« The Weeds

All 👏 payer 👏 rate 👏 setting 👏

2018-04-13

Dylan Scott joins Sarah and Matt to talk about Paul Ryan's retirement, his legacy, and the Weedsiest health reform of all. References: Sarah's all-payer rate setting explainer Dylan's piece on Paul Ryan's legacy Melanie Mason's piece on California's healthcare bill RTI evaluation of all-payer rate setting Health Affairs evaluation on changes in hospital use in Maryland

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This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
They are breaking a studio down like this afternoon, the end of an era for Paul Ryan and even at the end of an era for the temporary podcast India, hello, welcome to another episode of the weeds on the box media podcast network. I Matthews Oases really excited to be joined today by Sir Cliff until an Scott, and we are going to talk about all payer Setting a hot news of the week. I have been a really busy week. You know it's like James Commies book is out. Something happened with Michael Cohen, but they really The news that has happened on that hell, I don't know they lose. The news that has driven the we did is dominated conversation is a California.
Quaint all, but it's like most pay a rate setting, I would say I think, that's anyway, it's a drove staggering levels of public interest that we monitor by this together. But but first we are going to have a little bit about Paul Ryan, who is not going to be Speaker, has anymore he's retiring from Congress. He said aunt em, you know, there's been a lot of discussion, obviously about him and his legacy. Both of you do and had a really good piece about a sort of power, seed. Legacy of Ryan's, that is, is carrying forward very much in conservative politics, even as he fades from the scene personally and that's on medical. Right? All fits with the frame that you ve put on his announcement that he will retire, which is that you know Paul Ryan has not really did not sell out to Donald Trump. If anything, Donald Trump ended up adopting many of his policy positions, and I think Medicaid is a telling example of that Canada Trump set in no uncertain terms that he would not cut Medicaid along with Medicare or Social security and where-
you know, Paul Ryan has apparently been dreaming, since he was a kid about cutting medicate and overhauling the programme. This is like an actual thing. He said he said he yeah college. I was doing keg stands in college and aiming of bought granting medicate. He raises drinking out of a king on us. Of course, it's totally normal thing to be doing anyway. They were apparently completely at odds based on what trumpet senator candidate and the agenda that ran has pushed when he's been in the house. And yet, when you look at what the Trump Administration as act he does not only did Donald Trump endorse. The Obama CARE appeal plans that would have put a federal spending cap on Medicaid cut the programme. Spending over ten years by a hundred billion dollars and lead to fourteen million people being kicked off. The rolls once my repeal failed. The centres for Medicare and medical services that trumpets ultimately in charge of, has started to institute work requirements.
Still whispers that they could look at trying to approve a block grant a federal spending cap. If a state were to request a waiver to implement that kind of policy. So basically the Trump Administration is doing everything it can to pare back the medicate roles, which is exactly what Paul Ryan had dreamt of doing for so long, and Oh Canada trumps promise not to cut medicate as long dead and Paul Ryan streams of of overhauling the pro m? While you know he's in failed and making them permanent by giving Congress to pass a law? He certainly got the Trump administration doing the leg work for him, although it pretty far, I mean, I think, if you look where we were a year ago, this is basically when the house was passing their Obamacare repeal appeal, and that was a proposal that came from riot. The bill that they passed last May was built on these white paper, at his office, had been pointing out kind of like laying the groundwork and again really deep cuts to Medicaid. He got his caucus too.
for ending the Medicaid expansion and for creating a big allowing work requirements, but also creating these caps on Medicaid spending which have never really existed in the programmes history before so he certainly Instead, pretty far, I may think the other Paul Ryan legacy and healthcare dear miss not to mention is, is on care and Juno some pretty significant reforms there that feeling to me were signature, Paul Ryan policy per his ideas of cutting back on Medicare kind of making it more of a programme with a per capita spending. Instead of this unending entitlement programme and jam assent having seniors shop for different Medicare plans and using this kind of voucher that they would get. So like that hangs around even with Ryan, longer being on the hill and a few months from now that's
going to be a legacy, that's really going to stick around policy wise up there I mean which interesting about what remains of minors from where he started is that it look industry of a regional Ryan, sweeping vision of privatizing Medicare capping spending block writing Medicaid capping spending, I would say, as an objection like this, is going to be really bad for poor people. and I think Ryan would say I mean I think we say that that's false because he's a liar, but he would make a different point about it, which is dead. Capping the growth of these big healthcare programmes is, can make a big difference to the long term trajectory of federal spending which is important to him, because it helps you keep taxes low, which whatever it is, helps which people had served cosmic justice, it grows economy or whatever. The reason is about is what to do that.
