Marginal Revolution: Tyler Cowen pretends he is a Democrat

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Tyler Cowen pretends he is a Democrat

If I were a Democrat...

First, I would not cite evidence about how Western European countries spend less on health and are healthier than U.S. citizens. This data set, if you take it seriously, also implies that the marginal product of more health care, adjusting for income and a few other variables, is zero. Expanding health care would not be important. Now I believe this is an incorrect conclusion, but that is what shows up in this data. We should not invoke this data selectively.

Second, I would recognize that American policy generally works (or doesn't work) by building upon existing institutions. The most likely form of national health care -- for better or worse -- would extend a version of Medicare to more people. This would not lower health care costs, whether in gross or quality-adjusted terms. Keep in mind that negotiating price reductions does not per se lower real resource costs at all.

I would disaggregate health care systems and see where we could do the most good:

1. Step up R&D subsidies through the NIH and our university system, both high quality institutions. Their autonomy and micro-fiefdoms provide a good framework for risk-taking and innovation. The returns to medical R&D are extremely high. Furthermore the case for market failure, based on the inability to capture the full social gains from a new idea, is simple.

2. Redo the Medicare drug bill so that people can understand it (even I can't, nor does my mother), and so more people benefit. If need be, we can do this in budget-neutral fashion. The Bush plan is a mess.

3. Invest in local public health systems. Preventive care is important, especially for the poor. Price can be an obstacle but often the relevant constraints are behavioral in nature. Public health care systems should be easy and inviting, and they have to become part of life routines. Government can be part of the solution. Strong local public health care also will improve surveillance and later surge capacity if a pandemic comes along; this added benefit is significant.

4. Borrow a page from the libertarian litany about the FDA.

5. Institute prizes for successful vaccines. We have been discouraging vaccine production when we should be encouraging it; Michael Kremer has some intriguing proposals.

All those options are doable. All would save lives. None are fiscal disasters. They offer something for both rich and poor. They lay out a positive and constructive role for government, while keeping room for the private sector. None raise the prospect of excess bureaucracy or discourage innovation. None rest on the questionable belief that government as single supplier or payer would improve efficiency. And they are all areas where the Republicans are dropping the ball.

I would cut talk of national health insurance. I would cease obsessing over the number of "40 million uninsured," however good a debating point it may be. Many of these people are either linked to immigration or get decent medical coverage in any case. I would admit that we cannot take care of everyone and that we face tough trade-offs.

Hmmm...these counterfactuals are fun. What should I try next? Pretending I am a Republican? But for now, it is back to normal life...and so we return to your regularly scheduled programming. But comments are open, in case Kevin Drum's readers wish to pretend they are libertarians...

Posted by Tyler Cowen on November 11, 2005 at 06:21 AM in Medicine | Permalink

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» Healthcare and Life Expectancy from Political Animal
HEALTHCARE AND LIFE EXPECTANCY....Should we have a national healthcare plan? Tyler Cowen says no, but in the course of his argument suggests that increased spending on healthcare has no net effect on actual health. Matt Yglesias made the same claim... [Read More]

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» Tyler Cowen's health-care proposals from Freedom Democrats
"Marginal Revolution" is one of my favorite blogs, presenting an economist's perspective on all types of issues. I especially like Tyler Cowen's posts because he seems to share many "Free Democrat" values -- a liberal drive to help the least fortunate mem [Read More]

Tracked on Nov 13, 2005 7:46:58 PM

Comments

Fascinating. Why, do you think, have Republicans not chewed on these sorts of ideas (I am a rather reluctant Democrat myself and concede the intellectual bankruptcy of the party at this time)? Has incumbency turned them into overcautious softies? Have the people on Capitol Hill and in the think tanks, whose job it is to bat around ideas, turned over too much of the thinking to the White House? Are insurance companies, drug companies, etc, who give so much money to campaigns, too invested in the current system? I would think the political appeal of a national candidate/party that could offer some new (and relatively inexpensive) ideas on health care reform would be enormous and irresistible.

Posted by: Linda McIntyre at Nov 11, 2005 8:21:04 AM

Yes, indeed, these counterfactuals are fun. And, if taken seriously (as here), they could also be highly constructive. If this was a standard procedure in the public debate I predict than the delineation between positive and normative arguments would become more clear to a large part of the public, and perhaps also to the debaters themselves.

Posted by: Johan at Nov 11, 2005 8:22:24 AM

TC writes:

"First, I would not cite evidence about how Western European countries spend less on health and are healthier than U.S. citizens. This data set, if you take it seriously, also implies that the marginal product of more health care, adjusting for income and a few other variables, is zero."

1) The question is not the marginal product of "more health care" but the marginal product of more spending in the health care system, however it happens to be constituted. It should not be surprising if more spending on administration has zero health care value.

2) Stepping past that distinction, it is clear that the marginal product of more health care differs based on, among other things, how much a person is already spending on health care. The marginal value of $1000 in health care to someone who currently has no resources to spend on health care is quite large. The marginal value of $1000 in additional health care to someone who is already consuming lots of health care resources may be near zero.

Posted by: alkali at Nov 11, 2005 8:37:31 AM

One further thought -- TC also writes:

"I would admit that we cannot take care of everyone and that we face tough trade-offs."

Why can't we? Other industrialized countries do it. We'd have to raise taxes by a nontrivial amount, to be sure, but we certainly could do it if we wanted to. You don't get points for intellectual honesty by ruling some policy options out of bounds a priori without explaining why.

Posted by: alkali at Nov 11, 2005 8:45:56 AM

Sorry. We true liberals and compassionate progressives can't pretned to be libertarian and Evil. We believe in government control for the greater good, not people doing their own thing (which is Evil).

Posted by: Drumfan at Nov 11, 2005 9:09:43 AM

...and there are those of us that do not want the government to control every aspect of our lives, under guise of the greater good (which can also be evil).

Posted by: Mcwop at Nov 11, 2005 10:01:52 AM

Well, I'm glad you aren't a Democrat. And I'm REALLY glad you weren't a Democrat using bad economic theory to kill the New Deal.

1) is independantly a good idea, but it is not itself a cure for health care problems anymore than spending money on Pharma r&d was our prescription drug benefit plan.

2) The medicare drug bill needs to be scrapped and rewritten, but, once again, you're thinking too small and only slightly on topic. When liberals scream universal health care, hint, hint, they're talking about the UNINSURED.

3) Investing in local public health systems is a dubious idea. First of all, its not a permanent idea. If you invest in public health systems, Republicans will use their first opportunity to uninvest in them at no cost. Second of all, its once again throwing a pebble at an invading army in terms of adequate response. Third of all, it won't work for both federalist reasons (the federal government is bad at directing local institutions, and local institutions are bad at using grant money effectively when it is bestowed upon them without asking). Fourth of all, the amount of investment needed to make these things viable alternatives to private medicine is going to be significantly less politically feasible than UHC. Fifth of all, the amount of investment needed to make these things viable alterantives to private medicine is bad policy given we could just spend the money copying the very effective policies of (non-British) Western Europe (and Canada, too!).

