Seen in the Comments–Vizzini Edition
In this post of mine on Efficiency and Administrative costs frequent commenter Michael Reynolds wrote,
How about we take the French system plus 20%? Hell, France plus 50% would represent a staggering windfall for us. In fact, we could buy France with the savings.
I don’t think that word (windfall) means what you think it means. That the French and their health care system are heading towards the same cliff we are, just not as fast, is not what I’d call a windfall. It is arguably a reasonable first step in health care reform, but it is not the end solution. And since we’d still have a health care problem even if we implemented the French system plus 0%, no we couldn’t buy France. The problem isn’t so much that we are spending too much right now, but that the rate of growth of health care costs is unsustainable. Switching to the French system might help that problem, it might put off the day at which things get really bad, but it isn’t a permanent fix.
If I have a hundred dollars and I spend 10 dollars a year and that goes up by 5% a year, I go broke pretty quickly.
If I have a hundred dollars and spend 5 dollars a year and that goes up by 5% a year I also go broke — but not as soon as I do under the first scenario.
As for the windfall aspect, it’s pretty much the case that if you cut my yearly cost of anything in half that’s a windfall. More money in my hand, less in someone else’s hand. Windfall.
It’s a start…
For all the discussion about rising health care costs and how to pay them, I’d like to hear more about exactly why healthcare costs are rising so much.
One of my main objections to government-subsidized health care is that government money never really makes anything cheaper (unless it comes with major stipulations) and the market can do cost-cutting much more efficiently. But that doesn’t seem to be the case in health care right now. Right now, cost-cutting seems to mean denying treatment rather than providing cheaper treatment. If Wal-Mart operated on the denial-of-service principle (for lack of a better term)…they wouldn’t be Wal-Mart.
I think the government’s role would be best served in guiding cost-savings rather than covering the costs themselves. That way you get the best of both worlds, free-market efficiency and a hand that isn’t quite so “invisible.”
Any ideas on how, or if, that would work?
Herb, stop asking the right questions. So far the discussion is still centered on how to pay for the rising costs while essentially ignoring any attempts to control those costs.
We have two choices. One, control demand through rationing. That seems to be the way a single payer system would work. Or two, increase supply of service. How cheap would it be if we increased the number of doctors and subsidized their education? Nurses? Techs? What about subsidizing effective health technology? CT and MRI machines?
I want to know more about the free market approach and increasing supply but I doubt the AMA or the government does. I would guess it would cost me less.
We have health care rationing. It’s rationed by the insurance companies. Free market rationing.
Now, I agree with Schuler that we need to increase the supply. More doctors, lower pay. That’s one of the keys to the French system. (And of course their doctors don’t make more money for performing pointless procedures. Which may be why Frenchmen outlive us.)
But let’s not kid ourselves that we live in some free-wheeling lala land where we have no rationing. We have rationing right now. It’s just rationing based on profit motive not the health needs of patients.
Why anyone thinks that’s the best of all possible systems is a mystery.
I don’t believe anyone thinks this is the best system but there has to be more debate about the best way to go about fixing the system. Your analogy of something costing 50% less sounds great but what it really means is, you’ll pay the same or more and there will be no “savings” to you. The savings goes to the people who currently have no insurance. Which of course is awesome for the people currently uninsured, but sucks ass for everyone else imo
Knowing our political system I would much rather have insurance companies rationing than the government.
The unknowns of single payer should make us all afraid. Like doctors say,if you need an aspirin don’t take the whole bottle. Incremental change makes sense if any change at all.
Steve,
Supply isn’t an issue. There are more MRI machines in the city of Houston than in the entire country of Japan. Now admittedly Houston has perhaps the best medical centers in the world but wouldn’t you say that’s a bit of overkill?
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That’s a statement of faith.
If France’s government can run an efficient system, why can’t ours? Perhaps because the French do not hold hold the quasi-religious belief that government = stupid, the free market = smart?
Is it possible that we get the government we think inevitable?
I am a physician. My trade is reality based. I need facts … not spin. Currently, in this country, health care is patient-centered and patient-directed. That is not the case anywhere else. As soon as you start discussing the “cost” of health care, you know the patient has been forgotten.
What does it mean to “run an efficient system”? What is the value of the next 24 hours of your life? … of your demented mother’s life? … of your neighbor’s demented mother’s life? These are real moral and ethical dilemmas that people face every day. These moral issues are primal. The economic issues are secondary.
Let me know when you decide what kind of country this is … and what kind of animal we have become.
Uh, for many folks who post here, that last is false. For them, the economic issues (read, taxes) are the moral issues.
Since most of society’s ills are addressed through economic means it’s hard to disconnect the two. Money spent on one problem cannot be spent on another. Economic growth provides more money for social programs. More affluent citizens need less help. For that matter moral issues know no borders so should we be funding health care around the world like out own? You can’t just say this issue must only be thought of in moral terms. Public policy cannot be made in such a way.
sam, weren’t you just chastising me on my blog for overgeneralizing with the belittling brush?
Taxes aren’t necessarily the moral issue but they are a moral issue. The false dichotomy you and some others here offer that a person can care for either people or profits but not both is utter bullshit and damn insulting, but YMMV. Now you’ll probably say that this is an unfair reading of what you said, but from my perspective that is exactly how it reads.
Apparently trusting the government to do it right is a statement of reality, at least for those in the reality-based community.
That’s you arguing your faith against a straw man. I don’t have faith either way. I’m just not prepared to genuflect to the received wisdom that government is necessarily incapable of efficiency. If other governments can be efficient — as the French government appears to be — then why can’t ours?
But in the end you wont get that money, it is to be spent providing health insurance for others who currently don’t have health insurance.
