The Atlantic - Latest Comments in Random Thoughts on Health Care

Re: Random Thoughts on Health Care

JoshinHB — Tue, 03 Nov 2009 01:09:58 -0000

Stonetools

see these fine examples of britains non socialist healthcare

http://www.dailymail.co.uk/news/article-1211950/Premature-baby-left-die-doctors-mother-gives-birth-just-days-22-week-care-limit.html

http://www.dailymail.co.uk/news/article-1218689/Grandmother-dies-ovarian-cancer-sent-home-FIVE-times-trapped-wind.html

Re: Random Thoughts on Health Care

JoshinHB — Mon, 02 Nov 2009 18:03:30 -0000

Drew,

It's amazing that "progressives" worship at the alter of democracy (majority rule uber alle) until a majority thinks the progressive are lazy jack offs that are full of shit. Then the "progressives" are some kind of vanguard that must force a better way on the majority.

Re: Random Thoughts on Health Care

MikeR — Mon, 02 Nov 2009 17:05:27 -0000

Just watched the bloggingheads.tv episode w Matt Lewis and Tim Fernholz. Fernholz started right off by saying that the public option will save money, as if everyone knew it. He also mentioned that people are saying that the bills cost a trillion dollars, and of course that isn't true at all. Lewis did not object. Frustrating. Megan, we need you on bloggingheads, I think.

Re: Random Thoughts on Health Care

Stan — Mon, 02 Nov 2009 16:02:27 -0000

If this article

http://content.nejm.org/cgi/content/short/349/8/768

from the New England Journal of Medicine comparing medical insurance administrative costs in Canada and the US is right, Megan is talking through her hat.

Re: Random Thoughts on Health Care

Megan McArdle — Mon, 02 Nov 2009 13:33:36 -0000

Salaries are a drop in the bucket on health insurance fees--you will not generate any significant cost savings by forcing every health care CEO to work for a dollar a year. The much maligned "administrative costs" are one of the reasons that Medicare and Medicaid are the most vulnerable to fraud:

http://www.fbi.gov/publications/financial/fcs_report2007/financial_crime_2007.htm#health

The insurance industry spends a great deal of money rooting out fraud. That is expensive, but not as expensive as the fraud . . .

Re: Random Thoughts on Health Care

Stan — Mon, 02 Nov 2009 10:21:52 -0000

I'm unaware of estimates of how much fraud occurs in payments by the private medical insurance industry. Until I see this amount, I can't accept your reasoning. Certainly, any amount of dishonesty is unacceptable, and I support having Medicare and Medicaid check more extensively for fraud. But taking the American insurance industry with its bloated salary structure and heavy costs for promotion as a model strikes me as absurd.

Re: Random Thoughts on Health Care

torourke — Mon, 02 Nov 2009 09:39:24 -0000

Stan,

Jeffrey H. Anderson had an eye-opening post over at the Weekly Standard about this issue. He writes:

"As 60 Minutes reported last week, Medicare fraud is rampant and has now replaced the cocaine (ahem) business as the major criminal activity in South Florida. Both 60 Minutes and the Washington Post report that Medicare fraud now costs American taxpayers roughly $60 billion a year. That may sound like a lot of money, but surely it pales next to the extraordinary profits of private insurance companies, right?

Well, let's see.... Last year, the profits of the ten largest insurance companies in America were just over $8 billion -- combined. No single insurance company made even five percent of what Medicare reportedly loses in fraud.

While we're making comparisons, in its real first ten years (2014-23), the Senate Finance Committee bill would cost $1.7 trillion. At the rate of last year's profits, the combined ten-year profits of America's ten largest insurance companies would be $83 billion -- five percent of the costs of the Senate Finance Committee bill. Eighty-three billion dollars may not buy you much in comparison with BaucusCare, but -- on the bright side -- that ten-year tally is somewhat more than what Medicare loses each year in fraud.

So, the next time someone alleges that government-run health care is cheaper because of "lower administrative costs" -- a truly preposterous claim on its surface -- these numbers would be good ones to have at the ready: $60 billion in annual Medicare fraud, $8 billion in combined annual profits for America's ten largest insurance companies."

