Universal care cheaper and better than private insurance. - Page 6

**Shek** · 04-20-2008, 15:06 PM

JAD,
Thanks for the reference. This is a busier week, so I probably won't get around to fully checking it out until later.

FRONTLINE:sick around the world | PBS

**Shek** · 04-20-2008, 15:26 PM

I found this interesting tidbit about big bad pharma on the interview page:

Quote:

FRONTLINE: sick around the world: analysis: the cost of drugs issue | PBS

A lot of Americans say, well, the drug companies are making obscene profits. What factor is that in American cost structure?

Reinhardt: ... If you look at total drug company profits in a given year, of every retail dollar sale, drug companies who manufacture the stuff get 75 cents. And of that, they make 16, 15 percent profit. So if you multiply that out, we have about $220 billion in drug sales; that's about, say, $25 billion in profits. Now, that is a lot; you can buy two Princetons for that. However, if you then divide $25 billion through $2.2 trillion in national health spending, you get 1.2 percent; that is, drug company profits are 1.2 percent of total national health spending.

So even if they made no profit, we'd only cut 1 percent of --

Reinhardt: Cut 1 percent. So again, that's the wrong target to shoot at. What you really should ask is, for all this money we're spending, are we getting the maximum value in the drugs? And by and large, the economists who have looked at it would say yes, we actually do.

Tarek Morgen · 04-20-2008, 17:00 PM

Then I am wondering why medicin is so exepensive in your country.

lwarmonger · 04-20-2008, 17:16 PM

Just thought I'd weigh in.

I'd consider myself first in line to be in favor of the free market, but the numbers don't lie. We pay two to three times as much for a far inferior result compared to other industrialized nations. Even taking into account the inferior health of much of our population (one of the unfortunate effects of a suburban commuter society I'm afraid) that is still unacceptable.

We need to start a program that can cut costs and improve preventative coverage, and I must admit that the style of programs that JAD has been describing sounds pretty attractive.

Gun Grape · 04-20-2008, 20:38 PM

Quote:

Originally Posted by Southie

When I retired from the AF in 2000, I immediately applied for VA benefits. Specifically for fibromyalgia, psoriasis and eyesight. I was denied any benefits for my eyesight, but received a 20% disability for the other two. All I did was make a copy of my medical record, and submitted it with my claim. Within a month I received my letter informing me of my disability rating.

And that is the biggest complaint about the VA rating system. The level of inconsistency. That anyone would want to use it as a shining example of how to do health care in the US amazes me. Especially when that one survey that rates it as such is a end user satisfaction survey, not how well they actually do business. And we know how well they do by the number of lawsuits that are being attempted to be brought forward.

Notice the person that was interviewed that said that the care wasn't as bad as she expected. After having to wait 8 months for a teeth cleaning. I think that survey didn't take the lower expectation that those in the system had. What would you have said if you had to wait the same amount of time?

There is one other thing that the VA has that other hospital/care systems don't enjoy. They cannot be sued unless congress approves. You can appeal through an administrative process but there is no punitive process. I'm sure that cuts their cost a little. There are lawsuits being brought forth, to get the right to sue.

**Shek** · 04-20-2008, 20:50 PM

I've pulled a bunch of articles down.

http://www.nytimes.com/2007/11/04/bu...ss&oref=slogin

Quote:

November 4, 2007
Beyond Those Health Care Numbers
By N. GREGORY MANKIW

WITH the health care system at the center of the political debate, a lot of scary claims are being thrown around. The dangerous ones are not those that are false; watchdogs in the news media are quick to debunk them. Rather, the dangerous ones are those that are true but don’t mean what people think they mean.

Here are three of the true but misleading statements about health care that politicians and pundits love to use to frighten the public:

STATEMENT 1 The United States has lower life expectancy and higher infant mortality than Canada, which has national health insurance.

