Ends and means in healthcare reform

In his Los Angeles Times opinion piece on the U. S. healthcare system Ezra Klein conflates three different objectives in healthcare reform: universality, cost, and outcomes. I write “conflates” because, while Ezra’s article is putatively about achieving universal coverage, he includes the high cost of healthcare in the United States and the poor outcomes compared with other developed nations in his arguments for “going universal”.

I don’t believe that any of the plans he mentions (the Massachusetts plan, the Wyden plan, and the Kaiser Permanente plan for California) would achieve all of those objectives simultaneously.

As most people understand it “universal coverage” means that everybody has access to some basic level of healthcare. While I agree that going to a “single payer” system (under which the government is the sole insurer) would achieve a quick-fix short-term solution to the universal access and cost problems simultaneously by cutting insurance companies out (that’s not a foregone conclusion), I’m not as confident as some are that it’s the solution to all our healthcare system problems. I think, contrariwise, that without serious reforms to both the supply and demand side of the healthcare equation, even if a single-payer system were adopted the costs would soon rise to pre-reform levels—it isn’t just the added insurance administrative costs that are rising.

Would universal access alone improve outcomes in morbidity and mortality to the level of European countries with substantially more homogeneous populations than the United States like Sweden, France, or Switzerland? Frankly, I doubt it.

There are some things that I agree with in Ezra’s article. His characterization of our present system as one that has grown like Topsy is all too true. And I agreeas well that reform is gaining political steam and as more and more people pay for an increasing proportion of their healthcare major reform is inevitable. What concerns me is that statements like this:

The details of the plan are unimportant; it’s the constructiveness of the proposal that matters.

will gain increasing sway. It’s neither the constructiveness of the proposal nor the benignity of the motivations of the proposers that are important, it’s the effectiveness of the plan.

This is my gripe, too, with those who turn pale whenever plans for reforming our healthcare are discusses, screaming “Socialized medicine!” The market-oriented proposals that I generally hear from them are predicated entirely on the notion of excess demand.

I wish that more attention were being paid by everybody to praxaeology—the science of the relationship between ends and means. Praxaeology includes economics but isn’t limited to it. Besides considering factors of supply and demand it also considers what will actually happen as the result of an implementation of a plan and other motivators, e.g. rent-seeking, taxation avoidance, and avoidance of regulation.

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