April 14, 2009

"If the graph showed that rising expenditures on computer technology had eaten up all the increase in Americans' paychecks..."

"... would we immediately declare a 'computer cost crisis' and demand that rising laptop expenditures be constrained?"

Kaus on heath care costs.

67 comments:

rhhardin said...

If there was haircut insurance, there would be a haircut crisis.

Third party payments, whether cloaked as insurance or not, always result in mispricing and misallocation of resources, and always take down the standard of living.

Pogo said...

What rh said.

Never in the history of the world have costs been dictated by a government.

It's impossible. Mises and Hayek explained it all long ago.

Trying to fix prices and set controls and plan centrally from the super-smart planners who like to plan things has never ever been able to keep costs from responding to supply and demand pressures.

Expect shortages, reduced quality, queues, denials, strikes, less technology, fewer new medications, doctors who act like every other civil servant, and special treatment for the Favored Ones.

America is going to bed with socialism, and will wake up with totalitarianism. And a band of iron, not gold.

Pogo said...

As to the question
"... would we immediately declare a 'computer cost crisis' and demand that rising laptop expenditures be constrained?"?


Yes, of course we would.

Bart Hall (Kansas, USA) said...

In fact it is rising expenditures on government that have eaten up much of the increase in Americans' paychecks.

I'm self-employed yet manage to obtain quite satisfactory medical insurance for my family for less annual cost than county property taxes alone -- and we live in a very modest 1100 square foot home, built in 1922.

A second example: Our income is quite modest, yet sales tax expenses by themselves are quite a bit more than the cost medical insurance.

When I was a youth in the '50s most families had one breadwinner and the total tax bite might have come to 15% of income. Some data suggest as little as half that amount.

As expenditures on government increased in proportion to paychecks, most families needed a second breadwinner in order to maintain their standard of living.

Eventually, by the 1990s even two earners were insufficient to maintain family living standards, so they turned first to credit cards and then to cash-out refis.

A significant proportion of distal-cause blame for the present economic mess can be assigned to rapid growth of government at all levels, particularly in the '60s, '70s, '90s and '00s.

People in government attempt to blame health care and health insurance costs for family financial challenges ... because it diverts attention away from the primary real cause of such difficulties.

Peter V. Bella said...
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Quayle said...

Trying to control all aspects of an economy - price AND production costs AND quality AND quantity AND availability - has been tried before.

It has always failed - every single time.

As smart as Obama is supposed to be, he apparently doesn't know this simple truth.

Consequently, we're all about to be given a harsh reminder when Obama's policies start to take effect.

Cedarford said...

would we immediately declare a 'computer cost crisis' and demand that rising laptop expenditures be constrained?"?The answer is "yes we would!" As we have, and people in other nations have when some other aspect of household budget spending rises enough to eat away all salary gains or even go past that and result in a sharply lowered standard of living.

Other nations have been rioted into a standstill, even gone a step further into Revolution - over matters like unacceptable food prices, water availability, cost of education, electricity prices, technology that enabled a few to benefit by creating double-digit inflation, or technology that enables HR people to undercut wages of workers to transfer wealth saved from paychecks by setting a "national price" for a software engineer or forcing wages lower by imported H1-B visas - right into the executives hands instead.

Right now in America, people are no longer swayed by the emotional argument that "you can't put a price on life or health or the miracle technology behind keeping badly dehabilitated persons alive and cared for for decades more."
Or the argument that "when it comes to the children! the children! - we can't consider the costs of educating them. We must do as the NEA demands we do..."

As for healthcare, the free market has failed if we pay 40-60% more per capita than Europeans or Asians do under a more rational system - countries where people live longer than Americans. It has failed if it adds 3,000 dollars in cost to each 40,000 dollars of goods we try exporting - an add on that other countries avoid.

And people are realizing it is a prime driver of their taxes, our economic malaise, and why with jobs going and employers cutting back on care benefits - why so many feel their family's health, not just financial health - is now threatened.

Peter V. Bella said...
This comment has been removed by the author.
Peter V. Bella said...

"As smart as Obama is supposed to be, he apparently doesn't know this simple truth."Truth and politicians are antipodal.

Quayle said...
This comment has been removed by the author.
John said...

