Mass health

Paul Krugman says that it's not fair to accuse the Massachussetts health care program of costing $400 million more than originally projected.

The problem is that they’re all wrong. People are confusing an increase in costs that was largely (not completely) anticipated — after all, the plan is supposed to cover more people, and subsidize their coverage — with a cost overrun.

The fact is that the plan does seem to be making a serious dent in the number of uninsured. One thing that has come to light is that there may have been more uninsured people in Massachusetts to start with than previously estimated, so there’s a steeper hill to climb. But claims that it’s all a disaster are based on nothing but bad journalism.

That link to the Healthy Blog post seems extremely misleading. Paul Krugman seems to be claiming that the post proves that the cost was actually mostly anticipated. But it doesn't. The unanticipated cost of $400 million is pretty much a direct quote from the budget, one that seems to be backed up by the statements of the governor and budget officials. The state budget is a byzantine hive of confusingly organized data, but it seems safe to say that the cost overrun portion of the spending growth is now in the hundreds of millions.

The main gist of the post linked by Professor Krugman is that the cost to the state of Massachussetts is less than $400 million, because the Federal government will be kicking in part of the cost. This is, of course, brilliantly irrelevant to any argument over national health care, since the Feds don't have another government to contribute to the kitty.

Comments

Whenever I see reasoning such as that, I am reminded of the following from a The Simpsons episode in which Homer is attempting to make money off of waste grease from cooking:

Homer: Okay, boy. This is where all the hard work, sacrifice and painful scaldings pay off.
Clerk: Four pounds of grease. That comes to... sixty-three cents.
Homer: Woo-hoo!
Bart: Dad, all that bacon cost twenty-seven dollars.
Homer: Yeah, but your mom paid for that.
Bart: But, doesn't she get her money from you?
Homer: And I get my money from grease. What's the problem?

Posted by Yancey Ward | February 4, 2008 11:23 AM

Thank you for clarifying this, you are so totally right.

Posted by Tyler Cowen | February 4, 2008 11:45 AM

I'll take this kind of "bad journalism" over Krugman's economics any day.

Posted by Andrew | February 4, 2008 12:06 PM

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people? "Health care spending accounts" won't do diddly. We already have those, called section 125 or "cafeteria" plans, and have had them for years; costs continue to skyrocket. We can't simply declare that people will be more healthy. We can't let the free market decide and call ourselves human beings. So what's the answer?

Posted by liberalrob | February 4, 2008 12:09 PM

I'm interested to see how Krugman will attempt to defend Hillary's ridiculous interest rate freeze idea. If his brain gets the better of his ambition, he won't touch it with a 10-foot pole, but we all know that's a bit much to ask... actually, here's a preview: 1. A lot of people who don't want to freeze interest rates are Republicans. 2. Now we all know every single Republican is a vile bigot with a Klan hood in his closet. 3. If you're against freezing interest rates, you're a racist. QED.

Posted by publius | February 4, 2008 12:11 PM

liberalrob, I think you forgot one more premise: We can't let the state decide and call ourselves human beings.

Posted by Skullberg | February 4, 2008 12:16 PM

liberalrob:

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

I'm a conservative. I don't have to believe there's a solution.

That said, if you just froze the standard of care at, say 1990, we could probably cover everybody trivially. The problem is that care technology is advancing faster than costs are deflating... I do see the healthcare sector getting more efficient, in fits and starts, and suspect that the problem will more-or-less solve itself in 30 years if we don't screw it up in the meantime.

Which, presumably, we will.

Posted by Mike Earl | February 4, 2008 12:17 PM

liberalrob,

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

What evidence is there that health care is increasingly out of reach for people? As far as I can tell, the vast majority of Americans have access to far better health care than their parents did, and the quality and quantity of health care is continuously improving.

Posted by Mixner | February 4, 2008 12:18 PM

"People are confusing an increase in costs that was largely (not completely) anticipated — after all, the plan is supposed to cover more people, and subsidize their coverage — with a cost overrun."

So, people have confused the cost exceeding the budget with the cost exceeding the budget? I can see why they might.

Posted by iron pimp hand | February 4, 2008 12:20 PM

None of which is to say there aren't things we should do - clearly we should break the tax-enforced insurance-coupled-to-employers at a minimum, and that probably requires some other form of pooling or savings accounts...

Posted by Mike Earl | February 4, 2008 12:22 PM

This is, of course, brilliantly irrelevant to any argument over national health care, since the Feds don't have another government to contribute to the kitty.

Of course, if you believe that it's profoundly immoral for people to go without health care because they can't afford it--in arguably the most economically powerful country in the history of the world-- the cost overruns are also "brilliantly irrelevant".

Posted by Freddie | February 4, 2008 12:28 PM

We can't let the free market decide and call ourselves human beings.

Why not? We haven't tried that yet.

Posted by "Mindles H. Dreck" | February 4, 2008 12:28 PM

What evidence is there that health care is increasingly out of reach for people? As far as I can tell, the vast majority of Americans have access to far better health care than their parents did, and the quality and quantity of health care is continuously improving.

I can think of 47 million pieces of evidence off the top of my head.

Posted by Freddie | February 4, 2008 12:29 PM

I'm very happy to see people like Krugman defending Mass Health because it means they're taking some ownership of it. When the law was passed, I agreed with people like Arnold Kling who said that because this wasn't a total gov't solution, it would be disavowed by the left and the failures would be blamed on not enough gov't. So far that hasn't happened, which if it continues, could ultimately make the law worthwhile (even though as a MA resident, I'm paying for part it; I guess libertarians care about more than money after all).

Posted by Josh | February 4, 2008 12:33 PM

Freddie, you're assuming that every single uninsured person is uninsured because s/he lacks the ability to get insurance, rather than, perhaps, making the choice to go uninsured for reasons both good and bad.