Re: Random Thoughts on Health Care

Stan — Mon, 02 Nov 2009 08:51:28 -0000

A day or so ago I gave a link showing that administrative costs for American insurance companies are much higher than those for insurance companies in countries that use a Bismark style health insurance system, e. g. Switzerland, Germany, and the Netherlands. For some reason Megan or whoever administers this blog wouldn't accept my post, and I don't feel like looking my link up again.

You may be right that Medicare doesn't spend as much as it should on fraud protection, and it may also be true that Americans are more crooked than the Swiss, the Germans, and the Dutch. It's also true, and this time it's not a maybe, that American insurance companies pay a lot more than their European competitors to upper management and they spend a lot more than the Europeans on advertising, lobbying, and political contributions. I expect that all three factors, more checking of claims by American companies, the usual American practice of paying sky high salaries to the people who decide the salary structure, and promotion in the broadest sense, contribute to high American administrative costs. Apparently you view this as a good thing. I don't.

Re: Random Thoughts on Health Care

naturalfake — Mon, 02 Nov 2009 08:28:44 -0000

See the surprising connection between Obama's push for nationalized medicine, NY-23, and the question:

WHO WOULD STALIN PURGE?

http://naturalfake.wordpress.com/2009/11/02/who-would-stalin-purge

Re: Random Thoughts on Health Care

...Max... — Sun, 01 Nov 2009 20:53:08 -0000

it's crazy to make 70% worse off to help make 30% better off.

It's certainly not crazy.

Yeah, until the music stops. Next Republican Congress will be well advised to look into structural changes in spending on higher education as well as the regulations governing the use of the broadcast spectrum, among other things. Not to mention the application of anti-cartel laws to unions.

Re: Random Thoughts on Health Care

...Max... — Sun, 01 Nov 2009 20:48:54 -0000

Thankfully, the majority of the country disagrees.

The majority of the country is stocking up on tar and feathers at the moment. Grab your place near the middle of the rail to get some coverage from the incoming produce.

Re: Random Thoughts on Health Care

Jasper — Sun, 01 Nov 2009 13:54:59 -0000

I suspect that many — maybe most — Americans, if they were suddenly dropped into an average British city (e.g., Manchester), would consider the U.K. to be a socialist nation.

And I suspect you've never visited the United Kingdom. Simply walk down any High Street in Britain -- and certainly any major metropolis like Manchester -- and you'll see ample evidence of a thriving free enterprise system: zillions of shops, restaurants, myriad advertisements pushing this or that sale, commercial vehicles, etc. You'll see, in other words, a lively and competitive commercial culture similar to what's on offer in the USA. I mean, if your argument is that government guaranteed, universal health insurance obviates the free market bonafides of a polity, then you're saying the US is the rich world's only free market system. Which is nuts. The US doesn't even have the smallest public sector among rich countries.

Re: Random Thoughts on Health Care

Jasper — Sun, 01 Nov 2009 13:46:55 -0000

70% of the people are happy with their health insurance it's crazy to make 70% worse off to help make 30% better off.

JoshinHB: It's certainly not crazy. What it is is non-libertarian. You could argue that the 90% of the population that doesn't receive Social Security benefits is worse off (since their incomes are reduced via payroll taxes) in order to help the 10% who do receive such benefits. Similarly, you could argue people without children are worse off by having to fund schools for those who do.

This course of action, in fact, is what we do all the time. It's called civilization.

And of course, it's highly debatable whether or not the 70% you cite actually will be be "worse off." I'd say for most Americans, the fact that -- just like the citizens of all other rich countries -- they'll always be covered by comprehensive medical insurance constitutes a substantial increase in economic security. That's a real, tangible benefit.

Re: Random Thoughts on Health Care

JoshinHB — Sun, 01 Nov 2009 10:35:59 -0000

"I don't question your motives, but I think your philosophy benefits the rich way too much, regardless of your intentions. During the past thirty years of Republican dominance we have become a nation of haves and have-nots."

There hasn't been a free market in health care for the last 70 years.

The system of pre-paid health care that we call health insurance, was a direct result of government wage-price controls during WWII.

When the war ended, the employer based "health insurance" system was maintained by giving it preferential tax treatment, when top income tax rates were 90% this was a siginificant subsidy by the governement.

