Friday, November 17, 2006

It's Health Care Costs, Stupid

The financial group PricewaterhouseCoopers recently released a report on projected health care costs in the upcoming year.

Here's the breakdown of expectations:
  • Preferred Provider Organizations (PPOs): +11.9 percent
  • Health Maintenance Organizations (HMOs): +11.8 percent
  • Consumer-Driven Health Plans (CDHPs): +10.7 percent
Is it really any wonder why the cost of operating public and private entities is increasing dramatically each year?

Sure, you can put the burden on the workers to foot the bill. But are they really in any better of a position to afford it than their employers?

As Rep. Jon Richards (D-Milwaukee) -- the author of one of the three comprehensive health care reform proposals before the state legislature -- notes: "We cannot continue to tinker around the edges of health care reform, we need big solutions."

2 Comments:

Anonymous Anonymous said...

Seth:
Interesting perspective on health care. Perhaps more focus on quality (reducing hospital medication errors, fraud, infections, etc.), costs (rate controls on hospitals and insurers and certificate of need regulations for expensive equipment and hospital expansions)and how providers are reimbursed (i.e. move away from paying for quantity of services and towards outcome based purchasing) would be more useful in addressing the problem of rising health care costs, versus shifting the expenses around to other payors (which providers would be happy to do).
Note: your link to the Pricewaterhouse Coopers report did not connect.
Thank you.

November 28, 2006  
Blogger Seth Zlotocha said...

Thanks for your comment.

Your suggestions for focus on quality, lowering purchasing costs, and changing reimbursement are useful, but I prefer to see a more fundamental change to the structure of the system. I've discussed before consolidating payers as the best route to go, either going with a tiered system for health plans as the State of Wisconsin currently uses for employees, or moving to a single payer for primary care and multiple payer scheme for supplemental care (which is what they do in France). This would have the effect of reducing the bloated administrative costs that bog down our current system and it would also increase the purchasing power of payers in the system (although the rates don't need to be as abysmally low as Medicaid).

And here's that link again for the PricewaterhouseCoopers report -- sorry, Yahoo doesn't keep its news stories up very long.

November 28, 2006  

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