The differences between the neighbors are indeed significant. Life expectancy at birth is 2.6 years greater for Canadian men than for American men, and 2.3 years greater for Canadian women than American women. Infant mortality in the United States is 6.8 per 1,000 live births, versus 5.3 in Canada.

These facts are often taken as evidence for the inadequacy of the American health system. But a recent study by June and Dave O’Neill, economists at Baruch College, from which these numbers come, shows that the difference in health outcomes has more to do with broader social forces.

For example, Americans are more likely than Canadians to die by accident or by homicide. For men in their 20s, mortality rates are more than 50 percent higher in the United States than in Canada, but the O’Neills show that accidents and homicides account for most of that gap. Maybe these differences have lessons for traffic laws and gun control, but they teach us nothing about our system of health care.

Americans are also more likely to be obese, leading to heart disease and other medical problems. Among Americans, 31 percent of men and 33 percent of women have a body mass index of at least 30, a definition of obesity, versus 17 percent of men and 19 percent of women in Canada. Japan, which has the longest life expectancy among major nations, has obesity rates of about 3 percent.

The causes of American obesity are not fully understood, but they involve lifestyle choices we make every day, as well as our system of food delivery. Research by the Harvard economists David Cutler, Ed Glaeser and Jesse Shapiro concludes that America’s growing obesity problem is largely attributable to our economy’s ability to supply high-calorie foods cheaply. Lower prices increase food consumption, sometimes beyond the point of optimal health.

Infant mortality rates also reflect broader social trends, including the prevalence of infants with low birth weight. The health system in the United States gives low birth-weight babies slightly better survival chances than does Canada’s, but the more pronounced difference is the frequency of these cases. In the United States, 7.5 percent of babies are born weighing less than 2,500 grams (about 5.5 pounds), compared with 5.7 percent in Canada. In both nations, these infants have more than 10 times the mortality rate of larger babies. Low birth weights are in turn correlated with teenage motherhood. (One theory is that a teenage mother is still growing and thus competing with the fetus for nutrients.) The rate of teenage motherhood, according to the O’Neill study, is almost three times higher in the United States than it is in Canada.

Whatever its merits, a Canadian-style system of national health insurance is unlikely to change the sexual mores of American youth

The bottom line is that many statistics on health outcomes say little about our system of health care.

STATEMENT 2 Some 47 million Americans do not have health insurance.

This number from the Census Bureau is often cited as evidence that the health system is failing for many American families. Yet by masking tremendous heterogeneity in personal circumstances, the figure exaggerates the magnitude of the problem.

To start with, the 47 million includes about 10 million residents who are not American citizens. Many are illegal immigrants. Even if we had national health insurance, they would probably not be covered.

The number also fails to take full account of Medicaid, the government’s health program for the poor. For instance, it counts millions of the poor who are eligible for Medicaid but have not yet applied. These individuals, who are healthier, on average, than those who are enrolled, could always apply if they ever needed significant medical care. They are uninsured in name only.

The 47 million also includes many who could buy insurance but haven’t. The Census Bureau reports that 18 million of the uninsured have annual household income of more than $50,000, which puts them in the top half of the income distribution. About a quarter of the uninsured have been offered employer-provided insurance but declined coverage.

Of course, millions of Americans have trouble getting health insurance. But they number far less than 47 million, and they make up only a few percent of the population of 300 million.

Any reform should carefully focus on this group to avoid disrupting the vast majority for whom the system is working. We do not nationalize an industry simply because a small percentage of the work force is unemployed. Similarly, we should be wary of sweeping reforms of our health system if they are motivated by the fact that a small percentage of the population is uninsured.

STATEMENT 3 Health costs are eating up an ever increasing share of American incomes.

In 1950, about 5 percent of United States national income was spent on health care, including both private and public health spending. Today the share is about 16 percent. Many pundits regard the increasing cost as evidence that the system is too expensive.

But increasing expenditures could just as well be a symptom of success. The reason that we spend more than our grandparents did is not waste, fraud and abuse, but advances in medical technology and growth in incomes. Science has consistently found new ways to extend and improve our lives. Wonderful as they are, they do not come cheap.

