Tag Archives: Health Care

Scarcity of arguments

Paul Krugman puzzles over a dazzling bit of dishonesty in a Wall Street Journal op-ed on Oregon’s Medicaid program.  Here’s the basic issue:

Aaron Carroll reads the Wall Street Journal, which is outraged, outraged, at the prospect that Oregon’s Medicaid system might seek to limit spending on treatments with low effectiveness and/or patients who aren’t going to live much longer in any case. Death panels!

Carroll points us to the actual staff recommendation, which is far milder than the WSJ blast would have you believe. But as Carroll points out, the larger point is the absurdity of the Journal’s position. On one side, it’s fanatically opposed to Medicaid expansion — that is, it’s eager to make sure that millions have no health coverage at all. On the other side, it claims to be outraged at the notion of setting priorities in spending on those who do manage to qualify for Medicaid. It’s OK for people to die for lack of coverage; it’s an utter horror if taxpayers decline to pay for marginal care.

Krugman (and the Aaron Carroll, whom he is citing here) doesn’t quite put the matter this way, but it seems to me that you have a basic issue of scarcity here: in part on account of objections from conservatives, money for Medicaid is short.  So best to distribute what little there is to those who need it, not everything can be covered.  So the discussion ought perhaps to be about that.  That’s not, sadly, what the Wall Street Journal was interested in.  Their interest, rather, was in using such perennial problems as evidence that Big Government will put you to death.  That is a rather different issue.

So Krugman wonders:

So I understand what’s going on here. What I don’t understand is the mindset of the editorial writers. At some level they have to know that they’re engaged in an act of grotesque cynicism. Do they admit that to themselves? Do they rationalize it by saying that truth is a secondary consideration when you’re engaged in a crusade against the evils of big government? Have they mastered true Orwellian doublethink, managing to believe things they know aren’t true?

My vote is they are probably capable of knowing the difference, but have long ago confused success at selling an idea with the idea’s being true.  Or perhaps something else: they believe their are better arguments out there, and though the one they offer may be a stinker, you argue with the arguments you have, not the ones you’d like to have.  Someone, after all, will come along an iron man them out of this one.

The public option

The ongoing (and coming?) health care debate will no doubt be a gold mine of sloppy and dishonest reasoning.  We've already noticed some examples of this already.  Just as the debate over gay marriage seems to inspire certain particular patterns of fallacious reasoning (the equivocation on "marriage" and the slippery slope), I think the health care debate will have its own definitive fallacies.  At the moment, I'm thinking that we'll see a lot of red herring–changing the subject from the less appealing facts of the matter (for instance, the fact that Americans pay more for health care and get less than other developed nations) to tangentially related, yet incendiary, notions such as "socialism."

But I think we'll also see a whole lot of weak analogy–in particular comparisons of health insurance to any other complex consumer product.  Here's one from George Will yesterday:

Some advocates of a public option say health coverage is so complex that consumers will be befuddled by choices. But consumers of many complicated products, from auto insurance to computers, have navigated the competition among providers, who have increased quality while lowering prices.

Those things are different in that they are largely optional purchases.  Sure, you "need" them, but you don't need them.  I might mention, by the way, that auto insurance is legally mandated for all drivers (yet another difference from health insurance–and I doubt, by the way, that Will would advocate such a mandate).  In any case, before one starts comparing health insurance to any other consumer product, one ought to take note of the vast differences.  Few products typical consumers (i.e., anyone of any income level) would absolutely have to buy involve possible outlays of hundreds of thousands of dollars.  And few of those products carry with them (often in their fine print) the real possibility of physical and financial ruin.

In the interest of fairness, I should point out that this entire piece, however bad, does not argue against the feasibility or desirability of single-payer health coverage.  In fact, it does a lot to make the case for it (though not on purpose).  Will's purpose is merely to argue against the "public option."  I think his argument is bad (citing as it does Mort Kondrake and a health insurance industry funded study), but I think such an option is a bad one (for other reasons).  

You’re on your own

It wasn't long ago that George Will called Obama's very catchy "you're on your own" line (from his acceptance speech) a straw man of the (discredited) Republican philosophy of government.  So I was struck when I read this encomium to being on one's own (creepy lines in bold).

When Medicare was created in 1965, America's median age was 28.4; now it is 36.6. The elderly are more numerous, and medicine is more broadly competent than was then anticipated. Leavitt says that Medicare's "big three" hospital procedure expenses today are hip and knee replacements and cardiovascular operations with stents, which were not on medicine's menu in 1965.

After being elected to three terms as Utah's governor, but before coming to HHS, Leavitt headed the Environmental Protection Agency. He came to consider it a public health agency because the surge in Americans' longevity in the last third of the 20th century correlated with cleaner air and fewer waterborne diseases. Longevity is, however, expensive, and demography is compounding the problem.

In the 43 years since America decided that health care for the elderly would be paid for by people still working, the ratio of workers to seniors has steadily declined. And the number of seniors living long enough to have five or more chronic conditions — 23 percent of Medicare beneficiaries — has increased. Many of those conditions could be prevented or managed by better decisions about eating, exercising and smoking. The 20 percent of Americans who still smoke are a much larger percentage of the 23 percent who consume 67 percent of Medicare spending. Furthermore, nearly 30 percent of Medicare spending pays for care in the final year of patients' lives.

If only we could find some kind of completely tone-deaf market analogy for how medicare should work:

Suppose, says Leavitt, buying a car were like getting a knee operation. The dealer would say he does not know the final cumulative price, so just select a car and begin using it. Then a blizzard of bills would begin to arrive — from the chassis manufacturer, the steering-wheel manufacturer, the seat and paint manufacturers. The dealership would charge for the time the car spent there, and a separate charge would cover the salesperson's time.

Leavitt says that until health-care recipients of common procedures can get, upfront, prices they can understand and compare, there will be little accountability or discipline in the system: "In the auto industry, if the steering-wheel maker charges an exorbitant price, the car company finds a more competitive supplier. In health care, if the medical equipment supplier charges an exorbitant price, none of the other medical participants care."

The auto industry?  The one with the huge bailout?  Anyway, back to the ice floe:

Rather than ruining the new year by dwelling on Medicare's unfunded liabilities of about $34 trillion (over a 75-year span), ruin it with this fact: In the next 50 years, Medicaid, the program for the poor — broadly, sometimes very broadly defined — could become a bigger threat than Medicare to the nation's prosperity.

This is partly because of the cost of long-term care for the indigent elderly, some of whom shed assets to meet Medicaid's eligibility standard — sometimes as high as income under 200 percent of the federal poverty level. And many states, eager to expand the ranks of the dependent with the help of federal Medicaid money, use "income disregards" to make poverty an elastic concept. For example, they say: A person who gets a raise that eliminates his eligibility can disregard the portion of his income that pays for housing or transportation.

Governments with powerful political incentives to behave this way will play an increasingly large role in health care. As is said, if you think health care is expensive now, just wait until it is free.

Indigent elderly, since you're a threat to our nation's prosperity, "you're on your own."