My world is full of disappointments. I had hopes that a post titled “Why Affordability Is Not Obamacare’s Primary Goal” might actually have dealt with the question but, alas, that was not to be. What the post is actually about is how affordability is not the PPACA’s primary goal or, at least, how you can tell. That’s mildly interesting but not as interesting as the other question.
Let me try to answer it. The reason that affordability is not the PPACA’s primary goal (or even, perhaps, a goal it had at all) is that the law would have faced bitter opposition from providers, insurance companies, and consumers if it had been.
The only way that healthcare can be made affordable is by changing how it is delivered. Full stop.
That will be thrust on us willy-nilly. Healthcare costs will not continue to rise at three times the non-healthcare rate of inflation indefinitely. I think it would be more prudent to confront that in anticipation but I seem to be practically alone in that belief.
So all of the time I am spending on cutting costs is a waste? I should stop?
Steve
Hmmmm. You’re being reasonable. Arnold Kling sometimes refers to health care as a New Commanding Height of the American economy. Thanks to improved manufacturing technology and foreign competition and so on, shoe making — as an example — is a shrinking part of the economy. We spend less money on shoes, we hire fewer people to make them and more people to sell them, etc. So US Shoe Manufacturing goes belly up, and the market provides us opportunities to spend our wealth on something else, that’s new and exciting, that gives people what they want, and incidentally provides jobs for those laid off shoe makers. And it turns out to be H*E*A*L*T*H C*A*R*E!
There is no limit to how much Health Care we all want to consume. And our consumption is Pure and Total. Nobody buys 6 months of Good Heart Functioning and stocks it away in a safe for future need. No, you use it now. Your heart’s good today, and you give the doctor a check for telling you so. Your heart’s bad the next day and you give doctor another check. Without a complaint. Isn’t that wonderful? And everybody wants it, and wants more and more and … This is even better than legalized heroin. Health Care is the ideal consumer commodity.
Except paying for health care for people who aren’t extremely rich is a bit dicy. We’re still working the bugs out of that little problem. Odds are, we’ll still be struggling 50 years from now, since too many businesses have an interest in the status quo.
Currently, the last 15 years or so, US healthcare costs have run at about 17.7% of our GNP. The trend is up, slightly — 17.9 for the last four years. What the limit is, isn’t clear, since nobody else is paying out that kind of money. Liberia and Sierra Leone and Tuvulu are closest, at about 15% of GNP. But generally, health care costs is a measure of development — typically 10% or so in European states, 5% in China, half that in South Sudan and Thailand and United Arab Emirates.
Helpful hint: If a country maintains very high health care costs for many years, it’s probably not the laws of nature which impose these costs. It’s a political choice, and not one made by the poor.
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My apologies for being so waspish tonight.