Politics

More Health Insurance is Not the Answer

When someone else pays, costs always go up

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Health care "reformers" keep talking about getting us more health insurance. Then they talk about cutting costs. This is contradictory nonsense.

Insurance, whether private or a government Ponzi scheme like Medicare, means third parties pay the bills. When someone else pays, costs always go up.

Imagine if you had grocery insurance. You wouldn't care how much food cost. Why shop around? If someone else were paying 80 percent, you'd buy the most expensive cuts of meat. Prices would skyrocket.

That's what health insurance does to medical care. Patients rarely even ask what anything costs. Doctors often don't know. Often nobody even gives a damn. Patients rarely ask, "Is that MRI really necessary? Is there a cheaper place?" We consume without thinking.

By contrast, in areas of medicine where most patients pay their own way, service gets better, while prices fall.

Take plastic surgery and Lasik eye surgery: Because patients shop around and compare prices, doctors work hard to win their business. They often give customers their cell-phone numbers. Service keeps increasing, but prices don't. "In every other field of medicine, the price is going up faster than consumer prices in general," says John Goodman of the National Center for Policy Analysis. "But the price of Lasik surgery, on average, has gone down by 30 percent."

This shouldn't be a surprise. What holds costs down is patients acting like consumers, looking out for themselves in a competitive market. Providers fight to win business by keeping costs down and quality up.

Yet politicians keep telling us the solution is more insurance. And they mean insurance not just for catastrophic diseases that could bankrupt us but also for routine treatments.

The politicians are so oblivious to reality that they are on course to make things worse. Obama would force every business to either give workers health insurance or pay a fine into the public system. Why is that something we should want employers to do? Premiums come out of our salaries, but insurers are accountable to our bosses, not to us.

Why not just have a free market where people can buy whatever kind of health insurance they want? Competition would then bring prices down.

Obama and his Senate allies would limit competition by requiring insurers to cover everyone for the same "fair" price. No "cherry picking," the president says. No charging healthy people less.

They call this "community rating," and it sounds fair. No more cruel "discrimination" against people who have a preexisting condition, obese people or smokers. But such simple-minded one-size-fits-all rules take from insurance companies their best price-dampening tool: Risk-based pricing encourages people to take better care of themselves, just as car-insurance companies reward good drivers. With one-size pricing your car-insurance company must give the town drunk the same deal it gives you.

Insane, but the health-insurance industry is playing along. Insurers say that if government forces everyone to have insurance, they will accept all customers regardless of preexisting illnesses.

They also offered to stop charging higher premiums to sick people. They're even giving up on gender differences.

Sen. John Kerry huffed, "The disparity between women and men in the individual insurance market is just plain wrong, and it has to change." The president of the industry trade group, Karen M. Ignagni, agreed that disparities "should be eliminated."

Give me a break.

Women pay more than men for health insurance for good reason. Despite being healthier than men, they incur higher costs because they go to doctors more often, and they take more medicine. Kerry is pandering. I don't recall him demanding that men be protected from higher life-insurance and auto-insurance premiums.

"Community rating" hides the cost of health care. It's as destructive as ordering fire insurance companies to charge identical premiums for wood frame and stone houses. Universal health insurance with "no discrimination" pricing will make health care costs rise even faster.

When politicians interfere with free markets, unintended consequences harm everyone, except the companies that lobby hard enough to protect themselves.

Is it too much to expect our rulers to understand this?

John Stossel is co-anchor of ABC News' 20/20 and the author of Myth, Lies, and Downright Stupidity.

COPYRIGHT 2009 BY JFS PRODUCTIONS, INC.
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  1. I suppose risk based premiums will discourage people from getting older.

  2. What is apparently missed is that when everyone pays the same, the cost of premiums will rise to the higher levels that unhealthy people pay rather than the lower levels that healthier people get.

    Insurance companies have an obligation to their shareholders to not lose money. Of course, if they do, they can just get a bailout.

  3. “When politicians interfere with free markets, unintended consequences harm everyone,”

    Are you so sure the consequences are unintended? When our dear leaders continually make decisions that are so wrong and so hurtful one has to begin to question their motives.

  4. Is there anywhere in the world that has market based health care? I really would like to know.

  5. Is there anywhere in the world that has market based health care?

    Somalia?

  6. And as Stossel notes, when someone else pays, costs always go up.

    Okay, so once again we’re proving that even if these chum-brains did read Free to Choose, they didn’t pay attention. I seem to recall the Friedmans covered this in detail in there, didn’t they?

  7. Insurance, whether private or a government Ponzi scheme like Medicare…

    Say what you like about the man. The fact that he regularly drops stuff like that into the MSM = respect.

  8. I expect Stossel is right in some important ways, but I would like to see more information and argumentation around the example of countries that supposedly provide publicly funded healthcare for much less money. Great Britain, Sweden, etc.

  9. Stossel lumps “risk-based pricing” for people who smoke and drink with people who have a pre-existing conditions like congenital heart defects. He knows better. We know he knows better. And yet he has no shame about shilling these types of bald-faced fallacies.

    Stossel exemplifies the descent of libertarianism from an erudite political philosophy to a paid priesthood in the service of the finance sector. For decades, the libertarian think-tank cleric-class has shown that it cares more about 2% differences in marginal tax rates than in fundamental civil liberties or limits on the overweening uses of the police power, and it has voted accordingly. We will lose it all in the end, because political-influence money has corrupted the priorities of even the most ostensibly committed libertarian “thinkers.”

  10. In Minnesota, by law, insurance companies must be nonprofits. So how — at least in Minnesota — would ObamaCare reign in the evil insurance profiteers?

  11. For decades, the libertarian think-tank cleric-class has shown that it cares more about 2% differences in marginal tax rates than in fundamental civil liberties or limits on the overweening uses of the police power, and it has voted accordingly.

    So, how’s voting Democrat working out with curbing that “overweening uses of the police power”? Not so good from where I sit. And voting Republican isn’t helping with “fundamental civil liberties”? Big shock. And yet, in your mind, libertarians are the problem?

    Fuck along now.

  12. Red meat for lunch? Delicious.

  13. If insurance companies are allowed to drop me when I get cancer and raise my rates…Then, why should I buy Insurance ?

  14. Is it too much to expect our rulers to understand this?

    Awesome.

    Danny, why shouldn’t Stossel lump smoking and drinking in with congenital heart defects when talking about risk-based pricing? Where is the bald-faced fallacy? They are all increased risk for health insurers.

  15. If once you have cancer, or a stroke, or you get something that makes you UN-INSURABLE unless you are very very very rich…then, there is no point to Health Insurance…That’s what you LIbertarians/Conservatives want…right ?

    This way, once someone gets a heart-attack, or a stroke, or cancer…They should sell everything they have. Hide the money. QUIT THEIR JOB. And go on public assistance (Medicaid).

    This is what happens today…So, why change anything…other than individuals should consider just dropping their insurance and prepare to liquidate everything they have once they get their first stroke.

  16. “the libertarian think-tank cleric-class”

    I swear to god, I’ve donated thousands of dollars to the libertarian cause and I still don’t have my “cleric-class” card. Anybody know what I’m doing wrong?

  17. Doh, I forgot that my default handle was the same as the douche above… sorry.

  18. “I swear to god, I’ve donated thousands of dollars to the libertarian cause and I still don’t have my “cleric-class” card. Anybody know what I’m doing wrong?”

    Have you taken any cleric classes? It is a prerequisite.

  19. This is baloney. I’m in Canaidan and our free health care is great. Why just the other day I had a runny nose and got a house call from four different doctors! So all this stuff about rationing and high wait times and shortages of health care providers is just lame proopaganda hurled out there by capatilist swine. They’re just working to make money anways.

  20. Alice Bowie, no one is suggesting they be allowed to drop you when you get cancer. But raising your rates does not seem unreasonable to me. Now, under a risk-based plan it should also be expected to have a lower starting premium, provided you don’t do something that is known to cause cancer, like smoke. It’s also likely that supplemental insurance would become available if this risk-based idea were to take place. Think AFLAC for health insurance. If you get an “aflac” policy prior to getting cancer and then get cancer that policy could kick in to help you cover increased costs, missed work, etc. Plans like that work because not everyone will get cancer so aflac’s risk is spread throughout it’s customer base and you are protected from hardship. It’s a win-win situation for you and aflac. Now, if you never need it, you’ve paid in and not received anything except piece of mind, which is sometimes worth more than anything…because you COULD get sick. That’s what insurance is all about. You probably have car insurance and may never get into an accident…but you might.

  21. Alice Bowie, no one is suggesting they be allowed to drop you when you get cancer.

    In practice this is exactly what happens. They search through your file looking to disqualify you based on some trumped up clerical error – like failing to disclose a penicillin allergy or something.

    Can someone defend this type of practice from a market based perspective?

  22. Jeez sage run that through your Word spellchecker before posting. I mean at least get your nationality spelled right.

  23. I swear to god, I’ve donated thousands of dollars to the libertarian cause and I still don’t have my “cleric-class” card. Anybody know what I’m doing wrong?

    Check your stats. Maybe you’d be better off trying for a fighter-class card.

  24. I mean at least get your nationality spelled right.

    You’ve never been to Canaida?

    SMACK!

  25. “In practice this is exactly what happens. They search through your file looking to disqualify you based on some trumped up clerical error – like failing to disclose a penicillin allergy or something.

    Can someone defend this type of practice from a market based perspective?”

    I’ll try: If a company did that we’d all know about it. Say Aetna dropped anyone and everyone who ever got cancer. Who then in their right mind would ever by Aetna insurance knowing they would be dropped? No one. BCBS then runs adds saying “Aetna will drop you if you get cancer, we won’t”. Aetna then goes out of business. You say this is what happens, but that doesn’t explain people I know with cancer who haven’t been dropped.

  26. Sure would be nice if there was a credible opposition party in this country.

    Who has developed good arguments against the European models? Why won’t they work here? Do their cost structures work over the long-term? Are they going to blow up like Medicare will?

  27. I think the government run insurance company could minimize costs by having qualified felons run the system. Like Bernie Madoff.

  28. Let me quote Alice:

    “If insurance companies are allowed to drop me when I get cancer and raise my rates…Then, why should I buy Insurance ?”

    and paraphrase Jeff a bit…

    Alice, if all companies dropped you right when you get cancer then all companies are going to suffer a PR nightmare and millions of people asking exactly that question; “Why should I buy insurance if they won’t cover me when I need it?”

    So imagine the first firm that builds its reputation on paying out when you need it! There’s no incentive for everyone to drop you. Further, from a libertarian perspective, if they drop you illegitimately you should have the power to sue for benefits. If you didn’t violate your end of the contract (didn’t lie on your application, etc.), then you have a contract to be insured when something goes wrong and you should be able to sue for that payout.

    Additionally, all the government meddling, as Stossel notes, drives costs up – making it more expensive for you and more expensive for insurance companies to pay for everyone’s care – thus pushing them to drop people. Competition & free enterprise will drive costs down & quality up… as it always does.

    So I’m trying to suggest that if you take a slightly broader view here, you’ll notice that our position is both consistent and more helpful to everyone. Including you.

  29. Jeff,

    Your defense seems to be that you don’t know of anyone who this has happened to, there fore it probably doesn’t happen much, therefore its not a problem. With a kicker of “efficient market” theory tacked on.

    I know people who this has heppened to, and I can assure you it was a problem for them – so from an anecdotal perspective we are at an impasse.

    Usually this happens to people who buy their own, whether because they are self employed or unemployed. People who get their insurance through an employer have the power of group bargaining behind them, but if you are an individual, I can guarantee this is a problem.

    As far as market theorem goes, I will point out that it is not in any insurers self interest to advertise the fact that they will not drop high cost patients or to in fact use this as a business strategy: exactly because these clients are money losers. Why would a company try and attract them as clientel?

    Besides, objectively, the market can be expected to allocate minimal resources to provide care for a life that is unlikely to be sucessful – like much cancer treatment.

  30. “In practice this is exactly what happens. They search through your file looking to disqualify you based on some trumped up clerical error – like failing to disclose a penicillin allergy or something.

    Ok, I’ll give it a shot too. Health insurance should be for emergencies. Just like car insurance, homeowners insurance, unemployment insurance, flood insurance, and every other type of insurance. If health insurance only covered emergencies, compaines would be able to offer cancer policies, or major surgery policies, or customized policies that cover just some things. (Which they are not able to do now).

    Adding to what Jeff said, who would buy a cancer policy from a company with a reputation for dropping people after they get cancer? Maybe people do get dropped now, but that’s only because “major medical” plans distort the market and also make that sort of thing easier to hide.

  31. Danny wields his +3 wand of class envy!

  32. Re: the concern of an insurance company dropping you if you get a catastrophic illness.
    One of the problems with the current system is that many people have company-provided health insurance. They aren’t directly contracting their own insurance. An option in privately contracted insurance would be the ability to add ‘riders’, included a ‘no-drop’ clause. Then if the insurance company drops you, you sue for breach of contract.

  33. I think it’s wrong to treat health care as a commodity. It’s not something anyone ever wants to buy, but are forced into doing so. Even if the patterns of supply and demand led to fair results on regular commodities, certainly they don’t apply to a thing people only buy because they are forced to by circumstances. And those circumstances can differ by hundreds of thousands of dollars depending on the hand you were dealt on health. Health is more important than anything else, including wealth, to most people, so they’re not going to treat that service the same way they treat elective procedures such as plastic surgery or lasik.

  34. So imagine the first firm that builds its reputation on paying out when you need it!

    Yeah until they need to make quarterly earning expectations.

    Further, from a libertarian perspective, if they drop you illegitimately you should have the power to sue for benefits. If you didn’t violate your end of the contract (didn’t lie on your application, etc.)

    Yes, but doing so is out of reach financially for most people, and furthermore – many cases where the dropped party “lied on their application” the “lie” was either an error of omission, or more often completely unrelated to the condition being treated.

