Government Health Care

Food for thought. Of the people ranting about not wanting to let Government get involved in their health care, how many have any experience with Government Health Care? I don't know, but as I started thinking about how many different programs there are,I suspect many Americans have experienced "socialized" medicine without really thinking about it. Here are the major health care systems I can think of that are Government run.

1. The Veterans administration. According to a 2007 ABC news report the VA health care system, which serves some 5 million veterans and their families, has become one of the best health care systems in America at providing economical quality health care. Being a veteran myself I must admit to having a pretty negative image of the VA, but as I reflect on recent personal experience taking my Dad to VA appointments, the quality of care did seem pretty good, despite the Wal-Mart'ish ambiance.

2. The Military. It has been many decades since my stint in the Army. My recollections of my experiences with Army doctors and hospitals were they lacked in frills and you didn't get much TLC, but you got what you needed, and I am pretty sure the Army was doing it pretty cheaply.

3. Medi-care. A huge system, from what I understand virtually every person over age 65 is required to subscribe by private health insurers. So effectively, at that point in life where almost everyone starts needing lots of health care, private insurers start passing the cost of health care on to Government.

So, I guess the way our system works is the Government does all the dirty work, takes care of Veterans, Military folks and old folks, while private insurers cherry pick the people that need the least health care. Sound about right?

Motivation in Health Care

How can the US be such an economic dynamo, but be so bad at providing effective and economical health care. Perhaps the US problem lies in the motivation of the people that run health care in the US.

We all know that people are different. We all like money, but for some people it is a lot more important than others. Some people find happiness in money - or the power and security money provides. As the go through life at each decision point they chose the path that leads toward personal power and security - building businesses and accumulating wealth.

Some people find happiness in helping people. When they reach decision points in life where a money motivated person would perhaps chose business school, they chose to be a teacher. Instead of law school perhaps they become a nurse.

In the US Corporations pay for health insurance for their workers. Corporations own hospitals and other health care facilities. Corporations own Insurance companies that provide the Health insurance. All Corporations are run by people motivated by money. They have devoted their lives to climbing the corporate ladder. They know money and how to wield power, but they don't necessarily know how to take care of people.

Perhaps the US needs to find some way to put more people motivated primarily by quality health care in charge.

Economics 101 and Health Care

In the US we long ago adopted free markets as the basis of our health care system. Today we spend twice as much per person on health care as any other country in the world, but our lifespans are shorter than many other countries, and we are generally considered by the World Health Organization to have a pretty mediocre health care system.

Are we just inherently unhealthy people? Or is there some basic flaw in the way we do Health Care.

Perhaps we should go back to Economics 101 - Consider what it takes for a free market to work effectively -

1. Low barriers of entry - when demand exceeds supply it must be easy for other people to move into the business.

In the US you cannot be a doctor with going to a school approved by the Doctor's Union (the AMA) and then passing tests, and then working incredibly long hours for peanuts for years to get experience. The AMA has, effectively, a supply monopoly. We clearly fail the low barriers to entry test.

2. Buyers and sellers not acting under compulsion

If you go in to buy a car, and all the cars seem overpriced, you go to another dealer, buy a used car, or just don't buy anything and make due with your old car. So free markets work wonderfully for cars. Or toasters, or ...

On the other hand, if you have a heart attack, you are in no condition to shop around for a doctor, bicker about the price or just walk away if the price is to high. If your child breaks a leg falling off a bike, you aren't going to spend your time shopping around for the best deal, or just walk away for awhile if everything is to expensive. Health care fails the no compulsion test as to buyers.

To some extent our system substitutes insurance companies for us - we buy Insurance and it is up to the company to do the shopping around and negotiating. Two problems with this approach.

First, Insurance Companies are driven by the need to make profits, so they are constantly pulled toward the cheapest path. It may be cheaper to find ways to limit coverage than to negotiate. They aren't feeling the patients pain, they are feeling the stress of their balance sheet.

Second, there is still a limited supply of doctors. As long as the Doctors jointly hold out for certain levels of payment, the Insurance companies have less room to negotiate. Insurance companies are contractually obligated to provide coverage, they can't just walk away if Doctors are unreasonable (and we wouldn't like it if we had to routinely go to a Doctor or Hospital 150 miles away because it is more cost effective).

Comparing Health Care Systems

How does the US health care system stack up against other countries health care systems? According to World Health Organization studies:

In absolute terms - measured per person - the US spends twice as any other country, and far more than twice as much as most countries. As a percentage of Gross Domestic Product we rank number 2 - only the Marshall Islands spends a bigger percentage of their GDP on health care. Marshall Islands? Who are these upstarts who denied us number 1 ranking in blowing money on Health Care? According to wikipedia the Marshall Islands are tiny islands in the Pacific Ocean granted independance by the US in 1986 . The US used to use the Marshall Islands as a Nuclear Testing ground - they have wonderful pictures of mushroom clouds over the Marshal Islands. Gee, wonder why these little Islands in the tropical Pacific have to spend so much on Health Care?

In the effectiveness of the health care system the US ranks 37th out of 190 countries. The 36 countries that provide better overall health care all spend far less, both per capita and as a percentage of GDP. The 36 better countries include Islamist countries like Morocco, the United Arab Emerites and Saudi Arabia as well as Canada, England and Sweden, the western single payor systems often derided as "socialized medicine". Wretchedly governed Cuba is right behind us at 39th.

In life expectancy we rank 24th. Italians may still have an active communist party but they live quite a bit longer than us. Canada, England and Sweden, with government run single payer systems, all live longer than us. In Isreal, despite suicide bombers and the occasional missle, folks live longer than us.

In a study of selected countries looking at the performance of the health care system in preventing preventable deaths, of the 14 countries studied, the US was dead last. Two of the countries in the study were single payor "socialist" systems, England and Sweden.

But, take heart, although spending lots of money doesn't seem to keep us from being lousy at health care, as this is being written we kicking butt when it comes to the Olympic gold medal count.