Posted by Rob Lyman | February 4, 2008 12:38 PM

Freddie, the 47 million number has well been debunked for the purposes you are using it for:

10 M are not citizens and wouldn't be covered under plans I have seen.

18 M are in the top half of income distribution and choose not to buy health insurance

Millions of people are eligible for medicaid but have not enrolled, and would if they needed to

A quarter of the uninsured have been offered employer-provided insurance but declined coverage

see The NY Times

Posted by Skullberg | February 4, 2008 12:41 PM

Well, we could just outlaw all this new expensive technology and let people die. We could outsource it to China, but I'm not too keen on letting people who can't make non-toxic dog food care for my health.

We could let people buy what they want and can afford while we search for cosmic justice. Perhaps I should phrase that as equal outcomes for all so as not to ruffle too many feathers. As my DI said, "life's unfair, and then you die."

Posted by MarkD | February 4, 2008 12:43 PM

Freddie,

Of course, if you believe that it's profoundly immoral for people to go without health care because they can't afford it--in arguably the most economically powerful country in the history of the world

People go without health care because they can't afford it in every country in the world. You don't seriously believe that rich people in Britain and Canada and France can't buy more and better health care than poor people, do you?

I can think of 47 million pieces of evidence off the top of my head.

What pieces of evidence would those be? You do realize that health insurance is not the same thing as health care, don't you?

Posted by Mixner | February 4, 2008 12:44 PM

what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

if you believe that it's profoundly immoral for people to go without health care because they can't afford it

Well, perhaps first the problem should be defined and quantified. In what sense does the health care go "increasingly out of reach"? Does the share of health care costs as a percentage of family budget grow? For what percentage of families? What does the dynamics look like (e.g. might there be a correlation with aging of disproportionately numerous baby boomers)? How many people do actually go without health care (completely? partially? if partially then what are the parts they are forgoing?) as opposed to without health insurance (they might not need it, or feel they don't need it).

Everything I've seen so far had to do with "nationwide health care spending" numbers or perhaps "per capita health care spending". Tells me diddly squat. My personal health care costs have certainly increased over the last 15 years (surprisingly enough, no one in my family is getting any younger) but I am fairly positive they have shrunk as a percentage of budget. Are there some aggregate numbers that would help us tell whether health care becomes prohibitively expensive or whether we have become affluent enough to purchase ever increasing quantities of it? And if certain part of population is being left behind, how big is it?

Posted by ...Max... | February 4, 2008 12:44 PM

None of which is to say there aren't things we should do - clearly we should break the tax-enforced insurance-coupled-to-employers at a minimum, and that probably requires some other form of pooling or savings accounts...

I like the idea of giving those who buy their own insurance (or who pay for their own health care costs) the same tax benefits as employers who buy it for their employees. Association Health Plans so smaller employers and other private organizations can pool together to buy plans at rates comparable to the larger employers would also be a good step. But most of all, we need to get back to the idea that health “insurance” is supposed to pay for things like major medical (e.g. hospital stays, catastrophic illnesses) rather than acting as a form of “prepaid health care.” Consumers should be able to buy a policy anywhere in the country without having to all of the added on unfunded mandates that various pressure groups lobby to require insurance policies to provide each of which increases the cost of insurance, leading to more people having no insurance coverage, and the inevitable whining about how the “free market doesn’t work” from the very people who pushed for the very government policies that make health insurance less affordable.

Posted by Thorley Winston | February 4, 2008 12:50 PM

Reponse to liberalrob's question "what's your solution...":

Sign up everybody who makes above a certain income threshold for some kind of minimal national health plan that covers ONLY catastrophic health costs. Make the cost based on age, and deduct it automatically from their paycheck like Social Security.

Make it voluntary, but auto-opt-in-- that is, you're signed up unless you fill out a form and say "Thanks, but no thanks."

If you opt-out, decide not to buy insurance, and get sick-- tough cookies.

Everybody who makes below a certain income threshold gets automatically signed up for Medicaid, at no cost.

Oh, and of course either get rid of the employer tax deduction for health insurance or extend it so the employees get the same tax break if they buy their own insurance...

Posted by Gavin Andresen | February 4, 2008 12:55 PM

The value of the 47 million figure has proved controversial. It's not surprising that I find the evidence supporting it more convincing than the evidence against it, and it's not surprising that you who are opposed to universal health coverage find the opposite. But, again, if like me you find it morally indefensible for those who want health care to be unable to get it, or to be unable to do so without causing economic havoc on their lives, then the issue of how many loses a great deal of significance. If the number is one hundred million or one million or one, something has to change. I do find the notion that I'm supposed to care less because the figure of who can't afford health care is 35 million instead of 47 million hard to understand. I equally am unimpressed by appeals to the legal status of those who are uncovered or undercovered.

I don't expect you all or anyone to have the same moral objections to the status quo that I do, but I do think that if you accept a notion of a moral imperative to provide health care for all, quibbling about the numbers is an exercise in bad faith.

Posted by Freddie | February 4, 2008 12:56 PM

I live in Massachusetts, and the health plan I could afford does not cover routine doctor visits. I ask my doctor for a discount for cash, and I get 10%, because the doctor doesn't need to deal with the insurance company. I'd like to see all medical insurance eliminated, but that's not going to happen. It does seem to me, however, that if we eliminate the link between doctor and insurance company, making the patient deal with insurance and pay for visits, that we could lower the cost of health care 10%.

Posted by David Pinto | February 4, 2008 1:07 PM

"OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?"-liberalrob

As Thorely argues, a good way to reduce health care costs is to address the problem of third party payment. That is a major cause of the rising prices. So we could elimnate the bias in favor of employer-provided medical care (which never made any sense). If people were choosing their own medical insurance, they would have an incentive to eschew "gold-plated" polcies in favor of catastrophic coverage. This would reduce the overuse of medical services (since people would be paying for more of their own care) and reduce costs. As the demand for a good falls, ceteris paribus, its price will fall as well.

