Dean Baker: Good Medicine - Why Not for Everyone?

As part of his health care package, President Obama proposed creating an independent commission of medical experts that would determine the medical procedures for which Medicare will pay. The reason is that patients now receive many costly procedures that provide little or no medical benefit. If we can reduce this waste, we can have large savings, while possibly even improving health outcomes. President Obama describes this as promoting good medicine.

He has a case, but there is one problem with this picture. If the plan is to promote good medicine, why are we just doing it for the elderly receiving Medicare? Why don't we want good medicine for everyone?

Specifically, the government could apply the experts' judgments on appropriate procedures to any insurance plan that receives government support. This would mean that any plan that enrolls patients with government subsidies would be bound by the expert panel's judgment. If we are confident that our experts will be acting based on sound medical evidence, why shouldn't their assessment apply everywhere?

In addition to the "why not" question, there is also a very important reason why we should want everyone else to be treated like Medicare beneficiaries: quality assurance. There is a disturbing tendency among our Washington elites to treat seniors as a species apart. For example, people who complain about high tax rates on the wealthy have no trouble proposing means-testing schemes for Social Security and Medicare that would impose far higher effective tax rates on middle income retirees.

If the same rules for medical procedures were applied to everyone as to the elderly, it would be far less likely that genuinely useful procedures would be excluded from coverage just to save the government a few dollars. With far more eyes on the process, and far more interested parties, we could have much greater confidence that the panel's decisions were really based on sound evidence.

This raises another important issue about these sorts of medical panels: conflicts of interest. Top medical researchers have a bad habit of taking large consulting fees from folks like pharmaceutical companies, medical supply companies and insurance companies. In many cases, they even hold stakes in these companies.

These medical experts are undoubtedly all very honorable people. However, it simply is not fair to ask the public to trust the health of their loved ones to a medical expert who got a $50,000 check from a company that stands to profit or lose large sums of money depending on their decision.

Any panel must come with strict conflict-of-interest guidelines. For example, something like a complete ban, for at least the prior five years, on any fees from any company directly impacted by the panel's decision would be a good start.

Of course, strict conflict of interest rules would make it difficult to put together a panel of experts, since virtually all of our top medical researchers routinely accept fees of various sorts from companies in the health sector. The solution might be to put less compromised foreign researchers on these panels until we can produce a crop of domestic researchers with more integrity.

But if the choice is between no panel or a panel comprised of people on the payroll of the drug companies and their ilk, then no panel would be the better outcome. The fact that putting together a conflict-free panel is actually a problem is a testament to the corruption of our health care system. In the country as large as the United States, there should not be any difficulty finding top experts who survive on their salary as a researcher. The vast majority of us survive on considerably less money.

There is one other point about this process that should be beaten back with a sledgehammer. Nothing in this picture has anything to do with rationing. The question here is what procedures government-subsidized insurance will cover. Everyone in the country is free to buy nongovernment-subsidized insurance or pay for any procedure they want out of their own pocket. In that respect, the system is just like the one we have now: If you can afford it, you can get it. Those shrieking about "rationing" are just using scare words to avoid a real debate.

In short, President Obama's plan to weed out ineffective and wasteful medical procedures is a good one. But we should not single out Medicare beneficiaries as guinea pigs in this adventure, and definitely must ensure that the people to whom we entrust our health are not on the industry payroll.

More From This Author »

Dean Baker is the Co-director of the Center for Economic and Policy Research. CEPR's Jobs Byte is published each month upon release of the Bureau of Labor Statistics' employment report.

© Scoop Media