As everyone knows by now, Obamacare would raise, not lower, health costs. This is the consensus view of the CBO, Medicare’s chief actuary, and the American people. However, another consensus view — shared by nearly everyone outside of the Obama White House and the Democratic Congress — is that the number one goal of health policy should be to cut costs. So, if you combine a health care overhaul that won’t cut costs, with a pressing need to cut costs, where are we headed?
President Obama’s pick to fill the top post at Medicare and Medicaid provides a strong indication. We’re going down the only cost cutting road that government can travel. More exactly, we’re heading toward a nation-defining fork in the road. In one direction lies repeal; in the other, rationed care. In one direction, liberty; in the other, consolidated power.
President Obama’s pick to head the massive Centers for Medicare and Medicaid Services, Dr. Donald Berwick, is a Harvard doctor with a stated fondness for nationalized medicine. He plainly wasn’t picked for his large-scale executive or managerial experience. He’s currently a professor, a pediatrician, and the CEO of a nonprofit whose website reports it has “a staff of over 100 dedicated and talented people.” No, he was presumably picked because he and President Obama see eye-to-eye: Both share the same academic approach to problem-solving, both think our health-care system should be run through Washington, and both support a strong degree of bureaucratic control over questions of life and death. If confirmed by the Senate, he would become head of an agency with a budget larger than that of the Department of Defense.
In the private sector, costs can be cut through increased competition and choice, which will cause resources to be allocated more efficiently. But government-run health care can’t control costs except by limiting services. Last April, President Obama said, “The chronically ill and those toward the end of their lives are accounting for potentially 80 percent of the total health care bill out here.” Thus, he said, “There is going to have to be a very difficult democratic conversation that takes place.” Dr. Berwick agrees. In fact, he’s been involved in that conversation for awhile.
Berwick doesn’t advocate cutting health costs by letting Americans control their own health care dollars, see prices, and shop for value. Rather, he prefers the approach employed by Great Britain’s National Health Services (NHS) and its National Institute for Clinical Health and Excellence (NICE). NICE, whose name seems to have been inspired by George Orwell's 1984, decides which care people will get and which they won’t.
In an interview last June, Dr. Berwick said, “NICE is extremely effective and a conscientious, valuable, and — importantly — knowledge-building system.” He added that NICE has “developed very good and very disciplined, scientifically grounded, policy-connected models for the evaluation of medical treatments from which we ought to learn.”
Moments later, the interviewer asked, “So you are saying that the federal CER [Comparative Effectiveness Research] agency should get involved in cost determinations?” (The new Federal Coordinating Council for Comparative Effectiveness Research was created by last year’s “economic stimulus” package.) Berwick replied, “You can say, ‘Well, we shouldn’t even look.’ But that would be irrational. The social budget is limited.” The social budget? Can you even imagine an American Founder using that phrase?
The interviewer then stated, “Critics of CER have said that it will lead to the rationing of health care.” Berwick replied, “The decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open.”
NICE certainly rations with its eyes open. On its website, it explains that “choices have to be made.” Thus, “It makes sense to focus on treatments that improve the quality and/or length of someone’s life and, at the same time, are an effective use of NHS resources.” NICE elaborates:
To ensure our judgements are fair, we use a standard and internationally recognised method to compare different drugs and measure their clinical effectiveness: the quality-adjusted life years measurement (the ‘QALY’)….
A QALY gives an idea of how many extra months or years of life of a reasonable quality a person might gain as a result of treatment (particularly important when considering treatments for chronic conditions).
A number of factors are considered when measuring someone’s quality of life, in terms of their health. They include, for example, the level of pain the person is in, their mobility and their general mood.
In other words, if you want treatment, don’t show signs of pain, immobility, or moodiness. The description proceeds thus:
Having used the QALY measurement to compare how much someone’s life can be extended and improved, we then consider cost effectiveness — that is, how much the drug or treatment costs per QALY….
Cost effectiveness is expressed as ‘£ per QALY.'
Am I the only one who feels a chill?