If the increase in America's wages were going to support the poor would Noah have such a problem? Why does Noah hate sick people?

You want to know why health care costs are high, look at people like my mother. My mother probably never made more the 30K in her life. She did raise six kids so that certainly counts in her favor when looking at her economic productivity. Regardless even if you count the kids, how much value did she produce in her life? A million and a half maybe?

She got cancer for the second time in 2004. She died a year later. In that time, her medical bills had to be over a million dollars, almost all of which was paid by medicare and private insurance. Was it efficient to spend a million dollars on a 67 year old woman with a deadly form of cancer in its advanced stages? No it wasn't. But I at least believe it was the right thing to do because I do not want society to get into the business of casually deciding whose life is worth saving and whose life isn't. I would rather absorb the higher medical costs and be poorer but live in a world where if doctors think a treatment has a chance at working you get it rather than being told no because you are too old or too sick or don't fit the profile of who deserves care.

In the end, that is the system that evil twits like Noah want. They want a system whereby the government tells the old and the sick to go die or better yet kill themselves. Noah really is scum. But, like all devils he doesn't come out and say he wants to kill the sick. He comes in as your friend wanting to help the people afford health care. Crapweasel.

Quayle said...

Cedarford said, As for healthcare, the free market has failed if we pay 40-60% more per capita than Europeans or Asians do under a more rational system - countries where people live longer than Americans.OK, Cedarford, I’ll bite. You throw out these measures, but they mean nothing in pure space. This conversation can never go forward until we standardize the metrics and get to the heart of the issues of in what way and why we're paying more.

Let me demonstrate by showing some of the issues that nobody talks about clearly:

First, do we have a health care unit cost problem or a health care total expenditure problem?

Decrying that we’re paying more per capita is silly if we get more health care service for those additional payments.

If Americans pay more pure unit of health care – i.e. more for each aspirin and more for each x-ray – is it because America is subsidizing the world by paying the lion’s share of ROI on the healthcare technology R&D investments. My guess is that we are.

Alternatively, we could be paying more per aspirin and x-ray because the person that administered that procedure is living in a nicer house than their counterpart in Europe or Asia (i.e. we pay our nursing and technical staff more money.)

Is that a healthcare cost problem, or a result of America’s overall higher standard of living and our willingness to not begrudge our healthcare workers of living in the middle class?

On the other side, if we have a total expenditure problem – i.e. we’re paying for things that are not making us live longer – then that is an education problem, not a healthcare cost problem, and we need educate the public to stop paying for those things that have a low marginal return.

(Coming up with an expenditure to wellbeing metric is much harder because ‘wellbeing’ is very subjective in each culture.)

You get the point – this problem can’t be addressed by simply labeling it a “health care cost problem.”

John said...

"On the other side, if we have a total expenditure problem – i.e. we’re paying for things that are not making us live longer – then that is an education problem, not a healthcare cost problem, and we need educate the public to stop paying for those things that have a low marginal return."

That usually involves killing old people. What is the marginal return on medical care for a 78 year old retiree that allows him to live another 5 five years? Is it an education problem that we would like Grandpa to live another five years? Is it the problem that we just are not craven enough to weed out the sick and the old fast enough?

Maguro said...

I wonder how the threat of malpractice lawsuits has affected our healthcare costs compared to other countries. Even if we eliminated the insurance companies and made the gov't the sole provider of health insurance, we'd still have to deal with this.

I don't know about Europe, but in Japan there are strong cultural mores against lawsuits in general and medical malpractice suits in particular that probably help keep costs down.

AJ Lynch said...

These healthcare statistics that claim Americans spend way more per capita - do they include all the face lifts Joan Rivers has had?

If so, I suggest a re-count.

J said...

"if we pay 40-60% more per capita than Europeans or Asians do under a more rational system - countries where people live longer than Americans"

To take one of your examples, it's not clear that Asians, and let's be specific and say Asians who happen to be Japanese and presumably have the highest life expectancy in the world, live longer than Americans.

That assertion is based on life expectancy at birth, a stat that is hugely influenced by an inconsistent, self defined and reported statistic, namely infant mortality.