The President proposed such a change in the 2007 State of the Union Address but as I recall it got a chilly reception from the Congress. That's too bad.

Posted by rwe | February 4, 2008 1:15 PM

If the number is one hundred million or one million or one, something has to change.

Oh, but the changes do not have to be the same. If the number is 1 (one) then by all means, just buy the hapless sod whatever policy you deem equitable and pay for it from the federal budget. I'm sure 0.003c/yr will not break anyone's bank.

If you can positively demonstrate the number is indeed 100,000,000 -- of people who have to forgo some essential health care because of the cost -- then I will be inclined to reassess my view of the universal healthcare approach.

If, however, the numbers are in the range of single millions then there may well exist a wide variety of options for improving the situation without radical changes for everyone else. Why, I'm sure I've seen some of these options mentioned on this very thread...

Posted by ...Max... | February 4, 2008 1:18 PM

The other side of the coin is that the Mass problem stems from the point that enrollment has massively exceeded expectations-- and this is in one of ovewealthiest states.

This strongly implies that people like Mixner above who claim there is no problem are even more incorrect then we realize.

Posted by spencer | February 4, 2008 1:20 PM

The other side of the coin is that the Mass problem stems from the point that enrollment has massively exceeded expectations-- and this is in one of our wealthiest states.

This strongly implies that people like Mixner above who claim there is no problem are even more incorrect then we realize.

Posted by spencer | February 4, 2008 1:21 PM

I ask my doctor for a discount for cash, and I get 10%

Another personal anecdote: when I had to go without medical (dire straits and lapsed COBRA) the pediatrician I was taking my kids to simply sliced 50% off his regular bills. Which was somewhat less than what he would normally get as "allowed amount" from the insurance company but probably on par once you take into account the billing overhead.

Posted by ...Max... | February 4, 2008 1:25 PM

But, again, if like me you find it morally indefensible for those who want health care to be unable to get it, or to be unable to do so without causing economic havoc on their lives, then the issue of how many loses a great deal of significance.

One of the problems with this claim is that health care is not a single discrete product that you are either "able to get" or "not able to get" but a vast range of products are services. There is a vast range of medical tests, pharmaceutical drugs and surgical procedures that you cannot "get" in Britain or Canada unless you are willing and able to pay for them yourself. A recent article in the Economist described the case of two British cancer patients who are suing Britain's National Health Service for failing to provide them with a drug to treat their cancer. The article mentions that around 40 expensive new cancer drugs are expected to be licensed over the next few years, but that the NHS will probably refuse to pay for any of them. If you have the money, you will be able to buy the drugs privately, but if you don't have the money, you're out of luck. Do you consider this situation "morally indefensible?"

Posted by Mixner | February 4, 2008 1:28 PM

The other side of the coin is that the Mass problem stems from the point that enrollment has massively exceeded expectations-- and this is in one of ovewealthiest states.

This strongly implies that people like Mixner above who claim there is no problem are even more incorrect then we realize.

Possibly, possibly. But it could also show that the moral hazard problem is larger than we realize, too.

I do think that if you accept a notion of a moral imperative to provide health care for all, quibbling about the numbers is an exercise in bad faith.

Well, of course it is. But if you accept a slightly different premise--that there is a moral imperative to provide health care for those who cannot (as opposed to do not) provide it for themselves, then the provenance of those numbers start to matter a bit more.

Posted by Rob Lyman | February 4, 2008 1:32 PM

spencer,

You need to stop attributing to me statements I haven't made.

The big lesson of the Massachussetts health care fiasco, especially this new finding that costs are likely to be much higher than anticipated, is that universal health care at the national level is likely to be much, much more expensive than Hillary and Obama are suggesting. That wasn't exactly a big secret even before this new development, but perhaps it will have the effect of forcing the Democratic nominee to be more honest in acknowledging the true costs of what they are proposing.

Posted by Mixner | February 4, 2008 1:36 PM

Of course, if you believe that it's profoundly immoral for people to go without health care because they can't afford it--in arguably the most economically powerful country in the history of the world-- the cost overruns are also "brilliantly irrelevant".

I do think that if you accept a notion of a moral imperative to provide health care for all, quibbling about the numbers is an exercise in bad faith.

I don't agree with either of these statements. If the costs are irrelevant, just tax at 100% and dedicate all the proceeds to providing healthcare. Pretty soon nobody will have healthcare. Costs can be relatively small or justified but no moral argument obviates cost altogether.

Posted by "Mindles H. Dreck" | February 4, 2008 1:42 PM

MM wrote: This is, of course, brilliantly irrelevant to any argument over national health care, since the Feds don't have another government to contribute to the kitty.

I saw this statement and immediately rushed to CNN to see what kind of revolution had overthrown the Chinese government, but CNN hasn't heard about it yet. Care to fill us in?

Freddie wrote: The value of the 47 million figure has proved controversial. It's not surprising that I find the evidence supporting it more convincing than the evidence against it, and it's not surprising that you who are opposed to universal health coverage find the opposite.

What you meant to say was, this figure has been roundly debunked for the purposes you intend to use it. But since 47M has more shock-and-awe value and justifies bigger and more over-reaching policy prescriptions than the 10-12M or so who are genuinely screwed under the current system, you prefer to keep spouting it and pretending that the figure is real and the objections are merely one of "controversy", rather than the result of a liar engaged in figuring.

Posted by anony-mouse | February 4, 2008 1:53 PM

liberalrob:

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

Price controls on pharmeceuticals and an end to Federally subsidized biomedical research. That will put an immediate stop to the invention of expensive new therapies.

