costs was to limit a Public (or private) Plan to approved treatments (as existing private plans in fact do!) -- and specifically the most "effective" treatments (definition in this post), in sequence, according to actuarial data on what works best for specific, narrow diagnoses. This seems like a good idea in any case, but there is a more powerful, general way to get excellent care at lower costs and encourage innovation.
Not by specifying what kinds of treatments are used in the Plan. But by incentives alone!
Pay for outcome. Modest pay for trying. Better pay for succeeding. Effectiveness and innovation are rewarded.
I'm not proposing the previous idea of some extra pay (incentive) for a good result. More than that. Instead of a blend of fee-for-service and a little more for outcome, how about payment substantially for outcome.
Before I continue and lay out a plan that answers all the objections I could find to pay-for-outcome, let me illustrate how well-liked the basic idea is by many doctors. Here are only two examples of many:
Dr. Jack Lewin's 2nd point is the current incentives are for volume of care provided, not effectiveness.
Here's a good NPR piece on the same broad issue.
"The high-performing systems of this country are much more able to help manage patients as outpatients without having to be hospitalized, without having to be referred to the emergency room," he says. Doctors in lower-spending areas "are willing to see a patient in the afternoon, start some initial medications, follow them up later in the day to see how they're doing, and if they're doing fine, talk to them in the morning and keep them away from that unnecessary hospital stay."
But the way the government and most insurers pay doctors and hospitals works against the kinds of systems that are more efficient, Fisher says. Doctors don't get paid for things like making phone calls or sending e-mails. And hospitals lose money if patients don't come through their doors.
He and other experts want Congress to implement new payment systems that would encourage doctors and hospitals to work together and give them bonuses for keeping patients healthy, and thus using fewer expensive services. "And I think that if we're thoughtful about creating incentives for organized systems to form — that would allow them to really practice in the ways that physicians came to medicine to do, and the hospital administrators were trained to do — we could get the kind of performance that we want," he says.
This is the subject of this post -- how to structure incentives that will work in the complexity of the real world.
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Let me start by pointing out that paying for outcomes instead of designating approved treatments would actually increase "choice" -- doctors and patients could choose whatever treatment or innovation they like, even within a Public Insurance Plan.
As you will see below, the structure needed is a lot less than we might have guessed, as it is self-forming to a large degree.
Since we want to pay substantially more for good outcomes, we must carefully set or structure the market to set (as you will see) the initial treatment payments so that they defray most of the per-treatment marginal costs, but aren't high enough to be profitable without some success.
For example, for a certain specific condition (specific, narrowly-defined conditions could be listed in a criteria table; see below) the initial treatment payment for that condition might be set for instance at 62% of the full success fee for that condition. The initial payment is made upon treatment, and before the outcome has been determined.
After one or more time periods (listed in the table of criteria, for each condition) have passed and the outcome or intermediate outcome is determined, there would be a failure, partial success or full success, according to the table of criteria. If there is full success, the successful-outcome payment would be the remaining part of the full fee (another 38% payment in our example). For a partial success, the additional payment would be the intermediate-success portion of the fee as defined in the table. For "difficult" cases the overall full fee is increased -- see below. Well-defined levels of partial successes would have defined payments levels.
(update 7-23: establishing outcome criteria)
The tables of outcome criteria -- including time periods for partial to full outcome -- should ideally be formed by large panels of researchers and practitioners in their own specialities via participation in a polling process at the secure internet site where the criteria tables are maintained. This process can easily be formed to take advantage of the increased reliability of larger groups, and should be open to all researchers and practitioners in that speciality, so that participation could be widespread and include even hundreds for some specialties. First, criteria sets, including time-periods, for what would constitute full success and partial success(es) could be created by any participant during the pre-voting period. Participants could also vote on how many distinct levels of success to use for this condition -- 1, 2, 3, 5, etc. -- thus creating the number of partial-success levels. Then a voting period would allow all participants to choose which criteria (including time periods) are most reasonable for full-success, 2nd level success, etc. to the lowest level. There could even be a "run-off" for levels where no criteria set gains a majority on the first vote. After the sets of voting are complete, the results -- for instance the most selected (voted for) of competing criteria sets for a full success would be the result for "full success" criteria -- could then be displayed along with the voting sets (answers) of each participant (to encourage discussion). For narrowly defined conditions, a refined process of this sort could be accomplished in a cumulative 20 minutes or less from most participants as it involves simply listing one's own criteria, and then voting -- notification by email would move each step of the process along. Further, to encourage high standards and discourage vote-fixing these results could be fully visible, transparent, to the public. The resulting criteria tables should be renewed periodically by periodic re-votes and by adding more participants. In this way the criteria tables for most conditions will be an excellent, evolving guide for what constitutes a good outcome and what constitutes one or more levels of partial success. The process itself would be a way to spread knowledge and evolve standards.
Under this system the incentive for a provider -- hospital, doctor, clinic -- is to cure/heal/improve the patient as effectively and cost-efficiently as possible.
They get a initial payment for a treatment, but a nice payoff for a cure or reasonable success. (also see 7-10 update on how to set prices below)
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A crucial part of the Plan must be recurring payments over time for successful preventative care, such as controlling high blood pressure or diabetes. Both the patient and the provider should gain from effective preventative care. We want to strongly incentivize cost-efficient care of all kinds, such as accurate emergency diagnoses for instance.
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So, we have a basic principle to organize how to pay for medical services:
Pay for success.
(And partial payments for partial successes, according to tables).
The public or private plan could be structured in this way instead of by approved treatments, leaving doctors/providers free to innovate.
The idea is to accelerate treatments, efficiency, and innovation. There is little profit in care that doesn't accomplish much. Instead of repeated, largely-ineffective treatments, the incentives are to find real solutions quickly.
Let's work it out. Is there any reason this would not work well? Let's imagine some difficult situations.
For instance, if a doctor/clinic/provider believes it cannot meet the criteria for success or partial success for one diagnosis for a particular patient -- achieving a standard outcome for a specific condition: curing the cause of the symptoms, relieving some symptoms, or for certain conditions, palliative care -- they may turn down a patient, who is then motivated to search out a provider that believes they can succeed. The original provider that thinks they cannot succeed is not motivated to just try a few things for fees/profit. They are motivated to quickly admit to the patient they cannot succeed, and stop without excessive, expensive, wasted tests/treatments.
When one provider fails (or only gives a diagnosis and quits), the full-success payment for that particular patient would be increased by a fixed percentage (e.g.--another +15 percentage points, so that the full fee with success becomes 115% for this patient), which can be earned by other providers who have no remunerative relationship to the first provider, sweetening the pot, and making the patient more attractive as a customer in spite of their difficult condition. More failures or refusals to treat could lead to bigger jackpots for success (125%...then 135%...then 150% for success), but still only the original initial payment for failed treatments or an exam-only fee for exams without treatment. But, note that the partial-success payment levels would be increasing in proportion to the full-success fee (e.g.-- for instance, a partial-success payment of 18% of full fee amount for meeting certain criteria for a certain condition would increase in value as the full fee amount increases.))
Therefore, even a partial-success becomes more and more worth a try even for the least responsive patients.
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Diagnoses themselves should be incentivized, with initial payments for tests, but substantial payments (according to table) for proven-correct diagnoses, contingent on treatment proving a diagnosis via treatment-response criteria. If the diagnosis indicates a certain condition, and the treatment results show a change that meets criteria that prove the condition was present, then the diagnosis was correct. The initial payments for diagnostic tests would be carefully structured to support the diagnostic test costs, but not make tests too profitable in the absence of correct diagnosis. The diagnosing doctor has an incentive to get the diagnosis right, and earns more per hour of work if he/she finds the correct diagnosis, or several correct diagnoses, sooner. The test costs are covered but not especially profitable, and the main payoff comes from getting correct diagnoses.
The patients themselves help police the system (along with the success incentives) -- wanting to be cured quickly and well, they will try to find the best providers available for their condition, and they have freedom to choose providers without plan restriction, since the cost control is built-in (also see pricing update below).
===Update 7/8 --Drug Costs=====
A basic aspect to consider is drug costs. Today, we need effective law against the prescribing doctor receiving any kickbacks or participation in profits from prescriptions. But this need could become obsolete under a better system.
The central issue is getting the best drug choices for the dollar.
Providers should have an incentive to choose drugs wisely, balancing cost and effectiveness. A simple idea to incentivize smart drug choices is to require 1/2 (or perhaps even all) of the drug cost be paid by the prescribing doctor. This would then be a part of the full success fee, and the fee would be set accordingly by the price of the commonly effective drug; but the fee itself would also be independent of drug choice except when specific drugs fail or are ruled out (see below). The doctor has to choose what is cost-effective and works effectively, to get the best economic outcome -- the full success fee without undue drug cost. The doctor then has a strong incentive to find cost-effective drugs for his/her patients.
