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Jared Bernstein

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Health Care Economics

Posted: 04/27/2012 1:59 pm

If the economy were a person, here's how I'd describe his travails in recent years.

For far too long, he binged on junk food, with no regard for the impact of such dietary habits on his system. He gorged on sub-prime cuts of real estate and paid for it with cheap credit whose price failed to reflect the damage he was doing to his internal organs.

He visited his doctor, a guy named Greenspan who'd studied medicine with Ayn Rand herself, but the doctor just slapped him on the back and told him he must be fine because he wasn't sick... yet.

Then, on September 15, 2008, he collapsed. He was rushed into intensive care, where eventually, his case was taken over by the medical teams of Obama and Bernanke. Dr. Obama, a cardiologist, applied stimulus to get his heart beating again, while Dr. Bernanke used angioplasty to clear the junk out of his veins so the credit blood could start circulating again.

His recovery was slow -- he'd really messed up his insides. But he was getting better. Then, in the 2010 midterms, the hospital elected a new board that was strongly against such medical interventions as those benefiting our client. They yanked out the stimulus tubes and discharged him.

He was out of the woods, but he wasn't better. His blood is circulating, but not that smoothly, and his heart beat is still below normal. If you watch him even today you see the symptoms of his incomplete treatment: every time he starts to climb the stairs or break into a run, he has to pull himself back and rest for awhile.

The hospital board remains intractable -- if anything, they're busy convincing themselves that it's all the Drs fault, especially that Obama guy (who they claim got his M.D. in Kenya). Dr. Bernanke, who has an independent practice, still sneaks in to see the patient now and again, but there's only so much he can do. It's hard to get the blood circulating if the heart's still beating too slowly.

Eventually, he'll get better, but at this rate it's going to take years. We could reform the health care system, but to do that, we'll need to replace the hospital board.

This post originally appeared at Jared Bernstein's On The Economy blog.

 
 
 

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11:01 PM on 04/28/2012
The patient has healed slower than any other patient because the doctor has chained him to his hospital bed with record amounts of regulations.
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HUFFPOST SUPER USER
Josh Crawford
Just the facts, man!
12:56 AM on 04/29/2012
Total and complete BALONEY!!!

According to the Bureau of Labor Statistics, for every employee that is laid off due to "government regulations", about 130 are laid off due to "lack of demand".

Basically a big, fat lie by Republicans. If demand is adequate, businesses will hire, basically regardless of the regulatory burden. Blaming the slow recovery on regulations (let alone the new regulations from Obama above and beyond what existed previously) just shows how little you really understand about what's going on here. May I suggest you tap a source other than FoxNews for your information?
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Sue She
Restore the Matriarchy
10:31 PM on 04/28/2012
I recently spend 5 hours in the ER due to severe abdominal pain. I was given a bed, a CAT scan and some pain medication and then release. The bill? $12,000. For what? Someone is seriously gorging in the health care industry and it's not the patient. The entire system needs to be overhauled, there should be no doctors, only nurses (they seem to do most of the work anyway) and surgeons, and inventors should not get a cut every time a person gets a CAT scan. It's no wonder the bloated health care "industry" is in the state it's in.
05:40 PM on 04/28/2012
No reform unless they get rid of the insurance companies. Banks recieved billions and now another recesion. High costs and zip services.
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TomeOfBullos
04:17 PM on 04/28/2012
I can't think of a worse analogy, actually. At least not as written.
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LoneTree
Liberty is more precious than life.
03:17 PM on 04/28/2012
The Galapagos tortoise lives up to 170 years and has a heart rate 1/4th that of humans. "Local and sustainable" as we say. But to join the health care analogy....

What we don't need is more emergency medical intervention, create "crest and crash" cycles in the patient's metabolism. We need to get the patient on a healthy regime of good nutrition (broccoli, cooked at home, no more dining out), mental activity to improve cognition and attitude, and physical activity, along with regular medical checkups.

The physicians need to withdraw their instruments and nostrums and pass this task to the therapists and counselors.