Fortunately, our incomes are growing, and it makes sense to spend this growing prosperity on better health. The rationality of this phenomenon is stressed in a recent article by the economists Charles I. Jones of the University of California, Berkeley, and Robert E. Hall of Stanford. They ask, “As we grow older and richer, which is more valuable: a third car, yet another television, more clothing — or an extra year of life?”

Mr. Hall and Mr. Jones forecast that the share of income devoted to health care will top 30 percent by 2050. But in their model, this is not a problem: It is the modern form of progress.

Even if the rise in health care spending turns out to be less than they forecast, it is important to get reform right. Our health care system is not perfect, but it has been a major source of advances in our standard of living, and it will be a large share of the economy we bequeath to our children.

As we look at reform plans, we should be careful not to be fooled by statistics into thinking that the problems we face are worse than they really are.

N. Gregory Mankiw is a professor of economics at Harvard. He was an adviser to President Bush and is advising Mitt Romney, the former governor of Massachusetts, in the campaign for the Republican presidential nomination.

**Shek** · 04-20-2008, 20:51 PM

Marginal Revolution: Is American health care more productive?

Quote:

Is American health care more productive?

Advocates of national health insurance point out that the U.S. spends more on health care, per capita, than any other country in the world. At the same time, Americans rank only in the middle when it comes to actual health and longevity. So you might believe that we could nationalize the industry, save money, and improve our health. Think again:

Quote:

The proper way to measure the performance of health care is to measure the difference it makes in the quality of life of people who come for help...What we need to know is whether the higher level of spending means the United States is much less productive in health care than other countries.

In an attempt to test the limits of knowledge here, we studied the treatment of four diseases -- diabetes, cholelithiasis (gallstones), breast cancer, and lung cancer -- in three countries: Germany, the United Kingdom, and the United States. These three countries were the only countries for which comparable data existed for these diseases, either nationwide or for large regions.

The relevant measures were either life expectancy after treatment or measures of the quality of life. And how about the results:

Quote:

The United States is more productive in all these diseases except for diabetes in the United Kingdom. [emphasis added] The reasons for this result can be traced directly to the huge differences in the way the health care sector is organized and governed across these three countries. The UK health care system is almost entirely government owned and run...The result has been that the United Kingdom has no invested as quickly in technologies that have dramatically improved the diagnostic capabilities of medicine and significantly reduced recovery time...Germany, on the other hand, has a system more like the United States had twenty years ago. In Germany, medical expenses are paid for on a task-by-task basis for services of doctors and hospitals. As a result, hospitals in Germany have no financial incentive to reduce length of stay.

In other words, Americans pay more but get better health care in return. We die sooner because we eat too much and exercise too little, among other facts. For similar results, see this comparison of the U.S. and Japan.

The quotations are from William Lewis's interesting The Power of Productivity, see p.97. Lewis is a partner at McKinsey, an economics and management consulting firm. Here are other McKinsey writings on health care ($$), including the comparison with the UK and Germany.

By the way, this essay suggests that most of the productivity benefits of health care spring from pharmaceutical consumption. Of course we lead pharmaceutical production but also pay the highest prices. It would be a disaster for the world as a whole if we tried to save money on this front with tight price controls.

The bottom line: National health insurance is unlikely to save on medical costs, unless it cuts back on treatment drastically.

**Shek** · 04-20-2008, 20:52 PM

EconLog, Kling and Mankiw on Health Care, Arnold Kling: Library of Economics and Liberty

Quote:

November 5, 2007
Kling and Mankiw on Health Care
Arnold Kling

I talk for an hour with Russ Roberts, here. I'd love to hear your comments. Don't forget to vote for econtalk in the podcast awards.

Finally, Greg Mankiw raises some issues with health care statistics.