Posted by Ralph Phelan | February 4, 2008 2:54 PM

Liberal rob asks for genius input above. here goes: You fundamental premise is wrong. We don't have a health care crisis in the US-of course, costs go up, but ALL costs go up--inflation is the norm and costs from improved medical equipment, pharmaceuticals and care are passed along. Moreover here's an assertion you will choke on: the US has the best healthcare in the world; every statistic that measures the state of health care intervention; eg, longevity and length of cure rates after medical intervention are improving. You falsely assume that health care insurance equates to healthcare. No citizen is denied health care in the US because of inability to pay--you will find that statement in every public or non-profit hospital in the country.

Posted by rja | February 4, 2008 2:54 PM

We know healthcare costs are spiralling out of control .... because the MSM are constantly pounding it into our heads.

It's not like they have an agenda or anything.

Posted by fdcol63 | February 4, 2008 2:56 PM

To what extent are health care costs distorted by lawsuits? I've heard that malpractice insurance is a considerable cost to doctors, perhaps tort reform that limits awards to damages only might lower costs?

Posted by Kevin in MN | February 4, 2008 3:03 PM

This is, of course, brilliantly irrelevant to any argument over national health care, since the Feds don't have another government to contribute to the kitty.

Not yet.

The socialist world government is Phase II.

Posted by TallDave | February 4, 2008 3:06 PM

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

Number one, end the cartelization policies that make health care so expensive. The AMA should not be allowed to artificially restrict supply the way they have. Medicine is no longer a "noble" profession at high six-figure incomes.

Number two, end the insurance schemes that insulates both doctor and patient from cost decisions (mostly the doctor). People need to pay some siginificant percentage of their medical costs.

Three, stop assuming that medical care is a "right." OK, we can feed the indigent, and maybe welfare can also cover housing, but there are limits to how much free stuff we can provide to the unproductive by seizing the wealth of the productive. If you want to afford medical care, you need to provide a useful service to society which society is willing to pay you for.

Posted by TallDave | February 4, 2008 3:13 PM

HOLY COW! Mass. increased demand and costs went up. Who'd ever guess that increased demand, without increased supply, would cause costs to rise?

I'll bet economists, worldwide, are already studying this newfound demand-cost thing.

Posted by Sparky | February 4, 2008 3:20 PM

Also, I am always reminded when I hear this debate about how some middle-class families in southern border states dealt with rising health care costs: they went to Mexico, where they could get fillings for $1/tooth and see a doctor for $10.

Posted by TallDave | February 4, 2008 3:21 PM

We can't let the free market decide and call ourselves human beings

Uh, yes we can. You don't seem to be able to grasp a very simple point. Government involvement has driven costs up.

Posted by The Ace | February 4, 2008 3:28 PM

Random Trool Here.
In Better: A Surgeon's Thoughts on Performance by Atul Gawande, the author details his views that malpractice lawsuits generally help very few people harmed by mistakes. He acknowledes that medical mistakes happen more than doctors and their lawyers make out, but the siege mentality is such that the current state of affairs only helps plantiff's attorneys and a few dramatically aggrieved plantiffs.
He suggests a New Zealand model where all people harmed by mistakes are just compensated reasonably from a fund that all doctors pay into. This is a better use of the same amount of money (or less) that now goes to malpractice insurance and layers on retainer.

Posted by anon | February 4, 2008 3:30 PM

I can think of 47 million pieces of evidence off the top of my head.

Posted by Freddie

Hilarious.

You can? You have proof that everyone without health insurance can't afford it?

Please provide that evidence. Post haste!

I do enjoy watching the left pretend that health insurance is some sort of moral obligation. I guess that's what you have to tell yourself when you believe in inherently immoral things.

By the way, you, nor anyone reading, has any evidence that those (alleged) 47 million go without medical care. Which proves the ruse, you just want socialism under any guise.

Posted by The Ace | February 4, 2008 3:32 PM

We count the unreimbursed costs of treating the 9mm lead poisoning in the inner cities as a 'healthcare cost' ... is it, or is it a failed law enforcement cost that manifests in more 'healthcare'?

We count the hidden costs of preventing and insuring against unwarrented lawsuits against all parts of the heathcare system as costs of heathcare ... are they, or are they a cost of the out of control legal system in this country as compared to all other countries in the world?

We count the costs of delivering the 'anchor babies' for illegals, for free, as healthcare costs ... are they, or are they a part of the failed policies of safeguarding our borders?

Posted by Rudy | February 4, 2008 3:34 PM

"We can't let the free market decide and call ourselves human beings."

Hmm. I suppose the first time anyone did anything other than let the free market decide was sometime in the 20th century. What do you call everyone who lived before then?

Posted by Mark | February 4, 2008 3:37 PM

He suggests a New Zealand model...

This is also the worker's compensation and no-fault auto insurance model, and it's successful in those two contexts. The fundamental tradeoff is the elimination of the need to litigate fault in exchange for reduced payments; both sides get a little something and their lawyers get nothing.

The tricky part is deciding who is harmed by "mistakes." In workers's comp, any injury at work is compensable, including, in one famous case, injuries caused a hurricane which damaged a hotel in which an employee was staying during a business trip. On the flip side, non-work injuries are outside the workers' comp system even if caused by your employer, e.g. UPS driver gets hit by UPS truck while driving a rental car on vacation.

How is such a thing possible in the medical context? Sometimes people get worse despite competent treatment; sometimes they develop unrelated maladies for no reason; sometimes mistakes hurt them. If we need a complicated apparatus to determine which injuries are compensable by this system, then we may not get the cost savings we hope for.

Maybe New Zealand has solved this problem, but it's also possible they aren't as eager for a day in court down there.

Posted by Rob Lyman | February 4, 2008 3:39 PM

I equally am unimpressed by appeals to the legal status of those who are uncovered or undercovered.

And I'm equally unimpressed with your hysterical lying and disregard for the legal status of those you want covered. (Hint: covering those who should not be getting benefits reduces the available benefits for those who should).

But carry on comrade!

