Some stupid ideas just won't die
July 1, 2017 | Will no one rid me of these meddlesome fallacies? There are two ideas that keep cropping up in American conversation that deserve to be interred: First, that government should be run like a business. Second, that people should shop around for medical care.
It should be self-evident that government is not a business, and therefore shouldn't be run like one. A business tries to maximize profits and dominate its market niche. A business can be ruthless in its pursuit of these aims. Government on the other hand, at least in the democratic formulation, exists "to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity." Or at least that was the vision our founders had when they wrote the Constitution. Nothing there about profits and market share.
Donald Trump sold himself to some of the American electorate as a businessman who knew how to get things done. Only he could do it. And we see how that's worked out. Who knew it would be so complicated? Who knew, indeed.
I was reminded of the second of these canards while reading an essay in the NYTimes by Bret Stephens, one of their resident conservative voices, titled A Price for the G.O.P.'s Health Care Insanity, a title that I admit had the right words to get a click out of me. Towit: GOP insanity. He began by recounting examples of how the costs of medical treatment can vary wildly.
It costs as little as $10 and as much as $10,169 to get the same blood test in California. A lower-back M.R.I. priced at $199 at one Florida clinic goes for $6,221 in San Francisco. A shoulder X-ray can run anywhere between $21 and more than $700 across the United States.
There's certainly nothing to argue about there; I see it all the time. My doctor will order a panel of blood tests, for which the hospital bills my insurance company $1822.90. Then the insurance company takes the various discounts according to their contractual arrangement with the hospital and pays the hospital $142.83, leaving me to pay a $15.00 "copay." I've written before about all the funny money that is floating around in the healthcare system. There's probably not a single person who would not agree that it is a gawdawful mess.
But then Stephens went off the deep end:
Many things about health care delivery in the United States are insane. The economist Kenneth Arrow crisply described the biggest insanity back in December 1963. “Insurance,” he wrote, “removes the incentive on the part of individuals, patients, and physicians to shop around for better prices for hospitalization and surgical care.” When did you last go bargain-hunting for a urinalysis?
There they go again! Purchasing healthcare is not like buying a refrigerator. You can go shopping for a refrigerator, examining features, making decisions you understand about whether to get an in-door water and ice delivery system, whether the freezer is on the side, below, or above the refrigerator, what size the refrigerator should be, and so forth, and once you've decided those things you can check where to get the best price for the refrigerator you've chosen. And it doesn't matter whether you buy your Samsung refrigerator model RF28HMEDBSR/AA from Best Buy, Sears, Lowe's or Joe's Appliances — they're fungible.
Healthcare isn't like that. Doctors are not interchangeable. For more than a scraped knee seen at urgent care, it matters a lot whether you feel a rapport with your doctor, whether you trust his knowledge and judgement, and so on.
Much of the time you simply don't have a choice. If you have a car accident, you are going to the nearest hospital, and even if you're conscious, checking Yelp reviews on your cell phone while en route will not do you any good. You just have to hope they're competent and can fix you up.
Often the need for healthcare isn't something you can anticipate. If you have a heart attack or develop appendicitis during the night, your only real choice is to call 911 and hope for the best. Again, you're not going to spend the time in that ambulance calling around and getting three quotes.
Even when healthcare involves something manufactured — prescription drugs for example — it's not so easy. Say your doctor wants to prescribe some new blood thinning agent. You can't just take your prescription around to several drugstores in your town (unless you're in a city, there's probably only one in the first place), because guess what? Most pharmacies insist that prescriptions be transmitted electronically. And if the doctor sends it to one pharmacy, you can't find out the price at any other pharmacy without having your doctor send it there as well. And no doctor will do that. You're stuck. And if your insurance covers prescription drugs, you're even more stuck, for that's where the whole matter of the "formulary" and "in-network" pharmacies come into play. In short, it's out of your control.
The thread that runs through these cases isn't that people don't have incentive to shop around, it's that you really can't, whether because of circumstances or because of legal and insurance restrictiions. And what relevance does a 1963 white paper have anyway, for 1963 predates our current reality of Medicare, Medicaid, Obamacare, CHIPS, etc.
If our political "leaders" were really interested in making our healthcare system better, there are easier paths to follow than "repeal and replace." Isaac Newton remarked, "If I have seen further, it is by standing on the shoulders of giants," recognizing that progress is made when you build on what predecessors have done. The current crop of Rs seem to believe that you do it by stepping on the toes of those who came before and tearing down everything they have done.
Whenever talk turns to healthcare, people get into their ideological corners and come out swinging wildly. But stop and think for a moment.
In short, we already have government health insurance programs (the first five listed above) that apply to a large percentage of the population. If we were interested in making sure everybody was covered, the simple thing would be to expand some of these programs that have been shown to work. (I had wanted to make a pie chart showing how much of the population each of these covers, but I couldn't find the right data.)
Bernie Sanders pushes the idea of "Medicare for all" but it might be better to think of Medicaid for all. Medicaid isn't just for poor people. It could easily become the default government health insurance plan. Make enrollment in Medicaid automatic, everywhere. Medicaid has some shortcomings, to be sure, but they can be fixed. It's not ideal, but it's better than having no coverage at all. Especially in states that expanded Medicaid under Obamacare Medicaid has already become the default insurance for many. That's why some of even Republican senators are loathe to sign on to Trumpcare, because they know how devastating it would be to the people in their states.
Everyone has their knickers in a twist about insurance companies leaving the Obamacare exchanges, but that's no surprise. The Trumpists have done everything in their power to sow fear, uncertainty, and doubt (FUD); some would call it outright sabotage. Although Obamacare was sold partly on "choice," that was never very realistic in the rural, sparsely populated states that make up much of the country.
But as I said, it all depends on whether you want to fix things or not. The Rs have wanted to shred the safety net and unleash the barons of industry ever since the days of the New Deal. But there's a funny thing about people: once they have an entitlement, it's very, very hard to take it away.
Last updated on Apr 13, 2018