4) is silly and not worth discussing. Kowtowing to the GOP based on an underlying theory of government that we don't believe in is not serious when it comes from Lieberman. When it comes from a REPUBLICAN (oh wait, a "liberterian"), its a joke, right?

5) "Institute prizes for successful vaccines". Vaccinations are great, and we don't need to resort to drugs to direct NHS and University money towards this goal. Except for AIDS and cancer, however, vaccinations aren't going to do much to solve the uninsured/cost problem, particularly given that the uninsured aren't going to GET these vaccinations in the first place . . . once again, a pebble at a rock problem.

"I would admit that we cannot take care of everyone and that we face tough trade-offs."

NO. WE. DO. NOT. YES. WE. CAN.

Don't you get it? Economics, as a predictive science, is a huuuuuuuuuuuuuuuuge failure. It always has been. This is hardly surprising, since the very basis of economics is based on flawed premises about human behavior and "utility". That being said, Canada and Western Europe's systems didn't spring out of nowhere, and they're not exactly mystical concepts that can't be replicated in the United States. We can insure everyone, get better results, and CUT TAXES DOING IT (sure, there will be a premium paid to the government, but this premium will be smaller than the premiums people currently pay, giving them more "income". Overall costs going to the health care delivery system should drop by a third, which, as you know, is a TON OF MONEY). I thought liberterians were AGAINST TAXES.

And in the previous post you point out that Canada, North Korea, and Cuba have the world's only "single payer" system. While this ignores the ease one can transfer to single payer and then, through cost cutting measures, to a French or Japanese system, it might also be useful to point out that CUBA HAS A SYSTEM WITH RESULTS COMPARABLE TO OURS. Which isn't really all that helpful to my argument. Until you realize THEY SPEND LESS THAN ONE FIFTH OF THE COST, AND LESS THAN HALF THE COST IN GOVERNMENT EXPENDITURES ALONE.

That this is "not politically feasible" is:

1) Because of people like you who should be ashamed of yourself and know better, who enable the lobbyists and the red-baiters in order to preserve their preconceived notions about classical economics.

2) No more true than the idea that gay marriage was infeasible in 1980, or that the elimination of the estate tax was infeasible in 1970, or that social security, medicare, and medicaid were infeasible in 1925. Political reality is not in stasis, and the Democrats (who are no longer the majority party) will not succeed anyway unless they can use persuasion to get the population to move with them, rather than "adjust" to form majority coalitions that no longer exist for them anyway.

Posted by: Justin at Nov 11, 2005 10:07:36 AM

I am confused by the first (multi-sentence) paragraph, and do not currently have the time to read the link from Robin Hanson (although I fail to see how the title is related as well). There is an extremely facile explanation that I can think of, that feels implied, but is so intellectually dishonest that I dare not think it is what you mean. That explanation is that since there is an inverse relationship between other countries spending and outcome there is an implication that less spending = better outcomes. I am sure that is not what you mena, but it creeps out of the text, as if simply dismissing the structural differences out of hand is warranted.
I very much like the idea of prizes for vaccines, but think it should be taken a bit farther as a way to reduce patent monopolies - (John Quiggin and Dean Baker have more on this) - many of the other ideas are good as well.
I would second some of alkali's comments as well.

Another point of contention is that the comment " American policy generally works (or doesn't work) by building upon existing institutions" is generally true, but the exceptions are significant, and represent the changes that we have made in the past that are comparable to universal health care, and that once these are established they are preferred (Come on, really put on your Democrat hat, you like Social Security!!!)

Posted by: theCoach at Nov 11, 2005 10:08:31 AM

Hmm...

Suppose I buy all my groceries at a convenience store, and pay $100 a week for them. My neighbor buys the same bundle of groceries every week at a supermarket, and pays only $80 for them.

Would this data set imply that the marginal product of my spending on groceries is zero?

Maybe in some hyper-technical sense, but not in any meaningful way. It implies that we're spending at different margins. I'm spending in a wasteful way, she's spending in a thrifty way.

That's the situation that advocates of universal health coverage see the U.S. in, when compared to some European nations.

BTW, I think all five of your ideas are good ones. But I still think universal health coverage is a good idea, if done right. And rather than take the pessimistic public-choice theory perspective that "it can't be done right," I'm optimistic that we can look at what other countries have done right and wrong, and figure out something that will work for us.

Posted by: Brock at Nov 11, 2005 10:11:08 AM

OT, Is this the open comment exception that proves the rule?

Posted by: theCoach at Nov 11, 2005 10:18:28 AM

Good post. Disagree with the following:

"[evidence about how Western European countries spend less on health and are healthier than U.S. citizens]...also implies that the marginal product of more health care, adjusting for income and a few other variables, is zero."

Not really. Do you suppose we're allocating our health care dollars the same way? $1M on cheap, simple preventive care may go farther on average than $1M on bleeding-edge cancer treatments. The anti-US health care crowd seems to argue that we're spending our health care money in a non-optimal way.

There are many downsides to the American practice of linking health care to jobs. One of them is that your medical insurer has little incentive to make sure you're healthy in five years. For example, there've been many claims (which I do not know enough to evaluate) that veteran's health care in the US provides far more for far less.

Posted by: gundryggia at Nov 11, 2005 10:21:59 AM

I would admit that we cannot take care of everyone and that we face tough trade-offs.

I'm really unclear about the above. Advocates of national health insurance want precisely to take care of everyone, and if we really can't do it, they've wasted a lot of time. Some of them are pretty smart, so I'd be surprised if the evidence makes obvious that this can't be done. Also, I'm not sure why Western Europe isn't evidence that it can be done.

Posted by: SomeCallMeTim at Nov 11, 2005 10:29:42 AM

"it might also be useful to point out that CUBA HAS A SYSTEM WITH RESULTS COMPARABLE TO OURS. Which isn't really all that helpful to my argument. Until you realize THEY SPEND LESS THAN ONE FIFTH OF THE COST, AND LESS THAN HALF THE COST IN GOVERNMENT EXPENDITURES ALONE."

What's actually useful to point out is that CUBA CLAIMS TO HAVE A SYSTEM WITH RESULTS COMPARABLE TO OURS. Cuba, like all Communist dictatorships before them, has long been in the habit of claiming all sorts of things without much regard for such borgeois Western concepts as "truth", "fact", or "accuracy". The Soviets, as I recall, had similar impressive claims regarding the health and well-being of their people, the state of their armed forces, and so on that turned out not to stand up to any sort of scrutiny.

