Thursday, March 25, 2010

Health Care

I have not weighed in much on the health care debate, though I have followed it closely. I consider some important aspects neglected by most people in the debate, and haven’t really known where to fit them in.

It’s good to have someone to set you back a bit, reminding you to go at first questions, rather than the ephemeral political debate. Loyal Achates, who can be found here, had the following comment on one of the posts about health insurance reform over at neo’s
Loyal Achates Says:
You know what? I’m one of the evil young people you’ve been talking about, and a leftist, and a supporter of health care reform. I do think it didn’t go far enough in extending universal coverage but I am willing to accept it as a step forward.
You know what else? I was born with a pre-existing condition - specifically, Tetralogy of Fallot. no insurance company in America will cover me, and my cardiologist tells me I’m going to need regular surgeries just to stay alive.
Would I be ‘free’ in a country where I was simply left to die because I couldn’t, at the age of 24, scrape together the $100,000 needed for the operation and subsequent hospital stay? You tell me.
It’s a very fair question. Even with the disclaimers that people can pretend anything on the internet and leave out important information, it remains true that there are people in situations much like this in our country. In fact, everywhere in the world. (And besides, I tend to think LA is truthful on this anyway.)

Here’s my worry: Loyal Achates isn’t so much unusual as he is a canary in the mine. Health care costs are rising, not because of inefficiency or heartless business practices or stunning malpractice claims – though these all deserve significant attention – but because the products and services provided simply are very expensive. And they are going to get more expensive - much, much more expensive – for the foreseeable future. We can do magical things we were never able to do. We can keep people alive (such as a family friend with CF) far longer than we could. We can save people who simply died not very long ago. And it costs a fortune.

A little background on the American way of dealing with this. I was going to call this an interpolated palimpsest, but that's not quite accurate, and just pretend. (An example of the use of of interpolated palimpsest in context, from one of my favorite books. Scroll down to Test Paper I.)

The real division occurs because this post is too long, and I wanted to create a break somewhere. Here is good. Go get coffee or something.

The old method, still the norm in poor countries, is that you purchase the medical care, get some person or persons to purchase it for you, or you go without, with full consequences: blindness, incapacity, death. Who was expected to help you with this varied from place to place, but it was a much more restricted group than now. Your immediate family might be expected to impoverish themselves if necessary. Extended family, church, or neighborhood might have some expected moral (though not legal) obligation, which they might fulfill with contributions, organizing benefits, or providing care. The larger community had little expected responsibility. This was only a century ago. All those children’s books, plays, and movies about little Elizabeth who needed “an operation,” or “a specialist in New York,” and was languishing in misery as the family strained to be able to afford such a thing, was not so long ago.

The somewhat new method is that we spread the cost out over a large number of people, either through private health insurance or government provision. As rare conditions are by definition rare, it was thought to be fairer to be a society where everyone chips in to provide for the few who were in dire situations through no observable fault of their own.

Somewhere between these two methods was the foundation of hospitals, often by religious groups, which provided some free or reduced-fee care. Hospitals tend to be part of large health-care industry groups or attached to colleges (themselves often religiously founded) now, but we can still detect that solution through their names: Beth Israel, St. Mary’s, Baptist Hospital. No one was legally required to be generous, but it was a social expectation that all would be as generous as they could. Americans, especially religious Americans, considered it part of their self-definition to be open-handed.

For many reasons, some good, some bad, this has gradually shaded into government provision of many helps that were once voluntary charity. The lines are not sharp here. American colonial communities recognised some obligation to the poor in their midst, and towns, not churches even when the two were virtually interchangeable, would vote public funds for poor farms, doctors, hospitals. Through long eras when the great majority of citizens belonged to a formal religious group with might provide a conduit for giving, they allocated some of their giving via taxation, insisting on the generosity rather than leaving it to generous feeling. But in the end, it was the same amount of money for the community as a whole.

Did the Catholic voters fear the Methodist churchgoers wouldn’t pony up? I jest. The idea has grown in America that the government is the primary expression of the community’s values. This sense has increased rapidly as people stopped going to church, which is why secularists are far more likely to regard government help as the defining item in whether a community is generous or not. Those who regard the government as an impersonal hired entity don’t see it that way.