Posted by The Ace | February 4, 2008 3:39 PM

I don't live in Mass., but when I posted about Boston's ban on in-store health clinics some time ago, a commenter from Boston, a pathologist, commented that it's now very difficult there to find a primary care provider (PCP):

"...you can't really find a PCP anymore - certainly not a good one (unless you're in the medical field). Former Gov Romney's health care plan mandated that everyone have insurance in the state. This meant that there was a sudden influx of people with new insurance who had to choose a PCP. As a result, PCPs quickly stopped taking new patients. And those of us that do have PCPs have trouble seeing them, due to the high number of patients."

Does this square with what others living in Massachusetts have seen?

Posted by bearing | February 4, 2008 3:40 PM

Why is it a "moral imperative" to permit 85 years olds to consume every possible medical service available, without regard to cost, to extend their lives by an additional two years?

Why is it a "moral imperative" to pay for the medical costs associates with obseity, smoking, drug abuse, etc?

Posted by DEM | February 4, 2008 3:42 PM

perhaps it will have the effect of forcing the Democratic nominee to be more honest in acknowledging the true costs of what they are proposing.

Yes, I'm sure that the media will really push hard on the Democrats to be honest... pfft, hahahaha. Couldn't keep a straight face (straight fingers?). Come on. The media will roll over like a tipped cow, and we won't hear anything about costs until after it's far too late.

Posted by KR | February 4, 2008 3:44 PM

Here's a very straight forward example of a medical equipment improvment that increases costs 4X: Medical scanning equipment goes from 16 slice to 64 slice technology. Medical result: much greater accuracy in diagnosis; Cost to consumers for increased diagnostic accuracy: radiologists time to read scan increases four times. (not counting equipment life cycle costs from R and D to replacement) Question for all: is the improvement in diagnostic accuracy worth four times the baseline cost? And the real answer is, of course, only if it's your condition that is accurately diagnosed--the value on THAT transaction is usually priceless.

Posted by RJA | February 4, 2008 3:45 PM

Rich Canadians, such as their MP/ auto-part giant heiress came to California for cancer treatment. Non-wealthy Canadian, such as my sisiter-in-law's mother was told to either pack up and go home, or be given morphine to ease over to the other side.

Story: My sister-in-law's 92 years old mother went to market on her own. Upon returning home, she fell and broke her hip. She was admitted to tax-payers paid "free" hospital care. The doctor gave her morphine to induce coma and ease her pain. Then the doctor told the family it would take at most five days of morphine to ease her over painlessly. The family took the mother home to her 96 years old husband.

Story: My colleague's uncle needed a triple by-pass in England. Wait period: 3 months. His American nephew flew over there and paid his hard-earned American dollars for his bypass with a private establishment.

How much taxes do the Canadians and the Brits pay for their "free" care?

Morals: no free lunch, no free health care

We can easily cap the spirally health cost: don't look for miracle care, e.g. stay home and plan for your funeral if you have cancer. Chemo is expensive, afterall our grand parents just stiffened their spines and slipped away courageously, not burdening us with the spiralling health cost. And, don't send your child to the emergency room if he runs a high fever. Call your neigborhood docotr to bleed a pint or so to lower the fever. It's much cheaper than going to the emergenccy room where a whole troop of specialists fuss over him.

Posted by ic | February 4, 2008 3:50 PM

"OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?"

Kill any lawyer who brings a malpractice suit that is summarily dismissed, for one. Then, kill all lawyers who make legal problems for people who don't have an MD degree but are nurses or other health professionals who treat sore throats, colds and stuff like that. Then, kill all lobbyists who get in the way of legislation that enables the above. Put caps on malpractice insurance. Don't allow people to bring more than two suits against doctors in their lifetimes. The list is endless.

The one thing that is a SUPREMELY BAD idea is to add another alphabet soup federal bureaucracy to the existing herd. They do an incredibly bad job of everything they've tried to do on a large scale thus far. Why on earth would we want to entrust to THEM something that actually matters? Why not just skip the feds and let the UN handle our health care?

Cripes, but the Left has run out of ideas.

Posted by Dan | February 4, 2008 3:53 PM

A very good friend of mine from back in the high school years, is a maxilliofacial reconstructionist, (sorry if I mispelled, I'm just a simple cop). According to him, his liability insurance is around 250k a year. Granted, he and another surgeon have their own office together, but this is just one of the many areas where they have to raise their prices, to offset their costs. Yet another major cost is the byzantine process that drug companies have to go through to get new drugs on the market. Has anyone ever seen the tables on the amount of R&D, and money it takes just to get one new drug approved by the FDA? You wanna know why the costs of medical care has gone up so high, those are two of the main reasons right there.

Posted by Brad | February 4, 2008 3:57 PM

I wonder how much we could save if we just got the health insurance companies out of the way. How much of what we pay goes to administrative overhead, company profits, and the armies of bureaucrats looking for ways to deny treatment?

Gotta put that into the soup as well...

Posted by grumpy realist | February 4, 2008 4:06 PM

"OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?"

Get gov't out of health care. The reason it is screwed up is because they are involved in every aspect of it.

Posted by roux | February 4, 2008 4:08 PM

Government housing - so bad we're paying millions to tear it all down

Government education - so bad even Hillary wouldn't send her daughter there

why does everyone think government medical care will improve the situation?

Posted by Tom | February 4, 2008 4:10 PM

I don't know which is sadder, Krugman's now constant misleading use of figures or the people who believe anything he writes. Just the other day he was bemoaning how poorly America has done in providing broadband to Americans. Of course he left out that more Americans actually _have_ broadband than any other nation on earth.

Posted by Quilly Mammoth | February 4, 2008 4:10 PM

I am a practicing physician, and I believe that the only sustainable solution is a return to a true free market. I'm tired of seeing my patients hurt by the numerous government regulations on health insurance and health care - this is the cause of the inefficiencies and cost shifting. The current problems are caused precisely by politicians and interest groups trying to guarantee health care as a "right". That is not a proper function of government.

