Friday, August 14, 2009

On The Rationing Of Health Care

Megan McArdle writes in The Atlantic:

"Statements that would strike almost anyone as stupid in the context of any other good suddenly become dazzling insights when they're applied to hip replacements and otitis media."

Too bad that soon afterwards she goes on to prove her own point. How? She tries to apply the distinction between price rationing and government rationing to the current debate on health care.

Says McArdle:

If you design a formula to deny granny a pacemaker, knowing that this is the intent of the formula, then you've killed granny just as surely as if you'd ordered the doctor to do it directly. That's the intuition behind the conservative resistance to switching from price rationing to fiat rationing. Using the government's coercive power to decide the price of something, or who ought to get it, is qualitatively different from the same outcome arising out of voluntary actions in the marketplace . (Emphasis added.)

I confess I am baffled. The argument for "price rationining" as I understand it goes like this: "There is not so much gasoline in the world as there was 50 years ago, so its price has increased and people will buy less of it or choose other means of transportation." Conversely, the argument for "government rationing" would be "there is not so much gasoline in the world as there was 50 years ago, so the government decides how much each driver gets, regardless of his or her economic ability to purchase more."

If I am right in my premise, then I really don't understand how the two kinds of rationing apply to health care, other than to say that it's better, in McArdle's opinion, to let the market decide that those who can afford more health care can get it, and those who cannot... well, tough luck for them. Talk about "death panels" and "formulas to deny granny a pacemaker."

McArdle's op-ed implies that the mess we're in, health care-wise, is okay because it stems from "voluntary actions in the marketplace." There is nothing voluntary in the relationship between insurer and insured, but people like McArdle pretend not to know, and conveniently treat health insurance like the commodity it is not (or should not be.)

There is nothing voluntary about buying the cheapest health insurance policy because it's the only one you can afford for you and/or your family, at several hundreds of dollars a month, for the privilege of paying 20% out of pocket until you reach 5, 7.5, or 10 thousand dollars, only to find out, when you have exhausted your deductible, that your health insurance company is dropping you instead of paying for your breast cancer treatment because you failed to disclose a pre-existing condition that you didn't even know you had.

And not all health insurance outrage stories are about cancer patients who are denied coverage and die (or not, only if they are lucky). Some are not quite so dramatic, and yet they are no less appalling.

Consider the story of this couple, who ended up paying $22,000 for having their baby, IN SPITE OF HAVING HEALTH INSURANCE (for which they pay $680 a month). Then consider that it is cheaper to have an abortion than to have a baby. Finally, hit your conservative representative or your evangelical leader in the genitals the next time they talk to you about the sanctity of life after defeating health care reform.

There are also those who maintain that there are plenty of people who make $50k a year or more and decide to forgo buying health insurance because they don't want to. Aside from the fact that the people who make these kinds of statements always accidentally fail to back them up with actual figures, I know that even making $50k a year, and after paying the mortgage (for a small apartment, not for a McMansion), HOA dues, car expenses, food and other basic necessities of life, utilities, and taxes (which can buy two wars, but no health services for me until I turn 65, if and when), I would not be able to afford buying insurance, particularly with the high deductible it would most likely carry. Besides, I could not live with the rage of finding out that after paying for years I would be denied the services I thought I was paying for. Luckily, I now have decent coverage through my employer, until I find out otherwise.

Elsewhere on her blog, McArdle states that her objection "is primarily [...] that the government will destroy innovation. It will do this by deciding what constitutes an acceptable standard of care, and refusing to fund treatment above that. It will also start controlling prices."

This is an even more irrational argument to make. First of all, it posits that the government's entry in the health care market would eliminate private health insurance, which is an unbelievable thing to say since it has not happened in any of the countries that have socialized or single-payer health care. Secondly, if the government did decide "what constitutes an acceptable standard of care, and [refused] to fund treatment above that", that would provide the perfect opening for private insurance to fill the gaps left by the government system. At which point, those who could afford "deluxe" care could choose to buy it, but everyone else would at least be guaranteed a basic level of health care that escapes too many in the current situation.

Robert Reich, who is much brighter than any of these donkeys, gives an indirect response to McArdle's article when he states, in his latest blog entry:
Health care is already rationed, of course. Those who can't afford health insurance don't get much of it, except in emergency rooms. For those who have insurance, the rationing is done by prepaid medical groups, the legacies of HMOs, that decide what drugs and procedures their members will get. Or it's done by insurance company personnel who decide what will be covered.

But for the scaremongers to say that under the healthcare reform proposals now being considered, government will do the rationing -- and that government bureaucrats will decide whether people live or die -- is odious. It's a deliberate lie that preys upon the fears of many people who already scared as hell about loss of their jobs, healthcare, homes, and savings.

We are being prodded into opposing health reform as opponents of reform feed us images of Russians lining up for bread, grandparents being left to die, and nazis marching in lockstep. Either they think we are really stupid, or they have no better arguments to defeat progress. Or perhaps, a little bit of both.

If nothing else, the last few days, and the kind of rhetoric expressed by the likes of McArdle, have shown us that there is no match for the dishonesty of the conservative shills that pollute the air with lies, except for the stupidity of the large part of the American public that believes them. How large it is exactly we are about to find out.

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