Health Care Policy

Washington Post business columnist Steven Pearlstein was online to discuss today's column on President Bush's health care proposals, health savings accounts and consumer-driven health care.

A transcript follows.

About Pearlstein: Steven Pearlstein writes about business and the economy for The Washington Post. His journalism career includes editing roles at The Post and Inc. magazine. He was founding publisher and editor of The Boston Observer, a monthly journal of liberal opinion. He got his start in journalism reporting for two New Hampshire newspapers -- the Concord Monitor and the Foster's Daily Democrat. Pearlstein has also worked as a television news reporter and a congressional staffer.

His column archive is online here .

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washingtonpost.com: Read Today's Column: A Better Way to Spread the Health -- and the Wealth

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Manassas, VA: We have Health Savings accounts where I work. You have to estimate what you think your expenses would be. Guess right and you have money to use. If you have left over money after the year is over, you lose it! Guess wrong and you may not have enough money.

Geez, I've had 3 family members with cancer diagnosis that wasn't expected. How do you estimate surgical costs and Chemo Therapy and radiation. How do you plan for Car accidents which occurred to one family member after being diagnosed with cancer? There's no way!!

How can you base an entire policy on estimates?!!

Steven Pearlstein: Good morning all. I'm afraid we have so many tax-favored accounts going around now that its very easy to confuse them. The account you mention, allowing you to set aside an amount every year in pre-tax dollars to cover out of pocket expenses, is different than the Health Savings Accounts proposed by the president, although similar in concept. The President's version doesnt require guessing: you put aside what you want to put aside, and if you don't use it, it would roll over indefinitely.

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Washington, D.C.: I'm hoping you can clarify a key point during your discusion. Nearly every newspaper article I've seen recently reports that there are now 3 million HSAs (this is based on a recent survey of health plans conducted by AHIP and has been cited by the White House). This is misleading. AHIP's study found that 3 million lives were covered by a high-deductible health plan (HDHP) that is COMPATABLE with an HSA. HSAs must be opened by a bank or other qualified trustee. Based on some early data we're compiling, it looks like about 1 million HSAs (the actual accounts) have been established as of Jan. 1.

Steve Davis

Managing Editor

Inside Consumer-Directed Care

Steven Pearlstein: Thanks for that clarification.

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Rockville, MD: How about this:

1. Force people to buy health insurance (with everyone buying insurance, premiums will go down).

2. Allow people to buy insurance through the Government (this will cause premiums to fall even lower)

3. For people unable to afford the premiums the Government will institute a DEDICATED progressive income tax to pay for it.

N.Bahn

Steven Pearlstein: Not a bad plan. The mandate would be controversial, and if we have to establish a new tax, the politics would be very uphill. Better to take current income tax, cancel some portions of the Bush tax cut, and use the proceeds for tax credits to people who spend more than 10 percent of household income on health insurance and out of pocket.

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Ole City Doctor: I really question the whole idea that persons are going to be informed consumers and that they will be competent to decide when healthcare is needed when financial considerations are in the mix. People who do not have insurance already present late in their illness, and are more expensive to treat. Let's face it: Mr. Bush doesn't want to help more people to have access to healthcare--he just wants to remove the "burden" of employer sponsored insurance from corporations so that they can increase their bottom line.

Steven Pearlstein: I think you're probably wrong on all counts. Medical professionals tend to think they know best, and discount input from patients, which I suppose is only natural, after you go through all that training and have all that experience. But the evidence is that medical professionals, in fact, follow the wrong protocol, or engage in care that does not have good cost-benefit, alot. And there's also evidence that well-informed patients can help cut down on all that. As for Bush, let's question his policies, not his motives. I'm sure he wants to help companies better control what has become an uncontrollable item in their cost structure, health insurance. That's perfectly reasonable. But I think it is not correct so say he doesn't care about the uninsured -- its just that any fix to that violates his ideologically driven positions or would force him to give up on other priorities, like fighting a war and tax cuts.

