Comments on: The inherent problem with socialized health care

By: Brian

Brian — Tue, 08 Sep 2009 02:45:56 +0000

A graph I would be interested to see, and maybe you can provide, Mr. Arendt, is a demonstration of the proportion of annual personal income versus annual healthcare expense over the last 50 years or so. Granted healthcare expense has in general increased but with what relation to the increase of personal incomes? I doubt incomes will have increased at anything close to that of healthcare expense but just the same did healthcare make up a bigger portion of an individuals annual income when patients paid more or less out of pocket? I would be inclined to think that healthcare would have been a smaller portion when paitents paid more out of pocket because of the infrequency of the usage of healthcare services, but maybe you can enlighten me.

By: J.P. Arendt

J.P. Arendt — Sun, 06 Sep 2009 17:30:36 +0000

Weebles, some Americans do indeed go across the border for cheaper medication and health care. Have you? Only a few thousand Americans have. Not a high ratio.

I was in Mexico yesterday and I would not have even considered going in for an elective surgery down there. Mexico does cover many of the health care costs for its citizens, and it has gotten them into a bind. In 2005 Mexico covered about 45% of health care costs; the United States covered about the same percentage. This percentage has gone up, but only in recent years (it will probalby collapse as quickly as it came). Pre-existing conditions in Mexico are not covered for two years. Have cancer? Get out your checkbook. The public health care in Mexico is notoriously worse than the private health care there. Private hospitals are nice, clean, and advanced. Public hostpitals . . . not so much. In fact, family members are expected to be nurses of sorts in the public hospitals. Real doctors and nurses are only utilized for medical procedures. All other care is done by family members.

What’s more, the health care system is on the verge of collapse because of the heavy costs health care imposes on the government. Let’s take some time and see how this new system goes in Mexico. If the public hospitals are up to par with private ones and if the government does not ditch this program because of its high expenses within the next ten years, then color me wrong and let’s health care it up. I think we all know that won’t happen, though.

In the meantime, go on down to Mexico for your next surgery. It’ll save everyone in this nation a lot of money.

By: JP Arendt

JP Arendt — Sun, 06 Sep 2009 17:13:03 +0000

Karmakaze, the graph is from a study published by the Goldwater Institute, and can be found here: (http://www.goldwaterinstitute.org/Common/Img/011409%20Byron%20Healthcare.pdf). As you see in the article, I mistakenly gave credit to John Stossel and ABC News, when in fact he was citing the aforementioned study.

I have no idea why you are referring to medical prices versus general prices, but nothing mentioning general prices was mentioned in the article or in the graph. The graph compares the percentage of health care costs that are paid by individuals for their own health care to the overall cost of health care. No other price comparisons are made.

If, however, you are making the argument (and it seems you are) that the graph simply shows the affect of inflation then you are bringing up a wonderful, albeit completely out of scope, argument. If the government does pass this health care bill and does spend trillions more per year on health care, then we will likely see a similar trend on our inflation graphs.

By: Dan Moody

Dan Moody — Sat, 05 Sep 2009 06:09:10 +0000

Aurora, the real question is where were you about 70 years ago? Probably, like me, not alive. If you do some reading, you’ll find that people didn’t used to have insurance provided by their employers. Employer-provided health insurance came about because FDR decided we should cap executive pay. In order to get around that, companies paid salary + benefits (benefits did not count towards the cap amount of compensation). Eventually unions demanded health coverage too, and we got what we have today: a huge mess. Employer provided health care preceded the exponential growth in health care costs…. and that is what this graph shows, btw.

JMW – We actually do have socialized health care – not 100% socialized, but socialized nonetheless. Medicare and Medicaid, last I checked, were forms of socialized health care. This graph demonstrates the problem with third-party-payer systems. The point is that right now 85% of people are covered… some with better co-pays than others. Now, imagine if 100% of people were covered. Do you think expenses would get higher or lower? If you look at the trend of this graph, the answer is most definitely higher.

Eric B- This graph is not trying to blame patients. This graph shows the problem with a third-party-payer system. The problem is that when someone else pays your bills, you have very different incentives. That isn’t the patient’s “fault”, it’s the whole problem that was created by government intervention in the labor market (described above: salary caps under FDR). You are correct that if we rooted out the cause of high medical costs, free market efficiency would take hold. However, the root cause of high medical costs is employer-provided health care benefits that are not treated as income.

