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Recent Developments in Health Law: The Bush Administration's Health Care Proposal: The Proper Establishment of a Consumer-Driven Health Care Regime

Benjamin P. Falit In his State of the Union address on January 31, 2006, President George W. Bush asserted: “for all Americans, we must confront the rising cost of care, strengthen the doctor-patient relationship, and help people afford the insurance coverage they need.” Soon thereafter, the White House National Economic Council released a summary of President Bush’s plans for health care reform.1 The Bush plan argues that increased consumer control over health care purchasing decisions will go a long way to solving America’s health care woes. By making patients more value-conscious consumers, the Bush Administration hopes to reduce costs, improve quality and increase competition within the health care sector. The problem of rising health care costs is not new. In fact, President Bush’s statement could have come from any American President in the last fifty years. Consider, for example, former President Jimmy Carter’s comments on the “health care crisis” in his 1979 State of the Union Address: “We must act now to protect all Americans from health care costs that are rising $1 million per hour, 24 hours a day, doubling every 5 years. We must take control of the largest contributor to that inflation: skyrocketing hospital costs.”2 National health care expenditures as a percentage of GDP have been steadily climbing since the 1960s, and there is no indication that they will level off in the near future.3 Even after adjusting for inflation, the average cost of an employer-provided, family health insurance plan has increased from just over $6,000 per year in 1999 to almost $11,000 per year in 2005.4 More than one-quarter of adults report problems paying medical bills, and over sixty percent of those reporting problems have health insurance.5 Each year, nearly 750,000 American families, a number that represents a twenty-fold increase in filings over the last two decades, file for bankruptcy because of a major illness.6 The financial pressures created by medical inflation may have contributed to policymakers ignoring an arguably more important issue: the quality of health care services.7 Although the United States spends more per capita on health care than any other country, Americans’ health status lags far behind that of other nations.8 Out of thirteen comparably industrialized countries, the United States ranks an average of twelfth on sixteen well-accepted health indicators such as years of potential life lost and age-adjusted mortality.9 The World Health Organization (WHO) has developed a measure entitled “performance on the level of health,” which reports “how efficiently health systems translate expenditure[s] into health as measured by disabilityadjusted life expectancy.”10 According to the report released by the WHO in 2000, the United States ranks 72nd in the world on this index.11