Monday, July 06, 2009

Too Late to the Debate

There has been an ongoing and rousing discussion over at Right Michigan the past few days concerning health care. I was out for the weekend and did not have time to give them my two cents worth.

When I finally did have a chance to sit down today I discovered that my comment was probably too long for anyone to read particularly as the 61st comment. So I thought I would post it here. At least here I am wasting Google's resources.

Here goes...

I hate to burst the bubble of everyone here, but there is no solution to the rising cost of health care if we are to accept the parameters and definitions that are being hoisted on the health care infrastructure by advocates. No solution at all. And, I'm an optimist!

The only reason that anyone can afford car insurance or house insurance or life insurance these days is because these insurances operate differently than does health insurance. In all of these other insurances the risk is spread out among all policy holders while at the same time what we are insuring against is the anomalous. (Life insurance has a few variations but is principally the same.)

There would be no affordable automobile insurance if each and every car on the road was wiped out by accident every few years. No, what we see in junkyards are primarily cars that spent their 15-20 years on the road and then rusted out, or had an engine blow out, or lost a transmission, etc. In these cases the car is no is longer worth the investment of a major overhaul to its owner. Therefore the risk of vehicles that were tragically smashed can be spread among all cars driven because, thankfully, most cars are not destroyed by smashing.

But advocates want health insurance to be different, and because of this they are not peddling insurance as we have grown to understand the term at all. There is currently little spreading of the risk in health insurance because death is not anomalous and postponing death is very expensive.

Enter our savior, the government.

First, our government is already inextricably linked to health care. This began years back when an earlier generation of bureaucrats thought they could solve the problems of health care. Then later generations of bureaucrats thought that they could fix the blunders of the older bureaucrats. Alas, they ultimately created even more complicated blunders. Wash, rinse and repeat. Forward that until we now have a system so complicated with bureaucracy and regulation that now, short of a total government bankruptcy and ensuing anarchy, government will always have its big fat butt firmly planted in our doctors' offices, forever.

Our government is notorious for attempting to manipulate the price of things, especially when they are footing so much of the bill. Of course, price and cost are two different things, and by arbitrarily reducing the price of health care and not considering the associated costs we will automatically get a shortage of supply. This shortage will include personnel, equipment, hospital bed space, more advanced medications, etc. That does not mean that there will not be any advances here and there, but it does mean that the rate of advance will be significantly curtailed, and that these advancements will be themselves only available to qualified patients.

As shortages become more and more apparent, rationing will become more and more necessary because the need for care will grow with the complications created by rationing. (You know, when that nasty growing mole that could have been removed routinely was allowed to grow into full fledged malignant melanoma that will require a surgical team to remove.) Rationing will not only amount to long delays in appointments and procedures but will also entail a designation of patient qualification. Certain patients will no longer be considered for certain procedures. The 80 year old will no longer get bypass surgery. The 70 year old can forget about that new hip. The 60 year old can kiss his Viagra (and perhaps his wife) goodbye. The 50 year old will finally be able to get that mammogram, though the mastectomy cannot be scheduled any sooner than 8 months after the tests are finally read.

Health care providers, if they want to keep their license, will ultimately be denied the right to operate outside the bounds of the system. This is the only way to make certain that all the rules of the game are followed. The rich, of course, will still get their care, they will just do so by flying to India or another nation willing to capitalize on our shortcomings. Rich Canadians will also go to India because the hospitals in Detroit and Buffalo will no longer be able to accept Canada's elite. I would not expect all of these things to happen in the first year or even five years, but they would develop over time as the system itself begins to creak under the weight of its own constraints and as the next generation of advocates try to fix the problems caused by the most recent fix.

The problem is, of course, that today's system, though not "national health care" is still replete with so many glitches that costs have outpaced the ability of many to pay. We also have to recognize that research and the introduction of new medicines and equipment are hugely expensive and that these costs are largely borne by the medical customer of this country because it is here, in our current system, that most of these advances are made. That is why I (amongst millions of others) do not have health insurance today. So, I am not defending the status quo, though I do believe it is a better system than it will become when it is ultimately handed over to any President and his group of bureaucrats.

I recognize that we have a dilemma and few people are happy with the way that health care costs have risen of late. Yet, the only proposal gaining any traction these days has been to enact a national system that will do little but add layer upon layer of bureaucracy to the current disaster. No one has had the backbone to suggest that government be totally extricated from the problem it by and large created.