By: JMW

JMW — Sat, 05 Sep 2009 04:26:58 +0000

This country does not have socialized health care, so how can data about this country show us anything about socialized health care? UK has socialized health care… where are they on the graph?

By: Eric B

Eric B — Sat, 05 Sep 2009 03:57:03 +0000

This appears to show that as health expenditures by patients decrease, health costs increase. In fact, the per capita health care cost has increased around 900% from 1960 to 2006. The out of pocket share has gone from 47% to 13% according to this graph, so if health care cost you $500 in 1960 out of pocket, it costs $1245 today accounting for inflation. As a percentage of average income, it has stayed almost the same. This is what the market says health care is worth.

Only recently have doctors shifted responsibility for choosing treatments over to their untrained and ill-informed patients as a defensive measure. What has really caused the increase in health care costs is so-called “evidence based medicine”. It is really numbers-based medicine, where only the most profitable drugs and treatments are pushed through an expensive approval process, to be applied according to the numbers. The first consequence was an increase in the cost and use of treatments as the numbers dictated. The second consequence was that the numbers became a foundation for lawsuits if a doctor failed to follow them or a medical outcome was different than the numbers suggested. To mitigate the risk of lawsuits, doctors were forced to carry expensive malpractice insurance and perform many expensive and unnecessary tests on their patients. The combined factors of expensive treatments, overuse of treatments, overuse of tests, and malpractice insurance have caused the rise in medical costs. As prices rise, people turn to insurance to keep their direct expenses the same and to protect their assets if disaster strikes.

Insurance allowed this monster to grow, but it did not cause the problem. Had people not turned to insurance, widespread bankruptcies would have caused public outrage and a turn toward cost effective medicine. The big medicine business has framed the debate only in terms of who should share the costs of health care because either way they win. Blaming the patients for their own medical costs, as this graph attempts to do, is just one of their most cynical tricks. If we were to rout out the causes of high medical costs, people could pay their expenses directly and we could again enjoy the benefits of free market efficiency.

By: weebles

weebles — Sat, 05 Sep 2009 03:51:48 +0000

Right across the border in Mexico, you can go to American doctors for medical/dental treatment and procedures and purchase American made medicines for often 1/10th the cost of what you pay here in America. And most of the patients are American.

Why is that? Apparently this situation is profitable for the American doctors.

By: dogismyth

dogismyth — Sat, 05 Sep 2009 03:07:12 +0000

I’ll tell you what.

You stop the trillions of dollars that are spent causing and fighting wars, the billions sent out as foreign aid (government bribes) especially Israel, the trillions to insolvent banks that have mismanged their affairs, the billions spent on coverups, the billions/trillions paid in interest to the federal reserve for doing what Congress/the people could do…

and then explain to me why we would not have enough money to provide the finest medical care for every goddamn citizen in this fucked up country.

By: Aurora

Aurora — Sat, 05 Sep 2009 03:00:09 +0000

What the fuck?
THE REASON we need insurance was because people CANT AFFORD to pay out of pocket any more.
sheesh where the fuck have you idiots been for the last thirty years.

By: J.P. Arendt

J.P. Arendt — Thu, 03 Sep 2009 16:14:21 +0000

Health care is one of very few things that we don’t pay for out of pocket. When you know that insurance will pick up most of the tab there is an incentive to get more than you need and a further incentive to not care about what you pay beyond your copay. If people paid our of pocket for health care it would create incentives to find the best service for the lowest price. This would then incentivize doctors and hospitals to provide the best care for the lowest price to attract customers. When people pay out of pocket for anything the quality and price will inevitably decrease.

We enter a serious moral issue with socialized insurance. By paying for health insurance you are voluntarily giving your money to a fund on a risk based level that will then go to treat other people’s ailments. However, with a government run program, you would involuntarily be giving your money to help others’ ailments. The voluntary vs. involuntary is where I have the biggest problem. Of course, the absurd inefficiencies don’t help the case for socialized health care either.