Sometimes a patient will not respond to one drug or family of drugs or cannot take that type of drug, and needs a different type of drug. If effective alternative drugs are significantly more expensive, then the full success fee would be appropriately higher for the condition of non-response or non-usability of the initial best-practice type of drug.
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===Update 7-10, 7-17 -- Setting Prices===
One key practical question in a Public Option (aka Public insurance Plan) or a Private Insurance Plan is how the insurer sets its prices -- the fees paid to doctors/providers.
To understand this section, be sure to first read "establishing outcome criteria" above.
Whether the public or private insurer is paying for piecemeal treatments in an old-style (and costly) fee-for-service system or instead is paying for outcomes (based on specific, narrow diagnoses -- "conditions") in a fee-for-outcome system as described above, the insurer must have a rational way to set prices.
Either way, the answer is an auction.
The exact way to run an auction and set up incentives for bidding are practical questions. Below, I will offer some price setting ideas that can be tested and refined by experience over time by any insurer, public or private.
The Plan (public or private insurer) can simply solicit bids to perform specific treatments or bids for treating specific conditions (bidding is for the "full-success" fee -- see establishing outcome criteria above), and have a community or regional target of having a certain minimum number (or percentage) of providers in that area for each kind of treatment.
Doctors and providers need do no extra work to submit bids. They could simply submit their current pricing (for a fully-successful treatment or outcome) perhaps with a volume-discount of 10%-20% in anticipation of more patients (due to the more people having insurance). Thus little or no effort to calculate prices is needed.
No complex calculations are needed.
Even without submitting a bid or being in a network, any doctor can participate fully or partially in the Plan with little paperwork, or none (see below).
Once the sealed bids are in (via on-line submission), then the Plan will simply accept a bid level high enough to include roughly the target number of providers for each specific treatment or outcome. In this way, the low bidders don't lose, they gain -- they will get the accepted bid level, thus they gain the extra pay difference between their original low bid and the accepted price level.
One good bidding incentive would be to reward bidders that submit bids below the accepted final price with a bonus above that of the price difference they will already receive, perhaps another 5% of that difference. A further refinement is that once an average number of patients per doctor/specialist are treated by a provider during a time period, the low-bid bonus could be phased out for additional patients, gaining an extra price efficiency for the insurer and thus the policy holders. (Note that this is a suggestion of a method and bonus percentage that can be tested and refined over time through experience by the insurer.)
For instance if the bids for a specific treatment or outcome range from $105 to $287, and the target portion of providers is 50% in that region, then the bid at or below which 50% of the providers come in would be the new Plan price for that specific treatment or outcome. In this example, for our range of $105 to $287, this price level that includes 50% of providers might be at $172, thus the new Plan price would be $172 for all in-network providers. But this same payment would be paid to any doctor who chooses to accept a Plan patient, even without any prior paperwork or network status (more on this below).
Providers that submit bids below our example $172 would then would get both the full $172 plus a bonus percentage for submitting a bid below price. (Again, such details can be tested and refined over time by the insurer.)
This is done for all the specific treatments/conditions covered by the Public (or private) Plan in a computerized on-line pricing auction, thus effecting a complete set of Plan prices. Providers then can choose whether to become a Plan in-network provider at these prices.
A few simple rules could handle the question of all-or-nothing in-network status.
For instance, to be certified as a "Full (Public or private) Plan Provider" or a "Preferred Plan Provider", etc., a provider would accept all the Plan prices for the treatments they offer. But...a provider could choose to offer certain treatments at above-Plan pricing (and perhaps advertise as a "Partial Plan Provider" etc.) by giving clear notification to the patient at sign-in of those price premiums, and requiring the patient sign-off on a specific price premium they must pay out of pocket (or via supplemental insurance) before treatment in order for the provider to be fully reimbursed from the Plan for the portion paid by the Plan (lack of a price notification signed off by patient would result in the patient being only liable for 1/3 of the premium above Plan, this amount capped at 10% of the Plan price).
This is only an optional, pragmatic method to allow non-Plan providers to opt-in to widespread Plans with less paperwork and administration.
This allows 100% flexibility. The Plan (Public or private Plan) using this method does not exclude any provider. Any above-price provider could accept any Plan patient with simply a clear notification of their premium pricing the patient or supplemental insurance must cover.
(Another interesting possibility is to allow private insurers to use any Public Plan as a building block within their own plans, in addition to being able to offer "supplemental" insurance. This would allow individuals to purchase private insurance for less established or less reliable treatments which are not fully reimbursed by any particular Plan.)
This is 100% freedom of choice, and 0% interference in the choices of patients and doctors.
Treatments or treating conditions can be auctioned on an ongoing basis, annually or semi-annually. Providers would not need to change their existing bids unless they feel their pricing needs to change. Providers could gradually modify their bids as new ways of treating conditions emerge that are more cost-effective, thus gaining the additional small bonus percentage from lower-than-plan bids.
This promotes cost-improvement over time, as in other areas of service technology.
New Treatments -- providers could offer new unique bids for new possible outcomes. Once enough bids occur for a new type of outcome (a new successful treatment of a previously incurable condition), the Public or private Plan can then initiate an accepted bid level for this new type of treatment at its own discretion, thus including the new treatment into its benefits. Before new treatments/drugs or potential new outcomes are fully accepted as Plan-Established, they could have co-insurance requirements (patients must pay part of the cost out-of-pocket, or via private supplemental insurance).
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In principle, this kind of pay for outcome could work quite well. It is widely used in a simple form we all are familiar with -- work guarantees.
Savings accumulate to the plan in three ways -- more preventative care due to incentives, fewer tests and wasted treatments due to incentives, and innovation leading to reduced costs for many conditions which will then over time gradually lead to some fees being reduced in the compensation tables.
Combined with the three other simple and easy reforms which involve increasing information to patients and encouraging preventive care, we have complete reform.
It's encouraging that "changing incentives" was one of Obama's major points on ABC the other night.
I'll update this preliminary post as I think of further aspects.
In its simplest form, the Public (or private) Plans would pay set fees for specific narrow diagnoses/ages in fixed regions. The patient could then find a provider willing to try to earn the success (or partial success) fee, in town, or nearby, or in some cases by traveling to a specialized center.
The Public (or private) Plan, and any private insurer choosing this method, would pay its successful-outcome payment after specified time periods for various conditions when a successful outcome is verified by an independent inspector. One key part of this plan is periodic payments for continued preventative success, perhaps annually.
Your thoughts?
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7-7: Just saw this great article by David Leonhardt on this whole question of costs and incentives. Highly recommended.
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Update 9-22:
Reading this brief Peter Orszag interview it occurs to me to point out an easy, low-stakes way to gradually move from pure fee-for-service towards more pay-for-outcome-over-time.
The objective is to transition with small changes anyone could like and which doctors universally (or near universally) could support.
Reform without big, sudden change would be much easier to implement politically.
Start with a very short list of only a few narrowly defined conditions (such as a severely arthritic knee which needs replacement, or certain heart conditions) and implement small success payments, such as 5%-15% of the normal full cost of complete treatment. The success payment would be made after the treatment is shown successful as indicated by no need for extra treatment(s) beyond the normal follow ups needed for that specific condition within a certain specified time period for each specific condition in the list.
The initial payment, made when the main treatment is complete, would be most of the full cost of complete treatment. For example, if the success payment is 10% (before we also add a bonus percentage for outcome quality), then the initial payment would be 90%. Thus the complete payment for a successful treatment in this example would be the total of 90% + 10% + the bonus percentage.
Another example, for clarity: for a certain condition, upon treatment an 88% initial payment (88% of the full fee) could be made, and if the patient does not need further treatment (other than normal follow up and normal therapy) for that condition during the specified success time period, a 12% success-over-time fee payment would be made after that time period. The outcome quality would then be used to also generate an additional bonus percentage payment. --- For instance, in our example of an 88% initial fee, the success payments might total 14%, for a grand total of a 102% successful treatment payment. For this condition, some patients might not be treated successfully and would thus result in a payment of only 88% of the full fee, while most patients on the other hand would be treated successfully and would result in a payment of 102%.
This outcome-incentive system could be implemented initially for a short list of 5-20 specific, moderately-expensive narrow conditions which have clear enough typical outcomes such that it is easy to specify what is a good outcome-over-time in terms of a no-relapse, or success, time period. Any success bonus percentage (above the normal full fee) can vary according to what is shown to work well over time by experience.
Gradually, several new conditions/success-criteria could be added each year to the list, for instance by vote of panels of doctors, or even better by the full process I described earlier in this post.
I recommend that the establishing outcome criteria internet-polling process as laid out above be implemented from the beginning, to gain several kinds of powerful advantages, such as spreading information about best-practice and new techniques, encouraging market-driven innovation, etc.
