Friday, August 28, 2009

American Health Care Killed His Father?

The Atlantic has a good-- albeit long-- article this month by David Goldhill concerning health care, called How American Health Care Killed My Father. I'll make a few comments and leave a few unsaid. The dramatic title actually belies a more thoughtful attitude within the essay.


The economics of health care are the most complicated of any product in human society because of all the competing interests and weird incentives. Surgeons make more money when they do surgery, yet an ethical surgeon can spend most of his or her day talking people out of having surgery. And on and on. The entire fee-for service system has a huge inherent flaw, which Goldhill has noted.

The author states his father died from a nosocomial infection that could have been prevented by simple handwashing. Perhaps, but hosptials are inherently dirty places and even strict hygeine practices can leave patients vulnerable, especially elderly and infirm patients such as his father. Hospitals are constantly reviewing "best practices" for patient safety and cost-savings and I would compare this to aircraft maintenance and air traffic control in may respects. Does the free market improve air travel safety? Maybe, but everyone would agree that the federal government, working in league with the indutry, has a role to play, and I am the first to agree that more can be done.

"Government-run" health care is different from "government-financed" health care and this author has drawn that distinction, which is commendable. He also notes that we have had deflation of costs in almost all technologies with microwave ovens, computers and televisions all costing less today than they did 15 years ago, and then he tries to draw an analogy to the 20 yr/old MRI technology his wife had, implying that health care has not kept pace. This isn't quite accurate. The advances in medical technology proceed at least as quickly as kitchen appliances, and while I cannot speak about MRI's, I can say that ultrasounds and CT's have higher resolution and are much better quality than just five years ago, yet the reimbursement is the same or even lower. Also, the interpretation of the imaging by a clinician is the lion's share of the cost and that theoretically improves from decade to decade as we improve our knowledge base... again, at no increase in reimbursement in my 15 years in practice. The things we have to look at and rule out in an obstetric ultrasound have increased and the pay has not.

I fully understand the moral hazard issue and the whole disconnect with having a third party pay the bills and thus removing the responsibility of cost control and quality control from the consumer. Instead of comparing the health care product to Toyotas or lawnmowers, I would compare it, again, to air travel safety. It has to be of excellent quality ALL the time, and consumers really have no way of judging the quality of their care at the time they are consuming it. That c-section I did last week may have been done wrong, damaging the fallopian tubes and rendering the patient infertile. She won't know for a few more years, so what the hell. Likewise the treatment of asymptomatic hypertension, can be mistreated for decades before the 59 year-old drops dead prematurely from a stroke. This poses a dilemma that is handled in myriad imperfect ways to ensure quality: board certification, state licensing, hospital privileging, professional referral, etc. Quality-control is not something that can be done by the average patient and I think that we would be deluding ourselves and perhaps promoting a false sense of security to think otherwise. Sure, we could see a cottage industry crop up within the free market that evaluates health care delivery and I suppose such an argument could be made thusly to put more trust in the free market to find a solution, but it certainly would be no better than the tools we have now.

The author summarizes this sentiment:

Many experts oppose the whole concept of a greater role for consumers in our health-care system. They worry that patients lack the necessary knowledge to be good consumers, that unscrupulous providers will take advantage of them, that they will overspend on low-benefit treatments and under-spend on high-benefit preventive care, and that such waste will leave some patients unable to afford highly beneficial care.

They are right, of course. Whatever replaces our current system will be flawed; that’s the nature of health care and, indeed, of all human institutions. Our current system features all of these problems already—as does the one the Obama reforms would create. Because health care is so complex and because each individual has a unique health profile, no system can be perfect.

I envision my nightly television littered with ads for Crazy Lenny's colonoscopy shop with promises of "low low prices." Physicians always tread carefully around the line of crass commercialization and self-promotion versus collegiality and professionalism. In our community, for example, there are a fixed number of babies born and the competition for paying patients is tight between obstetricians, midwives and family doctors. By adding even more profit motive into the system, the risk is that we would swerve head-long into a bidding war that would get ugly. Would it lower prices? Maybe, but it could disrupt a delicate balance between quality and cost and could even decrease access if good providers chose to stop doing a service because the reimbursement was too low. Or worse, physicians might refuse to back up midwives in emergencies sensing competition from these more cost-effective providers.

Sure, the author notes that LASIK surgery has seen prices come down as competition has increased, but LASIK is a completely elective procedure unlike what is covered in Medicare and most insurance plans. The only thing that makes LASIK resemble "health care" is that it is done by people who attended medical school at one time. Period. The same goes for aesthetics, infertility care and some orthopedic sports procedures.* It is completely irrelevant to the discussion of providing urgent or semi-urgent care to sick, scared people, or to the long term management of chronic conditions.

Goldhill's discussion of health savings accounts (HSA) is appropriate for most of us, and this will likely continue to have a place in the panoply of options available in the system, and it may even have a material effect on lowering prices and streamlining the the process of payment by bundling, etc. I cannot see, however, how a mentally disabled individual could navigate the vicissitudes of HSA's, vouchers, deductibles, peer-provider groups, etc. The French have, arguably, the best health care system in the world and it's really similar to what's proposed by House 3200: namely, a mish-mash of various public and private options that are highly regulated by the federal government.

Remember that 70% of your health care dollars will be spent in the last 6 months of your life-- much like the author's father. So while we can scrimp $5 here on antibiotics or save $250 by being frugal and choosing to forgo a mammogram this year (not necessarily good economic decisions), an entire lifetime of perfect consumerism is completely erased by four hours in the ICU--- and are you going to shop around for a cheaper ICU? The information is asymmetric which makes for very bad decisions by consumers. Besides, what would prevent free market hospitals and doctors from just jacking up the prices when they have you captive?

