What’s different about health care?
The overwhelming majority of Americans are not Communists. In general, we believe that a free-ish market is a better way to organize the production and distribution of goods and services than government departments. But an awful lot of Americans seem to want government-run health care. Why? What makes health care so different from the rest of the economy that many of us want to turn it over to the people who brought us the Postal Service and the Department of Motor Vehicles?
Is it because health care is a necessity? Food is a necessity, but no mainstream politicians are pushing plans for tax-funded universal distribution of cheezburgers.
Is it because health care is expensive? Housing is expensive, and it’s a necessity, so why is nobody promising me socialized apartments?
Is it because we’re not happy with the health care the market is providing us with? I doubt that, too. I work for Microsoft, and everybody’s got tons of complaints about our products, but nobody wants to replace us with Federal Windows and Federal Internet Explorer.
Is it because other first-world countries have socialized medicine? If Canada jumped off a bridge, would you jump off, too? Besides which, other first-world countries really don’t have socialized medicine. Britain and Canada may have true socialized medicine, but Switzerland and the Netherlands only have mandatory private insurance programs, and France and Germany have health care systems which are more market-oriented than America’s current health care system (which includes Medicare, Medicaid, and a tax system which heavily subsidizes full-service employer-provided health insurance).
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I think Americans are looking north and going “damn, say what? The Canadians are getting marginally better care than we are and paying 2/3 of what we are?” It’s a powerful argument. Basically, if Canada jumped off a bridge and landed in _candy_, and then everyone else who jumped off the bridge also landed in candy, we’d be fools to stand around and not jump…
Wow was that metaphor strained..
To answer your second point: America is fairly well placed to emulate the French model, which is the best in the world. But we absolutely, need to get government involved in changing the incentive structure…
I think health care in this country, socialized or not, is severely in need of a rethinking. The AMA decides that they can be so selfish so that we have fewer doctors who make a lot more money and see patients for minutes at a time. Then, we have nurses who see patients *all* the time and do most of the work making pennies and working 16 hour shifts. The AMA has also been a major player in discouraging the government from having an interest in socialized medicine. Why? Because they think surgeons should make half a million dollars per year, and not because they are concerned about the health of the patients.
I think one argument that made a lot of sense to me is the parallel with our education system, at the very least for children. We have socialized education. It is widely accepted as necessary and helpful to the United States as a whole and to its people specifically. It is appalling that while we are willing to educate our children, we are not willing to keep them alive. But then don’t mothers and fathers need to be healthy to be able to raise their children? Or do we want them to live in pain and squalor?
PP, I question the judgement that Canada landed in candy. Canada’s infant mortality rate and life expectancy at birth are slightly better than ours, but those are affected by factors other than the health care system, and they’re not complete measures of health care effectiveness — knee replacement surgery, for example, doesn’t affect either but has a big impact on quality of life. If Canada’s health care system were better than ours across the board, there wouldn’t be any rich Canadians paying full price for American health care.
The cost difference is probably largely due to factors which America cannot emulate without severe costs (aggressive price fixing of prescription drugs, which Canada can get away with because drug companies can still recoup R&D expenses in the much larger US market), or which have little to do with socialism (Canada bans medical malpractice lawsuits).
Futile, I agree with you on the AMA. In my profession (programming), there are studies which show that output peaks at about 40 hours a week because beyond that fatigue diminishes performance by too much to make up for the extra hours. I’d be astonished if a similar effect weren’t at work in the medical profession. I’d also be astonished if the shortage of doctors and restrictions on medical practice by those who don’t have full AMA-approved doctor certifications didn’t play a major role in costs.
Socialized education in the US is a mixed bag. There are some pretty terrible public schools, and the system makes it very hard for to escape bad schools unless you can afford to pay twice (once in tuition, and once in taxes for the public schools you’re leaving behind). I, for one, would like to see much less socialism in our schools. I favor subsidies for the education of children of poor parents, but not state-run schools which you pay for whether you use them or not.
It is appalling that while we are willing to educate our children, we are not willing to keep them alive.
