HEALTH REFORM: This Time It’s All or Nothing

By Deb Richter

Jan. 31, 2011

It has been several weeks since the Harvard health economist, William Hsiao, and his working group, issued their 120-some page report.  Praise has been heaped on it, describing it as historic, ground breaking, and masterful, words I entirely agree with.

I’ve studied it and thought about it. I’d like to offer this perspective.

The report is called “Act 128 Health System Reform Design: Achieving Affordable Universal Health Care in Vermont” but will forever be known as the Hsiao Report.

It does exactly what is was asked by the Legislature. It outlines the designs of three health care systems and offers the rationale behind the thinking for each, including facts, figures and the probable economic consequences. For Vermont, this is ground breaking.

Two of the three look good. One of them (the public option) is hardly in the running because effectively it leaves the problems – focused largely on unsustainable costs – untouched.

The favored system designs have numbers. Option 1 is a single-payer system. Option 3 is a single-payer system. What is the difference? Not a lot. Operationally there are differences. But at this stage, far more important is what they share. It is something of  overriding importance that we overlook at our peril, and in fact have overlooked at our peril for years. That peril can be described as an unsustainable rise in costs.

Here is the Hsiao Report: “Vermont will need to reorganize existing systems and develop new administrative capacities to manage an integrated, single-payer health system. In addition, the state will need to institute a regulatory apparatus to oversee the functioning of the system.”

This admonition appears about nine-tenths of the way through the report, but it is the key to everything. Our Legislature and new Administration are called on to create an integrated health care system. System is not an idle idea. Without a system the costs of health care in our state cannot be managed, contained, controlled, budgeted and will remain unmanaged, uncontained, uncontrolled, unbudgeted

The Hsiao Report is a masterful piece of work. It is specific to Vermont, to our health care, to our economy, to our political landscape, and to Vermont’s intersection with federal laws, regulations and, by implication, politics. Vermont has never before had anything close to this to work with. It maps out routes to a goal which can be abbreviated as “high-quality health care for all Vermonters,” and by affordable is meant affordable to individuals as well as Vermont as a whole.

Comments no doubt are pouring in. Because they are by post or email we can’t know what they are. There will be reservations, objections, gloomy prognostications, alternative theories, quarrels over details, moans from idealists, self-interested criticisms from the what-about-me crowd, some of it valuable, some of it a deplorable waste of time, but all more or less beside the main point.

As the Hsiao Report implies in its gentle way, if we don’t move to an integrated health care system that is uniform and regulated we are done. The costs are going to bury us. That is the essential main point.

A system oversees and coordinates. It integrates. At some basic level it abolishes the what-about-me chorus in favor of what-about-all-of-us. A system takes the fundamentally necessary step of grounding health care, and all of its elements, solidly in the realm of the public interest.

One of the great things about a system it is best to remember is that it provides a framework within which to adjust, adapt, change, confront new circumstances, deal with new problems, to fill in gaps, in other words to self-correct. To handle details in a systematic way you need a system. This is the opportunity the Legislature and the new Administration have been handed.

So the public comment period is drawing to a close (Feb. 4). The usual practice in committees and hearings – the standard back and forth of legislation – is to pick away at the details (”the devil is in the details”). Not this time. This time the devil will reside in our failure to create and establish a true health care system.

3 Responses to “HEALTH REFORM: This Time It’s All or Nothing”

  1. Ardis says:

    Perfect info! I have been previously searching for something like this for quite a while now. Appreciate it!

  2. Nicholas Burton says:

    Great article!

    As a immigrant from the UK, I find healthcare in the USA complicated, burdensome and riddled with anomalies.

    However European systems are not perfect either, and I would ring a cautionary note about those. The British system specifically has in the last 20 years suffered from an inflated highly paid middle and upper management structure (bureaucracy). This has tended to divert significant funding from the lower tiers where medicine is actually practiced, and as a consequence driven more ideology than good medicine.

    Perhaps the most cost-effective driver is in the pharma market allowing the UK as a single entity to negotiate drug and equipment prices.

    However, I wish Vermont well in its endeavor, and look forward to seeing its success adopted by other states.

  3. hd vector says:

    Thanks a lot, just what i needed.

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