For more details on both the source of the current problems and a viable solution, I highly recommend the following article by Zinser and Hsieh:

"Moral Health Care vs. 'Universal Health Care'"

http://www.theobjectivestandard.com/issues/2007-winter/moral-vs-universal-health-care.asp

Among other things, the authors note that the sectors of medicine which are least regulated (such as LASIK and cosmetic surgery) show the usual pattern of decreasing prices and increasing quality over time, just as with normal consumer goods subject to the laws of supply and demand.

The free market works in the other 5/6-th of the US economy, and there's every reason to believe it would work just as well in health care.

Posted by PracticingMD | February 4, 2008 4:11 PM

I wonder how much we could save if we just got the health insurance companies out of the way.

Probably a lot IF we transferred their cost-controlling function to consumers, who can shop around, self-deny care, and haggle for free. But nothing at all if we transfer it to the government, which will have to either perform the very same administrative functions (with civil service employees) or simply pay up blindly (inviting fraud and overcharging).

Those insurance companies aren't spending a dime more than they have to paying their bureaucrats; if they could fire them all with no ill effect, they'd do it.

Posted by Rob Lyman | February 4, 2008 4:12 PM

Why is it a "moral imperative" to permit 85 years olds to consume every possible medical service available, without regard to cost, to extend their lives by an additional two years? Why is it a "moral imperative" to pay for the medical costs associates with obseity, smoking, drug abuse, etc?

Because Freddie is an accredited high priest of the Order of Social Guardians and wields a +10 Sword of Flaming Moral Imperative. You have to be at least a level 30 to beat him.

Posted by anony-mouse | February 4, 2008 4:19 PM

Tom and Dan are completely right.

Forcing everyone into a government-run mandatory medical system just because some people have no health insurance would be just as wrong as forcing everyone into a government housing project just because some people are homeless.

Posted by PracticingMD | February 4, 2008 4:19 PM

"...since the Feds don't have another government to contribute to the kitty."
Hmmm. Those Euros keep saying that they want the opportunity to vote for the US President. How 'bout we let them, providing that they pay for our health care? :)

Posted by Jim,MtnViewCA,USA | February 4, 2008 4:22 PM

Freddie wrote:
Of course, if you believe that it's profoundly immoral for people to go without health care because they can't afford it--in arguably the most economically powerful country in the history of the world-- the cost overruns are also "brilliantly irrelevant".

Three questions for you, Freddie:

1) Is it fair to infer from what you've written that you do, in fact, believe it's immoral for people to go without health care?

2) Similarly, is it fair to infer from what you've written that you do, in fact, believe that this moral imperative renders concerns over costs irrelevant?

3) What percentage of your disposable income do you dedicate to paying for health care for others?

Posted by Matt | February 4, 2008 4:28 PM

Where in the constitution is the federal government given the authority to do anything about this? The fed govt should get out of the way and let each state deal with it separately.

--Greg

Posted by Greg | February 4, 2008 4:50 PM

I grew up in Canada, and had enough experience with the healthcare system there that I think I can comment usefully. First, healthcare in Canada is not all bad - there are lots of very skilled and very dedicated doctors and nurses doing their best to take care of patients. If you have a heart attack or get hit by a truck and get hauled into the ER, you will be treated and treated well. If you are generally healthy, and just need to see a GP once or twice a year (and you live in a major urban area) then the system will work well for you - it will cost too much for what you get - but you'll be ok. If you have a chronic condition, like you need a hip replacement, you will likely wait two years for the procedure and will become a morphine junkie in the meantime. Basically, if you need some kind of expensive, difficult and/or rationed care (something exotic like and MRI) you will wait in line until the condition becomes critical, at which time you may be treated before you die (or not, roll of the dice). If you present at the ER with a less-than-immediately life threatening condition, you will likely be treated on a gurney in the hallway, where you are free to contract something truly life-threatening like SARS.

When I was 16 I came down with a really bad case of Salmonella, and spent three days in Emergency, watching (and smelling) old people die because there was no room to be had in the regular wards upstairs. My Mother's appendix burst while it was being removed because her surgery kept being delayed. All this in one of the "better" hospitals in a fairly affluent suburb. Most of the leftie politicians who inflicted this on the country go to Florida, California or the Mayo Clinic for treatment, as do other wealthy folk. Some less-wealthy people go to India.

If America adopts this system, I think I'll have to move yet again.

Posted by Holdfast | February 4, 2008 4:51 PM

I like the idea of getting the market back into medical care. The government regulated insurance industry is the real problem. Encourage people to buy health insurance that covers major, unexpected costs and then let everyone buy stuff with their own money (tax deductable or not, whatever). This will drive down costs.

I know a number of doctors who refuse to deal with insurance companies because it's too much work. So I end up filing my own paperwork and then having to keep after the insurance company to make sure they pay (oops, I forgot to draw a parrot in box 12 on page 87 of form 123XXR! No money for me!).

I'd rather just pay for doctor visits but not have a big monthly premium (and get the money my employer is paying, too).

Oh, and it's nice to participate in a thread where we can be nasty to each other without a lot of angst over who started it and how nasty is too nasty. :)

Posted by Earnest Iconoclast | February 4, 2008 4:54 PM

You might think I'd become a little dejected at the frankly comical level of vitriol I entertain around here. But I have the advantage of being able to place this blog's comments section in an actual national political and social perspective, which makes me downright cheery.

When I'm called a liar, for instance, regarding the 47 million uninsured figure, it would probably be important to note that the figure is used often without controversy. Anony-mouse asserts that the figure has been "debunked", and acts as if that is a known fact, rather than a statement of dubious truth. Never mind that it is used by the national newsmedia at all levels, and by political commentators, right-wing and left, regularly. As I've conceded, in any figure of the type, there is room for disagreement about the specific nature of what that information reveals. But what is not a matter of any disagreement from anyone seriously discussing the issue is the fact that there are tens of millions of Americans who do not have access to health care because it's beyond their economic means. As I've taken care to note, no one is obligated to agree that there is anything morally questionable about that fact. But the American people believe exactly that, and they are using our political process to effect change.

