• Priceless: Chapter 2 – ctd.

    I just finished reading Chapter 2 of  John Goodman’s book Priceless. I have a few thoughts. I look forward to hearing more of yours:

    1) Right off the bat, John leaps into an argument that those who don’t understand systems shouldn’t tinker with them. I couldn’t agree more. Of course, I assume he doesn’t demand perfect understanding of something, because we shouldn’t let the perfect become the enemy of the good. But what confused me is that he admits health care is a complex system only as an argument to avoid “experts” making decisions. I would make this same argument (and have) to say that often it’s a reason why we shouldn’t always put things on individuals. People don’t discriminate well between necessary and unnecessary care. That’s proven. It’s why I often have a problem with consumer directed health care. So I feel like he’s making an argument against what he likely supports.

    2) I agree with John that regulations are an issue. Malpractice, on the other hand, isn’t in the same class. Tort reform will not fix the cost of health care. And while we’re on regulations, I have to admit I’m a little tired of people on the right claiming that those on the left don’t think the doc shortage is a problem. Come on, do you read this blog? It’s a problem regardless of the ACA, and I FULLY ADMIT THAT BRINGING MORE PATIENTS INTO THE SYSTEM WILL REQUIRE MORE DOCTORS. Happy? The “government” isn’t the stumbling block here.

    3) I get that John doesn’t like “shifting” in the sense that one group is better off and one is worse off. But if we spend less on health care, then providers will make less money. Someone has to. People arguing for more consumer directed care want the same end result that those who like the ACA do. They want less spent on health care. The results of that are the same: people in the health care system will make less money. They just differ on the means by which we achieve those goals. Pretending that they differ on the end result is misleading.

    4) I agree with Austin that John’s arguments about the price of waiting are good. But wait times are often created by the lack of physician availability. Why is that entirely government’s fault? There are plenty of groups fighting that.

    5) If John wants to give everyone on Medicaid private insurance (ie the exchanges), he’d find a lot of support for that from Democrats. But it will cost money.

    6) John and I have gone around and around with respect to the fact that a few people spend a lot of the money. I see that as a reason HSAs won’t work. He sees that as a reason they will.

    And now we get to me. Yes, me. Surprisingly, I make a real appearance in Chapter 2, for this post:

    If my child’s life were at stake, I would fight tooth and nail to get anything – and I mean anything – to save him or her. I’d do it even it it cost a fortune and might not work. That’s why I don’t think you should leave these kind of decisions up to the individual. Every single person feels the way I do about every single person they love, and no one will ever be able to say no. That’s human.

    Similarly, I don’t think that it’s necessarily fair to make it a physician’s responsibility. I also want my child’s doctor to fight tooth and nail to get anything that might save my child. Many times, physicians have long-standing relationships with patients. Asking them to divorce themselves from the very human feelings that compel them to do anything that might help their patients is not something that I think will necessarily improve the practice of medicine. They also should be human.

    So whose job is it? Well, mine for instance. That’s what I do as a health services researcher. That’s what policy makers should also do…

    I’ll note that I have continued to evolve my thinking on this issue, as happens with a blog. Citing one blog post isn’t the best way to lock in my thinking on an issue in perpetuity. But I do see how that post served as a good foil for John’s arguments.

    But he misrepresents my intent a little. I wasn’t arguing that government should set what people can and can’t do. I was arguing that – in certain cases – dispassionate third parties may need to. Insurance companies do this all the time! Here’s what came after the ellipses:

    That’s what we, as society should do. There are people who should have the responsibility of debating and deciding what is and is not cost-effective. They should have to make decisions that may be unpopular, and they should have to face the wrath of those whom the decisions impact. But there’s no good way to make it an individual’s responsibility to determine what is cost-effective for their child. That hardly seems “ethical”. I’m not sure asking doctors to do it is such a good idea either.

    But ethics is something we can and should debate. I hope we can have a robust discussion about this.

    John makes a lot of hay by claiming that my desire to spend any amount of money even for no benefit is not a rational or usual way to spend money. He’s right. I was talking about a specific instance, one in which my own child was dying.

    I’m acknowledging that while I’m entirely rational and even “parsimonious” in many activities, as a human being and a parent those abilities may be lost in this specific case. I’m also acknowledging that in this specific case, doctors who are involved with patients may lose that ability as well. In those cases, we may need others not emotionally lost to help us decide how to spend other people’s money. At least, I think we can debate that point without imagining it’s the ravings of a government-loving-Soviet-style-planner.

    @aaronecarroll

    Programming note from Austin: The next post by me on Chapter 3 will appear on Monday, not Friday. I’m giving Aaron a chance to catch up.

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    • @Aaron
      ” I would make this same argument (and have) to say that often it’s a reason why we shouldn’t always put things on individuals.”