This is a simple, limited version of pay-for-outcome-over-time which would have low stakes, and allow a gradual implementation.
Slowly, over time, a pay-for-outcome system could come into being, improving quality and value.
June 20, 2009
Major Updates -- Healthcare Cost Reduction Ideas and Incentives -- Discussion Encouraged (Updates Ongoing)
Note: this was a brainstorming post, and more fully-developed ideas are here: Incentives-for-outcomes-instead-of-specifying-treatments, or for a broad summary post: best cost-control ideas.
Update 6/23 -- Incentives (see end of post)
Update 6/25 -- Preventative care incentives,
Refined definition of what is an "effective" treatment
7/7 -- See new post above for a detailed incentive plan as an alternative to approved treatments
7/10 -- Alternatives (bonus!)
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Let's work on better ideas for health care.
For instance, the quandary of some people dying from lack of very basic care on the one hand versus the spiraling cost of care on the other hand is resolved in an idea I present below. The proposal also resolves the public vs. private debate.
Even if it only helps to choose between existing proposals, it is worthwhile to think of better ideas. I think we can inject new ideas into the current debate, which can be incorporated into existing proposals, or new proposals.
We can come up with good ideas for health care.
This is our choice.
As citizens paying taxes, we have the right to influence the debate and the new law.
It is never too soon or too late. Even if we came up with a better idea after a bill is passed in August or September, it will influence the reforms and practices later. But here on June 20th, I think new ideas we find in the next few days could be communicated to Congress and help influence the debate and outcome right now.
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I encourage readers/visitors to just plain shoot from the hip or give your thought-out ideas, either one.
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One approach I like is to start from scratch -- what would be the best way to do health care, regardless of what has been done before.
So, blank slate time....
Here are my initial thoughts:
Even by 1980, most of us didn't expect we might well live to be 93 or 96. But it is more feasible for many now than it was 30 years ago. Our expectations of medical salvation have risen greatly.
Given some kind of reasonable chance to have a decent quality of life with new medical treatments, most people would indeed be willing to spend a lot of money if needed to make it happen. While some can afford to spend a lot, many cannot. The differences in ability-to-pay leading to too-large health care differences bothers many of us.
Next: Technology means that there is no real limit to what kinds of high-tech new treatments can be invented and tried to extend life. And there is no natural limit to cost except what can be paid from all available money, even if it is every cent, every last penny, people have.
No matter how much money we spend, there are always more expensive cutting edge treatments left to try if one is willing and able.
So since we are willing to pay large amounts of money to extend life, and since industries of people are making a living making up new treatments --....the national cost will...always...rise...and...rise...until it hits the limit of every last penny that can be taken from all other areas of life.
Unless we impose limits on the publicly-supported portion of this choice.
Notice I say publicly. A limit on public support still leaves free choice on the personal/private side wide open.
Anyone can still purchase *any* additional health care (via supplemental private insurance) they want -- just like before.
Basically this idea only creates one fundamental change in the status-quo: more cost-effective universal basic care than the current emergency-room care disaster we have. This is a huge change that reduces costs yet allows for the private health care "freedom of choice" many say they like.
So....one thought that occurs to me is that a public plan cannot cover unlimited new treatments or even a lot of advanced new therapies-- the public plan would need to be conservative in order to avoid gigantic cost increases. Public support could cover everything that really pays off well (this is defined below). No one would die from lack of basic care.
"Basic" includes all well-proven, cost-effective care, preventative care and emergency care.
Publicly covered treatments need to be cost efficient -- a lot of result per dollar.
There are a great number of medical treatments that produce a lot of results per dollar spent. Part of a health-care law could be that all employers *must* provide a work-free day per year for a routine checkup, and having this provision actually enforced. In fact, the best health scenario for anyone is to treat problems early with well-proven early treatments that work well.
Early treatments like these cost less.
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Now, part of the consequence of better basic care is exactly that more people live longer into old age, where illnesses of old age arise.
Currently we spend a huge amount of our health-care dollars treating the last 6 months of life.
Once a person lives to an advanced age, fewer and fewer effective treatments are possible. "Effective" treatments are treatments that extend life by more than a year at least, most people would agree.
(Remember, for those that don't agree, we leave them their free choice -- further treatment options that buy 2 or 6 months of life are up to them, just as now)
Treating a 30-yr old diabetic will extend life for a great many years. But some expensive and technological treatments for a 91-yr old might extend life by only months in many situations.
We need a way to choose what the public plan will support.
First, as above, the public plan should support first the most proven, effective therapies/procedures, which have success rates that are clearly higher than alternatives, by public data tables, according to clear and distinct diagnostic standards.
The public plan should only cover "effective" treatments, if they haven't yet been tried. I'd favor that more expensive treatments with success rates below 30% be considered "extended" or some such designation, and have significant co-pays (perhaps 30%-50% of their cost), so that patients have a realistic way to weigh their high cost versus benefits.
A public plan can only work if it has limited costs. Otherwise it would fail in time, and be cut back by force of financial crisis.
Of course, this will leave grey areas.
But the public plan isn't for grey areas. It is for proven basic care, where the situation is a clear statistical likelihood of success or reasonable chance of success.
Grey areas can be left to free choice -- private health insurance and such. (more on grey areas below)
So a public plan needs to have a very clear standard for treatments in old age -- the public plan (only) needs to provide just treatments that will significantly extend life, by at least a minimum period of time. Private plans can cover other situations.
I propose the public life extension time period be 1 full year -- the public plan can provide proven treatments that extend life at least 12 months where the statistical odds are at least 40%, according to governmental actuarial tables -- clearly defined statistical results with clear criteria.
When a treatment is close to the border, and a public inspector finds it falls outside the defined public criteria, the public compensation would be reduced by specific amounts after inspection. That is, the public inspector might find a doctor applied for public funds for a situation that wasn't fully within the public plan criteria, and then the public payment would be reduced according to precisely defined law in clear steps, such as 25% less (than the set public plan compensation), 50% less, 75% less. Only a few steps, and well-defined rules. Rules that clearly spell out what gets partial reimbursement. But specifying treatments precisely will hold the number of these grey situations to a minimum.
This overall approach allows enormous flexibility in actual treatment!
For instance, the public plan might cover an MRI and a certain specific surgery at defined payments, but if the patient and doctor choose to do additional steps, that's perfectly fine. The public plan covers what it covers, clearly and reliably.
But doctors/patients and private plans can do whatever further they want, flexibly, so that the total costs are covered in part publicly, in part privately.
...
Another idea that occurs to me is that there is no harm at all in making a public plan that is exceedingly conservative and....cheap!
It is necessary really. We have limited funds, and our goal isn't ultimate health care -- it's universal health care.
There are a lot of basic treatments that are effective and less costly, so we could choose to just create a public plan that does exactly only the most proven, effective treatments, and nothing more. The lower-rated treatments would never be covered by the public plan in this scenario.
In other words, instead of more comprehensive, we could aim for more cost-effective.
The whole point is to help everyone, every time, that can be helped in well-established, basic ways at a cost that almost all households can afford to pay for themselves.
The public plan would be well-defined and well-publicized.
The public plan could gradually take on new therapies/treatments over the years according to well-defined standards of cost-effectiveness in extending life.
No one would die from lack of basic care. Except by failure to act.
Anyone could then buy private insurance (see, we still have full-fledged, free-enterprise, private health care and private insurance here) to cover further treatment above that basic limited list on the public plan. Likely private plans would offer a great variety of options to extend coverage to various levels of less certain treatments.
Voila!
The conflicts of public vs. private insurance solved!
We don't have to choose between "fairness" and "freedom."
We can have basic health care, just like basic education. Basic, defined, limited, universal.
Yes?
....
Your ideas???
--------------
NPR continues their excellent coverage of health care with this worthwhile segment on health care costs by Robert Siegel. Highly recommended. It is rife with examples the idea here would address.
-------------
Paying for the Plan:
No matter whether public or private, we all will pay for health care.
My initial suggestion for how best to run this public plan is by premiums, and a mandate.
Private insurance plans could, by choice, purchase the public plan as a building block for their own plans (at the same standard rate individuals pay). A free market in that regard.
So all individuals would either buy the public plan, or a private plan that incorporates the public plan, or pay a set annual fee to be excluded.
This plan would be tax-neutral, requiring no new revenue, and having no net public cost.
Since this public plan would be basic care only with limits as described above, it's cost would be quite low, affordable.
For this reason it may not be necessary to provide a subsidy for most lower-income households. The premiums could be *very* low.
In fact, another way to help set limits for the public plan is to let it buy whatever it can for a set low premium, like about $100-$200/month per person age 25-61, $50/month under age 25. Age 62 and over probably needs a careful consideration for premium level.