Please explain to me how this is an argument for socialized health care, but not for socialized food, socialized housing, socialized clothing, socialized toys, etc.
I’m pretty sure the best way to help the poor is to simply give them money and let them buy the things they need on the open market. Redistribution is possible without socializing the means of production, and not all that much redistribution is necessary to keep people from starving in the streets.
I think if you put all of your points together at once, you’ll arrive at a bit of an answer.
It is a necessity, it is expensive, AND people are very dissatisfied with how it is now. None of the examples you brought up hit all three of these criteria at once.
Admittedly, the housing market gets close, though the dissatisfaction with the housing market is not the market in general, but rather mortgages. However, you’ll notice that people HAVE been calling increasingly for government intervention in that area.
The gas market also is reaching a similar point (though the dissatisfaction and the expense are really the same point in that case), and there is also an ever-increasing call for government intervention in that area.
(Note that I’m not necessarily arguing that government intervention is necessary in any of these cases. That’s a separate issue. I’m merely pointing out how the criteria you used, when looked at all together, can answer your question already about why people, in general, would call for this.)
You’re telling me that Microsoft products are cheap and unnecessary?
“Necessity” is, of course, relative. Compared to food, housing and health care, yes, Windows is unnecessary.
I’ll agree that saying they “landed in candy” is an overstatement, but not more so than saying they jumped off a bridge. Yes, there are things we do better than the Canadians, but:
If you didn’t know if you were going to be rich or poor, would you rather live in a system that took relatively good care of everyone, or took little care for the poor, and outstanding care of the rich?
As for drug costs: It sounds (from what you say) like America is subsidizing Canadian drugs, and that if we institute price controls, our prices will go down and Canadian/European prices will go up. I say: sounds like a good deal to me…
I would say that IE is cheep (free to the end user), and unnecessary (Firefox does a better job). But _Damn_ is Vista the best OS on the market. 1 week with it and I can’t go back to XP. And I won’t touch Apples pOS X.5 with a 10m cattle prod…
If the system that took outstanding care of the rich also took very good care of the bulk of the population, I’d rather live there. Especially if in that society winding up as “rich” or “poor” was largely the result of your own efforts. I reject Rawls’s veil of ignorance argument on several grounds, not least of which being his horrific misapplication of the principles of game theory.
On the drug costs issue: the most likely outcome I see from price controls in the US would be that US drug prices would go down, and drug companies stop producing new drugs because they can’t recoup R&D expenses anywhere. Maybe we could use the threat of this to get Europe and Canada to scale back their price controls by enough that drug R&D doesn’t stop, but the cost if they don’t go for it would be dreadful. That hypothetical situation reminds me of that scene in Blazing Saddles where Cleavon Little takes himself hostage.
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If medical research becomes non-profitable, for whatever reasons, that it’s a textbook case of when government subsidies SHOULD be used, as a non-profitable activity which is none-the-less necessary for the public good.
So yes, there would be a cost to this price-fixing, but it would ultimately be a monetary cost in taxpayer dollars, not the horrible societal cost of cessation of drug research.
Government interventions are hacks. As a programmer, you should know what it generally means when you need to start layering hacks atop each other to fix the undesired side-effects of prior hacks.
Cb s th bst sclzd hlth cr systm n th wrld.
(Editor’s note: this comment has been disemvoweled. )
On Government intervention in new drug research:
When it comes to getting a large group of people (say, the group neccesary to come up with the next great anti-cancer drug) to come to work, to be creative to toil 80 hours a week in a lab, to live in your lab for 4 days straight… and to do this for years at a time… *nothing* compels such behaviors better than the profit motive.
I work in the medical technology field, and very literally, the day the government attempts to fix our prices and limit our profit, I will be changing careers to the video-game industry.
Great advances aren’t made by a bunch of people working 9-to-5, 40 hours a week… they are made by a small group of committed individuals who give up a large portion of their lives in order to add to the worlds knowledge and technology. Interestingly, the same skills that are useful in medical technology are also useful in other areas… and if you artifically limit the profit of the mega-producing individuals, they will change fields in a heartbeat.