The fact is that health care has always been rationed. In the past the free market allowed for rationing on the basis of wealth. The rich got everything they wanted, the middle class got most of what they wanted on the installment plan, and the poor did without or received the charity of the rich. But wealth has never been a acceptable way to dole out care, particularly when, as a percentage of population, poor and middle class people outnumber the rich, and it is voters that will drive the debate.

So, what we will ultimately end up with will be a system where rationing is decided by the bureaucrats, but this only after they have successfully absconded with another few percentage points of GDP. The new system will not be as efficient, it will reduce medical advances, it will strongly contract the medical industry, will lead to a shorter life expectancy in this country, and it will slowly restrict the freedom of citizens that wish to engage in sinful activities that might drive up the cost of Uncle Sam's medical bills such as smoking, consuming sugary drinks, eating fried foods or pork, riding a bicycle without a helmet, or mountain climbing. These intrusions into our private lives would have been enough to send the founding fathers to war. Today we are better at hurling insults.

Given a choice, and I say this as a non wealthy man, I really would prefer a system where wealth and common sense (providing free medical care to indigent illegal aliens and death row and other heinous criminals is insane) dictated who received care. When you lift the stifling hand of government off of the free market we get a much better product that is more affordable to everyone.

6 comments:

Anonymous said...

As the one at the RightMichigan blog who caused "vigorous" debate, I should point out that with the exception of a couple of posts by Eric the "debate" was one-sided: my facts and points were answered with "loser" and "dillweed" comments by Gillman--and then I was banned.

Go figure.

I at least applaud your efforts to want to debate this issue. It seems the Right is far too insecure most days to want a debate (re: any disagreement with the party doctrine=trolling and banishment).

I understand your premise, but I feel you're making some leaps in logic and projecting a sky-will-fall scenario that hasn't been substantiated.

In fact, your side has had recent history in attempting to destroy a system where risk is spread out over a large pool to reduce cost and risk: PA 106. Before that law, MESSA was able to use large pools. Now? No more large pools and cost is dictated by direct experience.

Another hypocrisy (related to the above): "free market" advocates clamoured for government intervention and control of Michigan health care--and still are, as evidenced by the Mack Center's recent thesis that the government should force HSAs on all public employees.

And where are these long lines? In Canada? I have Canadian friends who laugh at that adage. Come on.

Not that we're advocating a Canadian-style system here anyway. But the cliches and fearmongering are coming off as really weak, rhetorically speaking.

As no one would answer this at RightMichigan, why is Walmart and the AMA getting behind the Obama plan?

Roug said...

My response is too long for one comment and I will have to break it into two equal blatherings.

First, if I banned the readers here that disagree with me all that would be left is Mom. And that would be out of love, not agreement.

Oh, I know I'm doing some projections here, but my projections are largely based on economics, observations of countries with socialized medicine, and human nature. Besides, it would be pretty hard to substantiate something that is yet to be, though that does not diminish its inevitability. We can plainly see these developments in countries where socialized health care is the norm.

As far as holding me responsible for my side having destroyed the tenets of risk spread, I would tell you that I refuse to be held responsible for most of the dunderheaded things forwarded by politicians on both sides of the aisle. I suspect you don't want me to hold you responsible for the killing fields either. I am not an anarchist by any stretch, but I am of the opinion that government, when it dallies in venues where it has no business, ends up screwing up a lot more than it ever fixes. I think health care is one of those things.

I am a free marketeer and I make no apologies for this. I believe the free market works best and always will work best. We have not seen the free market in health care in this country for many decades. This does not mean that the Mack Center is wrong for suggesting that public employees abide by the same dictates it subscribes to the rest of us. I think members of congress should also buy their own lunches, pay into social security, and stop using their positions of power to get themselves better financing on that third home in Vail. These things do not make me less of a free marketer, it simply makes me feel better that those jackasses aren't lining their pockets while I am the one paying the note.

It isn't just the long lines that make socialized health care problematic, though that certainly is one thing. When I typed this "(You know, when that nasty growing mole that could have been removed routinely was allowed to grow into full fledged malignant melanoma that will require a surgical team to remove.)" I was referring to an acquaintance of mine that moved from northern Michigan to Ontario three years ago. Had he remained in Michigan he would have had a mole removed. Alas, the rest (including the surgical scars) are, as they say, history--a history that included a long delay in getting the mole looked at, a long delay in getting the biopsy results back, and a delay in getting the surgery scheduled even when the clock was ticking. By the time the surgeons were ready to take the leap they had cautioned the family that if the cancer had spread too far there would be nothing they could do. Oh, and Merry Christmas!