  35. Raising your rates based on lifestyle choices is perfectly reasonable. you want to smoke and be obese, feel free. But you should pay more.

    Raising your rates because you were developed cancer, or a heart defect etc is not. It defeats the purpose of insurance.

    Let’s go over basic economics again.

    The purpose of insurance is to pool people with different risks together. IE, high AND low people. Differentiating based on lifestyle is reasonable because it rewards good behavior and keeps overal costs down. Differentiating based on chance is bad because you are delibaretly trying to weed out the high risk people and thus negating the reason for having insurance in the first place. IE to protect yourself against the chance of being high risk.

    Insurance companies ability to increasinly weed out high risk people is one of the things that is putting the whole idea of insurance in jeapordy.

  36. “Usually this happens to people who buy their own, whether because they are self employed or unemployed. People who get their insurance through an employer have the power of group bargaining behind them, but if you are an individual, I can guarantee this is a problem.”

    Another good idea that was torpedoed a while back is to let trade associations or clubs form their own insurance groups. So, if I were a small business owner, I’d join some group that has a deal with an insurance company, and my 10 person business is now part of a 10,000-strong insurance group with leverage just like a big company.

    Of course, this wouldn’t benefit any politicians so the idea was abandoned.

  37. An option in privately contracted insurance would be the ability to add ‘riders’, included a ‘no-drop’ clause. Then if the insurance company drops you, you sue for breach of contract.

    This is not a realistic option. When you go to sign a contract with a company for anything – selling a house, contracting a mobile phone, employment contract – whatever. the company dictates the terms of the contract – you merely accept them or choose another provider. Users do not have the ability to add verbiage, because the rider would then have to be reviewed by the companies cousel: a costly task that would usually be uneconomic from the providers standpoint – they would rather not have that business.

  38. Tony,
    Couldn’t the same thing be said about food? That’s even more important than health care. It’s treated as a commodity and that’s working just fine.

  39. Raising your rates because you were developed cancer, or a heart defect etc is not. It defeats the purpose of insurance.

    What if I have Cardio Myopathy – possibly related to excessive alcohol consumption, but also possibly congenital?

    Moreover, even if you could know the cause of illness with certainty, who gets to decide which conditions are sufficiently sinless to have the government prevent companies from discriminating based on them?

  40. Tony,

    Even if we had a single payer system health care would still be treated as a commodity.

    _______________________________________

    We have the healthcare system we have today largely because the IRS figured out that providing healthcare was an aspect of income; so to deal with that issue all sorts of legal frameworks, etc. were created to make providing healthcare that the dominant way people get their their insurance. For decades reformers have been screaming about the need for portability, and for decades vested interests have ignored this rather simple reform which would solve many of our problems. As far as I can tell the Obama administration has turned a deaf ear to portability.

  41. It is very obvious who is paying Stossel to write. Puts him in the same class a whore.

  42. domoarrigato,

    Actually, no drop clauses would be common in the U.S., but there are a variety of regulatory roadblocks in their way. You could also have resumption of coverage clauses as well; I pay insurance so that I can buy health insurance later on. Insurance could be a heck of a lot more innovative than it is today but for all the mandates, etc. by the government.

  43. Intelligent discussion of issues is appreciated.

    (I just wasted a few minutes of my life reading the comments to that Palin story: more ad hominem drivel that turned me off from H&R during election season.)

    OK, so explain to me why if I get sick and require intensive, expensive professional care that I shouldn’t have to sell my assets to cover the costs?

  44. “As far as market theorem goes, I will point out that it is not in any insurers self interest to advertise the fact that they will not drop high cost patients or to in fact use this as a business strategy: exactly because these clients are money losers. Why would a company try and attract them as clientel?”

    The goal is not to attract those people specifically. The goal is to attract many people (only a small portion of which who would be unprofitable), because of the security of not being droped should they develop something bad. Statistically speaking, insurance is a bad idea for people. If it wasn’t, insurance companies would be losing money hand over fist instead of being viable.

  45. Inigo Carmine,

    Well, more to the point, so much of what the government does actually discourages the healthy from getting health insurance by making insurance less flexible and more expensive than it otherwise would be; that means insurance companies are more necessarily aware of those who are sick and they give coverage too. Mandates and the like have a lot of perverse consequences – including of rent seeking by various service providers, etc.

  46. What if I have Cardio Myopathy – possibly related to excessive alcohol consumption, but also possibly congenital?

    Moreover, even if you could know the cause of illness with certainty, who gets to decide which conditions are sufficiently sinless to have the government prevent companies from discriminating based on them?

    He was saying that it is wrong to raise rates based on the “ends” but the “means”. They should be able to raise rates on is people who smoke because that causes cancer, not because they got cancer. And I would assume doctors could decide what causes illnesses since that is kind of their job.

  47. “I will point out that it is not in any insurers self interest to advertise the fact that they will not drop high cost patients or to in fact use this as a business strategy”

    Yes, except it IS in the interest of every single one of their competitors!

    People often fail to see the other half of the equation with economic issues and health care always seems to be the worst one.

  48. domoarrigato,

    I would probably lean towards not counting pre-exisitng conditions “even” if they developed from lifestylce choices. Because they would already be paying a higher premium based on their lifestyle choices. Moreover, if they changed how they lived, they could then get their premiums reduced.

    The determination if you could get the reduction in premiums would probably be based on your doctors recomendation at your yearly checkup or something similiar.

    Not a perfect system to be sure, but a workable one I think. With the proper mix of incentives it could help keep costs down, and allow people to still get coverage.

  49. Something that just came to mind:

    People for a gov-option are using the defense “What about the individual who is dropped due to condition X?”, and people against it are saying that free markets would be “better for everyone as a whole because rates will go down”. This is an interesting switch of who usually sides with individuality or collectivism in my opinion.

    Basically, pro-gov-option people are worried about themselves individually and if they happen to get cancer whether they will be dropped and more or less left to die. Pro-market people are willing to sacrifice those few who are dropped in the short term to allow those insurance companies to develop a bad name and thus be rejected by the market so that eventually no one will ever be dropped. Intriguing…

  50. Always Hoped I’d die before I got old.

    But I didn’t die. The gummint says I am not capable of determining my own path through this world. My employers got to pay for my health insurance, the emergency rooms had to see me, the drugs got better and I have seen or heard 1.3 million PSAs telling me how to live a clean life.

    Well, thanks for keeping me alive! I spent 50 years smoking, shooting, driving fast, drinking, getting lazy, fat and incontinent, and finally in need of some new organs.

    What do you mean you want me to sell my house to pay for the procedures??? My timeshare in DelBocaVista too??? The horror!

    (thinks for a minute…who is left to blame…)

    Dirty bastard insurance companies!

  51. I’m sorry, I re-read that and didn’t say what I meant quite. If a company drops people inappropriately, it’s in the interest of their competitors to point that out – in order to provide a more reliable, trustworthy product to their potential customers.

    It’s the same thing that banks (prior to the whole FDIC/bailout extravaganza) used to have to do for their clients – you don’t put your money in a bank unless you know that A. it’s going to be physically secure, and B. that they’re not going to loan it out to random strangers and never get it back. If a bank did do that, then other banks wouldn’t waste a minute pointing that out.

    IE:

    “Well gosh, you don’t want to bank with US National down the street – last year they lost 30% of their depositors’ money on bad loans… Our bank however, earned 25c on the dollar for every one of our clients, bank with us instead!”

    Or…

    “Don’t buy insurance from Aetna, they drop their clients at the first sign of an major illness – you’d be throwing your money away, come over to Blue Cross and we guarantee that you will be covered and healthy.”

  52. I will point out that it is not in any insurers self interest to advertise the fact that they will not drop high cost patients or to in fact use this as a business strategy.

    I don’t see why you believe this. While it would draw in more currently high-risk patients and drive up rates, low-risk people would then have the choice between cheap insurance that will drop you if you (more or less a tax) or paying a higher cost to actually be covered. Eventually everyone who isn’t a descendant of God (and can’t get sick) would pick the insurance that actually covers you. I’m not a business major, but I believe more customers is a good business strategy.

  53. Couldn’t the same thing be said about food? That’s even more important than health care. It’s treated as a commodity and that’s working just fine.

    But eating enough to stay alive is much cheaper and more predictable an expense than healthcare. Besides, the only reason there aren’t more people starving in the industrialized world is because of social safety nets that allow the poorest to at least afford food.

  54. What if we treat health insurance kind of like we do for term life insurance. This would be for high deductible plan and could work like this. I buy health insurance for a term of 10,20,30,40, whatever years. When I sign up, I’m given more or less the same questioner/exam I would get with a term life policy. My risk is then based on my health at the time, and the term I’m purchasing for. Short term/low risk = lower premium, higher term/higher risk = higher premium. Like term-life, after the term has passed, I also would have the known monthly payments to continue the policy for as long as I keep the policy, or I’m free to switch. Obviously, if I came down with cancer, where my risk went way up, I’d pretty much be forced to stay with that policy indefinitely – but I’d have insurance – at a known premium.

  55. Peter,

    Well, it is quite imaginable under a government plan that because it rations it will not treat certain types of cancer or cancers that have go past a certain stage of development. In essence, they would be “dropped.” And of course with the absolute hysteria in the U.S. over doctors prescribing too much pain medication, they might not even get adequate pain management.

  56. Actually, no drop clauses would be common in the U.S., but there are a variety of regulatory roadblocks in their way.

    I don’t know of any other type of contracting that allows individual service purchasers to dictate the terms of contract – unless it is from another individual. I still don’t see why this would suddenly be the case for health insurance – even with roadblocks removed.

    You could also have resumption of coverage clauses as well

    You could, but why would a company ever want to offer them?

    Sean W Malone – could you explain more please, im afraid I dont understand your point…

  57. Peter,

    You’re not looking deep enough on the individualism vs. collectivism. Everyone is an individual… From a philosophy standpoint, it’s fundamentally not right to conscript the paid work hours of millions of people to support the lives of anyone else, regardless of the size of group.

    But the economic questions is always about how to get the highest possible quality of life to the greatest number of people. I’m not sure what that has to do with collectivism though, since the whole idea is that transactions happen on a voluntary, non-coercive basis and that individuals are responsible for their own lives… And of course, solid economics supports liberty on a practical level incredibly well.

  58. If a company drops people inappropriately, it’s in the interest of their competitors to point that out – in order to provide a more reliable, trustworthy product to their potential customers.

    I think this reasoning ignores a large part of the equation. Really the only thing optimized by competition is individual companies’ bottom lines. They can achieve that by attracting more customers, but that’s not the only way. They can also achieve it by competing to limit coverage of expensive procedures. Insurance companies don’t just want more subscribers, they want more low-risk subscribers and less high-risk ones because of the nature of insurance.

  59. Tony,

    The reason the poorest aren’t starving to death in the West is due to the incredible productivity in food production in the West. And of course the government does all sorts of things to makes food far more expensive than it should be – such as subsidies for farmers.

    Oh, and they tried government run farming in the Soviet Union; people died with grass in their mouth (that is, they died of starvation; which to be honest, is a hard thing to do – most people who are hungry die of diseases related to their hunger).

  60. If a company drops people inappropriately, it’s in the interest of their competitors to point that out – in order to provide a more reliable, trustworthy product to their potential customers.

    Except that every insurance company does the exact same thing – and would face the same accusation. More to the point: acting in a way that would indemnify them from such negetive press would be disasterous. very simple extension of the idea.

  61. “But eating enough to stay alive is much cheaper and more predictable an expense than healthcare.”

    YES! And guess which the government doesn’t regulate the hell out of, control supply, arbitrarily set prices & wages, or contribute to 60% of the payments?

    Seriously… We really need you to start understanding why the cost is so high. It’s not random.

  62. Domo, you’re missing the point.

    Not every company does do the same thing in a free enterprise system, obviously, and the very pressure from competition with other firms that want people’s business pushes the likelihood of severe problems like that down. It’s one thing to drop people who cheated on their applications, but another to drop them after years of paying in. Any company that did would face severe scrutiny, not only from consumer advocacy groups and individual clients, but also from their competitors.

  63. People just need to die. Really. People were doing that with very little overhead for at least 100,000 years. It’s only over the last 100 years (or 0.1 % of the human timeline) that money has become an issue.

  64. come over to Blue Cross and we guarantee that you will be covered and healthy.

    Market Department meeting:

    Director: So whats this ad campaign about?
    Peon: Well we level accusations of unfair treatment at our competitors and try to steal their clients
    D: like what?
    P: “come over to Blue Cross and we guarantee that you will be covered and healthy.” We will guarantee coverage even if the clients are sick: we will increase market share by 10%
    D: But these are the sickest possible patients – we will lose money on every single one of them!
    P: Don’t worry, we’ll make up the losses with higher volume
    D: You are fired.

  65. domo,

    I don’t know of any other type of contracting that allows individual service purchasers to dictate the terms of contract…

    It would just be another option that one could pay extra for actually; it wouldn’t require any more negotiation than adding extra coverage to your car insurance does. No drop clauses are pretty common outside of the U.S. as far as I know and I think they even exist in some states in the U.S.

    You could, but why would a company ever want to offer them?

    For the revenue. For large segments of the population it would actually be a good deal; and the same would be true for the insurer as well.

  66. Sean,

    Food industries are hardly a bastion of government non-interference. I agree with Seward that many ways the government interferes with food are counterproductive, but every bite of food is more heavily regulated than insurance policies, and fewer people are dead as a result of those regulations. We don’t need the market to eventually put companies that poison people out of business when we know how people get poisoned and we can forbid them from doing it in the first place.

    The notion that healthcare is broken because of the nebulous bogeyman of government meddling is ridiculous for many reasons. The most obvious is that there is better healthcare in countries with nationalized systems. And why is it never framed the other way? I think there is more industry meddling in government than the other way around. That goes for food too.