I work in a field heavily regulated by the FDA, and if you honestly believe that the government can produce medical technology breakthroughs at anything approaching the rate that private enterprise does, you’ve clearly never worked with the FDA.
What’s with the disemvowelment?
But _Damn_ is Vista the best OS on the market. 1 week with it and I can’t go back to XP.
That is a joke, isn’t it?
And I won’t touch Apples pOS X.5 with a 10m cattle prod…
And I won’t touch Microsoft’s Winblows
XP v.2Vistass…To Doug, I think you somewhat missed what I was trying to say:
A) I’m also not arguing that this is necessarily the best solution. I never said it was the best solution, or even necessarily a GOOD solution. What I said, and the point I was making, is that price fixing would not result in a cessation of medical research, but merely a shifting of some of the monetary burden of that research to the government. I leave it up to the reader to decide if this is a good thing.
B) I’m not proposing that the government would do the work, merely that the government would SUBSIDIZE the work. There is a VERY big difference here. Note also that subsidizing could come in the form of research grants, or in the form of partial payment of drug sales (which is really government-run insurance accomplishing the goal of price fixing). Both of these have their problems, of course.
Now to Maniakes: You can view it as a hack, or you can view it as a part of larger, more complicated system for solving the problem of overly expensive drugs. Also as a programmer, you know that sometimes the simple, elegant solution (i.e. the market solution) produces very substandard results. Personally, I think that any well considered price fixing bill would also include some way of continuing to infuse the right money into the industry to make sure that medical research continues. I’m not advocating such a bill, merely making the point that, if done right, it wouldn’t be the sort of disaster you predict.
Subsidizing medical research rendered unprofitable by price controls would have a whole boatload of problems of its own, the biggest being that it would put politics in control of the decision as to what project to fund. The next biggest problem being that the cost of medical research is shifted from the people who benefit from the research onto the public as a whole.
Are drugs really overly expensive? It costs a lot of money to develop a drug, spend a decade or more proving that it’s safe and effective, and inform doctors and the public about the drug. At best, a system of price controls and taxpayer-subsidized medical research would just redistribute the cost of drugs, not lower it.
I think social programs which assist people who cannot feed/clothe/house themselves are a good thing. Regardless, if someone in my fairly well off family without medical insurance ( due to unemployment or whatever) were to get hit by a car, we would end up destitute and homeless. If we are hungry, we can buy food. Hell, we could even buy a house and my college tuition is paid for. However, medical bills are a completely different story.
And we already have precedence which indicates that universal health care is not going to destroy our medical system. It is not only about poor people. It is about everyone.
Assuming a purely redistributive program (along the lines of Friedman’s Negative Income Tax proposal) to make necessities affordable to the poor, not carrying medical insurance is a choice, like not carrying homeowners insurance or not carrying collision or comprehensive insurance on your car. Any of those can have catastrophic financial consequences, which is why most people do buy those insurances, but if you choose not to, why should that ruin things for everyone else?
I’m not denying that our current health care system has serious problems. I’m denying that socialized medicine is the answer. Other countries get better health outcomes at less cost with less socialism than we have now. I’ll outline how I’d reform the US health care system in a future post.
I already see that subsidized research has a boatload of problems. My point, again, was merely that price fixing wouldn’t be the type of disaster you described.
It would require a secondary action (a “hack” as you called it) to fix the primary problem opened by the first action, and this secondary action would have problems of it’s own. However, those problems (the politicizing of research funding, and increased government spending which may then increase the tax burden on everybody) are not NEARLY as severe as the problem that the second action solves (a near-complete cessation of medical research).
So, before you do any of this, you have the problem that drug prices are “too high”. Now, you can debate what “too high” means. Ultimately, it’s rather subjective. Those who complain about the cost of drugs would say that “too high” is not about the cost of the research and production going into them, but rather about how affordable they are to the people who urgently need them.
After you do it, you have the problems that drug research has been politicized, and government spending has been increased. There could be debates about whether being “politicized” is bad, as some would argue that a purely capitalistic approach might not properly fund research on some very nasty and important medical conditions just because a fast and/or profitable turn-around on that research doesn’t seem likely.
