The Questionable Authority

If you’re poor, sick, and can’t afford good – or even adequate – health care, it’s your own fault for being poor, and your own problem. That’s the clear message of an editorial that appeared on the National Review’s website yesterday:

Defined at a high level of abstraction, rationing is inevitable in medicine. Not everything that might be in a patient’s best interest can be done in a world of finite resources, and some constraint has to limit his treatment. Thus the left-wing jibe that the market features “rationing by price.”

But there are many good reasons to prefer rationing by price to other forms of rationing, which is why we use it for most products and services. Those reasons are not limited to efficiency, though they include it. The rationing involved in a free market is decentralized, creating more room than a bureaucratic system for people to make different trade-offs. Hence most people do not think of it as rationing at all.

It follows that it is a deep mistake to imagine the wonders of greater government involvement absent rationing. Greater government involvement necessarily means that the government will play a larger role in the allocation — the rationing — of care. In a pure government monopoly, for example, where getting care outside the system was either illegal or only a notional possibility, the monopoly would have to turn down some requests, and so some medical interventions would go undone. Even in a mixed system with a large governmental role, the government’s decision not to pay for a treatment — again, a decision that must inevitably be made many times — will have the practical effect of denying care.

If nothing else, the editorial manages to capture the extent of the ideological gap that health care reform proponents from at least some of the opponents of reform. The editors at National Review clearly view health as a commodity to be bought and sold – as something that you should just do without if you can’t afford to buy it. Proponents of health care reform, on the other hand, tend to believe that it’s self-evident that life and the pursuit of happiness are both much, much harder to secure if you can’t maintain good health.

Comments

  1. #1 Colin
    August 18, 2009

    Another ideological question: is health care a basic human right? I contend it is not basic human rights, but that doesn’t mean a society cannot want them for everyone.

    It seems the majority of the American society wants everyone to have some level of food, water, shelter, and health care.

    Or at least just health care. IMO, the general feeling I get about wanting food pantries and homeless shelters is “not in my backyard”.

  2. #2 military wife
    August 18, 2009

    The poor in this country have access to good medical care. There are free clinics, low cost clinics, and public hospitals that all deliver a high quality product. Poor parents can get pretty much everything their kids need for free (including eye glasses, dental care, and hearing aids…middle class people have to pay out of pocket for such things most of the time.) My mom and a good friend are RNs who worked with poor people (mom at a hospital, friend at a Title 1 school) and the HUGE problem was that many parents couldn’t be bothered to go to the free appointments they set up for the kids to get what they needed. Creating another government agency won’t solve that problem, and it won’t solve the problem of people not using the primary care clinics that are available to them, and thus only seeking medical care from Level 1 trauma center emergency rooms.

  3. #3 Dave X
    August 18, 2009

    I needed to go to a free clinic once, and it took 2 hours after my “appointment” before I could be seen. The lower tiers of medical coverage in the US are not particularly available for use by people with jobs. Take a look at the RAM health fairs.

    Our broken health care system is designed for the benefit of cheap-labor conservatives. If people are disposable enough that they will sleep in a parking lot overnight to get care, they will take jobs that pay less, have less benefits, and less stability.

  4. #4 Colin
    August 18, 2009

    Dave X, so is that an indication of how much society really cares about health care for the poor? If people, in general, cared more [or could care more] then donations would be higher, yes?

    If that’s true, then all the uproar of late about health care reform has little to do with the poor but out of selfishness, yes? I have no qualms about people wanting to make their lives better (and not get royally screwed by an insurance industry with too much power) but these two purposes seem to be confused. I.e., “You want health care reform or you hate the poor and have no soul.” Are people using the poor as the excuse to not expose their own selfish goal?

  5. #5 Scott Hanley
    August 18, 2009

    Health care reform won’t cure the problem of people not taking advantage of their opportunities (and can you just hear Glenn Bleck if medical appointments were made mandatory!). What it’s supposed to do is solve the problem of people who are financially destroyed by illness and injury – which happens even to people who thought they were insured.

  6. #6 Woody Tanaka
    August 18, 2009

    It isn’t so much as an “ideological gap”; it’s that so-called conservatives are simply people who are willing to be corporate tools, religious fools or military fan-boys. If some $$ is to be made by a corporate interest, some power is to be accumulated by religious lunatics or some boyhood GIJoe fantasy is to be played out at the expense of our military, the conservatives happily shill (i.e., whore themselves) for those things.