Roug said...

I appreciate that the Obama solution is not a mirror of the Canadian system. But, where the two overlap there will be identical problems, where they vary the problems will vary but will still exist.

I can only speculate on WalMart's support for the system. My guess is that the company will be able to use its huge size to leverage a pricing advantage over its competitors. Then, when it has been able to adequately expand its market share it will then drop its employees' health insurance altogether and dump the employees into the government side of the pool. Government regulation never cripples the big boys, it merely hurts the small boys in their competition with the big boys. (It is the same response I give when people ask me how Dow Chemical can actually support Cap and Trade.) Of course Walmart supports this--ultimately it will help them competitively.

As far as the AMA goes, I have only done about 10 minutes of research into this. It appears to me as if the AMA is agnostic on the whole "national health care" thing though they do support reform. Many articles on the tubes about this. I'll link one...

http://healthcare.change.org/blog/view/the_ama_neither_supports_nor_opposes_the_public_plan

My objections to national health care are based on what I believe the results will be in the long run. If I thought these suggestions would work I would be on board. I'm too practical to base my knee-jerk negativism on political affiliation. In fact, I'm too much of a knee-jerk negativist to really fall within a political party these days. How does the old saying go? I didn't leave the party, the party left me.

I can certainly understand that this generation of bureaucrats think they have the answers to a problem that the older generation of bureaucrats helped to create. I firmly believe that the next generation of bureaucrats will be around to add some gauze to the top of Obama's bandage that covers the stitches that replaced the butterfly that was to help the ointment that picked up when the antiseptic spray failed.

Really, I enjoy the debate. I fear that this is one of those things that we will simply have to agree to disagree on rather than getting all ugly about it. Mom hates it when I get mean.

Got to go. I have more wood to cut.

james said...

Let's go back to the 'bankruptcy and anarchy' part. Sounds inevitable, I mean interesting.

Anonymous said...

I am truly sorry to hear about your friend's medical issue with the mole.

As I pointed out in the RightMichigan thread, I have a teacher friend with an inoperable brain tumor who has (supposedly) good insurance. Yet her family and friends have had multiple fundraisers to raise money for care not covered by her insurance.

I'm sure both us could sit here all day and cherry-pick examples that would support our world view. Would those cherry-picked examples be an accurate statement on the condition of the whole? Hmmm...don't know.

The private sector, weak arguments to the contrary, has had its chance with health care. If we were talking about IPODs, I'd say let the "free market" dictate whether people could get them or not. But we're not talking about can-do-without plastic toys: we're talking about life itself.

The free market also had free and unfettered reign around the turn of the 20th century (no unions, no FDA, no nothing, really). The abuses to the public were so legendary and ghastly that a Republican president (Teddy) finally said "enough" (in short summary of that era).

But "that was then and this now," right? A nice argument that glosses over human history and can be used to bludgeon whatever the Right wants to whack: unions (not necessary anymore), health care (the free market can take care of everything--just ignore all that history behind the curtain).

The government doesn't have to be "the" player, but "a" player in this thing. It's like Obama said: if the government can't do anything right, the private insurance companies howling about this really don't have a thing to worry about, right? People will still flock to their "superior" product.

People are still going to be free to seek out the private sector and participate in the "free market." Actually, there will now be MORE choices if the government offers a plan.

You all should love that ;)

Roug said...

One point of clarification and then a couple final points.

First, the gentleman I referred to is now well along in recovery. He is not a friend per se, but an guy I met a few times and exchanged hellos with before he moved. He is the brother in law of a friend.

Your choice of IPODs for your example might not be the best one because it was not long ago that several of our beloved overlords decided that providing all public school kids with a free iPod was a great idea, this while Michigan was trying to balance a huge budget deficit. Thankfully, Matt Gillard was term limited.

Ultimately I do believe the government will become "the" player rather than a simple alternative. Obama's current plan might not be the final step in the process but it is an important intermediate one that virtually guarantees a government run system when companies begin to dump private policies for that of the savior's. After a couple of decades the only people left with private insurance will be the rich, and we both know which political party will not let that situation stand.

I think we have pretty much beaten this horse to death. Tomorrow I'm going to look for a document that will help illustrate how much costs have risen in the past few decades. Before government intrusion and even before, gasp, anyone had health insurance.

I hope to find it.