So, looking at these two sets of “problems”, the question is: Which is worse? This is a VERY complicated question, especially since there are arguments about whether the “problems”, on BOTH sides, are actually problems at all.
Any of you guys actually lived in a place with socialized medicine? I have lived in Tanzania and Japan and while both countries have their advantages when it comes to health care, there are serious drawbacks that I don’t see mentioned here – namely rationing.
In Japan it’s much harder to get better and more expensive procedures for chronic conditions such as diabetes, cancer and liver diseases. The quality of the health care I experienced in Japan was also lower than in the US; most of the expats I knew returned home to get treated for anything serious.
As for the comments about doctors vs. nurses, nurses receive two years of training – doctors seven. The average medical school costs $40k/year and the average debt for med students is $150k. While nurses salaries are rising, those of doctors is actually declining.
I have no beef with nurses getting paid well, but don’t shaft doctors. If you want to find waste, look at the health insurance industry. This employs hundreds of thousands if not millions of Americans to in essence shuffle paperwork.
Oh, and FWIW I support and have argued at DW and elsewhere in support of a national health care program.
A simple solution to the R&D cost recouping problem:
Pass a law that says drugs in the US can not be sold for more that 10% over the price of the average in the OECD.
Drug companies will quickly stop selling the drugs in all of the OECD countries and focus on the US market. The rest of the world would then have to come to the US to get their drugs at the full US price – in effect eliminating the US citizens subsidies of the worlds drugs. With more people buying the full priced drug the overall cost could come down (or be pocketed by the pharma companies – I will let you decide which is more likely).
The problem is fully with the pharma companies. A big part of the cost problem is the US is the only place where they are allowed to recoup their R&D costs. Change that and drug prices should come down.
That last para should have been:
The problem isn’t fully…
“(or be pocketed by the pharma companies – I will let you decide which is more likely).”
Given our current intellectual property regime, I would go with pocketed profits.
That’s a pretty good idea, Dave, except that interested countries anticipated it during negotiations for the last round of patent treaties. If a pharma company refuses to sell to another country at the prices that country offers, then the country can retaliate by revoking the company’s patents and producing a generic equivilent locally.
To Futile:
“Regardless, if someone in my fairly well off family without medical insurance ( due to unemployment or whatever) were to get hit by a car, we would end up destitute and homeless.”
If that’s true, then you were just being silly. Private health insurance that covers just exactly such circumstances can be had for $77 a month with a $5000 annual deductable. “Getting hit by a car” would cost you $5000 which while being a significant outlay, it’s anything like life-changing-financially-devestating. (By the way, those numbers I just through out are from BC/BS of California. Prices may be different in other states, I haven’t checked)
Before ya’ll jump in, yes, I’m certain that coverage like this excludes pre-existing conditions. My point is that, for *most* Americans, health-disaster-insurance can be had relatively cheaply. Of the possible reasons that one might argue for socialized health-care, “losing everything you own to pay for an unforseen health problem” isn’t one of them.
– DW
Regarding private, affordable health-insurance:
By the way, if anyone here needs private, affordable health insurance, or knows someone who does, check out:
https://www.tonikhealth.com/ca/
(Tonik Health is a trade name for BC/BS)
They offer several plans with annual out-of-pocket deductables ranging from $1500 to $5000, and monthly premiums ranging from $77 to $106. The $106 plan includes unlimited doctors visits.
I’d also like to propose this: rather than banter about “how can we help the poor folks without health insurance”… how about some of us pool our money and *buy* health insurance for the people we personally know that are good people and need help getting insurance?
My email address is DouglasWolf@yahoo.com. If you’re on this board and can spare $77 a month (or 2 x $77 a month) to help out a person who needs insurance and can’t afford itt, drop me a line. If you happen to be a person who’s in relatively decent health, but can’t afford the $77 a month for insurance, drop me a line.
If anyone here happens to have mad web-skillz they’d be willing to donate to a good cause, I suspect there’s an opportunity here to set up a web site to match health-insurance donors with people in need. I would be willing to fund (or help fund) the startup of such a website.
– DW