"There are many downsides to the American practice of linking health care to jobs. "

I agree. We need to stop doing that. We don't need national health care in order to stop doing that. The alternative to people having their bosses buy their health insurance isn't limited to people having the government buy their health insurance. They could buy it themselves. Granted, having people buy things for themselves has only been tried in hundreds of other industries for a handful of centuries, but I think it'll work.

Posted by: Ken at Nov 11, 2005 10:33:32 AM

Tyler, why do you deny that the marginal product of health care spending is zero? It seems to be backed by many different strands of evidence.
Why dismiss the possibility of simply using some other country's system, a system which has already been tested and which works? If I was a Democrat I would think that the returns to medical R&D are high, but I'm a contrarian, so I doubt the conventional wisdom here.

I agree "that increases in life expectancy from reductions in mortality due to cardiovascular disease over 1970-1990 has been worth over $30 trillion dollars - yes, 30 trillion dollars (for this research see: book, papers, summary). A conservative estimate is that 1/3rd of these improvements in life expectancy were due to better medical technology." but I have experience in biotech, and in both academic and government research. My strong suspicion is that marginal dollars spent on medical research are as useless as marginal dollars spent on healthcare. What I would favor is the establishment of prizes for medical research Outcomes. At $10,000,000,000 the Methusaleh prize would be grossly under-funded. Smaller prizes relating to the specific "seven deadly sins of aging" and for work in other animal models would also be appropriate. The wonderful thing about prizes is that if they don't work they are free to the taxpayer. By contrast, as a Methusaleh donor, I pay whether the work succeeds or fails. Another thing I would favor, if I was feeling really flush, is "Medical tenure". Allow any M.D., Medical researcher, and possibly even any alternative medical practitioner who can pass some difficult exams in statistics to leave their job permanently and spend the time working on any medical problem they think is important. During this time they would recieve the lesser of 50% of their most recent year's after tax income and 1.5 times the US median after tax income for personal use. An equal amount would be available without for grants or expenses related to providing any medical service or performing any sort of research that they believed to be important. They would be required to record the outcomes of their work using standard statistical tools and to relinquish any IP claims developed under government funding and would not be permitted to charge for their services in medicine or any other field while thus employed by the government.

Posted by: michael vassar at Nov 11, 2005 11:05:58 AM

Just piling on, 'cause Tyler really deserves it:

First, Tyler, you aren't a Democrat; you are a Republican.

Sceond, this is, at best, like looking at a raw corelation between two variables, and ignoring significant confounders. Especially as (guessing here) the ENMP (extremely naive marginal product) is probably negative.
When you see a raw relationship between two variables which is the opposite of what theory and history would predict, it's time to be suspicious of that raw relationship number.

As said above, in a certain sick, twisted and useless sense, that's true. That sense can be summed up as Barry's theorem: "for almost any input-output relationship, it is possible to find a situation where the same input magnitude would yield fall lower output values", or, more simply, "no matter who bad things are, it's possible to scr*w them up worse".

Posted by: Barry at Nov 11, 2005 11:15:26 AM

"The alternative to people having their bosses buy their health insurance isn't limited to people having the government buy their health insurance. They could buy it themselves. Granted, having people buy things for themselves has only been tried in hundreds of other industries for a handful of centuries, but I think it'll work."

So why hasn't it worked? Curiously, private insurance companies are not uniformly thrilled by the idea of sick individuals buying health insurance. I can't say I blame them.

Posted by: gundryggia at Nov 11, 2005 11:20:34 AM

It's impressive how many people are willing to dismiss Tyler's comments without even reading the evidence he supplies.

Regarding the marginal value of health care:

(1) A recent comparison of 21 developed countries also found national life expectancy did not vary significantly with medical care spending, after controlling for income, education, unemployment, animal fat intake, smoking, and consumption of pharmaceuticals...

(2) The most respected relevant study is the RAND Health Insurance Experiment, which for three to five years in the mid 1970s randomly assigned two thousand non-elderly US families to either free health care or a plan with a substantial copayment. Those with free care consumed on average about 25-30% more health care, as measured by spending, obtained more eyeglasses, and had more teeth filled. They had more appropriate medical visits, and as a result suffered one more restricted activity day per year. Beyond this, there was no significant difference in mortality, a general health index, physical functioning, physiologic measures, health practices, satisfaction, or the appropriateness of therapy.

(3) An optimistic accounting of the benefits of specific treatments attributes only five years of the forty or more years of added lifespan over the last two centuries to medicine [17].

(4) The small health effects of medicine also raises the question of why exactly lifespans have increased so dramatically. Over the last century, age-specific mortality rates have fallen at a steady exponential rate across developed countries, without noticeable changes due to major medical and public health innovations [98, 61]. Improvements in sanitation are often given great credit, but no effect on mortality has been found among individual variations in water source and sanitation, even among high mortality populations [33]. Average nutrition has greatly increased, but the fact that people who had very high nutrition a century ago had much higher mortality that we see today makes it hard to attribute most lifespan gains to nutrition.

This and more are all in the link Tyler supplied. Now, you can dispute this evidence by marshalling your own to contradict it, or you can give up on the idea that Europeans are healthier because they have national health care systems and so for some reason spend their money more effectively.

Posted by: Javier at Nov 11, 2005 11:29:24 AM

You'd be against regulations and for corporations just like you are now. Instead of being a corporate cheerleader disguised as a libertarian, you'd be a corporate cheerleader disguised as a Democrat. What am I missing here?

P.S. Smart move getting rid of that Alito ad! "Libertarians for Alito" didn't quite cut it.

Posted by: Deb at Nov 11, 2005 11:52:33 AM

No comment on the specific issue here, just a tip that I and others have mentioned before. You have to do the math for your own situation, but you can get up to 50% discounts from doctors if you pay cash. The doctors get the benefit of not dealing with the claims and bureaucracy while you get the benefit of knowing a truer market price, getting the discount and not paying health care premiums. I do recommend catestrophic insurance.

Posted by: Patinator at Nov 11, 2005 11:55:11 AM

RE: "corporate cheerleader" - I assume you live in the woods and don't work for any company, own any stock or puchase goods or services. Otherwise you are a HYPOCRITE!!!!

Posted by: Deb = Simple Minded at Nov 11, 2005 12:10:49 PM

"'I would admit that we cannot take care of everyone and that we face tough trade-offs.'

Ok, lets start with medical innovation. The US subsidizes the whole world in pharmaceutical innovation. Other industrial countries don't have to have free market systems in drugs because ours pays for ours and theirs.

