Thursday, July 22, 2010

The Rational Rationing of Health Care

Everything in the physical world is rationed.

There's a finite amount of stuff. As an economist, I always believed a big part of the value of economics was studying ways to divide up a finite amount of stuff against greater demand.

This is called "rationing."

Health care is no exception to this. There aren't enough doctors, drugs, or MRI machines to go around for everyone to get as much as they want all the time. (This could be changed if society wanted to do so, but that is a different discussion).

So American society "rations" it. Currently, that rationing system says that if you're wealthy, you can have all the care you choose to buy. If you're extremely poor, you might be able to get an emergency room to help you...and if you can't cover the bill, the American taxpayer will pay. If you're in the middle, should anything remotely serious happen, you're going to get clobbered unless your employer offers insurance, and even then, you're only covered up to what they choose to provide.

As for the "choice" everyone supposedly has or wants, all those American workers covered by employer-provided plans generally don't get much choice, unless you think "this or nothing" is a good choice; or if a choice between "affordable but crappy insurance" and "you could theoretically have what you want, but in practice you can't pay for it" is a choice.

"Rationing" is a term thrown around to scare people. It conjures up images of nasty military food and extreme scarcity in times of war. See past the term and get to what's really being discussed - do you think the finite amount of healthcare should be simply up for sale to the highest bidder, and that cash should be the only criterion for distribution?

As a society, I think we can have an intellectually honest debate about whether health care is a basic human right or not (we can choose to be like some Third World countries and literally let people die in the streets) but that's a lot more personal, intense, and harder to fight against than "rationing".

Another point brought up frequently is that centralized systems like those of the UK or Canada, "the basics" (broken arms, shots, infections) are well-covered, but things like cancer or fanicer treatments are harder to get treatment for.

Guess what? You're probably only ever going to need "the basics". It's akin to owning terrible day-to-day clothes but 3 bitchen tuxedos. I think it's better to focus on covering most of what you need most of the time.

Framers of the debate are playing on people's emotions, their fears of serious diseases, and their lack of statistical understanding. It's shameful.

Most of the people in the debate are reacting from fear and emotion, rather than thinking about what they really need and what's best for everyone. That's nothing new, but I remain disappointed in the general public's ability to see past such blatant attempts at distortion and manipulation.

Over the last few years, I've interacted more closely with the insurance-medical complex. It's hardly been ideal, but I've managed to get the care I've needed, as have most people I know.

Insurance works on a simple principle: spread risk out over a large population. I suppose viewed through Tea-colored glasses it sounds "Socialist".

Perhaps this ultimately mirrors the larger sub rosa conversation going on in American society today: Would you prefer that you personally had the small opportunity to be very, very rich while everyone else is poor, or would you prefer we tried to lift everyone's quality of life a little bit?

The recent lottery hype provides all the answer one needs, sadly.

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