Policy-ish

Wall Street Comes To Washington, And, Gasp, Health Care Consensus Ensues

Financial and health policy analysts who gathered for the 15th annual Wall Street Comes to Washington Conference reached a surprising meeting of the minds on the new health care law.

They nearly all said it will do a good job getting people more insurance coverage, and a not-so-good job addressing the high cost of health care.

"Most of us agree this measure will probably boost the insured population and you could probably give it an A," said Charles Boorady, a Managing Director with Credit Suisse, at the conference sponsored by the Center for Studying Health System Change. "But I think it gets an F on bending the cost curve up instead of down." The U.S. spends 17 percent of gross domestic product on health care, compared with France and Switzerland, the next in line, at about 12 percent. "No one's demonstrated to me that our outcomes are better," Boorady said.

By failing to rein in the percentage of our economy devoted to health care, the health law doesn't address the threat to the nation's productivity "That's money that comes out of employers; that's money that could go into education, infrastructure, or more productive use," he said.

But Gail Wilensky, former head of Medicare under the first President Bush and a health economist at Project Hope, said she "just absolutely disagrees" with Boorady's contention about health care hurting the the nation's productivity.

"This has been an incredibly productive sector," Wilensky said, and preserving that contribution while slowing spending growth is a real challenge. "We're going to have to do it with a very light touch," she said, because health care is only one of two sectors that has added jobs in recent years.

Wilensky has a point. The Bureau of Labor Statistics says 4 of the top 10 industries with the largest wage and salary employment growth projected from through 2018 are in health care.

From July to August, the health sector added by far the most jobs, up 28,000.

All of which helps explain why Congress wasn't all that keen on doing much in the new law to address costs. Yes, the nation is spending an awful lot on health care without getting a ton of value in return.

But that money is someone's income. And cutting income often means cutting someone's job. And in these tough times, that's not pleasant political work.

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