The virtue in this particular method of cost-control is that the chosen treatments would be determined by mathematics -- cost/benefit, and not by politics.
In order to extend this kind of plan, politicians would have to raise it's premiums.
That removes a lot of the forms of political kickbacks that can occur, where contributions lead to Congressional interference.
Next, I'd favor a pay-for-performance incentive -- according to detailed actuarial tables. Payments to providers would be higher by a set amount, such as 20%, for a successful outcome versus an unsuccessful outcome (in the well-defined treatments the plan is designed to cover).
I'm confident though that a premium of only $100/month to $200/month for a 45-yr-old adult could indeed buy quite impressive basic health care with cost-effective, well-defined benefits and reasonably low co-pays, such as $25 office visits and drug co-pays of $10-$25 for most drugs, and $50-$100 for more expensive drugs. Most people would then just supplement this basic care coverage with private insurance for extended benefits.
The whole point of the public plan is to provide affordable basic health care. Affordable means the cost would be quite low, so that a family with an income of even just $35,000/yr could actually pay the premiums. Thus the plan doesn't rely on large federal subsidies.
-------------
This post will be repeatedly updated. It is a brainstorming post.
=====================
UPDATES:
=====================
Incentives
James Kwak offers a good discussion of the other major cost-increasing force in health care: providers would like to earn more money.
This is a problem of incentives. The financial incentives for doctors/hospitals/health-care-providers are to do more, even if less is just as good.
We need to change the incentive structure to paying in part for outcomes, instead of only for services.
This could be accomplished without interfering much with doctors simply by laying out the basic treatment services covered for various precise diagnoses, which is what basic care is about. When a treatment doesn't work, it shows an additional condition, such as a doesn't-respond-to, which then would lead to a further course of treatment, etc. Once treatments are specified for these basic care situations, then only diagnostic services are difficult to incentivize correctly. I'd suggest we consider paying a significant up-front payment for diagnosis itself -- a diagnosis fee payment -- and then reduce the payments for specific tests, thus incentivizing some efficiency in choosing and giving tests. If initial tests did not determine the likely cause of illness, further tests would still be paid for, but the profitability of doing a great number of tests would be modest.
A few more simple rules would flesh out the incentives, such as making half the diagnosis fee contingent on diagnostic success, so that sending the patient on to associated providers for more testing means giving up a part of the profit. Kickbacks for referring patients in general need to become illegal.
One good incentive would be a successful-outcome incentive.
Many specific illnesses and injuries have fairly clear criteria of what constitutes curing/healing. In these cases, a successful treatment bonus is a very good kind of incentive. Even for pains that have less clear causes, some kinds of incentives are possible -- success in these cases could be relief that last a certain length of time, or even two incentives, for two different lengths of time.
Successful-outcome incentives encourage providers to effectively treat the patient, and make room for more patients in their system.
A final category of incentives we need are powerful incentives for preventative care. Good reimbursement for providers is a basic necessity. But there's more. Patients themselves need incentives. Along with the mandatory day-off for a wellness checkup mentioned above, we could require the wellness checkup as a condition of the low premium cost, or even give a direct payment to the individual for meeting their wellness checkup requirement.
One possible version of an incentive for individuals to follow through on a wellness checkup -- after missing a wellness checkup, a bill would be sent to the individual for $250 as a supplemental annual "risk-premium" cost, with a note that the individual can choose among three options:
a) have a wellness checkup during the time period remaining in lieu of the $250
b) elect to pay an extra $250 annual premium within 60 days
or
c) default to an increase in their automatic monthly premium of $21 in the case of no-response (refunded later if the wellness checkup is done within the annual period).
This extra annual risk-premium for not accomplishing a wellness checkup can increase after more than two years of missing wellness checkups to $500/yr ($42/month). This is simply a "risk-premium" and should be named correctly for clarity.
---------------------------------------------------------------
7/10 Update -- Bonus section for Geeks and those who like to consider further alternatives.
Alternatives
I think it's fun to think outside the box, and if no good health care reform comes out in the next month or two it could be worth thinking further -- there are more than one or two ways to get to a good health care outcome.
For instance, Universal Coverage with guaranteed acceptance (no preexisting condition exclusions) doesn't absolutely require a Public Plan or Single Payer. The public methods are ways to get things done, but there are further ways....
Our ultimate goals are only a few:
Call this "Automatic Insurance." Make it refundable if the individual then chooses to buy their own policy.
Second, basic, is to require policies to be fully clear about what they cover, and to meet at least a very limited, basic level of coverage such as all preventative care, emergency care, and well-established treatments (any treatment in use for more than 18 years.) Yes, basic, limited, clear, cheaper.
Co-pays could be required and also limited by law to $0 for preventative care, $25 office visits, $100 for emergency care, and to 20% of lab and test costs (with legally required on-the-spot price information). Deductibles and out-of-pocket maxes could be capped by law at $500, or the total amount an insured individual or family has in a HSA (health savings account). Keep this very simple -- proof of HSA account balance is enough, once/year -- almost zero paperwork. These steps could stop fake insurance policies that trick buyers.
The electronic record of insurance would be at a Government database, allowing providers to ascertain the insurer of anyone walking in the door who is a citizen or pays taxes, or is a dependent of those.
The second piece of legislation is simple disclosure -- requiring providers to fully disclose costs for patients in real-time (to the patient, immediately) of care/options they are offering -- the amount that particular patient will pay out of pocket for that particular treatment.
That's how to generally keep our current system while eliminating most of its worst aspects. The cost spiral problem would continue to some extent....for a while, until the too many customers (you and I) finally get tired of over-paying and *choose* changes in providers/insurance. Private insurers could set up pay-for-outcome if they like, and increase incentives for cost-efficient preventative care. Those doing so could increase their own profits.
Doctors and insurers wanting more profits could simply do some planning, modest investing, and aim for cost-efficient care and higher numbers of patients. It's called free enterprise.
It would be easy for providers/insurers to hire reasonably smart people to actually improve their own health-care efficiency and cost-effectiveness. Even consultants. Ultimately, the free market can drive the unattractively overpriced providers out of business and replace them with more efficient competitors. That's called free-enterprise too.
It's an economic fact that if you get too overpriced in a market, you can go out of business.
Some kind of change is needed at least because of the form of cost-spiral castastrophe where the uninsured, including those able to pay for insurance, can walk into an emergency room without paying and the costs be put on taxpayers and the insured. That's why Government collecting premiums through taxes makes sense in terms of fairness. Even poor people can pay a little.
A Public Plan is ultimately only a way to accomplish similar goals (Universal acceptance) a little faster.
A Public Plan won't have extra costs unless it is poorly designed. Poorly designed, though, is a quality too many of our current private (and public) health care funding systems.
Update 6/23 -- Incentives (see end of post)
Update 6/25 -- Preventative care incentives,
Refined definition of what is an "effective" treatment
7/7 -- See new post above for a detailed incentive plan as an alternative to approved treatments
7/10 -- Alternatives (bonus!)
-----------------------------------------------------------------------------------
Let's work on better ideas for health care.
For instance, the quandary of some people dying from lack of very basic care on the one hand versus the spiraling cost of care on the other hand is resolved in an idea I present below. The proposal also resolves the public vs. private debate.
Even if it only helps to choose between existing proposals, it is worthwhile to think of better ideas. I think we can inject new ideas into the current debate, which can be incorporated into existing proposals, or new proposals.
We can come up with good ideas for health care.
This is our choice.
As citizens paying taxes, we have the right to influence the debate and the new law.
It is never too soon or too late. Even if we came up with a better idea after a bill is passed in August or September, it will influence the reforms and practices later. But here on June 20th, I think new ideas we find in the next few days could be communicated to Congress and help influence the debate and outcome right now.
...
I encourage readers/visitors to just plain shoot from the hip or give your thought-out ideas, either one.
=======================================
One approach I like is to start from scratch -- what would be the best way to do health care, regardless of what has been done before.
So, blank slate time....
Here are my initial thoughts:
Even by 1980, most of us didn't expect we might well live to be 93 or 96. But it is more feasible for many now than it was 30 years ago. Our expectations of medical salvation have risen greatly.
Given some kind of reasonable chance to have a decent quality of life with new medical treatments, most people would indeed be willing to spend a lot of money if needed to make it happen. While some can afford to spend a lot, many cannot. The differences in ability-to-pay leading to too-large health care differences bothers many of us.
Next: Technology means that there is no real limit to what kinds of high-tech new treatments can be invented and tried to extend life. And there is no natural limit to cost except what can be paid from all available money, even if it is every cent, every last penny, people have.
No matter how much money we spend, there are always more expensive cutting edge treatments left to try if one is willing and able.
So since we are willing to pay large amounts of money to extend life, and since industries of people are making a living making up new treatments --....the national cost will...always...rise...and...rise...until it hits the limit of every last penny that can be taken from all other areas of life.