The Wall Street Journal aptly summarizes the problem: “While the guidelines are complex, NICE currently holds that, except in unusual cases, Britain cannot afford to spend more than about $22,000 to extend a life by six months.” The Journal adds, “The last six months of life are a particularly difficult moral issue because that is when most health-care spending occurs. But who would you rather have making decisions about whether a treatment is worth the price — the combination of you, your doctor and a private insurer, or a government board that cuts everyone off at $22,000?”
Berwick favors the government board. In a piece published in 2004, he writes, “Both the UK and the US are struggling to improve their troubled healthcare systems. Which is more likely to succeed? The two countries are strikingly similar in the problems they face, and equally dissimilar in their plans of action. I am a fan of both but, when bets are placed, my money will be on the UK.”
In a publication from 2000, he and his co-author write that “we share an optimism about the NHS that is hard to find in the UK nowadays.” In a plainspoken passage, they add, “We think nationalized health care was a wise choice in 1948 and that it remains so now.”
Thus, President Obama has nominated a man to run Medicare who’s an outspoken advocate of nationalized health care, of NICE, and of U.K.-style cost cutting. This likely won’t provide much comfort to seniors, who are already alarmed that nearly half of Obamacare would be paid for through cuts to Medicare. No wonder seniors favor repeal of Obamacare by an even greater tally than the 56-to-40 margin among Americans as a whole (the average across a month’s worth of Rasmussen polls).
Berwick also likes to talk about “patient-centered health care.” But this shouldn’t be confused with putting patients in control of their own health care dollars. Rather, it involves making sure that government-controlled health care is, well, nice, to patients. Here is Berwick’s published definition of “patient-centered care”: “The experience (to the extent the informed, individual patient desires it) of transparency, individualization, recognition, respect, dignity, and choice in all matters, without exception, related to one’s person, circumstances, and relationships in health care.” It doesn’t quite resonate like, “Let patients control their own health care dollars, pick their own doctor, and make their own health care decisions,” does it?
Instead, under Berwick’s notion of patient-centeredness, hospitals would no longer limit who could visit patients, what food patients could eat, or what clothes they could wear; patients and families “would participate in the design of health care processes and services”; and patients and family members “would participate in rounds.” So, you could wear whatever you want, eat whatever you want, and apparently follow doctors around on rounds. You just wouldn’t get the drugs or treatments needed to keep you alive.
In a London paper, Dr. Sarah Anderson, an NHS ophthalmologist, writes of her dad’s battle with the NHS amidst his battle with cancer: “I never for a moment thought that a life could be decided by something as arbitrary.” She elaborates, “Yet that is what has happened to my father. And it is only now, sitting on the side of the patient, that I have seen the injustice inherent in our system and the devastation it can cause.”
NICE refused to fund the drug her father needed. Her family responded by trying to pay for it out of pocket, but, she writes, “the NHS told us that if we pay for the drug the NHS will not pay for any of his care. All blood tests, scans and doctors’ visits will have to be paid for as well. The NHS will wash its hands of him.” Dr. Anderson concludes, “If Dad should lose his life to cancer, it would be devastating[,] but to lose his life to bureaucracy would be far, far worse.”
In marked contrast, Berwick — who writes that “we know dependence on market forces for constructive change is playing with fire” — gushes that the British “NHS is not just a national treasure; it is a global treasure.”
Now President Obama and Dr. Berwick want to open that “global treasure,” or similar riches, on this side of the pond. There are really only two reasonable explanations for this: one, an ideological zeal for centralized planning; two, a personal desire to be in control of that planning. We hear a lot about the dangers of the “profit motive.” This is the far more dangerous “power motive.”
Tocqueville warned of this motive, sagely writing, “One can easily foresee that almost all the ambitious and capable citizens that a democratic country contains will work without respite to extend the prerogatives of the social power, because they all hope to direct it one day. It is a waste of one’s time to want to prove to them that extreme centralization can be harmful to the state, since they centralize for themselves.”
Thankfully, the real power in America still lies with the people — as it always has. And five simple and salutary words can free us from Obama’s and Berwick’s destructive designs: Repeal, and then real reform.