When you look at life expectancy at 40 years old, an age where arbitrary definitions of what constitutes a live birth no longer apply, a Japanese male's life expectancy is .9 years less than an American male (http://www.ncbi.nlm.nih.gov/pubmed/17420610, http://www.retireearlyhomepage.com/lesafe.html).

X said...

If they has only socialized medicine and nationalized Big Pharma in 1950 think how much we would be saving on procedures & drugs that wouldn't even exist.

John said...

The lifespan of Americans has a lot to do with things that have nohting to do with the healthcare system. No healthcare system is going to keep young black men from killing each other at such a rate. No healthcare system is going to prevent people from abusing drugs. No healthcare system is going to change the fact that the US has ethnic populations that are genetically predisposed towards illnesses such as diabetes.

When socialists site the lifespan of Americans and compare it to socialized countries, they are comparing apples and oranges.

Henry said...

John, with all respects to your loss, please consider the following.

You say that part of the cancer treatment costs for your grandmother were paid out of private insurance and part out of medicare.

Would you be comfortable with a system where all costs were paid out of private insurance (or out of pocket)?

If yes, then I think you can stand on principle and we can argue the justness of that principle.

If no, you have to consider the problem of allocation. That medicare money did not have to go to cancer treatment. It could have gone to prenatal care, or pharmaceuticals, or pure research. Some of these options might actually save more lives than treatment.

Or the money could have gone less to treatment and more to caregivers. That too might actually save more lives than treatment.

Or the treatment could be top notch, but the patients stay in group wards. That could allow more people to be treated.

John said...

"If no, you have to consider the problem of allocation. That medicare money did not have to go to cancer treatment. It could have gone to prenatal care, or pharmaceuticals, or pure research. Some of these options might actually save more lives than treatment."


First you assume that we are not already spending money there and that additional money would actually do some good. We spend a tons of money on pre-natal care in this country. It is not at all clear that spending more money would do any good.

Further, examine the underlying assumption behind your statement; that one life is worth more than another and worthe spending money on. Why should we spend money on old people with cancer when we could spend it elsewhere? Look at where that thinking takes you. If it is not worth spending money to save old people, why is it worth spending money to save the handicapped? Is someone with a 70 IQ and in a wheel chair who will never work productively worth spending even a dime on? Why even give them an asprin? It is not like they will ever do anything for society to earn it back.

Now the response is that it should be his parents who pay for his healthcare. Well, in a private system they do. I get health insurance and pay more for it so that if one of my children turns out handicapped I can afford medical care. If it is government insurance it is the same principle. We all pay more when we are young and healthy so that we can get care when we are old and those who are not productive can get care to. Why is that such a bad thing.

Your arguements are a road to hell. Once you start thinking in terms of lives and efficiency, you inevitiably end up deciding who is worthy of living and who is not. You are kidding yourself if you think men are capable of doing that without it resulting in just killing off the old, the weak and the different.

Dave said...

Whenever Kaus wades into economics, I cringe. Without taking a position either way on the issue of 'universal' healthcare, there is an obvious difference between healthcare and computers. The former is (mostly)a necessity, the latter (mostly) a luxury. That would explain why many are alarmed at the ever increasing costs of healthcare.

Henry said...

John, if you think decisions that trade-off lives aren't being made now, in our current system, you are fooling yourself.

Even if one accepts the status quo system you describe -- mostly private insurance for the young, some public coverage for the old -- policy decisions are explicit.

Who gets an organ transplant? Which hospital has the best surgeons? What are the success percentages for surgery for a 70-year-old man vs. an 80-year-old woman? What kind of treatments should be covered by medicare? What about pharmaceutical benefits?

All of these decisions have life and death implications, and they are all being made now -- by health plans, by hospitals, by the government.

One way to avoid the implications of this fact is to embrace confusion. I'm not saying that as necessarily a bad thing. There are advantages to ad hoc decision making and distributed responsibility.

Actuarial decisions making won't go away. If you argue that acturial thinking shouldn't be centralized -- there you might have an argument.

prairie wind said...

Think of the procedures that we do routinely: PAP, colonoscopy, mamogram, for example. We do them because it is considered preventive care--it will prevent us from becoming more expensive to care for, right? Catch breast cancer early and everyone saves money in the treatment costs. The problem is that if I am providing mamograms, I make more money when every woman starts coming to me for an annual mamogram. And why wouldn't every woman do that when insurance pays for it? In fact, insurance companies encourage those routine tests...and the price of those procedures continues to rise.