Unless we impose limits on the publicly-supported portion of this choice.
Notice I say publicly. A limit on public support still leaves free choice on the personal/private side wide open.
Anyone can still purchase *any* additional health care (via supplemental private insurance) they want -- just like before.
Basically this idea only creates one fundamental change in the status-quo: more cost-effective universal basic care than the current emergency-room care disaster we have. This is a huge change that reduces costs yet allows for the private health care "freedom of choice" many say they like.
So....one thought that occurs to me is that a public plan cannot cover unlimited new treatments or even a lot of advanced new therapies-- the public plan would need to be conservative in order to avoid gigantic cost increases. Public support could cover everything that really pays off well (this is defined below). No one would die from lack of basic care.
"Basic" includes all well-proven, cost-effective care, preventative care and emergency care.
Publicly covered treatments need to be cost efficient -- a lot of result per dollar.
There are a great number of medical treatments that produce a lot of results per dollar spent. Part of a health-care law could be that all employers *must* provide a work-free day per year for a routine checkup, and having this provision actually enforced. In fact, the best health scenario for anyone is to treat problems early with well-proven early treatments that work well.
Early treatments like these cost less.
...
Now, part of the consequence of better basic care is exactly that more people live longer into old age, where illnesses of old age arise.
Currently we spend a huge amount of our health-care dollars treating the last 6 months of life.
Once a person lives to an advanced age, fewer and fewer effective treatments are possible. "Effective" treatments are treatments that extend life by more than a year at least, most people would agree.
(Remember, for those that don't agree, we leave them their free choice -- further treatment options that buy 2 or 6 months of life are up to them, just as now)
Treating a 30-yr old diabetic will extend life for a great many years. But some expensive and technological treatments for a 91-yr old might extend life by only months in many situations.
We need a way to choose what the public plan will support.
First, as above, the public plan should support first the most proven, effective therapies/procedures, which have success rates that are clearly higher than alternatives, by public data tables, according to clear and distinct diagnostic standards.
The public plan should only cover "effective" treatments, if they haven't yet been tried. I'd favor that more expensive treatments with success rates below 30% be considered "extended" or some such designation, and have significant co-pays (perhaps 30%-50% of their cost), so that patients have a realistic way to weigh their high cost versus benefits.
A public plan can only work if it has limited costs. Otherwise it would fail in time, and be cut back by force of financial crisis.
Of course, this will leave grey areas.
But the public plan isn't for grey areas. It is for proven basic care, where the situation is a clear statistical likelihood of success or reasonable chance of success.
Grey areas can be left to free choice -- private health insurance and such. (more on grey areas below)
So a public plan needs to have a very clear standard for treatments in old age -- the public plan (only) needs to provide just treatments that will significantly extend life, by at least a minimum period of time. Private plans can cover other situations.
I propose the public life extension time period be 1 full year -- the public plan can provide proven treatments that extend life at least 12 months where the statistical odds are at least 40%, according to governmental actuarial tables -- clearly defined statistical results with clear criteria.
When a treatment is close to the border, and a public inspector finds it falls outside the defined public criteria, the public compensation would be reduced by specific amounts after inspection. That is, the public inspector might find a doctor applied for public funds for a situation that wasn't fully within the public plan criteria, and then the public payment would be reduced according to precisely defined law in clear steps, such as 25% less (than the set public plan compensation), 50% less, 75% less. Only a few steps, and well-defined rules. Rules that clearly spell out what gets partial reimbursement. But specifying treatments precisely will hold the number of these grey situations to a minimum.
This overall approach allows enormous flexibility in actual treatment!
For instance, the public plan might cover an MRI and a certain specific surgery at defined payments, but if the patient and doctor choose to do additional steps, that's perfectly fine. The public plan covers what it covers, clearly and reliably.
But doctors/patients and private plans can do whatever further they want, flexibly, so that the total costs are covered in part publicly, in part privately.
...
Another idea that occurs to me is that there is no harm at all in making a public plan that is exceedingly conservative and....cheap!
It is necessary really. We have limited funds, and our goal isn't ultimate health care -- it's universal health care.
There are a lot of basic treatments that are effective and less costly, so we could choose to just create a public plan that does exactly only the most proven, effective treatments, and nothing more. The lower-rated treatments would never be covered by the public plan in this scenario.
In other words, instead of more comprehensive, we could aim for more cost-effective.
The whole point is to help everyone, every time, that can be helped in well-established, basic ways at a cost that almost all households can afford to pay for themselves.
The public plan would be well-defined and well-publicized.
The public plan could gradually take on new therapies/treatments over the years according to well-defined standards of cost-effectiveness in extending life.
No one would die from lack of basic care. Except by failure to act.
Anyone could then buy private insurance (see, we still have full-fledged, free-enterprise, private health care and private insurance here) to cover further treatment above that basic limited list on the public plan. Likely private plans would offer a great variety of options to extend coverage to various levels of less certain treatments.
Voila!
The conflicts of public vs. private insurance solved!
We don't have to choose between "fairness" and "freedom."
We can have basic health care, just like basic education. Basic, defined, limited, universal.
Yes?
....
Your ideas???
--------------
NPR continues their excellent coverage of health care with this worthwhile segment on health care costs by Robert Siegel. Highly recommended. It is rife with examples the idea here would address.
-------------
Paying for the Plan:
No matter whether public or private, we all will pay for health care.
My initial suggestion for how best to run this public plan is by premiums, and a mandate.
Private insurance plans could, by choice, purchase the public plan as a building block for their own plans (at the same standard rate individuals pay). A free market in that regard.
So all individuals would either buy the public plan, or a private plan that incorporates the public plan, or pay a set annual fee to be excluded.
This plan would be tax-neutral, requiring no new revenue, and having no net public cost.
Since this public plan would be basic care only with limits as described above, it's cost would be quite low, affordable.
For this reason it may not be necessary to provide a subsidy for most lower-income households. The premiums could be *very* low.
In fact, another way to help set limits for the public plan is to let it buy whatever it can for a set low premium, like about $100-$200/month per person age 25-61, $50/month under age 25. Age 62 and over probably needs a careful consideration for premium level.
The virtue in this particular method of cost-control is that the chosen treatments would be determined by mathematics -- cost/benefit, and not by politics.
In order to extend this kind of plan, politicians would have to raise it's premiums.
That removes a lot of the forms of political kickbacks that can occur, where contributions lead to Congressional interference.
Next, I'd favor a pay-for-performance incentive -- according to detailed actuarial tables. Payments to providers would be higher by a set amount, such as 20%, for a successful outcome versus an unsuccessful outcome (in the well-defined treatments the plan is designed to cover).
I'm confident though that a premium of only $100/month to $200/month for a 45-yr-old adult could indeed buy quite impressive basic health care with cost-effective, well-defined benefits and reasonably low co-pays, such as $25 office visits and drug co-pays of $10-$25 for most drugs, and $50-$100 for more expensive drugs. Most people would then just supplement this basic care coverage with private insurance for extended benefits.
The whole point of the public plan is to provide affordable basic health care. Affordable means the cost would be quite low, so that a family with an income of even just $35,000/yr could actually pay the premiums. Thus the plan doesn't rely on large federal subsidies.
-------------
This post will be repeatedly updated. It is a brainstorming post.
=====================
UPDATES:
=====================
Incentives
James Kwak offers a good discussion of the other major cost-increasing force in health care: providers would like to earn more money.
This is a problem of incentives. The financial incentives for doctors/hospitals/health-care-providers are to do more, even if less is just as good.
We need to change the incentive structure to paying in part for outcomes, instead of only for services.
This could be accomplished without interfering much with doctors simply by laying out the basic treatment services covered for various precise diagnoses, which is what basic care is about. When a treatment doesn't work, it shows an additional condition, such as a doesn't-respond-to, which then would lead to a further course of treatment, etc. Once treatments are specified for these basic care situations, then only diagnostic services are difficult to incentivize correctly. I'd suggest we consider paying a significant up-front payment for diagnosis itself -- a diagnosis fee payment -- and then reduce the payments for specific tests, thus incentivizing some efficiency in choosing and giving tests. If initial tests did not determine the likely cause of illness, further tests would still be paid for, but the profitability of doing a great number of tests would be modest.
A few more simple rules would flesh out the incentives, such as making half the diagnosis fee contingent on diagnostic success, so that sending the patient on to associated providers for more testing means giving up a part of the profit. Kickbacks for referring patients in general need to become illegal.
One good incentive would be a successful-outcome incentive.
Many specific illnesses and injuries have fairly clear criteria of what constitutes curing/healing. In these cases, a successful treatment bonus is a very good kind of incentive. Even for pains that have less clear causes, some kinds of incentives are possible -- success in these cases could be relief that last a certain length of time, or even two incentives, for two different lengths of time.
