Socialized Health Care in the USA

[kandrathe]

I noticed my favorite new socialist villain :), Paul Krugman, weighed in on his column today. He makes the case by lying with statistics, and citing one question in a CBS/NYT poll, "While 85 percent of respondents said the health care system needed to be fundamentally changed or completely rebuilt, 77 percent said they were very or somewhat satisfied with the quality of their own care." He also failed to mention that the poll results revealed "considerable unease about the impact of heightened government involvement, on both the economy and the quality of the respondents’ own medical care."

David Brooks, also of the NYT, offers an alternative analysis, "We’ve built an entire health care system (maybe an entire government) on the illusion of something for nothing. Instead of tackling that basic logic, we’ve got a reform process that is trying to evade it."

I believe we got into our mess when employers (and union demands) started offering health insurance as an employment benefit. Insurance companies keep pressing for higher rates and medical systems use the latest and greatest technology, drugs, and procedures which is their capitalist purpose. The unemployed, result in a large group of people who are without health insurance, and cannot afford to pay for health care due to the exorbitant price. A price which is not based upon what an individual would pay, but supported by the insurance market (which is funded by payroll deductions, and employers). Government also contributes to the rising price of care due to their massive social programs which means that consumers do not make spending on care decisions based upon price. The result is we have the *best*, most expensive health care in the world.

My position is probably draconian, but I believe we need to move towards a system where families pay out of their own pockets for either their care or their insurance. Keep the employers and the government out of manipulations of the health care industry. This way the consumer will again drive the market, and the again help to determine the price and products. Governments role should be limited to helping people who cannot afford to pay for basic coverage (with an allowance or tax deductions). The difficult (nigh impossible) part would be to transition from the mess we have now, to a system that is rationalized by supply and demand.

[Jester]

I noticed my favorite new socialist villain :), Paul Krugman, weighed in on his column today. He makes the case by lying with statistics, and citing one question in a CBS/NYT poll, "While 85 percent of respondents said the health care system needed to be fundamentally changed or completely rebuilt, 77 percent said they were very or somewhat satisfied with the quality of their own care." He also failed to mention that the poll results revealed "considerable unease about the impact of heightened government involvement, on both the economy and the quality of the respondents’ own medical care."

I think Krugman's case is a fair interpretation of the poll. People know what they want, and they say so, but are also aware of the potential pitfalls (and choose a public or semi-public system anyway). I support public health care in both Canada and the UK, but that doesn't mean I'm not aware, and afraid of, the problems with that kind of system.

My position is probably draconian, but I believe we need to move towards a system where families pay out of their own pockets for either their care or their insurance.

That link is a fabulous example of lying by omitting statistics. Any country, no matter how rich, well-run, or humane, can summon up horror stories of how health care was bungled, or people suffered needlessly. The question is what the rates are. How frequently do deaths due to medical failure happen in Sweden, vs. any other country? What effect does this have on disease survival rates, life expectancy, and medical costs? Are those deaths representative, or exceptional? Without statistics, you can't tell these things. All you can do is trade anecdotes.

Keep the employers and the government out of manipulations of the health care industry. This way the consumer will again drive the market, and the again help to determine the price and products. Governments role should be limited to helping people who cannot afford to pay for basic coverage (with an allowance or tax deductions). The difficult (nigh impossible) part would be to transition from the mess we have now, to a system that is rationalized by supply and demand.

How can employers manipulate a free insurance market? Market power? Why would they pay more for the same insurance? That's money out of their pockets. If they buy insurance for their employees, and that is a negotiated part of the contract, how is that different from individuals buying insurance, from the perspective of the market setting prices?

-Jester

[kandrathe]

How can employers manipulate a free insurance market? Market power? Why would they pay more for the same insurance? That's money out of their pockets. If they buy insurance for their employees, and that is a negotiated part of the contract, how is that different from individuals buying insurance, from the perspective of the market setting prices?

It is a huge cost and disruption for an employer to change health care providers, and leads to disgruntling of employees. Therefore, as a business, price inflation is tolerated which exerts and upward pressure higher than the base inflation rate. If health insurance were treated the same as auto insurance, then we'd have more Gecko ads and lower prices.

