Nearly 30 years later, after tens of millions of dollars from foundations and the active participation of top executives of Fortune 100 companies what is there to show for all this effort? I suspect it cost the health care system far more than it saved, and decreased efficiency as more time was spent on bureaucracy and less on patient care. All because the underlying premise was wrong — greedy doctors are not needlessly filling hospital beds to enrich themselves.

...

And some doctors are jerks. So are some Fortune 100 executives, hospital administrators, and health care economists. So what? I would wager that as a group physicians are more ethical and more caring than most other professions. If they over treat their patients, it is out of an abundance of caution rather than greed. When you have someone’s life in your hands, you want to do everything possible to save them. This is a good thing.

Given the record of massive, epic failure from the “health policy community,” I would much prefer to put my fate in the hands of any physician randomly found in the phone book than any of these bureaucrats.

Unlike many other health policy scholars, he: (1) takes a nuanced view of the players in the game, (2) does not take the easy way out of blaming doctors for every problem under the sun, and (3) he views the political problem as one of government versus voluntary human interactions, rather than as left versus right. 

Read the whole thing.

"With regard to the idea of whether you have a right to healthcare, you have to realize what that implies. It’s not an abstraction. I’m a physician. That means you have a right to come to my house and conscript me…It means you believe in slavery.”

Some libertarians, including Matt Zwolinski and Matt Welch, have taken Paul to task, saying the word “slavery” should be reserved only for the extreme case.  But neither of them offers a good argument.  Here is Matt Zwolinski:

“However wrongful and coercive universal health care might be, no one’s advocating beating down doctor’s doors and hauling them away, no one’s advocating that they be bought and sold or separated from their families…”

First, this is not entirely true.  In Canada in the 1970s, under Bill 41 doctors really were conscripted and forced to work under penalty of jail sentence.  Those who spoke out about the law were subject to jail for up to a year and fines of up to $50,000 per day.  Even in the United States, under EMTALA, hospitals and ER doctors are required by law to treat every patient who walks into their emergency room.  

Second, libertarians commonly use the word “freedom” (i.e., the opposite of slavery) to refer to small changes toward a completely free society.  For example, the Cato Institute has a center in which scholars advocate for education policies that don’t necessarily lead to a 100% libertarian society, and yet it’s still called the Center for Educational Freedom.  If it’s ok to use “freedom” in this sense, why is it not ok use “slavery” to refer to any policy that moves us closer to a slave society?

Perhaps part of the reason that some libertarians oppose the wide use of the “S” word is that the connection between something like universal healthcare and slavery is difficult to see. That’s because the slavery in welfare programs is more dispersed.  In the case of healthcare, it isn’t necessarily the doctors who are enslaved.  Instead, it the taxpayers, who are forced to spend a part of the product of their labors on medical care for themselves and others.  If the government determined how some small number of individuals were to spend 100% of their money, it would obviously be slavery.  The fact that it’s less than 100%, and it’s a large portion of the population makes the case harder to make, but the fundamentals are no different.

Another reason why people may oppose the use of that word, as pointed out by Bryan Caplan, is that most people think of slavery not just as involuntary servitude but as low-status involuntary servitude.  Doctors and tax payers are higher status in our society, so it is hard to think of them as slaves.  

5. Journalism, including a post about unconscious framing and its relevance for NPR.

6. Medical Ethics, with a commentary on physician-industry relationships that predictably calls on physicians to stop their interactions with pharmaceutical companies, without mentioning the alternative perspective.

But the problem is that none of these proposals have any better method of determining physician fees.  They want primary care physicians to make more money, but they don’t specify how much more, or how that amount should be determined.  They just support more “transparency” or a more “diverse panel”. 

Fundamentally, there are two ways to set physician fees.  One is by convening a bunch of people – physicians, insurers, politicians, etc – and coming up with a payment method.  Another is to let each physician charge as much as he can, let patients pay as much or as little as they can or would like to, and see what happens.