Successful-outcome incentives encourage providers to effectively treat the patient, and make room for more patients in their system.
A final category of incentives we need are powerful incentives for preventative care. Good reimbursement for providers is a basic necessity. But there's more. Patients themselves need incentives. Along with the mandatory day-off for a wellness checkup mentioned above, we could require the wellness checkup as a condition of the low premium cost, or even give a direct payment to the individual for meeting their wellness checkup requirement.
One possible version of an incentive for individuals to follow through on a wellness checkup -- after missing a wellness checkup, a bill would be sent to the individual for $250 as a supplemental annual "risk-premium" cost, with a note that the individual can choose among three options:
a) have a wellness checkup during the time period remaining in lieu of the $250
b) elect to pay an extra $250 annual premium within 60 days
or
c) default to an increase in their automatic monthly premium of $21 in the case of no-response (refunded later if the wellness checkup is done within the annual period).
This extra annual risk-premium for not accomplishing a wellness checkup can increase after more than two years of missing wellness checkups to $500/yr ($42/month). This is simply a "risk-premium" and should be named correctly for clarity.
---------------------------------------------------------------
7/10 Update -- Bonus section for Geeks and those who like to consider further alternatives.
Alternatives
I think it's fun to think outside the box, and if no good health care reform comes out in the next month or two it could be worth thinking further -- there are more than one or two ways to get to a good health care outcome.
For instance, Universal Coverage with guaranteed acceptance (no preexisting condition exclusions) doesn't absolutely require a Public Plan or Single Payer. The public methods are ways to get things done, but there are further ways....
Our ultimate goals are only a few:
- Cost efficiency for the sake of the general U.S. economy
- Universal coverage -- preexisting condition coverage
- More Preventative Care (for both quality of life and cost effectiveness)
- Reasonable flexibility/freedom for doctors and patients
- Continued innovation
Call this "Automatic Insurance." Make it refundable if the individual then chooses to buy their own policy.
Second, basic, is to require policies to be fully clear about what they cover, and to meet at least a very limited, basic level of coverage such as all preventative care, emergency care, and well-established treatments (any treatment in use for more than 18 years.) Yes, basic, limited, clear, cheaper.
Co-pays could be required and also limited by law to $0 for preventative care, $25 office visits, $100 for emergency care, and to 20% of lab and test costs (with legally required on-the-spot price information). Deductibles and out-of-pocket maxes could be capped by law at $500, or the total amount an insured individual or family has in a HSA (health savings account). Keep this very simple -- proof of HSA account balance is enough, once/year -- almost zero paperwork. These steps could stop fake insurance policies that trick buyers.
The electronic record of insurance would be at a Government database, allowing providers to ascertain the insurer of anyone walking in the door who is a citizen or pays taxes, or is a dependent of those.
The second piece of legislation is simple disclosure -- requiring providers to fully disclose costs for patients in real-time (to the patient, immediately) of care/options they are offering -- the amount that particular patient will pay out of pocket for that particular treatment.
That's how to generally keep our current system while eliminating most of its worst aspects. The cost spiral problem would continue to some extent....for a while, until the too many customers (you and I) finally get tired of over-paying and *choose* changes in providers/insurance. Private insurers could set up pay-for-outcome if they like, and increase incentives for cost-efficient preventative care. Those doing so could increase their own profits.
Doctors and insurers wanting more profits could simply do some planning, modest investing, and aim for cost-efficient care and higher numbers of patients. It's called free enterprise.
It would be easy for providers/insurers to hire reasonably smart people to actually improve their own health-care efficiency and cost-effectiveness. Even consultants. Ultimately, the free market can drive the unattractively overpriced providers out of business and replace them with more efficient competitors. That's called free-enterprise too.
It's an economic fact that if you get too overpriced in a market, you can go out of business.
Some kind of change is needed at least because of the form of cost-spiral castastrophe where the uninsured, including those able to pay for insurance, can walk into an emergency room without paying and the costs be put on taxpayers and the insured. That's why Government collecting premiums through taxes makes sense in terms of fairness. Even poor people can pay a little.
A Public Plan is ultimately only a way to accomplish similar goals (Universal acceptance) a little faster.
A Public Plan won't have extra costs unless it is poorly designed. Poorly designed, though, is a quality too many of our current private (and public) health care funding systems.
June 16, 2009
Our Great Recession Could Be Made Into A Great Recovery (Updated)
I was reading through Brad DeLong's 1997 chapter on the Great Depression, enjoying his detailed writing, when I hit the central question we face now posed in his section "The Persistence of the Great Depression." DeLong offers a consideration of long-term unemployment in his 1997 perspective, but the ultimate cause is missing. We now can say incisively a more fundamental reason the Great Depression persisted.
The reason the Great Depression persisted in such a long slump, instead of simply reversing into a typical recovery is ultimately quite simple -- debts and the necessity to pay them off, and the spread of frugality in response to the conditions. These are not primarily a question of debt service loads or interest rates -- people decide in accordance with their expectations and longer term plans whether they can borrow more or must pay down debts instead. Debts and frugality, which I laid out more fully here, explain the persistence.
The other piece I've read over a couple of times lately is Ambrose Evans-Pritchard's recent column "The depression quietly deepens" which is, of course, about here and now. This is useful for its bracing quality, to focus the mind.
With my description of the Great Depression, these three pieces together suggest a key piece of the way out of this morass.
Debt forgiveness.
In the U.S. we have two primary forms and one minor form which are often used. The two major forms of debt relief are foreclosure, which can deal with the large debts from overpriced housing that has returned to normal values, and bankruptcy, which can deal with the debts from too many (overpriced) purchases driven by the illusion of equity wealth. A minor form of debt relief is to negotiate debt reductions from unsecured creditors, such as credit card companies (which may prefer partial payments over total losses in a bankruptcy). (Update: just saw that CR has a post on this particular form of debt relief - a good sign. NYTimes source article here.)
What we fail to realize in our public discussion is the high virtue of these forms of debt forgiveness for the general economy.
We do much better for each other if we do not insist on the enslavement of many of our fellow citizens in modern debtors' prisons -- walls of debt that cannot be repaid. Debts so large that their attempted payment would ensure another Great Depression, which in turn would make their payment progressively harder and finally impossible.
Debt relief is our chance to get out of this mess by forgiving those who truly did not expect house prices and the economy to go south.
While we don't want to benefit those who knowingly took advantage, we must forgive the majority who were blindsided by forces they did not imagine.
In addition to the debt-overwhelmed group that isn't able to purchase much of anything, we also have the large group I'll call the In-Betweeners -- those who are currently able to make payments on their significant debts, but who are squeezed into sharp consumption cutbacks due to rising credit card interest rates. Their reduced spending also threatens to drag the economy into a long, long slump.
I proposed a specific way to ease the interest burdens of this group here (look for "What might help consumers pay off their non-mortgage debt faster?")
Together, these various forms of debt relief can help revive our economy.
Once the debt load of American consumers is reduced, they will be able to buy more goods and services, supporting a stronger economic recovery. The other key piece for a strong recovery is new American innovation, new American goods and services, new businesses -- and the aid of a helpful climate to allow new business to flourish, including favorable tax conditions and such aids as more economical health care.
At this point we no longer need to fear over-consumption. That trend is well and truly broken. (more here, here, and Mish's version) It was a matter of psychology, and the psychology is changed. It is a new world.
What shape would we like our New World to take? We face either Depression or radical change to escape one.
Our Great Recovery will require either a overwhelming stimulus program like World War II or...widespread debt relief.
The thing is, the faster this debt relief is brought forward, the sooner a friendly and easier economic climate can arrive.
And time is not irrelevant. Years of slump really can add up. Three or four years of a 5% per annum growth difference, for instance, would add up to a very different world. While we think rightly of issues like solvency of medicare and social security, even more drastic consequences are always possible. Imagine for example if the graph of national economies during the Great Depression in DeLong's chapter did not have an turn upward for the U.S. in the 1930s, while the 1930s German and Japanese economies soared.
Real national security comes from economic and technological capacity. The ability to arm. A "defense" plan that puts current defense spending above the economy itself profoundly threatens the nation.
But long-term security isn't the main justification for a better economic plan. We should do it for quality of life.
The thing we understand now, in 2009, that we did not know in 1933-1935, is that the nation pays one way or the other for deflating-asset debts. We will all pay regardless, one way or another. Whether we pay directly, or indirectly through a long slump.
Debt relief is a quicker way to cure this key underlying problem.
We are all in this together regardless of philosophy, and will recuperate, or suffer, together.
---------------
Update 6-18
Martin Wolf lays out the big picture for the world economy and our situation to date vs. the Great Depression in his latest article -- whether we might escape another Great Depression.
