Sunday, September 21, 2008

Obama's Health Care Plan

Oh, dear. I've been away so long, it's hard to know where to start.

Here's one thought.

I found the link to this Wall Street Journal article on my favorite economist's blog, Brad DeLong's Semi-Daily Journal

Why Obama's Health Plan Is Better -

Sen. Obama's proposal will modernize our current system of employer- and government-provided health care, keeping what works well, and making the investments now that will lead to a more efficient medical system. He does this in five ways:
- Learning. One-third of medical costs go for services at best ineffective and at worst harmful. Fifty billion dollars will jump-start the long-overdue information revolution in health care to identify the best providers, treatments and patient management strategies.
- Rewarding. Doctors and hospitals today are paid for performing procedures, not for helping patients. Insurers make money by dumping sick patients, not by keeping people healthy. Mr. Obama proposes to base Medicare and Medicaid reimbursements to hospitals and doctors on patient outcomes (lower cholesterol readings, made and kept follow-up appointments) in a coordinated effort to focus the entire payment system around better health, not just more care.
- Pooling. The Obama plan would give individuals and small firms the option of joining large insurance pools. With large patient pools, a few people incurring high medical costs will not topple the entire system, so insurers would no longer need to waste time, money and resources weeding out the healthy from the sick, and businesses and individuals would no longer have to subject themselves to that costly and stressful process.
- Preventing. In today's health-care market, less than one dollar in 25 goes for prevention, even though preventive services -- regular screenings and healthy lifestyle information -- are among the most cost-effective medical services around. Guaranteeing access to preventive services will improve health and in many cases save money.
- Covering. Controlling long-run health-care costs requires removing the hidden expenses of
the uninsured. The reforms described above will lower premiums by $2,500 for the typical family, allowing millions previously priced out of the market to afford insurance.

Note that in every way, this is designed to reduce health care insurance premiums for both individuals and employers.