    You can predict where they’ll fall on an issue based on this principle. They’ll astroturf townhalls across the country to prevent poor people from getting healthcare, supposedly on economic grounds, but won’t say a thing about the massive amount of government money given away to big Agra companies. Why? Because it’s okay if a big corporation is making money off of it, but not okay if some poor person benefits.

  7. #7 bi -- IJI
    August 18, 2009

    Are people using the poor as the excuse to not expose their own selfish goal?

    Well of course, when some middle class guy (who happens to be worse off than Joe the Plumber) gets sick and needs to see a doctor, that is just an excuse to be selfish.

    However, when some filthy-rich guy gets sick and needs to see a doctor, he’s being extremely altruistic and considerate.

    Or something.

  8. #8 Left_Wing_Fox
    August 18, 2009

    Colin: I see it as “Enlightened Self Interest”. A universal system benefits the poor and middle class by ensuring affordable coverage, and to the wealthy as a way of mitigating risks of catastrophic health troubles, reducing the costs of business, and increasing the available workforce. Granted the wealthiest few might take a hit, but should the entire system be geared to the benefit of the wealthiest 1%?

    In return, I benefit from the system that is affordable and available at all levels of income, without the risk of bankruptcy in an accident or serious condition, at a lower cost than in a for-profit system. I do not have to rely on charity, since all people pay into the system, regardless of income.

  9. #9 Dave X
    August 18, 2009

    Colin, certainly if people cared more, donations would be more. The difficult part is the many disconnections between who makes the decisions, who pays, and who gets the benefits. “People in general” and “society” are pretty fuzzily defined, and the disconnections become especially acute with low frequency, high cost events like catastrophic health issues. “People in general” would like to stay healthy, and “society” would probably like to keep its population healthy, but the health decisions are being made by insurance companies, and the people who can influence lawmakers. Individually, health care is cheap as long as the individual is healthy, like any insurable event. You can rely on the free clinics for your health care, as long as you don’t actually need to go.

    In general, I’d prefer we spent our 17% of GDP health care budget on doctors, nurses, hospitals, research, and other items actually good for health, rather than on insurance company and administrative overhead. But the people making the decisions about how the money is allocated are the insurance companies, and earning a big slice of vigorish managing cubicle farms of customer service agents to minimize charges is to their direct benefit. When real individuals inevitably change jobs it filters out pre-existing conditions from the insurable risk pool. And heck, if we spend the same 17% GDP on medical jobs and equipment, it actually goes back into our economy as good high-tech jobs, not low-skill, outsourceable jobs.

  10. #10 Colin
    August 18, 2009

    Left_Wing_Fox: long-term payoff is not something businesses think of often. Now, now, now seems to be the mantra. So I agree that making health care more affordable is absolutely necessary.

    Dave X: this is generally the “problem” I find in arguing health care. “Reform” is much more ambiguous and fuzzy than “society”. Much, much more ambiguous. There are two distinct categories of reform that I see: 1) socialization of coverage (Uncle Sam chips in if you can’t pay); and 2) fixing what for-profit companies have done to care.

    #2 is the definition of what I’m most interested in. I don’t think #1 is a requisite if #2 is done. In fact, #1 doesn’t solve #2 in any way except leverage monopsony/single-payer power.

    How far would things go to fixing #1 if insurance companies only had the power of raising premiums? Cannot inject in any way with decisions made by licensed providers. Cannot *NOT* pay for anything. Cannot preclude on “preexisting conditions”. Etc. Much of the administration is gone. Much of the frustration is gone. Much of the provider-overhead is gone. If a company is paying out more than it has collected on premiums then it better raise it’s rates. It really boils down to “who can pay bills the most efficiently” rather than “who can charge the most and pay the least”. If the insurance companies are cut down then #1 becomes much cheaper to insure uninsured people, yes?

    Really, I think #1 should be left to the states to implement (Har! State’s Rights! Har!). For example, Iowa covers uninsured children (Healthy and Well Kids in Iowa) with family incomes under 300% of federal poverty line (~$53k). This, however, deviates from the rest of my points and questions so I won’t dwell on it.

