Washington Post Columnist
Wednesday, September 9, 2009 11:00 AM
Washington Post business columnist Steven Pearlstein was online Wednesday, September 9 at 11 a.m. ET to discuss health-care reform and President Obama's address to Congress Wednesday night.
Read today's column: Time For Obama to Stand Tall.
A transcript follows.
The Commonwealth of Virginia: Fine me $3800 if I don't buy health insurance? Please explain to me the logic of that.
Steven Pearlstein: I think I just did.
Richmond, Va.: Thanks for your work and taking our questions.
Please tell me the WHY as to the proposal requiring everyone to have health insurance. I am 24, very healthy and would prefer to spend the money in other areas for now. In other words, why force me to pay for something I don't want?
Steven Pearlstein: Folks, I'm having computer troubles this morning. Every time I type an answer, it gets lost. I'll keep trying but please be patient.
Fairfax, Va.: Why is it so many people believe illegal immigrants will receive coverage through the health-care reforms? I mean, why do seemingly so many people think illegal immigrants have the sort of political clout to get such benefits included in a bill?
Steven Pearlstein: Why do you say that? Where did you get that rubbish? Its just a lie, and you should go back to the place you got it and ask them why they are lying to you and trying to scare up an issue that simply doesn't exist. In fact, the bills make it clear that legal residency is required for participation in plans sold through the new exchanges.
NOVA: First, I am not a crowd disrupter at the health care town halls. I think those people really stage their protests because Limbaugh or Beck told them too. However, I have some questions about what is being proposed in Congress. Few people would feel the Post Office, the IRS, the Pentagon, Medicare, etc. are well run government organizations. How can we feel secure in the government running health care?
Steven Pearlstein: Okay, I tried to answer this once already. let me try again.
Your smear on government is unfounded, as is your fear that the government is going to run health care.
Under the plans, doctors will continue to be private, as will hospitals, insurers, labs, drug companies -- the whole shebang. This will continue to be the most private, market based health system in the advanced world. Period. All that is being proposed is more government regulation of the insurance market, more government subsidies for lower income people to buy insurance, and a mandate that every person buy insurance (and, maybe, that every employer provide it -- that's still at issue).
Moreover, who says government can't run anything? Those town meetings were full of old people who had been scared by right wing goons into believing that somebody was going to take away their Medicare. Obviously, they think its a pretty good program if they were demanding that nobody touch it. And I think if you ran on the platform that our boys and girls in Afghanistan were doing a lousy job, you probably wouldn't get many votes. As for the Post Office, if you think everyone hates it and nobody values its services, then why is there a public hue and cry whenever it is proposed to close one office or do away with Saturday delivery? Maybe you ought to rethink this knee-jerk, ideological view that government is always bad.
Steven Pearlstein: An earlier question from a young person asked why he should be forced to buy insurance if he has other priorities for his money. It was a good question, as was my answer, before it went off into the ether. Let me try again.
First, you may get hit by a truck one day and have to get fixed up at great expense at a hospital. If you don't have enough money to pay the bill, which is likely, it will be charged to "free care," which means that all the rest of us who do have insurance will have to pick up the cost. By requiring everyone to have insurance, the premiums for those of us who now have it will be reduced a bit, which seems only fair. (The hospital must treat you whether you have money or insurance or not, because that is what we do in a civilized country).
Second, insurance schemes are always about cross subsidies, from those who don't have an accident or a medical problem in a given year to those who do. We want such schemes because we never know what year we are going to have those bad events, and because we don't want to take the risk that next year will be my year and I won't have enough money, or have saved enough money, to get buy without it.
Now in your case, you probably won't get your money back while you're young -- that's what the probabilities are. But by throwing in your premium, you will allow the insurance company to lower premiums for everyone else. And at some point in the future, you will get old and grey and need more health care, and at that point, because there are other young people in the pool, your premiums will be lower than if those young people could continue to opt out.
So on a life-cycle basis, it winds up being a wash -- you subsize when you are young and/or health, and you get subsidized when you are older and sicker.
