I’ve now written enough on this on Google+ to warrant a post. Here it is.
I think many are missing a key point and an interesting set of questions related to my post on Woodward’s and Wang’s recent paper. I concluded that post with,
Politics and entrenched interests have a lot to do with how health care dollars are spent. But, as Woodward and Wang suggest, so does the fact that we have come to expect more for our health care dollar (or someone else’s) than just health. Bending the curve will require breaking our expectations. So far, I have not seen good evidence that we are willing to accept what that means.
Do we receive and value lots of non-health-improving aspects of our health system: hope, information, other comfort-enhancing amenities? I think this is a very important question that many overlook. It may be the very reason “rationing” and “death panels” frighten and work politically. It may not be the fear of greater morbidity and mortality, but the fear of losing the hope of something better, access to information (fancy imaging) even if it doesn’t improve care, and the like.
Put another way, at its heart, high and rising health care spending may be more culturally or psychologically driven than economically or politically. Sure, economics and politics matter, but one has to ask why? And why for so long and with essentially the same outcome? Maybe we have to look more at ourselves, within ourselves, than at the system.
It’s worth asking, as Ezra Klein essentially has, why the difference with Europe? My answer, in the context of what I wrote above, is this: You take the nature of humans and health, mix it with the unique path we’ve taken to our policy trap (a la Paul Starr’s Social Transformation of American Medicine and his forthcoming Remedy and Reaction) and you’re stuck in a place Europeans are not. We’re now boxed in technically in large part due to psychology. Europe avoided the box, so the psychology is less relevant (though not irrelevant). But the answer isn’t found in today’s market/policy, it’s a 100-year path.
That’s why pointing at Europe and saying, “Do it their way and we’ll be better off” doesn’t work. It may be correct technically, but it doesn’t work culturally, psychologically, hence, politically.
Back to Woodward and Wang, the essence is: we’ve seen the hope and amenities that all the extra spending buy and we like them. At least that’s a perfectly reasonable, revealed preference interpretation.