The alternative is to keep the patient episodically on life support for the foreseeable future.
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MassWG
03:44 PM on 04/28/2012
I think mention of heart rate is important. We depend on faulty instruments (such as GDP) to decide what the "correct" heart rate should be - and we have been trying to boost it for decades to unnatural and unsustainable levels. We have done this by changing our focus from investment and production to debt and consumption. Time to start reversing the unhealthy regimens of financialization and globalization.
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LoneTree
Liberty is more precious than life.
09:16 PM on 04/28/2012
Will you be my Valentine? j/k, nice post, thanks.
iflew
Pro Publiae Bonae
02:01 PM on 04/28/2012
I liked the article. My concept of Economics was in attempting to apply the most efficient uses of resources. When I see the term "Health Economics" it looks like an Oxymoron. I guess everyone has one of something, and in this case it's an opinion.
01:26 PM on 04/28/2012
The medical board just happens to think that the individual should quit binging on junk food and subprime cuts of meat. Proactive not Reactive. The unhealthy diet keeps the cardiologist in business so why we he welcome lifestyle change? Youth and eldery dependant age groups get healthcare.....everyone else needs to suck it up and quit smoking, quit drinking eat right and exercise daily and you wont need healthcare.
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Richard Bartholomew
My micro-bio isn't empty.
12:21 PM on 04/28/2012
'He was rushed into intensive care, where eventually, his case was taken over by the medical teams of Obama and Bernanke. Dr. Obama, a cardiologist, applied stimulus to get his heart beating again, while Dr. Bernanke used angioplasty to clear the junk out of his veins so the credit blood could start circulating again.'

And who paid the bill for all of that? Take a good, long look in the bathroom mirror dear reader.
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Troutguy
A bad day fishing is better than a good day workin
12:40 PM on 04/28/2012
But wasn't it Doctor Bush who prescribed two upaid- for wars and giant tax cuts for what ailes our country? And the final bill still hasn't come from that operation. Open your eyes a little wider, won't you?
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HUFFPOST SUPER USER
Richard Bartholomew
My micro-bio isn't empty.
12:45 AM on 04/29/2012
And who paid, is still paying, and will continue to pay the bills for all of that? Take a good, long look in the bathroom mirror dear reader.

Vote Libertarian.
01:20 PM on 04/28/2012
To be fair, the article should read that the New Board and their totally ideology based health or anaologous economic theories, were what made the patient ill and caused the Sept 2008 collapse, yet now they sit on their party agenda of doing everything they can to make sure the patient does not recover so that maybe they have a chance in the 2012 elections. That would be fair.
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Richard Bartholomew
My micro-bio isn't empty.
12:46 AM on 04/29/2012
Vote Libertarian.
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HUFFPOST SUPER USER
Nic the wonder puppy
When life throws lemons, throw them back
11:38 AM on 04/28/2012
I'm only a dog but shouldn't health care be non-profit or at least treated the same as a utility ?
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LoneTree
Liberty is more precious than life.
03:19 PM on 04/28/2012
Maybe, but probably not.
HUFFPOST SUPER USER
Scientistengineer
Degrees in Physics (BS), Chemistry (MS.), and Mate
10:46 AM on 04/28/2012
Ah ..yes. the new Doctor also put him on a strict diet and exercise plan designed to strengthen his heart and drop his excess weight - leading to a full recovery. Will he follow the new doctor's advice - or continue in his profligate ways?
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BigBearcatBill
This is the real Bearcat - a Binturong
09:54 AM on 04/28/2012
Let's think more about the cost of getting that 60 million or so insured because running the numbers quick in my head it does not look like that much compared to a lot of other gov budget items: say 20 million of those are young adults 18-35 or so. Looking at those costs advertised by blue cross and Kaiser you see in the mailers coming every month, a cheap plan for them would be about $1000 per year a little under $100 per month. $1000/yr x 20 million = $20 billion per year....for the 35-50 folks probably double or triple that cost say about $50 billion per year for 20 million people. Now for $70 billion per year you have two thirds or 67% of the 60 million covered. My guess you round that off to $100 billion per year and you have covered about all of that 60 million, maybe the older say 50-65 age need to chip in half their coverage because they are the expensive group....Wa La for $100 billion/year and maybe the older pre-medicare folks paying half everyone covered now if we find that to take move over in budget or tax more for it...how about dropping Oil company subsidies...farm subisdies...increase IRS enforcment staff, CNBC documentary recently had IRS manager on saying they could collect $100-200 billion per year from tax evaders if better enforcement funded.
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LoneTree
Liberty is more precious than life.
03:22 PM on 04/28/2012
My experience is that the numbers won't work out that way. Look at Medicare when it started, then look at it now. Healthcare insurance is different from automobile insurance in that you can use the healthcare insurance (more or less, within reason) without adverse consequences. Whereas if you "use" your auto insurance, the bad things start happening right away.