Albany, N.Y.: Why do all these free plans have to fall on the backs of the working man?
Steven Pearlstein: Ah, another falsehood. What free plans are you talking about? There's Medicaid for the poor, which is free, but that exists now. Most of the stuff being debated now is requiring people to buy insurance and providing some subsidies for people who aren't poor enough to qualify for Medicaid but aren't rich enough to afford a $10,000 family policy. If you lost your job and fell into that category, wouldn't you like it if you could still have health care? And doesn't it make you feel more secure knowing that if you lose your job, you won't lose your health insurance?
Toronto: A doctor I know who now practices in the U.S. but prior to that worked in Canada told me that there are major differences in terms of treatment, i.e. more is better in the U.S. For example, a patient complaining of sciatica in Canada would be told to take painkillers for a month, by which time the sciatica might go away by itself. In the U.S., the doctor would immediately schedule an MRI, a steroid epidural and then possibly surgery, which doesn't necessarily have better outcomes than the Canadian approach and could carry a much higher risk. Is this a cultural difference or more a function of money-driven medicine?
Steven Pearlstein: That's a good question, a good example, and the answer to your question is yes -- its a matter of both economic incentives and the culture that has grown up around medicine and the expectations that the culture creates among both doctors and patients. If you focus purely on the outcomes, the Canadian system is better -- it gets better health for a lot less money.
Laurel, Md.: Steven, In reading conservative columnists, the one thing they seem to want to reform about health care is torts, which I heard Charles Krauthammer claim on the radio would save $200 billion/yr.
If that was included in a health reform bill, would the savings be passed on to consumers/patients/taxpayers; or is this a bunch more pro-wealthy economics to enrich doctors and insurers?
Steven Pearlstein: The number is grossly inflated, based on a survey of -- guess what? -- doctors, who of course think the malpractice system is the greatest evil ever to hit the face of the earth.
Look, the malpractice system is badly flawed and some caps on punitive and non-economic damages would be a really good idea, along with special courts and arbitration procedures to handle these things, as Charles suggests. But we have some natural experiments in states that have already done tort reform, and it doesn't yield anywhere near the savings that Charles and others claim. And that is supported by many academic studies and the Congressional Budget Office's review of the literature.
Arlington, Va.: While I'm usually a big fan of your columns, I don't understand your conclusion in today's column, referring to President Obama:
"And at some point he needs to look straight into the eyes of those who would have him fail and promise to do whatever it takes to break the partisan stranglehold..."
Two questions for you: first, how can he compromise with those who have declared that they want him to fail? (Unhelpful attitude) The Republicans' plans for health-care reform seem to be all about tax cuts (no surprise there) and tort reform. (Miles apart on substance) Where is the room for compromise? Second, for the sake of argument, how much negotiating leverage would Obama gain if he introduced tort reform into the mix?
Steven Pearlstein: For Republican legislators who basically take the stance that they will agree to no reform other than their faux-reform, there is no compromising. But you have to understand that there is plenty of disagreement among Democrat legislators themselves about a lot of these issues, and there is plenty of disagreement among Democratic and Republican and independent voters who actually want some sort of reform. Your mistake is assuming that the Republican leadership are the only people who need to be compromised with. There are lots of other people out there who need to be "negotiated" with before a national consensus can be forged. You are spending too much time listening to Paul Krugman and reading the Daily Kos.
Ashland, Mo.: Isn't a big part of the health care discussion a result of (mis)characterizing the issue as people having made bad choices so the government is going to make them for you? For example, "Hey, you 25 year old who chose not to buy insurance, you might get sick, so buy insurance or pay a fine. Hey, you older person, one more dialysis treatment isn't cost effective, so you don't get it. Hey you other people with insurance, you have yours, but others don't, and you have to be a good Samaritan whether you like it or not."
Steven Pearlstein: Well, you are on to an important point. Sometimes people don't make the right choices -- not just the right choices for themselves, but choices that impose burdens on the rest of society.
A young person who doesn't buy insurance and doesn't have enough savings and gets hit by a bus imposes costs on the rest of society when he gets free care from a hospital.