There is also the problem of "health insurance" being the intermediary between supplier and consumer. The price for a particular treatment or technology is negotiated with the insurance company where it gets lost in a bundle of services, and consumer demand. The consumer only sees (the employee share of) the aggregate averaged price based on the size of his "group". The employer, factors in the cost of benefits into the cost of employment resulting in lower wages (while insurance benefits are counted as taxable income).

[Jester]

I don't think any of this is a convincing argument against insurance being priced at a market rate, perhaps slightly adjusted for transaction costs. Insurers, providers, employers, unions and individuals, if they are rational, are all bargaining against one another, and none has an incentive to take less than they can get, or offer more than they can get away with.

Employers look at their tax situation, the wages they have to pay out, and the benefits package they offer, and adjust their collective bargaining accordingly. Unions do the same. This should not alter the price of health care more than a small amount, since nobody has market power; there are a lot of insurers, a lot of employers, and a lot of unions, and therefore nobody has a particularily credible threat.

Government action works differently, but to me, that's one of the more convincing arguments for going to a single-payer system, even one with an opt-out, rather than attempting a hybridized system. Most such hybrids simply end up accumulating rents for some company or another, because government power distorts the market. Either get rid of the government element (surely your solution) or get rid of the market (mine).

-Jester

[--Pete]

Hi,

. . . medical systems use the latest and greatest technology, drugs, and procedures which is their capitalist purpose.

Yeah, they just do it for the money. You can save just as many people by bleeding as you can by all that fancy new crap. X-rays are really just faked pictures. And antiseptic procedures are just based on superstition. Blah blah blah.

Do you even think about what you are spouting? Or is it sufficient for you to be ranting about Obama?

You are losing credibility faster than a bed ridden patient loses muscle tone -- and, believe me, that's fast.

--Pete

[Ashock]

What I believe the NYT poll misled ppl about is that it won't cost families $500, but it would cost $1000 per household per year for 10 years, so 10k for approximately 12 million out of 50 million or so uninsured in the country. Hardly a worthwhile proposition. Meanwhile the deficit will grow. It's all good though, we'll just print more old presidents.

It's cool though. I'm sure my 73 year old father did not really need a triple bypass after his heart attack anyway. Well, he better not get another one in 2-3 years or he will be deemed not cost containment-worthy by the government. I love socialized medicine. Ppl over 70 or so have had enough time on this earth anyway. Well, unless they are politicians of course.

[kandrathe]

It's cool though. I'm sure my 73 year old father did not really need a triple bypass after his heart attack anyway. Well, he better not get another one in 2-3 years or he will be deemed not cost containment-worthy by the government. I love socialized medicine. Ppl over 70 or so have had enough time on this earth anyway. Well, unless they are politicians of course.

My 96 year old grandfather wanted knee replacement surgery, until his kids talked him out of it.

[kandrathe]

Yeah, they just do it for the money. You can save just as many people by bleeding as you can by all that fancy new crap. X-rays are really just faked pictures. And antiseptic procedures are just based on superstition. Blah blah blah.

I'm not talking about the people who provide the care, because they mostly genuinely do care about improving lives. I'm talking about the business of health care. There is no incentive for the business of health care to scrimp, or reduce the costs incurred by any patient when its "the insurance company who pays". As long as the insurance company will pay for whatever procedures are asked, then the practitioners will have carte blanc. With malpractice on top, there is every incentive, both financial and legal to perform every test (without much concern for expense) to confirm a diagnosis. There is a big difference between getting an x-ray(~$250), versus getting an MRI ($1000 to $3500). I'm not an advocate of Dark Ages medicine either.

I'm a pretty pragmatic person, so all in all, for all the money we spend on health care in the USA, where does it show in our mortality rate? The mortality rate seems to be pretty stable at ~8.0 to 8.8 per 1000 for the past 3 decades. While, "In the United States, which has had both a high level of health spending per capita and a relatively high rate of real growth in that spending, the share of GDP devoted to health grew from 8.8% of GDP in 1980 to 15.2% of GDP in 2003 (Exhibit 5)." (source) Our health care per capita is at least double to triple other developed nations.