when you zoom DOW, until I do not privatizing that care do not block granting Medicaid you just doing these work requirements, there. I'm still on my hill saying this is really bad for poor people. really sure what the counter claim is, because the just the aggregate amount of money involved in this work requirements thing is just like That big right like it's, not like? Ok, if this war Grammy, if this goes through and Democrats, never reverse said, and we have work requirements, I medicaid in every state for able bodied non pregnant blah, blah blah blah blah, It's only that means tax revenue U Dot, seventy percent of GDP magically becomes do we have? This quote was was at hand who talked about people may have acts like. I feel like I get. The Paul Ryan Ethos on that, So I think that here it is less about the tax dollars array and link, at least to give the guy can understood. I don't agree with the argument, but I understand like what's going on
Then there is talking about. You know that the dignity of work and the idea that we want to use these grams not as this a hammock for people to sit in, but as something to transition them back to working, because, you do not necessarily because of the global will lower the spending is less and less Medicaid. When you have a work required, I think the argument at least to give some is to add. Is that These programmes should not be a long term solution, the people who use medicated that they should be thought of as a temporary solution and that a work requirement is going to bring more indeed the lives of these people who are using these friendly baby. I just think I do the work. When's issue puts thee values issue squarely right. I mean it. A lot of the narrative around Ryan for the bulk of his career was like budget focused on you.
Google is like a million things about like how he's a budget long about the green eyes shades and viable by, and would significant about the fact that we were left with as he exits. The stage is this work requirement is that it deduce money involved, but it's not a budget game changer. This is about, and freeze the different ways, but like it's about being stingier to poor people on the theory that, like giving them a swift kicking, the pants is gonna, get them to shape up. There lie if there's something not that we're gonna save tons of money, even spell- I mean I think, SARA Ray like that's. How Ryan would articulate the argument about the dignity? work, but we ve even seen some interesting evidence this week about sort of how the Berlin Reality belies the arguments, the Republicans make about work requirements and the dignity of work Centres on budget and policy priorities put out a study. this week that we were rode up, and I won't do on it too much, but the gist of it was even people who are
working enough in the aggregate over the course of a year to say fired- the work requirement- the Kentucky has put forward twenty five percent of them are likely to have at least one month during the year where they false sort of the lady, our requirement that Kentucky requires them to work in there for at risk of losing coverage, and so it sort of like even a working person, one in four working people who could be subject to this work requirement and who, by all sort of normal conventional definitions are working, could still lose coverage because of the way that these requirements are structured and sort like that be curious to hear what Paul Ryan thinks about that, because that seems to be like two mats point. This is just wait a call poor people off of the rules, because they're so rigidly structure that they don't reflect the realities of how poor people actually work, which is that their powers,
the ebb and flow they might have a gap in employment because they work and seasonal jobs, and that sort of thing- and so I think that is a serious point. That's the argument, but I dont think it reflects the reality of the ground and that that all evidence, that this is really just way to cut medicate. I also think it is something that you know I've been thinking about recently, because I've been trying to in Rome I sign in our neighbourhood public school. And this requires a residency requirement you have yet to live. You know in the right boundary and it's fine I mean I don't find out to be politically contentious. The disk MR wants to verify that I live there? We have to verify that Jose as the appropriate age for the greed we're trying to get a little the good ideas? No no controversy about it, but it turns out to just be a quite the paperwork. Slaw click it it's not even that it is harder than you think. Just because I had not been living my life with a view to documenting that I actually live in my house
precisely because I do live in my house, so it was like. I have the wrong address on our office payroll system in all kinds of little. Complications like dad and it's a reminder, minors, when you create new requirements right, these requirements are not self in. It's saying you know you gonna need a demos. citizenship to you. Some kind of public service seems reasonable services. Should be for citizens but like if every time you got on the bus you needed to like verify that you are read that there will be huge pain in the ass, and showing that you're working. But you calling for people who are the margin like like your tongue, my darling, you know people who may have more one seasonal job right. The way you become poor is by not having steady work tippit,
and so, if you are thinking about people or on their margin between not working at all and working some, and we would I'd or ideally like them to have a more solid work and more money, but there in that a limit all space and you creating more problems for the ride, justice in terms of documentation and and verification, and it's a real I guess we'll burden on people for every one the person who you kick off because their genuinely not working and one person who goes and works more because the requirements differ in their spine. This can be like fifty p, all who are just still getting the benefits, but by now have to do a tremendous amount of extra stop there to underscore the perversity of it. I think Tennessee is talking about creating a medicate work requirement and to pay for the administrative costs of doing so their time
taking money from ten of the federal Cash Welfare programme and taking that money, so they can cover. You know all the paperwork and bureaucratic this bureaucratic work that's necessary to implement a medikit work requirement which he's in a with AIDS. So, like antithetical till how Republicans talk about the ever standing Brok, bureaucracy and all that paperwork that the government should go through, but when it's for a medical work requirement, apparently it's it's ok. So before we get to are the Big NEWS, Voltaire rate setting as carries done using those time of the hell of of any of us like? Where does this leave the republican cockers? Unlike what is it you know next year will look like to you a ride, unless a unless caucus and like I don't know Where do they go from here? What changes are? What doesn't change policy was. That's conquests, obviously the biggest question: whether they will be in the majority or the minority. Still, I do think Canada mats point like they ve kind of lost the plot,
Cynthia Ryan became speaker, because for if, however, you, held about him in a personal way, whether you thought he was too cosy with businesses or whatever, like he, articulated the conservative agenda better than anybody, and even everybody from the Freedom caucus to the more sort of moderate Tuesday group Republicans could could get behind him, and I don't get the sense that sort of from a policy agenda perspective. There is another. Person who could really fill that void, and so I think it will be interesting to see when there is not with a single person who, who has sort of taken up in personified all of the conservative agenda sort of does it becomes little more free wheeling and you have chairman who start to become more powerful because Ryan had centralized policy making so much in his own office. I think that's what
what be interesting is is it it had become so centralize in part because they had an actual agenda to implement with Trump Becoming president, but also because Ryan. You know new this stuff and talked about the stuff better than anybody, and I dont see an obvious person to take up that mantle. That he's been caring for the last.
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Are we to vans edges away? I'm look leave, but the answer Klein Show is still growing strong this week check and this debate with SAM Harrison reason I too, and its follow up conversation with historian Carol, Anderson she's, the author of a great book called white rage, and these are two really amazing conversations. We wouldn't want to check at Sir what what and what went woodsman doubling the headline man you guys it's it's not call me! It's not coincided. Is California. Looking at some price regulation, so this is a building across some kind of my radar from a story that Melanie Mason Road in the LOS Angeles Times on Monday, looking at plan where these state would have a commission that would set medical prices in California. And dignity. We can take this a few directions. I think there's like some interesting politics and interesting policy, but
really just an excuse to get to. You know one of those click they topics. Fur are weeds listeners, all payer rate setting which, as I have Skype did on VOX is almost a back door. Single pair Ynez I've been in more researchers episode. I've become more aware of the flaws, This model which we can get into as well, but basically we California, is doing and talk to people sponsoring. As you know, a lot of the legislators, as well as some of the advocacy groups and the kind of recognise that there is a big single payer- push in California right now, mostly from the nurses union and while that would nice and all of these groups are single pair supporters, they're kind of looking for what can we do right now like? What is a thing we can do on health, spending in the Trump administration, something that one to require federal waivers, something that we can just get off the ground right here. Right now- and the thing they settled on is what, if we had, these states regulate healthcare prices, we set up a commission- and
a commission will kind of use Medicare as a guide, because someone else has already done this whole big priceless and they were figure out how much everything from a new replacement to a particular pill to an apple after me, should cost it's a model. We see a lot of other countries, and I think of Germany Switzerland is all payer rate. Setting model where you have some kind of centralized agency and you have competing private insurance plants. It's not like the doubt where you have one plan that covers it? Prevents people choosing between private plans, but the prices at those plans? Pay are very tight. regulated and that's really the opposite of the american system. As I noted in this story, I wrote about California: has plan right now, I an appendectomy in California costs and he, where, between fifteen hundred and five hundred and eighty two thousand dollars, depending on good you're insurances, is negotiating that's Roma researchers has been doing a lot of studying of healthcare prices, interest, creese
The amount of variation, so the idea of all parrot setting is to increase efficiency INA by having everyone paid the same dinner by. Ideally that brings down the actual spending and also gets a brand of a lot of the bureaucracy, because hospitals of their back and offices that are figuring out. You know shit. I pay this insurance. Fifth, hundred or a hundred eighty two thousand for the same You so I'll stop there, but that's kind of what's up in California right, I think you know basically way to think about this. Is that if you listen to a Medicare for our proponent, like one thing they will say is Actually, this is gonna be way cheaper right. If you look at many care a covers, people Medicare will cover a sixty five year old for less money than a cost to cover that person. When there were sixty four by it I mean it's, all, people are expensive, but when you switch onto Medicare it saves money. If you look at Canada right, it's cheaper. In the U S, health care system and visa. Well, why is that ride like as a magic
and like is magic cried, is that their paying less they're using their greater purchasing power. If you dig into a medic care for all plan it'll typically, you know there's a little bit of hand, waving fudge factor, but there's usually some bad guys. They are now a glow, we're gonna squeeze farmer and you know we're gonna pay them less. So that's great great, but it's the government right like you don't need to nationalized e health care payment system. In order to Deuce pharmaceutical presses, like you, can just pass a law saying drugs now. You can pass a law staying the MRI say, cheaper now, pass, a law saying what we're gonna pay. What in hell patient you, no visitors, gonna cost is cheaper. Now, glucose does our magic either. like, if you say an mri, gonna cost a nickel, then, like people aren't going to offer the service at that price, but single mayor has that exact same issue right and so the vision of all pay arrayed setting is that if,
trying to save money by having a government rule that makes the price lower. You can just do that right without also radio, the whole back end could be complimentary or or not. But did you know to the extent that what you like about a medic? for all system is it is gonNa Brean unit prices down you can at least just do the part where you bring the unit prices down. There is an interesting metaphysical question about whether it would really be the case that I am keeping my same insurance plan. If a government regulator came in and changed how the healthcare system works, but it in a superficial sounds like. I would keep getting my health care from my job. There would still be done. The same.
are delaying the logos and websites would be the same. The hr departments would like still be administering things. How disruptive it would be in practice would have to do with like that, how big a deal that regulatory change was. But again I mean a America's role system. Has the exact same question right, which is good? freedom of the press is a lot, but then people might freak out. leave town or you can change it, a letter, in which case it will be more stability, but you won't have is as big a gain. So I was wondering about this. Actually, because I was I read, Sarah's explain her original kind of big explain about all pair rate setting which has great in anybody's interest in this, should go back and read it, but you framed it in this was a few years ago as Lake single parents a pipe dream, and if we want to if you want a kind of achieve some of the same goals and more realistic thing in something that states have actually done, is all pair rate setting an obvious
and I think you know that it was fair to characterize single pair that way at the time you you mentioned, that, like Vermont had just failed with their planned institute single pair there, it seems like the political salience of single pair has changed over the last couple of years, and I guess I wondered if we, if the Weeds brain trust so thought that sort of all parents Sitting is obviously sort of the superior more practical way to get it. Some of these summits, ideas or whether a single parents going to close that gap, given the way that Medicare fraud has become a kind of a rallying cry for Democrats and is pulling much better yadda yadda It just crossed my mind because it seems like a totally fair waited to to frame it then, but it seems like a lot has changed over the last couple years. From the power to you earlier, having its notable that every democratic front runner for twenty twenty is now a single payers supporter, which was definitely not the case and twenty sixteen or twenty twelve. You know that Sometimes I think of this point.
Killer moment. You know, and we have the Trump Administration any sort of single our system you know at the state level is going on Some kind of permission from the federal government and the expectation is the Trump administration is not going to give those Waiver permissions, so when I think of it, California. At this particular moment, it makes sense to me why go this way. and they were very you know we can talk about other arrayed setting are now talking about Maryland their system and why? things Maryland dies as they really do set across all payers that they have a waiver from the federal government that let them change Medicare pay, is in medicate kind of like a true all payers rate setting system? California very clearly just made the decision not to go that route, because they do not want to deal with waivers. They want to do something that they could do on the state level. It raises a question like what is your goal with healthcare system. Do you not think that we need
rid of all the private health insurers, or do you think that you know with tight regulation? We could do exactly the same thing with less disruption and end? I lean towards, second one, but I have a super strong opinion and I'd be opened being so otherwise, just by looking at like a number of european countries that have done it, that sort of you know the Switzerland's in Germany's of the world that they make me think you could get efficiency. Is of a government run plan without going all the way there and given the starting point. We have right now that that might make a little more sentence for the United States. I feel the timber and the Democratic Party has changed not so much on the substance of the healthcare issue, but on theories of politics and that people, you know, if you talk to
Jim crowd senior Democrats on the hill in two thousand and eight or two thousand seven. They were obsessed with what they took to be the lessons of ninety ninety three and ninety four on health care and that led them to a particular kind of strategy- and now I feel like Democrats have, would they take to be the lessons both of us two thousand nine, but also the lessons of the twenty sixteen campaign and the lesson that they ve taken away? Is that these Lincoln saying that, like you, campaign in poetry, new governing prose- and I think that was tendency. among some Democrats in the arts and very pronounced tendency among Hillary Clinton personally to campaign in prose. Like now. I think they want to campaign in poetry again and visited almost unruly question of like what do they actually want to Do it right? I think it is
challenging when you, when you'd Surrey kick at that tyres you know, stand a demagogic, endorsed Medicare for all plans and then what the plan itself says like how fanatically committed? Are they to that specific vision? I think, is very unclear, here. What do you think is true is that most people who are liberals in America think in an abstract sense that the canadian healthcare system is good, right right, and so there is a growing sentiment that if that is a thing that you think and you represent a blue state and you aspire to be a national leader and democratic party politics. You should just say yeah right and then there's like a different? A much more like Obama is viewed as a moral try to write a plan that I can imagine passing, and you know doing this. That and the other thing I like the conceptual just
sanctions that, I think, is important between sort of national nurses, union vision and all their red setting is whether care should be free at point of service right. which is actually different from single pay or not rights to like actually existing Medicare is not free at point of service, but court on Court Medicare for all and canadian Healthcare and Uk Health there is an that seems very important to the nurses is very important to Bernie Sanders. It's a noteworthy right, because it dramatically increases the cost of things to make them free at point of service lots of governments. Heiresses are free like that. If you want to go to public school, you go to the playground. It's free avalanche things are and read the buses and free, even in the good old days of public colleges being cheap. They weren't literally free,
and that's like. Oh, I don't know like it's an airy philosophical question. Rather, should we try to ration access through a price signal or should really be that, like you, get all the health care, Why trade and obey arrayed setting is very much like you we'll make health care a lot cheaper. That way by the idea would be forgiven non zero prize. Otherwise it will really make any sense. I want to go back to operate settings. I won't talk lover out Maryland, whose is kind of like our test cased states that one of the things you saw happen in the ninety nine years was. A number of states are mostly in the North EAST, passed all payer rate setting scheme so that it may now we're talking. Yesterday, literally no debate in health care is new there. He burst her, like the nineteen, seventeen and nineteen eighties that are basically having the exact same debate we're having when twenty eighteen, but in the ninety nineties, albeit rate setting, was kind of like the new hardness and away you saw being met in places like New York, I think Connecticut.
add one, and then you saw liquors fast, start wave of appeal and most states all of them, basically, except from Maryland, repeal they're all pair systems and the reason they do that- and I think one of the big flaws you would see with a plan like California is, is that hospitals are dumb when their praises get You know, there's another way to make money. It's just to do more, so you saw in Maryland really did in its struggle at this. Unlike the late twenty two thousands early, twenty tens, you saw prices were down, but it wasn't saving money because there is just more health care being delivered, you know that they figured out, though the way to make money in this new regime is to just do more services and there's no real control. That too Marilyn did in twenty. leave the waivers approved in TWAIN, twelve and it started, and twenty fourteen was they layered a global budget on top of their rate, pay breed setting authorities. This is one of the most confused
healthcare schemes I ve never written about. I remember as at the Washington Post when I had to write about this new waiver and is firstly one of the more the most challenging stories. I've ever read end, but basically but they figured out was that all bear rate setting on its own sometimes actually isn't the powerful tool we think it's going to be. You know, even if you set the price, for conducted me and I don't think like there's malpractice going, but like on more edge cases. You might just do more of them than they just become standard practice, What Maryland does Now- and I think you know I've been looking through- there's a visa. This fight in the health care literature about whether its working and I think, there's no earlier and that it seeing some promising signs, but not all the way there they essentially give each hospital a budget. At this point and say this is how much money you get for the year and that changes the incentives pretty significantly where there is less incentives
you to doing more solely. I think it is notable that Maryland, which has had the longest standing operate. Setting system has kind of moved away. From the rate setting part of it because of some of the perverse incentives that come up and I could see you know if they scale when your belgian pass something similar unfolding out out there, and that is something I think a healthcare system needs to guard again stood away, but here I think ignore me would say: oh the plan healthcare services cheaper so if you are already buying healthcare services. Now you save money, but it all I dunno arrive more services, so healthcare became both cheaper and more plentiful. Ok, so would think about that. As my premiums didn't go down, I think that's what people want right, that they want to be able to pay as for health care- and they did because you're hospitals doing like more mri scanners and doing veto. more care, and maybe some of that was indeed
So I guess I Haitians you're getting more care that around, but it's not necessarily to your ban evading there's, a question that are you getting healthier vocational? I praise this is a normie. I remember. I think this is important as as liberals Are you, monks of cells, and this right, like this, a huge like walks, verses, Normie, split on the question of like? Is it good for people to be able to consume more healthcare services right, and, I think, This is ultimately like why the politics of Obamacare cap blowing up right because leg in the Obama vision, there's like a handful of poor people who need to be able to consume more health care services, but like most people to consume less and that's why we're like bending the cause curve, Bob Bob Bob, I believe a normal people want is today go, see the doctor and to have that be cheap spread.