  11. #11 Art
    August 18, 2009

    Despite what some may say healthcare for the poor is simply not available for, or quite problematic for most. Yes, there are some free clinics. And pretty much all of them are overcrowded.

    The report that “many parents couldn’t be bothered to go to the free appointments they set up for the kids to get what they needed.” is a nice way of saying you have little or no understanding of the problem. Poor people, the majority of who have jobs, face many problems with meeting an appointment.

    Taking a kid to a doctor often means taking at least half a day off work. Work where sick days and family leave days don’t exist and where employers are disinclined to allow time off. Your kid has a ear ache and cries all night so you call around to clinic after clinic to get an appointments. But to take the kid to the doctor you have to take most of a day off and risk losing your job and becoming homeless.

    There is also often the question of child or parent care. If at the last minute a babysitter cancels do you go to the doctor and leave your other kids or disabled parent unattended? Have you ever tried traveling by bus or subway with three or four kids in tow?

    And how do you get there if you don’t have a car? The public transport system is a shambles in most areas. You may have to start off three or more hours before the appointment and transfer two or three times to get to the free clinic. If a bus runs late or breaks down it is entirely possible to miss connections and to miss the appointment. Of course even bus fare may be prohibitively expensive if your budget is tight.

    There is a lot more to getting poor people healthcare than just tossing a tiny underfunded free clinic into a city awash in people lacking healthcare options. It also has to be noted that most free clinics don’t differentiate income levels. A middle class or wealthy family is free to visit them. Rich kids often show up to get birth control pills or have STDs treated without their parents finding out. Fact being that many free clinics see many middle and lower middle class people. People who have a bit of money but still can’t afford to see a regular doctor or get insurance.

  12. #12 Left_Wing_Fox
    August 18, 2009

    How far would things go to fixing #1 if insurance companies only had the power of raising premiums?

    Insurance companies raising their premiums on individuals would effectively deny many people from the service. Paying $500/month for medical insurance just isn’t feasible to a person making $20,000.

    There is a fundamentally coercive element in medicine: You buy the treatment, or you suffer the consequences of the illness, be that disability or death. Insurance is a method of mitigating the unpredictable nature of individual medical emergencies, but the coercive element is still there: buy insurance, or risk making the choice between bankruptcy and death when the accident hits. Along with the highly complex nature of medical services and inelastic prices of effective treatment, that coercive nature is what allows health care providers and insurance companies to resist market pressure on price and profit margins. Companies can charge as much as people are _able_ to pay, and they will, because the option is worse.

  13. #13 Colin
    August 19, 2009

    Left_Wing_Fox: the point of insurance is to spread risk. Setting rates on an individual basis seems to defeat that point for risk that, in general, has little to do with personal choice (unlike, say, car insurance where you choose to drive 20 over habitually). If you play out setting premiums on a case-by-case basis you wholly null and void the purpose of insurance.

    To restate my assertions. If #2 were fixed then I think #1 can be solved/mitigated by socialization. If you make the poverty line (or whatever) then society would help you out if your state opts to do that. In Iowa, we insure our uninsured children.

    I’m not sure of what you’re trying to get at in your second paragraph. Are you trying to persuade the need for insurance? I don’t think it’s necessary to even try. Or you trying to argue against for-profit anything in health care?

  14. #14 Paul Murray
    August 19, 2009

    @2 “the HUGE problem was that many parents couldn’t be bothered to go to the free appointments they set up for the kids to get what they needed”

    You have a car, I take it, and can get time off work when you need it.

  15. #15 Left_Wing_Fox
    August 19, 2009

    Or you trying to argue against for-profit anything in health care?

    It’s more pointing out the inherent risk of a profit model in health care that needs to be mitigated in some form of regulation. As long as the choices to the consumer are “Bad” (i.e. barely affordable insurance sold at massive profit margins) and “Unacceptable” (Bankruptcy or denial of care), then there is incentive for market collusion between providers to charge as much as the economy can support, rather than trying to undercut competitor prices.

    It’s not that there can be absolutely no profit in the venture, but that there is very little downward incentives on profit margins provided by the free market. That lack of market pressure needs to be applied by some form of government pressure.

    In my own mind, this is most efficiently and effectively done by socializing at least the insurance layer. The proposed public option also gives a baseline price against which private corporations must compete, and I feel is a good option for retaining a multi-tiered healthcare market. Without some form of regulatory pressure on profits though, the per-capita costs of healthcare in the US will remain some of the highest in the developed world.

