10/2002 The Pulse

Published November 1, 2002

Let’s rev up those engines by starting with a bit of hubris from academia.

Grant Reeher is a poli-sci professor at the Maxwell School at Syracuse. He begins an article in the Ottawa Citizen by saying an Environics poll showed “a genuine state of crisis in U.S. health care is on the way.”

He cites four trends:

  • the predominance of managed care
  • the aging population
  • failure to control costs
  • failure to guarantee access to care.

He concludes, “These trends will lead to a political environment in the U.S. that favors a major public-sector-based reform of health care policy,” probably involving “a government-led effort to coordinate the system, control costs, and expand health care access.”

Yes, indeedy. The government has been doing such a swell job with Medicare and Medicaid that Americans are eager to entrust it to run the whole shebang.

Demonstrating how out-of-touch academics really are, Reeher adds, “There has been little creative leadership in the business sector on rethinking health care, where most of the focus has been simply on cutting. The new movement toward ‘defined contribution’ is only the latest example.”

The article includes a sidebar about a survey conducted by Reeher’s own Maxwell School, which finds 67 percent of Canadians and 63 percent of Americans think their own health care system is in crisis— hardly an endorsement of government control.

Source: The article ran on September 23, 2002. The paper’s archives are supposed to be available for 14 days, but I couldn’t find it. Try http://www.canada.com/ottawa/ottawacitizen/

Seattle Docs Dropping out of Medicare

The Seattle Times reports local physicians are less likely to accept new Medicare patients than physicians in other areas of the country. Reporter Carol Ostrom writes, “In 2001, only 54.5 percent of doctors around Seattle accepted new Medicare patients, down from 71.3 percent in 1997.”

The article is based on a survey conducted by the Center for Studying Health Systems Change (HSC) of 12,000 physicians around the country. The survey also found that fewer than 8 percent of Medicare patients in Seattle reported having trouble receiving services—half the rate of cities like Cleveland, Miami, and Phoenix. The article cites Tom Curry of the Washington State Medical Association as noting the survey was conducted before the 5.4 percent Medicare cuts in physician payments kicked in.

Source: http://seattletimes.nwsource.com/html/localnews/134530328_medicare06m.html

Medicare Spending Not What You Think

The National Center for Policy Analysis (NCPA) released a couple of Brief Analyses on Medicare spending last month. Both written by Andrew Rettenmaier and Zijun Wang of Texas A&M University, the papers reveal some counter-intuitive information about Medicare spending.

The first finds that men on Medicare actually cost more than women do, after adjusting for age. It also finds that racial disparities in Medicare spending have reversed over the past 25 years. In 1974, Medicare spent more on white males than on black males ($1,398 vs. $1,236), while in 1997 Medicare spent only $4,372 per white male and $5,452 per black male.

The second paper calls into question the assumption that much of the increase in Medicare spending is attributable to end-of-life care. The authors find that, while it is true the last two years of life are very expensive, they are not becoming more expensive relative to spending on non-terminal patients. Rettenmaier and Wang also find that terminal care for older patients (age 80 and above) is considerably less expensive than terminal care for patients at ages 65 to 69.

Source: http://www.ncpa.org/pub/ba/ba408 and http://www.ncpa.org/pub/ba/ba409

Drugs in Canada Cheaper Because Canadians Are Poorer

The Fraser Institute finds the price difference for prescription drugs between the U.S. and Canada is growing, but not for the reasons most people suppose.

An article by John Graham in the Fraser Forum finds, Canada’s Patented Medicine Prices Review Board “is not a significant cause of the ‘cheapness’ of Canadian patented drugs.

“Canadian health-related goods and services in general are almost as cheap relative to those in the United States as patented drugs are, despite the lack of explicit price controls for them.” Why should this be? Because Canadians are getting poorer compared to Americans. Graham says in 1997 the per-capita GDP for the U.S. was 46 percent greater than Canada’s, but grew to 55 percent greater in 2001. Drugs sold in Canada, like cars sold in Canada, are cheaper because Canadians can’t afford to pay more for them.

Source: http://www.fraserinstitute.ca. Search for author John Graham.

HHS: Americans Healthier than Ever

Not only are Americans getting wealthier, we are also getting healthier, according to a new report from HHS.

In 2000, Americans had the longest life expectancy in our history: 77 years for women and 74 years for men. During the last 50 years, the death rate for children and young adults was cut in half.

Infant mortality alone has dropped 75 percent since 1950. The homicide rates for black and Hispanic males dropped almost 50 percent in the 1990s. More surgeries are being done on an outpatient basis (63 percent of all surgeries in 2000 vs. 16 percent in 1980), and lengths of stays for inpatient surgeries have dropped from more than seven days in 1980 to 4.9 in 2000. Still, fitness remains a concern, as Americans become more obese and more sedentary.

Source: The HHS information is at http://www.hhs.gov/news. The report itself can be found at http://www.cdc.gov/nchs.

Mandates in Texas Raise Premiums 17 Percent

The San Antonio Business Journal attributes premium hikes in Texas in part to mandated benefits. The article cites the Texas Association of Business (TAB) as identifying five of the 63 mandates in Texas as responsible for a 17 percent increase in premiums in that state.

That is why TAB opposes the Mental Health Parity mandate under consideration in Texas. But advocates for the bill claim costs will be higher if mental illness is left untreated, especially through absenteeism, lost productivity, and physical manifestations of mental illness. The article gives an example of one local company that concedes mental health treatment is important, and offers benefits that are near-parity. But this company charges a slightly higher co-payment for mental health treatment, because it wants to continue paying 100 percent of the premium for its workers. It fears some employees would not accept the coverage if they had to pay part of the premium.

Source: http://sanantonio.bizjournals.com/sanantonio/stories/2002/09/02/focus1.html

Greg Scandlen is senior fellow in health policy at the National Center for Policy Analysis in Dallas, Texas and assistant editor for Health Care News. To sign up for his free weekly e-newsletter, Scandlen’s Health Policy Comments, log on to http://www.ncpa.org/sub. Email Scandlen at [email protected].