Martin writes:
-------------
(Readers may wonder if the idea of debt forgiveness was an original piece from the book I've been writing. The answer is no, these thoughts were worked out here in this blog. The book deals with more fundamental economic and life questions, which will help our nation, and ourselves individually, really thrive.)
The reason the Great Depression persisted in such a long slump, instead of simply reversing into a typical recovery is ultimately quite simple -- debts and the necessity to pay them off, and the spread of frugality in response to the conditions. These are not primarily a question of debt service loads or interest rates -- people decide in accordance with their expectations and longer term plans whether they can borrow more or must pay down debts instead. Debts and frugality, which I laid out more fully here, explain the persistence.
The other piece I've read over a couple of times lately is Ambrose Evans-Pritchard's recent column "The depression quietly deepens" which is, of course, about here and now. This is useful for its bracing quality, to focus the mind.
With my description of the Great Depression, these three pieces together suggest a key piece of the way out of this morass.
Debt forgiveness.
In the U.S. we have two primary forms and one minor form which are often used. The two major forms of debt relief are foreclosure, which can deal with the large debts from overpriced housing that has returned to normal values, and bankruptcy, which can deal with the debts from too many (overpriced) purchases driven by the illusion of equity wealth. A minor form of debt relief is to negotiate debt reductions from unsecured creditors, such as credit card companies (which may prefer partial payments over total losses in a bankruptcy). (Update: just saw that CR has a post on this particular form of debt relief - a good sign. NYTimes source article here.)
What we fail to realize in our public discussion is the high virtue of these forms of debt forgiveness for the general economy.
We do much better for each other if we do not insist on the enslavement of many of our fellow citizens in modern debtors' prisons -- walls of debt that cannot be repaid. Debts so large that their attempted payment would ensure another Great Depression, which in turn would make their payment progressively harder and finally impossible.
Debt relief is our chance to get out of this mess by forgiving those who truly did not expect house prices and the economy to go south.
While we don't want to benefit those who knowingly took advantage, we must forgive the majority who were blindsided by forces they did not imagine.
In addition to the debt-overwhelmed group that isn't able to purchase much of anything, we also have the large group I'll call the In-Betweeners -- those who are currently able to make payments on their significant debts, but who are squeezed into sharp consumption cutbacks due to rising credit card interest rates. Their reduced spending also threatens to drag the economy into a long, long slump.
I proposed a specific way to ease the interest burdens of this group here (look for "What might help consumers pay off their non-mortgage debt faster?")
Together, these various forms of debt relief can help revive our economy.
Once the debt load of American consumers is reduced, they will be able to buy more goods and services, supporting a stronger economic recovery. The other key piece for a strong recovery is new American innovation, new American goods and services, new businesses -- and the aid of a helpful climate to allow new business to flourish, including favorable tax conditions and such aids as more economical health care.
At this point we no longer need to fear over-consumption. That trend is well and truly broken. (more here, here, and Mish's version) It was a matter of psychology, and the psychology is changed. It is a new world.
What shape would we like our New World to take? We face either Depression or radical change to escape one.
Our Great Recovery will require either a overwhelming stimulus program like World War II or...widespread debt relief.
The thing is, the faster this debt relief is brought forward, the sooner a friendly and easier economic climate can arrive.
And time is not irrelevant. Years of slump really can add up. Three or four years of a 5% per annum growth difference, for instance, would add up to a very different world. While we think rightly of issues like solvency of medicare and social security, even more drastic consequences are always possible. Imagine for example if the graph of national economies during the Great Depression in DeLong's chapter did not have an turn upward for the U.S. in the 1930s, while the 1930s German and Japanese economies soared.
Real national security comes from economic and technological capacity. The ability to arm. A "defense" plan that puts current defense spending above the economy itself profoundly threatens the nation.
But long-term security isn't the main justification for a better economic plan. We should do it for quality of life.
The thing we understand now, in 2009, that we did not know in 1933-1935, is that the nation pays one way or the other for deflating-asset debts. We will all pay regardless, one way or another. Whether we pay directly, or indirectly through a long slump.
Debt relief is a quicker way to cure this key underlying problem.
We are all in this together regardless of philosophy, and will recuperate, or suffer, together.
---------------
Update 6-18
Martin Wolf lays out the big picture for the world economy and our situation to date vs. the Great Depression in his latest article -- whether we might escape another Great Depression.
Martin writes:
The question is whether today’s unprecedented stimulus will offset the effect of financial collapse and unprecedented accumulations of private sector debt in the US and elsewhere. If the former wins, we will soon see a positive deviation from the path of the Great Depression. If the latter wins, we will not. What everybody hopes is clear....
Martin points out the exact question that will determine whether we recover -- exactly what I've addressed above:
[My explanations in dark green]:
We are seeing a race between the repair of private balance sheets [paying down large debts] and global rebalancing of demand [nations with big trade deficits, like the US, importing less], on the one hand, and the sustainability of stimulus [whether deficit stimulus spending can be maintained long enough to allow a sustainable recovery], on the other.... Robust private sector demand [consumer and business spending] will return only once the balance sheets of over-indebted households, overborrowed businesses and undercapitalised financial sectors are repaired or when countries with high savings rates [China, etc.] consume or invest more. None of this is likely to be quick. Indeed, it is far more likely to take years, given the extraordinary debt accumulations of the past decade. Over the past two quarters, for example, US households repaid just 3.1 per cent of their debt. Deleveraging [paying down debts to a lower ratio vs. income] is a lengthy process. Meanwhile, the federal government has become the only significant borrower [household and business borrowing is sharply down, which is why treasury bonds interest rates are still historically rather low]....Here is the graphic article Martin refers to by Eichengreen and O’Rourke showing our world economic progress to date vs. the Great Depression.
-------------
(Readers may wonder if the idea of debt forgiveness was an original piece from the book I've been writing. The answer is no, these thoughts were worked out here in this blog. The book deals with more fundamental economic and life questions, which will help our nation, and ourselves individually, really thrive.)
June 13, 2009
Why Federal Borrowing Does Not Crowd Out Private Investment Now...Again
Lately we are hearing various commenters worry that the recent rise in Treasury yields suggests some fundamental market insight that we are on a wrong course. But they are forgetting what is normal. Current rates are more a return to normal. We are a ways yet from rates that are high enough to be threatening. Worrying about these more normal rates is similar to noticing a light breeze after an period of calm, and rushing to close the storm shutters.
Martin Wolf correctly lays out the current situation in a recent FT column.
Readers of this blog will already know this central point made here back in January:
Still, it seems we need to be reminded of the fundamental situation, and it's nice to hear the same central point from another writer, in different language, for clarity.
Martin Wolf correctly lays out the current situation in a recent FT column.
...Economists who believe in “Ricardian equivalence” – after the early-19th-century economist David Ricardo – argue fiscal policy is ineffective, because households will offset any government dis-saving with their own higher savings.Economists disagree fiercely on these points. My approach is “Keynesian”: in extreme moments, the excess of desired savings over investment soars. Again, monetary policy, while important, becomes less effective when interest rates are zero. It is then wise to wear both monetary belt and fiscal braces.
A deep recession proves there is a huge rise in excess desired savings at full employment [Hal here: I'd word this more clearly -- simply that people want to save a lot now and for now that is excess savings], as Prof Krugman argues. At present, therefore, fiscal deficits are not crowding the private sector out. They are crowding it in, instead, by supporting demand, which sustains jobs and profits.
Readers of this blog will already know this central point made here back in January:
...crowding out [which itself leads to higher interest rates]...certainly does happen when an economy is running at or near full steam, so that resources (machines, workers, money) are being fully or almost fully utilized, so that all new output of the economy requires new investment dollars. In that situation, private investment competes for those new dollars with government. But when an economy has much slack, as ours does now, so that more money is sitting in money market accounts and short term treasury bills, there is plenty of available money for government borrowing and investing, and still plenty left for any private borrowing and investing the private sector chooses.
Still, it seems we need to be reminded of the fundamental situation, and it's nice to hear the same central point from another writer, in different language, for clarity.
June 10, 2009
Field of Dreams (updated)
if you build it...they will come...
A broad mythic idea lights up this movie: in America, you only have to be in the right place at the right time. They will come.
There's something about America.
We dream of striking it rich (more about this in my coming book).
There was more than only greed and speculative fever behind the housing boom. More than easy mortgages and anything-goes lending.
Many believed in the American myth of the windfall -- "making it big" by hitting it lucky. This is more than only greed. Greed is taking too many freebies from a bowl at a store, or overcharging a customer (remind you of hospitals?). This mythic American sense is more...transcendent than greed. It's being in the center of things. Being in -- with it. It isn't only money -- it's the glamour of being in the American moment -- of sharing the togetherness of the moment and the good feeling.
Many believed that more and more people would move into the desert near Las Vegas, or bid houses ever higher in California, because they were, up till then.