  16. #16 Colin
    August 19, 2009

    Left_Wing_Fox: I’m curious where you draw the line. Which should be excluded from for-profit: insurance, hospitals, large clinics (PC’s), small clinics, emergency rooms/trauma centers, parenting clinics, dialysis centers, basic supplies (needles, gauze, etc.), common machinery (EEG, EKG, dialysis, etc.), specialized machinery.

    Again, the whole thing with “reform” is rife with ambiguity. One of the best care providers is Mayo (and one of the cheapest) and they are non-profit, but their philosophy is almost entirely different from everywhere else. Perhaps the non-profit explains the low cost and the philosophy explains the care quality. I dunno.

    Regardless: Mayo works without socialization in a market that sane people agree needs reform. “Not for-profit” is not the same thing as socialization. (At least to my knowledge Mayo is an independent, non-profit.)

  17. #17 medsearch
    August 19, 2009

    This article is correct. There is no “birth-right” in America that says that every person born (or coming in illegally) in America “deserves” health care! Do you think that the American people of 1776-1900 believed that the government should take care of them if they got sick? If they could not afford to pay, with money or bater, for a doctor’s care, they simply died. At what point did Americans develop this entitlement mentality?

    Learn more about how “Obamascare” will impact the medical sales industry by costing thousands of jobs in medical sales at http://www.gorillamedicalsales.com/blog

  18. #18 Troublesome Frog
    August 19, 2009

    If they could not afford to pay, with money or bater, for a doctor’s care, they simply died.

    Sounds like paradise. I can’t imagine why we would want to live any other way.

    On a related note, what’s up with this trend of refrigerating meat these days?

  19. #19 Colin
    August 19, 2009

    Frog: when do you want to start paying for my new fridge cuz it just stopped working?

  20. #20 Troublesome Frog
    August 19, 2009

    Frog: when do you want to start paying for my new fridge cuz it just stopped working?

    What, your company doesn’t make a tax-privileged refrigerator part of your compensation? If it’s a matter of life and death or serious disability, I can probably chip in a few bucks–especially if Sears has a policy against selling refrigerators to people like you who break theirs.

    The point of my post is that things have changed just a little bit since the founding of our country. For one thing, doctors are now more likely to help you than kill you. For another, we’re *fabulously* wealthy by comparison to people of the late 18th century.

    I don’t think it’s wise for us to limit our public policy options to those of our forefathers because frankly, our forefathers didn’t live very well. We have the technology and the productive capacity to solve a lot of problems that they simply had to live with. Whether or not we do it should be a simple matter of policy, not one of ancestor worship.

  21. #21 Michael Ralston
    August 21, 2009

    the point of insurance is to spread risk. Setting rates on an individual basis seems to defeat that point for risk that, in general, has little to do with personal choice (unlike, say, car insurance where you choose to drive 20 over habitually). If you play out setting premiums on a case-by-case basis you wholly null and void the purpose of insurance.

    Welcome to America! I realize our health-care “system” may look crazy to someone from whatever country you’re from, but let me assure you that just because it doesn’t do what people expect insurance to do, doesn’t mean we can’t call it that here!

  22. #22 acı cehre
    August 22, 2009

    Perhaps the non-profit explains the low cost and the philosophy explains the care quality. I dunno.

  23. #23 acı cehre
    August 22, 2009

    When real individuals inevitably change jobs it filters out pre-existing conditions from the insurable risk pool.

  24. #24 Left_Wing_Fox
    August 31, 2009

    Colin: Sorry about the delay, but I was at a wedding.

    I’m curious where you draw the line. Which should be excluded from for-profit: insurance, hospitals, large clinics (PC’s), small clinics, emergency rooms/trauma centers, parenting clinics, dialysis centers, basic supplies (needles, gauze, etc.), common machinery (EEG, EKG, dialysis, etc.), specialized machinery.

    Answer: _Where_ the price brakes go can be variable.

    On one hand, you could simply force a market cap on profits: No more that X% profits; the remainder goes to the customers. It would be difficult to enforce though, and the fact that it’s being proposed on only one industry might not be constitutionally sound if its argued that it serves much as a bill of attainder.