Taking today's situation and multiplying it out ignores the kind of inflation that Medicare introduced to healthcare.
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BigBearcatBill
This is the real Bearcat - a Binturong
04:43 PM on 04/28/2012
Those are realistic costs and probably could be lower because those per person are what you see on those mailers coming out and that means they are big profits for blue cross or Kaiser and of course the medical system keeps wanting big profits for their hospital administrators and high paid staff. I think if the med system worked a little harder and maybe took a little cut out of their humongous profits and you turned it over to a public option where the managers/CEOs are not making humungous bonuses those number would be even cheaper. The difficult estimate is the over 50 age crowd because they already pay 5-10 times more than the young ones and also use hospital/care more. No doubt that if we wanted to we could go socialized medicine at least for a basic med care system for all, rich and any that want better can have Cadilac hospitals and clinics and pay for it with their insurance, it can be done for probably only a few dozen $billion more than the total USA payments for insurance and med treatment right now, who knows it may be cheaper since all those insurance jobs for CEOs and high paid managers would dissappear into GS-11 to GS-15 jobs that don't get big bonuses and max out at about $150K/year opposed to the $millions/year to CEOs.
09:12 AM on 04/28/2012
Doctors need to lead hospitals again. There is a growing trend for hospitals to promote former nurses, therapists, HR staff into administative positions, rather than senior physicians themselves. Doctors end up filling out time- consuming forms that secretaries or nurses (who are no longer accountable to the growing number of women and minority physicians) shoudl fill out, have no time scheduled for entering data into an emr after patient leaves, have no time for necessary meetings to coordinate patient care or teach medical students or residents what it all means. All the while admininstrators have doctors see more patients to support the administrators' salary that generates no hospital revenue from insurance, Thus, admininstrators have even more time carved out for themselves for meetings about meetings, paperwork, surveys/marketing leaving out the most important needs of individual patients themselves. When drs are not represented in hospital administration, the doctors end up working 3-5x times harder to pay for salaries of administrative staff who are not accountable to them and are frequnetly advocating against them. Most hospital CEOS will have a puppet CMO- the only doctor allowed to do brief face time with the board of trustees. There is no MD who cannot learn to do a better job in running a hospital with purpose of healing than any CEO who has never taken care of a patient. What other industry would allow someone with no experience, training, or insight about healing and medicine to lead it like an assemblyline?
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LoneTree
Liberty is more precious than life.
03:26 PM on 04/28/2012
"Doctors need to lead hospitals again"

I absolutely disagree. Nothing in a physician's background prepares her for setting economics and access driven policy. Healthcare, yes. Healthcare administration, absolutely not. When physicians design a healthcare system, it's designed first for the convenience and security of the physicians, second for the staff, third for the patients, and lastly for those who have to pay.

There's an old saying in my industry, "Never let a Captain run the steamship company".

