Why Health Care Reform May Work This Time
The cost of health care has risen at several times the inflation rate with increases of 7.9% in 2008, a year of near deflation. The increased costs are weighing down bottom lines and provide a disincentive to expansion and hiring. Thus, businesses are much more keen to see an intervention than they were in 1994.
Dealing with the myriad rules and regulations of various insurance companies adds substantial transactions costs to health care services. I was struck by how few office workers were in the hospitals and doctors offices portrayed in Moore's movie Sicko. When my wife needed throat surgery, I remember thinking why would a small Ear, Nose and Throat practice needed so many office personnel. Obviously, it's due to the third party payer system. No doubt, the key employee was the one who knew all the different insurance companies' intricate rules for reimbursement. She would be the one who made sure her office got paid. A national system with one set of rules would greatly simplify the procedure and reduce overhead and other transactions costs.
And that's why I like our chances this time.