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Princeton, NJ: Steve, I have written to you before about single payer systems, but you have not seen fit to offer a rational reply. Here again are some points.

1.Please stop calling single payer systems socialized medicine-some are and some, like Medicare, are not.

2.It is clearly not true that a single payer system is somehow un-American. Medicare is one of the most popular programs in the history of our country.

3.This belief that patients are competent to pick their medical care is nonsense, Rand notwithstanding. I am a mathematician and have a good working knowledge of probability and statistics. My primary physician once taught statistics at Cornell Medical School. BUT we simply to not have the time to go through the statistics to see if each test, each treatment, each drug is cost efficient. We have to rely on his 40 years of experience. Many years ago he began giving me extensive blood test that could not possibly have been cost effective. Although I had no symptoms, we discovered I had Hairy Cell Leukemia, a very rare condition. How would I have known to approve tests for it? Of course, maybe it is more cost effective if I were dead.

4.Here again are the basic facts about our system versus single payer systems: If you look at the 13 developed countries and rank them according to the 16 basic public health statistics, the US ranks 12th or 13th in each one. Yet, yet we spend 2.5 TIMES as much as the average of these countries. Other countries get much better health care at much lower cost. All of the other countries have single payer systems.

5.Let's fight for Medicare for all. We can do it.

Steven Pearlstein: Its not true that I haven't responded to people who suggest a national health plan. I just don't think it is politically feasible, although support is growing, particularly among doctors, which I find interesting. But I also know that the countries that have it are also facing their own crises, and are much slower to adopt new medical technology, which apparently is a tradeoff you are willing to make. Maybe some of us aren't.

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Rockville, MD: What do think about the growing movement in health care to pay doctors and hospitals more when they achieve higher quality and safety performance standards? Can "pay-for-performance" be a way to help control cost increases?

Steven Pearlstein: Yes, that's part of anyone's health reform plan, including President Bush.

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Houston, TX: Let's put the waste and expense generated by insurance companies aside for a moment. Those who promote HSA's seem to hold doctors as saints who require no scrutiny and that consumers are the ones largely responsible in driving up costs by demanding procedures and drugs that are "medically unnecessary." How will HSA's reign in those who are ordering the procedures and prescribing the drugs? How will consumers make informed choices about what they should spend money on? Most people trust their doctors' orders--if we are to become our own health consultants we should all go to medical school. I live in one of the largest health care centers in the world, and it is clearly evident that a lot doctors make a lot of money on health care consumers. A universal system seems to me the only way to accomplish a more responsible, cost-effective, and equitable system.

Steven Pearlstein: Again, I have more faith in American consumers than you do.The idea is to change the way things work now, which is unsustainable. And one of those things is the idea that we leave all medical decisions to doctors and other health professionals. Docs need lots of input from decision support systems that let them know about the most cost-effective protocols, which are working quite well at places like Mass General Hospital. And as with any other provider of any other service, they'll do better at their jobs if more people (not all people but more people) are better informed consumers. Of course, they may make less money that way.

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Baltimore MD: Off topic comment re customer service: After reading your column about trying to get satellite tv installed, I had to pass something on. I recently had a problem with Verizon DSL and a repair order was lost, I was told that even if they gave me a repair day (with an 8 hour window!) that was no guarantee the guy would show up. ("Other calls may take longer and he may not be able to get to you") etc. Then it turned out the problem was with the modem. An absolutely superb customer rep whose name I can't recall now (but I wrote praising him to the company) guided me through a long, involved process getting on the modem manufacturer's site, configuring new modem settings and getting me up and running. My point is, customer service is now a total crapshoot. You can get someone who doesn't give a damn, or you can get the highly skilled and patient guy I wound up with. I wonder if they get the same compensation?

washingtonpost.com: Service Call (February 3, 2006)

Steven Pearlstein: Thanks for that update.

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Arlington, Va: You state in your article that a good way to reign in the cost of health care would be to have patients become responsible for a fraction of all health care costs. Doesn't something also have to be done on the other side of the coin to reign in the ever increasing costs of doctor's visits and procedures.

