Paul Krugman: Coverage and costs

[SpartanDem]

The usual suspects are out in force on the op-ed pages, declaring that the health reform bill doesn’t control costs, it’s a huge cost, etc.. And I had a new thought: part of what’s going on here, aside from the fact that these people just hate the idea of expanding social insurance, is that they haven’t looked at all at the actual numbers involved.

The theory of the reform is as illustrated above. Expanding coverage will, other things equal, increase health care spending. But the expansion of coverage is linked to a serious effort to control cost growth that will, one hopes, “bend the curve”, so that costs eventually fall below what they would have been otherwise.

What the bah-humbug crowd insists is that this is highly implausible; implicit or explicit in this claim is the idea that covering the uninsured is extremely costly. But it isn’t.

The key thing to understand in the coverage debate has always been that it costs surprisingly little to cover the uninsured. For the most part, the uninsured are relatively young, and hence have relatively low medical costs. Also, they receive a fair amount of uncompensated care, as well as spending funds out of pocket. So even if you ignore the possible monetary gains from preventive care, avoiding emergency room visits, and so on, we’re not talking about a vast rise in health care spending.

Take the CBO estimate of the cost of subsidies and Medicaid expansion in the Senate bill — that is, ignoring all possible cost savings. It’s $179 billion in 2018. Take the CMS projection of total health care spending in 2018: it’s more than $4.5 trillion. So the direct cost of expanding coverage — the initial bump in the blue curve above — is less than 4 percent of total health care spending. That’s the amount by which, on the current trajectory, health spending rises every 7 months.

http://krugman.blogs.nytimes.com/


Debunking another myth that the bill has no cost controls.

[NJmaverick]

1. Facts, figures and graphs- A good combination

[grantcart]

2. Krugman and Klein

Saunders, Brown, Franken, Rockfeller


vs


Hatch, McConnell and the biggest group of liars to have graced the Senate since the civil war.



This is a tossup

[Kurt_and_Hunter]

3. K&R as a worthwhile element of a rounded debate

[TheKentuckian]

4. Yup, just nothing much as far as price controls or choice failing a public program

My concerns on this are always answered by pointing elsewhere and talking about the historic nature of the effort but never addressed other than we'll get 'em next time, date utterly uncertain.

[Hello_Kitty]

5. Gee, I wonder how it would look if preexisting conditions had to be covered now and not in 2014

That delay, right there, is a cost control, and was done to make the CBO score look better.

[GeorgeGist]

6. The usual suspects are still shilling for the capitalists.

I just love graphs with no units.

[ClarkUSA]

7. Do you have proof of your one-line rhetorical caricature? Perhaps you have better graphs?

:shrug:

[SpartanDem]

9. Way to back your argument with facts

instead of empty catch phrases

[Vinnie From Indy]

8. Krugman is brilliant and his views are worth considering, but

I think Paul is simply missing the boat on this one. It isn't so much that his math is wrong, it is that he bases all of his numbers and projections on a flawed, fundamental premise. His projections are meaningless because they rest squarely on the idea that the health insurers are actually going to implement this bill in good faith. They have no intention of doing ANYTHING other than making as much money as possible. They will slice and dice any of these provisions using already well established mechanisms and new ones they have undoubtedly crafted to address the things they do not like in the new bill. It is the reason their stocks are skyrocketing. Paul is a brilliant commentator, buit he is a bit naive if he thinks these health insurers will sacrifice a single dime doing the right thing. They won't.

[Skittles]

10. VINNIE NAILS IT

:thumbsup: