The problem with deductibles

From the NYT: “The Affordable Care Act was supposed to improve access to health insurance, and it did. It reduced the number of Americans who were uninsured through the Medicaid expansion and the creation of the health insurance marketplaces. Unfortunately, it has not done enough to protect people from rising out-of-pocket expenses in the form of deductibles, co-pays and co-insurance.

“Out-of-pocket expenses exist for a reason; people are less likely to spend their own money than an insurance company’s money, and these expenses are supposed to make patients stop and think before they get needless care. But this moral-hazard argument assumes that patients are rational consumers, and it assumes that cost-sharing in the form of deductibles and co-pays makes them better shoppers. Research shows this is not the case. Instead, extra costs result in patients not seeking any care, even if they need it.

“Cost-sharing isn’t set up in a thoughtful way such that it might steer people away from inefficient care toward efficient care. Deductibles are, frankly, ridiculous. The use of deductibles assumes that all medical spending is the same and that the system should disincentivize all of it, starting over each Jan. 1. There is no valid argument for why that should be. Flu season peaks in the winter. We were in an Omicron surge at the beginning of this year. Making that the time when people are most discouraged from getting care doesn’t make sense.

“Co-pays and co-insurance aren’t much better. They treat all patients the same, and they assume that all patients should be treated the same way. …

“The purpose of insurance is to protect people from financial ruin if they face unexpected medical expenses. Reducing the amount that they need to pay from six figures to five is necessary, but not sufficient. It’s not enough to give people insurance. That insurance must also be comprehensive.”

The case for Bidencare

Paul Krugman in the NYT: “But while Biden is indeed proposing incremental change rather than Medicare for All, we’re talking about some big increments. Independent estimates suggest that under Biden’s plan, 15 million to 20 million Americans would gain health insurance. And premiums would fall sharply, especially for middle-class families. …

“None of this [Biden’s proposals] amounts to revolutionary change — in contrast to Trump’s efforts to kill Obamacare, which would drastically change American health care, for the worse. But Bidencare would still be, as Biden didn’t quite say when President Barack Obama signed the A.C.A. into law, a pretty big deal.

“True, America would still fall somewhat short of achieving what every other advanced country has — universal health care. But we’d get a lot closer, and many who currently have insurance coverage would see their costs fall and the quality of coverage improve.”

The Swedish approach to Corvid-19 revisited

From the NYT: “Normalcy has never been more contentious than in Sweden. Almost alone in the Western world, the Swedes refused to impose a coronavirus lockdown last spring, as the country’s leading health officials argued that limited restrictions were sufficient and would better protect against economic collapse.

“It was an approach that transformed Sweden into an unlikely ideological lightning rod. Many scientists blamed it for a spike in deaths, even as many libertarians critical of lockdowns portrayed Sweden as a model. During a recent Senate hearing in Washington, Dr. Anthony S. Fauci, the leading U.S. infectious disease specialist, and Senator Rand Paul, Republican of Kentucky, angrily clashed over Sweden.

“For their part, the Swedes admit to making some mistakes, particularly in nursing homes, where the death toll was staggering. Indeed, comparative analyses show that Sweden’s death rate at the height of the pandemic in the spring far surpassed the rates in neighboring countries and was more protracted. (Others point out that Sweden’s overall death rate is comparable to that of the United States.)

“Now, though, the question is whether the country’s current low caseload, compared with sharp increases elsewhere, shows that it has found a sustainable balance, something that all Western countries are seeking eight months into the pandemic — or whether the recent numbers are just a temporary aberration.”

Maybe the individual mandate wasn’t so crucial

From the NYT: “Many experts now view the individual mandate as a policy that did little to increase health coverage — but did a lot to invite political backlash and legal challenges.

“The newest evidence comes from census data released Tuesday, which shows health coverage in the United States held relatively steady in 2019, even though Congress’s repeal of the mandate penalties took effect that year. …

“Obamacare’s insurance subsidies, via tax credits, brought more stability to the marketplace than originally expected. The credits are structured to keep premiums affordable for low- and middle-income Americans even when the base price of insurance rises. The vast majority of Obamacare enrollees — between 80 percent and 90 percent, depending on the year — buy their coverage with these credits.

“It’s also possible the mandate did have some effect during its brief life in making the purchase of health insurance more of a norm. When the Kaiser Family Foundation surveyed the public on the issue in 2018, it found that only half of respondents knew the penalties had been repealed. The mandate penalty may live on in Americans’ minds, even after Congress wiped it off the books.’