Also, from that same source above, "Despite this relatively high level of spending, the U.S. does not appear to provide substantially greater health resources to its citizens, or achieve substantially better health benchmarks, compared to other developed countries."

I'm not against Obama per se, but against anyone in Washington (of whatever party) who attempts to further make the USA more of a socialist state than it already has. The trend we need is for people to be more responsible for their own life long well being while they are young and healthy, rather than expect the State to collectively tax the people at a high rate to redistribute wealth (economic vitality) to the less productive, and in this case infirm.

[Jester]

I'm not against Obama per se, but against anyone in Washington (of whatever party) who attempts to further make the USA more of a socialist state than it already has. The trend we need is for people to be more responsible for their own life long well being while they are young and healthy, rather than expect the State to collectively tax the people at a high rate to redistribute wealth (economic vitality) to the less productive, and in this case infirm.

Weren't you arguing not some minutes ago that the state does have a role in doing exactly that, providing for those who are poor ("less productive") and infirm? Or have we now moved past that socialist heresy to the true gospel of social Darwinism?

-Jester

[Crusader]

Sometimes I'm happy to live in a socialist paradise.

After reading this thread, I have a happy moment.

[kandrathe]

Weren't you arguing not some minutes ago that the state does have a role in doing exactly that, providing for those who are poor ("less productive") and infirm? Or have we now moved past that socialist heresy to the true gospel of social Darwinism?

No.

Yes, I'm libertarian, but not to the illogical level that begets "social darwinism". There is no ideal solution, and we need to acknowledge that there are people in our society who are too young, or too infirm to provide for themselves. In my way of thinking, that is not some magical age where suddenly your limbs fall off and you become a ward of the state. Just as with drugs, I can recognize the malevolent effect they have on the society, yet I can reject criminalizing drug use as a remedy (as Lisbon has discovered). I'm advocating systems that encourage, or require personal responsibility for ones own problems when that person is capable of resolving their own issues. This type of social care would typically find a slim number of people (<10%) who cannot care for themselves, and require the rest of society to come to their aid (dependency support ratio of 9 to 1). There is the ages old argument of children, versus elderly, but the fact is that dependent children are much, much, cheaper than the elderly, and the extremely elderly. That is, unless we return to the days when parents move back in with their children, and begin to consume much less health care.<blockquote>"Absent a sizable increase in labor force participation, the demographic transition
we are about to undergo in this country will require a reduction in per capita consumption
relative to what it could have been in the absence of demographic change. Given this
basic fact, the main macroeconomic policy questions for the nation are (1) How much
can we (and should we) raise labor force participation? and (2) How do we want to
allocate the burden of reduced consumption over time?"<!--fontc--><!--/fontc--> (source) </blockquote> Each of us must attempt to carry our own load, and a little extra for those of us who due to circumstances of birth, or disease, or accident become unable to care for themselves. If each of us who are healthy did all they could to prepare themselves for the day that they may become unable to continue to provide for themselves, then I think each of us would be content that it was fair. This is a concept of social benevolence we can all accept. In fact, if we talked about HCSA, and that unspent money at the time of your demise went to a general fund, then I believe that too would be acceptable to most.

The US already has a single payer system, reserved for the "elderly" based on that magical age. It consumes about 20% of the Federal Budget, exceeds the amount spend on Defense and will exceed the size of SSI in the next few years. Within the next decade, SSI, Medicaid, and Medicare will consume over 50% of the Federal budget. Our government has been so very irresponsible with every one of its social programs with them all running bankrupt requiring massive borrowing to sustain. Why would we ever trust the US government with running something as massive as a health care system?

Socialism is the promise of prosperity, equality, and security with the result of equality only in poverty, suffering, and tyranny. We only need to look at our current Ponzi scheme to see why the continued path of borrowing to pay for services today will have catastrophic results at some time in the future. Perhaps you believe in that fantasy that the debt never has to be repaid, but I believe that we are reaching that point where continued borrowing will destroy our GDP, and thus our ability to ever pay down that debt. When you run a personal budget, you know you are in trouble when you need to borrow money to pay for every day expenses, like groceries. That is what the US government is doing, they are borrowing money not for the extraordinary events, but to run the every day, year on year expenses.