While we tend to focus on factors we think enabled and fed the bubble in housing, we forget that something more fundamental is at work.
Beliefs are more powerful in their economic effects than interest rates or even basic human conditions like avarice.
If people believe the economy will grow, it will grow, and if they believe it will weaken, it will weaken.
If people believe lower interest rates will create new growth, then that belief will help cause that outcome.
So long as people believed housing prices would go up, it was very likely new ways would be found to enable the continued rise.
Obstacles like interest rates or mortgage terms are less significant than beliefs. If there had been no interest-only or negative-amortizing loans, buyers would have simply found another method to fulfill their beliefs.
They might have tried joint-ownership purchases of houses in cooperative buying in order to continue the price rise -- they would do whatever it took, so long as the belief in ever-higher prices remained.
The market topped out because it stalled for lack of sufficient warm bodies in some locations (more homes were being built than there were people wanting to live in them in certain places and even speculators noticed this in time), and this scattered flattening of prices got enough media attention to spread a new belief -- that prices would flatten or even fall in many places -- then this new belief set in motion a broader outcome.
Here and now we have decided together on a modest recovery with continued job losses, but no one can truly predict the outcome 6 months from now because the beliefs will evolve and change as we go along.
June 9, 2009
Expanding Subjects and Fun Stuff (and subscriptions info)
I started this blog with the intent to have fun with a wide range of subjects related to economics and our lives, more akin to the range in the book I'm finishing now. As you know, I've writen here almost exclusively on economics to date as once-in-a-lifetime events have dominated the last half year. We are skirting on the edge of a worldwide depression, and it isn't clear yet which way we will move. The next two years will decide this question.
But it's time to start having fun here with topics I've wanted to explore.
Also, I'll be limiting subscriptions/feeds to short intros in order to encourage more people to read directly here on the site and make comments.
Those who like the blog for it's serious, careful assessments of economic conditions and paths will still find posts in that vein. The fun stuff I'll be exploring will be relevant also -- it's like brainstorming and research and development. So expect a mix of some far ranging ideas, fun connections, and quite serious assessments of what is happening, all three. Most will find this mix more interesting.
---
One interesting bit that popped into my head an hour ago: the movie Field of Dreams -- Kevin Costner in the field and then: "...If you build it....they will come." A post on this soon...
But it's time to start having fun here with topics I've wanted to explore.
Also, I'll be limiting subscriptions/feeds to short intros in order to encourage more people to read directly here on the site and make comments.
Those who like the blog for it's serious, careful assessments of economic conditions and paths will still find posts in that vein. The fun stuff I'll be exploring will be relevant also -- it's like brainstorming and research and development. So expect a mix of some far ranging ideas, fun connections, and quite serious assessments of what is happening, all three. Most will find this mix more interesting.
---
One interesting bit that popped into my head an hour ago: the movie Field of Dreams -- Kevin Costner in the field and then: "...If you build it....they will come." A post on this soon...
June 7, 2009
Marketplace Steps Up on Debt and Reality
Marketplace's weekend program stepped up it's game this week to something I'd actually recommend.
Most of the program is focused on debt, savings, and living in the New Reality.
The New Reality (one nice description) and what to do about it were addressed here on this blog.
This New Reality is finally starting to become visible to more people than only a small minority.
Most of the program is focused on debt, savings, and living in the New Reality.
The New Reality (one nice description) and what to do about it were addressed here on this blog.
This New Reality is finally starting to become visible to more people than only a small minority.
June 5, 2009
Medical Costs Cause Most Bankruptcies
In 2001, researchers found that about 46% of bankruptcies were for medical reasons.
By 2007, that percentage had increased to 62% (!) -- usually from medical debts (more than 90% of cases), and the small remainder from loss of income.
The problems of health care in America are actually quite, quite simple, and well understood.
Private insurers spend significant money, time and effort screening out and denying insurance to people likely to need more than occasional health care.
They try to insure only those who are healthy.
They also spend a lot of money for staff to work hard to deny insurance claims on any possible technical reason, and carefully write policies to shift more and more of the normal costs of care off their list of insured benefits and onto individuals and families. Many of these technical exceptions are hard for customers to understand when reading the policies.
The other major health care cost problem is doctors and care facilities ordering more tests and procedures only in order to increase profits.
This is done under cover of the initial rationale that doctors are trying to be careful in order to avoid being sued. This nice On-Point program has a knowledgeable doctor (Dr. Atul Gawande) travel to similar West Texas cities to discover why health care in one costs twice what it does in the other very similar city. It's strictly about increasing profits.
(One of many shocking parts begins at 10 and 1/2 minutes into the program -- and that's only a tip of the iceberg part. Also, here is a written article on this in the The New Yorker.)
Increasing profits even while bankrupting previously financially sound families.
These two major problems are clear and well-understood.
As clear as day.
Smaller problems are used to obscure and distract attention away from these primary problems.
Like the transfer of taxpayer wealth to bank investors, we have a situation where true but misleading reasons are presented in order to hide the reality of what is happening.
Health insurers don't want public competition. And a certain number of doctors do not want competition.
They make big campaign contributions to buy influence and votes.
Our Congress is compromised.
And it's been this way so long it seems normal.
By 2007, that percentage had increased to 62% (!) -- usually from medical debts (more than 90% of cases), and the small remainder from loss of income.
Using a conservative definition, 62.1% of all bankruptcies in 2007 were medical; 92% of these medical debtors had medical debts over $5000, or 10% of pretax family income. The rest met criteria for medical bankruptcy because they had lost significant income due to illness or mortgaged a home to pay medical bills. Most medical debtors were well educated, owned homes, and had middle-class occupations. Three quarters had health insurance. Using identical definitions in 2001 and 2007, the share of bankruptcies attributable to medical problems rose by 49.6%. In logistic regression analysis controlling for demographic factors, the odds that a bankruptcy had a medical cause was 2.38-fold higher in 2007 than in 2001. --The American Journal of Medicine.
The problems of health care in America are actually quite, quite simple, and well understood.
Private insurers spend significant money, time and effort screening out and denying insurance to people likely to need more than occasional health care.
They try to insure only those who are healthy.
They also spend a lot of money for staff to work hard to deny insurance claims on any possible technical reason, and carefully write policies to shift more and more of the normal costs of care off their list of insured benefits and onto individuals and families. Many of these technical exceptions are hard for customers to understand when reading the policies.
The other major health care cost problem is doctors and care facilities ordering more tests and procedures only in order to increase profits.
This is done under cover of the initial rationale that doctors are trying to be careful in order to avoid being sued. This nice On-Point program has a knowledgeable doctor (Dr. Atul Gawande) travel to similar West Texas cities to discover why health care in one costs twice what it does in the other very similar city. It's strictly about increasing profits.
(One of many shocking parts begins at 10 and 1/2 minutes into the program -- and that's only a tip of the iceberg part. Also, here is a written article on this in the The New Yorker.)
Increasing profits even while bankrupting previously financially sound families.
These two major problems are clear and well-understood.
As clear as day.
Smaller problems are used to obscure and distract attention away from these primary problems.
Like the transfer of taxpayer wealth to bank investors, we have a situation where true but misleading reasons are presented in order to hide the reality of what is happening.
Health insurers don't want public competition. And a certain number of doctors do not want competition.
They make big campaign contributions to buy influence and votes.
Our Congress is compromised.
And it's been this way so long it seems normal.
June 1, 2009
Best of May
We just got back from a little vacation, but making a best of the month for May is quite easy.
One interview stood out well above others to my mind:
David Goldman being interviewed by Tom Keene
(scroll down the list to "David Goldman...")
Some thoughts:
My take on the issue of American demographics and the future economy is here (and previous more in-depth thoughts on Japan's lost decade and how to avoid it is here.)
While the middle of the interview (on Chrysler bondholders) just made me wonder whether the taxpayers put enough money into Chrysler to be able to simply subsidize the Unions more than the bondholders during bankruptcy (this question isn't addressed), the rest of the interview is good stuff.
We face an endless barrage of information and shallow analysis. When someone talks about the real issues that underlie the trends and issues of the day, this kind of interview is far more interesting.
One interview stood out well above others to my mind:
David Goldman being interviewed by Tom Keene
(scroll down the list to "David Goldman...")
Some thoughts:
My take on the issue of American demographics and the future economy is here (and previous more in-depth thoughts on Japan's lost decade and how to avoid it is here.)
While the middle of the interview (on Chrysler bondholders) just made me wonder whether the taxpayers put enough money into Chrysler to be able to simply subsidize the Unions more than the bondholders during bankruptcy (this question isn't addressed), the rest of the interview is good stuff.
We face an endless barrage of information and shallow analysis. When someone talks about the real issues that underlie the trends and issues of the day, this kind of interview is far more interesting.
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