  67. Not every company does do the same thing in a free enterprise system

    No, I think you are missing the point. Competitive pressure will not force a market to provide a service that is fundementally uneconomic – in fact one of the beauties of the market system is precisely this. Its a feature, not a bug.

    The problem is that we are human, and love our parents, and don’t want to just let people die because too expensive to treat them. We make fundementally uneconomic choices with regard to healthcare.

  68. “I think it’s wrong to treat health care as a commodity.”

    No one gives a fuck.

  69. It’s one thing to drop people who cheated on their applications, but another to drop them after years of paying in. Any company that did would face severe scrutiny, not only from consumer advocacy groups and individual clients, but also from their competitors.

    Except that that is exactly what happens, they’ve been doing it for a long time, and they have been receiving scrutiny for a long time, and yet it happens all the time!

  70. Health care costs are spiraling because the government has fucked up the price mechanism, so people are protected from the costs of their own health care choices, including ridiculous malpractice lawsuits against doctors and hospitals.

    In countries that pay fee-for-service you can get very affordable basic care. Insurance should be reserved solely for serious disasters, not run of the mill procedures like giving birth or annual physicals. I’ve got no problem with insurance rates varying in proportion to a persons risk factors. But the individual should be able to customize his coverage to things he’s actually a high risk for, so he’s not forced to subsidize costs for others. The only way the system can get appropriate price signals to hold down costs is if people do pay in proportion to their overall risk.

    Nobody is stingy with other people’s money. Would you rather ration your own health care, or have someone else ration it for you?

  71. Seward – omitting the subsidies and protectionist measures that make food more expensive than it needs to be (and to some degree keeps international food producers unnecessarily poor by restricting their access to our market for a lot of food… What Tony really needs to grasp is that the more government involvement there is, the higher the costs are to consumers.

    Higher taxes, supply restrictions, trade restrictions, barriers to entry for producers and distortions through 3rd payer/government purchases – i.e. things that medicine experiences probably the worst of in our entire economy – all contribute to increases in cost.

    Compared to medicine, our subsidized, protectionist food production industry is free as a bird.

  72. “I think it’s wrong to treat health care as a commodity.”

    I think it’s wrong to treat puppy dogs and kittens as a commodity.

    Free lollipops for everyone!

  73. Would you rather ration your own health care, or have someone else ration it for you?

    If the choice is externally rationed healthcare versus no healthcare I think 40+ million people in this country would choose the former.

  74. “Except that that is exactly what happens, they’ve been doing it for a long time, and they have been receiving scrutiny for a long time, and yet it happens all the time!”

    AND YET, we don’t have the conditions I established as necessary for the system to function properly!

    In a tightly controlled market, market incentives don’t really apply, now do they??

  75. What Tony really needs to grasp is that the more government involvement there is, the higher the costs are to consumers.

    What I think you need to grasp is that there are costs besides what comes out of your pocket to pay for a good. Paying a little more for a dead chicken so that I’m relatively certain it won’t kill me when I eat it is a good tradeoff. That’s not to say I believe the government should continue to subsidize what is essentially a monopoly on feeding people by the corn and soy industries, but lots of “government interference” reduces individual costs when costs besides market price are factored in.

  76. Tony,

    …but every bite of food is more heavily regulated than insurance policies, and fewer people are dead as a result of those regulations.

    That is just silly. Look, food production in the U.S. is not subject to the multiple layers of state and federal regulation, mandates, etc. that health insurance is. Farming is pretty much left up to the farmer.

    The most obvious is that there is better healthcare in countries with nationalized systems.

    Actually, what has been found is that the U.S. and other nations have roughly similar healthcare outcomes in most areas of treatment (with each country having an advantage in one or two areas). What is so troubling about U.S. healthcare is that is so damn expensive, not it performs so poorly in comparison to other countries. Liberals, conservatives and libertarians broadly agree on this point, BTW.

  77. The problem is that we are human, and love our parents, and don’t want to just let people die because too expensive to treat them. We make fundementally uneconomic choices with regard to healthcare.

    So you would rather let the government kill your parents? I thought the point of government control was to help everyone have better care at a lower price?

  78. Hazel, don’t misuse the word “ration”.

    Buying a service on an open market with the resources at your disposal is not rationing.

    Rationing happens when someone else determines your “allowance” of a good. No one controls the amount of bananas I go buy from the store, and though my wallet and common sense dictate I can’t buy out the whole damn store, I decide for myself based on my myriad competing goals & values.

  79. AND YET, we don’t have the conditions I established as necessary for the system to function properly!

    In a tightly controlled market, market incentives don’t really apply, now do they??

    All true, Mr. Malone. My issue is the fundementally uneconomic nature of treating the very sickest people. The best technologies currently available were made possible by the fact that the money tap for healthcare is jammed open.

    If we had a libertarian system, we would have better, more affordable basic care, but a scarcity of high tech care for unusual diseases. Treatment of common, yet deadly diseases might be a wash, but would be highly regressive in availability. Poor people would not get treatment, most likely.

  80. So you would rather let the government kill your parents? I thought the point of government control was to help everyone have better care at a lower price?

    Peter, don’t mistake my critique of the standard libertarian answer as support for the status quo. I like to examine cases where I think market failure is possible or likely – and healthcare is a prime candidate.

  81. Tony,

    For the most part, poultry producers self-regulate when it comes to poultry safety. And of course they are the ones who have innovated when it came to poultry safety for that matter. Serving bad chicken is terrible for their business and they insure against that by good practices.

  82. “Paying a little more for a dead chicken so that I’m relatively certain it won’t kill me when I eat it is a good tradeoff.”

    OK… If that seems like a good tradeoff to you, fine – I am offended that you think you have the right to decide for everyone else that that is a good tradeoff, and take their money by force to pay for it… BUT regardless, you’ve just stumbled over your own logic.

    Medicine’s high cost is unquestionably because of government.

    Either medicine is too expensive, and needs to come down – or the high cost is necessary for it to be “safe” and is something we Americans will have to live with.

    Which is it going to be?

  83. The problem is that we are human, and love our parents, and don’t want to just let people die because too expensive to treat them. We make fundementally uneconomic choices with regard to healthcare.

    Which is fine. But it’s not fine when you start asking the rest of us to pick up the tab for the $1.2 million dollars it costs to keep someone alive for 3 extra months. Just because you love your parents very much and don’t want them to die means the rest of us should go bankrupt to keep an 80 year old around an extra couple of months.

    I readily admit this is cold and callous, but it’s the fundamental nature of the world. There are not enough healthcare resources to provide everything everybody wants. Why is the government going to do a better job of allocating those resources than the market? It never has in any other field.

  84. We make fundementally uneconomic choices with regard to healthcare.

    I’m wondering if that’s a good reason to follow the nonprofit model. Encourage investment by allowing dividends to be paid, but reinvest profits into R&D, facilities, and providing a safety net.

    I worked at Providence Hospital in Anchorage. They were nonprofit and were constantly buying new machines, etc. Just a thought.

  85. domo,

    I like to examine cases where I think market failure is possible or likely – and healthcare is a prime candidate.

    Since roughly 50% to 60% of U.S. healthcare is paid for directly by the U.S. government, I have trouble seeing our current problems as one of market failure. It is government failure if anything. A lot of that has to do with the ratcheting down of choice by various government measures.

  86. It is government failure if anything.

    To be sure. The question I raise is “would the libertarian system experience market failure”

    I think it very well could – I was hoping to elicidate why.

  87. 50-60% directly, and that’s not mentioning the myriad billions of dollars in various costs it shoves on to the private sector by underpaying for supplies and making private doctors & hospitals do Medicaid’s paperwork.

  88. domo,

    Or let us make this comparison; imagine if half of the funding for I don’t know, door making was made directly by the U.S. government and some large segment of the population couldn’t afford doors, or had to have their employer buy their doors. Would you jump on that as a market failure? Or a government failure?

  89. If the choice is externally rationed healthcare versus no healthcare I think 40+ million people in this country would choose the former.

    BZZZT! False dichotomy. Insurance does not equal health care. Walk into an emergency room anywhere in America with no insurance. They will, and are forced to by law, treat you. The quality may be less than paying customers receive and you may wait a looong time for it, but you’ll get seen.

  90. follow the nonprofit model
    Most hospitals are already non-profits. But non-profits buy and sell services on the market – they are just as subject to market forces as for-profit entities are.

  91. Seward – just because the current system experiences massive failures of many sorts doesn’t mean the libertarian solution wouldn’t also. thought experiment…

  92. “but every bite of food is more heavily regulated than insurance policies”

    No linky, no talky. No linky, no talky.

  93. domo,

    Well, I don’t know what a libertarian system of healthcare coverage would look like, and I really don’t think it is all that important to discuss because that is not what is even remotely possible in the U.S. What is important to discuss IMHO is expanding choice, making health insurance more portable, curbing mandates, etc. All this can be done and the U.S. and state governments would still remain heavily involved in health care and finding ways to cover the uninsured (who aren’t really that much of a problem anyway).

  94. “The most obvious is that there is better healthcare in countries with nationalized systems”

    ibid.

  95. “Paying a little more for a dead chicken so that I’m relatively certain it won’t kill me when I eat it is a good tradeoff.”

    I KILL YOU! I KILL YOU!

  96. T,

    Well, there are also numerous doctors who only take out of pocket patients; and their prices are very reasonable.

    domo,

    What is unfortunate is that we cannot apparently create a system as Switzerland did in the 1990s somewhat from scratch. Because we are such a large nation we’ll end up with more of a hodge podge of various not very well linked together legal regimes, mandates, etc. that will often be at cross purposes. One of the advantages of doing away with the role of the states would be to cut that sort of thing down, but it would lead to all the problems we see with centralization of power.

  97. domo is making a clearer case than I am… Healthcare is not governed by the alleged rationality that governs many other exchanges (I would argue that few exchanges are). And the idea that government interference is always a bad thing is not a fact but a prejudice, no less so because it is dearly held by libertarians.

    Why shouldn’t government be considered a legitimate competitor? So they have unlimited resources they didn’t earn… who cares, except purists? Most people care more about getting the cheapest healthcare than about whether good market sportsmanship is adhered to. The taxes we pay are after all factored into our individual healthcare costs. At least we can vote the parasitic bums out of office if we don’t like it.

    Markets aren’t teleological, but this discussion is. There is no guarantee that markets will deliver universal healthcare that doesn’t bankrupt people or that will provide the outcomes we require but that don’t necessarily live up to a rational market calculus, as domo has explained articulately.

    So your choice is to retreat to a harsh acceptance of more people dying in deference to market fairness, or to do something alien to libertarians: realize some things are more important to most people, and centralization is necessary to achieve those goals, even at the cost of market purity. Nobody is arguing that a free market healthcare system will provide these ends because that’s quite clearly fantasy.

  98. The question I raise is “would the libertarian system experience market failure”

    I guess I would want to know what you would consider a market failure, domo.

  99. I don’t think I can recall a single instance where Tony has actually linked to anything.

    He’s mostly full of unverifiable shit that makes little to no sense and displays his ultimate ignorance. And, as in the last example, often contradicts himself.

    Again – which will it be Tony? Gov’t manipulations make things cost more and it’s worth it cause it keeps us safe or the cost isn’t worth it?

  100. Anyway, one thing is for sure; the problem of healthcare coverage has been “perpetual” for some time now and will continue to be, and that is just an absolute gold mine for politicians. I am just so cynical.

  101. Most people care more about getting the cheapest healthcare than about whether good market sportsmanship is adhered to.

    I can tell you that most sick people are far less concerned with getting the cheapest healthcare than they are with getting the best healthcare.

    And that people with excess money do not, under any circumstances, shop for healthcare based on price, but instead have shown a willingness to pay substantial premiums for both convenience and marginal (at best) increases in perceived quality.

  102. “I readily admit this is cold and callous”

    No it’s not. In many cultures, the old grow a pair and wander off into the woods or bush or where ever and die.

    We are selfish, frightened pussies by comparison.

  103. If the choice is externally rationed healthcare versus no healthcare I think 40+ million people in this country would choose the former.

    Let’s see how many of those 40 million have cell phones, internet access, satellite or cable TV, gas hogs for vehicles, etc. How many of them are people that just have to have new clothes every season? Add up all that stuff and you probably approach if not surpass the cost of an insurance policy. When it’s their own money people prioritize. Why buy it when Uncle Sugar will make someone else pay for it?

  104. I heard many great opinion from all of you concerning what I said.

    This is what I actually meant to ask:

    “What’s the Point of HEALTH INSURANCE if the insurance company will drop me once I’m no longer employed with the company that is paying for me premiums. And, how can I possibly get insurance once I’ve already had a stroke, cancer, or whatever…since this will be viewed as a pre-existing condition.”

    You see, once I have my STROKE, I’m not longer insurable. And, if we continue in this country with employee-sponsored plans…I’m no longer employable.

    What do I do then? And remember, it’s not just me, it’s my wife, and my two daughters.

    The only thing I can see me doing is Committing SUICIDE and let me family collect the death benefit….a $3mm policy that I pay $200 for.

    I’ve made it my business to keep my wife off the house note and we have separate credit cards. I can always run up my credit cards and have them seize the house. And, when I die, my family collects the death benefits and all of my personal DEBT DIES with me.

    This is my plan. I hope I don’t have to exercise it. And, this plan definitely doesn’t work if one of my dependents gets a serious condition that will render us poor.

    My point is that there is NO use for INSURANCE for serious illness where the primary provider is unable to work…WE NEED A PUBLIC PLAN for when this HAPPENS to PEOPLE.

  105. Tony, your system clearly will not provide anything remotely like the “ends” you seek.

    Centralization invariably causes shortages and skyrocketing costs… Further, your sense of “rationality” has no bearing on any markets. The whole point of free price systems is that knowledge is dispersed and prices reflect things like scarcity – government, absent a proper price mechanism, has no way to obtain the knowledge it would need to properly allocate resources….. which is why it’s unsurprising to survey history and find out that they never have!

