Tag: Supreme Court

Thoughts on the Supreme Court decision on Obamacare

~ neupert ~ 2 Comments

One can’t have a serious health blog and not discuss the Supreme Court decision to uphold most of Obamacare.    My initial reaction was real disappointment — because I truly believe the law is a bad law and bad for the future of our country.   I am not a lawyer and Roberts’ logic seems somewhat tortured, but after reading several legal blogs on the topic — I believe Roberts was sincere and apolitical in his reasoning and I support the outcome and the process.

As I have written previoulsy, the real problem is Obamacare does little to solve the true health care crisis in our country.   Worse, the political dialog regarding Obamacare has done nothing to educate the citizenry about the dysfunctional health system which could have enabled a more sustainable set of solutions.

There are three pillars — Access, Cost and Quality — that are part of any discussion for improving our health care system.   They are all important and intertwined.   Obamacare primarily deals with Access (individual mandate, pre-existing conditions, insurance exchanges etc.) but it does nothing meaningfuj and systematic to improve either Cost or Quality.   The biggest issue in our healthcare system is economic — we are not getting sufficient Value out of our huge healthcare spend (Value = quality of health outcomes – cost over time).   For example, the IOM and other experts believe that 30+% of our $2.2 trillion of spend is wasted — that is $750B annually!!!    The only sustainable solution to increasing Access is to make health care more economically affordable, which requires an improvement in Value, which requires changing the way the system is organized and incentivized.  Obamacare does not do this and in fact, probably makes things worse re: affordability and sustainability.   Increased Access to insurance within the current framework obviously does not drive or improve affordability — or we would not have the unsustainable health care cost trend we do.

I will develop further the themes of Value and affordability in future blogs.  This WSJ op-ed is a good start.   My strongly held personal belief is that free enterprise, marketplaces and competition amongst providers and payers is much more likely to improve Value and affordability than more government rules and bureaucracy.

Which leads me to my biggest concern resulting from the Obamacare political debate…which is; is our country headed more toward socialism vs. our traditional strength of ‘free markets and free peoples’.    As Chief Justice Roberts noted in his opinion — it is not the job of the Supreme Court to “protect the people from the consequences of their political choices.”

The real fight for ‘health reform’

~ neupert ~ Leave a comment

Last week ‘health reform’ was in the news because of the three days of hearings in the Supreme Court.   I believe the Obamacare law raises some very fundamental questions about the scope and role of the Federal government.    I was delighted that the country is finally having a conversation about the core issues raised by the law – a debate that should have happened during the legislative process.

Here are some of my favorite posts:

However, I found this WSJ article detailing the nasty battle between UPMC and Highmark to be way more telling about the future of the health delivery system.   There are many dimensions to the battle over customers, physicians and dollars that are interesting.   One paragraph in the article I found particularly fascinating:  “Early talks between the companies hadn’t gotten far. Highmark has said UPMC initially sought a 40% increase in its hospital rates. Mr. Romoff doesn’t dispute that but says it was a fair boost to make up for inadequate payments under the old pact with Highmark.”    Pricing power matters a lot in the health economy and having a good brand and substantial market share dramatically increases pricing power – which has been UPMC’s strategy.   What is unique about the health marketplace is that there are limited checks and balances to this market power – at either the payer or provider level, because the consumer of the service is not engaged and empowered to ‘shop around’ for value.

My view is – without pervasive price transparency, ubiquitous quality reporting and material economic incentives for consumers to be smart shoppers (where applicable) – ‘health reform’ will unfortunately lead to neither increased ‘value’ in the health economy nor bend the cost curve.

p.s. update — Highmark CEO fired.   Not germane to the discussion — but felt the update necessary.