In 1941 the US Senate formed a committee to address waste, inefficiency and profiteering in war production. Chaired by Harry Truman, the committee was extraordinarily successful and launched Truman on to the presidency. Today the country is in another war involving waste, inefficiency and profiteering by private sector enterprises — but this time in healthcare.
Governments in the US this year will shower $1.3 trillion on hospitals, nurses, doctors, pharmaceutical companies, medical device makers and other healthcare enterprises. The returns aren’t good:
California alone will spend $103 billion on Medicaid in its next fiscal year. That’s more than double the spending of just seven years ago. Nurses, doctors, hospitals, device makers and pharmaceutical companies are $52 billion per year richer but are Californians healthier as a result? The evidence isn’t good. Emergency room visits are up and some studies indicate some patients are better off uninsured than on Medicaid. What’s going on? I’m guessing political cronyism is behind much of it.
Greater coverage doesn’t always mean greater health — but it almost always means greater revenue for healthcare cronies.
Most politicians talk about greater health care insurance coverage but what ultimately matters is greater health. The distinction matters because healthcare enterprises are the financial beneficiaries of greater coverage. They have been extremely successful in encouraging politicians to expand coverage while not being accountable for outcomes. Not surprisingly, the net result is more spending but not necessarily better health. Still, some politicians propose even more government spending or authority in their favor. Those politicians are more likely than not on the receiving end of endorsements and/or financial contributions from enterprises who benefit from more spending. Because political activity by those that feed at the state trough is not banned, citizens should always be skeptical of politicians who propose more spending on them.
Spending by governments on healthcare already exceeds spending on every other government priority. Crowded out are vital public services such as education, courts and research and development. A fix from Washington, D.C. doesn’t seem likely given the healthcare-provider lobby is among the most powerful walking the halls of Congress and the latest Secretary of Health and Human Services is a doctor who took their donations while in Congress. But signs point to HHS allowing states to follow more of their own path. California should form its own Truman Committee to get better health out of all that healthcare spending. The stakes for citizens are huge:
As one example, just a 10 percent reduction in healthcare spending out of the state General Fund could produce a 100 percent increase in spending on a Judicial Branch that hasn’t seen growth in a decade.
A politician advocating for more government spending on healthcare providers is often just a shill for cronies in search of more revenue.
Doctors, nurses, hospitals, medical device makers and pharmaceutical companies provide wonderful services but they are also commercial interests seeking to maximize revenues by influencing politicians. More government spending on health care means less spending on other programs, higher taxes and fees, or both. No issue has a greater impact on Californians. Surely some politicians have noticed that the Truman Committee launched Harry Truman’s ascendancy to the presidency. Someone needs to step up. We need to get value for those billions.