Monday, October 15, 2007

Hillary Clinton's Learning Curve

On most issues, you can line up Hillary Clinton on one side and the Bush administration, free-market think tanks and conservative economists on the other. It would be a surprise to find the former first lady lifting ideas from her longtime opponents. But in this case, there is not one surprise but two: She's not only doing it, but she's doing it on health insurance, where she once embodied Big Government.

The chief question before the country right now is what to do about the 47 million people in the United States who lack health insurance. Their being uninsured is regrettable because it prevents them from getting adequate care and forces the rest of us to shoulder the cost when they get sick. Not only that, it causes anxiety among the insured, who worry about losing coverage. The magnitude of the problem is such that this year, the presidential candidates have been forced to come up with plans to assure everyone, or almost everyone, will be covered.

For years, many conservative experts have proposed a way: making health insurance more affordable by changing how it's treated in the tax code. In this year's State of the Union address, President Bush urged that individuals who buy medical insurance get the same tax break that businesses get when they purchase policies for their workers. In his plan, any family that obtains private coverage would get a $15,000 tax deduction.

But more is required to expand coverage among low-income Americans. Since they pay little or nothing in income taxes, the deduction wouldn't help them much. So the president's plan would provide them a "refundable" tax credit -- a fancy way of saying that if they don't owe taxes, they would get money to buy health insurance. It amounts to a federal voucher for medical coverage.

Bush's solution certainly appeals to his ideological allies. His former chief economic adviser, Harvard professor Gregory Mankiw, has praised the concept. So has Tyler Cowen, a George Mason University economist affiliated with the libertarian Cato Institute. David Gratzer, a physician at the conservative Manhattan Institute, raised the idea in an article for National Review Online.

The case has been neatly summarized by Nina Owcharenko, a policy analyst at the Heritage Foundation who says approaches like this have a host of conservative virtues. "Instead of building on bureaucratic structures or relying on outmoded welfare programs," she writes, "they can promote personal choice in health plans and benefits by transferring decisionmaking power in the health care system to individuals and families."

The change would also make a huge difference. Mark Pauly, a health care economist at the University of Pennsylvania's Wharton School, says that with a credit of $2,000 per person, "I'd guarantee a 50 percent reduction in the number of uninsured." A larger subsidy could boost that figure to 85 percent.

Part of the value of this strategy is that it would vastly expand the individual insurance sector, which now performs poorly because it is so small, has such high overhead expenses and attracts so many high-risk individuals. Arming millions of healthy people with tax credits, Pauly ventures, would be a potent stimulus to competition and efficiency in the private market.

This is not a goal of those who favor government-run health care. So you wouldn't expect Hillary Clinton to embrace the idea. But her new plan says, "Working families will receive a refundable tax credit to help them afford high-quality health coverage." (How big, she doesn't say.)

Is that a change? Well, back in 1993, when we got the original version of HillaryCare, it was opposed by a coalition called Citizens Against Rationing Health, whose alternative plan included -- what's this? -- a refundable tax credit for the poor.

This is not to say that Clinton has joined the Milton Friedman fan club. Her program is still heavy on the kind of intrusive government dictates she has always found so alluring. It would fine large employers that fail to provide coverage for their workers, force insurance companies to offer policies to everyone, with no "excessive premiums," and order pharmaceutical manufacturers to sell drugs at "fair prices." It would force private insurers to compete with a government-sponsored program that could be priced at a loss to put them out of business.

When it comes to health care, Clinton has a long way to go. But conservatives can hope that she has only begun to learn from them.


British government doctor training policy diagnosed a failure

Changes to medical training introduced since 2002 have been rushed, poorly led and implemented and are unlikely even to produce very good doctors, according to a new report. Sir John Tooke, who chaired an independent inquiry set up by the Department of Health, said it had been a sorry episode from which nobody emerged with credit.

The new policy, called Modernising Medical Careers (MMC), was introduced without clear definition of what it was meant to achieve. Weak development, implementation and governance had made it worse. "Put simply, `good enough' is not good enough," Sir John writes. "Rather, in the interest of the health and wealth of the nation, we should aspire to excellence."

Problems with MMC first became apparent when the computer-based application system used for selecting doctors for higher training failed this year. The Medical Training Application Service (MTAS) had to be abandoned, and the furore about it drew attention to wider defects. The report by Sir John, who is Dean of the Peninsula College of Medicine, will make uncomfortable reading for the department, and for Sir Liam Donaldson, the Chief Medical Officer, who was the main driving force behind MMC.

Sir John refused to name those directly responsible for the debacle. "The medical profession itself was complicit in MMC, and it is hard to target any individual for responsibility," he said. The policy had failed in its key aim, which was to eliminate the "lost tribe" of senior house officers who did most of the work in NHS hospitals but were regularly denied opportunities to train to become consultants.

When MMC came in, such doctors found that they had to compete with the growing output from British medical schools and doctors from abroad allowed to work in Britain. Despite repeated warnings, the department at first ignored the problem, and its plan to introduce a policy whereby doctors' jobs only went to overseas candidates if there was not a suitable home applicant was stymied in the courts. This meant that 8,352 foreign doctors were free to apply for posts in 2007, along with 1,500 from the EU and 11,994 British citizens.

While acknowledging the "fantastic contribution" made to the NHS by foreign doctors, Sir John said it was not sensible to have a policy which allowed them to compete with doctors trained in Britain at a cost each of o200,000 to o250,000. The department moved to rectify the situation yesterday by announcing a consultation to look at proposals for managing overseas applicants in the future.

Sir John's report suggests that all those successful in getting a place in a medical school should be guaranteed a training place for the year after they graduate. At present, under MMC, this is not guaranteed - which means medical graduates cannot call themselves doctor, or even work as doctors.

He also suggests that the Postgraduate Medical Education and Training Board should be incorporated into the General Medical Council, which is already responsible for the undergraduate curriculum and for registering doctors. "The management of postgraduate training is currently hampered by unclear principles, a weak contractual base, a lack of cohesion, a fragmented structure and, in England, deficient relationships with academia and service," the report said.

Andrew Lansley, the Shadow Health Secretary, said that it laid bare "the shameful mismanagement by the Government of junior doctors' training. Hundreds of junior doctors still need action taken to ensure those who continue to meet the necessary standards will have the training [made] available to them." Ben Bradshaw, the Health Minister, said that the Government had learnt important lessons from MMC and would consider the report fully.


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