Howard Dean: GOP Has 'No Idea' How Healthcare Works

Former presidential candidate and Vermont Gov. Howard Dean said in New Hampshire Monday that while he didn't support the Affordable Care Act, there is reason to believe that the country can make it work.

Dean, who ran for the White House in 2004, appeared at St. Anselm College in Manchester as part of a lecture series at the New Hampshire Institute of Politics. 

Speaking to an audience of close to 120 people, he didn't waste time before taking his licks at Republicans.

"The assumptions that are made about the economics of health care basically are wrong, particularly on the Republican side, Dean said. "They simply have no idea how health care works. 

"They keep talking about market-based reforms. The problem with market-based reforms is that in health care, competition drives prices up, not down. And in health care, the entire reimbursement system and the entire incentive system, unlike everything else in capitalism, drives us to spend as much as we possibly can, it doesn't drive prices down."

Dean called the health care plan designed by U.S. Rep. Paul Ryan "unpopular" and "silly" due to the notion of transferring the risk from the payer to the patient.

According to Dean, the Affordable Care Act isn't without unintended impacts, although he still believes the bill has the opportunity to transform health care.

He discussed the development of the ACO, or Accountable Care Organization, which he said vertically integrates health care with one company or one structure, which operates differently based on the state laws.

"In one company, you have the same person who operates on your heart and who cuts your grandmother's toenails in the nursing home, all working for one company or one big contractual organization."

Dean explained that vertically integrated companies were put in the bill for quality assurance, which he called a sensible thing to do, but the unintended consequence is that the ACO doesn't need an insurance company and doesn't need to charge people fee for service.

He noted that companies like Kaiser will tackle risk factors for future health problems when they are young, rather than pay for the more expensive care when the patient is older.

"The ACO can potentially change our system from an illness-based system to a wellness system, and it can give the hospital providers an incentive to compete directly with insurance companies, in other words get rid of insurance companies," Dean said.

Dean also explained that while patients "don't make good decisions buying health care, they "do make good decisions buying insurance."

He said that if Ryan's plan had shifted the burden from payer to provider, offering a global budget to each payer for their procedures, the risk is shifted.

"Again, you do have to have regulation because people will cheat and they will under service people, but people cheat in every system."

Dean also criticized New Hampshire's lack of a competitive marketplace in the health care industry. He called the issue a "state government mistake" that has nothing to do with ObamaCare.

Dean's home state of Vermont also faces one provider on the ACO, which he said will require a lot more regulation. 

He noted that due to Republican political influence, an exchange of 33 states has been created that will make for a big challenge for the Obama administration.

Dean closed his speech by keeping after the GOP, specifically former presidential candidate and current Texas Gov. Rick Perry (R) Perry was scrutinized for what Dean called the lack of health care provided to both adults and children.

"I haven't once heard him say that 22 percent of all the children in Texas have no health insurance under Rick Perry and 25 percent of the adults have no health insurance. This is a third world country in terms of their respect for the people who make that economy as great as it is. Those Texas kids are American kids and that's our business, too. They are entitled to the same type of health care that they have in Vermont."

Dean gave no mention to the possibility of a 2016 presidential run during his speech. He told an Idaho paper in August that he is putting his support behind Democratic party favorite Hillary Clinton.