red states rule
06-05-2009, 06:01 AM
Obama has beentelling us how his goal with government run healthcare would reduce the cost of healthcare :laugh2: :rolleyes:
However, after running the numbers, the CBO finds that Obama's master plan does not save money
Anyone surprised? Anyone shocked?
Shooting the Messenger: CBO in the Crosshairs
By Andrew G. Biggs
Thursday, June 4, 2009
Filed under: Government & Politics, Economic Policy, Health & Medicine
snip
The official scorekeeper for health reform legislation in Congress has stated that the overhaul proposed by the administration could increase costs. What to do? Shoot the messenger.
So, in CBO director Doug Elmendorf’s March testimony before Congress, he says, for instance:
The adoption of more health IT is generally not sufficient to produce substantial savings because the incentives for many providers to use that technology in ways that control costs are not strong . . .
. . . Generating additional information [through comparative effectiveness research] is likely to have a very limited effect on spending for healthcare.”
In an earlier analysis of the academic literature on disease management, CBO said:
There is insufficient evidence to conclude that disease management programs can generally reduce overall health spending.
The key to lowering costs, Elmendorf stressed, is changing incentives. His testimony used the word “incentives” 33 times, by my count. Both the income and payroll tax exclusion for employer-sponsored healthcare and the third-party payer structure of most health coverage encourage patients to demand services and doctors to provide them even if the value of those services does not exceed their cost. The result: high costs and wasteful treatment.
The rational response to CBO’s arguments would be to focus more on improving incentives. The actual response? Bash CBO. A spreading meme on the political left is to focus on CBO’s role as the scrooge in the healthcare play, and on how CBO’s lack of vision and insight threatens to spoil a good time for everybody.
The Washington Post’s Steve Pearlstein takes on the “budget scolds” at CBO, saying the agency’s refusal to play along “will leave Congress with no choice but to try to finance its health-reform efforts by raising taxes or limiting payments to doctors and hospitals, possibly jeopardizing the entire project.” But unless the administration is willing to either radically change incentives in a free market direction, or use heavy-handed cost containments that would surely doom the proposal politically, those are the choices it faces.
Likewise, The New Republic’s Jonathan Cohn bemoans “the bean counters who could kill healthcare reform,” saying that despite prodding from former CBO Director Peter Orszag, now Obama’s budget chief, CBO analysts are not projecting the kinds of savings the left would like to see.
http://www.american.com/archive/2009/june/shooting-the-messenger-cbo-in-the-crosshairs
However, after running the numbers, the CBO finds that Obama's master plan does not save money
Anyone surprised? Anyone shocked?
Shooting the Messenger: CBO in the Crosshairs
By Andrew G. Biggs
Thursday, June 4, 2009
Filed under: Government & Politics, Economic Policy, Health & Medicine
snip
The official scorekeeper for health reform legislation in Congress has stated that the overhaul proposed by the administration could increase costs. What to do? Shoot the messenger.
So, in CBO director Doug Elmendorf’s March testimony before Congress, he says, for instance:
The adoption of more health IT is generally not sufficient to produce substantial savings because the incentives for many providers to use that technology in ways that control costs are not strong . . .
. . . Generating additional information [through comparative effectiveness research] is likely to have a very limited effect on spending for healthcare.”
In an earlier analysis of the academic literature on disease management, CBO said:
There is insufficient evidence to conclude that disease management programs can generally reduce overall health spending.
The key to lowering costs, Elmendorf stressed, is changing incentives. His testimony used the word “incentives” 33 times, by my count. Both the income and payroll tax exclusion for employer-sponsored healthcare and the third-party payer structure of most health coverage encourage patients to demand services and doctors to provide them even if the value of those services does not exceed their cost. The result: high costs and wasteful treatment.
The rational response to CBO’s arguments would be to focus more on improving incentives. The actual response? Bash CBO. A spreading meme on the political left is to focus on CBO’s role as the scrooge in the healthcare play, and on how CBO’s lack of vision and insight threatens to spoil a good time for everybody.
The Washington Post’s Steve Pearlstein takes on the “budget scolds” at CBO, saying the agency’s refusal to play along “will leave Congress with no choice but to try to finance its health-reform efforts by raising taxes or limiting payments to doctors and hospitals, possibly jeopardizing the entire project.” But unless the administration is willing to either radically change incentives in a free market direction, or use heavy-handed cost containments that would surely doom the proposal politically, those are the choices it faces.
Likewise, The New Republic’s Jonathan Cohn bemoans “the bean counters who could kill healthcare reform,” saying that despite prodding from former CBO Director Peter Orszag, now Obama’s budget chief, CBO analysts are not projecting the kinds of savings the left would like to see.
http://www.american.com/archive/2009/june/shooting-the-messenger-cbo-in-the-crosshairs