Posted by: Sebastian Holsclaw at Nov 11, 2005 12:36:54 PM

"That being said, Canada and Western Europe's systems didn't spring out of nowhere, and they're not exactly mystical concepts that can't be replicated in the United States. We can insure everyone, get better results, and CUT TAXES DOING IT"

That rather presupposes that everyone in Western Europe is in fact getting coverage form the State. Which is not true. i know of at least one person here in Portugal who does not get anti-retrovirals from the State medical system. I need to have a tetanus booster in afew weeks, something I shall pay directly for. My wife, when she broke her foot, paid for the X-Ray directly.

I think you have a rather undetailed view of exactly how Western European health care systems work.

Posted by: Tim Worstall at Nov 11, 2005 12:47:32 PM

"Ok, lets start with medical innovation. The US subsidizes the whole world in pharmaceutical innovation. Other industrial countries don't have to have free market systems in drugs because ours pays for ours and theirs."

Which is in fact an explanation. But it isn't necessarily TC's explanation, which is what people are asking for. It also suggests that TC should have written "or" rather than "and".

Posted by: SomeCallMeTim at Nov 11, 2005 1:30:37 PM

data set implies that the marginal product of more health care is zero.

That's just so wrong. It's just the simplistic conclusion an econometrician could come to.

The simplest explanation is that the spending in the US is concentrated on the wrong tasks, or even on the wrong people. A lot money is spend on dentists, pain-killers, Prozac, MRIs, etc. by people who have the money and none of it is significantly extending their lifes or rising the metrics that are usually chosen to measure health.

On the other hand people without insurance get excluded from the necessary life-saving, risk-reducing health care. And when I say other people, I mean mostly Afro-Americans and immigrant minorities. I don't have the data at hand, but one of the measures I've seen shows that their health standards are on the level of third world countries.

So the big question is whether you are content with knowing that your tax dollars are going to people of a different race. Most Europeans do not have this problem (but the rising amount of immigrants will create a lot of Euro-Republicans).

Posted by: Oskar Shapley at Nov 11, 2005 2:43:24 PM

Tyler wrote, "I would admit that we cannot take care of everyone and that we face tough trade-offs."

I agree. I take Tyler's statement to mean the following: If the U.S. were to guarantee that every resident will be given all the healthcare that he/she could arguably need, no matter the cost and no matter the person's ability to pay, and were to actually try to make good on that guarantee, the compulsory wealth transfers that would be needed would be so great that U.S. productivity would stall and its standard of living would drop accordingly, with the result that we could never reach a point where everyone would get the level of care that some people get now.

Posted by: John P. at Nov 11, 2005 3:13:13 PM

It's obviously true that we can't make available to absolutely everyone in the country every medical procedure that could possibly be of some medical value without regard to cost. No country does that. It's impossible. That's what it means to say that we have to make trade-offs with regard to providing health care.

IMHO, this is the biggest problem with the debate on health care. For some strange reason, most people seem to think of health care as a binary proposition: you either have it or you don't. That's absurd. Everyone in this country has access to some form of health care even if it's only through the ER. Likewise, everyone in the country has incomplete access to health care. Even Bill Gates wouldn't necessarily be able to get an organ transplant if he needed one on short notice.

Posted by: Xavier at Nov 11, 2005 3:22:43 PM

I find it very, very depressing to read these generally mean spirited attacks, most of which don't bother making an honest intellectual attempt to understand Mr. Cowen's point of view, let alone provide evidence of why he his wrong and/or right. I applaud those few that have used this forum as a means to exchange ideas and learn from one another, rather than scream angrily (not to mention pointlessly).

Posted by: Chris at Nov 11, 2005 4:11:46 PM

There are really two separate issues to be dealt with in reforming american health care.

1. the market failures of the health insurance system, the segregation of risk pools, the consistent attempts by health insurance companies to engage in cherrypicking, and attempts to escape their obligations to coverage (if my insurer spent 1/2 the amount they spend on denying needed coverage on making existing treatment more efficient they would save money).

2. the hobbling of innovation in medical technology. Given our current level of technological ability, why can't anyone purchase a blood chemistry analysis machine for approximately the cost of a new PC? It's not that we couldn't build such a thing, or that there wouldn't be a market for it if existed, but no one has taken the lead in creating the conditions for that market (as for instance public subsidies of highways created a market for automobiles).
A major technical initiative could dramatically cut the costs of and improve the effectiveness of all medical care.

Neither republicans nor democrats can solve these problems alone, and they are not amenable to to the bloody partisanship of the past several decades of "leadership".

Posted by: Larry at Nov 11, 2005 4:17:32 PM

Well, geez. I asked Tyler for an explanation of why he doesn't like the european systems -- they're not a "good idea." And he gives it now. I'll have to sit down and read what's said in the links he has provided before I can respond directly to him. But I must say, if the commenters here are from Drum, they're not so impressive. I don't care who Tyler votes for; I only care whether he's persuasive. And he's given me a lot to think about, and I will. I suggest that attacks against him or his perceived personality are beyond useless.

Javier, I could have used a link or two for your assertions, unless they're in the links that Tyler provided.

Oh, and the dealie about immigration: This is a serious problem, not trivial at all. Tyler tends to shrug it off by saying that we don't owe them medical care. But at a pragmatic level, we do. If we allow them in, we owe them medical care so that they don't cause medical problems here. Unless we deny them emergency care when they have emergencies -- that is, deny them completely -- we should invest in their preventative care in hopes of reaping cost savings down the road, both for them and for the people they interact with. Bugs don't respect boundaries. Yet -- I agree that this opens up huge cost requirements. Hard darned problem.

Posted by: ralph at Nov 11, 2005 5:19:21 PM

Larry's point #2 is directly addressed by Tyler's point #4. The FDA currently blocks the innovation needed to create rapid technical development in healthcare. To give just one example of the barriers, if a drug company finds a new stopper for a drug vial that is somehow better than the one they already use, they have to do a zillion tests (for multiple $100,000s) and file a supplemental application (currently about $400,000) to switch. And this is after the stopper manufacturer has spent millions to do all the tests to pass the FDA's marketing requirements.

I agree totally with Xavier's point about healthcare being thought of as a binary proposition. To use an analogy, this is like saying the U.S. can afford to feed everyone. Of course society, through taxes, can make food free. But is it going to be soy pellets (or soylent green)? I doubt society can afford to give everyone lobster, filet mignon, or [insert your favorite high cost food here]. So you have a quality continuum to deal with. But will my 6 year-old get the same amount as the 300 pound defensive end for the Eagles? Probably you need to deal with a quantity continuum also.

So let's assume all the important people have managed to agree on the quality and quantity issues--perhaps everyone is entitled to four Wendy's hamburgers, an apple and two bananas, and a large diet soda (no fries--bad for the health ;-) every day with a sliding scale for ideal weight (e.g., if you are 400 pounds and 5 feet tall, you do not get additional portions ;-) Maybe this could work as long as the promises weren't too lavish.