On the other hand, look at eye surgery like LASIK. The cost for those procedures has gone down, not up. Why? Perhaps because most of us pay for those procedures ourselves--insurance doesn't cover them.

Put people closer to the cost of medicine by removing the insurance cushion and I'll bet we'd see a decrease in cost.

Another reason for more expensive medical care is the number of people employed to keep track of insurance.

John said...

Henry,

Those decisions are not made on an acturial basis. If they really were made on that basis, doctors would not just look at the survival rate but at the productivity of the person involved.

Do we make decisions? Yes. But we make them based upon the chance the person has of surviving and benefiting from the care not what we judge the value of the person's life. There is a difference. We don't consider that the 78 year old will never work another day in his life if he survives. We only look at whether the treatmetn has a legitimate chance of exetending his life in a meaningful way.

Pogo said...

The key difference is who makes the decision.
.

If it's not you, then it's either a government employee you cannot vote for, or an insurance exec. The former is even more ruthless than the latter.

Hoosier Daddy said...

I wonder how many people know what the Medicare budget is and how many Medicare beneficiaries are currently covered.

The 2009 Medicare budget is roughly $420 billion. As of 2008 there were 44.8 million Medicare beneficiaries. Now if we want to add the rest of the nation to those rolls to achieve universal coverage I'd really like to know where the money is coming from.

Pogo said...

" I'd really like to know where the money is coming from."Quite seriously, the gummint-payer types believe we will simply convert our work-based benefits and private insurance payments over to the them.

And they actually believe employers will continue to pay you that money as part of your salary, but now it is a tax.

And they believe we won't be able to tell the difference between a tax and a benefit.

And it will cost less.

And ponies will crap marshmallows.

Hoosier Daddy said...

Quite seriously, the gummint-payer types believe we will simply convert our work-based benefits and private insurance payments over to the them.Interesting. I'm sure that will go over big with those who think that it was going to be free.

former law student said...

That usually involves killing old people. What is the marginal return on medical care for a 78 year old retiree that allows him to live another 5 five years? Dude, the wageworkers of America are already paying for that 78 year old's health care. Whatever dire form of rationing you fear is already going on -- or not.

The 2009 Medicare budget is roughly $420 billion. As of 2008 there were 44.8 million Medicare beneficiaries.Each younger person insured will cost less than does a Medicare recipient. As I recall, the biggest expense for one's health care is during the year before you die. The Medicare set contains the lion's share of dying people.

As a practical matter, if you make it to adulthood you have a great chance of living till age 40 without significant medical intervention. People start to croak from 40 on, and thus need more medical care in proportion. Look at any health insurer's rate card to see this.

AJ Lynch said...

The DEMS do not want to give health insurance to those without it.

They want to control all of us by bestowing universal health care on everyone.

Bless their cost-containment little hearts but it won't work.

AJ Lynch said...

Hoosier:

Let's say we could insure the uninsured for 25% of what it costs us to insure old, aged, decrepit Medicare patients which is about $10,000 per year.

So we take 25% of that or $2,500 and send a check every year to the 45 million uninsured. That will cost us about $110 billion per a year.

Any chance that would satisfy the whining liberals and get them to STFU?

former law student said...

Bless their cost-containment little hearts but it won't work.Of course not. No country has ever had tax-supported universal health care -- why should we be the first?

John said...

Former Law Student,

Try re-reading my posts. I don't think you understood any of them. I know you are a liberal and the big words were probably too much for you but give it a shot. Turn off the daily show, read a book once in a while and try to avoid using the term "Dude" when it is not attached to the word "ranch".

PatCA said...

"For the true spending hawk, I see no practical alternative to the "socialist" public option."

Or just buy everybody a little Smart car.

Hoosier Daddy said...

So we take 25% of that or $2,500 and send a check every year to the 45 million uninsured. That will cost us about $110 billion per a year.

Any chance that would satisfy the whining liberals and get them to STFU?
Doubtful since $2500 doesn't go far if you need a knee replacement.

