Universal Health Care

[Headless Thompson Gunner]

If you believe that capitation, one among many others, is only a pseudo problem, then your idea of reality and fantasy deserve closer scrutiny.

I hope your insurance plan has a good psych rider.

Capitation is an attempt to make an end run around the root problem of incentives.  It won't work.  Like any other attempt at realigning the incentives involved, it will only lead to rising prices.  It's not much of a problem, though.  Eventually capitation costs will rise to the point where capitation ceases to be a viable alternative.  They'll stop using it and maybe try some other ineffective scheme to ignore the misaligned incentives at play here.

[De Selby]

Capitation is an attempt to make an end run around the root problem of incentives.  It won't work.  Like any other attempt at realigning the incentives involved, it will only lead to rising prices.  It's not much of a problem, though.  Eventually capitation costs will rise to the point where capitation ceases to be a viable alternative.  They'll stop using it and maybe try some other ineffective scheme to ignore the misaligned incentives at play here.

Question:  If screwing with the incentives drives up the price, how come the exact same medical service is cheaper in many communist-health systems by several multiples of dollars for private purchasers?

How did they manage that in these state-managed healthcare systems?  I mean, you'd think if the prices go up, it would be way, way more expensive to take a flight to Singapore and get back surgery done than to stay in the US....but generally it costs double digit amounts less.

Can anyone explain that?
http://www.marketwatch.com/news/story/Medical-Tourism-Are-Major-Changes/story.aspx?guid=%7B6460049D-D037-434C-8DE0-5E87C11955E8%7D

"While there are many factors to consider," states Look, "cost seems to be the biggest. It's easy to see the draw ... when a heart bypass procedure that costs $130,000 in the U.S. can be done at an accredited hospital in Singapore for $18,500 or in India for $10,000, for example."

Odd...it looks like hundreds of thousands of people are leaving the U.S. every year to obtain care, yet the rumor is that actually people are coming from all over the world because it's so great in the U.S.  Apparently the socialist paradises must have some draw for people who are sick.

[Headless Thompson Gunner]

The puzzling thing is this:  per capita, the US spends way more on healthcare than any other country in the world.  Yet, other countries manage to cover the entire population, and receive equivalent per capita levels of service and amounts of service.

So even though were we to simply copy one of the socialist medicine systems, it would cost less per person and we'd receive basically the same care, that's a horrible thing because....it's against freedom.

The congressional study you linked earlier seems to claim that other countries spend less on health care and receive comparable quality of care.  But I don't buy it.  Quality of care is a qualitative concept, not a quantitative concept that can be measured and tabulated.

If the quality of care in the other socialize medicine countries were really comparable, then foreigners wouldn't travel to the US to receive our care like they do.

Studies like the one you posted mighty be able to catalog the number of doctor visits per capita per year, or the number of hospital or ER visits per year, and so forth.  But they can't accurately divine differences in quality of care.  There are differences, surely. 

An "accredited hospital in Singapore" isn't necessarily as good as a hospital in America, and it's foolish to assume they are.  But in a study they'd be assumed to be equal. 

Then, of course, there's the issue of people who have access to socialized medicine choosing to go outside the government system for their care.  Australia's system has been held up as a model.  Nevermind the long waiting times, nevermind the concerns that the system is underfunded and slowing bleeding itself dry.  The fact half of Australians choose to buy private health insurance rather than use the free government coverage ought to tell us something about the desirability of government coverage.  I hear similar stories from other European social medicine countries.  Those who can tend buy private health care rather than use the public services.

So what's to say we don't adopt the same socialist system here, and end up with the same problems we've always had?  Those with the means will still end up buying superior care out of pocket, which is exactly what we all do now.  Those without the means will still end up using the free services provided to the public, just like they do now.  It doesn't solve anything.

[Headless Thompson Gunner]

Question:  If screwing with the incentives drives up the price, how come the exact same medical service is cheaper in many communist-health systems by several multiples of dollars for private purchasers?

