Krugman on Healthcare

Here are some great snips from yesaterday's editorial:

Health care seems to be heading back to the top of the political agenda, and not a moment too soon. Employer-based health insurance is unraveling, Medicaid is under severe pressure, and vast Medicare costs loom on the horizon. Something must be done.

But to get health reform right, we'll have to overcome wrongheaded ideas as well as powerful special interests. For decades we've been lectured on the evils of big government and the glories of the private sector. Yet health reform is a job for the public sector, which already pays most of the bills directly or indirectly and sooner or later will have to make key decisions about medical treatment.

Let's hope that extreme cases like the one reported in The Times a few months ago, in which surgeons systematically used the devices of companies that paid them consulting fees, are exceptions. Still, the drug companies in particular spend more marketing their products to doctors than they do developing those products in the first place.

But then there was a public backlash. It turns out that even in America, with its faith in the free market, people don't trust for-profit corporations to make decisions about their health.

In practice, the health savings accounts created by the 2003 Medicare law will serve primarily as tax shelters for the wealthy. But let's put justified cynicism about Bush administration policies aside: is giving individuals responsibility for their own health spending really the answer to rising costs?
No.

Moreover, it's neither fair nor realistic to expect ordinary citizens to have enough medical expertise to make life-or-death decisions about their own treatment. A well-known experiment with alternative health insurance schemes, carried out by the RAND Corporation, found that when individuals pay a higher share of medical costs out of pocket, they cut back on necessary as well as unnecessary health spending.

So cost-sharing, like H.M.O.'s, is a detour from real health care reform. Eventually, we'll have to accept the fact that there's no magic in the private sector, and that health care - including the decision about what treatment is provided - is a public responsibility.