No country has ever had tax-supported universal health care -- why should we be the first?Because a good chunk of the univeral health care proponents don't know any better and think the money just comes out of thin air. Or we just print more like we're doing now.

former law student said...

I don't think you understood any of them.Hmmm... Somebody named "John" typed:
They want a system whereby the government tells the old and the sick to go die or better yet kill themselves.I'll try to keep it simple: We can have a tax-funded health care system that won't make Grampa die in a ditch because we already have one.

former law student said...

Any chance that would satisfy the whining liberals and get them to STFU?Doubtful since $2500 doesn't go far if you need a knee replacement..

.
First, what the heck happened to our carriage returns?

Second, all health insurance involves making other people pay for your health care. The healthy subsidize the well.

Similarly, collision insurance makes other people pay to repair your sheet metal damage.

Pogo said...

"Similarly, collision insurance makes other people pay to repair your sheet metal damage.".
And no-fault caused insurance rates to skyrocket because of the same problem that affects health care.

Hoosier Daddy said...

Second, all health insurance involves making other people pay for your health care. The healthy subsidize the well.Actually that's generally pretty much how all insurance works.

We can have a tax-funded health care system that won't make Grampa die in a ditch because we already have one.Well the ugly fact of health care is that on average about 80% of your lifetime medical costs are going to occur during the last 10-12 years of your life. Now when the 20 somethings who will be expected for fork over a good portion of thier paycheck for Grandma Moses' hip replacement while they wait 3 months to see thier doc for a checkup then we'll see how many think it's a great plan.

Marcia said...

Quayle said: "On the other side, if we have a total expenditure problem – i.e. we’re paying for things that are not making us live longer – then that is an education problem, not a healthcare cost problem, and we need educate the public to stop paying for those things that have a low marginal return."

To which John replied: "That usually involves killing old people. What is the marginal return on medical care for a 78 year old retiree that allows him to live another 5 five years? Is it an education problem that we would like Grandpa to live another five years? Is it the problem that we just are not craven enough to weed out the sick and the old fast enough?"

It doesn't mean killing old people. Quayle specifically said "things that are not making us live longer."

It can be things like convincing people to quit using (and doctors to quit prescribing) antibiotics for viral infections. Or convincing people with back pain that losing 30 pounds is often a much better solution than pills.

Reduce the use of emergency rooms for non-emergencies. Educate people on the benefits of annual physicals and immunizations.

Pogo said...

"Educate people on the benefits of annual physicals and immunizations."But those simply increase costs, when all costs are considered, because living longer is quite a bit more expensive than dying young. The benefits are entirely personal, not societal.

If you kill people upon retirement, that's the cheapest method of all, and maximize the benefits to society.

AJ Lynch said...

Hoosier:

I intended that they take the $2500 and buy insurance. Infortunately, the libs would still not STFU.

They would say wa wa wa that does not cover acupuncture, or herbal massages or chiro or I have a co-pay. Wa wa wa.

pete-who said...

I'll try to keep it simple: We can have a tax-funded health care system that won't make Grampa die in a ditch because we already have one.Your argument is inconsistent. You suggest we need more government health care because the current system is bad, but then, to show that government health care works, you say that our current system is working.

Hoosier Daddy said...

I intended that they take the $2500 and buy insurance. Infortunately, the libs would still not STFU.

They would say wa wa wa that does not cover acupuncture, or herbal massages or chiro or I have a co-pay. Wa wa wa.
.
.
Well in fairness, that stuff most likely won't be covered under a universal pay system either.

Believe it or not, France has the best full coverage system out there mainly because of price controls. It's pretty close to our Medicare system in which the state pays for most of the costs where the individual can then purchase private insurance to make up the difference much like our Medicare supplement system. It works for the most part due mainly to the price controls set in place. Then again we have price controls here too. Medicare allowable amounts and then you have insurance companies who will negotiate a set price as well.

I'm convinced universal health care is an inevitability simply due to the massive costs inflicted on employers who fund damn near 80-90% of the costs. It will just get to a point where the employer just says sorry, can't afford to pay your health costs. Or yes we'll pay those costs but you just make oh, say $8-9K less in salary. You pick.

Hoosier Daddy said...