Similarly, an older person who demands, or whose doctor recommends, a procedure that is expensive and probably won't work, imposes a cost on everyone else who is in the same insurance pool and has to pay for that unnecessary or ineffective treatment through higher premiums.
Nobody has ever suggested that any American shouldn't be free to buy any health care he or she wants, when he or she wants it, from whoever he or she wants to buy it. This is a free country and a market economy.
But when you ask other people to pay for your health care, either through free care or through higher insurance premiums, then it is only fair that those "other people" get a bit of a say in the matter, don't you think?
San Francisco: Including a public option is essential for liberals, anathema to conservatives, and I don't think it should be a make or break issue, but it's turning out that way. Obama hasn't clarified his position on a public option, and how he navigates around this particular issue seems to determine whether reform succeeds or fails. How should he address this? How will he address this? Will he ignore the right and rely on the Democratic majority to include some kind of public option in the bill?
Steven Pearlstein: It's not a make or break issue and a Medicare for All option probably won't be included in a final bill. Myself, I'd trade the public plan for an employer mandate in a heart beat--and anyone who really cares about universal coverage should as well.
Paul Krugman And Daily Kos: Interesting that you chose to attack those two media outlets.
Do you read them or are you making assumptions?
If you do read them, can you elaborate on what falsehoods they have been promoting or where you have vehement disagreement?
Steven Pearlstein: How about that it's stupid to make any compromises from the most liberal version of health care because the Republicans won't support a bill anyway? That is the thread running through a lot of Paul's commentary, and a lot that you see in the Daily Kos. They're evil, they're stupid, they did it to us, they lost the election so *** 'em. Its a good strategy for getting unique visitors and selling books, but not a good strategy for governing.
it doesn't yield anywhere near the savings that Charles and others claims.: Pardon me, it doesn't yield ANY savings. Read those studies you referenced. Look at Texas.
Steven Pearlstein: That's not logical. There is defensive medicine that is practiced, it is hard wired into medical training and medical culture and it does contribute something to unnecessary care and costs. The only question is how much does it contribute, and in the end, there is really no definitive answer because so much judgment is involved. And that is true even if there are caps on punitive and non-economic damages, so the Texas experiment isn't fully dispositive.
Austin, Texas: So I basically agree with you and other columnists that say the public option isn't necessary in order to effectively reform the system. Why isn't this getting through to the more left wing Democrats? They seem to be digging in their heels about it. What's the basis of the current disagreement? Ideology or differing economic analysis?
Steven Pearlstein: It's become a political manhood issue and a litmus test among the ideologues.
Public Option vs. Mandates: As a public option advocate, I would like you to outline for us why you don't think it is essential.
I understand there are other options such as implementing a massive new regulatory regime, but they seem unlikely to be proposed at this late date and would likely cause a bigger uproar as that would be considered anti-market.
Therefore, can you provide a brief explanation of what you believe should be in the bill that will ensure premium costs are contained to the level of inflation at a maximum? Or, do you believe other reforms outweigh the need for cost containment?
I do not feel comfortable mandating purchase of insurance without assurance of non monopolistic pricing.
Thanks for a great article a usual.
Steven Pearlstein: Don't have a lot of time now to go into it, but there are lots of ways to think of to dealing with monopolistic pricing without having to have a government insurance plan piggybacking on medicare reimbursement rates that don't fully cover all costs.
For one thing, the exchanges themselves are likely to significantly increase competition in the individual and small group markets. And no proposal for a public plan has the public plan competing in the big group market.
Boston: Steven, how excited do you think Americans will be when they read headlines about Health Insurance CEO's record bonuses following mandatory inscription? All that and the great service we have come to expect from UNH, WellPoint and Aetna! woo hoo.
Steven Pearlstein: You can execute the top executives of every insurance company in America and you won't take even a tenth of a percentage point off the cost of our health care system.
There are proposals to limit how much of each premiuim dollar is spent on something other than health services. It is a form of price controls and it may well be necessary. That's probably the best way of attacking the problem.
