Obamacare

If You Read Only One Article on Health Care This Year, Read This One (And The One It Links Back To) By Virginia Postrel

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Former Reason Editor in Chief Virginia Postrel wrote the smartest, most insightful critiques of centralized health care plans during the 1990s.

Now at The Atlantic, she has written two excellent related pieces about looming changes to health insurance and treatment. Her work is rich in analysis and detail and stresses basic points that are typically overlooked. There is no simple fix, she argues. Most people want free-to-them treatment, regardless of the larger costs in terms of pharmaceutical, technological, and provider innovation. Most politicians want to clamp down on costs and jack up government oversight. Free-market folks often simplify the issues at stake. Centralizing decisions in virtually any business or service sector leads to predictably bad results over time.

Here's a snippet, but I urge you to read the whole thing.

Health care isn't a single good, nor, like food, is it easily defined in terms of a minimum to sustain life. Studying other countries' supposedly universal systems only demonstrates how fraught the concept of "health care" is: one bundle of services in British Columbia and a less-generous one in Nova Scotia, one in England and another in Scotland, one in New Zealand before the election and another afterwards. Arguably the U.S. already has universal care, in the sense that everyone can get some care-if only from an emergency room-for some things, and that citizens (a critical word in this context) without money are covered by Medicaid. The real issue is how you define "health care." What gets included is a matter not only of medicine and economics but of culture and politics.

Start the whole thing here.

Postrel's Reason archive here.

As with education, we are slowly shuffling toward the sort of individualized service that we take for granted at the neighborhood coffeehouse. It is way to slow a process and (again like education) entire generations will lose out because of the snail's pace of change. As the public sector starts to hog the roast beef at the cold-cut table (often in conjunction with private industry), it is worth keeping in mind that the parts of American life that are most annoying (K-12 education! health care!) are also the ones in which creative destruction is most hemmed in.

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  1. Raivo Pommer-eesti-www.google.ee
    raimo1@hot.ee

    MILLIARDEN

    Der M?nchner Medienunternehmer Leo Kirch hat im milliardenschweren Schadenersatzstreit mit der Deutschen Bank eine Niederlage erlitten. Das Landgericht M?nchen I wies am Dienstag eine Klage von 17 ehemaligen Firmen des Kirch-Konzerns (KGL Pool) ab. Sie hatten ?ber zwei Milliarden Euro gefordert.

    Grundlage der Klage war eine ?u?erung des damaligen Deutsche-Bank-Chefs Rolf Breuer im Februar 2002. Er hatte darin die Kreditw?rdigkeit des Medienimperiums von Kirch bezweifelt. Am 8. April 2002 musste mit der KirchMedia das wichtigste Unternehmen der Kirch-Gruppe Insolvenz beantragen.

  2. Virginia Postrel does a lot of chopping but no chips are flying. Reason has gotten way better since she left 😉

  3. If there is a private sector solution to education and health care, where is it? Where is the market now? And don’t give me any crap about taxes. Taxes schmaxes. And spare me the Marie Antoinette attitude as well. “If they don’t like public schools, why don’t they just send their kids to private schools? Are they just too cheap to pay for it?”

  4. …and what neighborhood coffee house? What is it that you want? Humble local cafes or franchises of huge corporate chains? Where are you getting this fantasy of capitalism. As the Gang of Four once sand, “Capital. It fails us now.”

  5. Warren,

    Whats the ruling on that? Am I supposed to drink? Spit back into the bottle? What?

  6. If there is a private sector solution to education and health care

    Give cash to school/doctor. Get education/health care.

    Ummmm. Done. Both are available.

  7. I’m just waitin here to see if robc spits or swallows.

  8. I’m going to start a list of stupid people.

    Ray Butlers will be somewhere between Barack Obama and that Leave Brittany Alone kid.

  9. Obviously, Ray Butlers fails to recognize that our “health care” system is already socialized medicine. Whatever it is, it is not the free market.

  10. Right Ray, Here’s another right winger ranting about vouchers and crap:

    giving all Americans insurance vouchers and getting rid of employer-based health-care coverage-bear little resemblance to those embraced by the president.

  11. RayButlers sounds like most of my coworkers, unfortunately.

  12. However, Virginia Postrel, like many Reasonoids, fails to seriously and comprehensively examine why “health care” costs so much in the first place. Note the modifiers seriously and comprehensivesly.

    In a truly free market, there would be no need for health insurance. There would be no Medicae, no Medicaid, no third party payors and there would be no licensure of health care providers. There certainly would be no need for a Bolzhevik agency inspired by a dope like Utpton Sinclair.

  13. Why does it cost $185.00 to see a primary care physician for 10 minutes? The answer is NOT the free market.

  14. RayButlers:
    And spare me the Marie Antoinette attitude as well. “If they don’t like public schools, why don’t they just send their kids to private schools? Are they just too cheap to pay for it?”

    It’s the anti-market side that imitates Antoinette. You’re projecting. Supporters of government-run schools generally deny that, because of the burden of taxation, the government monopolizes education for lower-income families.

    It always sucks to be poor. In a free education market, poor families would still get fewer options for educating their kids than rich families. But they would have more options if they didn’t have to subsidize crappy government schools with their taxes.

  15. If there is a private sector solution to education…

    Let us have a voucher program for more than 5 seconds and we’ll show you — that is, if you can get permission from your NEA masters for that long…

    and health care, where is it?

