Tag: Health Care

Dispatches from a Life-Long Government Employee and Conservative

 

One of the common themes on the right is that the government cannot do anything right, that government programs are wasteful and that they always provide poor services. There are many examples to point at, such as the VA, Public Schools, and the like. The general attitude is that government workers are lazy, have poor attitudes, and are generally no good.

I would like offer a counter to the conservative write off of all government workers and programs. This is not to say there are not many things that need to be trimmed. It is to say that blanket statements might not be accurate. Let me start with what my organization does.

Richard Epstein responds to the recent controversy over sharp increases in the price of EpiPens and explains the economic dynamics underpinning the larger debate about prescription drug costs.

On Fairness in Canadian Healthcare

 

shutterstock_249846172-e1453904472642I’m a week into my first trip to North America since 2011, and the first time I’ve been to Canada since my childhood. I’ve been visiting a famous Canadian healthcare complex and have been struck by a few things as an Aussie. I’m impressed by the professionalism of my colleagues and the standard of the technology being used to treat patients surgically. I am also struck by the fact that all the doctors I have spoken to are harshly critical of Canadian healthcare as it stands, and think that some kind of reform or change is needed.

Australia, like Canada, has universal healthcare but the similarity ends with this sentence. If you don’t like the waiting time, or the options presented to you, or your physician, or even just the decor of the public hospital in Australia, in most cases one can obtain the same service from a private doctor or hospital. In fact, once can choose to see the same surgeon from the public hospital in a private setting, if one wants. This usually comes at a price, but is always faster, and often in a “nicer” institution. None of that can happen if you are a patient in Canada, by law, because “fairness” and “equality.”

Fairness and equality as enshrined in the Canada Health Act make it illegal in that nation for a patient to be billed privately for medical treatment that is already covered by the public system. Physicians are also barred from providing both public and private health care. This was all very well thought out and designed by the left-leaning Liberal Party and enshrined into law by their majority government in 1984. (Message: Elections matter.)

The Curious Cost of Preventing Rabies

 

RaccoonI was reading the news this morning and came across this item: How rabies is suddenly on the rise in Canada. (A hitchhiking raccoon, apparently.) When I got to the last paragraph, I saw something I didn’t understand:

Plenty of Canadians are bitten by rabid animals each year, of course, but they are usually saved by a $1,500 (post-exposure) injection of rabies immunoglobulin. If the injection is given before symptoms arise, it is universally effective at stopping the infection.

1,500 Canadian dollars? That’s about USD 1063,87. That’s really expensive.

Europe, the United States, and Social Spending

 

I often read on Ricochet that conservatives don’t want a Western-European style social welfare state. What many don’t seem fully to appreciate is that we already have one.

Ryan McMaken’s interesting analysis, for example, appeals to the OECD’s definition: “Social expenditures” are those that have the purpose of redistributing resources from one group to another to serve social policy goals. In the US, he notes, Social Security is considered a public expenditure because it is spent, directly, by a government agency.

On Free Lunches and the Government Mandating Benefits

 

shutterstock_201202373_free_lunchMandating companies pay this or that benefit may seem like a free lunch to policymakers. Workers are helped, and taxpayers don’t bear the burden. Yet as Larry Summers wrote in “Some Simple Economics of Mandated Benefits” back in 1989: “If policymakers fail to recognize the costs of mandated benefits because they do not appear in the government budget, then mandated benefit programs could lead to excessive spending on social programs. There is no sense in which benefits become ‘free’ just because the government mandates that employers offer them to workers. … Mandated benefit programs can work against the interests of those who most require the benefit being offered.”

The Economist looks at this issue, in the context of part-timers, freelancers, and independent contract. Gig economy alert!

The main benefits associated with employment fall into three broad categories: public pensions, health care, and unemployment insurance. In the case of pensions, governments usually levy payroll taxes on firms in proportion to their workforce, and use the proceeds to support pensioners. Hire a worker as a contractor, and firms need not pay the levy; in America, the self-employed must instead pay it themselves. Workers’ advocates claim this means contractors face higher tax rates than employees.

