Victor Fuchs- Prospects for Health Reform

I wish to bring to your attention an interview with Victor Fuchs, PhD, professor emeritus of Stanford University. The interview appears in the September 19 issue of The Health Care Blog (thehealthcareblog.com). Matthew Holt, former student of Fuchs and cofounder of the Health Care Blog, conducted the interview with Fuchs, who is known as the “Father of Health Economics.”

The interview is a worthwhile read.

Here are a few things I took away from it.

• More than 80% of Americans are now living past 65. This demographic reality changes everything, from Social Security, to Medicare, to taxes on the young, to how to pay for health reform.

• Emphasis on health care technologies and demand for these technologies is shifting from prolonging life to improving the quality of life. People want to live better, more productive lifes, not just longer lifes.

• To save and sustain the American health care system will require more revenues, e.g. , from a Value Added Tax (VAT), and more organizational changes, e.g. Accountable Care Organizations and Medical Homes. These requirements will require the system to stress value and outcomes and discourage independent fee-for service payments and volume of services offered.

• The current health reform law is more about insurance reform, a much easier and changeable target, than health reform, which requires behavioral and cultural changes, both notoriously refractory to change.

• American culture, since De Tocqueville, has responded to crises with sudden change – the Emancipation of slaves, the $1 trillion bailing out of financial institutions– rather than a rational processes. True health reform will most likely come from a crisis – a World War, depression, or national bankruptcy.

• Fuchs is pessimistic about prospects for true reform, as seen from his Stanford perch. He says the current “fractionated system of messages” from talk show hosts, bloggers, and the inefficient, partisan, political system spread confusion and re-enforce negative opinions. Theser factors makes what needs to be done – fundamental changes in the 3I’s (Information, Infrastructure, and Incentives) difficult to carry out. Fuchs concludes, “The whole thing, you might say, is a mess…Given the way it is and given the other obstacles, I think the chance of these things working out are very small until the country gets into some kind of crisis situation.”

Concluding Remarks

What Professor Fuchs says does not surprise me. He has said it often and well in recent New England Journal of Medicine articles and in his classic little book Who Shall Live (1974). His tone combines realism and pessimism. It rests on his deep knowledge and his witnessing of repeated , failed reform efforts during his 86 years. In this interview, he does not dwell on the main forces blocking Fuchs-style reforms – America’s inherent conservatism, its deep distrust of Big Government, its skepticism over external management solutions, and its desire for retention of individualism and the status quo.