    You mean the healthcare “system” that was working just fine until the FDA and Medicaid started fucking everything up? You remember, back when we used to find cures for diseases rather than government-funded, lifelong treatments. Whatever keeps one on the plantation I guess.

    Where is the market now?

    It’s being crushed under the regulation and meddling of the past 30 years. Look now, because it may be gone soon and you might miss it.

    And don’t give me any crap about taxes.

    I won’t, so long as you’re willing to cover the cost of everything you want out of pocket. If you want to take my money, you’ll need to hear my complaints…

  16. I assume this is a typo: “It is way to [sic] slow a process and (again like education) entire generations will lose out because of the snail’s pace of change.”

  17. What gets me is the idea that preventative medicine is going to save so much money. We’ll end up paying to treat every and any potential problem. We may end up living a little longer, but the cost will be a lot higher than just fighting actual illnesses.

  18. What gets me is the idea that preventative medicine is going to save so much money. We’ll end up paying to treat every and any potential problem. We may end up living a little longer, but the cost will be a lot higher than just fighting actual illnesses.

    Actually, this is more of an empirical than a priori fact. It’s hard to tell, and certain preventative “treatments” can vastly reduce the chance of multiple problems, at very little cost. Think exercise and vitamins.

  19. Think exercise and vitamins.

    Everyone out for motivational exercises!!

  20. Excercize, sure. Vitamins, not so sure, other than the minimal amounts that are available in any decent diet. The main treatment cost will probably be the drugs we take to stave off the worrying that something must be wrong with us.

  21. “Virginia Postrel does a lot of chopping but no chips are flying. Reason has gotten way better since she left ;)”

    She’s the reason I stopped subscribing to Reason, because of her support for Desert Storm.

  22. In a truly free market, there would be no need for health insurance.

    Why in the world do you think that? In a truly free market, some things would still be prohibitively expensive and insurance would have a role there. Insurance in that world would be against unforeseeable, non-routine expenses (like six months of rehab after an accident), not something to pick up $15 here and there on medicine…

    It’s the same reason I would still opt for auto insurance willingly even if it weren’t mandated by the state: I think it’s a good investment. For me, catastrophic health insurance would make a lot of sense. What doesn’t make sense is the current system that sees insurance as a buffer between people and routine, foreseeable expenses…

  23. Here’s an example of a private company doing its part: Walgreens Giving Free Health Care

    Why would they do this? “…a typical Take Care patient tells eight other people about his or her experience.”

    Help the jobless sick people, and possibly help the company. Profit motivated philanthropy can work.

  24. Healthcare run by the TSA should be amusing.

  25. So many Ayn Rand cultists…so few guillotines.

  26. Untermensch-

    I’m with John Stoessel. Does one need food insurance?

    I think you are missing my point. Most of the health care items that are priced so prohibitively are priced that way because of (1) the state’s involvement in health care-after all the state pays for 70% of the tab as it is; (2) licensure of most health care providers; (3) third party payment mechanisms and (4) the active supression of alternative treatment modalities.

  27. We should set about forbidding health insurance, not making it mandatory.

    Consumers of healthcare are disconnected from the market, so there is no market force brought to bear. Reconnect them directly, and costs will come down to reasonable levels, as every consumer will have freedom of choice, and health care providers would by necessity compete.

  28. Libertymike, you forgot (5): the insane cost of certifying anything for use in human medicine.

  29. I think you are missing my point. Most of the health care items that are priced so prohibitively are priced that way because of (1) the state’s involvement in health care-after all the state pays for 70% of the tab as it is; (2) licensure of most health care providers; (3) third party payment mechanisms and (4) the active supression of alternative treatment modalities.

    1) The state does increase the price of healthcare for numerous reasons, some good, some bad.

    2) Eliminating healthcare licensure would not substantially open the field to practitioners. Although anyone could hang out a shingle, any aspiring provider would still need to obtain malpractice insurance, and insurers would replace independent licensing boards in their function. A neutral outcome for the general public, but a worse situation for the providers themselves.

    3) Third party payment mechanisms increase prices. No argument there.

    4) This is why libertarians look like nutcases.

  30. Libertymike, you forgot (5): the insane cost of certifying anything for use in human medicine.

    It’s expensive as hell to bring a drug or instrument to market, yeah, but it’s still cheaper than paying off thousands of claimants that are injured by the drug or instrument.

    These studies have a lot of upfront costs, but they probably save money for companies on the back end.

  31. I’m with John Stoessel. Does one need food insurance?

    No, because the amount one spends on food is consistent and mostly under their control. You can spend 0 on health care 11 months a year and then get hit with a several thousand dollar surgery the 12th month. Insurance developed for things like that.
    I think in a free market, more people would have catastrophe plans, because there is no reason to pay insurance that covers check ups and physicals.

  32. It’s expensive as hell to bring a drug or instrument to market, yeah, but it’s still cheaper than paying off thousands of claimants that are injured by the drug or instrument.

    A product that dangerous wouldn’t make it to market, FDA or no FDA.

    Assuming that’s true, why do you need the FDA? I am always amused by arguments justifying law on the basis that it saves the affected parties money, as if they were too stupid to realize that without the helping hand of government guiding their way.

    In today’s “there is no acceptable risk” environment, a product that saved 500 lives and killed 10 would never make it to market. That’s why the market is better than the FDA, it treats people like adults and would offer products the FDA would never approve because there’s no political fallout from allowing people to die while awaiting its approval for a treatment.

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