1. International comparisons of longevity are distorted by things like homicide rates and low-birth-weight infants.

2. The number of uninsured is boosted by: illegal immigrants; people eligible for Medicaid who have not signed up; and people earning over $50 K per year

3. Increasing expenditures on health care is not necessarily a bad thing.

Before I started delving into health care economics, I was thinking along similar lines, all of which tend to defend America's health care system. But I wound up in a different place, because of two facts. The first fact is that most of the "surge" in health care spending in the past 30 years has been in procedures involving specialists and high-tech medical equipment. The second fact is that comparisons of groups of people receiving different levels of these types of services almost always show no difference in outcomes. This leads me to believe that we make extravagant use of medical procedures with high costs and low benefits. We are, in Shannon Brownlee's term, overtreated.

We might be healthier if we spent less money on health care.

UPDATE: I prefer Clive Crook's piece (link may not work at some later date, because of the way they over-write his columns at National Journal) to Mankiw's.

I don't want to be in the position of defending America's health care system. The position I want to take is against demagoguery, whether it comes from politicians or pundits. The demagogues say that we can continue to insulate people from costs using employer-provided health insurance and Medicare, plus insulate more people through "universal coverage," and afford it all.

You remind the demagogues that Medicare and employer-provided health insurance are both unraveling on the financial end. They say, "Oh, right. We have to cut costs."

But cutting costs means changing health care as we know it, in order to reduce the extravagant use of medical procedures with high costs and low benefits. That means either drastically reducing individual choice (by having government dictate which procedures can be done) or drastically increasing individual responsibility (my approach). What the demagogues won't tell you is that they are forcing us down the path of government rationing, when some of us might not like that so much.

**Shek** · 04-20-2008, 20:54 PM

WEALTH OF NATIONS: Democrats Are Winning On Health Care (11/02/2007)

Quote:

WEALTH OF NATIONS
Democrats Are Winning On Health Care
By Clive Crook, National Journal
Friday, Nov. 2, 2007

Last week National Journal's Marilyn Werber Serafini provided the best, most detailed, and most balanced account I have seen of the leading presidential candidates' health care proposals. Drawing on interviews with a politically mixed group of scholars and policy experts, she laid out the proposals' respective drawbacks and advantages.

The Republican plans are cheaper, of course, but only because they are so much less ambitious.

The conclusion I drew from her reporting is that you cannot have something for nothing. Obvious as this might seem, it is a point that all of the candidates, in their different ways, are trying to deny. In simplest terms, the Democrats argue that you can achieve universal coverage without loss of quality (in fact, with better quality) at no great extra cost.

And Republicans argue that you can achieve universal "access" -- not the same thing as coverage but meant to sound as good -- not only without spending a lot more but also without mandates or new regulation.

Both claims are wrong, and voters know it. The big question for the electorate is simple: Do Americans want universal coverage enough to put up with significant additional cost and added government interference? If so, Democrats have found a winning issue.

You cannot repeal that basic trade-off, although you can improve its terms and make it less severe. But it is difficult to do even that unless you acknowledge that the trade-off exists -- and neither side is apparently ready to do so.

The politics of the issue has moved a long way in the Democrats' favor. Public opinion has shifted, the polls say, in favor of universal coverage as a goal. Worries over the rising cost and availability of health insurance are a big part of the wider trend of rising economic anxiety. Americans' desire to see this problem fixed is greater now than it was in the early 1990s, when Hillary Rodham Clinton's previous health reform proposal was shot down.

At the same time, the Democrats -- and, above all, Clinton herself -- have radically altered their approach to the issue. Look at the way she pitches her plan on her campaign website. If you are happy with your existing health insurance arrangements, she insists, nothing will change. After the "Hillarycare" fiasco, that reassurance is crucial.

The Democrats' schemes all envisage an expanded government role -- as they must, if universal coverage is to be achieved -- but they are not single-payer "socialized medicine" plans. Moreover, that fact is obvious. The Republicans' insistence that these schemes amount to socialized medicine is implausible and smacks of desperation. The voters are not buying it.

