Sure a well conceived and executed SP system is hard. What's your point?
That now would be the time for someone to seriously start working on one. No more gimmicks, no more hand-waving, no more conversation pieces. Time to tackle the hard questions if this is going to be a serious option. And that means acknowledging the tradeoffs.
Second, though cost inflation over time is indeed a thing, you can bet your ass both that SP would cost less per capita and that the cost curve would be more flat and gradual than the status quo alternative.
This is an article of faith, which I assume stems from the conviction that we can always rely on price controls to tamp down rising costs if necessary.
If Paul Ryan were to tell you we can hold down "costs" by indexing Medicaid block grants or Medicare premium support contributions to rise more slowly than we'd normally expect medical inflation to increase, you would (presumably) be concerned that this is an unrealistic and artificial assumption, doesn't at all actually address the underlying cost drivers providers face, and quite possibly would harm Medicaid or Medicare beneficiaries in the long run.
The potential of SP to help actually tackle costs, not just set prices, is in the potential of the unified policy direction it provides to support payment and delivery system reforms that reshape provider incentives and indeed the economics of practicing medicine. And that's good! But, as I said, we're already doing that now, in many cases on a multi-payer basis, and it turns out that even as providers increasingly turn to tackling population health management and delivery system reform, consistently getting a handle on rising costs is hard. There's no magic wand (or administratively set fee schedule) that changes the underlying reality.
Indeed, a great excess of money is being spent to pad the pockets of providers and medical suppliers as opposed to serving the public interest.
In 2015, private insurers nationally paid $149B for retail sales of medical products (that includes drugs, DME, and non-DME). That was 4.6% of our total spending on health care. You can add in the $126B in out-of-pocket spending on those things, not all of which is attributable to the privately insured, to get up to 8.6% of health spending. Maybe SP slices into that, with social impacts TBD, and slides 3-4% from national health spending. That's decent and I suppose it at least partially sticks it to the villains you've identified, but I don't know that it's a game-changer.
The majority of our dollars (including those flowing through private insurers) are going to hospital and professional reimbursement. And yes, some of their input costs will be drugs and devices but I don't see how the SP entity lowers those input costs if it isn't buying the inputs for hospitals and physicians.
Meanwhile, the money saved on this, as you admitted, bloat, can go into covering more people, relieving the burden of expense from businesses for healthcare, improving the standard of living, flexibility entrepreneurship and efficiency of the work force since it no longer needs to worry about obtaining healthcare and remaining insured, to say nothing of the other myriad secondary benefits of having a healthier workforce:
You're mixing concepts here.
Who finances it (an employer directly vs. a payroll tax or employer levy or whatever the ultimate mechanism for funding is) is distinct from
what we're paying for.
When I say "bloat" I'm talking about the fact that we have many people, often well-paid, and many gleaming facilities in our health system, and we can theoretically achieve equivalent health outcomes if we got rid of some of those people (or maybe just slashed their pay) and closed some of those facilities to reduce the costs of having that capacity. But that's tricky, particularly on short time scales in which disruption instead of evolution is demanded.
Perhaps people where you live are very different from those where I live, but I've seen how communities react when you try to close a freestanding ER facility (much less an entire acute care hospital), with the requisite layoffs, to cut costs.
They get pissed. They don't celebrate the newfound efficiencies and the freedom from the crushing burden of paying to employ their friends and neighbors, in quite the way your previous posts seem to assume they might.
And note this is in complete contradistinction to your argument that everyone's simply going to have more of everything. "Savings" may mean we need to have lower staffing ratios, fewer beds, fewer or no low-or-negative margin services, etc. It's not all roses, particularly for patient populations accustomed to getting the finer things in life.