      If we don’t “put things on individuals” (regarding personal health care) who should we put them on? Committees? Inanimate rules on a piece of paper? A bureaucrat in Washington or the patient’s doctor at the bedside? Maybe things should start with the patient and end there where the patient or his chosen agent selects the one who helps him make decisions. Should not the ultimate choices be left to the individual?

      • Aaron answers this…

        “So whose job is it? Well, mine for instance. That’s what I do as a health services researcher. That’s what policy makers should also do…”

        “That’s what we, as society should do. There are people who should have the responsibility of debating and deciding what is and is not cost-effective. They should have to make decisions that may be unpopular, and they should have to face the wrath of those whom the decisions impact. But there’s no good way to make it an individual’s responsibility to determine what is cost-effective for their child. That hardly seems “ethical”. I’m not sure asking doctors to do it is such a good idea either.”

        Try reading past the first couple of paragraphs before jumping to a conclusion.

        I for one, who is not a health expert, generally agree with Aaron’s frame of thought. I seriously doubt I’d be able to make the highly informed decisions needed for consumer driven innovation. If a doctor tells me I need a certain test, I’m inclined to agree. Sure, I may get a second opinion, but no matter what – I’m relying on someone else to make a decision for me.

        Naturally, this makes me uncomfortable. I’m used to being able to make my own informed decisions. However, the human body is quite complex. I can easily build a computer for a fraction of the cost of a pre-made one. I cannot easily compare test between providers. Also, if I screw up a computer, I’m out a few hundred bucks. If I screw up my body, I’m out of my livelihood (which I put more value on than anything else).

        I do not understand the magic behind consumer driven choice.

        • Brian, surely you believe that when there are differences of opinion you should be the ultimate arbiter of what happens to your body.

          My conclusion remains the same and yours should as well unless you feel another has a right to determine what happens to your body.

          • Who is denying that? What we’re debating is whether you have access to other people’s money to do whatever you want to your body. No one here has discussed refusing care – at all – to people willing to pay.

            • Aaron, in other words, taking the next step, what you are saying is that the market failure we see in health care is due to governmental intervention that takes the taxpayer’s money and then claims the right to limit its use to satisfy the government’s own needs. That is not a voluntary agreement and is one of the reasons we have as many problems as we do. It is, however, the crux of the issue, what functions best? I believe the market (not denying government regulation and subsidies) is better and considering what we have seen in other markets it is up to you to prove otherwise.

              (Hayek makes mention that government intervention in the health care market should have the least possible negative impact on the market)

              By the way under Medicare rules it is my understanding that a physician who contracts with Medicare cannot make a separate contract with the patient even where there are legally signed guarantees that the government will not be involved in payment for services.

            • Austin, I find the Klein editorial you referred to troublesome and thus I didn’t bother with the other one. One of the quotes stopped prematurely before the next sentence that referred to the issue, social insurance.

              Hayek: “It is planning for security of the second kind which has such an insidious effect on liberty.”

              I would have liked the author to have provided page numbers. When checking with the electronic copy I had available I could not verify his quotes and their combined sentences do not appear to be from the same location. I am having a bit of trouble with my computer right now so I don’t wish to condemn the author.

            • The other one was the better one, in my view.

            • @Austin: “The other one was the better one, in my view.”

              Austin, then perhaps you should have not presented the inferior article at all. I figured the Washington Post would be a better source than thinkprogress which I have noted in the past to be very unreliable.

              I don’t see the merits of this article. Culling a paragraph out of a book saying ” take this as saying that Hayek would support…” provides an opinion of what the writer would like to have had Hayek say and doesn’t deal with the reality of what Hayek says and all the contrary statements Hayek made in his book.

            • Whatever. I was just providing some links for readers who might not know anything about what Hayek said about health care. Feel free to provide others. I’m not engaging in a debate here.

            • @Austin: “Whatever. I was just providing some links …”

              Fair enough. It is just that neither of those two articles provide an adequate interpretation of what Hayek said. Anyone interested can read his book and dispense with all the erroneous thinking about what was actually said. I merely pointed out Hayek because he did mention that government COULD have a role. His concerns were that the market be interfered with as little as possible. He wasn’t advocating a socialized system. In fact he warned against one.

            • “Anyone interested can read his book”

              Of course! But there is heterogeneity of interest and opportunity cost. Surely there might be something shorter out there that focuses on Hayek’s views on health care. It’d be of great value to find it and point readers to it. I, for one, would enjoy reading it.

            • Austin, short is not necessarily accurate, but I am sure there are plenty of readable essays around for personal consumption. Hayek was against central planning, but just like some other well known classical liberal thinkers that didn’t mean that the state had to be totally excluded from all social issues.

          • If that is what you took from my post, then I was not clear. To use your statement, I still believe that I am my body’s keeper. However, the point I tried to make is that health care is unique from the perspective of information asymmetry.