Clinton's promise that nothing will change if you are happy with your health insurance underscores the notion that she is not proposing a government-run near-monopoly such as Britain's National Health Service. Private insurance goes on. You stay on the plan you already have, if you like it. Under the Democrats' proposals, more people will have private insurance (initially at least) than do now.

The Democrats call for more regulation -- an individual mandate in the plans of Clinton and John Edwards (Barack Obama's approach is a bit less sweeping), plus requirements on employers and leverage applied to insurers and pharmaceutical companies. Critics can fairly say that some of this regulation is really about shifting and disguising costs, but voters are unlikely to mind much. Yes, they should be worried about what these new rules will cost their employers because in the end much of it will come out of their pay -- but as a matter of practical politics, few will be concerned. A cost imposed on business is fine with voters. The Democrats' chief vulnerability, now that the socialized medicine scare has been neutered, is the fear that the cost of wider coverage will push up taxes -- everybody's taxes, not just the taxes of the rich.

This fear is justified because the Democrats' plans are weak on cost control. In the interviews for last week's report, National Journal asked the health care experts to grade the candidates' plans from 1 to 10 on their chances of achieving a variety of goals, with 1 being the lowest score and 10 being the highest. On the goal, "Reform would be funded with existing health care dollars," the experts gave the Clinton, Edwards, and Obama proposals scores of 4. On the goal, "Brings the rate of growth in health care spending in line with the economy's growth rate," Clinton's plan got 4 again, and Edwards's and Obama's plans got just 3. On that second test, by the way, the timid plans of Republicans Rudy Giuliani and Mitt Romney did no better than Clinton's: The experts marked both a 4. John McCain's plan for a refundable tax credit to pay for private insurance did better, scoring a 6.

All three Democrats are counting on savings from providing better and more efficient care, through such initiatives as the adoption of electronic patient records, better prevention, and better management of chronic disease. These things are all worthy aims in their own right, of course. How much money they would save, and how quickly, is more debatable. (Britain's attempt to computerize its medical records turned into one of the biggest and most expensive information-technology fiascos ever seen.) In addition, the Democrats' plans would let some or all of the Bush administration's tax cuts expire for the "highly paid" (which they define in different ways, if at all), and would apply that money to health reform. The experts doubt, however, if the savings would be enough to balance the books over time.

The greatest challenge is to curb the long-term growth of health care spending. Only two ways exist to do that. One is to ration on the supply side -- by the government denying or discouraging certain kinds of treatment that it deems not cost-effective. The other is to ration on the demand side -- by confronting patients with more of the costs of their care, so that they economize and force suppliers to compete on price.

Neither mechanism operates well in the current health care system. There is no single-payer to police the use of the system, and patients think that their health costs are small because most have insurance provided by their employers. The result is exploding costs and increasingly unaffordable insurance.

McCain's proposal gives demand-side rationing a nudge -- by taxing employees on the portion of their health insurance that their employers pay. Those costs would be offset for many employees by providing them with a tax credit of $2,500 for individuals and $5,000 for families. But employees with generous health insurance plans could face higher taxes. He throws in tort reform for good measure, as a way to cut medical costs. None of the other plans, Democratic or Republican, has much to say about incentives for cost control.

Suppose Clinton becomes president and puts her plan into effect: How would the government accommodate the upward pressure on costs? Partly through taxes, one imagines; partly through price-curbing regulation of insurers and drug companies. Another possibility would be to promote price competition among insurers through the management of the Medicare-style public plan that Clinton proposes to offer as an option. Moves to encourage the use of plans with high co-payments and deductibles would increase the demand-side discipline on costs -- one way to improve the trade-off between coverage and outlays.

The Republican plans are cheaper, of course, but only because they are so much less ambitious. Giuliani proposes some tax incentives to encourage people to buy insurance, McCain proposes a more generous subsidy scheme, and Romney (the only candidate who, as former governor of Massachusetts, can claim to have implemented a market-based, individual-mandate, universal-coverage scheme) merely wants to grant more flexibility to the states. None of these ideas -- not even McCain's, the best of the bunch -- frontally addresses the belief that the system is broken and, as a high national priority, needs far-reaching reform.

