Health Care Debate, part Three

I dislike fisking as a literary style, but it does have its
place.  This is one of them.  As noted in the two
previous posts, href="">(Part
One, href="">Part
Two) some authors from the Cato Institute managed to get an
opinion piece published in the LA Times:  href=",1,6553974.story?ctrack=2&cset=true">Universal
healthcare's dirty little secrets
.  In
Part One, I reviewed some of the conceptual distinctions that are
common sources of muddled thinking in the debate over health care
reform.  In part two, I just made a couple of general rants.

Now, in Part Three, I will examine the article and point out some of
the flaws in the author's arguments.

they tack
left and right state by state, the Democratic presidential contenders
can't agree on much. But one cause they all support — along
with Republicans such as former Massachusetts Gov. Mitt Romney and
California's own Gov. Arnold Schwarzenegger — is universal
health coverage. And all of them are wrong.

This is actually the biggest problem I have with their article.
 If all you read is this, you will have gotten most of what I
have to say.  First of all, they all propose various fixes to
the health care system, but it is a mistake to lump them together, even
if most of them are wrong.  Many of them are wrong, because
they propose universal coverage without going to a single-payer system.
 Without going to a single-payer system, the costs would be
prohibitive.  Kucinich proposes universal coverage and a
single-payer system, which is different than the others.   So
don't lump him in with the rest.

Second, the entire article is devoted to pointing out style="text-decoration: underline;">potential
problems with universal coverage in the USA.  I underline
"potential" because is is possible that these problems would not occur,
with proper planning and a lot of political will.  

The thing is, it is easy to find potential problems with any proposed
solution.  Simply finding problems does not mean that the
proposal is wrong.  If they all have problems, there still
could be a correct choice; it would be the one with the fewest

All the authors do is throw darts at universal coverage.  They
do propose some vague reforms, but make no effort to show how those
proposals would stack up against any of the proposals for universal
coverage.  Without
a point-by point comparison, the entire article is meaningless
 If you point out the flaws in the opposition, then present
your own plan without any discussion of style="font-style: italic;">its flaws, you have
not presented a meaningful analysis.

politicians and many other Americans fail to understand is that there's
a big difference between universal coverage and actual access to
medical care.

saying that people have health insurance is meaningless. Many countries
provide universal insurance but deny critical procedures to patients
who need them. Britain's Department of Health reported in 2006 that at
any given time, nearly 900,000 Britons are waiting for admission to
National Health Service hospitals, and shortages force the cancellation
of more than 50,000 operations each year. In Sweden, the wait for heart
surgery can be as long as 25 weeks, and the average wait for hip
replacement surgery is more than a year. Many of these individuals
suffer chronic pain, and judging by the numbers, some will probably die
awaiting treatment. In a 2005 ruling of the Canadian Supreme Court,
Chief Justice Beverly McLachlin wrote that "access to a waiting list is
not access to healthcare."

Oh, where to start?  How can they say that "these politicians
fail to understand..." Who knows what they do and do not understand.
 Probably they do understand that insurance alone is not a
guarantee of access to health care.  You have to have enough
providers or the right kind, in the right places, and have enough
compensation to keep them at their jobs with sufficient morale.
 These points are pretty obvious, and I see no reason to
suppose that "these politicians" do not understand that.  

Furthermore, it is not helpful to present isolated statistics, taken
out of context, and without providing references, in order to build a
case.  Take for example the quote from Chief Justice Beverly
McLachlin.  Usually, court rulings pertain to a specific case.
 Without context, we have no idea if she is making a sweeping
condemnation of the system, or referring to a single instance of a
problem.  Plus, although Chief Justices generally are held in
high regard, they may not be the best source of information regarding
health care policy.

Or, look at the statement about the experience in the UK: "
face="Helvetica, Arial, sans-serif">shortages
force the cancellation of more than 50,000 operations each year."
 what operations are they?  Were they really
necessary to begin with?  Might it be the case that it would
not have been cost-effective to perform those operations?
 That is, would funding those operations provide a bigger
impact on health outcomes, than could be achieved by spending those
funds elsewhere?  And when they refer to a "shortage," what is
it that is in short supply?  Hospital facilities?
 Surgeons?  Nurses?  Additional funding may
or may not be able to solve those problems.  If more money
could solve the problem, why are the funds allocated the way they are?
 Perhaps there is a good reason.

universal coverage fear that people without health insurance will be
denied the healthcare they need. Of course, all Americans already have
access to at least emergency care. Hospitals are legally obligated to
provide care regardless of ability to pay, and although physicians do
not face the same legal requirements, we do not hear of many who are
willing to deny treatment because a patient lacks insurance.