    Scarcity is a fact of life – in medicine or anything else, and the question of how to use scarce resources can only be answered in a few ways… the one you consistently advocate is clearly a massive failure.

  106. Tony,

    Why shouldn’t government be considered a legitimate competitor?

    Because government actors also make the rules for the game. So, not only is it an actor in the market, it is also the cop for that market. This is the same sort of non-sense that went on with public power in the U.S., and look at how much government actors abused all manner of persons and organizations with that power to both act in the market and regulate it.

  107. “I worked at Providence Hospital in Anchorage.”

    Did you cross the boarder legally? ;0)

  108. what you would consider a market failure

  109. Alice… you obviously didn’t read what I wrote. As I recall, the last time we had this “discussion” you didn’t then either.

    Please attempt to break away from your conception of a world where we (libertarians) are advocating the status quo. We are not, and your false-dichotomies are irritating.

  110. Argh – preview fail…

    http://en.wikipedia.org/wiki/Market_failure

    I think a reasonable definition for healthcare would be a system that systematically resulted in a lower value for human life than society finds acceptable.

  111. And, we already have that plan. It’s called Medicaid. And, in the disability cases, it’s called Medicare.

    Nothing needs to change…We just need to get rid of insurance.

  112. Domo, has there been a “market failure” in any area involving trade that has been more-or-less free to operate without government interference by that definition? Ever?

    Stossel often brings up Lasik eye surgery and various cosmetic procedures that aren’t paid for by government or insurance… Is it a market failure that people can have repaired eyesight at continually cheaper prices with better quality results?

  113. Sean W. Malone ,

    I’m saying that the STATUS-QUO if fine!!!

    The upper class people can pay for any health matter that comes up.

    The poor get medicaid.

    The middle class can use whatever the insurance company is willing to pay for…and when they deny you or drop you…you will become poor before you know it…and you get medicaid.

    NOTHING NEEDS to CHANGE. But we need a PUBLIC PLAN once they’ve seized your life’s savings, your home, and your children’s college fund.

  114. “I don’t think I can recall a single instance where Tony has actually linked to anything.”

    I pressed this useless fuck about that a few weeks ago and the pile of shit stated flat out that he’s too lazy, ergo, that is our job. It’s why I don’t engage him at all. (in the interest of full disclosure, my pet dead chicken gave a shout-out to that lazy, ignorant, useless fuck).

  115. “Nothing needs to change…We just need to get rid of insurance.”

    WTF?

    Because the thing that was originally intended to be used only by the margins of society has completely and utterly taken over the entire system – and as a result fucked up the market entirely and sent costs through the roof… we should… do away with any other option!?

  116. Tony | July 9, 2009, 2:34pm | #

    domo is making a clearer case than I am…

    Whoa – I disagree that I am making your case. Maybe my case is stronger, but….

    So your choice is to retreat to a harsh acceptance of more people dying in deference to market fairness, or to do something alien to libertarians: realize some things are more important to most people, and centralization is necessary to achieve those goals, even at the cost of market purity. Nobody is arguing that a free market healthcare system will provide these ends because that’s quite clearly fantasy.

    Fortunately there are more than two alternatives. Market failures can often be “fixed” by altering the rules of the economic game – this is what the statists like Tony are trying to do. Even if they are right that market failure exists (and I think it does, but I’m not rabid about it) their solution leaves a lot to be desired, and creates as many problems as it fixes.

  117. “At least we can vote the parasitic bums out of office if we don’t like it.”

    It’s much easier to change doctors and insurance companies than it is to vote the bums out of office.

  118. “This is my plan”

    As stated earlier, mine is to simply die.

  119. Is it a market failure that people can have repaired eyesight at continually cheaper prices with better quality results?

    It is wrong to equate results from a single specialized, popular, but elective procedure to economic game called “healthcare” as a whole. You can see how that is the case, right?

  120. To those libertarians/conservatives/others that claim the following:

    …f an insurance company starts dropping people once they get sick…nobody would buy the policy…

    Insurance companies act like oligopolies. I mean, where do u think the “Pre-Existing Condition” thing came from. There will be no place to go…without a public plan….which already exisits.

  121. The only involvement of the government should to give a tax credit for purchase of medical insurance. People who owe less in Income Tax than the credit would get a voucher.

  122. Alice,

    1. Please try to learn the history of the system and recognize why costs are so high – I’ve been trying to explain that half this thread.

    2. Further note that your financial trouble in affording health care – and much of the insurance industry’s decisions about coverage are related to the inflated costs.

    3. My advocacy of free enterprise policies which would actually lead to lower costs means that the system isn’t cannibalizing itself anymore and we wind up with net improvement in the quality of life rather than stagnation/worsening as all our policies (and your insane “recommendation”) are gearing us towards. Lower costs are another way to say “increased supply”, and increased supply is another way to say “more for everybody!”

    High costs are just the opposite.

  123. Talk of “market failure” is bogus. When the market can’t overcome the reality that resources are scarce, people speak of “market failure”, as though there is an infinite source of healthcare services out there that the market has “failed” to find.

    Of course the government can’t find that infinite source either, because it doesn’t exist. Whatever Barack says.

  124. This discussion of health care systems proceeds in an idiom that assumes one alternative or its opposite is best for all concerned. False. There are different winners and losers under different systems. Under a “Stossel” system, the old, sick, and poor would be treated as losers, because providing a high level of care for them is fundamentally uneconomic. The young, healthy and rich would be winners, because they could get such modest care and insurance as they need without having to subsidize their economic inferiors. Under an Obama system, the old, sick and poor would be relative winners, because they would get care that they simply could not command under a “Stossel” system with their weak economic power. The rich, young and healthy would be comparative losers, because they would have to participate in a system that subsidizes the care of their economic inferiors.

  125. Sean W. Malone … I hear and respect what you are saying.

    But, it will take too too long to do everything all over again. There’s no bringing anything back to reasonable prices anymore.

    I don’t want to wait until the health care system is fixed…It is NOT even broken.

    Let’s keep the private plans. We don’t even need government making policy decisions requiring the insurance companies to do anything.

    I’m all for the Free Market.

    But we need a free plan once we loose everything we have…It’s not a good idea to have 10s of thousands of people roaming the streets with contagious diseases and open sores.


  126. This discussion of health care systems proceeds in an idiom that assumes one alternative or its opposite is best for all concerned. False. There are different winners and losers under different systems. Under a “Stossel” system, the old, sick, and poor would be treated as losers, because providing a high level of care for them is fundamentally uneconomic. The young, healthy and rich would be winners, because they could get such modest care and insurance as they need without having to subsidize their economic inferiors. Under an Obama system, the old, sick and poor would be relative winners, because they would get care that they simply could not command under a “Stossel” system with their weak economic power. The rich, young and healthy would be comparative losers, because they would have to participate in a system that subsidizes the care of their economic inferiors.

    Very well put Danny…

    I don’t think the rich in your situation have much to loose … but a couple of bucks that they won’t miss. The old and the poor have their lives to loose…But in our conservative/libertarian society…we don’t have much value for them anyway.

  127. As soon as everyone is covered by a healthcare option paid for or subsidized by tax dollars, every smallest decision about how you live is now a valid public interest.

    You can’t eat that, it causes …
    You can’t drink that, it causes …
    You can’t go there you might get …

    Drop the tax advantages of workplace healthcare and make it illegal to refuse to issue a policy to anyone that will pay for it, subject to some relative cap, like 1.75 x average company premium.

    Total portability and anyone that *really* wants insurance can always get it, or medifuck.

  128. “It is wrong to equate results from a single specialized, popular, but elective procedure to economic game called “healthcare” as a whole. You can see how that is the case, right?”

    Ugh. Domo! Do you honestly believe there’s a coincidence in the FEW areas of treatment not covered by some idiotic government program being cheaper and more effective than the myriad of ones that are??

    Isolate yourself off any industry that’s not government controlled or paid for and review the similarities.

    Market forces WORK man… all the time!! Doesn’t matter if you want to believe in them or not… that’s the beauty of reality being all consistent and “real”.

    Regardless of what anyone believes, high demand and artificially limited supply = high costs and the higher the costs are, the fewer people there are who can afford to buy. Absent government, more firms (seeing the profit in entering a market charging high prices) would join in and compete with the existing suppliers…. thus… raising supply and lowering costs for everyone……. cept, they can’t do that when government puts a thousand barriers in their way.

    Again… I don’t understand it. This stuff really isn’t complicated at all.

    There is no coincidence here.

  129. It’s not a good idea to have 10s of thousands of people roaming the streets with contagious diseases and open sores.

    You might want to tell the people that live here.

  130. “There’s no bringing anything back to reasonable prices anymore.”

    You underestimate how quickly the market can readjust, I think.

    But beyond that, I’m 26 dude… I actually need a functioning market as I plan to live another 50 years!

  131. That was great Sage….Just what we need in NYC…Let’s bring back the RED-LIGHT District

  132. It’s not a good idea to have 10s of thousands of people roaming the streets with contagious diseases and open sores.

    These people don’t believe in externalities. Every man is an island, every cough contained in a bubble of magic.

  133. “Domo, has there been a “market failure” in any area involving trade that has been more-or-less free to operate without government interference by that definition? Ever?”

    I’m not Domo, but I can think of a couple of examples of market failures (meaning a failure of the market to converge to a stable, efficient supply/demand/price equilibrium):

    1. Unregulated commons for scarce goods (e.g. fisheries), which invariably result in excessive demand depleting available supply as prices continuously rise; and
    2. The free market’s inabilty to provide public goods (e.g. GPS), whereby no supply is ever produced to meet demand.

    However, healthcare doesn’t fit into either model.

  134. So by the logic here, no insurance should exist at all, and health care would practically be free. By the article, health insurance should be outlawed. Of course that is the basis for insurance. You pay money to someone who then turns around and takes care of someone else with it. We are already paying for a redistribution system, with shitty benefits, half assed benefits etc. Ever fought with an INS company to get them to pay what they should have in the first place? How many of you actually have to pay monthly health care costs, or are most of you just giving it the old academic arguement?

    “When politicians interfere with free markets, unintended consequences harm everyone,”

    And when they don’t, all those saints in the free market system do all they can to make it fair and equitable for all….oh wait, thats not right, when the government doesn’t put any controls on the market, you get the housing crash, while the people who fucked it up get paid 50 million dollars. I guess the unintended consequences are dickheads not being able to get paid for screwing the pooch.

    Actually I would like Mr Stossel to focus on some other public health care systems, not just the canadian one. Unless they are the only people on the planet that have public health care.

    Ever notice that people always say America leads the way in innovation? Oh, except when it comes to public health care or drug legalization. Then the HC system would suck and everyone would be a drug addict.

  135. Tony is trollicious.

  136. Enjoy Every Sandwich | July 9, 2009, 2:55pm | #

    Talk of “market failure” is bogus.

    The issue is not simply one of scarce resources. As libertarians, we think that each individual ought to be endowed with the same rights to life, property etc. regardless of whether or not we are rich. We get those rights from our very personhood. Call it Natural Law libertarianism. This stems from the idea that human lives are equally valuable, even if their living conditions can’t be.

    The market solution results in some poor people living in shacks, and libertarians rightfully shrug. That’s inevitable, and a necessary result from the freedom needed to provide a robust level of growth to raise everyone standards of living. that’s not failure.

    When the market solution results in a poor person being unable to afford even basic healthcare, and dying from an easily treatable condition – there is a sense that his life is being valued less. I don’t see a libertarian reason for this to be necessary, in fact I think it might be contrary.

    Therefore, I think it’s worth examining if healthcare can be made to value human life with some minimal value within a libertarian system.

  137. Opsmit – every single thing you just said is wrong. Please link to sources or citations for your unfounded ridiculousness.

    KTHXBAI

  138. Alice, all the problems you address can be resolved with high deductible low premium catastrophic plans. They would be easily affordable where you wouldn’t have to worry about getting your insurance through your job. There are other solutions besides government plans that drive up costs and create rationing.

  139. I pressed this useless fuck about that a few weeks ago and the pile of shit stated flat out that he’s too lazy, ergo, that is our job. It’s why I don’t engage him at all. (in the interest of full disclosure, my pet dead chicken gave a shout-out to that lazy, ignorant, useless fuck).

    I don’t link to facts that are easily googleable. Of all the rubes here who do nothing but regurgitate libertarian axioms, you’re one of the most robotic, so don’t talk to me about lazy.

  140. “These people don’t believe in externalities. Every man is an island, every cough contained in a bubble of magic.”

    STFU, Tony.

    At least LoneWacko provides links. Ergo, Tony is less that LoneWacko.

  141. “when the government doesn’t put any controls on the market, you get the housing crash”

    The government was the cause of the housing crash by encouraging lending companies and banks to make loans to risky home buyers by absorbing those bad loans through Fannie Mae and Feddie Mac. The free market had nothing to do with that.

  142. For a while at least, I am changing my name to:

    One Of Tony’s Reason Rubes

  143. So what’s this Google I keep hearing about?

  144. “you’re one of the most robotic, so don’t talk to me about lazy.”

    [citation needed]

    Stupid fuck.

  145. “oh wait, thats not right, when the government doesn’t put any controls on the market, you get the housing crash”

    You dolt, every damn bit of the current financial crisis was caused BY government intervention!!

    Jesus. It’s insulting that that’s not common knowledge.

  146. all the problems Alice Bowie addresses can be resolved with high deductible low premium catastrophic plans.

    We have that today…It’s called Health Insurance. And, the low premium is $1,500 per month. The High Deductible is my home, savings account, college fund, etc.

  147. It’s not a good idea to have 10s of thousands of people roaming the streets with contagious diseases and open sores.

