Our university is holding a panel discussion on health care reform. The panelists, as I can see it, are the President of our hospital, and an historian. I cannot attend, so here are the few questions I sent over with the hope of getting a response to.
16%-17% of American GDP is “spent” on Health Care– and this, in the “conventional” view is a problem. But, why is health care treated just the opposite from nearly every other sector of the economy? There are three points I am making. First is that expenditures do not equal costs. Second, Americans are heavily insulated from their medical expenditures. Third, “we” are a lot richer today. To illustrate, per person expenditures on iPods and iPhones have gone up in the past 10 years, however, the cost of these items being sold by Apple has not gone up during this time. If some portion of our population is not currently getting adequate health care, or if the existing portion wishes to consume more and better advanced technologies, the share of GDP on health care expenditures is going to go up, but per unit health care costs are not necessarily going to follow.
Question #1: Would this be viewed as a bad thing? Only in a single payer system would an increase in expenditures when more people get care mean anything like an increase in costs.
Point 2: Do you know what portion of health care “expenditures” come directly from the pockets of Americans? The answer is 15%. The other 85% comes from government programs, insurance coverage and other third parties – making the US just about the world “leader” in insulating its population from expenditures.
Question #2: What types of reforms would you envision that would impose more consumer discipline in this area? Or do you believe that consumers should not have to pay anything to obtain medical care? If the latter, how do you plan on providing all of this subsidized care to consumers?
Point 3: Do you know what share of the typical family budget was spent on “necessities” of food, shelter and clothing in 1900? And today? It was roughly 72% in 1900, and down to 36% today. In other words, even if America had not become richer (it has seen real per capita income increase by a factor of seven over this time) families would have over twice the amount of income to spend on “non-necessities.” However, given that incomes have increased by a factor of seven over this time period, the typical family has fourteen times more income to dedicate toward non-necessities.
Question #3: Is there a “right” amount to spend on medical care? Would you view the rise in educational expenditures and leisure expenditures as similar “problems” warranting serious overhaul? After all, given all the space in our budgets today, expenditures on these areas has increased nearly as (or more than) fast as in medical care.
General Question #1: What forms of deregulation would you favor in the medical industry? What defense can you give to a system that does not permit families to purchase health insurance from companies located in other states? What defense can you give to a system that mandates minimum coverages on insurance policies that are subject to the political influence of the medical sector (e.g. ever wonder why you often get “free’ eye glasses with your eyecare insurance?)? What defense can you give to a system that does encourages extreme specialization into surgical specialties, but that does not permit it throughout the medical system? (For example, why cannot more services be performed by trained technicians and nurse practitioners)?
General Question #2: Medicare (aid for the elderly) and Medicaid (aid for the poor) are two large programs intended to provide insurance (and hence care) to needy populations. If these were supposed to cover the truly needy, why is there a need for health reform (I have my own ideas, I want to hear yours)? Second, these programs are bankrupting state and federal governments. How would your vision of reform correct this problem – which is far more massive than the problem of x million Americans remaining uninsured (remember, insurance does not equal care), as many Medicaid patients have demonstrated.
I wish they would “lose the we.”
These people naturally think in terms of the collective instead of individuals. I think it’s none of my business what my neighbor spends on his healthcare or much of anything else.
Did you ever see this classic?
http://www.tcsdaily.com/article.aspx?id=101007A
You nailed it, Speedmaster.
Wintercow, I’m not sure there is a crisis. I think the political class believes they hold the aces and want to win the game this time. The question is whether they take all of the chips.
I’m one of the potentially uninsured, if I had not paid several hundred thousand dollars of my money for insurance over the years for insurance, voluntarily. Two questions: should a bureaucrat have determined whether I did that wisely, and should he also force a healthy 25-year old to fork over $3500 a year?
If I were one of your students, I’d be mad as hell.
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