So how is this possible? What is his plan? Well, as usual, our new administration likes to articulate Big Plans in very nebulous, non-specific terms (i.e "change" and "level the playing field" etc). The actual details are lacking, but Orszag does adhere to four general guiding principles that will facilitate this vision. Here's Orszag:
How can we move toward a high-quality, lower-cost system? There are four key steps: 1) health information technology, because we can't improve what we don't measure; 2) more research into what works and what doesn't, so doctors don't recommend treatments that don't improve health; 3) prevention and wellness, so that people do the things that keep them healthy and avoid costs associated with health risks such as smoking and obesity; and 4) changes in financial incentives for providers so that they are incentivized rather than penalized for delivering high-quality care.
Step one is simply a mandate for EMR. I don't think any physician has a problem with that. But who's going to pay for its implementation? Will independent physicians in private practice be penalized for not adopting a nationalized EMR and will they be subsidized for their investments?
Step two deals with Comparative Effectiveness Research. This is the foundation of Orszag's plan. He's smitten with the results of the Dartmouth Atlas paper which demonstrated that there is a wide variance in spending at different hospitals across the country, without a concommitant effect on quality or patient outcomes. But it's unclear what sort of guiding principle this will be. Will each physician get a "decision-making playbook" mailed to them every January to use to guide clinical practice? What sort of leeway will physicians have to veer off course a bit for a patient who doesn't quite fit into a federally constructed paradigm? What sort of evidence will be acceptable as CER? The best evidence, randomized controlled trials, take years to acrrue data and determine conclusions. Will physicians find themselves trapped in outdated, fossilized treatment algorithms while they wait for the data in the lab to catch up with the evidence on the battlefield? But again, there are no specifics. It's all on Congress now to come up with the details. I'm just worried that the effects of CER are being overly promoted and even exaggerated in some instances.
Step three is the usual bland, ambiguous drivel about "wellness" and "illness prevention". It's sounds very nice, of course. Obesity and smoking are lifestyle issues that, if corrected on a large scale, will go a long way toward reducing the costly complications of such behaviors (coronary artery disease, diabetes II, hypertension, etc). But what are the specific details? How will we incentivize the American population to avoid bad habits? I hope that step three will ultimately be about individual responsibility. If you're overweight, if you smoke, if you eat poorly, if, because of personal lifestyle choices, you contribute far more than the average American to the health care cost burden, then you probably should be more responsible for funding the public insurance option. Isn't that only fair? If you have ten speeding tickets, you pay more in car insurance. Money talks. When gas was four bucks a gallon, sales of the Prius went through the roof and now two of the Big Three are tottering on the verge of bankruptcy. Appropriately incentivized, the average American will change his/her behavior. If your insurance premiums are twice your neighbor's because you weigh 300 bones, being overweight then becomes a financial problem, not just something to feel bad about while watching American Idol. (And maybe in 2012 we'll see the CEO's of McDonald's and Burger King crawling to Washington DC for bailout requests.)
Step four is a little confusing. It's one of those very wonkish, earnest sounding lines that, upon reflection, could mean any number of things. Is it a call to pay primary care docs more? Is it referring to "never events" and other situations when outcomes are less than desirable (like refusing to reimburse for a patient readmitted to the hospital after recent surgery because you know surgery ought to be like an assembly line, no one should ever get an ileus or an abscess after like a colonic resection)? Again, it isn't clear what the goal of "incentivizing physicans" will be. Maybe it means forgiving med school debt for those who pursue a career in primary care. Who knows.
The bottom line is that Orszag/Obama are dangerously underestimating the cost of overhauling our national health care delivery system in such a way that will guarantee affordable coverage for every American. Focusing on cost-containment is, I'm afraid, rather simplistic and naive. And building an entire long term general fiscal plan around anticipated savings on health care (while at the same time expanding the number of people covered) has the effect of making this Administration seem disingenuous and overmatched.
It's time to stop painting such a rosy picture based on unrealistic hypothetical alterations. Obama would be better served by standing up, being honest, admitting that universal health care is going to be expensive, that future generations will be burdened by decisions we make today, but that health care, alone amongst most other issues, just may be worth it in the long run. And then let the American people decide.
Update: article from David Brooks in the NY Times worth reading.