Because there are government mandated prices.  The services are not exactly the same, either, but that's a subject I've already touched on.

It is entirely possible for government to force prices down by fiat.  That's what they do in most of the industrialized world with their social medicine programs.  But as any economics student knows, price caps cause shortages.  That's the reason why most procedure have long wait times in foriegn countries but not here.

It goes back to the problem of limited resources.  There are only so many operating rooms and surgeons and nurses in the country.  Their use will be allocated in some fashion.  If it isn't done inherently by means of prices, then it'll be done by some form of rationing (price caps, waiting lists, service limits, reduced quality of care, and so forth).

[De Selby]

Because there are government mandated prices.  The services are not exactly the same, either, but that's a subject I've already touched on.

Except that those aren't government mandated prices-that's the private hospital cost for a foreigner, who has no health care rights in Singapore.

The rest of your post is centered on that, but it is inaccurate-the prices for medical tourism generally are a free for all; this is the price range for a private hospital, that solicits patients privately and can charge whatever it wants. 

[BridgeRunner]

Odd.  

Poor people can't expect the same level of care as well-off people.  No one deserves steak on a hamburger budget.

However,

We have the bestest most expensivest awesomest healthcare in the world, people with the resources come from all over to partake of our wonderful expensive healthcare, and that shouldn't change.

Ok...

So, what do the people with a hamburger budget do?  For that pricey surgery, maybe they go to Singapore, if they have the resources to travel.  What do they do for the minor procedures, the ones that take fifteen minutes and minimal staff/drugs/facilities, but still costs thousands in the US?  What do they do about the drugs that osts double here what they do elsewhere?  What do they do for emergency conditions?  What do they do when there is no hamburger option available?

[De Selby]

So what's to say we don't adopt the same socialist system here, and end up with the same problems we've always had?  Those with the means will still end up buying superior care out of pocket, which is exactly what we all do now.  Those without the means will still end up using the free services provided to the public, just like they do now.  It doesn't solve anything.

It doesn't solve anything except the price: Those who buy private insurance pay less, and receive the same care, and the public cost of providing healthcare to the poor is lower as well.

That is a solution: everyone gets treatment, and everyone pays a lot less.

The only sense in which it is not a solution is from the perspective of ideological commitment to a particular system, regardless of costs and benefits.  I think you basically just ignore the actual numbers because that's not relevant; all that's relevant is that the system comports to your ideology.

[Headless Thompson Gunner]

Except that those aren't government mandated prices-that's the private hospital cost for a foreigner, who has no health care rights in Singapore.

The rest of your post is centered on that, but it is inaccurate-the prices for medical tourism generally are a free for all; this is the price range for a private hospital, that solicits patients privately and can charge whatever it wants. 

Perhaps you need to be more specific about just which country you're asking me about, then.  Earlier you quoted Singapore, and all along we've been talking about industrialized Western social medicine countries.  You brought up communist health systems in there somehwere, too.

So, which is it we're talking about?

I had assumed we were still talking about the industrial, Western nations with socialized medicine.  Australia and the Canada and the UK and so forth.  I believe that all of those countries do use government price fixing, with the inevitable results.

If we're talking about Singapore, then the answer is one of cost-of-living.  Everything tends to cost less in poorer countries.  Wages are lower, the public's buying power is less, local currency and exchange rates are favorable to us, and so forth.  It doesn't take much for a Westerner to walk into a place like Singapore and outbid the local population for whatever services he wants.

[Headless Thompson Gunner]

So, what do the people with a hamburger budget do?  For that pricey surgery, maybe they go to Singapore, if they have the resources to travel.  What do they do for the minor procedures, the ones that take fifteen minutes and minimal staff/drugs/facilities, but still costs thousands in the US?  What do they do about the drugs that osts double here what they do elsewhere?  What do they do for emergency conditions?  What do they do when there is no hamburger option available?

