Mind the PPACA gaps

Sally Pipes, the president of the Pacific Research Institute for Public Policy, has been one of the most visible players in the U.S. health finance policy fight for decades.

Sir Anthony Fisher, a British businessman, set up the institute and sister think tanks, including the Manhattan Institute, to publish analyses based on the principle that strengthening economic freedom helps increase personal and political freedom.

Pipes has fought against the health system change proposals promoted by Hillary Clinton in the early 1990s; a series of “single-payer” and employer “play or pay” proposals in California; and, in recent years, the Patient Protection and Affordable Care Act (PPACA).

An institute economist estimated in October 2010, for example, that defensive medicine adds $191 billion per year to U.S. health care costs.

So, what gets her op-ed juices flowing these days?

For three hot topics she talked about last week in an interview, read on.

1. Network gaps

This issue is dear to Pipes’ heart, because she grew up in the single-payer health care system in Canada.

Pipes believes the difficulties her own mother had with getting a referral for a colonoscopy may have affected the quality of care her mother received for what turned out to be fatal colon cancer.

Healthy people usually buy health coverage based on monthly premiums, not on network quality issues, Pipes said.

“They don’t think they’re going to get sick.”

Similarly, she said, when the government gets involved with health care finance, it may try to compensate for waste and inefficiency with misguided efforts to limit spending, such as caps on the percentage of gross domestic product that goes to pay for health care, or rigid efforts to keep hospitals from readmitting too many patients too often.

“That’s when you get shortages,” Pipes said.

When moderate-income people sign up for unrealistically low-premium exchange plans, or the government puts low-income people into poorly funded Medicaid programs, at some point, “they can’t find doctors,” Pipes said.

2. Health savings accounts (HSAs)

Pipes said she respects the views of free-market health system change advocates who say the country should do without Medicare, Medicaid, Social Security, and, possibly, even managed care organizations that pay providers directly as well as PPACA.

But she said also believed her mentor, Milton Friedman, when he told her, “We’re not going to get rid of Medicare,” and “We’re not going to get rid of Social Security.”

The solution is to expand the HSA program, and add similar programs, to get the health care market functioning as well as it can function, under the circumstances, Pipes said.

3. Numbers

Pipes said she would like to have numbers showing how PPACA is affecting consumers’ access to health care, and other statistics showing how PPACA is affecting the health care system, but that she’s increasingly skeptical of the numbers she sees.

She recalls, for example, the time President Obama said PPACA would save the average family $2,500 per year.

Then, the time, shortly after that, the Congressional Budget Office analysts estimate the average family would see costs rise about $2,100 per year under Obama.

Now, she said, she’s seen figures implying that costs may be about $4,600 higher per family per year.

She also cited the recent U.S. Department of Health and Human Services (HHS) projections showing that actual PPACA exchange system enrollment may fall to 9.1 million at the end of this year and increase to just 10 million next year.

A few years ago, she said, the CBO analysts were saying 21 million people would be using the exchange system.

She’s even more leery of trusting care access and quality data.

“It’s very difficult to measure quality,” Pipes said.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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