Steven Pearlstein: If customer start to push back and shop around, that is precisely the kind of downward pressure on prices that will occur.

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Annandale, VA: Isn't any discussion of health care reform in this country an exercise in futility? The health insurance industry pretty much dictates US health care policy especially now the Republicans are in power. The primary concern of the health insurance industry is making money NOT providing health care to people. We can go over and over how the US is the only industrialized country that doesn't provide access to quality health care for all its citizens but what's the point? The American people have been misled into believing that investors on Wall St. and "free markets" will cure all that's wrong with the US health care system (remember the health insurance $100 million "Harry and Louise" TV misinformation campaign?)

According to Uwe Reinhardt, a respected authority in the health care field, we have essentially a three tiered system in the U.S. The wealthy have unrestricted access to the best health care this country to offer. The middle class has restricted access to health care through managed care plans typically offered through employers. The people at the low end of the income ladder (usually the unemployed or "working poor") experience the most brutal form of rationing and are pretty much left to fend for themselves. Such is the track record of our profit driven "free market" approach to health care. Haven't we in the US tacitly agreed to the proposition that health care is a privilege based on one's ability to pay?

Thank you.

Steven Pearlstein: Uwe's description is spot on,as always. But you overstate the case about the consensus that health care is a right, not a privilege. The government now pays for half of the health care consumed in this country. We have a moral and legal commitment to the very poor through Medicaid, including a program for poor kids that has been a big success. And we have a very fine Medicare system. So its a mixed picture, nowhere near as bleak as you suggest.

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Wichita, KS: You state:

"We know from John Wennberg and his associates at Dartmouth College that as much as half of all health care consumed in some regions is medically unnecessary."

Where is managed care in the above referenced regions? It seems unbelievable to me that such a thing could be happening.

Also, we have been told by some media outlets, that the Bush plan will actually increase the cost of medical care. I did not see where you addressed that concern in your article. Is it a real concern?

Is health care something that can really be effected by market dynamics? I go to my doctor, I do what she says. I don't see it as something that can be effected by traditional market-place pressures. I doubt that I would want to wait for a sale on any angioplasty I might need.

Finally, one last question. What do you think of consumer owned non-profit corporations, like Group Health in Seattle? Could such corporations be viable for addressing health care coverage?

Thanks for your work on this important subject.

Steven Pearlstein: I think we've addressed some of your points about consumer participation. You raise an interesting point about managed care. As I've written before, I think managed care has to be part of any solution. But the insurers have to avoid the mistakes of the last round of managed care, using more carrots than sticks and simply supplying docs the information they need tomake better decisions. The experiments at Mass. General and elsewhere suggest they will respond to better information.

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washingtonpost.com: An archive of Steven's past columns is online here .

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Pittsburgh, Pa.: Your column is correct, but how do you the unions like the UAW who do not want people to pay anything, to go along? Or not to try and sink anything but that?

Steven Pearlstein: Great point. The UAW attitude just has to be broken -- its as simple as that. Paying nothing is no longer an affordable option for anyone. It is eating badly into the wages of UAW members, who each round of bargaining trade off raises to preserve their health benefits. And in the end, all they buy is health care inflation. This isn't about sticking it to union members, although they are quick to suggest that. Its about getting them more value for themselves as compensation for the value they create at work. The trick here is to show them that their company is NOT paying for their health insurance, as they now think. THEY themselves are paying for it in lower wages.

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Northfield, MN: Your proposal in response to the president's is interesting, but still falls short.

How would you improve the utilization of preventive services, which have been shown to have ROI's of $3 to $7 for every $1 invested? Studies have shown that people are more likely to use these cost saving services when they are covered by insurance.

Consumers do not purchase health care, especially treatment, the way they do a car or other good, even when they have to pay the full cost. People generally will pay for the best care available to them, whatever the cost. If they can't pay, they become charity cases and the cost gets shifted to everyone else.