The Insurance industry monopolies were enabled by government action, namely, allowing states to regulate insurance coverage within each state. This is clearly a violation of the Interstate Commerce clause in the constitution.

Cost were driven up by the states mandating what procedures had to be covered. By All0wing the tort system to go crazy in medical cases.

By using regulations, supposedly to protect the public, to restrict the supply of healthcare.

Insurance industry irresponisblity, denying legitimate claims, was enabled by government not allowing people to sue their insurance providers.

The current fucked up health insurance system was created, every step of the way, by govenment action.

More government involvement will only make things worse.

Re: Random Thoughts on Health Care

Dick King — Sat, 31 Oct 2009 22:02:01 -0000

That conservative news magazine called "Sixty minutes" last weekend [10/25] described how perhaps 10% or 15% of Medicare was spent on outright fraud.

Nothing soft; blatantly billing Medicare for services to patients who never receive the services.

So Medicare supposedly has lower administrative costs than insurance companies. What do we get for that administrative money? Perhaps they greatly underspend for fraud prevention?

-dk

Re: Random Thoughts on Health Care

Fletch — Sat, 31 Oct 2009 21:33:14 -0000

Stan-

It isn't a "study", bur it seems independent...

Re: Random Thoughts on Health Care

ian — Sat, 31 Oct 2009 20:50:32 -0000

During the past thirty years of Republican dominance we have become a nation of haves and have-nots.

You poor naif. It will just be a different set of 'haves' for a while.

Re: Random Thoughts on Health Care

circleglider — Sat, 31 Oct 2009 17:47:24 -0000

Britain is not a socialist nation. It is much less left-wing, in terms of economic philosophy and welfare provision, than many other European countries.

I suspect that many — maybe most — Americans, if they were suddenly dropped into an average British city (e.g., Manchester), would consider the U.K. to be a socialist nation.

And I suspect they would perceive many of the "other European countries" to be communist nations if similarly familiarized.

And before someone goes on another rant about how the U.S. is actually a left-of-center nation, please review in detail the latest findings of the well-publicized Gallup Poll here: http://www.gallup.com/poll/123854/Conservatives-Maintain-Edge-Top-Ideological-Group.aspx

Re: Random Thoughts on Health Care

Stan — Sat, 31 Oct 2009 17:37:01 -0000

I don't question your motives, but I think your philosophy benefits the rich way too much, regardless of your intentions. During the past thirty years of Republican dominance we have become a nation of haves and have-nots. I think this is bad for the economy and for social stability, and it affronts my sense of decency. So we're going to differ, I hope in a civil way.

Re: Random Thoughts on Health Care

William H Stoddard — Sat, 31 Oct 2009 17:16:27 -0000

Stan,

Thanks for the links. I'll take a look in a day or two when I have a little more free time.

As to Adam Smith, that asserts that people in business WANT to raise prices. Of course they do. But there is nothing whatever in Smith's comment that specifies that they use any particular method of doing so. My view of regulation is that regulation itself creates greater opportunities for businesses to raise prices, through well-understood processes called rent-seeking and regulatory capture; and that in fact raising prices with the connivance of government is so much more efficient than purely private agreements that it is overwhelmingly the preferred route to monopoly power.

A classic study of this process is Gabriel Kolko's "Railroads and Regulation."

One of the characteristic misunderstandings of libertarianism from people further to the left is to suppose that libertarians are enthusiasts for the free market because we love big business and think the free market will give it unchecked power. In fact, most libertarians are profoundly mistrustful of big business, and favor the free market precisely because we see it as the most effective check on the power of big business . . . a judgment that most businesses agree in, as can be seen by their mobilizing to oppose any proposal to do away with the subsidies, regulations, systems of licensure, and other government interventions that protect their monopoly rents. The reaction of all the medical industries over the past year has not been to oppose health "reform": It has been in the spirit of "We've already found out what you are; now we're haggling over the price."

Re: Random Thoughts on Health Care

Stan — Sat, 31 Oct 2009 16:45:25 -0000

William H Stoddard,

For the Congressional Budget office report, see

http://www.cbo.gov/ftpdocs/66xx/doc6639/hr2355.pdf

and for the Rutgers study, see

http://www.cshp.rutgers.edu/Downloads/7130.pdf

Regarding your view of regulation, I think you overlook Adam Smith's observation that

"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."