Member Post

 

I’m sitting in my study, reading for school. I love my study with it’s bay window, high ceilings, and French doors. It’s the perfect place to shut out four-legged distractions and get some school work done. This evening, however, the charm of my study was diminished by the horrible thing I read in my textbook. […]

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Two Things to Remember About Health Care Policy

 

0fc53_doctor_bill0906235When trying to formulate a logical, humane health care system, the key is to start from this fundamental understanding: In our wealthy Western countries, we’re not going to let people die in the streets because they can’t afford readily available health care treatments.

Since everyone knows we aren’t going to turn people away from emergency rooms, a completely free market won’t work. The free rider problem is insurmountable. People can and will choose not to participate in the market until they become sick, and they will then rely on the good will of society to care for them. So the government will be involved in the health care delivery system in some way. Given the free rider problem, it should do so realistically: It should help people at the bottom while keeping government distortion of the market to a minimum.

third-party-2The next thing to consider is the big question: Why is health care so expensive? There’s widespread agreement that third-party payment through insurers is the main problem. There’s no cost control, because neither doctors nor their patients have any incentive to control costs. The only way to gain control over costs is to increase bureaucratic oversight – which adds to the cost.

How Much is Your Life Worth?

 

shutterstock_68146432When I ran for Congress in the special election in 2013 in Massachusetts, I would tell audiences that my children’s life expectancy dropped by 10 years on the day that ObamaCare was signed into law. When I made that claim at a League of Women Voters debate featuring seven Democrats and one Republican (me), there was widespread chortling … not to mention some outrage and ridicule from my fellow candidates.

If you listen to National Public Radio as I do (I recommend it: it’s painful but also cathartic), you will probably know that Boston-based biotechnology firm Vertex is in the crosshairs of the mainstream Left because they are charging $275,000 per year, per patient for a drug that shows remarkable success in forestalling the lethal effects of cystic fibrosis. Also recently, a group of oncologists at a Mayo Clinic conference released an editorial excoriating “Big Pharma” for charging too much for cancer-fighting drugs. According to the blog ThinkProgress:

In the editorial, Tefferi [the lead author] and his colleagues call for several policy changes to help address the problem. They say the United States should establish a new regulatory body to help set drug prices after new medications are approved for the market, as well as allow cheaper drugs to be imported from other countries like Canada. They also recommend allowing Medicare to negotiate directly with pharmaceutical companies, which could help the government program use its bargaining power to demand lower prices.

Silver Linings of King v. Burwell

 

SCOTUSCloudsConvention claims the Supreme Court’s King v. Burwell decision is a loss for conservatives. But Democrats shouldn’t celebrate. Politically, it’s a win for the Right, skirting potential harm in terms of legal precedent as well as improving positioning for 2016.

Many viewed the chief precedential purpose of the case as the establishment of clear limits on administrative overreach. The potential downside was a further removal of those limits. Accordingly, the initial announcement of the ruling led to collective concern that the court had followed the court of appeals and expanded “Chevron deference,” the controversial doctrine that essentially holds that courts should defer to executive branch interpretation of statues, even if such interpretations effectively revise the law as written by Congress.

But the court didn’t sanction such administrative overreach in the King ruling. Instead it said that when Congress wrote “state” it really meant “state or federal.” That is, it said the IRS was correctly interpreting the law, rather than deferring to a reinterpretation.

Worse Than the Supremes: Obamacare Economics

 

shutterstock_154183430The judicial decision to uphold all of the president’s health care subsidies may be very disappointing, but the economics of Obamacare are far worse than whatever constitutional mistakes have been committed by the Supreme Court.

The economics of Obamacare are very bad. The law is inflicting broad damage on job creation and new business formation. It ruins job incentives by making it pay more not to work, thereby intensifying a labor shortage that is holding back growth and in turn lowering incomes and spending.