It is not true that all Americans have access to emergency health care.
 Many href="">emergency
departments are understaffed and overwhelmed, with long
waiting times.  Plus, when Americans get emergency care they
can't pay for, they still get billed for it.  It shows up on
their credit report as bad debt.  Or they put it on a href="">credit card,
and fall farther behind.  This is one of the things that makes
it harder for them to achieve economic opportunity, advance their
economic position, and get to the point where they could get their own
insurance.  In other words, it is one of the reasons that the
poor get poorer.

It is estimated that href="">50%
of bankruptcies are related to health care expenses.
 So even if people do get the care, the lack of universal
coverage still has profoundly negative consequences.  When
bills go unpaid, it hurts the economy and everyone is affected.

As for the last statement, no we do not hear of many physicians who
deny services for lack of insurance, but there are many, if not most,
who expect to get payment of some sort.  Even if they are
willing to do some pro
work, they will, of necessity, limit it to a small
part of their overall practice.

Many physician offices are expensive to operate.   href="">Overhead
costs of 50% are common.  So seeing patients for
free is not just lost income, it actually costs the doctor money to
provide free care.  
face="Helvetica, Arial, sans-serif"> In
fact, many doctors will not take Medicaid patients, even though they do
have insurance.  The reason is that the reimbursement, in some
cases, is so low that the physician cannot afford to see Medicaid

may think
it is self-evident that the uninsured may forgo preventive care or
receive a lower quality of care. And yet, in reviewing all the academic
literature on the subject, Helen Levy of the University of Michigan's
Economic Research Initiative on the Uninsured, and David Meltzer of the
University of Chicago, were unable to establish a "causal relationship"
between health insurance and better health. Believe it or not, there is
"no evidence," Levy and Meltzer wrote, that expanding insurance
coverage is a cost-effective way to promote health.

They do not provide a link, but  a summary of the review that
(I think) they are talking about is href="">here
(small PDF).  And let us look at what they actually say:

review of
the research, conducted for The Economic Research Initiative on the
Uninsured (ERIU) at the University of Michigan by University of Chicago
health economists href="">Helen
Levy, Ph.D., and href="">David
Meltzer, M.D., Ph.D., reveals that the vast majority of the
studies examining the extent to which health insurance can improve
health outcomes cannot determine a causal effect because they
don’t adequately control for other key factors, such as age
or income, that may contribute to health status. [biographical links

What does this mean, in simple terms.  It means that the only
way to be sure of a correlation would be to do a controlled study: take
a large group of people, randomize them into two groups.  One
group gets health insurance, the other group does not.  Follow
them for many years.  See how the health outcomes compare.
 Now, ask yourself, if you had health insurance, would you
voluntarily give it up in order to participate in such a study?
 If you were on an institutional review board, would you think
such a study would be ethical to conduct?  

Let's dig a little deeper:

Access to medical care through insurance is one
face="Helvetica, Arial, sans-serif"> of many
factors determining health status. Other
face="Helvetica, Arial, sans-serif"> indicators
include age, stress, income, education level,
face="Helvetica, Arial, sans-serif"> health
behaviors, beliefs about Western medicine, and
face="Helvetica, Arial, sans-serif"> genetic
predisposition to disease.

Correlation does not mean causation. Of nearly
face="Helvetica, Arial, sans-serif"> 1,000
studies showing that people without health
face="Helvetica, Arial, sans-serif"> insurance
have worse health status than those with
face="Helvetica, Arial, sans-serif"> insurance,
less than a dozen are designed in a way to
face="Helvetica, Arial, sans-serif"> determine if
the relationship is causal.

Insurance expansion benefits children, elderly.
face="Helvetica, Arial, sans-serif"> The few
studies designed to determine such a causal
face="Helvetica, Arial, sans-serif"> relationship
show that health improvements have
face="Helvetica, Arial, sans-serif"> occurred for
children and seniors under policies that
face="Helvetica, Arial, sans-serif"> have
expanded Medicaid, children’s health, and
face="Helvetica, Arial, sans-serif"> Medicare
coverage. But evidence is lacking that health
face="Helvetica, Arial, sans-serif"> insurance
improves the health of non-elderly adults.