Physicians are technical professionals who are hired for their particular expertise, which isn't management or financial expertise. Spend some time talking to physicians, you'll be amazed at how naive most of them are, outside their field.
07:52 PM on 04/28/2012
Youve obviously never been part of a meeting ( as I have) where the hospital CEO tell the doctors not to dc patients since "although it may be good for the patient and family, our hospital fiscal budget requires a longer length of stay, so your jobs depend on not discharging the children in this hospital" .. or "drs shoudl not follow patients after hospital dc since it is not cost effective to provide outpatient services compared to inpatient..."... or "we need a medical home model bc there is reimbursement for it but how do we get a medical home status without providing continuity of care since that is not cost effective." also the doctors I trained and worked with never watched cable TV while attending a meeting of doctors, therapists and social workers, unlike the CEO. Medicine is a profession of healers. We communicate with each other. Those who are part of this calling are professionals. In many societies, especially those in which women are respected ( ie countries in which women prime ministers and men of color as president are not an anomaly ), that healers and teachers lead society because they are accountable to students and patients. these are the countries that will be leading the world in the future while American businessmen with stakes in fast food industry lead our hospitals.
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BigBearcatBill
This is the real Bearcat - a Binturong
09:08 AM on 04/28/2012
Jared just for the fun of it, if fed or state govs took over the Insurance company job of doling out the payments to hospitals and providers, how much money would be saved from just the salary difference of say a CEO and their managers of ins company and the GS-15 or whatever would do the CEO job and the mid level managers that wuold replace their managers? My guess is that would cover a lot of the cost to get the other folks into a hypothetical Single Payer /gov option system.
08:44 AM on 04/28/2012
Who should we vote for? its a given that we can't vote for republicans ..but what about this ????
Democrats who voted against the health care bill included the following Congressmen and Congresswomen:

Rep. John Adler (N.J.)
Rep. Jason Altmire (Pa.)
Rep. Michael Arcuri (N.Y.)
Rep. John Barrow (Ga.)
Rep. Marion Berry (Ark.)
Rep. Dan Boren (Okla.)
Rep. Rick Boucher (Va.)
Rep. Bobby Bright (Ala.)
Rep. Ben Chandler (Ky.)
Rep. Travis Childers (Miss.)
Rep. Artur Davis (Ala.)
Rep. Lincoln Davis (Tenn.)
Rep. Chet Edwards (Texas)
Rep. Stephanie Herseth Sandlin (S.D.)
Rep. Tim Holden (Pa.)
Rep. Larry Kissell (N.C.)
Rep. Frank Kratovil (Md.)
Rep. Dan Lipinski (Ill.)
Rep. Stephen Lynch (Mass.)
Rep. Jim Marshall (Ga.)
Rep. Jim Matheson (Utah)
Rep. Mike McIntyre (N.C.)
Rep. Mike McMahon (N.Y.)
Rep. Charlie Melancon (La.)
Rep. Walt Minnick (Idaho)
Rep. Glenn Nye (Va.)
Rep. Collin Peterson (Minn.)
Rep. Mike Ross (Ark.)
Rep. Heath Shuler (N.C.)
Rep. Ike Skelton (Mo.)
Rep. Zack Space (Ohio)
Rep. John Tanner (Tenn.)
Rep. Gene Taylor (Miss.)
Rep. Harry Teague (N.M.)

Now what?
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12:05 PM on 04/28/2012
"Now what?"
Take the time and trouble to find out why they voted as they did,
before one goes off half cocked.

Among the reasons:
--total lack of support and promotion by the president for blue dogs in purple and red states,
--serious flaws in the bill admitted even by opponents
--lack of reliable controls that would make the bill financially viable,
--projected costs are known to be always over-optimistc and are proving so now--premiums may be impossible to afford by the time the program is fully implemented.

-- and always approach a complex subject with humility.
08:24 AM on 04/28/2012
"Then, in the 2010 midterms, the hospital elected a new board that was strongly against such medical interventions as those benefiting our client. They yanked out the stimulus tubes and discharged him."

And ever since 2010 we've seen job growth right?
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HUFFPOST SUPER USER
chancho24
Any emotion, if it is sincere, is involuntary.
09:15 AM on 04/28/2012
lmao....
10:10 AM on 04/28/2012
Well it's true isn't it?
10:21 AM on 04/28/2012
Nope, the party of no won't let it happen. It's time for austerity they say. Join me and vote out all the pubs.
11:32 AM on 04/28/2012
Austerity you say?

How much has the budget been cut the last 2 years?

Answer, none, it's increased.