But then, since this analogy is supposed to parallel the healthcare system, another big problem pops up. As a person gets older they need more burgers (healthcare). And some people need a higher quality of food, burgers just won't cut it. So we have a lot of people, especially those who are just about to die, who need 65 lobsters a day to stay alive. Hmmm, when do we cut them off?

Oh, and what about those people who just can't/won't agree to eat burgers? They go on a hunger strike if they don't get better. Does society have a responsibility to feed them? (Just to be obvious, the healthcare equivalent is the noncompliant diabetic/hypertensive.) And what about those who consistently drop their burgers on the floor (think of the uncontrolled schizophrenics who can't stay on their meds).

All of a sudden it has gotten really, really complicated to provide food for every person. And we haven't even thought about 'preventative food', or 'palliative' food, etc. And to switch back to healthcare, it's not just quantity and quality, people need different kinds of care at different times in their life. And in many cases, we don't really know what works and what doesn't. Etc., etc., etc.

There is no way this can work with centralized decision-making.

Posted by: SteveSC at Nov 11, 2005 5:34:22 PM

Step up R&D subsidies through the NIH and our university system, both high quality institutions. Their autonomy and micro-fiefdoms provide a good framework for risk-taking and innovation.

Sorry, but this won't work. The problem isn't that we're not spending enough on the NIH. It's that doctors have no incentive to incorporate a majority of the NIH's work. For example, the NIH has shown simple regular maintanence will control diabetes. But doctors don't have enough profit incentive to administer this kind of ongoing care. Until we find a lower cost alternative for medical delivery, you might as well bury the money in a hole.

Posted by: Ted Craig at Nov 11, 2005 5:54:57 PM

SteveSC -- Very nice. 10 points for Griffyndor.

Posted by: John P. at Nov 11, 2005 5:58:07 PM

Ralph, as I said in my post, everything I quoted from was from the links that Tyler provided.

Posted by: Javier at Nov 11, 2005 6:51:17 PM

"I would cease obsessing over the number of "40 million uninsured," however good a debating point it may be. Many of these people are either linked to immigration or get decent medical coverage in any case. "

I fail to understand why 11 million uninsured are not worthy of consideration just because they're immigrants.

Moreover, as Drum just pointed out, it might indeed make sense to abandon the 40 million uninsured talking point in favour of the **80** million who are uninsured for some point in any given two year window.

"I would admit that we cannot take care of everyone and that we face tough trade-offs."

That sounds willfully and needlessly defeatist, a conclusion in search of rationalizations.

Posted by: ArC at Nov 11, 2005 11:17:43 PM

SteveSC, bad use of straw men arguments, 20 points from Griffindor.

Posted by: Justin at Nov 12, 2005 2:32:22 AM

Ralph wrote, " I asked Tyler for an explanation of why he doesn't like the european systems -- they're not a "good idea." may I suggest you start perusing Scott, Brit, Canuck, Ozzie and Kiwi blogs, you might find out why.

We not only subsidize our now well-off "good friends and historical allies" via drugs, we subsidize them via our military.

May I also suggest that we should take a page out of our history and allow healthy immigrants in???? Before they get their visa, they have to go thru a battery of tests given by an American physician at our embassy. It is a bit more difficult now, but we made it a point of not letting in people who had lice, polio, TB, etc., we can do so again.

How interesting 80 million in a two-year window. Why 2 years??? Are they w/o insurance for 2 years???? Or just 1-2 months until they find another job??? Sucks if you get sick in those 2 months, but do most get sick during that time or are they well???? And it's the same for the not-so-true 40 million, they're not w/o insurance for the year, isn't it only at some point? So, are we really looking for something temporary, basic and cheap to tide them over?

Britain has a good program as long as you're not a sickly fetus, long-term incapacitated or over 60. But then again, as Iain Murray once pointed out, the British are knows for their bad teeth and they've had national dental insurance for 60 years.................

And yes, ArC, there are tough trade-offs. You're old you die, no 6 month extension trying to do everything possible to live a few more months. That's where a lot of our money goes, the last 6 months of life. You tell Grandma or mom sorry and pull the plug.

Posted by: Sandy P at Nov 12, 2005 2:41:06 AM

And just to let everyone know just in case they don't - the Canucks are pouring 41 billion loonies in over 10 years to improve their system - what military?

Brit was 5.6 billion euros or $, can't remember, the froggies 15 billion euros/or $ so their system wasn't as lousy as Britain. Scotland 2 billion, the Ozzies and Kiwis were also spending lots o cash to improve theirs, too. The gov't isn't the panacea some would think.

The middle-class Canucks are taking out HELOCs to get their elective surgery here.
Private healthcare business booming

Tom Blackwell
National Post Saturday, April 23, 2005

Patients fed up with long waiting lists in Canada are fueling a fast-growing demand for brokerages that arrange speedy service in the United States as well as in Quebec's burgeoning for-profit medical industry.

Brokers and other similar companies say business has as much as tripled over the past year as Canadians apparently become more comfortable with paying for diagnostic tests, second opinions and even surgery.

They say their patients include not only the wealthy but also middle-class people willing to take out second mortgages or lines of credit to pay for faster care.

Driving the move are Canada's lengthy waiting lists for many medical procedures. A study last year found Canadians waited an average of 8.4 weeks from their general practitioner's referral to an appointment with a specialist in 12 different medical specialties, then waited another 9.5 weeks for their treatment. Those wait times are almost double what a similar study found in 1993....
----------------
And there's your wonderful single-payer system. Illegal for-profit system, but Quebec is always the cultural exception.

Posted by: Sandy P at Nov 12, 2005 2:50:58 AM

Sandy, as I posted on the other thread, anecdotes about Canadians 'flocking' to take advantage of US care don't seem to be borne out by the statistics.

http://content.healthaffairs.org/cgi/content/abstract/21/3/19

Note that Blackwell's article (I found a freeper reprint), by contrast, makes absolutely no effort to put the numbers in context of how many patients are treated in Canada. A story much like that could be written stringing together anecdotes of people who couldn't afford care in the States, along with context-free numbers about people who went to Canada for treatment and it would be worth just as little, in my opinion.

Sebastian, about 'subsidizing innovation', just how _does_ spending billions of dollars for administrative and marketing overhead pay for innovation, anyways? And by 'innovation', are we including copycat drugs that do the same as generics but have fresher patents?

Posted by: ArC at Nov 12, 2005 7:38:46 AM

Re: "just how _does_ spending billions of dollars for administrative and marketing overhead pay for innovation, anyways? "

The mere posing of that question exposes such a profound ignorance of market economics, it makes one shudder.

Think for a moment. How is it that you are able to buy a computer at Wal Mart that is cheaper now than it was 5 years ago, despite all their admin and advertising overhead (from *both* the store and the computer company)?

