There’s an old joke which you may have heard before. I may even have mentioned it from this blog. Stop me if you’ve heard this one before. A man drives up to the general store somewhere in rural Maine. He asks the elderly Down Easter sitting on the front porch of the store how to get to town X. After thinking the subject over for a few moments and entering into a few false starts in giving the desired directions, the venerable Mainster tells the puzzled tourist: “You cahn’t get the-ah from he-ah.” You can tell how old that joke is because there aren’t many general stores anymore, we have cell phones and GPS, and what with TV, radio, and the general invasion of outsiders into Maine it’s getting harder and harder to find anybody who talks that way anymore.
To me our health care system is a lot like that story.
We’ve made a lot of very poor choices over the years that make it very hard to improve let alone perfect. The poor choices include lifestyle choices, poor choices by voters and government, and poor choices by industries. Early choices—around the turn of the 20th century—include making doctors of medicine the gatekeepers of the pharmaceutical industry. The decision to become a nation of smokers was made between the world wars and even though the trend has been reversed we’re still paying the price for that one.
Deciding to adopt a system of socialized medicine (which is what Medicare and Medicaid are) without being willing to control costs, figure out how we were going to pay for it in the long term, or restrict eligibility for Medicare to those who were really in need was probably the worst decision of all. Physicians’ salaries and hospital revenues skyrocketed in the period between the adoption of Medicare/Medicaid in the mid-60’s and the start of real oversight of the programs in the late 1970’s. Among the worst effects of this in turn was to give doctors and hospitals unrealistic expectations of what constituted sustainable levels of revenue increase.
The increase in hospitals’ and doctors’ revenues made them targets for malpractice suits. Opportunistic lawyers exploited the fallability of doctors, the reluctance of insurance companies to litigate, and the misery of sick people to pursue malpractice suits beyond their legitimate merits and to pursue settlements beyond the legitimate costs. Doctors, understandably in my view, have been reluctant to weed out bad doctors, raising the malpractice insurance costs for everybody. There were other bad choices.
Lots of bad choices.
So here’s what needs help in our health care system:
- We have the most expensive health care system in the world.
- We’re not getting the best results in the world from it. Pretty nearly the only statistic in which we lead the world in health care terms is physician salaries.
- Our employer-based system renders American companies less competitive in a world market in which most of our competitors have nationalized health care. And it’s self-destructing anyway since a decreasing proportion of employers offer employee health plans and employee contributions are rising sharply.
- Our system is unfair. Substantial areas and sectors of the population are underserved.
- Our system is immoral. The high compensation rates here are drawing resources from all over the world that are desperately needed in their home countries.
- Our system is unsustainable. As the Baby Boomers reach Medicare age there’s just no way to meet the obligation without either enormously higher taxes or huge borrowing. And just as in your own budget borrowing to meet current expenses is always a bad idea.
Medicare and Medicaid aren’t going to go away. Short of a Wayback Machine, there’s no way to get rid of them. And means testing does not appear to be a politically possible solution.
I used to believe in a pure market-based solution. But the enormity of such a solution makes it impractical. The list of things we just aren’t going to do but are necessary for a real market in health care include: abandoning licensing of practitioners, making all pharmaceuticals available without prescription over the counter, publishing of all prices in understandable terms, and allowing people who can’t afford health care to die when their deaths could easily have been avoided.
And even with those most draconian measures it still won’t be a market system. You just can’t be a rational optimizer when you’re being wheeled in unconscious on a gurney.
So I’m reluctantly for a single-payer system, limitations on medical malpractice judgment sizes, and closer oversight of medical doctors (including a national registry) to remove bad practitioners from the system.
Those measures may just be the start. Medical costs can’t keep going up at the rate they are now indefinitely.
