Take Care

One of my oldest, closest friends wrote to me privately in response to my anti-Socialized-medicine comments in Contingency Planning. He critiqued some of my thinking with the following comment, which I promised to think over and then respond to:

“I think you are comfortable with risk pooling, since you presumably have used health and life insurance your whole life. So do you really feel that society cannot expand the risk pool to include everyone? We were already significantly there before Obamacare even.

“I think it’s politically inevitable that we have universal healthcare and we need people like you to figure out how to make it work from the right, in order to avoid the hacks on the left ruining it. That’s why I say the German or some other European model should be analysed to learn from its successes.”

My friend is right, of course, that I think pooled risk-sharing is often beneficial, and that (I hope it goes without saying) I, like just about everybody else, support at least a baseline level of safety-net medical care for those Americans who cannot afford it. His idea is that putting these two premises together demonstrates that universal risk-pooling by the government will inevitably be part of any rational system.  This is a powerful argument for Medicare for All.

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Risk pooling is the central concept behind the insurance industry. It’s a mathematically sound means for people to cover the risk of unexpected, generally low-probability, otherwise-unbearable events like a car crash, a house fire or a life-threatening illness – at a bearable cost. In a private insurance market context, all the calculations around pricing (and buying or selling) insurance products are made by either consumers or businesses looking out for their own interests.

Much of the current “insurance” system though, at least in the context of payments for medical care, is not insurance-against-the-unexpected, but payments for, and for that reason, effective management of, the healthcare system. The insurance companies have become a gigantic layer of bureaucracy between patients and the healthcare providers; it’s not their fault that they’ve undertaken this role – it was the inevitable result of the bizarre Congressional decision decades ago that healthcare benefits for employees could be tax-deductible to the employer, while healthcare expenses paid by individuals are not tax-deductible. Hence, companies were directly incentivized to provide such benefits through the insurance system, and our medical payments systems became one step less directly accountable to the patients/consumers.

Just as you insure your car against a crash, but not against routine maintenance, the same should be true of how you insure your body. You wouldn’t want to have to fill out paperwork to an insurance company for an oil change, would you?

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To me, the most important question with respect to healthcare – mine, yours, everybody’s – is who is making the decisions? I submit that the best answer is almost always going to be: you and me.

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Inevitably, in our mixed public/private system, the government makes lots of the biggest healthcare decisions for all of us today – and invariably it makes those decisions based primarily on political considerations. Often, these considerations result in what in a real estate situation might be called deferred maintenance – spending money on politically popular things today, at the expense of preparation for tomorrow’s possible needs.

Examples of this sort of behavior that have clearly made the current crisis much worse than it otherwise might have been include Jerry Brown having made a decision to get rid of California’s mobile hospital and “excess” ventilator capacity (https://www.latimes.com/california/story/2020-03-27/coronavirus-california-mobile-hospitals-ventilators?fbclid=IwAR1JOlBaxetGwcA8LSLp-Xw4orNi1xW5KHFE3aov5JgMpKWbbBj23bhUYwM) and Andrew Cuomo’s having boasted a couple of years ago about shutting down “excess” hospital capacity in New York City via squeezing Medicare pricing (https://www.wsj.com/articles/new-yorks-ailing-hospitals-11585179029?mod=opinion_lead_pos2). Yet a different kind of all-too-standard failure of government decision-making is the sort of general bureaucratic slowness that has made the current crisis worse highlighted here: https://nypost.com/2020/03/28/how-red-tape-has-crippled-americas-coronavirus-response/?utm_campaign=iosapp&utm_source=mail_app. Other examples are easy to find.

Such poor decision-making by the government should surprise no-one; it’s endemic to the situation where in a practical sense what these people are personally accountable for is not your health. I would no sooner give the government a monopoly over healthcare decisions than I would give it to the postal service. Neither can deliver the level of service or innovation that I want.

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Neither should we blindly trust the private sector with our healthcare decisions. This https://nypost.com/2020/03/28/how-doctors-put-healthy-people-on-a-slippery-slope-to-sickness/?utm_campaign=iosapp&utm_source=mail_app oped by a doctor named Steven Kussin in today’s New York Post makes a compelling case that we, as a society, are over-medicated and over-operated-upon. Its author describes a system in which doctors are always motivated to prescribe medications and procedures; after all, that’s what they get paid to do, and it generally seems the lower risk thing to do from the standpoint of potential legal liability. Otherwise, somebody might later accuse them of having under-prescribed or under-operated. Pharmaceutical companies – which do produce miracles, for which we all should be grateful (we’re rather expecting another shortly…) – are also in the business of encouraging people to buy their products, and they do so relentlessly, whether the prospective buyer’s need is marginal or overwhelming.

I find Kussin’s arguments highly persuasive. It’s nothing against doctors to accuse them of being self-interested in their behavior: we all are, and I’m pretty sure most doctors also genuinely care about their patients’ well-beings.  We just shouldn’t expect the incentives that the system puts before doctors to play no role in their decisions. We need to look out for ourselves.

***

I believe that whether we like it or not, for the vast majority of us, the decisions that we make about how we take care of ourselves make a far greater difference in our health outcomes than the interventions of the medical system, however organized. Eat carefully and drink moderately. Get some exercise and plenty of sleep. Give some love to those around you and to your community. And remember what my late mother used to tell my siblings and me: cleanliness is next to godliness.

Only see a doctor when you’re genuinely sick – or very rarely to be checked for invisible killers.

As to how our healthcare system and our social safety net should be organized and paid for: I believe that we will be better off to the extent that the system is directly accountable to you and me – and that is only achievable if it’s a mostly private system, where we pay the bills and are in a position to demand value for money.

And – in response to my friend’s comments – yes – the government (i.e., the taxpayers) should remain the default insurer of emergency medical care for the poor. We are not going to just let people die from unexpected accidents or curable life-threatening ailments because they can’t afford to pay for the emergency services; we haven’t for a long time, and we won’t start now. But covering such costs for the destitute is a very different concept from Universal (i.e., government-run) Healthcare.

M.H. Johnston

One comment to Take Care

  • Vivian Yess Wadlin  says:

    My main reason for objecting to government-run healthcare is the making of a slave caste–ie, the provider of health services. When the provider of a service can no longer negotiate their own compensation (fees), fewer smart people will become medical practitioners. Those who do will be ill-used by the system. And individuals are not at their best with a gun to their heads.

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