Currently, Medicare does it through the first method.  All the reform proposals just want to tweak that method, hoping to come up with a political alliance that is more in their favor.  None of them want to use the second method by, say, turning Medicare into a voucher system.  But it’s not clear why the committee method is more favorable than the market method.  If primary care physicians really are underpaid relative to the value they add, the latter method would surely raise their relative fees.  But the result of the former method is unpredictable – it depends on who ends up winning the political battle.  

“The professional ideology assumes that the professional is an expert as a result of his years of education and learning.  Since he knows more about his area he should tell others what they “need.”  Consistent with this is the idea that the public is unwise and unknowning.  This is in contrast to the idea of consumer sovereignty where the consumer is the best judge of his own desires.  Physicians have tended toward the former ideology and businessmen and economists toward the latter.”

Physicians are trained to practice in a very specific way: gather the patient’s information, put it together to figure out what the patient “needs”, and then inform the patient. There is, of course, a principle of autonomy that allows the patient to refuse what the doctor suggests.  But there isn’t a model of engaging a patient in the decision-making process, nor of factoring costs into the determination of “needs”. 

This means that health savings accounts, and consumer driven health care in general, are incompatible with medical culture as it stands today.  Only the uniquely creative or open-minded doctor will know how to work with them. 

The purple plan may be better than the mess we have today, but that’s not saying much.  It's main advantage is that there are no longer separate plans for the elderly, poor, young, etc.  Otherwise, the plan is full of problems:

1. It has no mechanism for allowing people to choose between health care and other uses of money.  The amount that must be spent on health care is determined by the size of the voucher. 
2. The risk adjusted voucher creates an incentive to become sick, or remain so, or at least to have more problems listed in your medical chart.  Soon doctors will be saying things like this: “your fasting glucose level is 190. Technically, 200 is diagnostic of diabetes, but, well, you’re close enough”. 
3. The “panel of doctors” will face pressures to include more and more services in the standard plan.  If they face a strict budget, they’ll still face pressures from various specialties to include one service versus another.  If you think there’s an objective way to determine whether pregnancy and childbirth coverage is more or less important than Electroconvulsive therapy for depression, think again.  The decision will be made according to the beliefs of the panel members, or the relative lobbying efforts of various specialty groups. 

There are more problems, but I’ll stop here.  This plan may very well be designed by economists, but it is designed nonetheless.

Notice that the budget in 2021 is still much higher than it is today.  

My favorite criticism of Paul Ryan's budget so far is Ezra Klein's, which can be summed up as: it's not THAT amazing.  

HT Chris Edwards at the Cato Institute

Meanwhile, Obamacare will impose community rating in the new health insurance exchanges, which is a large step in the opposite direction.  Several steps back.

Why is Arizona taking such a wimpy step?  Why not have smokers pay for the entire cost of their behavior, or turn Medicaid into a voucher system?  What is $50 going to accomplish?  According to Monica Coury, the spokeswoman for this project,

"It engages the consumer to start having a greater awareness of how they fit into the bigger health care puzzle"

Yes, that is the true function of prices, but $50? Really? A smoker who quit would save more than that amount in cost of cigarettes, even without the new proposal.  And a diabetic would have to pay much more than that for a yearly gym membership.  How much more incentive does an extra $1 per week add?

Yet even this modest proposal is drawing critiques from the responsibility-does-not-exist crowd:

“Democratic state Sen. Kyrsten Sinema said that isn't fair to diabetics.”

The unstated assumption is that it is fair for the rest of us, even those who already pay for expensive gym memberships, to pay for the health care of less responsible strangers.

In a survey, Republicans were more likely than Democrats and Independents to correctly answer 16 of 19 scientific questions.  The exceptions were: a question about evolution, one about polar ice caps, and one about continental drift. 

See it here.

HT to Marginal Revolution and John Goodman.