Sunday, April 4, 2010

Health care and equity

As I see it there are two equity issues with health care. What extra health care assistance, if any, the government should provide to the poor and/or the chronically ill? In both cases I believe some assistance is reasonable but that it should not be an unlimited entitlement.

Poor people have less ability to buy lots of goods and services, food, clothing, housing etc. I don't see why health care should be any different. It may be reasonable for the government to provide a floor but I don't see any reason everybody should be entitled to the best possible health care any more than they are entitled to the best possible food or housing. And I think people should have the same freedom to spend more or less on health care that they have for spending on other things like clothing or cars.

My thoughts about the chronically ill are similar. People are fortunate and unfortunate in many ways and I don't think it is the job of government to attempt to compensate for all misfortune. Particularly when this is an open ended entitlement that can be impossible to fulfill no matter how much is spent. There are many chronic medical conditions that can be alleviated but not cured. I think some government assistance is reasonable for people with costly medical conditions but that it should be subject to a cost-benefit analysis and limited to cases where substantial benefit for reasonable cost is possible. My thoughts here are similar to my thinking about education for "special needs" children. In some cases school districts end up spending more on a single "special needs" child than 100 normal children. I don't think such disproportionate spending is reasonable and I don't think it is reasonable in the case of medical care either.

Note medical care is subject to decreasing marginal returns. In other words the more you spend the less each additional dollar will buy in terms of increased quality of life. So cutting medical spending does not affect outcomes much when you are in the flat part of the curve as we are.


  1. It seems very difficult in this forum for me to get answers to my questions, rather than to some other questions that I could have asked but did not. I referred to buying insurance, not to government assistance when buying it.

    Here is the simplest example of the inequity I mentioned: Two persons of the same age with similar lifestyles and financial resources and without pre-existing conditions want to buy health insurance policies. In general the coverage and cost of the policies available to each of them will differ significantly, depending on factors unrelated to health, such as by whom they are employed.

    Also, any change in one of the unrelated factors, such as becoming unemployed, self-employed. or independent of one's parents, usually requires obtaining a new insurance policy, which often is inferior or unavailable, particularly if by that time a pre-existing condition has developed.

  2. I don't really understand the question. I get all sorts of special offers for things like credit cards or cable TV which probably aren't available to everybody. I don't see a big equity problem with this. The individual insurance market doesn't work very well for a variety of reasons but I don't see why this is an equity problem, it is lousy for everybody. Of course this affects poor people or people with health issues more severely than others as they have more need for cheap quality medical care.

  3. I think you cannot say what you have said without being a moron. Clearly, you seem not to understand the concept of fortunate and unfortunate.
    Yes, "medical care is subject to decreasing marginal returns". But what "margin" are you talking about? You should realize that you are being unsympathetic to 30 million "unfortunate" people. And you should think, THINK, why they are "unfortunate" and why you shouldn't be unsympathetic, and why it is so corruptive to think the way you're thinking in your writing.

  4. This may not be a case of someone being a "moran", but rather with how individuals may deal with compassion issues. It is just luck that allows one person to be in a "fortunate" position, perhaps born rich enough to afford the health care one wants, or "unfortunate" where one has a cancer diagnosis, simple high blood pressure which can make a person uninsurable, or who has longterm job loss. The unemployment figures now approach ten percent thereby making huge numbers of people "unfortunate."Also, the blogger is probably paying far more toward health care for everyone than we are, if he is one of the "fortunate" who can afford his own good quality insurance and hence is paying way more taxes, which get funneled to the poor.

  5. I doubt that 30 million of uninsured are all unfortunate, and I doubt that all of them cannot pay for their insurance. Rewind 10 years back when premiums were not as high as today. A sizable population still was uninsured, because they chose to pay when they need to pay - a valid choice.
    The rampant increases in premiums in recent years are s result of several known problems none of whioh are addressed by the health care reform.
    Someone is being a moron, but it's not JBS.
    Agree w/Mary: without corruptive unsympathetic folks like JBS the wellfare system would fold like a house of cards and uninsured sick could go to see Zimbabwean woodoo medicinemen for their free treatments.

