I agree and also disagree with such assessment. It is completely true that our bureaucratic medical system could use better management like I have mentioned in prior posts, but our health care problems are complicated - they result from many types of problems, managerial being only one of many. I'd like to argue that another big cause of our soaring medical expenses is the price tags - it is not managerial, we can fix it with a master plan which the House bill has put forward (i.e. the public option), and it is one of the low-hanging fruits that we can easily reach, much more easily than systematic improvement which will take decades.
Consider how much we pay for a pill of medication - I'm going to use Misoprostol manufactured by Pfizer (aka Cytotec) because I do have first hand information on the pricing of this medication. In Thailand, a pill of Cytotec costs 13baht - that is about 30cents with the current exchange rate. According to Epocrates, 60 pills of 100mcg Cytotec costs $72.76 ($1.213/pill), 60 pills of 200mcg Cytotec costs $104.99 ($1.75/pill). That is 4x-8x what people pay in Thailand.
Now consider a can of coke - one in Thailand costs 14 Baht (40 cents), one in the US reasonably costs 1 dollar. I'd like to argue that even taking into account the difference in costs of living (~2x), there is a huge price discrimination at play when in comes to medication pricing. In the US, with our one limited example, it seems that we are paying 2x-6x more than other countries. Could that be a reason why our health care costs so much more than the rest of the world? Is that why pharmaceutical companies make fat profit in times of economic downturn, even fatter than that of insurance companies?
If pricing contributes to the equation, then the public option will amass bargaining power that will lower the price of medical supplies. Allowing Medicare to bargain will also help. Private insurance companies will follow suit due to competition. The public option could be the master plan that quickly reduces costs, while the also necessary managerial improvement takes place over time.
Another point that both doctors and patients must realize is that health is an amalgamation of many factors, medicine being at the end of the spectrum. Most patients get to their doctors when the body is already broken, many times beyond salvage. A morbidly obese patient carrying a heart clogged with fat since the age of 14 cannot be saved by the best doctors or the best health care system - he is most likely destined for a short and unhealthy life. Fixing the medical system will not completely fix our health - we also need to pay attention to socio-economic stability, public health measures, education.
But a successful health care reform will, of course, also be helpful.