Too little focus on health costs

Concord Monitor – Online

The following editorial describes the one key component that seems to be missing from the national debate on Healthcare reform: Rising costs.

Most people agree that reform of our nation’s health care system is needed. Not everyone is covered by health insurance or covered well, exposing them to financial catastrophe if their health goes awry. Quality of health care varies from region to region, and from provider to provider. And costs are staggering.

A recent study showed health insurance premiums in New Hampshire have increased over 90 percent from 2000 to 2008. By comparison, wages rose just 21 percent over the same period.

Ask business people in New Hampshire to name their top challenges and they’ll tell you that at or very near the top of the list is paying for the rising cost of health care and health insurance for their employees. This has been a constant refrain for years from our members across the state, from every industry type, and from every size enterprise.

It’s remarkable, therefore, that health care reform under consideration by our congressional delegation in our nation’s capitol seems very likely to add to health care costs, not reduce them. What happened to “bending the cost curve” and eventually lowering it?

Pick your source – the Congressional Budget Office, the Lewin Group, the Centers for Medicaid and Medicare Services, and others – they conclude that health care reform legislation under consideration will, incredibly, increase costs, not lower them.

Lots of attention is being paid to expanding government programs like Medicaid, or creating new ones like a “public option” insurance plan, to cover more uninsured and underinsured individuals. Unfortunately, the federal government’s long track record of grossly under-funding health care providers for their cost of caring for individuals in existing government programs like Medicaid and Medicare makes many employers understandably concerned about expanding them or creating new ones.

More under-funding from the federal government means more cost-shifting to the business community in the form of higher health insurance premiums. How is this reform?

Too little attention is being paid to moving these massive federal programs away from the current fee-for-service payment structure which often rewards health care providers for providing more care, but not necessarily better care, because they get paid more.

Not enough attention is being paid to rewarding providers for lower utilization and improved health outcomes for patients. Too little attention is being paid to reforming our legal system so doctors move away from practicing defensive medicine in order to lesson the odds of being sued.

Until the great health care reform debate shifts emphasis away from its focus on expanding government health care programs or creating new ones, and toward reforming payment incentives, there will be no bending of the cost curve. The curve will continue to rise, and employers will find it increasingly difficult to provide a critical benefit for their employees, and compete in the global economy.

One thought on “Too little focus on health costs

  1. There’s lots more where this came from. Twice a week we post articles that in some manner touch upon the finance of healthcare in the US. We hope to better inform the public about the costs associated with healthcare while at the same time offering a service that may assist people in reducing some of those very costs we are reporting on.

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