How Will Federal Bureaucrats Determine Which Health Benefits Are Essential?
What health insurance benefits constitute "essential benefits"? The obvious answer is that what's essential for one person isn't necessarily essential for another. But thanks to ObamaCare, the wise wonks at the Department of Health and Human Services have to decide what's essential for all of us. Modern Healthcare reports (via Kaiser Health News) on an Institute of Medicine report released last week offering some guidance to HHS bureauwonks about how to go about determining what should be included in the essential benefits package:
For all its complexities, the Institute of Medicine's report to HHS on essential health benefits last week is based on a simple premise: Find what works already and improve on it over time. Now a task that's by no means simple falls to HHS, which will develop the proposed and final rules that outline what an essential health benefits package must include and exclude for the sake of making the plans affordable.
You know what mechanism is useful for figuring out what works already and improving on it over time in a vast, complex industry like health care? Markets. No, markets aren't perfect; by design, they tend to allow a certain amount of failure. But they store, process, synthesize, and harness disbursed local knowledge in complex economic systems better than anything else we know of. If continuous marginal improvement across a service sector that accounts for about a sixth of the economy is your goal, then competitive, minimally regulated markets are probably your best bet.
You know what is not good at figuring out what works already and improving it over time in the health care sector? The federal government's health care bureaucracy. This is reflected in its historical lack of success with innovating through demonstration and pilot programs. As Congressional Budget Office director Douglas Elmendorf told members of Congress over the summer, "The demonstration projects that Medicare has done in this and other areas are often disappointing. It turns out to be pretty hard to take ideas that seem to work in certain contexts and proliferate that throughout the health care system. The results are discouraging." The problem, in other words, is scale. Even when federal health wonks identify successful experiments, they've had a tough time making them work system-wide.
Yet many of ObamaCare's reforms are premised on hope in such system-wide reforms: The law creates 29 new pilot programs, 68 grant programs, and a host of new compliance standards and bureaucratic entities in hopes that more of what hasn't worked will somehow work this time. Asking the federal government to experiment with various health care delivery systems, then implement successful experiments on a wider scale is not a new idea. It is an old idea that has consistently failed to work. Here's a KHN report from 2009:
Medicare has conducted hundreds of tests, called pilots or demonstration projects, since the mid-1970s, but can't apply them to the entire system without congressional approval. Lawmakers have made other important changes, but pilot projects have rarely been the catalyst. Most of these experiments haven't been expanded because they failed a threshold test; they didn't save money or improve care. Others passed the test but were derailed by objections from hospitals, doctors and other providers—or were caught up in political fights as control of Congress shifted.
Yet if you look at the few areas of the health system that have consistently operated in a consumer-driven, market-oriented environments—procedures like cosmetic and Lasik eye surgery—you've seen dramatic drops in cost and increases in accessibility. Are those procedures somehow different? One common argument says that they are because they're not essential to health and therefore of less concern to regulators. But perhaps that suggests the folly of tasking regulators with determining which benefits are and aren't essential.
Watch Reason.tv's pre-ObamaCare report on Lasik eye surgery and the health care debate:
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Media anecdotes and horror stories.
What did I win?
I predict they will determine medical marijuana to be essential.
No, I predict pharmacological alternatives to marijuana that poison the patient will be determined essential. Meanwhile, feds will increase raids of medical cannabis facilities.
Guess I forgot to turn on my sarcasm light.
don’t forget treatment for that poison.
One of the great things about dronabinol is that is makes people feel like shit and doesn’t get them high. It’s such a wonderful medicine.
“essential benefits”
1. emergency care
2. preventive care
Exactly. Obamacare will follow the British and Canadian model of allowing those who need joint replacments to either wait in pain, get worse, or die.
Winning!
Those needing joint replacements will endure physical pain, yes, but they will enjoy the spiritual satisfaction of knowing that they suffer for that greatest of progressive values: equality of access.
actually, obamacare will cause such a rate hike people will be begging for a single payer system. then, a single payer system will come in with all of these issues.
then, service providers who don’t want to deal with the bureaucracy will have private insurance above the single payer system. so, most people will have to support the bad single payer system + buy coverage for a private system similar to how it is today.
it will kind of look like that other public delivery experiment- public education. look at the bright side: the amount of $500 million hospital monuments with politicians’ names on them will increase.
“1. emergency care
2. preventive care”
IOWs, stuff.
Thanks.
I can’t wait for the NPR interview with the “erudite, intelligent and thoughtful agent” at the center of the HHS strategy.
So why can’t the consumer be trusted to make decisions for himself again? I mean who knows what is essential better than the person who’s body is at stake?
That’s what “medical ethicists” are for.
Crossing you off the list for any essential procedure……
(Rahm…..how’s our Solyndra investment doing?)