And think, are Medicare's administration costs really cheaper than the private sector's, since they get to "ignore" costs normally associated with administration, such as fee collection and paperwork (both tasks delegated to other agencies or the private sector, and seemingly "free")?

And think about it, why is it that the state-owned industries in Britain, what with their "cheap" admin and no marketing for decades after World War 2, failed to such a fantastic degree that in the mid 1970s it has to take a 2.3B pound loan from the IMF, like some 3rd world country? The industries were eventually sold off under Thatcher, and only then began to recover. Ask yourself, why is that the case?

Posted by: Kevin F at Nov 12, 2005 9:15:46 AM

Re: "And by 'innovation', are we including copycat drugs that do the same as generics but have fresher patents?"

Oh yes, we would be so much better off without many different cars and manufacturers to choose from, wouldn't we? So much much waste! Maybe we should do like the Soviets did, and manufacture only *one* car? Of course, that car was the low-quality East German Trabant, the model that remained in production for almost 30 years, without important modifications. The plastic-bodied P-601 was "an example of extreme essentiality: no valves, no camshaft, no timing belt (the engine is a two stroke), no oil pump, no water pump, no radiator (air cooled)!"

Yeah. let's do *that* with American medicine.

Posted by: Kevin F at Nov 12, 2005 9:36:42 AM

Re: "copycat drugs that do the same as generics but have fresher patents?".

Ignorance again.
Celexa and Zoloft are "copycats" of the antidepressant Prozac. However, they both have different side effect profiles, and are effective in some patients that Prozac failed to help. Similarly, Zoloft differs from Celexa in its side effects and efficacy.

Or to put more simply, Zoloft, Celexa, and Prozac are "copycats" in the same way that Apple, Dell, and HP are computer "copycats."

Wouldn't we all be better off if we just let *Andrew* (ArC) choose our one single antidepressant drug for us? He seems to know the topic well enough.

Posted by: Kevin F at Nov 12, 2005 9:47:32 AM

Uhh, ArC?

Do you really want to quote a study in which stats were from 1994 to 1998?

Things have changed drastically up there.

Via Econopundit:

I know I've argued about the reliability of the health insurance numbers, but now we get this from impeccable sources. The Bureau of Census now reports 15% of the population have no regular medical care and routinely flood emergency rooms with routine problems.

No -- wait I got it wrong! That wasn't the US Census Bureau -- it was Statistics Canada describing problems with Canada's single payer system, where the average waiting time for specialize procedures is about 18 weeks!

http://www.econopundit.com/archive/2004_09_01_econopundit_archive.html#109525092053575778

http://www.alertnet.org/thenews/newsdesk/N14352624.htm

CORRECTED - Canada's once-proud public health system in crisis
14 Sep 2004 17:45:27 GMT
Source: Reuters

In OTTAWA story, "Canada's once-proud public health system in crisis", please read in the seventh paragraph, "Medicare eats up C$85 billion ($66 billion) a year in public funds...", instead of, "Medicare eats up C$85 billion ($39 billion) a year in public funds..." Corrects U.S. dollar conversion.
A corrected repetition follows.
By David Ljunggren
OTTAWA, Sept 14 (Reuters) - Canada often boasts its universal health care program shows it is more caring than the United States, but the system is creaking alarmingly, with long wait lists for treatment, and shortages of cash and doctors.
And far from criticizing the United States, some people are choosing to go south of the border to pay for operations in private hospitals -- institutions that are forbidden in Canada by the law that set up the publicly funded system.
Politicians, experts and professionals generally agree that the medicare system needs major reforms, but the program's cherished status as an icon of Canadian identity means big changes are politically risky.

"Few would dispute the prevailing reality of our time: people in this country are increasingly anxious about their ability to get in to see the right health professional at the right time," Prime Minister Paul Martin said on Monday.
"Meanwhile, financial pressures are increasing as our population ages, as medical knowledge...expands, and as beneficial but expensive new treatments become available," he told a top-level meeting designed to rescue medicare.

Martin, joined at the table by the premiers of Canada's 10 provinces, faces a hornet's nest of problems as he tries to fix the health system. Medicare is jointly funded by the federal and provincial governments but run solely by the latter, an arrangement that causes plenty of rancor.

Medicare eats up C$85 billion ($66 billion) a year in public funds alone and the provinces continually demand more money, with no strings attached. Ottawa says it is prepared to contribute more but insists the provinces agree to benchmarks to ensure the funds are being spent properly.

As the politicians bicker, Canadians spend more time waiting in line. A study by the right-wing Fraser Institute this month said that average waiting time for treatment in 2003 rose to 17.7 weeks from 16.5 weeks in 2002.

"This grim portrait is the legacy of a medical system offering low expectations cloaked in lofty rhetoric," the study said, criticizing the fact that governments and not doctors are responsible for allocating resources.

Some delays are much longer. Patients in Ontario who require major knee surgery can wait six months to see a specialist and then another 18 months for surgery.
"When I started work 30 years ago it took three weeks to get a patient into a specialist's office. Now it can take six months. There is a lot of inhumanity built into the system," one unhappy family doctor told Reuters.

Statistics Canada said in June that some 3.6 million Canadians, or 15 percent of the population, did not have a regular doctor last year. This means hospital emergency rooms are flooded by people with routine problems.

Experts say the shortage of doctors will only get worse as an increasingly elderly physician population starts to retire over the next decade. And as medical expertise becomes ever more sophisticated, so will the demand and the expense.
"There will be new treatments which don't exist today that will exist 10 years from now and we'll have to address those wait times," New Brunswick Premier Bernard Lord told the meeting on Tuesday.

Some provincial premiers -- notably Ralph Klein of Alberta -- say one obvious solution is to increase the use of private clinics and hospitals, where people would pay for treatment.

Ottawa has in the past withheld health care funds to provinces experimenting with for-profit clinics and new federal Health Minister Ujjal Dosanjh took up his job in July with a vow to "stem the tide" of privatization.
($1=$1.29 Canadian)

Posted by: Sandy P at Nov 12, 2005 12:07:09 PM

EEK - Sorry, guys, longer than I thought.

Posted by: Sandy P at Nov 12, 2005 12:08:29 PM

"Think for a moment. How is it that you are able to buy a computer at Wal Mart that is cheaper now than it was 5 years ago"

Because a computer is composed of _microelectronics_, one of the few sectors where you can actually expect that kind of yearly improvement thanks largely to a (relatively) straightforward process of process shrinks. (and also because shrinking margins have cut back on quality equipment in PCs, grumble grumble.) Why didn't you pick, say, anti-allergy medication? Or has heart surgery gotten cheaper?

It seems to me that electronic high tech is not in any way a good analogy for health care.

"15% of the population have no regular medical care and routinely flood emergency rooms with routine problems."