If it were up to me there'd be hamburger budget options available here.  Our system isn't set up to allow that.  There isn't much demand for it, either.  I feel like a broken record, but it gets back to a problem of incentives. 

When someone else is footing the bill for you (and in our system, someone else is almost always footing the bill for you), then you and your doctor have no incentive to come up with a hamburger solution.  You end up using the steak solution and charging it off to whoever else is paying.  And why not?  It costs you nothing.

These constant attempts to relieve the patient from the burden of paying for his care will ALWAYS tend to remove hamburger level solutions.  Government care, the ultimate "pay it for me" system, will only exacerbate this problem.  It will exacerbate the problem to the point that some sort of rationing becomes necessary, and with that come a myriad of other problems that are even worse.

[De Selby]

So, which is it we're talking about?

Take your pick and it's cheaper-that was sort of the point.  There isn't any in the list that has higher private medical care costs than the United States.  Referring to them as "communist" was simply a reaction to your ideology of "freedom"-by communist, I mean the public healthcare systems available in every industrialized country in the world besides the United States.

If we're talking about Singapore, then the answer is one of cost-of-living.  Everything tends to cost less in poorer countries.  Wages are lower, the public's buying power is less, local currency and exchange rates are favorable to us, and so forth.  It doesn't take much for a Westerner to walk into a place like Singapore and outbid the local population for whatever services he wants.

Well, Singapore in particular is basically a giant mall with Armani/Prada stores, so I think the average westerner will have a hard time completely outbidding the local population.  Rolex and Cartier are popular there too-fairly comparable to American prices, sometimes a decent deal to be had, sometimes not.

But with medical care...how is it that they provide hospitals, doctors, the same equipment and medicines, and then the service for $90,000 less??? That's a bit well outside of the exchange rate and well outside the respective differences in cost of living.

See, it looks like what you're doing is simply ignoring the facts, because they aren't important.  Lower cost and higher efficiency isn't an issue, just so long as you and your parents are paying for your care and no one else.

[De Selby]

If it were up to me there'd be hamburger budget options available here.  Our system isn't set up to allow that.  There isn't much demand for it, either.  I feel like a broken record, but it gets back to a problem of incentives. 

40 million people with no insurance doesn't create enough demand for cheap services??? 

[cassandra and sara's daddy]

The congressional study you linked earlier seems to claim that other countries spend less on health care and receive comparable quality of care.  But I don't buy it.  Quality of care is a qualitative concept, not a quantitative concept that can be measured and tabulated.

If the quality of care in the other socialize medicine countries were really comparable, then foreigners wouldn't travel to the US to receive our care like they do.

Studies like the one you posted mighty be able to catalog the number of doctor visits per capita per year, or the number of hospital or ER visits per year, and so forth.  But they can't accurately divine differences in quality of care.  There are differences, surely. 

An "accredited hospital in Singapore" isn't necessarily as good as a hospital in America, and it's foolish to assume they are.  But in a study they'd be assumed to be equal. 

Then, of course, there's the issue of people who have access to socialized medicine choosing to go outside the government system for their care.  Australia's system has been held up as a model.  Nevermind the long waiting times, nevermind the concerns that the system is underfunded and slowing bleeding itself dry.  The fact half of Australians choose to buy private health insurance rather than use the free government coverage ought to tell us something about the desirability of government coverage.  I hear similar stories from other European social medicine countries.  Those who can tend buy private health care rather than use the public services.

So what's to say we don't adopt the same socialist system here, and end up with the same problems we've always had?  Those with the means will still end up buying superior care out of pocket, which is exactly what we all do now.  Those without the means will still end up using the free services provided to the public, just like they do now.  It doesn't solve anything.

as far back as late 70's folks went overseas for treatment. interestingly enough some of these treatments were pioneered/ developed in the usa but couldn't get fda approval. (read lobbyists failed)  

[Headless Thompson Gunner]

40 million people with no insurance doesn't create enough demand for cheap services??? 