They say that nearly 1,000 studies
do show
a relationship between insurance and better
health.  True, most of them cannot establish causation.
 But don't you think if you do 1,000 studies and they all show
the same thing, it probably is not random finding?

They conclude that there is definitive evidence that health insurance
benefits the elderly and the young.  What they don't say is
this: Of the people in the middle (ages 20-40) the three leading href="">causes of
death are accidents, homicide, and suicide.  True,
health insurance does not make a big difference in those situations.


So how were these studies done?  Did they look at the causes
of death where health insurance could make a difference?
 Plus, some estimates place medical mistakes as the third
leading cause of death.  In those cases, it may be true that
having insurance actually leads to worse outcomes.  (That's
another story.)

Going still deeper:

It’s widely perceived that health insurance coverage affects
health status or health outcomes. However, your work indicates that
this is not the whole story. Why?

Our work doesn’t argue that health insurance does not impact
health, only that much of the evidence that claims to show that is less
conclusive than one would like. The literature clearly shows that
health insurance coverage is correlated with health status, so that
people who are better insured tend to be in better health. The
questions are: “What drives that correlation? And is there a
causal relationship that people who have better insurance have better
health because they have insurance?” That’s a lot
harder to know.

I think it is fair to say that the authors of the Cato article style="font-style: italic;">grossly
misrepresented the literature they cited.  Going back to their

study published in the New England Journal of Medicine last year found
that, although far too many Americans were not receiving the
appropriate standard of care, "health insurance status was largely
unrelated to the quality of care."

This shows that, once a patient is in the doctor's office, the doctor
treats the patients with the same efficacy, whether or not the patient
has insurance.  I would hope that would be the case.
 It does not show that the lack of insurance has no effect on
outcome.  Furthermore, is does not show that the provision of
universal health coverage would not improve outcomes.  In
other words, it is irrelevant to the point they are trying to make.

common concern is that the young and healthy will go without insurance,
leaving a risk pool of older and sicker people. This results in higher
insurance premiums for those who are insured. But that's only true if
the law forbids insurers from charging their customers according to the
cost of covering them. If companies can charge more to cover people who
are likely to need more care — smokers, the elderly, etc.
— then it won't make any difference who does or doesn't buy

Yes, this is a concern.  But if you allow insurance companies
to charge the actual costs, you may as well dispense with the insurance

suggest that when people without health insurance receive treatment,
the cost of their care is passed along to the rest of us. This is
undeniably true. Yet, it is a manageable problem. According to Jack
Hadley and John Holahan of the left-leaning Urban Institute,
uncompensated care for the uninsured amounts to less than 3% of total
healthcare spending — a real cost, no doubt, but hardly a


No one said it was a crisis.  But, it does drive up costs for
people who wither pay out of pocket, or who have insurance.
 In fact, it has a much greater effect on those who pay out of
pocket, since  insurance companies cap the rates for insured
 If you are a proponent of a free-market approach, this
cost-shifting should be highly troubling to you.

agrees that far too many Americans lack health insurance. But covering
the uninsured comes about as a byproduct of getting other things right.
The real danger is that our national obsession with universal coverage
will lead us to neglect reforms — such as enacting a standard
health insurance deduction, expanding health savings accounts and
deregulating insurance markets — that could truly expand
coverage, improve quality and make care more affordable.

Again, part of the reason to have universal, single-payer coverage is
that it would be simple.  All of the schemes noted above would
make the system more complex.  Plus, none of those proposals
would lead to universal coverage.  Not good.  I don't
need to belabor this point; the New England Journal of Medicine just
published a critique: href="">Benefits
with Risks — Bush's Tax-Based Health Care Proposals.
 It is one of their open-access articles.  I don't
blame the authors for failing to note it; it was published after they
wrote their article.  But the criticisms are valid.

Mencken said: "For every problem, there is a solution that is simple,
elegant, and wrong." Universal healthcare is a textbook case.

This would be a great, pithy conclusion, if they had built a valid
case.  Since they presented no valid points, is loses some of
its luster.


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