An odd reading of the actual report, which said that 86% of the pop _had_ a regular doctor, 5% couldn't find a regular doctor (troubling) and 9% _hadn't looked_. I got sick this year, but in the 4 years before that, I hadn't even seen my GP once. If I'd moved, I wouldn't have answered that I had a GP, but I wouldn't have had to look.

By the way, do you know what percentage of the US does not have a regular doctor?

http://content.healthaffairs.org/cgi/content/full/hlthaff.w4.487/DC1 (see figure 2)

Clearly by those metrics, Canada doesn't come out on top. I can admit that. But I'm not about to champion another step backwards either.

Posted by: ArC at Nov 12, 2005 4:24:25 PM

This is what I like to hear/read, "real solutions" that do not call for more taxes and pass more ridiculus laws.

Keep up this type of good work!

Posted by: Jim Coomes at Nov 12, 2005 5:17:41 PM

Re: "Because a computer is composed of _microelectronics_, one of the few sectors where you can actually expect that kind of yearly improvement thanks largely to a (relatively) straightforward process of process shrinks."

That sentence meant nothing at all.
Your command of economics is risible.
And allergy medicines? Just ten years ago, all that was available OTC was benadryl. Now there are multiple meds and manufacturers of OTCs, and numerous prescription alternatives available.
Do you read up on *any* of this stuff?

Posted by: Kevin F at Nov 12, 2005 6:16:03 PM

"That sentence meant nothing at all. "

OK. Let's try one more time. The improving price-performance ratio of computers is unique to microelectronics, due in large part to 'process shrinks', which means manufacturers have a well-known way to get more performance: make transistors smaller. I know it's not entirely straightforward; CPU designers have to deal with latency and slow memory and all sorts of other details. But the engine of growth is relatively well understood; more so than pharmaceuticals. Do you really think drugs have anything equivalent to Moore's Law?

(Yes, I know it's not a real 'law' of anything.)

"Just ten years ago, all that was available OTC was benadryl."

Goalposts moved, man. You said 5 years ago in your extremely bogus computer analogy, and I know the OTC allergy medication I took *5* years ago is the same one I take now.

Why are you being so hostile, anyways?

Posted by: ArC at Nov 12, 2005 6:51:13 PM

Actually, replace "engine of growth" with "engine of improvements".

Posted by: ArC at Nov 12, 2005 6:54:21 PM

The problem is that even in areas that have potential 'process shrinks' the FDA stands in the way. What would have happened to progress in microelectronics if we had a government agency that not only spent a couple of years evaluating the safety and quality of every new component in a computer (before it was allowed on the market), but also required every computer assembler to stress test every combination of parts for a year to make sure they were compatible? Even if another assembler had successfully tested the exact same combination? Moore's Law would suddenly become a 10% improvement every 10 years.

Real life example: Injectable medication, only constituents are the active pharmaceutical ingredient (API) and salt water. Generic manufacture tries to make less expensive copy. In the manufacturing process, the manufacturer adjusts the pH to make the end product identical to the branded product, using a grand total of 1 drop of HCl for every 7 gallons of product. End product is chemically indistiguishable from the branded product by every known analytic method. FDA rules that this is a new drug that must go through the more expensive and longer duration new drug approval process.

Now that I think about it, I think I overestimated progress at 10% every 10 years...

Posted by: SteveSC at Nov 12, 2005 7:54:51 PM

ArC,
You seem to think that computers operate by some economic process unique to that product. And that is pure bunk.

Computing is simply where electrification was 100 years ago. Before that, it was the machine age and mass production. Big deal. "process shrink" has been here before; it's not a new finding.

The difference between medical products or services and other markets is simply the government factors of rules, regulation, and control. Nothing more. Medicine has made similar leaps and bounds in technology as seen in computing. The multiple methods of cardiac procedures, both invasive and nearly-non-invasive, is staggering.

I am not trying to be hostile. I just don't know any other way to point out that you don't seem to grasp some basic principles of economics.

Posted by: Kevin F at Nov 12, 2005 9:42:47 PM

Kevin, you're right that mass production is hardly new. But the /scale/ of computer improvement is so unusual that I find it hard to be swayed by analogies from anything else to computers. Sure, let's go with ten years ago instead of five. Ten years ago, Windows 95 was struggling to run on anything except a top-end 486, and 8 mb of memory was recommended (but definitely not standard!), if my faulty memory serves. The anti-allergy medicine Reactine was just then making the change from prescription to OTC. And now, we have WinXP on Pentium 4s and AMD 64s with /half a gig/ of RAM on the one hand... and OTC Reactine on the other.

Also, I honestly can't figure out what you're saying in the third paragraph there. Are government restrictions holding back medicine (due to their more onerous regulation), or is medicine on pace with computing? Or do you mean that despite the greater amount of regulation, medicine is already holding pace with computing, and so less regulation would mean even faster innovation?

Posted by: ArC at Nov 12, 2005 10:58:29 PM

"Things have changed drastically up there."

Sandy, by all means, please show me the current numbers of Canadians seeking treatment overseas. I'd like to see them. Old numbers aren't great, but I confess to a bias for large-scale statistics, even possibly slightly outdated ones, over anecdotes and context-free mini-stats.

Posted by: ArC at Nov 12, 2005 11:01:26 PM

ArC,
What I am trying to point out is that you've obfuscated something that is really quite simple. In a free market, items are bought and sold. The prices are set by willing buyers and sellers. If prices are set by any other method, the market becomes distorted, and the usual rules do not apply. Failure is inevitable, though.

Computer technology differs from medicine primarily in that medicine operates in a market that is largely controlled by the government and 3rd party payers. So unlike the freer market characterizing chips and memory, prices do not reflect the choice of the ultimate consumer.

Computers are less unique than you think. You've become lost in the details. The bigger picture is that computers have become cheaper over time for the same reason that most technologies become cheaper over time. It's how a free market works.

And medical care doesn't work precisely because it is not in a market at all, but a very distorted system that tries very hard to resemble a market, but fails repeatedly, on several levels. In short, you're barking up the wrong tree.

Posted by: Kevin F at Nov 13, 2005 1:11:28 AM

"If prices are set by any other method, the market becomes distorted, and the usual rules do not apply. Failure is inevitable, though."

Oil and diamonds are two distorted markets I can think of off the top of my head where failure doesn't seem inevitable. (the actual limit of oil in the ground notwithstanding.)

For that matter, does USDA and FDA regulation of food in the US mean a "distorted market where failure is also inevitable"? I'd say yes, they create distortions (just try and get unpasteurized European cheeses), but no, the very fact of their regulation does not inevitably mean /failure/.