You can't use the fact that someone doesn't have something as proof that they want it.  If anything, assuming the opposite would make far more sense.

Fact is, a good many of those 40 million uninsured people are uninsured by their own choice.  There are plenty of reasons why folks decline to make health insurance a priority. 

[cassandra and sara's daddy]

http://www.minatokuishikai.or.jp/eng/basic/bas_home.htm

heres how they do it in japan

[BridgeRunner]

Fact is, a good many of those 40 million uninsured people are uninsured by their own choice.  There are plenty of reasons why folks decline to make health insurance a priority. 

Reason #1

It sucks paying $400-1000/month for a product one cannot afford to use, and which fails to serve its intended purpose.

[AZRedhawk44]

Reason #1

It sucks paying $400-1000/month for a product one cannot afford to use, and which fails to serve its intended purpose.

Yes... much more convenient to have the government run an insurance plan, give my employer incentive to cancel my perfectly good plan, increase my taxes and give me worse insurance with less take home money.

Shootinstudent:  Communist state healthcare is cheap because they don't do any research in pharmaceuticals or surgery there.  They do it here.

You make here socialist in the same way and no more research will get done.  There's just no incentive if people won't pay for the research to be lucrative to the innovator.

[Headless Thompson Gunner]

Regarding Singapore's health care system, a quick google search turned up this link:
Singapore's Health Care System: A Free Lunch You Can Sink Your Teeth Into

How does Singapore do it? Singapore is no libertarian health care paradise, but it does self-consciously try to maintain good incentives by narrowly tailoring its departures from laissez-faire:

Golly, there's that 'i' word.

Singapore shows that the free lunch offered by greater government control is meager compared to the free lunch offered by old-fashioned individual incentives.

Whoa!  There's that 'i' word yet again.

Now, where have I hear that 'i' word in this thread?

Oh yeah!  I've been harping on the concept of incentives all a-freaking-long.

So, it seems that the reason Singapore's health care costs so much less is because they've managed to align the incentives properly.  

Even for the poor, government only pays up to 80% of the charges.  That gives patients a strong incentive to minimize the costs they incur.  

Each hospital is required to publish their prices, to allow comparison shopping between doctors and hospitals.  This gives docs and hospitals strong incentive to keep their prices down.

The government provides low-cost major medical insurance, and competes against private insurers for the same.  That gives both parties incentive to keep their costs in line.

Everyone is required to save a portion of their income specifically for use in your own health care.  When you buy health care, you're spending your own money.  That gives you a strong incentive to economize.

It's an interesting system.  It seems to have been designed by someone who had an inkling of basic economics.  The results are predictable.

[cassandra and sara's daddy]

Communist state healthcare is cheap because they don't do any research in pharmaceuticals or surgery there.  They do it here.

true once  no longer the case

[De Selby]

Headless,

So you'd support just copying the Singaporean system?  Or is that 80 percent payment too communist despite the results?

It seems like now what you're doing is relabelling the least socialist system as a market based one, and then concluding that the U.S. must be more efficient since it's even more privatized.  But obviously that's not the case.  Your ideology is confusing your analysis.

AZredhawk,

Medical research is done all over the world-Australia is a major hub for it.  State health care didn't kill it here, and won't elsewhere.

Indeed, a good chunk of the research in America is state funded in the first place.

[cassandra and sara's daddy]

Indeed, a good chunk of the research in America is state funded in the first place.

if you consider the gov funded schools it goes on at most of it is subsidized

[Headless Thompson Gunner]

Headless,

So you'd support just copying the Singaporean system?  Or is that 80 percent payment too communist despite the results?

It seems like now what you're doing is relabelling the least socialist system as a market based one, and then concluding that the U.S. must be more efficient since it's even more privatized.  But obviously that's not the case.  Your ideology is confusing your analysis.

