Tuesday, January 29, 2013

Catastrophic Care: A Serious Problem and an Economism-Restricted Answer

            A colleague of mine asked my opinion about a recent article in The Guardian newspaper in the UK, reporting the appearance of a book by David Goldhill, Catastrophic Care: How American Health Care Killed My Father—and How We Can Fix It:

As I did not have time to acquire and read the book, I turned instead to the article Goldhill wrote for the Atlantic Monthly in 2009, which appears to have been a brief synopsis of what the book contains:

Goldhill is a businessman, as he tells us, and not a health policy expert. So when his 83-year-old father died after being admitted to the hospital with pneumonia, spending 5 weeks in the ICU and getting complicating infections one after the other, despite what seemed to be smart and compassionate physician and nursing care, Goldhill went to work trying to figure out for himself what was wrong with this system. First he made a catalog of all that he found wrong with the way US health care is organized; then he proposed a solution that seemed to make sense to him as a businessman. His assessment of the problem is largely on target, so I want to talk only about his solution, which shows what happens when we put on the blinders of economism.

Briefly, Goldhill favors a system where we’d each buy (or be given by the government if we were too poor to afford it) a health savings account to manage predictable, normal health expenses, plus a catastrophic insurance policy to cover unforeseen emergencies. This is basically the health savings account idea as its advocates call for it today. He’s sure that if we restored the consumer to the driver’s seat, we’d have a system that actually responded to consumer needs and no longer wasted huge sums of money while providing unnecessary or error-ridden “care.”

An obvious rejoinder is, first, that this assumes that health care can be tamed by a healthy dose of free market competition, while smart economists ever since Kenneth Arrow back in the 1950s have piled up lots of reasons why the market will not and cannot work in health care. Second, while errors and hospital-acquired infections are too-common problems all over the world, most other countries control costs much better than we do, yet none of them has found the health savings account, or the consumer-driven model, the right way to do this. So Goldhill needs to explain why the US is such an exceptional case.

Goldhill’s article in The Atlantic in fact mentions the existence of any country besides the US only twice.  He briefly considers the pros and cons of a single-payer health system, but decides it’s no good, first, because it would be “Medicare for all” and Medicare has been unable to control costs effectively (which might be precisely because Medicare is not the only game in town, and could control costs much better if it were). Second, he notes that the health costs have been rising in other nations and not just in the US. That’s true, but the steepness of the curve is generally less in those other countries, again showing that a single-payer system does not merely lead to administrative efficiency savings; it also gives the health system leverage over prices generally in a way that can constrain costs more effectively than our patchwork nonsystem.

The only other place he mentions any other nation is to note that the US has a lot more MRI scanners than countries like Germany—only to go immediately to the conclusion that more free-market competition in the US would take care of that.

This article is a good example of how one can do a reasonable job of deciding that a problem exists and why; and yet be so severely constrained by economism as a belief system that one cannot see anything like a wide range of solutions. (Since Goldhill is obviously suspicious of the US health insurance industry, you’d think he’d also be suspicious of the idea of health savings accounts—since the only people pushing them are conservative-economism ideologues, and lobbyists for the big insurers who know they can make a mint off HSAs.)

If you’ve been following this blog, you might imagine that I’m simply beating up again on Republicans. So I should add that Goldhill admits in his article to being a Democrat. Economism, it seems, is a bipartisan affliction.

1 comment:

  1. Thanks! I read the article when it appeared and found it both superficial and annoying. So glad to see your analysis!