Good luck with that. Doctors, the AMA, and others have a vested interest in keeping the supply limited. To keep from getting that lower paying thing. And don’t forget nurses. We can’t train all the nurses we need in this country. Good luck changing that, too.
Here’s an idea, maybe France’s government is less prone to rent seeking, regulatory capture and overall has better institutions. Or not. I really don’t know. What I do know is that these things can prevent us from rationalizing our health care system.
And why shouldn’t taxes be a moral issue? You want to take my money. I use my time and labor to earn that money. You are in effect using force to take my time and labor from me. To say it isn’t a moral issue indicates that whomever holds such a view is morally blinkered.
Actually, government provided outcomes are quite often referred to as “second best” outcomes. First best are the most efficient (as defined by pareto optimality) and are often unattainable. Even in a completely theoretical setting were you have a benevolent social dictator doing what he thinks is best for individuals you get less than optimal outcomes. Of course, at the same time, the market often cannot provide the optimal outcome either. But the idea that government is going to be “efficient” is largely a myth. The most that can be said is that in some cases government will be the best worst choice. I’d also point to the research of Elinor Ostrom that government need not always be the choice either when dealing with public goods, commons, and so forth.
And for f*ck sake Michael get it through your head. France’s system is not sustainable either. They aren’t efficient, they are just not as inefficient as the U.S. health care system.
Try this for God’s sake.
For example if we took “France’s systme + 50%” on a percentage of GDP basis we’d actually be worse off. For 2007 our health care expenditures as a percentage of GDP would go from a bit over 15% to 17.5% or so. That is a big increase. If we went with the French system + 0% we’d drop down to about 11% of GDP. A definite improvement, but again costs are growing too fast in France too.
Really, read up on this topic, your comments indicate a woeful lack of knowledge on the topic.
So, because our government is inferior we should shrug and move on rather than perhaps trying to improve our government?
Irrelevant. I’m often referred to as a genius. (Usually by me.) You offer no proof, just restatements of assumptions.
Actually, for f*cks sake get it through your head: no system is indefinitely sustainable. You insist on making the perfect the enemy of the good.
Everything we ever build — ever — is unsustainable. So the question is never “What is the perfect system?” The question is always, “What’s the best we can do for now?”
If we have a system that will melt down in say 10 years, and we are offered either the choice to let that happen or replace it with a system that will melt down in 30 years, I think we take option B.
You’re exasperated because I’ve asked you a very simple question that you ought to be able to answer but can’t. Do you have some proof for the proposition that government is necessarily less efficient than private industry?
I don’t think you do. So the eye rolling doesn’t really do much except demonstrate the weakness of what is a quasi-religious belief.
One other point: there’s no absolute standard of efficiency. It’s relative. Less inefficient equals more efficient.
This is why they should be teaching philosophy in schools.
Of course not, what I’m saying is that it is a factor that needs to be considered. If you don’t and try to forge ahead anyways you might be doomed to failure.
Google. Try it. Or look at Jean-Jaques Laffont’s text Fundamentals of Public Economics.
No Michael I’m asking you to stop using misleading and false statements. Your statement that France is efficient is not factually true. They are more efficient, but still have problems mainly with cost growth rates. The same problem we have.
Trite trivial truth noted, but irrelevant. The problem is that no country that I know has a sustainable health care system over the next couple of decades. Britain, France, Canada, Germany, and so on.
No duh. If this is all you have to contribute then please stop, it was part of the opening post.
I’m exasperated by your ignorance and false statements. France is not efficient. And yes, I have proofs, formal mathematical proofs, but call me Shirley, I don’t think you really want to see them. There are also empirical research papers on it as well, but I don’t think you want them either.
Backpedalling duly noted. And your statements were not relative, but absolute: France’s system is efficient. That is an absolute statement.
Bwahahahaha
Steve:
Let me guess, business school?
There’s no such thing as absolute efficiency. Just as there’s no such thing as absolute red. Or absolute nice. Absolutes are for mathematics. So I used the word “efficient” as any sensible person would to mean relatively efficient. But the qualifier really shouldn’t be necessary. Excuse me, it shouldn’t be relatively necessary.
I see we agree that we want a more efficient system. I see we agree that France’s system is more efficient than ours. I see we agree that the problem of an ineffective government is not chiseled in stone but might be changed.
Then I see you automatically precluding the possibility that government might deliver that efficiency. An assumption.
As for mathematical proof that government is necessarily less efficient than government, please, feel free to put up some links. This ought to be good.
In fact, Steve, it’s that kind of sloppy thinking that makes me think we should teach more philosophy. The notion that you can define efficiency and demonstrate the inevitable inefficiency of government without reliance on unproven presuppositions is at the very least extremely dubious.
But I await a dazzling download of the sort of thing that passes for serious thinking in B-schools.
Yes, they are real moral and ethical dilemmas and I have faced them, walked thru them, and I live with them every day of my life.
I had to look my mother in the eye and say, “Do want to go home?” and she said, “Not until I am ready.” to which I replied, “What if that day never comes?” She had the option and was dead 24 hrs later.
My father was not so lucky. I had to sit with him thru months of his praying for “Jesus to take me” because he knew he was losing it to Alzheimers and he could do nothing about it. Fortunately (for me) he now no longer knows he is losing it and is just my father (what is left of him)(he has not known my name in years) and I am able to enjoy him once again…
But I still pray for his release from the binds that hold him to this world, binds that I am powerless to break.
The conundrum: I can make the system pay tens of thousands of dollars per month (he has lots of insurance) to keep him alive, but I can not pay out of my own pocket for that which we would do for a dog.
Where is the sense? Where is the justice? Where is the empathy?
Where in God’s name, is the human dignity?
just a note to say i’m not abandoning thread just had minor surgery and loaded on vicodin and macallan. somewhat dopey.