One more thing, while I'll agree that France has a pretty good system in place, they're also facing a budget problem as well and will need to reply on an expanding younger generation to pay for that greatly expanding older generation who guess what, consumes a greater proportion of medical costs.

Only problem is France like most of Europe isn't procreating therefore are leaving an ever greater percentage of the existing 'youts' to foot the bill. And those 'youts' are being replaced by an ever expanding population of other 'youts' who I doubt very much have the health interests of aging Frenchmen at the top of thier agenda.

But that's a topic for a different thread.

Joe said...

Suggesting we change how we care for the elderly isn't "killing" them off. It's a rational response. When my grandfather had his last heart attack, because of they hysterics of other family members the ambulance showed up and resuscitated him despite an DNR--he then wasted away for several weeks before finally dying. That freaked my grandmother out so much, she was adamant about not being cooped up in a hospital and at the end, died at home with a nurse caring for her.

Artificially extending life for the terminally ill is not compassion or moral. It's the action of people irrationally frightened of death.

The argument that this is a slippery slope totally ignores that this argument is its own slippery slope--where do you draw the line? An extraordinary number of people could be kept alive in the strictest biological sense through artificial means, but is this desirable?

My first son was born very prematurely. We were faced with a decision as to letting nature take its course or insist on heroic measures being taken. At the time, no baby within a month of his maturity had survived. To do heroic measures would have been extremely cruel and selfish. So we chose the former. He lived an hour and a half.

former law student said...

I'll try to keep it simple: We can have a tax-funded health care system that won't make Grampa die in a ditch because we already have one.

Your argument is inconsistent. You suggest we need more government health care because the current system is bad, but then, to show that government health care works, you say that our current system is working.
I don't recognize that as my argument. My argument is that if tax-funded health care meant draconian care rationing, we would be seeing it with Medicare patients, who are the biggest per capita consumers of health care.

former law student said...

he then wasted away for several weeks before finally dying.Not to remind you painfully of your losses, but this reminds me that paying for long-term care is yet another issue. Health care is meant to fix you up and set you going again. If your physical and/or mental condition is such that you can't care for yourself, that care -- even in countries with universal health care -- comes from a different pocket. In most countries even now families provide the equivalent of nursing home care and hospice care.

Hoosier Daddy said...

My argument is that if tax-funded health care meant draconian care rationing, we would be seeing it with Medicare patients,.
.
Um, no because Medicare patients are 44.8 million of 300 million Americans. Add that remaining 255 million to the rolls and lets talk.

Quayle said...

We'll never solve these issues unless we clear up the godian's knot of thinking on the issue.

There are three pieces to this puzzle: (1) the unit cost of a healthcare procedure, (2) the probabilistic cost of fixing a health care problem, and (3) - NOTE, THIS IS ENTIRELY UNRELATED TO THE OTHER TWO - the per capita cost of being a memeber of a risk sharing pool.

A few preliminary points: Those that say that America doesn't have socialized medicine right now are wrong. We have private risk sharing pools (i.e. insurance) that socializes the individual pool-member's risk of having a huge medical expenditure.

Further, any time I ask another person to help sholder some of the risk I face, that person has a right to comment on my actions that may increase their agreed-up burden.

Can we agree on these points so far?

Bruce Hayden said...

On the other side, if we have a total expenditure problem – i.e. we’re paying for things that are not making us live longer – then that is an education problem, not a healthcare cost problem, and we need educate the public to stop paying for those things that have a low marginal return.Or, maybe they are paying for quality of life. Both my parents got knee replacements (curtesy of the taxpayers via Medicare). My mother got better than a decade of hiking out of both of hers before succumbing to ovarian cancer. My father's knee is about 15 years old, and allowed him at least an extra decade of skiing.

Contrast this with the Canadian system, where one of our skiing guides had to go to India to get a hip replacement, because the wait in Canada was at least a couple of years, and he needed the operation in order to continue his occupation.

Bruce Hayden said...

The problem with talking about whether spending money on preventive care is better than spending it on end-of-life, etc. care, is that it is completely irrelevant when it comes to socialized medicine.