Unfortunately, a percentage co-pay becomes regressive. Providers looking to maximise income will target their high end, high quality services to those you can afford them. Thus, low income folks still get the short end on access to quality services. It might work if the out-of-pocket maximum is set by income level.

Steven Pearlstein: Well, you make some good points, although I don't find them dispositive. No system is going to be perfect, and eliminate all perverse incentives. The trick is to minimize them.

Preventive services are important, which is why I would make it clear that all catastrophic policies have coverage of basic preventive services (annual checkups and as indicated for each age groups, other stuff for people with chronic conditions).

And yes, while health care is not consumed like other goods (I wrote that column, too), its not totally dissimilar from other goods and services either. And there are some market mechanisms that can be harnassed to help get good value. That's my view, anyway.

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Charlotte, NC: It should be a requirement that every person should have at least catastrophic insurance, with gov't possibly picking up the tab. The marketplace rules and competition can also be used to reduce the health care costs. The largest insurance companies have already the information about what a certain medical procedure did cost at a certain medical provider. They should use the data to make comparisons between procedures and/or medical providers, using cost-benefit rules.

Combining this information with the outcome of the procedure and with outside expert medical opinion one could be able to rate that doctor/medical provider in terms of cost and effectiveness. The final result may be that the insurance company would submit request of bids from different medical providers and then a mixed commission formed by a doctor and a representative of the insurance company may decide which medical provider to choose

Steven Pearlstein: Good points all. Thanks.

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Vienna, VA: I think one of the big problems we have in healthcare is pricing. The people with the least ability to pay -- poor, without health insurance -- are charged the most. Those with health insurance not only pay the least out of pocket, their insurance companies pay less per item than someone without insurance would pay. Take a procedure I had last month: the "full cost" was $324. My insurance company paid $75 (these are the real numbers). My co-pay: $10.

If $75 is the price my insurance company has negotiated with the facility for that procedure, one has to make the assumption that $75 covers their costs and leaves them with profit -- because if the price was below their cost and required profit line, they would not have made the deal. So why is the cost not $75 to everyone?

Steven Pearlstein: This is a very important point, and one that I included in my columnt oday before it was taken out for space reasons.

Michael Porter of Harvard Business School, and Elizabeth Teisberg of the University of Virginia, are about to come out with a book that lays out another health reform model. And the most important suggestion they make is that doctors or hospitals or labs should be allowed to compete against each other in what they charge, but that they must charge all customers, from the lowliest individual to the biggest health insurer, the same price for whatever services they offer. In the lingo of business, no price discrimination. This, they argue, will get competition in the health care industry away from where it is now (competing to shift costs onto other payers) to where it belongs (competion among providers to provide the best value). This is VERY important, and needs to be part of any reform. It is an important insight.

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Princeton, NJ: It's clear why other countries are having some trouble. It's because they don't spend enough. They spend less than half per person than we do. In spite of this, they get much better health care. Face the facts.

Steven Pearlstein: Face the facts: the American political system won't go for a government run system, at least not in one step.

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Hanover, NH: Doesn't the whole discussion of HSAs ignore the fact that about 50% of spending is on people with severe chronic illnesses? Deductibles wouldn't begin to control spending in areas, like Miami, where much of what is being provided is excessive and ineffective. Nickel-and-diming preventive/primary care seems irrational when we do nothing to rein in spending on futile and often unwanted interventions in the last months of life.Megan McAndrew

Steven Pearlstein: I reject the idea that spending on people with severe chronic illnesses is off-limits when it comes to reducing the cost of treatment. In fact, it is the most fertile area for a whole host of reforms, from disease management and pay for performance to more patient involvement in decision making (including price). And nobody -- let me repeat, NOBODY -- is suggesting scrimping on preventive care, including President Bush and his team. But at the same time, I completely reject the position of the medical establishment, and some advocates for the poor, that if you require patients to put even a dime into the cost of their own preventive care, people will cheap out and not do it. Some will, and that's something we should try to minimize. But keeping first-dollar coverage for all services to avoid that "bad" is very, very inefficient and leads to all sort of other "bads" that are much worse.

