Romney praises health care in Israel, where research says ‘strong government influence’ has driven down costs
Posted by Sarah Kliff on July 30, 2012 at 11:10 am
Romney’s point about Israel’s success in controlling health care costs is spot on: Its health care system has seen health care costs grow much slower than other industrialized nations.
How it has gotten there, however, may not be to the Republican candidate’s liking: Israel regulates its health care system aggressively, requiring all residents to carry insurance and capping revenue for various parts of the country’s health care system.
Israel created a national health care system in 1995, largely funded through payroll and general tax revenue. The government provides all citizens with health insurance: They get to pick from one of four competing, nonprofit plans. Those insurance plans have to accept all customers—including people with pre-existing conditions—and provide residents with a broad set of government-mandated benefits.
Health insurance does not, however, cover every medical service. Dental and vision care, for example, fall outside of the standard government set of benefits. The majority of Israelis—81 percent —purchase a supplemental health insurance plan to “use the private health care system for services that may not be available in through the public system,” according to a paper by Health Affairs.
The national government exerts direct operational control over a large proportion of total health care expenditures, through a range of mechanisms, including caps on hospital revenue and national contracts with salaried physicians. The Ministry of Finance has been able to persuade the national government to agree to relatively small increases in the health care budget because the system has performed well, with a very high level of public satisfaction.
The Israeli Ministry of Finance controls about 40 percent of Israel’s health care expenditures through those payments to the four insurance plans. The ministry decides how much it will pay the health plans for each Israeli citizen they enroll, making adjustments for how old a person is and how high their health care costs are expected to be.
It’s then up to the health insurance plan to figure out how to provide coverage within that set budget. If they spend too much—have a patient who is constantly in the hospital, for example—they will find themselves in the red. It’s that set budget—a capitated budget, in health policy terms—that seems to be crucial to the Israeli health care system’s success in cost control.
The candidate Mitt Romney seems to be very inconsistent about health care. He praises a government run medical care system far more strict and less free market and yet he attacks the Affordable Health Care Act. The attacks are based upon erroneous, fabricated, and politically motivated arguments without merit. Mr. Romney asserts that the act; “puts the government between you and your doctor”, however his political campaign personnel cannot explain how. Nor can he.
The information below in part comes from PolitiFact.com
The overarching fact about the law is that it relies on the private sector. Employers still buy private health insurance for their workers. The law doesn’t change how much doctors are paid or what services they can provide, though it does create incentives and penalties to promote better care. (One example: It penalizes hospitals if patients are re-admitted soon after being discharged.)
It establishes a minimum benefits package for insurance plans and fosters competition among health insurance companies by creating shopping websites. These sites, called exchanges, will allow customers to pick insurance plans the same way they might buy other things online, such as refrigerators or airplane tickets.The law also gives subsidies to people of limited means so they can buy their own insurance.
The law sets up a panel to keep Medicare spending in check. The 15-member panel is called the Independent Payment Advisory Board and starting in 2020, it can recommend changes in reimbursement rates and other cost-saving measures. Health reform law opponents sometimes speak of this panel as a backdoor to rationing, but as PolitiFact has noted many times, claims about the IPAB are often exaggerated.
The law specifically prohibits the panel from suggesting anything that leads to rationing or reductions in either benefits or eligibility. Further, Congress has the power to overrule the panel’s recommendations.
The law is sweeping and is designed to have an effect on the quality and cost of care. But to assume that the outcomes will only be negative requires a very selective reading of federal law that overlooks many checks on federal authority.
First, Washington has given states the authority to set the standards for insurance plans so they can respond to local conditions.
Second, the law calls for creation of “strategies to align public and private payers with regard to quality and patient safety efforts,” and insurance company participation in those exchanges is part of that effort. But the law also expressly allows insurance plans to operate outside the exchanges.
Third, the strongest federal efforts to control spending lie in the federal Medicare program, not in the private market. Within Medicare, participation in the biggest cost-saving pilot — Accountable Care Organizations — is voluntary. The Accountable Care Organizations are intended to bring doctors and specialists together to treat patients and include financial incentives.
Fourth, all regulations must pass through an extensive public review process.
The individual mandate is something that many Americans don’t like. However, our costs of health care in this country is rising and it is expected to rise another 5%. People do have the right to refuse health insurance but, does the public and health insurance companies have the right to refuse to pay the “intended costs” because someone refuses health insurance, ” NO “ all patients are required to be treated in hospitals. The cost or “Tax” to those individuals is $750.00 for those over 18 and $375.00 for those under 18. The tax itself does not come close to the cost of hospitalization. The market place and the insurance exchanges will aid in the management of those insurance costs.
The Affordable Health Care Act is by far a less government run program than the GOP would have you believe. But, my question is for Romney, how does he square his belief with Israeli Medical Health Care system with his attacks on the Affordable Health Care Act.