    A public option would force insurers to compete against a non-profit service, and therefore provide a competitive incentive to keep profits down to more affordable levels. In this model, you could have the entire industry private, with simply a government run option available to all. It’s inefficient, but it works and allows for the wealthy to retain their gold-plated healthcare privileges, while providing everyone with a basic option. This is a good example of how government involvement in a market space can use market pressures to enact change.

    Canada’s universal healthcare system allows a profit margin for private doctors. While many of the hospitals are run by provincial government boards, there are plenty of private clinics as well. This also allows private medical production services to exist (i.e. Pharmaceutical companies and medical equipment manufacturers). It should be noted that some services, like dental and optical, are largely left to private practitioners.

    Britain runs all the hospitals and clinics, but still purchases medical supplies from a private market.

    All of these options have costs and benefits, but right now the argument is dominated by those who refuse to acknowledge there could possibly be benefits to some level of socialization. To that end, even the relatively modest restrictions on industry are lumped in as being as evil or as bad as a public option or universal heath insurance, or a completely nationalized health service.

    My personal opinion is that if the goal of insurance is to spread risk and cost amongst many people, then socialized insurance makes the most sense: In that way, everyone who can contribute does contribute, and everyone is paying for the health care they may one day need. There, clear price controls can be implemented that still allows for-profit practices to exist in a market space to provide choice and competition.

    Again, the whole thing with “reform” is rife with ambiguity.

    Given the number of plans in play in the US, and the number of actual options in the world, that’s inevitable. Right now, the conversation is dominated by those who fear ANY government involvement, and those seeking an actual socialist element (like the proposed public option or the never-seriously-considered universal insurance). Until congress chooses a bill to focus on, It’s difficult to debate the specific policy issues, and the press has been continuously unwilling to help discuss actual policy, as opposed to the politics.

    To be bipartisan about it, if congress proposes a bill that mandates universal health care, but imposes no price controls, I think we’ll have a nice bipartisan failure that we can all agree sucks.

    One of the best care providers is Mayo (and one of the cheapest) and they are non-profit, but their philosophy is almost entirely different from everywhere else. Perhaps the non-profit explains the low cost and the philosophy explains the care quality. I dunno.

    Regardless: Mayo works without socialization in a market that sane people agree needs reform. “Not for-profit” is not the same thing as socialization. (At least to my knowledge Mayo is an independent, non-profit.)

    This is true, but again, I think the major issue here is with _insurance_ rather than actual care. Even if all the hospitals went to a non-profit organization, health insurance still exists in that area between a bad choice and a worse choice; buy expensive insurance or risk bankruptcy, and the costs of bankruptcies will continue to be passed on to the insurance companies who actually pay bills.

    Perhaps if we could go back to a non-profit insurance system, we could get prices back down. But again, I think the best non-profit cost reduction would be universal non-profit health insurance, which is probably best run by an independent public agency.

  25. #25 Eamon Knight
    August 31, 2009

    Do you think that the American people of 1776-1900 believed that the government should take care of them if they got sick? If they could not afford to pay, with money or bater, for a doctor’s care, they simply died. At what point did Americans develop this entitlement mentality?

    One often hears “conservatives” (I won’t judge whether they really deserve the label) invoke the Myth of the Good Old Days — life used to be so great that we should go back to doing things like they did in Grampa’s day. But it’s not often you see someone with the chutzpah to try the opposite argument: that we should deliberately and conciously go back to the days when life really sucked (‘cuz, it’s….good for the soul, or something).

    BTW: my basement still contains a few relics of the days when doctors accepted barter, in pre-medicare Ontario. My wife’s late grandfather was a doctor in a working-class neighbourhood in a steel town, starting during the Depression. He would never refuse to treat a patient — and of course, people were too proud to accept free services. To save face, they would offer him damn near anything in exchange, which he would invariably accept. When we cleared out their house, there were all sorts of crazy things in the basement (the shotgun being probably the wierdest — Zaide didn’t hunt).

    He was overjoyed when socialized medicare was introduced.

  26. #26 jt1
    March 30, 2010

    free clinics what a joke you say you can get your teeth fixed what a joke i want to a free clinic and i ask can you fix my teeth so you don’t have to pull it he said yes i can it will cost you 275 dollars so he had to pull it so don’t say what you don’t know you are on a base we are not