What you have to remember in designing a health care plan is that there is no ideal. There are always tradeoffs. People may make different tradeoffs, but to reject a good idea for most of 300 million Americans, like getting informed consumers into the mix of decision making, because 10 million people aren't smart enough to know their own self interest is crazy. And its the kind of argument that gets too much attention here in Washington, frankly. Let's not let the perfect be the enemy of the good.

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Rockville, MD: I forgot to mention that the Government must be allowed to directly negotiate with drug manufacturers.

N.Bahn

Steven Pearlstein: I'd like to see more of that, although at some point it devolves into goverment price setting, which would have an impact on drug development. On that front, I think we have to start by getting other industrialized and middle income countries to begin paying their fair share of drug company research costs. That's the think to concentrate on, in my opinion.

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New York, NY: Re: Response to Rockville. Tax credits are a great idea if you're not living paycheck to paycheck. Many people, particularly single women in the high-priced real estate environments of the coasts, just don't have extra money. What's likely to happen in that case is that the person purchases the insurance and covers it or something else with credit, not because they're profligate, but because they can't cover basic needs with their $30,000 or $40,000 a year salaries, so by the time the tax credit comes back to them, it's eaten up by interest payments. When you don't have the cash up front, tax credits don't help.

Steven Pearlstein: Which is why even the Bush administration is thinking about figuring a way to front load the tax credits. Good point.

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Ocala, FL: Everyone seems to make healthcare so complicated, however it will never be fixed until we stop spending so much money keeping people alive that are clearly getting ready to die. What percentage of our healthcare costs is spent keeping older dying people alive? Why don't we just send people home to die instead of keeping them alive on expensive machines and drugs that are doing nothing more than prolonging the inevitable?

Steven Pearlstein: It is true that we spend a lot of money on people in the days, weeks and months before their deaths. But the problem with putting too much emphasis on this is that in many cases, it is not clear they will die -- many of these cases look just like cases in which people get better. So in hindsight, it looks easy to say, don't spend all that money on end of life care, but in real life, its more complicated. That said, there is too much medical heroics with low probability of success for certain groups of patients, and having good protocols and evidence-based medicine will help to reduce that.

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Denver CO: Now having a recent addition to my Family making it a Family of Four, I've accepted a new Job that Pays 100% of HealthCare (Unheard). It pays less but yet in my previous job it would have cast me about $1,100 a month to insure the family. I consider myself lucky but I fear that I'll never get a raise due to the yearly cost increases of insurance. In my previous position the health insurance provided actually had sent a letter stating that they were pleased to announce that insurance cost will only go up by 10% as opposed to the national average of 15%.

Steven Pearlstein: Indeed, you ARE paying for your gold plated health plan through lower salary.

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Buffalo, NY: I recently read an op-ed that said the Veterans Health Care system would make a great model for a national health care system. Is seems pretty convincing. What is wrong with that belief?

Steven Pearlstein: Nothing. They're doing great things in terms of health care information technology and evidence-based medicine. They also specialize in a certain group of the population, with which they have lots of experience. But I don't think their success argues for having all Americans get their treatment from VA hospitals. There have been times in the past where VA health care was very poor, and there could be times in the future in which that is true, particularly if it were to become the only system, as some advocates of national health care suggest.

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Tysons Corner, VA: The high-deductible model doesn't seem to work at all for folks with chronic illness. There is nothing my wife could have done to avoid getting juvenile diabetes, but now she has huge annual medical expenses. So, while I would pay much, much less for medical care than I currently do under a HSA-type arrangement, she would pay much, much more. Moreover, part of the reason her annual expenses are high is that she aggressively treats her disease, hopefully avoiding the real long-term costs like kidney failure and transplant, or limb amputation. How does this type of illness fit into your proposed system?

Steven Pearlstein: It fits in through the tax credits for all health expenditures, including premiums, in excess of 10 percent of household income.

