Paul Krugman’s take on the health care industry’s (aka “medical-industrial complex”) announcement that they will find ways to cut $2 trillion from their costs over the next 10 years is informative. Krugman is, in my view, the best liberal bellwether at assessing the administration’s economic and health care policy decisions. While Krugman identifies a number of area of concerns in the announcement from the medical-industrail complex, he’s overall positive and optimistic. When Krugman says the announcement is “some of the best policy news I’ve heard in a long time,” it’s certainly heartening.

What concerns me is what the medical-industrial complex believes these concessions will enable them to push for with the administration. Do they expect the media and the administration to believe this move has necessitated they get a seat at the bargaining table? Will they use the good will they’ve earned to fight against a public health care option in the reform package? Would they embrace any form oversight into whether or not they’re succeeding in cutting their promised 1.5% over the next 10 years? While this isn’t something the administration is saying they’ll do, you have to imagine that at some point a voluntary course of action will not be sufficient to ensure the kinds of cost controls necessary to allow adequate reduction in delivery costs for true health care reform.

I’m not a health care policy expert, but I hope that Krugman’s analysis holds. From a political standpoint – and a long-term policy standpoint – it worries me that any concession from the medical-industrial complex will be met by an imperative for Democrats and reformers to diminish the scope of their goals for change.

Update:

Jonathan Cohn of TNR, who is probably the most knowledgeable liberal health care reporter, has a similar take to Krugman.