    Network effects are often associated with market failure.

    Ugh. Domo! Do you honestly believe there’s a coincidence in the FEW areas of treatment not covered by some idiotic government program being cheaper and more effective than the myriad of ones that are??

    Do you believe it is a coincidence that these few areas are elective treatments, where purchasers don’t need them to stay alive?

  148. Getting back on topic, I recently had an issue with my knee that required an MRI. However, in order to get an MRI, I had to get an x-ray first (even thought the doctor new nothing would show up). So after the x-rays showed nothing, I was approved for MRI. So at the end of the day, I had a costly procedure that was unnecessary. Heres a second story, A friend of mine is Chief Marketing Officer for a major insurance company. They were marketing health insurance to recent college grads that were not yet working (or uninsured) and no longer able to be on their parents policies. Since NY State regulations were so stringent on what needs to be covered, they could not write any policies in NYS. So basically, instead of having affordable insurance, they had to make a choice for more expensive plans for coverages they didn’t need, or have no insurance at all.

  149. Russ:

    I struggle to find either of your examples “market failures”…

    First, the tragedy of the commons is explicitly a failure not of the market, but of property rights. In cases like fishing, property rights are just as easily enforced (especially now) on the water as they are on land and each fisherman would then necessarily need to keep track of their supply as does anyone who owns any man-made fishery.

    Second, GPS is but one means of having a successful navigation system, and there’s 2 thoughts I had immediately about that. 1. The market is what produced GPS that is functional for everyone, and what made it so cost effective that virtually everyone I know in LA has a Garmin or a TomTom in their car… and 2. Could definitely have been developed in other ways, but little things like “space flight” have been strictly controlled by terrified governments around the world.

  150. “Do you believe it is a coincidence that these few areas are elective treatments, where purchasers don’t need them to stay alive?”

    No… in that I don’t believe that “non-essential” medical treatments are the only ones allowed to be free from excessive intervention. But the idea that there’s some difference between the way markets operate for “elective” treatments and “non-elective” ones (which is a shady distinction that changes as technology develops anyway) is absurd!

    Food is “non-elective”, yet a fraction of a percent of Americans starve to death.

    Again, there is no difference between medicine and any other good. Supply & demand issues that govern every other scarce good operate just the same.

  151. ack… “No… in that I don’t believe [that it’s coincidental] that “non-essential” medical treatments

  152. Sean,

    The point is to engineer the system in such a way that medicine is not a scarcity. The goal is universal access to life-saving medicine. If the market can’t deliver that (and it hasn’t), then it’s time to intervene. You want medical treatment to remain a scarcity out of deference to free-market fundamentalist purity. What’s great about being a non-libertarian liberal is that you can have concerns besides that.

  153. I think a reasonable definition for healthcare would be a system that systematically resulted in a lower value for human life than society finds acceptable.

    Hmm. Tough to know how to determine if the healthcare delivered by a given market would meet or fail that test.

    Therefore, I think it’s worth examining if healthcare can be made to value human life with some minimal value within a libertarian system.

    I think the rub here may be, who decides what is the “minimal value”, and what is done with that information?

    In a strict(ish) libertarian system, each person decides the value of their own life, and consequently the amount they are willing to spend on healthcare for themselves.

    Each person is also free to decide on the value of other’s lives, at least for the purpose of determining how much they want to contribute to the healthcare of others.

    If I believe that my fellows aren’t placing enough value on the lives of complete strangers, and should be contributing more to their healthcare, I am free to convince them to do so.

    I think you can determine the societal consensus on what the life of a complete stranger is worth, as measured by the health care provided that person, by looking at how much the society voluntarily contributes to providing health care for the indigent.

  154. What’s great about being a non-libertarian liberal is that you can have concerns besides that.

    What get’s me is how mean-spirited people in not wanting to contribute for the better of other people.

    I’m an agnostic. I can only imagine that the TRUE PURITAN Libertarians/Conservatives must be Atheist deep deep down inside and don’t give a shit about anyone.

    I must say, it’s a luxury being conservative/libertarian. You must have so so much health and resources that there is NO NEED for anyone to help them, or anyone else for that matter.

  155. fun one, guys gotta go do some actual work today.

  156. “The point is to engineer the system in such a way that medicine is not a scarcity. The goal is universal access to life-saving medicine. If the market can’t deliver that (and it hasn’t), then it’s time to intervene. You want medical treatment to remain a scarcity out of deference to free-market fundamentalist purity. What’s great about being a non-libertarian liberal is that you can have concerns besides that.”

    You sir, are a moron of the highest order. I don’t “want” medicine to be scarce… IT IS scarce because we live in a finite (read: non magical) fucking world!

    And your magical savior government has BEEN intervening for 40 years! Again, not-coincidentally, the same 40 years that things have gone to shit. If you want less scarcity, then let the goddamn market work. That’s what markets do! Didn’t I explain all this clearly enough?

    Government has been actively limiting the supply of both medicine & doctors, it’s been contributing to skyrocketing costs and then as a special jab to the tits, it limits the ability of any competitor to join up. ALL of this contributes to shortages and increasing scarcity!!!

    Every single damn thing you’ve advocated my entire experience with you has been a policy that pushes production down a fucking pit with spikes in it and leaves it to rot.

    We share the same goal where everyone gets access to life-saving medicine… only in my world, it doesn’t happen by fucking magic, Tony.

    PS, go back and check the link I posted in reference to you – remember that one? It’s a 8-page history of regulation and market intervention in health care since the 40s… Complete with a bibliography and everything. I know you’re not used to actual research, but perhaps you should learn what you’re talking about before you waste any more of my time.

  157. Tony, if the market is failing why did health care inflation become decoupled from overall inflation only after the government started meddling? You can’t blame a free market because we do not have one.

    Stossel is right and you statists are lying about what you want and lying about what other people want.

    1) No one is uninsurable. Period. Insurance is just gambling and if you wager enough someone will take the bet.

    Few libertarians expect policy that doesn’t help people who fall between the cracks. We just want to make sure the money we do spend causes the least inflation possible and is spent as efficiently as possible (which is the exact same thing). This means re-introducing competition, which means individual choice.

    This means something like HSA’s, and for those that need it, subsidized HSA’s. If you have to give people money the least destructive way to do so is just give it to them. If they don’t spend it.. well they keep it. Anything else is inflationary. If I give you money and say you have to spend it, now, or this year, or lose it, you will spend it. And so people do. If I give you ‘free’ care you will use it. This is all inflationary. It’s what we’ve been doing and it’s obviously screwed up HC costs since FDR started us on this path.

    There are ways to fix health care costs that don’t involve authoritarian control. In fact it’s the control that control keeps causing costs to go up.

    But you don’t want to fix anything. You want the control.

  158. “Actually I would like Mr Stossel to focus on some other public health care systems, not just the canadian one. Unless they are the only people on the planet that have public health care.”

    So you think there are no problems in other socialized medicine systems, Obsmit?

    The system in Massachusetts is already having problems. Because of the increased number of insured, patients are struggling to find primary care doctors and the average waiting time for routine office visits has increased. When you increase the demand for services, you decrease the supply.

    More than one million Britons in need of medical care are currently waiting for hospital admission. Another 200,000 are waiting to get on a waiting list. Each year, Britain’s National Health Service cancels around 100,000 operations.

    According to Britain’s Malnutrition Advisory Group, up to 40% of NHS patients are undernourished while in the hospital.

    Sweden’s waiting lists have led some patients to visit veterinarians. “Mr. Johansen, you’re third in line after Fido and Puff.”

    Swedish patients in need of heart surgery are often forced to wait as long as 25 weeks.

    Every European government rations drugs to save money. Eighty-five new drugs hit US pharmacy shelves between 1998 and 2002. During that same time period, only 44 of those drugs were launched in Europe.

    European governments also control costs by paying doctors far less than what they would earn in a free market. On average, US physicians take home close to $300,000 each year. However in Italy the average doctor earns $81,414. In Germany, the average physician salary drops to just $56,455, and in France the salary is $55,000.

    Today, the US leads the world in treating cancer. With breast cancer, for instance, the survival rate after five years among American women is 83.9%. For women in Britain, it’s just 69.7%. For men with prostrate cancer, the survival rate is 91.9% here, yet 73.7% in France, and 51.1% in Britain. American men and women are more than 35% more likely to survive colon cancer than the British counterparts.

    Much of this success is due to cancer screening, in which the US leads the world.

    Today, the US is far and away the world’s leader in medical research and development. America produces more than half of the $175 billion of health care technology products purchased globally. And US governmental outlays on medical research also dramatically outpace those of other nations.

    In 2004, the federal government funded medical research to the tune of $18.4 billion. By contrast the European Union – which has a significantly larger population than the US – allocated funds equal to just $3.7 billion for medical research.

    Between 1999 and 2005, the US was responsible for 71% of the sales of new pharmaceuticals. The next two largest pharmaceutical markets – Japan and Germany – account for just 4% each.

  159. Alice,

    I think you have it completely backwards. All the libertarians I’ve ever met, including – if I might – myself, care vastly more about people’s real well-being than anyone else. The difference is we don’t pretend that magical wishing and emotional hand holding are legitimate solutions to anything.

    Everyone has a choice to sit there and whine about the world and think that if only the “right people” were in charge and if only there was more “love” and less “greed”, things would be better – or you can drop all the emotional bullshit and start using logic and real-world observations to see what works!

    And in this case, as with most others, what works is liberty.

    It’s not magic, it’s not coincidence, and it’s not divine intervention that has allowed America to spend a good deal of its history on top of the world in every measurable way. It’s not a coincidence that whenever other nations allow people more freedom in their personal interactions & trading relationships the results are always lower cost of living, higher living standards, more choices and less poverty.

    Frankly, anyone – like Tony – who claims to “care” so much about everyone else, who is dumb enough to think that some wishful thinking, magical planning and massive abuses of force against other parts of the population is going to produce a better society is not only ignorant and wrong, but they are actively contributing to human misery.

    So… Fuck all the bullshit “talk” of wanting everyone to be happy and safe and have health care. I don’t care what kind of emotional nonsense you come up with in arguing one position or another – if it doesn’t conform to reality, then you’re wasting your time. I want to see costs come down for everyone – including myself as I am no rich guy at all… I work in the entertainment industry for godsake… There is one proven way to increase quality and reduce cost – and that is free enterprise and competition.

  160. Every single damn thing you’ve advocated my entire experience with you has been a policy that pushes production down a fucking pit with spikes in it and leaves it to rot.

    Sean, I think it’s pretty safe to conclude by now this is not an unintended side-effect, is the exact goal of Tony and his ilk.

    Health care inflation could be recoupled with overall inflation and we could take care of the unfortunate. It would cost but it would only cost a linear (or near linear) amount more. Helping people need not make overall costs go up for everyone. I think most of us would be willing to pay this or at least not fight it too much.

    But Tony and his fascist ilk don’t give a crap about the ‘disadvantaged’. He wants to create more disadvantaged. That’s why they only promote schemes that cause prices to skyrocket and increasing scarcity. Which are of course, the same thing.

  161. Alice,

    A couple here have admitted that they’d rather live in a society where more poor people die, because well, that’s life, and we can’t offend the free market gods, at any cost. But most are disingenuous as usual, peddling falsehoods and fairy tales that justify their beliefs. Philosophically, libertarians must absolutely fear universal healthcare. A new government system that actually produces a net benefit for all people? That might give people ideas…

  162. Of FFS Tony – for once in your life LINK to a goddamn source when you open your mouth.

    The government system you advocate produces a net loss and that’s more than clearly visible ALREADY. When you have 100% government control over health care and more people fall through “the cracks” (which are now gaping chasms), and we’ve stagnated to a point where we produce absolutely NO innovation and our hospitals look like Cuba’s… are you still going to come around blaming supporters of free markets… Fucking… Libertarians haven’t garnered more than 5% of the vote in any election ever and you think we’re a large enough population to derail your massive utopian vision??

    Christ Tony you are retarded. And your position is the one that’s been in play for 40 years in health care already… and yet you pretend that we have a “Free Market” because reality doesn’t conform to what you thought it would be.

    If this were 1963, you’d be all up Medicaid’s ass telling us all how great it would be and how it would stop all problems because now the poorest of the poor can get medical care in America that they couldn’t afford before… And now that it’s taken over the majority of health care in America, and it has only produced more problems and increasingly crushed producers of health care innovations, you aren’t even capable of making the connection that you got what you asked for and what you wanted was a disaster.

  163. The point is to engineer the system in such a way that medicine is not a scarcity.

    Sean already kicked you in the teeth on this one, but I just can’t help but pile on. This is the dumbest thing I have read on the internet lately, including my time at 4chan, Fark, and b3ta. Removing scarcity is another way of saying “an infinite supply” and that just isn’t possible. Crawl back under your bridge. You’re either a troll or too stupid to be allowed in public without restraint.

  164. “A new government system that actually produces a net benefit for all people?”

    It doesn’t benefit all people. It makes all people worse off by creating a shortage of health care for everybody. But this is all that matters to leftists, just so we’re all equal even if we’re all equal at a lesser level.

    Regarding poor people dying, they get emergency care in our current system, so there is no need for people to die for lack of medical care.

  165. Sean,

    It’s easy to blame everything on government meddling since there is no truly free market counterexample to refer to, despite you saying it’s proven. (Which is it guys, have we always had a meddlesome government standing in the way of the magic of the market, or is market magic proven by historical data? Can’t be both, seems to me.)

    Perhaps healthcare has gotten to a tipping point over the last 40 years because poverty has been increasing. Wages have stagnated for most people despite an increase in productivity and it’s not because of government interference, but because of the Ayn Rand acolytes in the neoliberal power structure of the past decades doing their damnedest to hand as much power as possible to people who move money around for a living. If wealth were more equitably distributed a lot of the expensive problems of healthcare (and many other things) would be less expensive.