            When I shop for products, I have many resources available to compare choices. However, I’m not going to go to WebMD and try to become my own health expert. I’ll go to the doctor, not lead the discsussion, and answer his/her questions truthfully. I can get as many opinions as I want but ultimately I am still not, nor will I ever be, the one in the position to make an informed decision. I can simply use what I’ve been told and go with the doctor I trust the most. Whether or not that doctor is actually following evidence based research, I probably will not know. Nor will I have the ability to correct that information gap. You can’t possibly think that customers are going to hold their doctors responsible for research that they probably don’t know about themselves.

            I do not have a fear of academics. I do fear the human propensity to ignore evidence and engage in emotionally charged decision making. That is why I think academics, like those on this blog, deserve a large stage to show evidence and should play a role in how our healthcare system moves forward. Simply shirking that duty to the individual is a total abdication of their responsibility.

            You can’t always assume the consumer is rational. From my own experience in business, I can assure you that if anything – customers are finicky and irrational.

            • @Brian
              “health care is unique from the perspective of information asymmetry.”

              There is information asymmetry everywhere and that is why reasonable people will attempt to find opinions that best suit their needs. If you think information asymmetry is the leading problem then I don’t see why you don’t advocate that government provide information in the most difficult of these areas. There need not be any charge. The private sector already is doing that more and more. Check out the Mayo Clinic on line and it helps people manage their symptoms and diagnosis so they can better understand their diseases.

              ” I can simply use what I’ve been told and go with the doctor I trust the most.”

              That is right and that is what we do all the time. The government doctors aren’t more brilliant than some of the doctors we see in the communities or universities.

    • What’s “personal health care”? The truth of the matter is that patients depend on physicians and other clinicians greatly. When they are told they need something, they get it. For most of the expensive things, patients are not the drivers of health care spending. Therefore, when we want to curb it, acting on them isn’t the best way to do so.

      Moreover, since patients discriminate poorly between necessary and unnecessary care, they often cause themselves harm.

      Why does it have to be bureaucrats? Why can’t we lean on providers to stop doing and prescribing things that don’t work?

      • @Aaron
        ” For most of the expensive things, patients are not the drivers of health care spending.”

        Isn’t the driver of health care spending the one that is spending the money? People depend upon others all the time, medicine is no different. Electric shock can kill a person so I depend upon an electrician.

        “Moreover, since patients discriminate poorly between necessary and unnecessary care, they often cause themselves harm.”

        That is why people ask others for advice and service such as physicians, lawyers, electricians, roofers, etc.

        “Why does it have to be bureaucrats? Why can’t we lean on providers to stop doing and prescribing things that don’t work?”

        We can, but who should make the ultimate determination of what is or is not necessary when there is a multitude of opinion? Are you advocating the patient lose his right of choice over his own body?

        • Al:

          When I go to a doctor who says I should do “X”, exactly who is spending the money? I would suggest that it is not me the patient but rather the doctor. Sure, I can decline to do “X”, I can shop around to find the best price on “X” (maybe) but in the end, I sought out an experts opinion. That’s one of the primary reasons for going to a doctor.

          If you want the patient to have a real say in their medical expenses, then you would have to eliminate the doctors (and other professionals) status as a gatekeeper in medicine. No more requiring prescriptions, for instance. I don’t see that happening.

          • @MV:
            “When I go to a doctor who says I should do “X”, exactly who is spending the money?”

            In a backwards fashion you hit the needle on the head and I believe have proven John Goodman’s position to be correct.

            When you go to a doctor and he tells you that you need an MRI that will cost YOU $300 to several thousand dollars suddenly you start to think of three basic things 1) Do I really need it? Can I wait a week and see if the pain goes away? 2) If I spend the money on the MRI could it be better spent on something else? 3) How can I get *only* what I need at the lowest price.

            What we have done to healthcare is to make those three questions disappear.

    • Here is a global response to some chapter two comments. It is obvious that patients have imperfect knowledge. In fact everyone in health care has imperfect knowledge. I don’t mind government having an opinion or offering an opinion. Ditto for health insurance companies and employers. What I don’t want is the government (or some other bureaucracy) ordering us around and telling us all what to do.

    • On allowing people out of Medicaid and into private insurance, I do not envision spending more money. In fact there is no proposal in Priceless that calls for more spending or higher taxes.

      I believe I saw at this site the other day that Medicaid is spending $3,000 per adult and $2,000 per child. For a young adult and for children you can buy very adequate health insurance for these amounts in most places. It will not be first dollar coverage. But it will allow the insured to see almost any doctor and enter almost any hospital.

    • I am not a health care policy expert by any means, but going thru the comments on this post I wonder if there is just a bit too much theoretical posturing going on.

      From a practical perspective, are there not huge amounts of data from various different health care systems around the globe? Are there not some good analyses showing which approaches deliver a reasonable amount of care for the most people at the least cost? Do any of those systems prevent those with more funds available seeking higher levels of care?

      Some of the arguments being advanced above seem to be based more on a belief in American exceptionalism than attempting to resolve the practical issues at hand.