Why? Because in the end, the decisions on what is covered and what is not will ultimately be almost completely political. The old vote more than the young, so it is natural that there will be more a lot of end-of-life care, plus hip replacements for 90 year olds. Gays scream a lot, so a lot of money will be spent on AIDS. Women whine more about themselves than men do, so there will be much more money spent on breast, ovarian, etc. cancer than on prostate cancer. The Baby Boomers are going through loss of sexuality right now, so there will be money spent on Viagra, etc.

This is just the natural result of government control. Even if the smartest people in the world could devise a perfect system (and the smartest people in the world will be gaming it instead), it will invariably break down in short order, when special interest groups scream, lobby, and contribute money to campaigns in order to get their pet cause covered.

At first it looks harmless. Who cares if chiropractors are covered? It will only cost a little bit. Ditto for sexual rearrangement surgery. Hypnosis. Aroma therapy. Etc. But all of sudden, all these extras together have swamped any potential savings many times over.

Bruce Hayden said...

Also, keep in mind that the figures shown for Medicare are the direct payments, and not the indirect costs. Currently, the rest of the health care system is massively cross-subsidizing Medicare (and Medicaid). The sort of "savings" being extrapolated from those programs from price fixing, etc. just won't happen, because there won't be anyone left to cross-subsidize the costs.

Right now, there are a lot of procedures for which Medicare reimburses below cost to the health care providers. Why don't they then just refuse to treat Medicare patients? Because they can't. Physicians were doing just that, and law was made to prevent most of that.

Lance said...

My argument is that if tax-funded health care meant draconian care rationing, we would be seeing it with Medicare patients, who are the biggest per capita consumers of health care.
True we're not seeing "draconian" rationing, but we are seeing rationing. Medicare doesn't cover many drugs and procedures.

More importantly, though, Medicare avoids rationing through price controls. The gap between government-mandated prices and free-market prices are borne by the rest of us non-Medicare health care consumers. (Of course the insurers and HMO's try to control prices in the same way as the government, but they're not the government).

Once you extend Medicare to everyone and mandate all prices, you don't have any more Peters to pay Paul. Except for the taxpayers.

To put it in Quayle's terms, Medicare patients enjoy lower relative unit costs. But you haven't changed total expenditure (an aspirin costs what it costs, regardless of what the government says). Thus everyone else has increased unit costs, to make up the difference between Medicare-controlled prices and real prices. Adding a Medicare-style program for everyone shifts costs from (mostly) employer-paid plans to government-paid plans, but once again doesn't do anything about total expenditure, unless you introduce rationing.

(Kaus is arguing that a national health plan would eliminate marketing and administration costs, which would lower total expenditure. I think that's true but I think he overestimates the amount, and introduces new costs associated with government bureaucracy.)

Hoosier Daddy said...

Right now, there are a lot of procedures for which Medicare reimburses below cost to the health care providers. Why don't they then just refuse to treat Medicare patients? Because they can't. Physicians were doing just that, and law was made to prevent most of that..
.
I don’t believe that’s accurate. Physicians can choose to opt out of Medicare but they must notify all their existing clientele as well as new patients that they don’t accept Medicare reimbursement. In fact, an increasing number of physicians are doing just that simply because they believe that the reminbursement rates Medicare provides are insufficient.

Ignorance is Bliss said...
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Ignorance is Bliss said...

Without taking a position either way on the issue of 'universal' healthcare, there is an obvious difference between healthcare and computers. The former is (mostly)a necessity, the latter (mostly) a luxury.I disagree. Most healthcare is a luxury. It could only be considered a necessity if you believe living as long and healthy a life as possible was a necessity. Clearly nobody believes that, because nobody lives their life that way.

For example, people drive places that they don't absolutely need to go, such as 500 miles to visit a new boyfriend. Such choices increase your chances of dying in an accident. They are also the choices that make life worth living!

Of course, anyone is welcome to spend as much of their own money as they want on their own healthcare. However, don't tell me I'm obligated to pay for your healthcare because it's a "necessity", while you risk your life doing things that are luxuries.

Beau said...

Contrast this with the Canadian system, where one of our skiing guides had to go to India to get a hip replacement, because the wait in Canada was at least a couple of years, and he needed the operation in order to continue his occupation.This is the one downside to universal health care in Canada. However, his provincial health care plan likely covered the medical costs of the hip replacement which would be at a lesser cost due to it occurring in India.