Do Americans really believe that reform is needed? They do, I think -- and if they do not, they should. Republicans may be underestimating one factor in the shift of opinion on the issue. Lack of insurance is no longer partly a matter of choice (as in the case of the young and fit who prefer not to buy coverage even if they can afford it), or else a problem only for the poor. Economic insecurity is on the rise for most Americans, not just for a static minority of poor people. People change jobs more often than they used to, whether they like it or not. And in the United States, when you change jobs you worry about your health insurance.

What if your next employer offers no coverage? What if a pre-existing condition makes an individual policy too expensive or altogether unavailable? The guarantee of universal coverage is something that almost all Americans, including those covered at present, would value and be willing to pay something for. And they know that every other rich country in the world provides it. As long as reform does not put them at an immediate disadvantage -- either by forcing them off plans they are happy with, or by pushing up their own taxes -- it is something they will vote for. The Democrats are offering reassurance on both points (more plausibly on the first than the second). They are on to something.

-- Clive Crook is a senior writer for National Journal magazine, where "Wealth Of Nations" appears. His e-mail address is ccrook@nationaljournal.com.

**Shek** · 04-20-2008, 20:55 PM

Arnold Kling on the Economics of Health Care and the Crisis of Abundance, EconTalk Permanent Podcast Link: Library of Economics and Liberty

Quote:

Arnold Kling on the Economics of Health Care and the Crisis of Abundance

November 05, 2007, Featuring Arnold Kling

Arnold Kling of EconLog talks with EconTalk host Russ Roberts about the economics of health care and his book, A Crisis of Abundance: Rethinking How We Pay for Health Care. Kling discusses whether we get what we pay for when we spend money on health care, why health care isn't like cars, and why health care insurance isn't really insurance. The conversation closes with a discussion of innovation in America's health care system and why America is so unlike everywhere else.

JAD_333 · 04-21-2008, 00:48 AM

Quote:

Originally Posted by Gun Grape

Except for the VA I have never had to wait more that 2 days to see my primary Doctor.

You were fortunate. The wait time for my wife to see her gynacologist is 6-8 weeks and some test the ladies take (can't recall the name) is a 6 month wait, and we're not entirely in the sticks. On the other hand, I can see my VA doc the next day and a specialist at Martinsburg Hospital in 3-5 days. It seems your VA setup down there is below the norm for VA nationwide.

Quote:

But I don't have to go to India to see a Doctor. My doctor is Indian

lol...mine is Pakistani.

JAD_333 · 04-21-2008, 01:32 AM

Quote:

Originally Posted by Shek

JAD,

He's definitely not a lobbyist. A supporter of harnessing markets? Yes, but a lobbyist, no.

I only said he sounded like a lobbyist.

Quote:

Remember, much of his argument resides on the fact that the US provides innovation for the world, and while it costs a little more to do this, the social benefits outweight the social costs (which are different than budgetary benefits and costs).

I'll read his articles, but if you're right about his argument, we can cut to the chase.

Our providing innovation for the world should not add any more to our health care costs relative to countries with a national system. Afterall, the latter have to buy equipment too. In any case, I wouldn't advocate the medical equipment industry be non-profit. But the industry would be under pressure to produce less expensive equipment if fees to patients were lowered, such as happened in Japan with MRI equipment. I don't see any social benefit in the social cost here.

Quote:

As a second point to ponder - think about the average health of an American vs. the average health of a Swiss, or someone in Japan, etc. Given our low relative health, we'd expect to pay more no matter what health system we have (it doesn't take a doctor to know that being fat is bad for you, so while preventative medicine can help, it isn't a silver bullet, either).

It's not like you to reach for straws. That is if you're saying what I think you're saying: that American are less healthy than the Swiss, Japanese, etc., therefore we have higher health care costs. I won't argue who is healthier, but it's an established fact our costs for doctor visits and procedures are higher across the board.