You're not making sense.  The least socialist system (if by that you mean Singapore) employs a mostly market-based approach.  There's no need to re-label it.  There is plenty of government intrusion, which I don't like, but at least they intrude in minimal and  sensible ways.  They haven't adopted the dirt stupid universal health care systems that the rest of the industrialized world adopted, and which we in the US are desperately trying to avoid.

The Singapore government will pay 80% of your care only if you're poor.  If you don't meet their strict needs test, they don't pay a dime.  Even if you do qualify for government-paid care, you're still responsible for 20% of every cost you incur. 

They keep costs in line by means of competition.  That's the answer to BridgeWalker's question about hamburger vs steak care.  In Singapore you have both options, steak-level care or hamburger-level are, with prices published publicly so that everyone can see what they're getting before they get it.  It's easy to choose one over the other.

In Singapore they seem to use insurance intelligently.  They use it for major medical costs, not for routine care.  Insurance doesn't save anyone any money if claims are common and frequent.  Insurance only works if it's used to average infrequent risks over many people.

I found another interesting link on Singapore's health care system:
The Singapore health system – achieving positive health outcomes with low expenditure

What can be learned from the Singapore health care system?

The key to Singapore’s efficient health care system is in its emphasis on the individual to make a significant contribution towards their own healthcare costs. With this focus, the Government has been able to maintain a relatively low level of public expenditure on health for many years with the major burden put on individuals and/or their employers.

Golly, personal responsibility actually works!  Not only that, it works without relying upon primarily upon the government.

I would take Singapore's health care system over Europe's in a heartbeat.  There are minor details I don't like about it, but they've got the big picture right.  They use price competition to force costs down.  They give patients and doctors strong incentive to keep costs down and to minimize the resources consumed.  They use personal savings (mandated personal savings, but still personal) to cover routine costs, and they use major medical coverage to handle the big expenses.

Singapore is definitely a step in the right direction.  Universal health care a la UK or Australia is a step in the wrong direction.

[cassandra and sara's daddy]

was there hidden in there an explanation of why its so much cheaper there? i missed it

[ronnyreagan]

Quality of care is a qualitative concept, not a quantitative concept that can be measured and tabulated.

If the quality of care in the other socialize medicine countries were really comparable, then foreigners wouldn't travel to the US to receive our care like they do.

Studies like the one you posted mighty be able to catalog the number of doctor visits per capita per year, or the number of hospital or ER visits per year, and so forth.  But they can't accurately divine differences in quality of care.  There are differences, surely.

So there's no possible way to determine if one system is doing a better job than another? Life expectancy, fewer unmet needs, and lower infant mortality (which we fall behind most UHC countries in) are totally meaningless? The US spends more per person, and is less healthy by most metrics. You can't just disregard those metrics because they don't agree with you. Do you care to provide any metrics other than your gut instinct or anecdotes that that show UHC care is worse?

[De Selby]

Me too, cassandra and sara's daddy.

The odd thing is, you're taking a system which pays out tons of government money (80 percent for the poor, with a fund to pay for people who can't afford the 20), taxes income to pay for healthcare (that's what "mandated savings" is-a tax on income), and then pays out government regulated rates on major medical (just like medicare)....and yet a heart surgery is about $90,000 cheaper.

[Headless Thompson Gunner]

So there's no possible way to determine if one system is doing a better job than another? Life expectancy, fewer unmet needs, and lower infant mortality (which we fall behind most UHC countries in) are totally meaningless? The US spends more per person, and is less healthy by most metrics. You can't just disregard those metrics because they don't agree with you. Do you care to provide any metrics other than your gut instinct or anecdotes that that show UHC care is worse?

Illogical argument.  Correlation without causation.

The US is indeed less healthy than most UHC countries.  But that isn't because we lack UHC.  It's because we're less healthy.