The medical and insurance lobbies (and their political
allies) have a pretty standard refrain about their problems in life. Heath care costs are high because
doctors order unnecessary tests and they do it for one reason - they’re
afraid they’ll be sued. Insurance is highly regulated, so weak and ineffective state regulation isn’t
causing rate hikes – it’s lawsuits.
Too bad when the facts starting getting in the way. Last night, 60 Minutes repeated their earlier eye-opening segment about the largest driver of health care costs: end of life treatment. Conspicuously absent? Any mention of “defensive medicine.” 60 Minutes reported:
Last year, Medicare paid $55 billion just for doctor and hospital bills during the last two months of patients' lives. That's more than the budget for the Department of Homeland Security, or the Department of Education. And it has been estimated that 20 to 30 percent of these medical expenses may have had no meaningful impact.…
Most of the bills are paid for by the federal government with few or no questions asked. [M]odern medicine has become so good at keeping the terminally ill alive by treating the complications of underlying disease that the inevitable process of dying has become much harder and is often prolonged unnecessarily.…
What’s more, “there are other incentives that affect the
cost and the care patients receive. Among them: the fact that most doctors get
paid based on the number of patients that they see, and most hospitals get paid
for the patients they admit.… ‘So, the more M.R.I. machines you have, the more
people are gonna get M.R.I. tests?’ [Steve Kroft asked.] 'Absolutely,' [Dr. Elliott Fisher, a researcher at the Dartmouth
Institute for Health Policy] said."
(Yup, we’ve said that before. Check out some other things Dartmouth has said.)
Then we have a story from the Chicago Tribune
today about the fact that people are finally waking up to the fact that
insurance regulation – which is handled by states - is generally pretty feeble
(as we’ve noted).
As Americans struggle with double-digit hikes in their health insurance bills, millions are coming up against a hard reality: The state regulators that are supposed to protect them can often do little to control what insurers are charging.
In many states it is the insurance industry that largely controls the regulatory process, funneling money to key state lawmakers and squelching efforts to expand government oversight of premiums, a review of state regulations and campaign donations shows.
"The pressure that the industry can bring to bear in state legislatures is unbelievable," said J. Robert Hunter, a former insurance commissioner in Texas. "They pretty much get what they want."
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