Posted by: ArC at Nov 13, 2005 1:56:13 AM

1.1% ArC. Not overseas - just out of the country.

http://www.fraserinstitute.ca/admin/books/chapterfiles/WYT2005pt1.pdf#

Posted by: Sandy P at Nov 13, 2005 2:14:20 AM

Re: "no, the very fact of their regulation does not inevitably mean /failure/"

Of course it doesn't ArC, and that was not my argument. Red herring.

You were arguing that the products and services in computer technology operated in an economic framework fundamentally different from that found in the economics governing the products and services found in medical care. And this is simply not true.

I'll try to restate. There are only a few basic markets. Either markets are controlled by individual buyers and sellers, or they are controlled by fiat. The latter is far more inefficient than the former (i.e. it 'fails'). Every major economist recognizes this truth, even the left-leaning ones.

The greatest failures have occurred in those governments wholly controlled by the governemnts, that is, communism. In other nations, the degree of failure is directly proportional to the degree of government control of industry.

Computers aren't a special case.

Posted by: Kevin F at Nov 13, 2005 10:30:17 AM

Sorry.
"The greatest failures have occurred in those ECONOMIES wholly controlled by the governemnts,"

Posted by: Kevin F at Nov 13, 2005 10:53:30 AM

The one thing were West-European countries really stand out in comparison to the US is the provision of easily accessible forms of low-cost high-quality "simple" care, such as maternity clinics, family doctors, long-term care, etcetera. The US system overinvests in finding high-tech cures for complicated and rare or non-life threatening ailments and underinvests in basic care, which, I think, partially explains our ridiculously high infant mortality rates given our GDP. This is an area where government investment would be well worth it.

Posted by: Erik at Nov 13, 2005 11:23:09 AM

Re:"...easily accessible forms of low-cost high-quality "simple" care, such as maternity clinics, family doctors, long-term care"

Appearances notwithstanding, I see little evidence this is true. Infant mortality rates in the US are higher than in other nations for numerous reasons that would not improve depite greater access to care (if access were indeed a problem to begin with, which has not been demonstrated).

Infant mortality rates are higher for mothers are adolescents, did not complete high school, are unmarried, or who smoke during pregnancy. Infant mortality is also higher for moms who had no prenatal care, but it is unclear why, given the massive efforts of Medicaid, this access is not used.

Other causes cited: more premature births, more babies with low birth weights, more multiple births, and earlier Caesarian and induced deliveries. The increased use of in-vitro fertilization and other reproductive therapies that result in multiple births are linked to an increased risk in low birth weight among single births. In other nations, such preemies do not get any high tech care, and perish, uncounted in the infant mortality stats (counted instead as miscarriages). Other nations do not spend money on fertility drugs which result in more multiple births. And more US C-sections and induced deliveries are a direct result of lawsuits (CYA).

"Out of approximately 4 million births, 27,977 infants died in 2002, up from 27,568 deaths in 2001. The rate of infant mortality — considered a key indicator of the nation's health — had steadily declined since 1958. Since 1933, infant mortality has declined nearly 88 percent — from 58 deaths per 1,000. A slight upward blip was seen in 1957-58 but rates dropped again." (http://www.ajc.com/news/content/news/0204/12infantmortality.html)

Although the report stated "Black infants are more than twice as likely as white infants to die in the first year of life — a trend continued in 2002. Lack of access to health care and lifestyle factors, such as domestic and economic stress, may contribute to the disparity", it did not demonstrate any lack of access at all. I am unsure poor asccess exists except for lower middle class workers not on Medicaid.

Posted by: Kevin F at Nov 13, 2005 11:47:59 AM

I know this post is not specifically concerning healthcare costs per se, but what about AMA phsyician birth-control? Is this just a fallacy that I have been fed by some of my classical liberal intellectual role-models, or is the AMA actually raising healthcare costs by restricting the number of doctors in the medical field?

Posted by: Jake at Nov 13, 2005 8:17:14 PM

Kevin, I am talking about facilities that do not exist in the US at all, so differential access is not the only concern (although wealthy americans have better replacements). Family doctors that live and work from a regular house nearby patients are a much better and cheaper option for primary care than emergency rooms, which have become the first stop for the non-insured. A community health center that sends parents notification that a baby needs immunization, arranges post-natal care, etcetera. A lot of these simple forms of care are not easily available in the US.

Posted by: Erik at Nov 13, 2005 8:28:14 PM

Re: "Family doctors that live and work from a regular house nearby patients are a much better and cheaper option for primary care than emergency rooms"

I suppose they are.
Why do you think they don't exist in the US already, if the idea is so compelling?
What if doctors or nurse midwives don't *choose* to live nearby? Will you coerce them to do so?

Posted by: Kevin F at Nov 13, 2005 11:28:03 PM

"Of course it doesn't ArC, and that was not my argument. Red herring."

What? You wrote: "If prices are set by any other method, the market becomes distorted, and the usual rules do not apply. Failure is inevitable, though." I took that to mean that markets distorted by regulation were bound to fail.

"it did not demonstrate any lack of access at all. "

If memory serves, the disparity between adult blacks and whites disappears when we consider only those served by VA hospitals*. Or in other words, the evidence in that study suggests black Americans not in the VA system seem to have worse access to medical care.

* http://jama.ama-assn.org/cgi/content/abstract/285/3/297

Posted by: ArC at Nov 14, 2005 3:49:53 AM

To the first responder, Justin:

How exactly do you expect to cut taxes and implement a universal health care system? I am a Canadian citizen and if I were in the top income bracket, I'd have marginal tax rate of approximately 45%. I don't even think you have the slighest clue how much it costs to operate an effective (if possible) universal health care system. Or in other words, how much it costs to give net free (meaning the poor who take more from it than they give) health care to hypochondriacs. And you can't deny that the propsensity to be a hypchondriac increases when there is zero out-of-pocket expenditure necessary.
You dream of something that is impossible.
The problem with the american health care system is not privatization, its insurance.

Posted by: Jeremy at Nov 14, 2005 12:59:01 PM

Kevin, it has a lot to do with incentives and education systems. In most European countries, students can go to medical school at 18, largely financed by the government. The family doctor track is the shortest (usually 6 years + some trainee period afterwards). These people do not become specialists but function very well as gatekeepers and in dealing with small medical problems. For instance, it is pretty crazy that I have to go see my superbly trained primary care physician at the GW hospital when I need a new allergy medicine prescription or have a backache.

Posted by: Erik at Nov 14, 2005 1:08:50 PM

"And you can't deny that the propsensity to be a hypchondriac increases when there is zero out-of-pocket expenditure necessary."

Criminy, everyone says this and I still haven't seen numbers that show this is a significant problem at all.

Posted by: ArC at Nov 14, 2005 9:22:58 PM

It is unfortunate to hear so many lack health insurance. We really need to improve our health care system. Health insurance is a major aspect to many and we should help everyone get covered.

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