[ShadowHM]

Socialism is the promise of prosperity, equality, and security with the result of equality only in poverty, suffering, and tyranny.

:lol::lol::lol:

*hands kandrathe a prize for fun sentence structure*

*looks around in vain for evidence of the equality in poverty, suffering and tyranny caused by the socialism evident in her homeland*

*goes back to lurk mode*

[DeeBye]

Why do people rant against government-run health care as some kind of scary socialist monster, when they have no problems with government-run schools, garbage pickup, mail and all kinds of other public services?

[Swiss Mercenary]

Why do people rant against government-run health care as some kind of scary socialist monster, when they have no problems with government-run schools, garbage pickup, mail and all kinds of other public services?

Because they think the private sector is less wasteful.

I do have to wonder, what they would call the profit margin that every middle-man involved in the private sector makes...

[Jester]

Why do people rant against government-run health care as some kind of scary socialist monster, when they have no problems with government-run schools, garbage pickup, mail and all kinds of other public services?

I think you're missing the part where Kandrathe is against government-run schools, garbage pickup, mail, and all kinds of other public services.

-Jester

[DeeBye]

I think you're missing the part where Kandrathe is against government-run schools, garbage pickup, mail, and all kinds of other public services.

I guess I am. Nothing left for me to see here. I know how this is going to turn out already.

[kandrathe]

I think you're missing the part where Kandrathe is against government-run schools, garbage pickup, mail, and all kinds of other public services.

Yes, I am. :D

I'm glad you mentioned garbage.

Where I live, the garbage is picked up by one of three firms given access by the local government based upon their willingness and capability to service our cities waste problems. The contracts are competitive and renewed every two years. The businesses are allowed to compete for our garbage and recycling. Our prices are surprisingly lower, and our service is prompt and efficient which is unlike some of our neighboring cities who give the monopoly to the lowest bidder. It's amazing how government doesn't need to be the service provider, and yet the job can still get done cheaply and with high quality.

Now, if only the government (State) would realize that it might also work that way with schools. Oh, wait, we have, back in 1991. Minnesota is a leader in the US in transitioning from traditional government run public schools to non-profit charter schools. Government acts as a watch dog, and for now supplies the charter school with a per capita fund equal to what it would fund a public school. Yes, taxes still pay for education, but the market is flourishing with choices and schools need to meet standards and compete for enrollment.

We don't have anything like a free market providing police and fire protection, so our city worked out a deal with a few neighboring cities to create a combined service to cover the larger area, rather than each city funding their own. It's resulted in a much reduced price for better coverage.

Mail (letters at least) is a dinosaur anyway, and the US Parcel Post is still the least reliable way to ship a package. UPS, Fedex, and others do a much better job at a competitive rate. No business that I've ever worked with has relied on the US post office for anything important to the firm.

No, in my way of thinking there is a role for government, but it is a limited role to supply the necessary services that businesses cannot provide (like being the watchdog).

[Skandranon]

While, "In the United States, which has had both a high level of health spending per capita and a relatively high rate of real growth in that spending, the share of GDP devoted to health grew from 8.8% of GDP in 1980 to 15.2% of GDP in 2003 (Exhibit 5)." (source) Our health care per capita is at least double to triple other developed nations.

It takes some massive ideological blinders, or epic cognitive dissonance, to cite these statistics from nations whose health care is all more socialistic than the United States' and somehow come away concluding that socialization is the problem.

[Ashock]

Why do people rant against government-run health care as some kind of scary socialist monster, when they have no problems with government-run schools, garbage pickup, mail and all kinds of other public services?

Because government inevitably screws it all up. Government usually has only the best intentions in mind when it thinks of new sweeping programs. Unfortunately, beurocrats do not ever consider the consequences to their actions. While it is regrettable in the first case, and irrelevant in the second, in the case of medicine, it is literally deadly.

[kandrathe]

I guess I am. Nothing left for me to see here. I know how this is going to turn out already.

So... Let's talk about Canadian National, and Canadian Pacific. They seem to be doing much better in private hands.