Despite the political rhetoric, most Americans have some of both values operating, and we are fighting over How much is enough/how much is too much? We have always had a mixed socialist/free market system. Until comparatively recently, almost no Americans thought that the common weal - in our current narrow sense of equalisation - was the dominant reason for government. But neither has "rugged individualism" been so central as we imagine. The frontier peoples banded together as soon as they could. The phrase does not seem to occur until the early 20th C. The conflict of values also brings in other, messier questions: If the government expresses the will of the people in charity, isn’t it just as fair that it express the will of the people in definition of marriage or beginning of life? An interesting philosophical question – and part of why we have a Constitution.

End of Interpolated Palimpsest. Back to our regularly-scheduled programming.

So the newest method, much present in America but more pronounced in other industrialised nations, is that the cost of everything is spread out over everyone. In theory, anyway. To the government-as-expression people, this seems the only fair way. There are half-a-dozen enormous questions in the health care debate, including what “everything” is and who “everyone” is; who is allowed to make money and how much; does gifting improve the general morals and/or does it promote the deterioration of responsibility.

But all these questions are going to be swamped under the practical consideration that will force re-examination. Health care costs are rising, and will rise no matter what we do or who is in charge. We can be efficient, preventative, empirically-driven, and wise to slow this, but we will not prevent it. We are moving into a time when every family has a Loyal Achates at some point, and then into a time when a majority of us come up against the need for a medical treatment beyond the means of any but the wealthiest to afford. Whether we’re paying for that out-of-pocket or just tossing in a co-pay while we all share the burden, as medical care improves, half of the citizenry (er, residents) will require something that costs two years’ salary to effect. The cost will not go away just because people deserve the care.

I very much hope to be wrong on this. Perhaps some truly magical medical advances will turn out to be cheap. Perhaps we will culturally decide that most of us don’t want to live beyond 100 anyway, and palliative care become the norm beyond 80. But more likely, a lot of us are going to want to live to 120 if we can, and if an expensive procedure is needed at 75 we will insist it be performed. And then get a few others at 90 and 110.

If you want to see a hockey-stick graph that’s real, don’t go to environmental sites, go to the health-cost info. It’s not just machinery and medicines, but skilled people putting in time. Obama’s opponents have complained “where is the money going to come from?” It’s a fair question, but it is going to come anyway, Obamacare or no. Unless our robot doctors and nurses become really good, really fast.


karrde said...

I have always wondered what part of the increase in cost is attributable to innovation/man-hours, what part is attributable to the fact that most of it is covered by insurance provided by an employer, and what part is attributable to laws/regulations/process-paperwork/forms/lawyers.

My mother, who was a nurse until the late-80's, tells me of extra administration costs brought in by Medicare's insistence that patients not "stay too long".

A table was written up by functionaries in the Federal agency that oversaw Medicare. That table held expected hospital stays for various illnesses.

Functionaries were hired at hospitals to track the length of stay for every patient. Nurses had another piece of paperwork to fill out, and medicinal processes had to be bent to find a way to move the hardest-to-care-for out on time...or find another malady that would make further stay possible for them.

All of this process raised costs for the hospital. The costs weren't met directly by more money from insurance or medicare, so the hospital's billing staff found a way to distribute the increased cost among fees charged for every service.

In general, I think it is things like these that are partly responsible for the rising cost of health care. One more rule set down by a legislator or bureaucrat, one more piece of data that the hospitals and doctors have to submit to get a hope of receiving full payment...

And did you know that neither Medicare nor Medicaid reimburse doctors in full? They pay pro-rated levels for care...thus any doctor who accepts such patients needs a critical mass of non-Medicare and non-Medicaid patients, in order to cover costs for everyone...

I don't know if there's a way to move the payment closer to the patient, or a way to have a cost-structure that is more visible to the patient and less troubled by medical "coding procedure" and the hassles of insurance adjusters...but I think any attempt in that direction would be better than another bureaucracy, or more laws and regulations.

As you say, modern medicine is moving in the realm of diminishing-returns-per-dollar.

But that isn't the only factor in health costs, and if we can control the other factors, then fixing a society-wide problem of health care costs should be more manageable.

Anonymous said...

I've never thought that society owed me $1 million worth of health care. If the time comes that I'm diagnosed with something horrible, with horrible attending treatment costs, I'm just going to hang it up.

bap said...

Technology undoubtedly adds to the cost of HC, but from the sheer number of people involved, I'm guessing that using insurance to cover normal costs contributes more. Usually we (including the people behind the desk) have no idea how much something will cost until long after the visit is done and even then, we don't see the whole picture.