I sold that right after the loans were made and the stock peaked. You didn’t actually keep yours, did you?
You do understand that some people might make different decisions than the ones deemed “best” by their neighbors and fellow citizens right? This cannot be allowed.
Can I interest you in a used camel? Only ridden on weekends by a little old lady from the Emirates.
The progressive mindset in a nutshell:
Denied healthcare for inability to pay: deprivation of basic human rights.
Denied healthcare because panel of self-appointed experts decides you should not have it: enlightened government.
I don’t disagree with you but i do want to nitpick this common lefty assumption:
“Denied healthcare for inability to pay: deprivation of basic human rights.”
This actually doesn’t happen except to those who are screwed by the work-related insurance scheme.
In the real world, individual health insurance is relatively cheap and everyone can afford it.
You are right and I was over-simplifying, though there are folks with pre-existing conditions who can’t be insured at any price. True insurance, as opposed to the pre-payment plans we currently call health insurance, would be far cheaper, but the government totally mucked that up. It’s a neat trick the lefties pulled off, totally jacking the health insurance market then claiming that any perceived inadequacy is a private market failure.
“In the real world, individual health insurance is relatively cheap and everyone can afford it.”
In the real world, you are full of shit.
Since I buy my own health insurance I can safely say you are the one who is wrong.
No, you are wrong. I too buy my own insurance, and the premiums have almost doubled in five years flat here (Massachusetts).
Massachusetts, eh? That may be the problem.
“In the real world, you are full of shit.”
Sorry, your fantasies don’t count as ‘real world’.
For people in the real world, monthly insurance premiums are not “fantasies.” You may live off other people, but I do not.
This actually doesn’t happen except to those who are screwed by the work-related insurance scheme.
I have yet to see an actual example of a real live human being who was turned away from every hospital and clinic because they didn’t have insurance.
If HHS is anything like the guys who put together greatest-hit albums, they’ll intentionally leave out one or two obviously essential procedures so that we have to buy supplemental insurance.
In related news, can anybody explain to me how the 1992 Queen’s Greatest Hits compilation omitted “Bohemian Rhapsody”?
In the real world you can buy health insurance which covers NOTHING until you reach the deductible. Assuming a $5000 deductible plus premiums, you’re right at $500 a month – per person – and for most of us that’s not so affordable.
Talk to your state of residence about how they’ve required all kinds of things to be included in your insurance. Talk to the feds, who won’t permit insurance sale across state lines. Talk to the IRS about preferential tax treatment for employer funded plans. Talk to the AMA, which deliberately restricts the supply of doctors.
Just don’t talk to us, because if you think PPACA or any other currently proposed legislative remedy is gonna solve any of the current problems, you’re not worth engaging in conversation.
I pay $800/month for my family of four and that’s not even the cheapest insurance available to me, AND I live in california where the state has screwed up the private insurance market so badly that the premiums are at least double what they’d be in a free market.
No, insurance is cheap. Everyone can afford it and they’d afford it even better if the govt got out of the way. Of this there can be no doubt.
I don’t really know if it is affordable or not, or what kinds of policies are even for sale in my state. And that’s kind of the point. Do you think maybe I’d know this if we had an actual market for health insurance?
I’m assuming you have always been part of an employer’s group plan, which is of course what the system pressures everyone to do. This means you never really had much of a choice anyway as to your plan or costs.
“But thanks to ObamaCare, the wise wonks at the Department of Health and Human Services”
You misspelled drooling morons incapable of processing even the most basic lessons of recent history.
Check out my blog, Oct. 8th..same stuff you have said…this will without a doubt be used to determine whether some people live or not. Slippery slope. blog.surgerycenterok.com
“this will without a doubt be used to determine whether some people live or not.”
While the left really hates admitting it, medical care is an economic good, and as such, they *have* to admit it will be rationed in some form or other.
The left’s claim here is that it will be rationed for reasons other than money. That’s hogwash on the face of it, as those with money will still spend what’s required to satisfy their desire for medical care. But that option will become far more expensive and the middle class, taxed to support this, will have fewer options; their choices will be made by the “Medical X Agency”, and if you don’t like it, well, try arguing with the IRS.
Further, the elastic demand for new medical products and procedures will be reduced drastically, meaning there will be far fewer new products and procedures.
Lose-lose, but a win for a new government agency. And, per your blog, the rent-seekers.
Re: your blog:
1) Gripe about your comments on excess profits; those will be competed out very quickly.
2) Props on your comments re: rent-seeking for unused facilities.
As a 23 year old male, it is absolutely essential that I am covered for pregnancy costs. Also Viagra.
Also, Suderman: I am proud of you. You’ve really come around on the alt-text.
Do you imagine that they want you to pay for yourself?
You are paying for everyone else.