JAD_333 · 04-21-2008, 02:10 AM

Quote:

Originally Posted by Shek

I've pulled a bunch of articles down.

Taking them one at a time:

Quote:

November 4, 2007
Beyond Those Health Care Numbers
By N. GREGORY MANKIW

WITH the health care system at the center of the political debate, a lot of scary claims are being thrown around. The dangerous ones are not those that are false; watchdogs in the news media are quick to debunk them. Rather, the dangerous ones are those that are true but don’t mean what people think they mean.

I agree, but...

Quote:

Here are three of the true but misleading statements about health care that politicians and pundits love to use to frighten the public:

STATEMENT 1 The United States has lower life expectancy and higher infant mortality than Canada, which has national health insurance.

He debunks this claim expertly by pointing to studies that show we have more deaths by accident, murders and obesity. All well and good, but the issue is cost, and it costs less for health care in Canada.

Quote:

STATEMENT 2 Some 47 million Americans do not have health insurance.

This number from the Census Bureau is often cited as evidence that the health system is failing for many American families. ...

To start with, the 47 million includes about 10 million residents who are not American citizens....

The number also fails to take full account of Medicaid, the government’s health program for the poor...

The 47 million also includes many who could buy insurance but haven’t. The Census Bureau reports that 18 million of the uninsured have annual household income of more than $50,000...

Of course, millions of Americans have trouble getting health insurance. But they number far less than 47 million, and they make up only a few percent of the population of 300 million.

I winnowed his points down to the essentials. To start with, out of the 10 million non-citizens you have green card holders who pay taxes, FICA, etc.

Medicaid would disappear under a national health system, so why mention it.

He implies that households with $50K/yr income and up without insurance could have it if they wanted to. I would argue that $50K for the average homeowner isn't as much as it sounds like, especially after taxes. But again, the issue is the high cost of insurance.

Quote:

STATEMENT 3 Health costs are eating up an ever increasing share of American incomes.

In 1950, about 5 percent of United States national income was spent on health care, including both private and public health spending. Today the share is about 16 percent. Many pundits regard the increasing cost as evidence that the system is too expensive.

But increasing expenditures could just as well be a symptom of success. The reason that we spend more than our grandparents did is not waste, fraud and abuse, but advances in medical technology and growth in incomes....

Fortunately, our incomes are growing, and it makes sense to spend this growing prosperity on better health. ...

He doesn't come anywhere near debunking this so-called myth. In fact he creates another myth: that higher costs are the result of better care. He completely ignors the fact that medical care and medicine in this country cost more because it is profit-based and costs billions to administer.

Quote:

Mr. Hall and Mr. Jones forecast that the share of income devoted to health care will top 30 percent by 2050. But in their model, this is not a problem: It is the modern form of progress.

This statement tops them all. Can he be serious?

We're at 16% now and we could be below 10% if we put together a cost-effective system. How can he blithely state that 30% will be ok? Is he thinking we'll be living to 150.

Quote:

Even if the rise in health care spending turns out to be less than they forecast, it is important to get reform right. Our health care system is not perfect, but it has been a major source of advances in our standard of living, and it will be a large share of the economy we bequeath to our children.

Another badly thought out statement, and this guy is at Harvard. What isn't spent on profitable medical care industry will be spent elsewhere. Who wouldn't rather buy new furniture than pay for $20K for a minor operation? So the furniture industry does better and the medical does worse. Where's the loss?

Quote:

N. Gregory Mankiw is a professor of economics at Harvard. He was an adviser to President Bush and is advising Mitt Romney, the former governor of Massachusetts, in the campaign for the Republican presidential nomination.

hmmm...

http://www.nytimes.com/2007/11/04/bu...ss&oref=slogin[/quote]

JAD_333 · 04-21-2008, 02:37 AM

Shek:

Better reasoned, but flawed in one respect.