Princeton, N.J.: Sorry, but Ashland's attitude is just plain stupid. What does he think government is for? Does he want us to run around like savages, every man for himself?
Someone makes a bad choice and his house burns down. Shall we let it burn down and burn down the rest of the town with it?
A bunch of people make a bad choice and won't pay to educate their kids. Shall we let them grow to be dead beats and become criminals or bums?
And so on.
Steven Pearlstein: Thanks, Len.
Abingdon, Md.: "Myself, I'd trade the public plan for an employer mandate in a heart beat--and anyone who really cares about universal coverage should as well." ...and what happens when/if you ever become unemployed? (As so many have recently.)
Steven Pearlstein: You wouldn't do any worse. Read the proposals.
To Richmond & Commonwealth of Va.: Yes, you have to buy health insurance or pay a fine. Get over it. You are relying on others to pick up the cost of your health care if you're in an accident or if you find out (yes, at age 24) that you have cancer. You may be healthy today, but there are no guarantees that will last.
Unless you are willing to tattoo all over your body "Leave me to die because I was too stupid to buy health insurance", get over it.
Steven Pearlstein: Indeed.
Philadelphia, Pa.: I want Obama to pass reform with a public option. I am a supporter whose support is waning and will cease to exist if he doesn't pass meaningful reform with a public option. Part of Obama's problems are that he is losing people like me. Another problem is that most people don't understand the facts. They think that a public option is free and wholly paid by the govt. This is false. The public option, if made available, would still require premiums to be paid by the insured, correct?
Steven Pearlstein: Thanks.
Minnesota: My question is the most basic one. The Republicans have at various times controlled various branches of government and yet never made Health-Care Reform an issue. In fact, as more Americans became uninsured, they refused to fund the public programs.
Even now they have not produce an alternative. They are trying to stop any change to the system. So why keep focusing on them? Insuring Americans is not their priority. In fact, it's very obvious they are more intent on protecting the status quo for insurance companies. Should that not in itself be a story worthy for the media? Decades of obstructionism on health-care reform. Seems like a pretty interesting story to me.
Steven Pearlstein: The criticism is entirely valid, if you use as your time frame the last 25 years. But remember, Richard Nixon actually proposed something that was very much like what Obama and the Democrats are proposing today. Only problem was that the Democrats at that time wanted a single payer system and were holding out for that. Turns out to have been a bad decision on their part.
Reston, Va.: A week or so back one of your posters mentioned how great Sweden is. My wife is Swedish, and while its a great country, there are many issues there that don't get brought up when mentioning the Scandinavian way. Case in point, her cousin is over here right now for a visit. He tore his achilles over two years ago. It wasn't completely torn so he could walk with a limp but nothing more (biking, running, etc). He was on a waiting list for TWO years to get surgery. Finally it completely tore so he couldn't walk and he got his surgery a couple weeks later. This is Sweden...a well run, small, homogeneous country! It will be a disaster in the US. Come off your high horse, Mr. Lefty. There are a number of ways to decrease costs like competition across state lines, decoupling insurance from employers, tort reform that have nothing to do with a public option.
Steven Pearlstein: Nobody is suggesting we have a system like Sweden. It is simply a straw man set up by people, mostly Republicans, who like the system just the way it is, except if they had their way they would actually want you to have less insurance and pay for more of your health care with after-tax dollars. This isn't Sweden and everyone understands that.
BTW, if you want horror stories from our system, you can find plenty that are much more outrageous than the one you've just told. Like children dying because they didn't get very basic and simple care. If you want to compare horror stories, trust me -- the U.S. comes out on top.
Alexandria, Va.: I like your answer to the 25-year-old who has other priorities. But say it's not a bus accident that brings him down but a random disease that requires extensive treatment. Not only will he not get the treatment, but he may be deemed uninsurable in the future. Sure, the emergency room won't turn him down, but the rest of the system will.
Steven Pearlstein: A good point. And with that I have to sign off and head off to a luncheon speech. "See" you all next week.
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