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July 02, 2007

Perfect vs. the Good

Look people, just because a nationalized health care system in America is unlikely to be as cheap as similar systems in Canada, France, the UK, Japan, Germany, Australia, and so forth, doesn't mean it won't be significantly cheaper than what we have now. This isn't even an objection. It's a diversion. As we've already seen, the incentives and practices within government care systems really can sharply cut spending growth. Between 1999 and 2003, enrollment in the VA grew by 70 percent. Funding increased by 40 percent -- as quality improved. Even now, with a population that's sicker, older, more likely to smoke, have diabetes, and abuse drugs, the VA spends more than $500 less per capita than the rest of the system. That's not to say they spend half as much, as Canada does, but they're doing a helluva lot better at cutting costs than the private system in this country. If national health care got everybody covered, improved quality of care, cut costs by only 2 percent, and merely slowed spending growth, well, you're telling me that's not worth doing?

The secondary point is that savings from an integrated system aren't all up-front. An overhaul that's spending neutral but brings the health system into some sort of coherent structure paves the way for all sorts of cost savings down the line. Within a single structure, you could impose anything from global budgets to first-dollar cost sharing to massive preventive health measures to huge improvements in chronic care treatment. Within the current system, where care is split between Aetna, and Medicaid, and Medicare, and UnitedHealth Group, and your employer, and the VA, and Blue Cross, and the state high risk pool, and FEHBP, and a thousand more besides, there's no way to impose cost-cutting measures. Were the system under one roof, there would be.

July 2, 2007 in Health Care | Permalink

Comments

If national health care got everybody covered, improved quality of care, cut costs by only 2 percent, and merely slowed spending growth, well, you're telling me that's not worth doing?

I'm guessing their answer would be 'no, it's not.' Getting everyone covered isn't something that's desirable for rightwingers, as far as I can tell-- after all, if you don't make being at the bottom of the ladder as miserable as possible, no one would ever try to climb, right? They don't believe in 'improved quality of care' in any meaningful way, either; it damages the cherished fantasy that most of us could jet off to the Mayo Clinic for hernia operations instead of being stuck in our own little insurer-enforced bureaucratic hells. Cutting costs would make their constituencies slightly less wealthy, so that's not good, and slowing spending growth would damage those same constituencies' future gains. Really, though, you can't actually communicate with people who aren't on board with the notion of there being an identifiable, improvable public good.

Posted by: latts | Jul 2, 2007 11:16:08 AM

Isn't it interesting? that this relic
from WWII (or was it WWI?),
the VA;
so wonderfully flies in the face of
the nasty corporatist types
who got us into either of those
military-industrially fomented conflicts....
In the first place.

Unexpected consequence from systems-in-play
is so cute...sometimes.

Posted by: has_te | Jul 2, 2007 11:39:22 AM

Between 1999 and 2003, enrollment in the VA grew by 70 percent. Funding increased by 40 percent -- as quality improved.

As quality improved... based on what data? All of the standard ones you cite-- JAMA, RAND, Annals of Internal Medicine-- use data prior to 1999.

Beyond the fact, all of these studies were either funded or authored by the VA itself. Given your comments on how silly Sullivan was to used biased data from PhRMA, funny to see the same thing here (I ain't defending Sullivan, but you're just as wrong as he is).

How about some data/analysis from a non-VA sourced, non-single payer advocate?

As I've said before, actual experience among non-VA health professionals would not agree with your assessment of the VA.

Posted by: wisewon | Jul 2, 2007 11:47:34 AM

Ezra,

If national health care got everybody covered, improved quality of care, cut costs by only 2 percent, and merely slowed spending growth, well, you're telling me that's not worth doing?

Probably not-- because there is a better option.

Because a heavily regulated, private market system can get everybody covered, improve quality of care, probably won't cut costs much from the existing base, but will slow spending growth better in the long-run.

As I've said before-- the spending growth issue is the real tough one here-- and one that I haven't heard great ideas from single-payer advocates. Ezra has a good one-- a "commission" of sorts to evaluate cost-effectiveness, but what's not understood is that this is not so black-and-white. We are going to need multiple groups of people with different ideas on cost containment competing among ideas. One group residing within the government will be outperformed by multiple groups on the outside. This competition of ideas is lost in single-payer. If we "knew" the answer to cost-containment, it would be a much different story. But given that we don't (and neither does any other country), we should be promoting experimentation and competition.

Posted by: wisewon | Jul 2, 2007 12:00:35 PM

Within the current system, where care is split between Aetna, and Medicaid, and Medicare, and UnitedHealth Group, and your employer, and the VA, and Blue Cross, and the state high risk pool, and FEHBP, and a thousand more besides, there's no way to impose cost-cutting measures. Were the system under one roof, there would be.

This just isn't right-- government could just as easily regulate/legislate the same priorities in a private market system.

To underscore the point-- a better regulated, private market system can accomplish the main objectives of a single-payer system, while still allowing competition on cost-containment and other elements of health care that there are currently no easy answers.