  166. Funny thing is Tony, that I’ve mentioned several times that I’m OK with a FREE Market for Health Insurance.

    People should be free to purchase it…or not purchase it.

    I’m saying that we need a PUBLIC system (Like Medicare and Medicaid).

    I don’t think we need Obama, or the government to do anything. The way it is … is fine.

    – The Rich Pay for whatever they want.
    – The Poor get the lousy Medicaid plan and the 10 hour wait in the emergency room.
    – And, the middle class just needs to be patient and wait until they are Poor to get the medicaid once all of their life savings is exhausted.

  167. As more and more people loose their jobs. And, as more jobs get shipped to other countries that don’t have those pesky environmental and working regulations. And, as more and more people, like myself, end up having little (if not nothing) to loose…since the funds have been clobbered and property values continue to slip. Less people will buy Health Insurance.

    The Moral of the Story: Keep ALL of your Assets Liquid. Don’t pay off that house. Hock it to 100% of it’s current value if possible. Keep all your Assets Liquid…

    Once you are informed of you in-operable brain tumor, lymphoma, heart disease, etc. Liquidate…Put the money in the mattress. Ask for Welfare and Food Stamps.

    Then, and only then, will people really see reality.

  168. “It’s easy to blame everything on government meddling since there is no truly free market counterexample to refer to, despite you saying it’s proven.”

    No Tony – this one’s easy.

    You’ve got government domination of the health care system in the US. 60% in direct payments, regulations on all aspects of production and they even control the number of doctors through both setting licensing quotas and being the primary payer for medical school tuition. It was government intervention that tied insurance to employment through tax incentives & regulations, it was government that created HMOs with 1973’s HMO Act… It goes on and on. I will relink you to the HISTORY OF INTERVENTION even, since your dumb ass couldn’t be fucked to read it the first time…

    I’m sorry Tony, but Government intervention is the only thing on which to blame the currently declining state of American health care. We are so far past the point where any legitimate market forces have any play in this game at all.

    And yeah, I can point to a hundred examples of where market liberalization has made people’s lives better directly, brought down costs and as a result allowed more and greater access to highly-needed goods and services. I can point to zero examples of government intervention and authoritarianism producing the same result.

  169. Bookworm said: “It makes all people worse off by creating a shortage of health care for everybody.”

    This is the fallacy upon which all libertarian dogma levitates above reality. If they had to actually acknowledge complexity — like the fact that all systems have net winners and losers and no one system benefits every single individual above all others — their entire mental construct would collapse in a cloud of dust. Take health care: some people would benefit most from a purely private system; some from a purely universal system; and, in all likelihood, some voting plurality benefits most from our current mixed system. If change comes, it will come because some preponderant aggregation of voters conclude that they would benefit from a change to a more universal system (probably). This notion of a liberty-pure utopia that would benefit each of us, every one and all, if only we would shed our paternalistic illusions and embrace it … well, it currently commands about as much broad public respect as it deserves.

  170. “Philosophically, libertarians must absolutely fear universal healthcare. A new government system that actually produces a net benefit for all people? That might give people ideas.”

    So if I can point to another system that calls itself “universal health care” and can find an instance where someone didn’t get health care, will you admit the term itself is completely bogus and simply a marketing term to convince others the care is “universal”? You think George Bush and republicans can control the health care system adequately, cause you do realize noble democrats won’t be in power forever, these things are cyclical. A good rule of thumb to is give the government as much power as you would when the party you loathe is in power. The term universal heath care is a bogus term, so it would not be disingenuous to point to one anecdotal situation to refute the concept.

  171. “I can point to a hundred examples of where market liberalization has made people’s lives better directly, brought down costs and as a result allowed more and greater access to highly-needed goods and services.”

    Just one or two would be nice. (non-snark)

  172. And for the record, I don’t even need a pure free market example with which to counter all the idiocy, Tony – just like you don’t need a “pure” authoritarian state to know what the results would be. To quote Friedman:

    “In the only cases in which the masses have escaped from the kind of grinding poverty you’re talking about – the only cases in recorded history, is where they have had capitalism and largely free trade… The record of history is absolutely crystal clear.”

  173. Sean,

    Would you be happy if there was NO government help whatsoever and everyone just paid for whatever treatment they needed? And those who couldn’t afford kemo-therapy would just go without.

    Is this the libertarian way?

    I think it is. It’s the only message i hear from you guys loud and clear.
    STOP taxing the Masses. Let them keep their money. Let people pay their own way…without anyone’s help.

    Can you, as a libertarian, deny the bolded statement above?

  174. Sean,

    What on earth makes you think the logical extension of liberal beliefs is authoritarianism? Are you too dense to understand that authoritarianism is the complete antithesis of liberalism?

    I despise authoritarianism in all its forms, including the plutocracies that libertarian policies inevitably lead to.

  175. “What get’s me is how mean-spirited people in not wanting to contribute for the better of other people.”

    The government forcibly taking money from some to give to others is not charity, it’s theft. We libertarians are also concerned about the needy, but we believe they should be helped through charity, not government coercion. Insurance should be a private voluntary thing, not forced on us through government. As a compromising libertarian, I have nothing against a voucher program for the poor. When the poor are allowed to keep what they don’t spend of the vouchers, they have the incentive to shop around for their medical care. I would like to see more states allow high deductible catastrophic policies. These are more affordable policies for those who would make more money than to qualify for vouchers. These are just a couple of alternatives to socialized medicine, but big government people like Obama don’t even want to consider them because it’s all about big government control for them.

  176. “I despise authoritarianism in all its forms, including the plutocracies that libertarian policies inevitably lead to.”

    Tell us Tony, how do libertarian policies inevitably lead to plutocracy?

  177. I’m not Domo, but I can think of a couple of examples of market failures (meaning a failure of the market to converge to a stable, efficient supply/demand/price equilibrium):

    1. Unregulated commons for scarce goods (e.g. fisheries), which invariably result in excessive demand depleting available supply as prices continuously rise; and

    Thought of something. This is the same failure mode that healthcare exhibits. Putting a third party in charge of paying for a transaction between two people over scarce goods effectively makes that good a “common” – the tragedy is that rising prices puts access out of reach for people who cant find a third party to pay. BUT – it also incentivizes excessive R&D (excessive in the sense that much of it would probably not occur in a system where people had limited money to spend)

    So, We have a better standard of healthcare available to the top than we “ought” to have as result of open-ended subsidization – and less equal access to that same healthcare.

    There is probably NO sustainable system that will allow the current pace of medical advances to continue.

  178. STOP taxing the Masses. Let them keep their money. Let people pay their own way…without anyone’s help.

    Close, but not quite. In a hard-core libertarian society, anyone would be free to offer whatever help they wanted, and to accept whatever help they were willing to accept.

    “I can point to a hundred examples of where market liberalization has made people’s lives better directly, brought down costs and as a result allowed more and greater access to highly-needed goods and services.”

    Airline and telephone deregulation.

  179. What get’s me is how mean-spirited people in not wanting to contribute for the better of other people.

    What gets me is how mean-spirited people are who don’t want to give more of their own for the needy, but instead want to take some of mine for the needy.

  180. What on earth makes you think the logical extension of liberal beliefs is authoritarianism?

    Because the policies espoused by liberals (current terminology) lead to centralization of control of society in the state, that’s why.

  181. bookworm,

    Look at half of south america, and the united states over the last couple decades. Maybe I’m conflating libertarian principles with predatory corporate activity, but in the absence of a strong government what’s to stop the latter from being the norm?

  182. @One Of Tony’s Reason Rubes | July 9, 2009, 4:47pm | #

    The message board doesn’t allow more than 5 links per post, so here’s five.

    1.

  183. Shit… #1 is:
    India compared to itself – there’s even a derogatory joke referring to the “india rate of growth” under socialism… Meaning – pre-liberalization their “growth” was non-existent or negative, thus contributing to the images of poverty we all know so well.

  184. 5. Lastly, a fun one… Adjusted for inflation to 2008 dollars, a Black & White TV would have cost you $2212.20… For less than that today (http://www.amazon.com/exec/obidos/ASIN/B001VKY7WU/associatizer-20/ you can have a 1080p 52″ LCD HDTV – courtesy of a market that’s remained largely free of government tampering, and even the consumer standards are set privately and safety is tested by the Underwriter’s Laboratory – a private organization as well…

    GAH… sorry for the massive preview fail.

  185. I part with many libertarians because I believe we have a duty to provide a health care safety net for limited periods of time. And I’ve argued that in the past. And the other person always said, “yeah, but where does it stop? How big of a safety net? How limited of a time frame?” Naturally, I always said “slippery slope” and all that stuff. It now appears that the slope was, in fact, very slippery, and limited safety nets have turned into “let’s insure everybody forever.”

    I was convinced after I lived in Spain that nobody in the US would ever want that system. But if there’s one thing I excel at, it is misreading the American people.

  186. Alice:

    “And those who couldn’t afford kemo-therapy would just go without.” is more or less correct…. EXCEPT……… there are dozens of other options available to you – free clinics, donations from family & friends or from office pools and employers, insurance (why you still refuse to see the value in risk pooling is beyond me, but I certainly don’t), private charities…

    The idea here is that it gets paid but no one is forced to pay.

    And umm… Tony, “liberalism” in the modern parlance is virtually authoritarian as it is – to say nothing of it leading inevitably there. Since you think government is the solution to all problems, and your brain has a disconnect preventing you from recognizing that government is nothing but the societally-sanctioned initiation of force against some people to the “benefit” of some others, you’re halfway there already.

  187. Sean,

    Comparing TVs to healthcare is to basically admit you’re being dishonest. There are few better examples of the market working how you think it’s supposed to work than TVs. Nobody is saying market competition doesn’t innovate and reduce costs over time. But TVs are not a necessity, and they are bought in absolute freedom. Healthcare is something nobody would buy if they had a choice. It’s just an expensive necessity that functions best when the costs are collectively shared, like firefighting protection.

  188. Sean,

    I don’t think the government is the solution to all problems. The only one being dogmatic here is you, who assumes that government always fucks everything up.

  189. Firefighting protections functioned just fine 100% privately dude. Learn your history…

    And you may have noticed TV’s was “a fun one” to illustrate the point that markets make things better *AND* cheaper… I’ve tried to explain why, the principles involved aren’t very complicated actually – but they work damn well… which is why I provided 4 other much broader examples of India, Estonia, Hong Kong and the price control of oil which led to exactly what any half-intelligent human with a basic knowledge of economics would predict… shortages.

    It’s for the same reasons that the price controls & barriers to entry have caused shortages of things like Flu Vaccines – which I did a review on a few weeks ago, noting that since the 60s and Medicaid has expanded into a $400 billion a year behemoth, we’ve gone from 26 manufacturers of flu vaccines down to 2… AGAIN. Not. Fucking. Coincidental.

  190. And it’s time for me to go… I may check in this evening.

    Tony – thanks for being my knife-sharpener.

  191. I work for a private corporation. My health coverage comes in the form of whatever the insurance company we do business with decides it should be, which I shell out hundreds of dollars a month for. The only bureaucrats breathing down my neck are employees of that insurance company as well as my HR person who has said to my face “my job is to protect [the insurance company].” The only people who like this system is the insurance company. I don’t like it, and my company doesn’t like it. In competing for my labor they offer it as a benefit, but let’s see how long that lasts as jobs increasingly enter a seller’s market.

    Government interference is not truly the problem here. It is absurd to continue to make that claim in the face of the reality that we have one of the least effective healthcare systems in the industrialized world despite it being the least intertwined with government.

  192. Today I feel sick. I’m not going to go to the doctor, because, normally, these things pass in a day or two. This happens to me very frequently, but every time I go to the doctor, they shrug and give me antibiotics. Not very helpful for a viral infection.

    After surgery a few years ago, I was prescribed pain-killers. I didn’t fill the prescription, because the pain was actually sending very important informational signals to my body. “Don’t move that way. That part of your body is trying to heal.”

    So, yes, Tony. I have absolutely no free will. If I’m sick, I absolutely positively have to take the prescribed medication. I must go to the doctor at the slightest hint of sniffles. If offered a choice, I’m not capable of choosing between two alternate treatments. All of my medical costs are completely compulsory, and there is no conceivable way for me to shop around or weigh my options. My brain is a bowl of tapioca pudding, and I need President Obama to save me.

  193. And WTF is the deal with Alice not knowing the difference between “loose” and “lose?” Or her referring to “chemotherapy” as “kemotherapy?” Is she joking, or is she really the stupendous dimwit that she appears to be?

  194. JW – s/he really is that dim. I am embarrassed that people here continue to engage him/her.

    Ditto for Tony.

  195. Actually it’s been proven time and time again that government’s and monopolies (ie things without compeitition) become bureacratic (sp) and deliver low quality high costs goods/services.

    Why???

    Because people in general are lazy and self interested. Without the carrot and stick of competition/reward they will do as little as they can get away with.

    In certain cases, the inefficenies of government is worth it. IE our military costs way more than it should, but it’s a tradeoff we are willing to accept.

    Make no mistake ALL socialized medicine systems save money by rationing. Of course maybe enough people don’t mind giving the government that power. But you can’t change the fact of what’s occuring.

  196. JW Gacy,

    What’s with the strawman? Did I say “absolutely no free will”? Care to compare the amount of free will you have with healthcare as you do with buying a TV? Furthermore, how much free will did you give all those boys you raped and murdered?

  197. Strawman? Please, Tony. I merely attempted to emulate the sort of faulty thinking that would lead someone to say, “[h]ealthcare is something nobody would buy if they had a choice.”

    Not every medical condition is life threatening. Sometimes we seek treatment simply to improve our quality of life. So, we do have a choice in many cases.

    And, before you move on to the next step in this ridiculous dance, let me just say, I know you already knew that. You just didn’t allow that fact to dent your reality. Thinking through your argument for you isn’t a strawman fallacy.