One more quick point about the estimated "cost" of the plan on the table, by which I assume he means the House Resolution 3200 (he calls it "Obama's plan" which isn't correct, but WTH) which was evaluated by the Congressional Budget Office. The CBO (he says "the administration" which isn't quite right, but WTH) figures every expense that would be imposed by the bill to the federal government and does not figure the private sector savings. For example, over the next ten years the CBO predicts a net cost to the federal government of $1 trillion to ensure 46 million people and put through the insurance reforms such as limiting pre-exiting illness discrimination and allowing more portability. But the total cost of health care-- public and private sector-- is estimated to be $35 trillion over the same ten year period. So, for a 2.6% increase in cost to the nation we would be able to insure an additional 15% of the population... seems like a pretty good deal and certainly cheaper than could be accomplished in the private sector. Furthermore, part of the increased $1 trillion cost factored into the CBO estimate is the fact that people would live longer and thus collect more Social Security and Medicare benefits! Thus we can see yet another disconnect between economics and health care when a plan is punished because it helps people live longer, implying that a true patriots would pay all his payroll taxes for 45 years and then drop dead on his 65th birthday.**

I applaud the author for his thoughtful approach and I am heartened that such a discussion is taking place. I remember 16 years ago having all these same Socratic dialogues with colleagues when I was just finishing residency, and coming to no real solution. Having been in favor of Hillarycare at the time, I attracted the ire of one fellow resident in particular who adamantly opposed any intervention by the government and was convinced that the costs would come down on their own by the power of the free market. Here we are now, a decade and a half later, with costs up from 11% of GDP to 17% of an even larger GDP... and rising parabolically. And I'm convinced more than ever that Hillary was right in 1993 (although perhaps naive that it could be accomplished on such a daring scale)... and the discussion is being broached yet again.

*Some would add obstetrics into the pool of "elective medical conditions" and I would accept that since this is usually an elective, and almost always a preventable, condition.

**This reminds me of the famous story that came out of the Czech Republic after the fall of the Soviet Union. The tobacco companies, looking to gain access to previously unavailable markets, made the pitch to Czech officials to promote cigarette smoking by allowing advertising and decreasing taxation. Philip Morris funded a study that showed that the government would save money in the long run on pensions and health care because smokers would die younger and lung cancer is relatively cheap to treat because the patients die so quickly. Corporations are pricks, really.


Anonymous said...

Glad to see you coming around. As Hillary should have said, "It's the patient, stupid!" Sadly, nothing in any version of Obamacare (written or pondered) addresses this huge structural problem. Instead, we are getting 100 floors added to the top of a 1,000 story crumbling sky scraper nearing collapse. Single payer and public option are Trojan horse gateways to Medicare for all. How could we possibly pay for this?

The French system: not such a good example - it's already hitting the fiscal wall of unaffordability, as all such schemes eventually do.

An excellent illustration of the current extent of cost non-control is at

The illustration was created before the latest CBO estimates so I imagine BO's spending velocity is now closer to 200 MPH. Where's a cop when you need one?

Tony said...

1. Not sure which part of the post made you "glad", but I'm happy for you nonetheless.

2. There is no "version of Obamacare".

3. How could we afford Medicare for all? I would ask, how could we anything but Medicare for all.

4. The French system is approaching "unaffordability" at half the cost of the US'... this gives you some idea of how much we waste here.

5. The youtube video is insane, but I've come to expect nothing less from nonlemming. Bush drives the bus over the cliff, the passengers put a new guy behind the wheel in midflight, and then the drunk in the back blames the new guy because he can't make the bus fly.

Anonymous said...

Obama leadership style: The Inheritor ("It's not my fault.")

I didn't vote for Bush.

My 17-year old son has more leadership in his pinky finger than this neophyte. Seen his approval rating lately? You must live by a river, on the banks of de Nile.

There is no version of Obamacare? I often wonder what BO means when he uses the term "my plan for health care reform." Thanks for clearing this up. Keep in mind that as our nation's leader that what he allows Pelosi and the other far left wingers to craft and put on his desk is his responsibility.

Sorry you found the debt road trip vid "insane". I over estimated your comprehension level. Perhaps a crayon and finger paint depiction of Obama driving a rocket powered sled (vs a school bus) over a cliff would register.

I was wrong. You are not coming around...hopelessly brain washed.

Recommended reading: Anything on Saul Alinsky and the Cloward Piven Strategy. Americans knew next to nothing about BO before the election - study his roots to get a clue as to why he is so hung up on a public option. Offer a rational reason for his light-speed and insanely expansive policy diktats to date. He hates capitalism (though he enjoys the the way he benefits).

You are in a shrinking minority. Independents and centrist Dems are abandoning this radical demagogue in droves. Enjoy your river front view.

Tony said...

I didn't vote for Bush either. See, there is some common ground.

I'm not really sure why you are obsessing on Obama and Obamacare. Not in this blog entry, or really any of my blog entries, do I defend Obama's stance on health care.

I too believe that that he has been AWOL on the health care issue... but I can cut him a break given the clusterfuck he inherited. And if you don't recognize that he inherited one of the worst financial disasters in history*, then you'll just have to join me down by the river.

*His inauguration was marked with record job losses, bank failings, real estate deflation, personal bankruptcies, two wars, stock market at decade lows, health costs going parabolic, record budget deficits...

You just disagree with Obama's management of these crises and that's fair enough. You are not a Keynesian. Fine, maybe you can elaborate on (on your own fucking blog, of course):

1. what you *would* do instead of just whining on and on and on about what you *wouldn't* do. (How does your family put up with that?)

2. What your kid's political platform is because maybe I'll vote for him/her.

3. stop wasting my time with your stupid snarky ignorant bullshit.