Posted by: wisewon | Jul 2, 2007 12:05:58 PM

Nobody ever talks about potential productivity gains that can come from having a fully insured populace, either. More than anything else, that's what surprises me about people's opposition to Universal care. But then, maybe those in power don't want the middle class to be able to start their own businesses without fear of losing health coverage. Maybe they want to maintain a system where those without resources up front have to put their ingenuity towards their large company's bottom line, because they need health insurance from that large company. Regardless, there's little question that national productivity would go up if everybody had good health insurance.

Posted by: spike | Jul 2, 2007 12:16:38 PM

"and merely slowed spending growth,"

Not what I would call a ringing endorsement for nationalized healthcare’s cost control capabilities. How about this? It’s not worth doing because it’s not a sustainable long term policy. If it can only “merely slow” spending growth, then its growth will continue to outpace GDP (which seems to be happening to all nationalized health care systems) and it will become too much of a burden for the gov’t to handle. I think any serious healthcare reform needs to address spending growth as much as it does coverage.

Posted by: DM | Jul 2, 2007 12:20:16 PM

Ezra, your main mistake is bothering to engage with Jane Galt. Her quoting of figures is selective and largely dishonest in this case, as I'm sure you realise if you read her post in detail.

Posted by: Meh | Jul 2, 2007 12:46:20 PM

The prices of health care in Canada and the UK are really badly explained. For example, the OECD claims that the per capita cost of British health care is 7.3% of GDP, or about $131 billion US. But the British government states that is budget for health care is $118 billion US - a discrepancy as large as the GDP of Ethiopia! British watchdog groups peg the UK expenditures as clsoer to $200 billion per year.

Since social-plan health care is paid for by taxes (primarily) and out of pocket expenses 9much less) it is useful to look at the costs *per taxpayer* in those countries, because the health care in paid for by them. Per taxpayer costs come to about, oh, $8,000 per taxpayer per year in the UK and about $8,200 per taxpayer per year in Canada (US dollars).

Not quite the "half as much as the US" numbers anymore when you look at it that way. The US system is hideously complex when looked at per payer [what about vets who pay taxes still? or pension recipients with medical coverage that is privately funded?], but it is doubtful the American per payer costs exceed 140% of the actual per payers costs of the UK and Canada.

Also, remember the artificial cost controls in both nations where medical salaries in the system are set by bureaucrats, certain drugs are excluded, and the system relies upon profit-fueled US research to develop the majority of medical and pharma innovation. Canada only has 151 MRI machines *total* to keep down costs!

Posted by: Deep Thought | Jul 2, 2007 1:04:59 PM

sorry - the British official budget is $188 billion US

Posted by: Deep Thought | Jul 2, 2007 1:06:08 PM

"If national health care ... improved quality of care"

Huh? If you mean on average, assuming that the currently uninsured would receive better coverage, perhaps. However, the U.S. ranks first in the world in patient satisfaction with their health care, for good reasons. I'm a middle-aged, middle-class guy, and I receive fabulous health care. My doctors are excellent, I get same-day, morning appointments when I'm sick, I see specialists within a couple of weeks, the hospitals are fabulous, etc., etc., etc. I believe national health care would reduce the quality of the medical care I receive.

Posted by: ostap | Jul 2, 2007 1:17:43 PM

Deep Thought: Your MRI figures for Canada are out of date, but it's true that Canada has significantly fewer MRI machines per million people than the U.S. On the other hand, Japan has far more MRI machines (and far more CT scanners) per million people than the U.S.

Posted by: mijnheer | Jul 2, 2007 2:35:38 PM

ostap: As a member of the middle class, your ability to afford mundane medical expenses is fine-- but national health care would give you a far lower chance of being financially ruined if you suffered a serious illness or injury. This is now the leading cause of bankruptcy, even among the insured.

Ezra:
Please, help me understand why, if the VA is so good, do I keep hearing it's not from people with more first-hand medical experience than I?

Posted by: Anthony Damiani | Jul 2, 2007 3:00:23 PM

you have obviously never personaly been to a VA hospital, I have and it's not pretty. I wouldn't leave my dog there to be cared for. The two I have been in over the years were both filthy smelly disgusting places, floors and walls caked in filth. My father-in-law started dialisys in the Phoenix VA and in one month had been given an incurable blood infection that attacked his heart valves and killed him in under a year.

Your elitist socialist underware is showing.

Posted by: rivenburg | Jul 2, 2007 3:31:53 PM

mijnheer,
The Japanese health system has many high-tech gadgets. It also has long waits, poor followup, etc. That is why companies in Japan offer private health insurance - being able to avoid the national system is a large perk, there.

Posted by: Deep Thought | Jul 3, 2007 7:13:35 AM

I take him on here re wait times:
http://www.concurringopinions.com/archives/2007/07/any_hope_for_a.html

Posted by: Frank | Jul 7, 2007 9:47:43 PM

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