Again, taken out of context of real life, it might appear that I should be discouraged. But, of course, universal health care is one of the most consistently and overwhelmingly supported policy initiatives in American life. In poll after poll after poll, Americans support universal health care, and by large margins. In poll after poll after poll. This is reflected in the policy positions of every major Democratic presidential campaign, current or recently conceded. These candidates, reflecting the will of the large majority of the American people, are in a position of unique strength this election cycle. More damningly for my opposition, the Republican Presidential primary campaign has included a great deal of discussion about the American health care crisis, and the major Republican Presidential candidates have equivocally but genuinely begun to confront the problem. At several debates, they have conceded the need for public policy initiatives which satisfy my most basic desire: that no one be denied access to health care because of economic inability to obtain it.

And, in the larger view, of course, I have the knowledge that the conservatives who attack me are part of an increasingly marginal social movement who's bankrupt ideology has been as thoroughly discredited in the last 8 years or so as one could possibly imagine. Having failed the most important test of any political ideology-- the ability to wield power-- conservatives are being banished from office. Your side, to put it bluntly, is getting it's ass kicked, and it's happening because your ideology has utterly failed to provide the American people with what they need to live their lives. As for my self-styled "libertarian" critics, what even needs to be said? You are a part of a powerless and embittered minority, one which has never wielded any significant power in this country and whose bellicose frankly cultish public demeanor ensures that is unlikely to change.

So let me reflect the growing consensus among those who follow this country's political life and it's public policy: universal health care is coming to this country. The people want it, the liberal party is actively pushing it, the conservative party is afraid to stand against it. It's coming. And all of your snark, your disdain, your jokes, your insults, and disregard for people you disagree with won't change it.

So how's that?

Posted by Freddie | February 4, 2008 5:08 PM

Freddie thinks 1/that it is immoral for people who need health care not to be able to afford it, and 2/ that quibbling about numbers is an exer cise in bad faith.High quality health care requires high quality doctors, nurses,technicians, therapists,hospitals, medicines, research,drugs,equipment,machines, and devices just to name a few.How much health care is Freddie willing to provide without quibbling over costs? Vacations in the Caribbean for those whose nerves, depressions,psychiatric needs etc desperately require them?Home nurses for Mothers whose daily routine leave them exhausted?Emergency care a 2am for a child with an uncofortable sprained ankle?If numbers are an exercise in bad faith, what is it if the government taxes me to pay for obesity surgery for those who refuse to discipline themselves or exercise.I know that we should think of Liberals not as " bad people " but just people with different opinions ,but thes kind of comments make it necessary to willingly suspend disbelief to avoid the feeling that they are either incredible stupid or deliberately attempting to bankrupt all of us into revo;ution.

Posted by john morrissey | February 4, 2008 5:08 PM

Liberalrob and others: what are you defining "healthcare" to include? It's not a binary "you have it or you don't" choice. At the ridiculous low end, no doctors, no medicine, if you're cut you use duct tape. At the ridiculous high end, each person has his own physician who follows him around with customized pharmaceuticals and a medevac heli on call. Where are you going to draw the line?
Since we can't afford to spend, say, $100,00 per person per year on this, ultimately you're going to have to draw it based on cost, and say either "if you want more, you pay for it yourself" or "if you want more, too bad".

Posted by CDeBoe | February 4, 2008 5:13 PM

But what is not a matter of any disagreement from anyone seriously discussing the issue is the fact that there are tens of millions of Americans who do not have access to health care because it's beyond their economic means.

This assertion is just utter nonsense. There is a large network of public and private health care programs and facilities that provide free or heavily subsidized health care to the indigent. The fact that you keep repeating this "tens of millions who can't get health care" nonsense demonstrates only that you yourself are unwilling to engage the issue seriously. Rather than keep mindlessly repeating claims and slogans you found at moveon.org or some similar source, why don't you try actually investigating the issue yourself, freddie?

Posted by Mixner | February 4, 2008 5:19 PM

The composition of the number, 47 million Americans uninsured, is important, as you seem to agree. Of that 47 million, how many of them are eligible to receive newly created government sponsored healthcare, are presently unable to purchase healthcare themselves while being ineligible for Medicaid? That is the number that is relevant to the discussion at hand. As others have noted, that number is less than 47 million.

Posted by Yancey Ward | February 4, 2008 5:22 PM

Oops! My comment was directed to Freddie.

Posted by Yancey Ward | February 4, 2008 5:23 PM

Freddie,

A-M (and others) pointed out that the figure was debunked for the purposes you intended, namely as a number of people who cannot afford "medical care."

47 million is (so I'm told) the number of people who do not have medical insurance. There are at least two differences between that number and the one you want: some people without insurance can get care, and some people without insurance could get it if they wanted.

For the record, 1) I don't support calling you a liar, at worst you're exaggerating a tad to make a point, and 2) I don't disagree with your general "moral imperative" argument. Your lack of specificity makes it hard to disagree; if you want the very fanciest, most-advanced treatment for indigent 90-year-old smokers, I'd have a problem with that. If you want 1985-level care for all, hey, that's fine with me; plenty cheap and frankly not at all bad. But you never get down to making those kind of fine slices, so most of us are left with no choice but to joust with strawman, being unsure where the actual Freddie is.

Oh, and if you are under the impression that W and the congressional Republicans have acted "conservative" while in office, then you need to get out more. Medicare part D, NCLB, shamnesty, cronyist Cabinet appointments, DHS--a lot of us real conservatives are just as pissed as you are. Republicans have failed badly. Conservatives haven't gotten a shot at it yet, and in all probability never will.

all of your snark, your disdain, your jokes, your insults, and disregard for people you disagree with won't change it.