Few of the forces that increase efficiency are at work in the realm of everyday HC. Even the cost of our insurance is amorphous for most. The information loop includes caregivers, employers, insurance companies and increasingly (as karrde points out) the government--the patient is mostly an afterthought.

Regarding your discussion of spreading costs: as established, this country was meant to have a carefully limited federal govt. Depending on the state, many things are permitted at the state and local level that were definitely not included in the powers delegated to the feds. Our founders did everything in their power to make it clear that such things are NOT within the federal mandate.

Thus, it has always irritated me when Mitt Romney is dinged for establishing a HC program in MA, as though it was an offense to Conservative principles. Under a federalist system, those kinds of initiatives are MEANT to be tried at the state and local level. MA's program may be crappy, but at least he had the right to try it.

Assistant Village Idiot said...

bap, that is a very useful addition, and a friend was reminding me of this just last night. If car insurance was expected to pay for our oil changes, new tires, inspections and general repairs, it would cost a great deal more.

And we would bring our cars to the mechanic for any little thing.

Anna said...

I was actually wresting with that same thing, about uninsurable people with bad diseases. But then in the course of my research I hit upon what I believe to be the truth of the matter, that such people would fare no better under a government system, only now it would be the government saying they "aren't worth it".

I remember a while back there was a video going around the interwebs, of a young mom dying of cancer, and everyone was like "its so great you have to watch it". I watched it and it was meh, but what stuck in my brain was this: the mom was Canadian, and she spoke of the government "approving" her for treatment because of her age and other factors. I was like wow, and it did not even phase her.

So I believe that sick uninsurable people like Lord Achates would get denied coverage by the government just as they would a private insurance company. Because there is no such thing as "enough" money for everyone to get all the medical care they could ever want or need, and no level of taxation will ever make it so.

Anonymous said...

I am confused. If this person was born with a medical problem and his parents had health insurance when he was born, then he had coverage at birth because insurance companies cannot deny coverage to the sick babies of the covered person (if that person has a family plan and enrolls the baby within 30 days, etc.).

Once this guy is no longer eligible for his parents' plan, he can convert to an individual plan. Yes, the premiums might be high because of his condition, but insurance should be available.

Also, most group insurance plans offered by an employer exclude pre-existing conditions but usually only for the first year of coverage. (That's how it was when I was in the industry - things might have changed.) But that provision is there because otherwise, you could never recruit someone with diabetes or whatever. He would stay at his old company because that's the only way to keep the coverage. But if you just exclude the condition for the first year, you can cover those costs in a signing bonus.

So I don't really understand this guy's problem.

Assistant Village Idiot said...

Class, I also wondered if there were pieces missing, but as I wrote, there are real people in similar situations.

When you "don't meet federal guidelines" for a kidney transplant because you are too old, how is that not a Death Panel? In a sense, we have them already; now the government wants in on those decisions. Just because there's not a sign on an HHS door that says "Death Panel meetings, 2nd and 4th Tuesday of every month" doesn't mean it's not real.

Anonymous said...

AVI, I don't disagree at all that the government would ration care. I worked for a health insurance company for five years. If you are not going to address tort reform, if you can't get people to change their habits (to the extent that changing their habit reduces their medical costs, which sometimes it does but nobody has the guts to turn away the mother with the baby with diaper rash from the ER and you can't make a diabetic stay away from sugar if he doesn't want to), if you are not going to stop treating illegal aliens, then the only way to reduce costs is to cut treatment.

And no, I do not want the government making those decisions for me.

Anonymous said...

"Loyal Achates"

Yet another false dichotomy. We have to insure everyone for everything because a relatively few suffer greatly from chance. Okay. I'll take National Health for $1: but only 1 drug abuse treatment per life; only 1 sexually transmitted disease; only 1....

If only people would have Loyal Achates's attitude towards crime: one felony and you're locked up forever.

Micha Elyi said...

"Few of the forces that increase efficiency are at work in the realm of everyday HC. Even the cost of our insurance is amorphous for most. ...the patient is mostly an afterthought."-bap 7:10 AM

Here's a challenge: call a local hospital, tell them that you're shopping around and you want to know the total cash-patient charges for non-emergency surgery to correct a direct inguinal hernia in a 45-year old man. Chances are that nobody knows. What else besides medical treatment do individuals buy in such a piecemeal, open ended, write-a-blank-check way?