They want their. They want their premiums to be cheap, but they also want their visits to be cheap. They want their deductibles below. They want that co payments to be low. They want, like the healthcare to re, think that's quite a deadline, because a few know if, if everyone is going to the doktor all the time, then you're not getting that lower premium, and I don't know like what the trade off is I make my mind like. Oh, my premiums are going down but like I pay a smaller. You know: co insurance. I go to the doctors, I'm feeling developmental aid of a hypochondriac. You I mean, I think another way to think about this is that everybody seems to agree that fee for service healthcare is bad where you just pay somebody for a service, and that gives doctors and hospitals and incentive to rack up as many services as a can, because they're gonna get paid more and I think, to Sarah's like all pair rate. Setting put some light. it's on how much you can exploit a fee for service system, but it doesn't totally remove the incentives to just rack up as many services as you can but
but what Maryland has done by layering on this global budgeting, where its just like we're, gonna pay, the same price for every service, but were only gonna pay you so much in total that actually to start to rein in the costs and potentially, if that leads to ensure as paying less theoretically, that would start to bring down costs for sure people, I came out of this wondering if the only way to really make all of this work is to have that two tiered. Not only are we standardizing prices but we're starting to put were putting a cap on how much we're gonna let in health care or other I think is also which, on my g out graffiti Iraq is Maryland, is also a unique, beautiful snowflakes. But big man is like funny shaped state in which the vast majority of people live in this, like pretty narrow corridor from the dizzy suburbs to the Baltimore suburbs and the city Baltimore it
a fright, and that area is like GM, packed with healthcare facilities both because, like Baltimores US city right, like cities, are at the Centre of Healthcare, because the an age is like literally in the Thursday in the in the disease outbreaks, big healthcare territory right comparable to Massachusetts and, in that regard, right densely populated, very suburban educated, like tons and tons of of healthcare around in we're. Only talking in the reasoning relates to hospitals, right, specific read so Marilyn has a lotta hospitals and a good amount of transportation. Flexibility, some kind of potential competition type stuff there. So All things considered, I would say that hospital focused price regulation in heavily urbanized states is like not actually, where would expect there to be a lot of
gains from something like this. It happens to be that Maryland as the state that does this, but when you're talking about state where you have a lot of monopoly healthcare providers. Right, I mean you're. Talking about a typical patient in Montana. Probably does not have a lot of hospital options so, Regulation could be a much more powerful tool there. There's the risk of like blowing up right, will you like Lou one, hospital and half the state now has no access to treatment. But it's a kind of thing we're like in a standard economics framework like regulator. Who does it well could help a lot and a regulator? Does it poorly could like generated? after the world price regulation would be a really big deal, causes no competition right and then again, pharmaceuticals, which, when this comes up all the time, people will call it, like bargaining,
Current glowed, but do song about price regulation ride so because for pharmaceuticals, because the marginal cost manufacturing pill is very low, the odds creating a catastrophic blow up by bringing the price down are also really really low and people you know really make it up in volume. Tactic has asserted different valence there, like I'm, not gonna, take medicine for an illness. I dont have things didn't make it out together selling my birthday there's a lot of people with chronic conditions who are taking pills and the pills are expensive, and if you just made the pills cheaper, they can save a lot of money. That's not what Maryland is doing right but like in in Germany or Switzerland right at a national level, all paired ski him, like that's one of the major prices that you would be regulating isoude right I mean it is bargaining and away. He says they one of the things that, if you go even further to that, I, like you, I am end up in discussions about local. Where are we even going to
cover that serve as new see those discussions kind of happened last around a hospital services where I think, most things that hospitals do would tend to get covered under a rate setting scheme but more around. You know what a lot of expensive cancer therapies. For example, you see constant fights over this in Britain over, you know when nice Dm National Institute for clinical evaluation, I believe is what distance the pan readjustment silly where they say you know this drug maker wants to turn to axe and like work willing to pay for it, as we don't think it actually delivers good health care so we are now going to, and then you see huge consumer outcry. So one of the things around rate setting they think like is a level of of bargaining, is that they provide at some level do have, ability to walk away anything it's easier for drug makers, because you know we're talking about the marginal cost, impels their selling all across the world. Its heart, for you know like Johns Hopkins huh
but all in Maryland walk away because they have built a hostile in Baltimore Maryland, and you know they can't really just go go she ate what like Deasey over Janeiro somewhere else, but I think there is like that, and the other things that gets challenge, while buried setting the single pairs systems is the only way that you have teeth and station, and this is interesting. Health care. This is more general if you're willing to say no to something things or else you know the person your negotiating with is going to have all the power and I think that's one of the kind of challenging things going on and I think, even in a hospital rate setting system you will see hospitals organised around like how they think they can make those profits if they feel like they negotiated. really well an mri, they may like start by a few more Mariah machines and sing. Let's go get that double MRI, better, better, safe than sorry verses, ratcheting back things, a little bit less of a margin, and so I think it's tricky business. The logistics of actually does going
The theory is setting the prices to actually setting good prices and, like you said as particularly, I think, for borough, hospitals that are operating with a small margin and where patients, you know, don't really have much choice of where to go like that, can be a pretty big deal. To get that get that wrong and make it impossible for those hospitals operate. Saw this urban rule issue that map brought up. I'm, risk, as my sense wise, you mention the the vicious swung fight about whether this is a working or not, and am I sense was, as that was kind of one of the points of disagreement. Is one study looked at sort of the earth implementation, which was mostly in rule hospitals and it didn't seem to be working gray. But then the more recent study took a more holistic view and
and looked a little farther along in the timeline, and they seem to find that in that we were finding savings in this was working pretty well, and I was curious you, you know this issue better than I do. I'm curious where you kind of came out in this fight. Like basically, is this working in Maryland. Silence on the first day you mentioned their half the fairest study which looks at so what, when Marilyn kind of started its rate setting scheme? You know the waiver they had about seven or eight years ago was just borough. Hospitals and it didn't have that global budgeting element in it, and you did have this finding that it wasn't really. doing what they wanted it to do. It might have been doing look as though it were wanted it to do your saying: lower prices, but higher utilization, and that's when you see the layering and of the global budgets and expanding to all Maryland hospitals, and then you have to separate studies come out one from JAMA, which is independent of the gun.