  6. Obviously, several known problems are not addressed by new health care 'reform' because it is not an actual REFORMATION. It is extremely noteworthy how basic health care rights have to be portrayed as a REFORMATION in this nation, and how it's reflective in some groups' corruptive thinking. And how the perception of reformation is so demographic.

    Mary has a point but now let's talk about what's being called 'fortunate'. Whether it is ascribed or achieved, America's several problems lie in its middle class's group thinking that they are the middle class. As long as you don't question that, you don't come up with any kind of real reformation. And you suffer the consequence, be it ignorance, which is a real problem, or more taxation, which is a legit concern.

    As long as you twist your imagination and be in denial about social obligations, you are still going to be a moron no matter who you are, bystanders or presidents. And that moron is a immorality moron.

    I simply don't think any self-respecting human being can consciously be comfortable using 'Zimbabwean woodoo medicinemen' and, say what, for free? Are you the most ignorant nuts, Jerry? Now that I think of your last statement on reflection of America's several problems, it's not just about differences of opinions. It's a problem of having no self-respect when coping with the differences.

  7. Does anyone recall health care being a basic right? can you pls point to me to a reference (like, for example, the Constitution?)
    Now, funny you mention twisting one's imagination, how do you make a connection between one's self-respect and the fact that I oppose government being some kind of wasteful equalizer between classes? I can care for other people more than you and be responsible for what I decide to do about other people's misfortune, and still don't need to call on the government to take over that job. And, as any caring, self-respecting, uncorruptive being you should know that calling people names will bring you nothing (I accompany it by the corresponding hand on chin gesture).

  8. Yes, JBS, the individual insurance market "is lousy for everybody." That is why those who can, generally get group insurance. The inequity is that some people, including even "poor people [and] people with health issues" are able to get affordable group insurance, while others, many of whom are in the middle class, cannot. The latter must live their lives threatened by a sword of Damocles, namely the possibility that they will become severely ill or injured and consequently suffer complete financial ruin. This is a serious inequity, compared to which that of not receiving a deal for credit cards or cable TV is negligible.

    The reference that jerry seeks is indeed in the Constitution. In its preamble the Constitution states that it is being ordained and established in order (among other things) to "promote the general welfare". Then in Article I, section 8, it grants Congress the power to lay and collect taxes to provide for (again, among other things) the "general welfare of the United States". The word "welfare" in this context is not limited to public assistance; it means (to quote my Oxford American dictionary) "the health, happiness, and fortunes of a person or group". Whether you like it or not, all citizens from all "classes" constitute the group encompassed by the United States.

    It would be unreasonable to expect the Constitution to mention health care explicitly, since it does not mention specifically many of the activities in which our government engages, regulating securities markets and allocating the radio spectrum being the first two that come to my mind. The Constitution also should not be expected to mention every "basic right" explicitly. Amendment IX states, "The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people." Privacy is often cited as an example of a right that is not enumerated.

  9. I understand where you are coming from but that is where we disagree so badly, on many points, but essentially: your (+alike) and my (+alike)interpretation of the above and your and my views on the role of government. Government providing broad health care as a basic right to everyone is a far stretch of "promoting general welfare" for me, and always will be. Not only by principle (hmm, how about a basic "right for employment"), but also because it will simply fail to do so. Someone has to pay for those multi-million surgeries, and life-time treatments of the many many people who are chronically ill, be it due to their chronically negligent lifestyle or misfortune. Yet, individual expenses for health care coverage should somehow be magically low, so everyone can keep their iphones, expensive calling/cable plans, and keep up their 7000 calorie/day diet. Or just curb the multi-million lawsuits so doctors can save 100's of k a year on their lawyers. Yes, that is way too hard a habit to change, so let's make a change we can believe in and have government spread the wealth around (ie pay it with other peoples' money). The problem is that such a thing will eventually fail in that it'll either lower the standard of health care in the US, or it will bring the country into bankruptcy. Am I constantly repeating myself here?