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Chicago: Why does new technology in healthcare drive up costs? This is a unique phenomenon--in every other industry - telecom., computers, cellphones, automobiles - as technology improves, costs decline. In healthcare, on the other hand, better CTs, faster MRIs and things of that variety invariably drive up costs. Is the lack of transparency of costs? Is it the over-utilization of new technologies? Unless these issues are addressed, I don't see how the issue of expensive healthcare can be resolved. I truly believe we are neither a truly market-driven nor a full single-payer system and therefore are stuck with the vagaries, inefficiencies and problems associated with both. Thoughts?

Steven Pearlstein: When people say new technology, they mean new and better ways to treat illnesses. A new drug. A new testing machine. New operations. These do a lot to improve the lives of Americans, and are often well worth the price. But they essentially expand the number of attractive products on the shelf, meaning we buy more.

Now some technology does save money -- a drug that replaces an operation or avoids a hospital stay.

On the other hand, we've done a miserable job in applying information technology to health care, where there are huge savings, particularly in a private system like ours where there are more administrative burdens.

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Vienna, VA: I grew up in an era when doctors made house calls and the local hospital was non-profit. Since then, healthcare has become a complex profit-driven industry. The AMA annually limits how many students can enter into medical schools (to keep the value of doctors high). For-profit companies purchase hospitals and create profit centers.

Health insurance companies now manage access and set performance metrics for doctors. Every level in the industry adds a mark-up. Medicare and medicaid reimburse physicians based upon diagnostic codes and companies have been created that sell models to hospitals so they can maximize reimbursements. The result is a obvious mess.

Steven Pearlstein: Actually, DRG's have been one of the big success stories in health care. And just as hospitals can hire consultants to help them game the system, so can Medicare hire consultants to help them tweek the rules to avoid abusive gaming of the system. It's a dynamic process, but hardly hopeless.

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Washington, DC: As an economist, I see red when I read about politicos telling everyone to place their faith in the "free market". These people are practicing economics without a license. Or even a firm grasp of Microeconomics 101. Or possibly, they just think the rest of us are really stupid.

There IS no "free market", at least not outside of the Chicago commodities exchange. Healthcare is an industry in which a few people know a lot, most people know very little, and a few main players set the prices and have the clout to deny what can be (literally!) life-or-death access unless their prices are paid. And unless you're poor enough AND sick enough so that they have to treat you in the emergency room, there is often no consideration given to not charging you the full price, which is whatever they say it is, whether it would be considered fair pricing or not.

I'm NOT saying healthcare organizations should not make a profit; I believe they should make a profit. But I also think we're starting at the wrong end of the problem.

Steven Pearlstein: I think we've dealt with all these issues already. You won't ever see me writing about the "free market" in health care -- as I say, I wrote that column about two months ago listing many of the ways in which the health care market works imperfectly. But markets can be managed to get some of the benefits of competition, which is where most health policy reformers come out these days. As for discriminatory pricing, you're right.

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Washington, DC: The most important issue to address is not an economic one, but a moral one. Namely, should those who are sick/injured pay a financial penalty for being sick/injured? After all, consumption of health care (other than cosmetic surgery in some cases) is not something one chooses, but something one is forced to do in response to circumstances beyond one's control (genetics, infection, accident, etc.). One could argue that consumption of food, shelter, etc. is also forced on us by our environments, but health care is very different, because needs in regards to the former two are more or less equal for everyone (caloric intake, minimum temperature in winter). Therefore, a minimum wage or welfare (theoretically) insures food and shelter for everyone. However, even a salary at 10 times minimum wage could not insure one adequately from possible health care costs. So, in sum, a society must answer whether it is morally right (quite apart from expediency) that those needing health care, particularly those with catastrophic or chronic illness or long-term injuries should be poorer as well. I would submit that all moral teaching informs us that they should not be, and that the healthy, in a progressive way, should, in effect, subsidize the sick by sharing the health care cost burden equally throughout society. In any case, this precedes questions as to whether to try to make America's imperfect market work better, or to accept that markets cannot work in health care and focus more on government regulation. The market or regulations are but means without independent ethical justification; one must figure out one's desired end first.

