The Other Side of the ObamaCare Argument

Protagoras asserted that there were two sides to every question, exactly opposite to one another.

Diogenes The Cynic (400 BC to 425 BC)

I am not a cynica one-sided l man.  I like to read both sides of the argument.   Lately I’ve been harping on why ObamaCare is in trouble.    There’s another side, less frequently heard following the healthcare.gov and  health plan debacles – that the health law is  doing one thing it set out to do, lower costs.

David Cutler, a Harvard economics professor and a President Obama advisors, indeed one of the architects of ObamaCare, holds this point of view.  

I interviewed him professor Cutler  for my 2005 book Voices of Practical Health Reform.  The title of the interview was “The Path to Reform May Lie in Paying More for Quality Care”. He had just written a book Your Money or Your Life (the old Jack Benny Line uttered by a robber who held Benny at gunpoint). 

In his book and the interview, Cutler argued, by spending  more money on appropriate care, in particularly quality care and preventive care, by standardizing  care and reducing  regional variation, by  rewarding  value rather than volume, be having  computers at the point of care, and by universaling care, we could actually save money. These thoughts are embedded in the health reform law.

In yesterday’s Washington Post, with one caveat,  the botched rollout.  the reform law has succeeded in lowering costs (“ Health-Care Law’s Success Story: Slowing down Medical Costs,” Washington Post, November 6, 2013). Of the rollout, he says “The administration needs to make personnel and management changes to get enrollment back on track.”

The law, he says, had two overarching goals – cover almost everyone and slow cost growth.    It still short of the first goal, but has succeeded on the second, to wit:” Since 2010, the average rate of health-care cost increases has been less than half the average in the prior 40 years.”

He attributes a small part  of this slowing of costs  to the lingering recession, but mostly  to ObamaCare policies. As evidence, he cites these developments,

·         ACA has lowered the annual increases  Medicare pays to hospitals, home health agencies and private insurance plans

·         it has lowered hospital readmission rates;

·         it has eliminated services that are not needed;

·         it has helped create 500 accountable care organizations, which now serve 10% if Medicare recipients and result in “shared savings: by hospitals and doctors for Medicare. 

 In my opinion, some  of these developments are real, some remain theoretical. For example, the jury is still out whether ACOs lower costs.

But I hope and pray Dr. Cutler is right, that in the long run that these various aspects will collectively will lower costs.

Tweet:   Doctor David Cutler, a Harvard economist and one of ObamaCare acrhitects, argues that the health law has lowered overall health care costs.