Meant and one from our tee. I, which is the evaluate that CMS, is using to look at how Maryland is going and I mean I've read through those. I generally think that there is is but a thoroughly is how I think about. What's going on there, that there is some promising results, particularly around certain am ambulatory conditions that your sing a reduction in emissions but There is also some questions about how its interacting with the outpatient system, that society this system isn't rate regulated and like are you? being like a shift towards that. So Similarly, I mean Marilyn's latest iteration of this only started and twenty fourteen and were still getting data but it seems so like from the research, I read that there are certainly some promise they earn its five year project right. We got a couple warriors go yet
we're through three years and evaluation is a little interesting how little impact this makes in reserve practical love all right. So we we all three of us live in Dc Maryland is like Estonia way. Until we all know people who live in Maryland, Ayala subjects to all pair rates without like what's it like people talk about this have like. I know, people who, like used to live in DC, but they moved to the suburbs or who are relocating to the area in considering like marijuana Virginians, like people pay a lot of attention to like their commute property tax rates to some extent, income tax rates- if they have kids public schools, think I've never heard anybody mention the alike to comply. We different conceptual design of the health insurance system visiting crossed my mind, even though how they I mean, there's some obscure policy issues in the world but like health care, is like this. A pretty high profile
People are aware that this is a thing that exists and it does not whatever kind of difference. It's making is not a big enough difference that anyone seems to timing me the way re study at a when Medicare girls studying at their not like. Looking like our people again can better deal there. Looking at the federal government getting better, like they're looking at it, and I think this is something as has talked about alone, I guess it they're, very, very different definitions of affordable and cost saving right. For me, the patient the verses Medicare the person paying for health care. and there they ve been pretty happy there Medicare with their evaluation. They feel they are generating cost saving because you're seeing less utilization of these higher Your values, services that it seems like hospitals, are doing something because of the global budgeting to train ratchet down on that, but like for me as a. Person that doesn't hold much salient, I would actually be interested to see like flows of retirees Orson like that right, because I mean what
you could imagine right, like a state, doing something to reduce its localised Medicare spending and so the like medical, administrators. I go. That's great billing. Actually senior citizens hate it right and like either there being made miserable or they're leaving to go so myself, because I also like one way you could reduce Medicare spending in Delaware essay that well, if you're over six, five and go to the hospital you get whacked on the head, with a baseball bat because I grant you either. Wouldn't go to the hospital argued move to a different state, but like would you have, hoped anybody with that like no, obviously right, that's a bad idea with a lot policy areas where it is like states when the university system, so we have some thought telling view a really bad job of it like that, would be bad for your state like we will want to go there. Businesses want love like it. Something like that and it's just, I think I can interesting questions
is Maryland managing its healthcare system in such a way that makes it attractive or unattractive to people or businesses. It is the richest state in union. Where did not used to be the case so and if you do something to this point. One of the more interesting findings in the report that was even pretty positive about how operate setting and the global budgets was going is in. This speaks a sort of normal people's exe variances what the system is theirs as idea of continuity of care and a sort of a general theory in in healthcare right now that if we just give the health care system is set amount of money that will that will encourage all the differ, providers and the doctors in the hospitals and everybody whose the system to work together better and will provide a more kind of holistic and seamless experience for the patient and yet Artie. I reports, which, as the report that I did, find savings for the federal government.
They didn't single out that it did not seem that hospitals and the doctors that they work with outside of the hospitals had done any better job of sort of making the patients experience any better or improving on Continuity of care, it seems like almost year. This has been a budgetary exercise and maybe even a successful one, but it doesn't necessarily seem right now that, in terms of the health care that people actually receive that it's all changing all that much. Maybe that's to your point Matt. Why can seem sort of invisible to the patient round it stuck out to me here. I mean an ideal health care is a complicated this ladder and stakeholders in it, and I think that each dunams becomes unclear in these discussions, like whose problem are we trying to how and why And a white and trade, and so the Marilyn evaluations, see,
to me to just take for granted that what we are interested in doing is reducing aggregate healthcare, right there there's not a lot of interest in other potential dimensions of this, and I don't I. I have like some sympathy for four. Why they're looking out at that way, but it, but it does seem a little bit strange to me like, I'm respects it's like? I would rather see similes evaluators stepped back, and MIKE Look, I mean, I know why they don't but like what's up with Marilyn, what are the problems in Maryland, society and like? How can the healthcare system help contribute to fixing is problem swayed because otherwise it become re serve and more because you know people's tastes, stiffer that health status differs are priorities differ like it's very nothing
works for everybody in all situations and whatever, but you can look at a place and say like what is the issue here like? What are we trying to deal with? And it's not totally clear to me like what Maryland is attempting to accomplish with this box. I think they're attempting to Hamlet S am tumblr, what's triple aim of lower woods. It lower spending better quality and interact so I mean I think I would give them give Maryland a little more credit here. The ideas to make sure that. They are providing the care that people need while making that care affordable for the state to they have money to spend on other things like education like their roads. The myriad other things that a state or federal government would want to spend money on, and I think That is one of the places where, with the we'll budgeting. It does become something that I would imagine that people regulating better are guarding again because one way to hit your global budget is just too you know, like you said like just not provide.