Steven Pearlstein: Its hard to disagree with you other than to point out that the current system of health insurance is built on the very moral premise you propose. What is insurance, after all, but the transfer of money from those who happened not to be sick in a given year to those who were. So its not true that we live in a society in which we say everyone for himself when it comes to health care. Insurance is a collective action mechanism for dealing with this problem, and is highly redistributive. But you do get into problems where you insure too much, which has distortive effects on pricing and how much health care people consume. So we need to balance the need for insurance (i.e. the need to have healthy people pay for the health care of sick people) with the need to keep the system more cost conscious. That's the struggle in which we are now engaged, to borrow Lincoln's phrasing.

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Laurel, Md: How do we tackle the problem that sick people can consume unlimited amounts of money? I have a few older friends that have each amassed bills of over $500,000 in the last several years. Spending that money on a 72 year old person who's lived a full life instead of using it to provide care for 500 - 1000 children is immoral and stupid. But old people vote - kids can't. Any ideas on how we fix this?

Steven Pearlstein: We fix it by coming up with evidence-based medical protocols that advice doctors and patients when to stop. In some cases, we may need to set things up whereby if people want to ignore the protocols and continue care, they can pay for it themselves rather than asking everyone else to pay for it through higher premiums and taxes.

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Highland Park, NJ: Hi Steve,

I'm confused as to this notion of "consumer-driven" health care. HC costs are up so Bush's suggestion is to push more of the costs onto the consumer so they'll have a consumer incentive to spend less, i.e. shop around for doctors or re-consider taking their child to the doctor for preventive care? Am I understanding this correctly? And is it also true that money put into a HSA cannot be used to pay the premium, only the hc expenses up to the high deductible? Forgive me for my lack of enthusiasm if this is accurate. Pre-tax or not, this sounds like a bum deal for people who previously got decent health benefits through their employer. The single-payer option sounds better and better to me, and I'm about the farthest thing from a liberal you can find.

Thanks for being here today.

Steven Pearlstein: Alas, I'm afraid you may be a bit confused. Yes, you would be able, under the Bush plan, to purchase your catastrlphic insurance with pre-tax dollars, as well as out-of-pocket expenses. And depending on whether you get sick in a given year or not, you either come out better financially than your current health insurance plan or worse. But let me quarrel with the way you phrased your question, when you talk about "push more of the costs onto consumers." Who do you think is paying the costs now? YOU are, all of you, in taxes, in foregone wages and in the price of the goods and services you buy. If you think its the shareholders of big bad corporations that are now paying for your health policy, you need to think again.

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Laurel, MD: I'm one of those people with a chronic condition. Since I was born with Sickle Cell Anemia, my medical costs aren't discretionary. Can you give me one reason why I should even consider a HSA instead of the traditional policy that I receive from my employer?

Steven Pearlstein: You shouldn't. Even Mr. Bush acknowledges that. The problem is that if all healthy people follow their self interest and go to catastrlphic insurance, and all chrnoically ill people remain with traditional plans, your premiums will go up tenfold, and you get a bad insurance spiral in which the market collapses. That's the reason why you need to have government very involved in structuring the insurance market, so the risk pools are as big and wide as possible and you can get the healthy subsidizing the sick.

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Philadelphia, PA: My fear is that the solution, because of ideology and politics, will be a partial one that leaves some out in the cold. Not the poor, who have gov't assistance, but the chronically ill, for whom the current system favors treating the effects of the disease (amputation for diabetics) rather than prevention (insulin pump, testing blood sugar constantly through the day). A bottle of insulin, over the counter, is $78. A vial of test strips, which last a couple of days when used completely, about the same. No one but the rich could afford to take on this burden by themselves, but I fear that's where we're headed.

Steven Pearlstein: I hope you're wrong.

Our time is up, folks. Thanks. See you next week.

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