Earlier up the thread you claim that the decisions on what is covered and what is not will ultimately be almost completely political This is a consistent bogyman argument on this site that is incorrect. Not to say it won't happen in the US, but this is not so in Canada. Waitlists for non emergency treatment is the issue here, not whether or not one receives the treatment.

Freeman Hunt said...

I nominate Cedarford as the official spokesman for government intervention into healthcare.

Pogo said...

"the decisions on what is covered and what is not will ultimately be almost completely political ..... This is a consistent bogyman argument".
Bullshit.
If the decisions are not based on the market, then on what?
Science?
When has science ever been apolitical?
It's the gummint. It's nature is political.
It cannot be apolitical.
Cannot.
Impossible.


Expecting otherwise suggests you are overly credulous, and I have some excellent investment opportunities for you: unclaimed Nigerian lottery winnings.

Beau said...

When has science ever been apolitical?I'm talking about boots on the ground healthcare. I've yet to even hear of a situation where the prescribed treatment was made by anyone other than healthcare team, or to hear that the prescribed treatment involved anyone other the medical team or family.

It's the gummint. It's nature is political.That's where you are wrong but never want to see it could be otherwise. My tax dollars, or the govt. if you insist, subsidize my monthly health care benefits cost, only. The government has no say in my treatment. My physician is self employed, receiving no direction from anyone regarding my care. If I need hospital care the hospital operates independent from government, though is funded by the government. I understand that an American may find this impossible under your system but it can and is done this way in other countries.

Expecting otherwise suggests you are overly credulousWell, as I've explained it's not only expected but actually occurs with regard to treatment. However, govt influence does factor into the mix with regard to regional funding causing waitlists. this can be gotten around by being admitted through ER if the situation becomes an emergency. It's not a perfect system because of this but no-one dies because they have a critical/terminal illness and no health insurance as is becoming the case in the US.

No Nigerian scams but I did receive a letter by regular mail the other day telling me I'd won a lottery in Spain. All I had to do was fax my banking information and wallah!, the money was mine. Apparently, this is really working with elderly people who don't have computers and and are more likely to believe a letter arriving in the mail. I know my 99 year old mother would mail the requested information in a heartbeat.

Pogo said...

"I've yet to even hear of a situation where the prescribed treatment was made by anyone other than healthcare team, or to hear that the prescribed treatment involved anyone other the medical team or family.You're a fool.
The British NHS has the worst cancer treatment outcomes in Europe precisely because bureaucrats limited available diagnostic methods and treatments.

Criminey.
Waste of time.

Beau said...

You're a fool.Your the fool for not wanting to believe that it's possible for quality govt subsidized medicine. You want only to believe it can't work and you're not interested in being told otherwise. I don't understand a mindset that is so closed and scared of a concept that would provide, managed, less expensive, healthcare to all of it's citizens.

The British NHS has the worst cancer treatment outcomes in Europe precisely because bureaucrats limited available diagnostic methods and treatments.I seriously doubt the US plan will in any way model the Brits.

Blimey.
Stunned wonder.

Bruce Hayden said...

Beau

It appears that your contention is that under the Canadian system, the physician controls the delivery of health care EXCEPT that there are long waiting lines for anything that is expensive and not an emergency.

But that itself is a contradiction. What do you do for the years that you wait for your hip replacement? That sure doesn't appear to me to be the physician controlling the delivery of health care, but rather, the government rationing it.

Then there is the question of why do so many Canadians come down to the U.S. for health care. They have free health care back in Canada. What is going on there? Why pay money for health care in the U.S. when it is free back home?

Finally, as to your suggestion that in Canada, allocation of health care resources is not done at all politically, I frankly do not believe it. But, even if it is true, I think it unlikely in this country. Maybe Canadians are just that much nicer than those d*** Yankees.

We have seen it time and time again in this country. We see it with Medicare. We see it at the state level with their mandates. And we even see it in the health care component of automobile insurance.

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Pogo said...
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Pogo said...

Beau, your ignorance of how Canadians politicians, sports figures, movie stars, and the monied elite routinely skip over the queues the proles have to use is astonishing but consistent with your religious view of socialism.