No, but it will preserve our right to say "told you so" when it (inevitably) fails. You have to keep your eye on what's really important.

Posted by Rob Lyman | February 4, 2008 5:24 PM

OK geniuses, so what's your solution to arresting the upward spiral of health care costs that is putting health care increasingly out of reach for people?

1. Get real when addressing fraud. Some estimates have the cost of fraud in medical care reaching into billions of dollars a year. People on Medicaid or Medicare who shouldn't be. One case comes to mind of a woman in a wheelchair, getting free medical care via Medicare, who jumped up and ran away when the police came to arrest her for something or another.

2. Reduce administrative overhead and waste. The average US physician spends ~15% of his or her income on filing paperwork with insurance companies. Drop that in half, and you'll reduce the overall cost to the patient.

3. Malpractice lawsuit reform. One lawsuit can ruin a physician's chances to get malpractice insurance, or raise the rates of such insurance to beyond reasonable. Ex-father-in-law spent $100K in his last year of practice, because of ONE patient who brought suit on unfounded claims. She lost, he won, but the rates skyrocketed.

4. Promote healthier lifestyles and preventative care. Roughly 30% of the US population falls into the "obese" or "morbidly obese" definitions. 20% of the US smokes cigarettes. We engage in risky behavior. We drive drunk. We use illegal drugs. We have crappy dietary habits. We don't take care of ourselves, and it's expensive when it catches up to us.

Those are four ideas off the top of my head. Give me time, I'll think of more.

Posted by Jeff B | February 4, 2008 5:26 PM

Freddie--I think most people would agree that there are about 47 Million or so Americans without health insurance--but you take that figure and tell us that 10s of millions lack access to health care--they may well lack access (geographical, medically underserved areas or the like). But the point you don't appear to acknowledge is that health insurance does not correspond to access to health care. Health care is available to any person in the country without regard to their ability to pay. We can argue about the quality of that care, or that the cost of ED care is passed along--but the assertion that is 10s of million Americans lack health care is absolutely without merit.

True enough, it is a societal question whether health insurance should be provided by the government--and the political system is the appropriate mechanism for making that decision. But as long as you continue to equate health care with health insurance you will be misrepresenting the nature of the problem, and, therefore the solultion as well.

Posted by RJA | February 4, 2008 5:32 PM

Matt,

Excellent questions. Following on, must point out that Freddie's conclusion:

The government must subsidize healthcare.

Does not follow from his premise:

Universal healthcare is a moral imperative.

Why does a moral imperative = a mandatory government program? I submit it does not... you may believe that all people should have healthcare regardless of cost, but this in no way implies that the government should ignore cost and implement a universal plan.

1: It's not a moral imperative. Access to a doctor at the expense of the general public is certainly a nice idea, but failure to provide it does not make us an immoral people.

2: It is not government's responsibility. If you believe it is a moral imperative you are free to act upon that, but you are not free to force that moral judgment upon me through legislation.

3: It is unconstitutional. No reasonable reading of the Constitution reserves to the federal government the power to levy a tax on the population for the purpose of distributing subsidized health insurance to the population.

4: It does not solve the problem. As many have pointed out, there is a vast difference between universal insurance and universal care. At least under the regime in Ireland which I experienced for 4 years, national healthcare is a guarantee of long waits, substandard care, crowded facilities, poor practitioners, and astonishing cost overruns.

5: It ignores all other duties of government. If universal healthcare is worth any cost, what about all the other things government does that are similarly important? Framing the question as such ignores the balance that must be struck between this proposed duty and other existing ones. We do not have infinite resources.

Freddie, if you truly believe that prompt access to a doctor whenever you need it is an issue of morality that must not be ignored, your highest priority should be to prevent our government from getting involved. At least now you can go to an emergency room.

-spool32

Posted by spool32 | February 4, 2008 5:39 PM

I have a few random thoughts:
1. to say health has improved since my parents' day means nothing: logevity means I have needs they did not have (exaple: they did not have antibiotics)...
2. In my area we have a number of hospital directors (CEO) maiking ove a million a year.
3. If I go to the emergency room because I have no health coverage, they must take me in. they then pass on costs to those there who are insured "upstairs"--patients at the same place. Then the insurance companies say it costs too much so let us cut coverage and raise costs for insurance.
we all lose.
4. be conserative or liberal but do not call the plans put forth by Clinton or Barak socialism:
those plans are for govt insurance, the same way
that your bank account is insured by the govt or Medicare insures people..
5. Who pays for health insurance for members of Congress? how good is their plan?

Posted by fred lapides | February 4, 2008 5:43 PM

[I'm being attacked but I'm more worldly than you marginalized rabble blahblahblah]

..So let me reflect the growing consensus among those who follow this country's political life and it's public policy: universal health care is coming to this country. The people want it, the liberal party is actively pushing it, the conservative party is afraid to stand against it. It's coming. And all of your snark, your disdain, your jokes, your insults, and disregard for people you disagree with won't change it.

So how's that?

Well, it's an interesting complaint, but it's not much of an argument for govt-provided healthcare or insurance. The majority have believed in many things, including notions that 'progressives' deplore. The fact that something's coming doesn't make it good. The questions in my mind are:

1) why haven't we tried a more free market approach? Why are corporatist and government-provided the only solutions? There are nascent association-based approaches happening. Why wouldn't these make sense, and why can't they be subsidized (or not) *equally* with corporate plans?

2) if we won't try a free market approach, what will be the maximum marginal taxpayer cost for the Nth insured that would cause us to stop? This is the real crux of the question that the moral imperative language tries to wave away.

3)will govt-provided healthcare remove all personal responsibility through mandates? Is that a good thing for healthcare costs? (hint - I say no)

Personally I favor a govt provided catastrophe plan and the rest as free market as possible. Several others have suggested the same thing. I would characterize these as good faith entries in the discussion, and they ce