    And leave my extracurriculars out of this.

  198. buddy of mine read this via my F/b page. He took it as a ringing endorsement for socialized medicine.

    Sigh…

  199. Wait a second? They (the government-option advocates) say that people who smoke, fat people and people who generally incur more cost will not be charged more for the gov’t healthcare. However, these same people also want to tax soda and cigarettes more to cover the costs so they are charging these people more.

  200. Another example: I have a lipoma on my back. It’s about the size of a silver dollar, and it’s perfectly harmless. But it can cause discomfort and it frightens small children. Should its removal be paid for by magic-fairy government? Or should that claim be denied on the basis that the money might be better put to use treating influenza among the elderly?

    Remember, my medical choices are now political decisions, so everyone gets a vote. What do you think, Tony? Is it acceptable for me to get my tumor removed?

  201. Bingo, Head Tater. We’ve transitioned 60% of our health care system to the public sector, but we’re still supposed to pretend that we still have a free market. But the fact that we’ve turned health care into a public service is then used further against us as a reason why even more aspects of our lives should be subject to government scrutiny and regulation — e.g., our recreational and dietary habits. And, as Tony has dutifully informed us, this is how we combat authoritarianism.

    Freedom is slavery.

  202. Frighens small children you say? Well then if it’s for “the childre” it should be removed, lol

    No expense is to great, or freedom that can’t be infringed as long as it’s for the children!

  203. It’s easy to blame everything on government meddling since there is no truly free market counterexample to refer to, despite you saying it’s proven.

    Ahh.. the old false dichotomy. The logical bankruptcy of the fascist never ceases to delight me. But it is nice to see something other than ad homs, ad pops, and an army of straw men.

    Correct there are no completely free markets but there is no spherical frictionless chicken.

    Nevertheless, more free markets are easily shown to be correlated with increased standard of living.

    (Which is it guys, have we always had a meddlesome government standing in the way of the magic of the market, or is market magic proven by historical data? Can’t be both, seems to me.)

    Hehe just lovely. ‘Can’t be both’, lol:) If it’s not scarlet.. it must be azure! You’re a riot:)

    Perhaps healthcare has gotten to a tipping point over the last 40 years because poverty has been increasing.

    Oh has it? Do you mean to assert that since we’ve embarked on the ‘war on poverty’ and spent trillions to this end.. things have gotten worse?

    How could this be?!

    Well rather, how could this be from the perspective of an economic illiterate?

    It is absurd to continue to make that claim in the face of the reality that we have one of the least effective healthcare systems in the industrialized world despite it being the least intertwined with government.

    Do tell. Where do you suppose you could go to have a better chance to survive cancer? No where.

    Government meddling has made it more expensive, this is true. However there is still a demand for quality and an ability to pay. Once government also tries to force costs down by authoritarian means quality and quality will necessarily suffer as we see everywhere else.

    But then, for you that’s fine.. that’s your real goal.

  204. # Tony | July 9, 2009, 1:16pm | #
    # I think it’s wrong to treat health care as a
    # commodity. It’s not something anyone ever
    # wants to buy, but are forced into doing so.

    # Even if the patterns of supply and demand
    # led to fair results on regular commodities,
    # certainly they don’t apply to a thing people
    # only buy because they are forced to by
    # circumstances. And those circumstances can
    # differ by hundreds of thousands of dollars
    # depending on the hand you were dealt on
    # health. Health is more important than
    # anything else, including wealth, to most
    # people, so they’re not going to treat that
    # service the same way they treat elective
    # procedures such as plastic surgery or lasik.

    OK, then let’s look for analogous market situations. What about transportation? Most people need it routinely, predictably. But who hasn’t had numerous random occasions in their lives, when they absolutely, positively had to be somewhere by a certain time (or at least as quickly as humanly possible) or face horrible consequences? Aren’t “heroic efforts” sometimes — often? — needed in transportation scenarios? Seems to me that the transportation case is roughly congruent with the basic characteristics of health care demand. So let’s run with it for a while.

    Do we find that costs of urgent transportation have risen over the years, to the point of bankrupting people who don’t have the assistance of “insurance” or the government? Not at all. In a modern, developed economy, you can get immediate transportation to pretty much anywhere, at any time, without having to take out a mortgage. About the only form of transportation that average people cannot at all afford, even once in their lives, is a trip to the International Space Station. If you have an urgent need to get THERE, you WILL need some kind of insurance or government aid, unless you are a multi-millionaire with an especially healthy bank balance. But for most other foreseeable urgent transportation needs, you can make appropriate arrangements, and arrive at your destination on time, without breaking the bank. Most of the time, especially for your non-urgent, routine transportation needs, you can even find numerous bargains. For transportation, as with practically all other goods and services, the markets drive down prices, and drive up levels of service and quality, through such powerful forces as competition, which inspires not only price-and-quality optimization of a given good or service, but also the development of ALTERNATIVE goods and services.

    The downward path of transportation prices is in spite of the fact that many of the people required for transportation, especially of the urgent kind, are highly skilled, experienced, educated professionals, whose time and talents are worth a lot of money (analogous to medicine). And it is in spite of the fact that much of the equipment employed in providing transportation is very expensive and complex (also analogous to medicine). The market spreads the costs of all of these expensive things across all willing purchasers, such that they each get a value that they deem equal to or greater than the value they give up to pay the fare. In many cases, this is done by using the know-how of the expensive people and the capabilities of the expensive capital equipment to produce products, which virtually anyone can afford and operate. For transportation, people can buy affordable cars and motorcycles. In medicine, people can buy affordable blood-glucose and blood-pressure meters, for example. Even more sophisticated instruments, such as sonogram machines, are dropping in price. Body scan machines are becoming easier to use and coming down in price, too — not yet to the point where you can have one in your home (assuming they could be sufficiently miniaturized, of course), but certainly soon to the point where a clinic in a large Wal-Mart might be able to have one and provide a body scan for prices similar to those the in-store optometrist might charge for full ocular workups. Speaking of eyes, Lasik surgery is highly automated — an important contributor to its ongoing price reductions. Any number of other procedures could also benefit, in terms of quality and cost, from greater automation or at least use of robotic assistance or more telemetry during the operations.

    My point is that there is no reason to believe that frequent urgent need for health care will necessarily defeat market forces in driving prices down. Advances in technology and know-how in the less urgent and elective areas of health care — especially in diagnostic equipment and procedures — will often apply equally well to urgent and emergency care, and will likewise lower the cost of heroic emergency efforts, just as in the transportation sector, as well.

    So why NOT treat health care as a commodity, at least in the sense of leaving it to be regulated much more by the marketplace than by government? The sooner we can engage the market to optimize price and quality, the sooner prices will be low enough for people to take seriously the suggestion that we should pretty much dump the “health care via (employer provided) insurance” approach, and return to paying for nearly all health care out-of-pocket, an approach that worked very well for us until we elected to make a left turn away from it in response to the “stimulus” of FDR’s wage and price controls of the WWII era. The “out-of-pocket” approach was NEVER broken, and if we return to it, it can serve us all well again.

  205. Hey y’all, I’m back…. but I’m sure everyone (including me quite soon) is in bed.

    I am all caught up now, but no one addressed one further piece of retardation presented by the infamous Tony, it’s so beautiful I am not sure why everyone missed it – or perhaps everyone else has given up trying to jam knowledge into Tony’s squishy brain.

    Tony writes:

    “My health coverage comes in the form of whatever the insurance company we do business with decides it should be

    Government interference is not truly the problem here…”

    So Tony… I’ve provided you with the history a dozen times over the months talking about this issue, but 3 guesses as to why you have health insurance tied to your employer.

    Could it possibly be because of government imposed wage controls in the 1940s? Oooooh I think it could be!

    “The major development in health care during the 1940s was the growth of employer-provided health insurance. World War II brought about a shortage of labor and wartime wage and price controls prohibited employers from increasing salaries to attract workers. However, in 1942 the War Labor Board decided that fringe benefits up to 5 percent of wages would not be considered inflationary. Employers began to offer health benefits as a way of providing additional compensation. Total enrollment in group hospital plans grew from less than 7 million to about 26 million subscribers from 1942 to 1945.(4)”

    [(4)Paul Starr, The Social Transformation of American Medicine, Pg. 311]

    Then… it surely, couldn’t also be the case that since the middle of the 20th Century, employer provided care has become the norm due to incentives built into the taxcode, right? Incentives like… oh, I dunno – allowing employers to write off insurance payments but omitting any personal allowance for individuals who might be paying for their own insurance.

    Tony. Get it through your ignorant skull: Government caused the problems you are railing against. Not only that… the programs the US government created which caused these problems are identical in theory to the ones you advocate! At some point, I would really like you to make at least an attempt to learn from history and to use some propositional logic once in a while instead of pulling shit out of your ass and then pretending your ideas make sense.

    And the fact that other nations’ health care is still “functional” is almost entirely irrelevant to this discussion – for a few rather important reasons. 1. The statistics are a quite misleading due to changes in methodology, and as noted above – you have a far greater chance of actually surviving various severe illnesses here over other nations, 2. Sweden, France, Canada & the UK’s systems are all going broke, and fast, which should show you that regardless of the snapshot you’re taking from them today their systems are ultimately unsustainable, 3. because every other nation benefits significantly from our research & innovation, of which we still have the best in the world in no small part due to the incentives to produce and be compensated properly – and 4. (Most importantly even…) the US will not adopt a program “like” Canada’s or Swedens!! So quit comparing apples to horses and debate the merits of the ideas as they are presented…

    Or…. you know… don’t, as you usually pick. I love that your ignorance always trumps your points though… Here you’ve expressed your displeasure with your employer provided health insurance and feel you have few options otherwise – and then you say that government has nothing to do with the problem… Yet, clearly, the only reason we went to a system where health care was tied to employment was as a result of government intervention to begin with, and the reason it’s harder/more expensive to get alternative insurance has to do with regulations & taxation…

    And it is now my bedtime.

    And James Merritt – haven’t seen a post from you for a while, well done on that last one.

  206. I’m sorry James Anderson Merritt…but the cat is out of the bag.

    We can NOT return to a fee-for-service model with health insurance at this point. This model would ONLY mean that people with lots of money would be able to afford health insurance.

    Remember, the ‘evil insurance’ companies employee millions of people.

    The majority of Dr. in this country drive Mercedes and live very well. This would not be the case had they had to cater to the REAL BUDGET people have to pay for treatment.

    Look at Africa, look at Mexico, look at Latin America. The system you speak about exists there…And, the local doctors Make Nothing. I know, I come from a Country (Dom Rep) where the doctors make nothing. Only those that cater to the rich live well.

    Libertarians/Conservatives prefer that lower income people and even middle-class people have to depend on the charities to give us healthcare while they enjoy top-notch healthcare…because they can afford it.

    Face it, all…there’s no changing the system at this point.

    – Going to a single payor will destroy the insurance industry and put millions out of work.

    – Making people pay out of pocket for everything would leave this entire country disease infested with all sorts of contagious conditions throughout

    – The Doctors/Clinics would actually go broke. It’s the inflated insurance benefits that they receive from the masses that purchased them their ‘house on the hill’ and ‘BMW’. If they had to collect money from the masses. I’ll tell u know, they won’t be able to charge NO $250 per visit. They’d probabaly have to go back to $50 per visit…and that would destroy most of them.

    – Prescription drugs would be a thing of the past. You’d be suprise how many people are LAZY and don’t fill a prescription that’s 100% paid for them because they don’t wanna walk to a phamacy. I never knew this to be the case…but it’s actually true. Do you think anyone is gonna pay $200-$400 for the typical asthma, heart, etc. medication?

    So, we have to live with the system we have…like it or not.

    No need for stimulus…no need for more money…no need for anything…the way it is is fine.

  207. Stossel almost gets it but doesn’t.

    He does make one key point that libertarians would be better off for if they came to terms with: Private insurance and government-sponsored insurance have the SAME moral hazards and the SAME economic failures.

    Arguing about which third-party should pay doesn’t solve the problem, which is inherent in any form of insurance.

    The libertarian “solution” is to make co-pays and deductibles so high that people actually start lowering their consumption. Unfortunately, we have been trying this and it just doesn’t work. People with “good” insurance are being bankrupted by health care bills due to the deductibles and co-pays, yet costs are still going up. It is clear that there is no level of co-pay which protects people from economic devastation (which is the point of insurance in the first place) while containing costs.

    Health insurance is a necessity, but comes attached with a flagrant market failure which cannot be removed without destroying the insurance. We just have to live with it, and acknowledge that markets can’t solve this problem.

    Oh wait, you are libertarians. You would never admit that, no matter how obvious the evidence is.

  208. Sean W. Malone | July 9, 2009, 3:38pm | #
    Russ:

    I struggle to find either of your examples “market failures”…

    Sean, you either don’t understand what a market failure is, or simply refuse to believe in them.

    In fact, your thinking should be the other way around. Free market theory requires the following two things to be true.

    1: The person involved is hyper-rational

    2: The person involved bears ALL of the costs and ALL of the benefits of every possible option

    Anything less, and the market fails.

    Pray tell, when do you think these criteria are met in the real world? The answer is “just about never”.

    The libertarian “solution” would suffer from third-party payer, agency, monopoly, and free-rider market failures. You probably don’t even understand what these are.

  209. Chad…u said a mouthful. And, I think you are right.

    There’s not much one can do about it. We are not going to close down the ‘evil insurance companies’ and put millions out of work. We are not prepared to put medical care in the same categorization as First Class seats and caviar and mink coats.

    Best we leave it alone. There’s always medicaid once one has lost their entire live savings and home. As for insurance, I would hope that the MASSES BOYCOTT insurance. Because the way insurance works now…it’s not worth purchasing…Unless you have money in the bank that you are afraid to loose in bankrupsy court.

