Health Care Reform

http://http://knowledge.wharton.upenn.edu/article.cfm?articleid=2457

OK. So, what's in the new health care bill? We know that it's 2400 pages. This probably makes it good for weight training but difficult to summarize, understand or administer.

Mark Pauly, a Wharton professor of health care systems, points out that there is uncertainty even about what's in the bill. The "reform" calls for a number of changes but doesn't explain exactly how those changes will be made. The legislation reportedly falls back on the phrase, "The secretary shall," more than 1,000 times. This means that Congress has turned it over to the Department of Health and Human Services to figure out "how" to make it happen. Are we worried yet?

Loose ends include details of the high-risk pool option, which the government is supposed to create within 90 days of the bill's passage. Per Pauly, "Nobody knows how that's going to work. The only thing we know is that they're going to put $5 billion into it."

The bill's emphasis on "community rating" is another component that could backfire. Community rating is when insurance companies offer the same premium to everyone in the community, regardless of age or health. Politicians often claim that community rating will lower the costs to high risk individuals but they often leave out the flip side of the equation - that insurance companies will probably respond by raising premiums for everyone else.

Wharton mangement professor Lawrence Hrebiniak is less concerned with the legislation's potential administartive problems than he is with the big picture: "The bill is terribly complex and opaque, but it is only one source of problematic complexity facing decision makers in Washington ... The health care overhaul suggests to me that the country lacks the management talent to handle the mounting problems facing the nation."

The K@W article we've attached is a decent summary early in the game of what 2400 pages can imply. It's attached for your perspective.