Saturday, January 5, 2013

Victor Fuchs on health reform

I've never met Victor Fuchs, but I've admired and learned from his writings for years. His article in this week's JAMA on "How and Why US Health Care Differs From That in Other OECD Countries" is a gem. Here's a summary:

US expenditures differ from the average OECD country in three ways:
  1. As a percentage of GDP, US expenditures are twice as high.
  2. The share of expenditures funded by government in the US is 46%, compared to a 75% average for other OECD countries.
  3. The mix of services differs substantially - intense focus on technology vs more basic care.
Here's how Fuchs explains the difference, again in a series of three:
  1. The US population has a much more distrustful attitude towards government - a trend with deep historical roots.
  2. The US population is much less committed to equal outcomes through redistributive policies.
  3. The US political system provides many "choke points" that allow special interests to block or reshape reform efforts.
Finally, Fuchs draws three practical conclusions for future reform efforts:
  1.  "[G]overnment's role should be limited to what is necessary, not just desirable."
  2. "[P]rovision of basic coverage for all should not require equality for obtaining additional coverage...individuals should be free to purchase more than basic care."
  3. "[R]eform should have features that would appeal to some special interests, or to some elements within each special interest group."
Fuchs, who is presumably in his mid 80s (he graduated from NYU in 1947), is giving us the gift of his wisdom. His two page JAMA piece ends this way:
Comprehensive health care reform in the United States is necessary to avoid a financial disaster, but enactment of such reform will require attention to US history, values, and politics."
Fuchs' analysis is relevant for liberal critics of the Affordable Care Act. In the eyes of single payer advocates and other progressives, the ACA is a disappointing flop. But by Fuchs' three practical conclusions, the ACA was the best that could be achieved in 2010. The right approach for progressives is to do all we can to make it work.

6 comments:

Roy M. Poses MD said...

IMHO, Fuchs' article was very curious.

It seems to me that the biggest difference betweeen the US health care "system" and those of other developed countries is the extent that is is commercialized. I suspect no other country has largely commercial health insurance, a large for-profit hospital sector, large numbers of for-profit corporations that provide specialized health care (hospices, dialysis, mental health etc), and increasing numbers of doctors providing direct health care as employees of such corporations. (See: http://hcrenewal.blogspot.com/search/label/corporate%20physician)

Furthermore, we allow such commercial organizations to dominate local markets.

Finally, this commercial domination has occurred at a time when the dominant management philosophy focuses on increasing "shareholder value," but which is defined as increasing stock prices in the short-term, and operationalized to mean putting short-term revenue ahead of all other concerns, including the well-being of patients. (See: http://hcrenewal.blogspot.com/2012/04/health-care-dysfunction-explained-by.html)

While Americans have been traditionally distrustful of big government, at least since the Gilded Age, many have also been distrustful of big business when it becomes too big. After all, it was Teddy Roosevelt who warned of malefactors of great wealth.

Yet the most noteworthy recommendation by Fuchs is essentially appeasement... of some "special interests," and thus, of some of these large, for-profit, and sometimes market dominating firms that may be run by today's malefactors of great wealth.

This does not appear to be a recipe for meaningful health reform, or one that ought to be embraced by anyone who distrusts the concentration of power, be it in government of big corporations.

Jim Sabin said...

Hi Roy

As always, it's good to hear from you. Your Health Care Renewal blog (written with others) continues to be the "go to" site for examination of the impact of commercialization on health care and medical ethics.

I don't know Victor Fuchs, but from his writings I expect that he would agree with your view of the US system as vastly over-commercialized, and that commercial dominance is one of the major causes of the three distinctive features of the US system.

Unfortunately for all of us who would like to see a stronger public role in the health system, US distrust of government goes back to before the founding of the Republic. It's VERY deep, as reflected in the famous comment from a senior who begged her Senator to "keep the government from getting its hands on my Medicare."

I believe the not-for-profit corporate form can lead to better quality and lower cost. I experienced this directly at the physician-led Harvard Community Health Plan/Harvard Vanguard Medical Associates.

With regard to Fuchs' comment about the need to appeal to some special interests, I think he's being a political realist. The example he gives in his article is "some physicians or some health plans." He's following the precept of not letting the perfect be enemy of the good. The ACA has changed the layout of the health system. I hope that in the next 5 years we'll see effective leaders use the new opportunities to show how to produce better care for the population at a lower cost.

As I've done before, I want to encourage readers of this blog to follow Health Care Renewal as well.

Best

Jim

Roy M. Poses MD said...

See a longer version of my concerns about what Fuchs left out, and why we should not further kow tow to special interests here:

http://hcrenewal.blogspot.com/2013/01/why-did-dean-of-health-care-economics.html

I could argue that we have been giving ground to "special interests" for 30 years, and that is why health care, and the country in general, is in such a mess.

The real question is why Fuchs seems so blissfully unaware of these issues.

Jim Sabin said...

Hi Roy -

I'm sorry for the delay in posting your comment and responding.

Readers - I encourage you to go to Health Care Renewal to see Roy's extensive analysis of ways in which the commercialization of health care has led to worse care, worse health, and higher costs.

That said, I'd hold to the view that Victor Fuchs might well agree with much of what you say in your post, but would respond: "the issue I'm discussing isn't what is ideally most desirable, but how activists can best improve the situation in the real world. If we fight all "special interests" at once, we won't get anywhere. Divide and conquer."

In my view, progress requires the kind of vision Health Care Renewal has presented over time and practical political strategizing of the kind Lyndon Johnson and Ted Kennedy were so adroit at.

Best

Jim

hazelmae89 said...

Is this really true:
"The share of expenditures funded by government in the US is 46%, compared to a 75% average for other OECD countries."

Thanks,
pharmacist salary

Jim Sabin said...

Dear Hazelmae -
There are different ways of calculating health care expenditures, but I trust Victor Fuchs as a long time expert on health policy. Even though the percentage of health expenditures paid for by the government is lower in the US, our costs are so much higher that the government spends more than the OECD countries, and we as individuals and our employers also spend much more.
Best
Jim