  10. Somewhere in this world there must be a healthcare system that actually works for the people. Perhaps we should be taking a page from their book....Where is it?

  11. I still don't see a big inequity if you aren't poor or chronically ill. Most middle class people can obtain group health insurance from an employer. An employer's health plan (or lack thereof) is one thing you consider when you are considering job offers. Of course you may choose to work for a company that doesn't offer health insurance but this is your choice, most middle class people can find a job with health insurance.

    In any case the new health bill does nothing for healthy middle class people without health insurance other than attempting to force them to buy individual insurance. Which they can voluntarily do already.

  12. Consider two persons who accept jobs with the same employer that offers good health insurance. For one the job is an excellent fit to his skills and interests. For the other it is not the job that he really wanted or does best, but he took it to get the health insurance. This is an inequity. It also is bad economics, because the second person would have been more productively employed elsewhere, were it not for the market distortions caused by tying health insurance to certain jobs.

    Despite the unsympathetic rhetoric that we hear, in practice our society is unwilling to deny medical treatment to those who cannot pay. So those of us who can pay already have been paying their bills. My Sep. 17, 2009, comment about the Sep. 16 blog uses this fact to make a case for mandatory health insurance. The same fact also calls into question jerry's claims about the new health care law's net effect on total health care costs. It can be argued, for example, that the cost of giving more people good preventative care is more than offset by the savings arising from the reduced frequency and severity of their illnesses, which now are typically treated in expensive emergency rooms.

  13. So you think it is inequitable that some jobs pay more than other jobs? So you may have choose between a job which you like and a job which pays well? This is a far broader definition of inequity than I am prepared to accept. As for efficiency presumedly better paying jobs are more important to society making it sensible to encourage workers to undertake them rather than more enjoyable but less socially valuable jobs they would prefer.

    There is a market distortion caused by the fact that health insurance provided by an employer is not taxed as part of a worker's income. This encourages employers to offer health insurance rather than taxable money wages. I believe the admistration health plan only limits this form of tax free compensation in a minor way.

  14. Contrary to Shearer's assertions (April 24), I neither "think it is inequitable that some jobs pay more than other jobs," nor deny that unequal pay is often efficient, nor fail to recognize the market distortions caused by tax policy. Although being given access to an employer's group health insurance plan is a form of pay (whether the employer pays for all, some, or none of the premiums), this is no reason to suppose that what I think about health insurance also must be what I think about every other kind of pay, including money.

    As an illustration of a significant difference between health insurance and money, as well as a further illustration of my claim (April 24) that tying adequate health insurance to particular jobs gives rise to inequity, inefficiency, and market distortion, consider Shearer's remarks (April 11) that "the individual insurance market doesn't work very well" and (April 17) that "most middle class people can obtain group health insurance from an employer." Together these seem to imply that someone who would be happier and more productive and earn more money if he were self-employed might nevertheless choose to work for someone else in order to obtain health insurance.

  15. Something can not work well and still not be (economically) inefficient if there is no better way of doing it. Some of the problems with the individual health insurance market are fixable (although the Obama plan in general makes them worse) but others are fundamental. If it is easier for society to tie health insurance to employment it is not inefficient for it to mildly discourage self-employment. Note society may have other reasons (greater tax evasion among the self-employed for example) for discouraging self-employment.

    Probably there are better ways of providing health care than the current system but I don't see the Obama plan as one of them.

  16. Some of Shearer's remarks are kind of a free market theodicy, in which the question, "If free markets are efficient, how can there be inefficiencies?" has the answer, "The invisible hand of the free market responds to obscure efficiencies that cancel the manifest inefficiencies." My own view is that a free market for health insurance does not currently exist because not all consumers are free to purchase comparable products.

    In any case we agree that there are better ways of providing health care than the current one and that the new law leaves much to be desired. See also my comment today on the May 1 blog.