There is very, very cheap to say I don't the union that you need to come in. That's a lot cheaper and I think when you Look at any evaluation, I've seen of global budgets like this there's constantly a I'm. Quality and like what is happening to the actual people who are getting cared. They think would be quite worrisome if we saw Maryland meeting of savings targets, but all of a sudden, like the mortality rate of Medicare enrolled, skyrocketing or something nursing. You do some kind of negative health indicators, and I think I would be surprised if that is something that the government is not is not looking at me. No, they evaluate and keep an eye on Maryland because they are under. You know, Medicare. In many cases they are under the federal government's watch. This these evaluations exists? That's why you know we have these reports Marty eyes, because Medicare is watching what is happening, and you know likely using that information to make decisions about whether they will at this
bend and in another state in the future fully. We know right that, if would you concern about dislike population level, health outcomes they dislike fussing round with the hospital payment system is not the way to do that re having it's one of the ways to do around thing. It's gonna be everything, but I think it certainly like a tool in the toolbox, along with, like things like Baltimores Health, commissioner, is doing an obese AIDS, long other things going on. I dont way. I think it's something and we can like it's hard to re elect. We shouldn't minimize how just difficult it is to do this, like Obama CARE or the Obama administration, launched an initiative that weeds westerners may be familiar with called accountable care organizations. We work founded on the premise that, like art, if we just give this group of doctors and house was a set amount of money and sort of encouraged them to have higher quality by giving them bonuses. If they do have better outcome,
comes in, and some sort of founded on this were exactly what we're talking about, and yet there is a pretty big debate right now about whether it's done any good, even though it's been in place for a couple years, so it might just be like? I don't know if we have any great ideas for how you can both costs in czech law also delivering better care. There ve been my point only being that there have been initiatives devoted to this end and it's not at all clear that they much success. I am cares you, u has covered the Trump age ass and again we were talking about work requirements set before like. Are they doing anything else outside that sort of area of the in the programmes of Boylike are there some of these Obamacare initiatives that day fly can are expanding or they killing stuff like they have thoughts about sort of like mainstream Medicare usage. By non or people they haven't done a lot like the one thing. I can think that they did do. Is they ended there? The Obama administration had started a programme that would do a bundle.
and four add for joint replacements for knee replacements. What again a similar idea, we're gonna give you a cent amount of money and so that, and that will encourage you to make sure that you you have these costs targets when you're replacing somebody's knee and the term administration ended that I'm pretty sure to my knowledge, they haven't really express a lot of interest in other kind of payment reform models that would try to meet this both cost and quality. question yeah, I mean those generally true for the first year, re two chests under Tom Price yeah lies sense. Is that might be shifting with our new age S, Secretary Alex's are in temperature to former orthopedic surgeon, orthopedic surgeon or not thrilled with these global. You know where they are some of the ones who are most affected by the joint replacement payment changes. So I think Tom Price felt like a bit of an outlier to me and that he was not so keen on a lot of these paper value initiatives which.
actually tend to be decently by partisan. I think of you. I call it operates, setting that's probably a polarizing term because, like we ve been waiting here it sitting as a back door to single payers. I think things like that: are not moving forward, but The idea of you know it gets into like a kind of by partisan area, when we're talking, You know set payments version procedures. I kind of like edges us towards this idea of per capita caps and like more governments, price setting to create limits on spending, and it ends up and running. weird by partisan area that has not been nearly as polarized as as affordable care acts, insurance, expansion, so I think its a bit. I mean Alex's, our has been in office for three or four three usher so months. I think at this point, early. So am I dont know what it looks like under him, but he's kind of a guy be driving a strain
speaking weird spaces. This gimme are our last episode and this oddball temporary podcast studio looking forward to coming back next week. Machine I guess you know it has backdrop. Syria, oh claimed. Ok, someone else is getting the new studio. Where did we back in the old sue? Your, but it's gonna be amazing grades. We hope you will be with us there next week outline thank Dylan for joining us thanks to a Griffin, Tanner engineer, thanks a bridging Armstrong producer, of course, to our sponsors and to all of you out there listening we'll be back next week,
Transcript generated on 2021-09-12.