Re: Random Thoughts on Health Care

Ryan W. — Sat, 31 Oct 2009 15:16:43 -0000

Stan -

'Cheaper' means that you pay less money and get the same or better results.

I hope you're not using lifespan as a proxy for healthcare effectiveness here. Lifestyle factors (exposure to violence, drug use, diet and lifestyle), not to mention how stillbirths vs. live births are calculated have so much more of an influence on lifespan than access to healthcare. Japanese-American lifespan is similar to the lifespan of Japanese in Japan, not the national American average. Also, the effectiveness of a healthcare system is supposed to be measured by the portion of the population which is exposed to the system. I'm concerned because many NHC advocates don't run their numbers that way.

Also, we need to account for free rider effects. Megan has done a good job of pointing out that Europe is basically free-riding on American innovation. We could fix that in the way of pharmaceuticals by just allowing drug reimportation, so that the US gets the same deal that other countries get and fast-tracking drugs approved in Europe. At the very least, this would help make the statistics more honest about cost of care relative to other countries. (Though I WOULD like to see more naturopathic medicine used, as in Germany. But in the US that isn't even on the table for a NHC system. So anyone who wants that, as I do, has to pay twice.) Eliminating innovation by killing the higher-end services for the sake of overall cost savings has long-term effects, though, that most analyses don't seem to even try to address.

France's single payer system is a little more expensive the Great Britain's, but still vastly better than ours in terms of outcomes and per capita expenditures.

Again, to what extent is this a matter of taking people's hummers and using the money to buy other people compact cars? Or would you be in favor of that?

And are you sure you're accounting only for outcomes which are determined by exposure to the healthcare system? I question that. A car that runs at 55MPH but can only be afforded by half the population may cost more per person than a vehicle that runs at 30MPH but can be afforded by everyone.

In an honest country, it would come from lowering administrative costs in the insurance industry, which are much higher here than abroad:

It's my understanding that some of the administrative costs for government systems are shoved off onto other areas of government. Perhaps it would be possible to get actual savings this way. I don't know well enough to say. But it seems to me that government regulation usually ads an aspect of rigidity to a system. Buckminster Fuller's ideas about architectural engineering, for instance, were difficult to implement because there was strict regulation on how houses should be built. I'm concerned that a US NHC system will be less focused on providing effective care and more on providing a 'standard of care.' Something which the unusually high threat of lawsuits compared to other nations has already made a feature of our system. I'm curious what malpractice insurance is in other countries...

Re: Random Thoughts on Health Care

William H Stoddard — Sat, 31 Oct 2009 14:53:57 -0000

Stan: Not having seen either of those studies, I'm not prepared to take them as authoritative. I don't feel able to judge whether their methodology is sound. Do you have links to provide?

It seems to me that given that there are substantial differences between the states in how much a basic health insurance policy costs, letting people buy from out of state would have to cut costs . . . at least for people in outrageously expensive states like Massachusetts and New York.

As to weakening regulation of the industry, I think that would be a good thing. The current medical insurance industry is a prize example of regulatory capture. Note that Massachusetts and New York, which have high costs, also have highly regulated medical insurance industries. This is not an accident. The whole theory that regulation serves the public interest is an appealing fantasy; regulation largely serves the interests of the dominant firms in the regulated industry, with a little sprinkling of concessions to popular resentments.

Re: Random Thoughts on Health Care

Careless — Sat, 31 Oct 2009 14:05:09 -0000

Stonetools: It's much more difficult to change third rail issues in democratic systems than totalitarian systems. We know that Social Security is a looming disaster but our politicians will not fix it. The NHS is a much more dangerous rail than SS, no matter how good or bad you think it is.

Re: Random Thoughts on Health Care

Stan — Sat, 31 Oct 2009 13:10:24 -0000

William H. Stoddard, the Congressional Budget Office and a study at Rutgers University found that allowing insurance companies to sell across state lines would have a negligible effect on insurance prices. For what it's worth, my personal opinion is that a proposal like this would also weaken regulation of the industry. If you can find some independent study that supports your point of view, please provide a link.