  210. AO- What? Can you read? “Stossel- More health insurance means more cost”, ergo, less insurance all the way around and less cost. No insurance and it should be 20$ for everything. Just following the “logic” here. Prove it wrong, or try at least.

    How where the stewards of the economy that tanked so “regulated” that caused the crash?

    And yes, Americans cannot do shit without fucking it up. Prime example is drug legalization. In countries that have de criminalized drugs there are less people who do drugs, while if we did it here EVERYONE would be doped up. That is the info from the anti drug crowd, fear tactics. Me thinks you cannot read sir, an no I shouldn’t have to use small words or links to explain it to you. By your logic addressed to me, you should be easily able to show links to contradict me.

  211. “Free market theory requires the following two things to be true.

    1: The person involved is hyper-rational

    2: The person involved bears ALL of the costs and ALL of the benefits of every possible option”

    No.

    Point of fact, it doesn’t require people to be hyper rational and if you would take the time to read any free market economist, you’d know the vast majority of them explicitly believe that essentially the opposite.

    I get so sick of that bullshit canard. No free market economist believes that humans can be or need to be hyper rational because the vast majority of “us” (lumping myself in with that) recognize the Hayekian point that A. knowledge is highly dispersed across society, and B. value is subjective and ordinal – which means that FAR from being hyper-rational, people simply need to be self-interested… which…. they are. They can make mistakes, they can be wrong and they can do things that YOU disagree with (like buy CheapChineseCrap), but they don’t have any need to be hyper rational at all.

    Why don’t you do me a favor and go actually learn laissez-faire theory for once? Especially pertinent would be “Human Action” by Ludwig von Mises and “The Use of Knowledge in Society” by F.A. Hayek. Both will help disillusion you of the notion that “we” believe anything remotely like what your idiotic conception of free markets are.

    Further Chad, what you are failing to realize in the process is that if you think that a free market (where individuals make their own decisions about what to do with their time, labor, money, etc.) requires people to be “hyper rational”, a planned economy requires the planners to be fucking Gods – since they not only have to be hyper rational in order to save people from themselves, they also have to know the unknowable (millions of people’s ordinal preferences on thousands of day-to-day choices).

    Or of course…. They can do what they’ve always done throughout history and say what you always essentially say; “Fuck people’s preferences, I know better what they need.”

    I’m not amused by either your ignorance of the ideas you’re trying to refute or your lack of ability to extend your reasoning past a few basic cliches. And as for the “market failures” thing… Well… I explained why the specific examples do not qualify. Go back and read that why don’t you.

    And… briefly – Alice: You can go back just as easily as you got where we are now. It took 50 years to get where we are and it may take a while to get back to where we need to be, but all you need to do is change the basic incentive structures in place… Also, your constant Eyore-ism is getting annoying. Most insurance works just fine for the people who use it the right way. The masses have no need to boycott insurance and it is worth purchasing for most people – but it’s not “sustainable” as things are right now. Costs need to come down, and there’s only one way to do that, as I’ve said above already.

  212. Let’s not forget that a lot of routine care can be provided very cheaply especially when you realize that you don’t need a doctor for everything.

    Note the little medi-centers popping up in Walmarts etc.

    Also if you haven’t check out this excellent article

    http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?yrail

    It really looks at how our current system and set of incentives works to raise costs by using excess care without raising results.

    It’s estimated that you could cut out 30%!!! of costs simply by having the higher priced areas act like the lower priced areas without a reduction in care.

    but government mandates won’t fix this. Competition, and changing the incentive strucutres will.

  213. # Alice Bowie | July 10, 2009, 6:33am | #
    # I’m sorry James Anderson Merritt…but the cat
    # is out of the bag.

    # We can NOT return to a fee-for-service model
    # with health insurance at this point. This
    # model would ONLY mean that people with lots of
    # money would be able to afford health insurance.

    Say what? I am talking about putting health insurance way in the background, where it belongs. For most people, most of the time, no “health insurance” would be necessary, because treatment for common illnesses and injuries would be affordable out-of-pocket, as I spent much time above explaining transportation is now. You don’t have or think you need “transportation insurance” do you, even though you occasionally need to make that urgent, unanticipated trip…?

    The point is to break out of the box that we have been in since the mid-1940s (or, more correctly, to jump out of the frog soup cauldron, the temperature of which has been going up steadily since the 1940s): Access to health care is NOT and SHOULD NEVER BE equivalent with “health insurance coverage.” What we need is a “system” where:

    1. …if you have the cash to pay (or can get it from a generous benefactor), you’re in;
    2. …market forces optimize price vs. quality for health care goods and services — as in all other industries — so that the cash that MOST PEOPLE have can purchase the routine health care that they need, up to and including treatment for common illnesses and accidents, and even short-duration hospital stays;
    3. …true insurance is used only in ways and only for purposes that are analogous to those that characterize insurance for areas of life and business other than health care: fire, life, and auto, for instance.

    As far as the cat being out of the bag, all that is needed to stuff that kitty back in is a fiscal meltdown and/or revolution. We appear to be in the middle of the former right now, and if we survive it, the next one is almost sure to be worse, as a consequence of all the bad decisions being made now. That next meltdown, or the collapse of the socialized medicine “system” in the meantime, could spark a revolution. What I am suggesting, of course, is that we don’t wait for either of those two horrible circumstances; that we use a little common sense and exercise a little discipline and will-power NOW, to actually improve our situation on the one hand, and on the other, to avoid the catastrophe awaiting us down the road if we don’t.

    If I recall correctly, I was saying very similar things about taking our economic medicine and enduring a little pain a few years ago, in order to avoid the kind of economic conflagration we are now experiencing. So were a great many other libertarians. How many predictable — and successfully predictED — cycles of economic or political disaster do we have to suffer before we quit listening to the bozos-as-usual who keep leading us down those dead-end alleyways, and instead start moving with purpose toward desirable and reachable destinations?

  214. Sean Malone: Thanks for the kind words. For a long time, I have been bothered by not having a sound response to the collectivist assertions that we can’t treat health care like other goods and services because of the urgent, involuntary nature of demand in this case. I instinctively suspected that rhetoric was bullshit — in the same way that I rejected the assertions by flim-flam men a few years ago (some of whom were my employers and co-workers!) that “dot-com” enterprises weren’t bound by the longstanding laws of economics (“the rules are all different now”) — but I never had the time to think the whole health care demand question through until Tony’s comment proved to be the last straw. I suppose I owe Tony a debt of gratitude, as I finally now have a coherent way of calling BS on that specious assertion that has vexed me for so long. Your comment gives me hope that the argument is not only coherent, but potentially effective in getting the point across to others who, like me, haven’t had an opportunity before now to really think the situation through. Thanks again.

  215. You don’t have or think you need “transportation insurance” do you, even though you occasionally need to make that urgent, unanticipated trip…?

    Hmm…I am still trying to come up with scenarios where I would need to make an “urgent, unanticipated trip” that would set me back tens or hundreds of thousands of dollars, while I am likely unable to work. I am not having much luck.

    “or a long time, I have been bothered by not having a sound response to the collectivist assertions that we can’t treat health care like other goods and services because of the urgent, involuntary nature of demand in this case. I instinctively suspected that rhetoric was bullshit”

    I am looking to buy a flat screen TV. I have been researching various models and watching prices for months, all over a purchase that will be around $1500. If I break my leg tomorrow, I am faced with a $10000 purchase with no real chance to shop around. Like anyone else, I will go where the ambulance takes me or whatever is closest. This isn’t bullshit, it is reality.

    market forces optimize price vs. quality for health care goods and services — as in all other industries — so that the cash that MOST PEOPLE have can purchase the routine health care that they need, up to and including treatment for common illnesses and accidents, and even short-duration hospital stays;

    Wrong. You are assuming people are rational. They are demonstratably irrational when it comes to things with long, abstract pay-backs, like routine health care. If paying out of pocket, people would vastly under-consume preventive care. This is precisely why insurance plans deliberately subsidize it heavily – often literally paying you to go in for check-ups.

  216. Two points here, Chad:

    1. No one claims that free markets require perfectly rational actors except idiots like you who don’t understand free market theory

    “Wrong. You are assuming people are rational…”

    I’ve dealt with this a dozen times already. So has everyone else.

    Free markets do not… I repeat for emphasis… do NOT require people to be perfectly “rational”. It only requires them to be primarily self-interested, which (it’s quite easy to prove), they are. It’s about competing values, not about perfect knowledge.

    There is no transaction you will ever make in which perfect information exists, nor is there ever going to be one in which a human is suddenly a non-human and makes decisions without respect to “irrational” things like sentimentality, expedience, fear, nostalgia, etc. But most of all, perfect knowledge and thus “perfect rationality” cannot exist because you don’t know the future! Even simple transactions like a kid trading some baseball cards to his buddy for a basketball have uneven knowledge. Kid A has knowledge of the baseball cards, but not the basketball he hopes to get and Kid B has opposing knowledge. Kid A may decide he doesn’t even like basketball in a month – but if he’s trading, it’s a revealed preference for the ball today… The only thing that matters is the subjective valuations of the different goods – regardless of whether or not the choices are what you would make (Chad) or not – which seems to be your only qualification for people acting rationally.

    2. It’s government incentives, NOT random “irrationality” that has propelled people to act the way they do with respect to health care.

    “They are demonstratably irrational when it comes to things with long, abstract pay-backs, like routine health care.”

    Long abstract pay-backs for things like “routine health care” are pretty damn unnecessary when you have insurance that is cover every little sniffle you ever get, hospitals that cannot refuse treatment and Medicaid/care backing all that up and any time. When virtually all health care transactions are paid by someone else there is no incentive what-so-ever to worry too much about going to the doctor when you’re healthy.

    If you paid for 90% of your own health care out of pocket and only used your insurance in the case of true emergencies, then you have a lot more incentive to go do routine check-ups. You’re stupidly assuming that it’s people who are being randomly irrational by not doing something for which government meddling has created incentives not to do! I would argue quite the opposite – that in this case people are being quite “rational” given the circumstances. Or rather, they’re being rational in following the path that offers them the best deal in terms of their own self-interest… which is what I expect them to do, and thus why I’m not confused by the results of government policy like you always are.

    Anyway… Point is, whenever you blame irrational people you are really only revealing your own mindset: “Anyone who makes a choice I think is wrong is an idiot.”

    So I will once again repeat myself in the hopes that by some miracle it will make it into your brain:

    “f you think that a free market (where individuals make their own decisions about what to do with their time, labor, money, etc.) requires people to be “hyper rational”, a planned economy requires the planners to be fucking Gods – since they not only have to be hyper rational in order to save people from themselves, they also have to know the unknowable (millions of people’s ordinal preferences on thousands of day-to-day choices).”

    You fail Chad. And you fail hard. And you are fighting strawmen only made up in your own brain.

  217. Also – while I’m here… There are plenty of other analogs to emergency health care.

    Imagine for example, that you’re a small business owner in the bottled water delivery business. If your truck breaks down (not in an accident covered by insurance) you are potentially looking at exactly your criteria for why medicine doesn’t count as a market-good:

    A. Unexpected/Emergency
    B. Costly – Repairs to the truck will be thousands of dollars or even 10s of thousands if you have to replace it entirely.
    C. Puts you out of work for the entire duration of time it takes to correct (i.e. while your truck is “hospitalized”)
    D. Unless you’re a mechanic (car-doctor!), you have vastly uneven knowledge and will have to trust him to do guide you into the right repair (treatment) even though you probably don’t have any way of knowing if he’s going to be right.

    The only significant difference, economically speaking, is that in the case of health care, there is the massive boot of government up the ass of the doctor, hospital, insurance company & you – and when you get your car repaired you’re much more free to act voluntarily.

    To back up Mr. Merritt as well:

    If your grandfather in Switzerland died suddenly, you would indeed also need “emergency” transportation which would also fit those same criteria… Costly (a few grand for last minute airfare & lodging), imperfect knowledge (you don’t know the airline’s schedule or how to fly a plane do you?), unexpected and necessary (assuming you care about your grandfather of course), and you wind up missing work.

    Maybe I’ve just given you fodder to now advocate car-repair insurance, and grandfather’s funeral air-travel insurance, but I am hoping it will make you realize that there are plenty of situations that would fit the same category as emergency health care – or more importantly, that health care obeys the same damn laws of econ as everything else… and just like price controls in oil in the 70s, when you distort the hell out of the market process via government force, bad… BAD things happen.

    And thus we come to the only place where I will note a distinction between health care & other economic goods…

    When government fucked up the price signaling of oil and caused shortages, it was painful and really wrecked the standard of living for a lot of people… But when they fuck up the price signaling of medicine – people die.

  218. A lot of even handed polite criticism concerning this article has been removed, unless someone can justify this I am giving up on Reason for good

  219. Imagine if we let doctors pick our cars and insurance paid for the vehicle, the fuel and the maintenance. We would all be driving expensive tanks that get 7 mpg.

  220. Is there anywhere in the world that has market based health care?

    Singapore

  221. Mr. Stossel

    kill yourself

    quickly

    or at least never write again

  222. My only point is that if you take the Bible straight, as I’m sure many of Reasons readers do, you will see a lot of the Old Testament stuff as absolutely insane. Even some cursory knowledge of Hebrew and doing some mathematics and logic will tell you that you really won’t get the full deal by just doing regular skill english reading for those books. In other words, there’s more to the books of the Bible than most will ever grasp. I’m not concerned that Mr. Crumb will go to hell or anything crazy like that! It’s just that he, like many types of religionists, seems to take it literally, take it straight…the Bible’s books were not written by straight laced divinity students in 3 piece suits who white wash religious beliefs as if God made them with clothes on…the Bible’s books were written by people with very different mindsets…in order to really get the Books of the Bible, you have to cultivate such a mindset, it’s literally a labyrinth, that’s no joke

  223. Is there anywhere in the world that has market based health care?
    Ahmmm, no.

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