Media Note: Professor Jost discussed his book on NPR affiliate WMRA's Insight program on Wednesday, August 15, from 3 to 4pm. WMRA is heard in the Lexington area at 89.9FM and 90.7FM. Listen to the program.
Recent studies of health care in the Unites States have revealed that as many as 45 million Americans live without health insurance. This crisis has emerged as perhaps the chief domestic policy initiative for the 2008 presidential elections. The Kaiser Family Foundation, a private foundation focused on the major health care issues facing the U.S., has even set up a special web site at health08.org to help focus attention on this issue by providing information on the Republican and Democratic candidates' plans for universal health care.
In his new book, Health Care at Risk, W&L law professor and health care expert Tim Jost enters this critical debate by examining one of the latest developments in health care, the consumer-driven movement. Jost's thorough and data-driven analysis of the solutions proposed by consumer-driven advocates reveals serious short-comings in the ability of their proposals to provide adequate care, even as consumer-driven health care has gained tremendous momentum as a health care panacea.
Advocates of the consumer-driven movement believe that health care costs are skyrocketing because our insurance-based system provides so many services at little or no cost to the consumer, allowing unlimited consumption of those services. The solution they propose to this problem of "moral hazard" is to implement a health care system where most health expenses are borne out-of-pocket by the consumer, encouraging them to use only those health care services of real value to them. Consumers would pay for these costs using tax free health savings accounts, coupled with high deductible insurance plans.
"This approach does lower health care costs," says Jost, "but it is rather a blunt instrument for achieving that goal as it results in a lower quality of care for lower-income Americans. For many Americans, even those living several times above the poverty level, out-of-pocket health care costs amount to an unsustainably high proportion of family income. This often has devastating consequences in terms of access to health care and family finances."
Jost also faults the consumer-driven movement for viewing health care like any other consumer expense rather than the complex system of analysis and consultation that it is. Far from empowering users, Jost says that because these plans do little to educate consumers about the pricing or quality of health care providers, consumers are unable to distinguish between essential and nonessential services. That, coupled with cost, often results in consumers choosing to opt out of health care all together.
"If high cost sharing also leads to worse health care outcomes or to financial catastrophe for many Americans, we have not made an advance in health policy," says Jost.
Jost concludes his book by proposing a bold solution to the crisis based on his detailed analysis of health care systems in place in the Unites States and around the world. Jost believes the primary cause of the health care crisis is not moral hazard but the ability of people to afford care. Jost's plan divides health care into three areas: catastrophic care, acute care, and preventive care. Catastrophic care, for the highest cost procedures like organ transplants, and preventative care, which if neglected results in higher health expenditure later in life, should be covered completely by government plans. The insurance market would then compete with a third government plan to cover all other acute services, and because the highest costs procedures would not be a factor anymore, health insurance costs in general would be lower.
"The basic responsibility for the cost of health care, and particularly high cost health care, must be bourn by the community as a whole, which means it must be financed in part through taxes," says Jost. "This is the way most other developed countries do it, and although every health care system has problems, most are doing better than we are."
Health Care at Risk: A Critique of the Consumer-Driven Movement is available now from Duke University Press.
Tim Jost is the Robert L. Willet Family Professor of Law and Alumni Faculty Fellow at the Washington and Lee University School of Law. He is also the author of Health Care Coverage Determinations: An International Comparative Study and Disentitlement?: The Threats Facing Our Public Health-Care Programs and a Rights-Based Response. He serves on the health policy advisory team for ABC news.
For more information, visit his faculty web page.