Quote:

Poor U.S. Scores in Health Care Don’t Measure Nobels and Innovation

By TYLER COWEN
Published: October 5, 2006

Advocates of national health insurance cite an apparently devastating fact: the United States spends more of its gross domestic product on medical care than any nation in the world, yet Americans do not live longer than Western Europeans or Japanese. More Americans lack insurance coverage as well. It is no wonder that so many people demand reform.

But the American health care system may be performing better than it seems at first glance. When it comes to medical innovation, the United States is the world leader. In the last 10 years, for instance, 12 Nobel Prizes in medicine have gone to American-born scientists working in the United States, 3 have gone to foreign-born scientists working in the United States, and just 7 have gone to researchers outside the country. ...

This is true, but it doesn't follow that medical machinery add up to health care per se. Making machines is an industry, a lucrative one, and I see no reason why we can't continue to be a major world player no matter how we structure our medical delivery system. As I mentioned before, all countries with effective universal health care systems have to buy machines. Why does this justify charging American patients more than Japanese patients?

Quote:

In real terms, spending on American biomedical research has doubled since 1994. By 2003, spending was up to $94.3 billion (there is no comparable number for Europe), with 57 percent of that coming from private industry. The National Institutes of Health’s current annual research budget is $28 billion, All European Union governments, in contrast, spent $3.7 billion in 2000, and since that time, Europe has not narrowed the research and development gap. America spends more on research and development over all and on drugs in particular, even though the United States has a smaller population than the core European Union countries. From 1989 to 2002, four times as much money was invested in private biotechnology companies in America than in Europe.

This begs the question.

Isn't it interesting that the government is already spending $28 billion a year, or 48%, of the annual cost of bio medical research in the US.

He has a way of referring to research, machines and medicines as health care. Those are implements of health care. The actual health care comes when people go to their doctors, etc., and it's the doctor's high fee and the cost of the battery of tests and medicines he perscribes that is at issue.

But even he finally comes around to the view that changes are needed:

Quote:

American health care has many problems. Health insurance is linked too tightly to employment, and too many people cannot afford insurance. Insurance companies put too much energy into avoiding payments. Personal medical records are kept on paper rather than in accessible electronic fashion. Emergency rooms are not always well suited to serve as last-resort health care for the poor. Most fundamentally, the lack of good measures of health care quality makes it hard to identify and eliminate waste.

These problems should be addressed, but it would be hasty to conclude that the United States should move closer to European health care institutions. The American health care system, high expenditures and all, is driving innovation for the entire world.

Tyler Cowen is a professor of economics at George Mason University and co-writer ofa blog at Marginal Revolution. He can be reached at tcowen@gmu.edu.
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04-20-2008, 15:06 PM	#76 (permalink)
Shek *Military Professional* Moderator Join Date: 02-23-05 Location: Krblachistan Posts: 7,805 Country:	JAD, Thanks for the reference. This is a busier week, so I probably won't get around to fully checking it out until later. FRONTLINE:sick around the world \| PBS __________________ "So little pains do the vulgar take in the investigation of truth, accepting readily the first story that comes to hand." Thucydides 1.20.3

04-20-2008, 17:00 PM	#78 (permalink)
Tarek Morgen *Senior Contributor* Join Date: 02-08-07 Location: Kassel Posts: 906 Country:	Then I am wondering why medicin is so exepensive in your country. __________________ uh I might be wrong

04-20-2008, 17:16 PM	#79 (permalink)
lwarmonger *Military Professional* Join Date: 02-08-05 Posts: 1,784	Just thought I'd weigh in. I'd consider myself first in line to be in favor of the free market, but the numbers don't lie. We pay two to three times as much for a far inferior result compared to other industrialized nations. Even taking into account the inferior health of much of our population (one of the unfortunate effects of a suburban commuter society I'm afraid) that is still unacceptable. We need to start a program that can cut costs and improve preventative coverage, and I must admit that the style of programs that JAD has been describing sounds pretty attractive.