Obama Seems To Understand The Fault Of Government In Creating The Health Care Crises

I applaud him for admitting that the destructive incentives embedded in the payment models, and codified by the Medicare National Bank, are to blame for the out of control health care spending in this country.  As he states:

Obama said the best way to drive down health care costs is to persuade doctors and hospitals to emphasize quality of care over the quantity of procedures.

Health experts have long criticized formulas that tie Medicare payments to tests and other services that may not always be the best way to treat a patient. Obama said the formulas must change as part of his bid to overhaul U.S. health care delivery.

You see, we are getting exactly the kind of health care the payment models are set up to pay for.  There is no such thing as an unnecessary boob job.  If the patient is willing to pay for it, and the surgeon is willing to perform it, the result is the right care at the right place for the right price at the right time.  

As it stands now, the Medicare National Bank is being bankrupted by an irrational payment model (the RVU system)  that is entirely built upon the back door secretive politics heavily controlled by specialty medical societies that try to protect each others own special interest in the revenue neutral,  irrational economics of RVU/RUC/SGR/Medicare Part B.

The whole thing is a sham.  It is impossible to get to WIN-WIN when the only possible outcome for every winner is a loser.   

This is why any government that attempts to set prices on goods and services, including health care, is doomed to fail.  While I applaud Obama for realizing the failed economies and all the irrational, yet so rational, consequences of government intervention on price, I fear his solution, which he has yet to provide, will offer nothing more than a different set unintended consequences.  No centralized agency will ever price a product better than 300 million Americans can.  With that, I have another proposal to consider in the financing of American health care.  You'll have to read my next post to understand how simple this could be.