TightWind is written by Kyle Baxter. Stay Hungry. Stay Foolish.

Bryan Dowd:

Health plans and health care providers are likely to prefer Mr. Emmanuel’s approach because it is relatively easy for them to control centralized political decisions as opposed to the disaggregated, price-sensitive decisions made by millions of individual consumers. As an example of the former, consider Congressional attempts to rein in Medicare spending on physician services through the Sustainable Growth Rate (SGR) legislation. Under pressure from physicians, Congress repeatedly has ignored its own legislative mandate to cut physician fees over the past decade. The “law of the land” now requires Medicare physician fees to be cut by nearly thirty percent. I will leave it to the reader to decide whether it is more appropriate to apply Mr. Orszag’s “tooth fairy” analogy to the likelihood of that fee cut or the effects that would result from more price-sensitive consumers.