This is a two-part answer. Both have essentially identical cost containment mechanisms. But will these mechanisms have a material impact on costs?
Here’s my take.
Pools – both look to reduce administrative expenses by providing insurance thru and ‘managing’ insurers by centralized insurance buying pools. Both would set up national mechanisms – Clinton thru the existing FEHBP and Obama via a new Health Insurance Exchance. My take – this will help cut admin costs by a few points.
Disease prevention – relatively minor policy differences – both will require coverage of preventive care and increase funding for some public health initiatives. My take – this should help reduce costs – but over the long term – by spotting disease early, thereby reducing cost of treatment. It will also improve GDP as the early detection will prolong lives of workers. Costs may well increase somewhat over the near term as the previously uninsured get lots of care for all their newly-discovered conditions.
High cost cases – Obama will reimburse employers for a portion of an individual’s over a per-person threshold if the payer uses the funds to reduce premiums. Clinton’s plan is silent on these. My take – no impact on costs. I don’t like risk transfers, as there is no incentive for the primary risk taker to manage cases which they think will become high-cost, and no incentive once these cases have pierced the threshold.
Chronic disease management – here’s where the big dollars are, and both plans miss the target by wide margins. Both set up medical homes where (I assume) patients with chronic conditions (of high acuity) could be treated.
Technology – both will drive adoption of electronic health records and data exchanges. My take – Over the long term, this should drive down costs significantly – fewer repeat test, much better coordination of care for those with multiple conditions seeing multiple providers.
Tort reform – Notably, both co-sponsored a national medical error reporting bill in 2005. Clinton will reduce potential awards for providers who comply with medical error disclosure; Obama looks to ‘reform medical malpractice’, but how is unclear. My take – Medical malpractice contributes much less to costs than many think; the impact of either will be minimal to unmeasurable.
Drugs – both allow reimportation, would (likely) negotiate directly with drug companies to reduce prices for federal beneficiaries; Clinton adds limits on DTC advertising while Obama would further promote generics. My take – the direct negotiation would likely significantly reduce costs for the Federal programs.
Best practices – Obama backs an ‘independent institute’ to research drug and device efficacy; Clinton calls for a ‘best practices institute’ (we sort of already have one, or rather had one in AHCPR, which ran into the physician lobby buzzsaw some time back) My take – this could have significant benefit over the long term, if it is adequately funded and assertively supported.
The net is this – I’d have to agree (mostly) with Bob Laszewski – either plan will help control costs, and there’s little difference between the two.
But, and here’s the ‘big but’, the Dems do have plans, while McCain‘s is not much more than more of the same.
I agree with virtually
every line of your analysis.
I don’t think any health reform plan is going to save big money upfront.
Longer term, chronic disease management and comparative effectiveness research could produce enormous savings–if, as you say, the institute is given better protection from lobbyists than AHCPR received.
But at the beginning, universal coverage is going to require serious seed money–to cover everyone, to held fund electronic medical records,
to set up the comparative effectivness research institute.
Too many people pretend that with national health reform, healthcare will suddenly, magically, become less expensive–and that’s just not true.
The most likely outcome of universal coverage initiatives proposals at the Federal levels in the 1st 4 years of the next president’s term is more funds for State based initiatives. I have my doubts that there is enough political will/ true concensus on solutions among democrats or republicans for more rapid progress. Addressing health system issues is rapidly becoming a priority for Republicans as well as Democrats
Bill Walsh
I agree with much of your analysis, but think that the candidates — and you — are overstating the value of purchasing pools. As studies by the California HealthCare Foundation and others have documented, unless they’re mandatory (everyone must buy coverage only through the pool) they don’t work. They certainly don’t cut costs.
And making pools mandatory, for a host of reasons, does more harm than good.
Whether you call them purchasing pools, conntectors or exchanges, they sound good, but tend to perform badly.