And across-the-board Obamacare tax increases are inflicting heavy punishment on investment — right when the U.S. economy desperately needs more capital as a way of solving a steep productivity decline.

ObamaCare Subsidies Are So Important the Government Forgot to Keep Track of Them

 
20130104-joker-burning-money
Inside the Centers for Medicare and Medicaid Services

Last week, I filed a blog post about the looming Supreme Court decision on the case King v. Burwell. The case will determine the legality of billions of dollars worth of subsidies handed out to customers on the federal health insurance exchange under the Affordable Care Act (ACA). In short, I argued that we shouldn’t weep if the subsidies are struck down. By their very nature, subsidies put upward pressure on prices because they essentially guarantee a level of revenue for the subsidized industry. The higher education system was the example I offered, where we’ve seen tuition prices rise faster than any other sector of the economy, even outpacing healthcare inflation. Ridding the insurance market of subsidies would therefore actually be a step forward towards “affordable” care in the long term, despite some undeniable short-term disruptions that would result.

Want to Get Rid of Obamacare? Then Don’t Repeal the Medical Device Tax

 

shutterstock_143224918American voters, wanting relief from Obamacare, fired many of the Democrat Senators who rammed it through Congress. That lesson doesn’t matter nearly as much to some senators as the $30 million spent by medical device makers trying to repeal the specific Obamacare tax applied to them. The device makers—who didn’t oppose passage of the Affordable Care Act—are now poised to get preferential treatment in the proposed Senate Republican budget. Their industry may cut to the front of the line for legislative relief, while the citizens who are paying some $300 billion in ACA taxes will have to wait. And wait. And wait.

Dean Clancy, a former medical device maker executive and a health policy expert writes about it here, and grassroots advocate Ken Hoagland writes about it here. This is the beginning of a pattern. Next in line are the insurance companies, with legislation to repeal an onerous tax they don’t like.

There may be automatic sympathy for tax cuts on the right. But repealing the medical device tax now is inane if you are serious about wanting to repeal the Affordable Care Act. These are corporate interests who won’t be around for a 2017 repeal/replace fight that benefits everyone if they’ve already solved their own problems. Indeed, some of them might then be on the wrong side in 2017.

What Justice Kennedy Got Wrong in the Obamacare Oral Arguments

 

In my new piece for Defining Ideas from the Hoover Institution, I’m taking readers through the Supreme Court’s oral arguments last week in the case of King v. Burwell, which will decide the fate of Obamacare subsidies in states that are serviced by a federal health insurance exchange. (I also covered this topic at length in Libertarian podcast with Troy Senik last week.) As I note there, perhaps the most inventive (and alarming) argument of the day came courtesy of Justice Anthony Kennedy:

In one sense the most novel argument of the day was an ill-thought-out suggestion by Justice Anthony Kennedy that the ACA might be unconstitutional if it were read to deny subsidies to health care policies purchased on the federal exchanges. Justice Kennedy never bothered to state whether his suggestion would require invalidation of the entire statute, or the creation of a massive subsidy that Congress itself had never authorized. There is, fortunately, no need to choose between these two unappetizing alternatives. Kennedy tossed off an argument that no one ever raised throughout the litigation: the denial of the federal subsidies would coerce individual states to set up exchanges in order to benefit their citizens.

A Bomb I’m Throwing At My Health Policy Class

 

shutterstock_228600766For our first discussion assignment in my “Nursing 614: Healthcare Leadership, Policy, Politics, and Ethics,” I am making the following statement:

To preserve my own intellectual honesty, I would like to challenge the supposition of this entire field of academic study. Namely that it is somehow the role of central planners, policy makers, or government officials to improve the health of any population or individual. Our modern system of socializing the costs of healthcare creates stakeholders in private personal and economic behaviors that otherwise have no natural interests in these areas. Private behavior should be just that: private. Like all things, healthcare choices of individuals are based on a complex web of tradeoffs and assessments of relative value. There is no fundamental reason any government should be involved in this assessment outside the aforementioned current payment system.

Thoughts?

Capitalist Heath Care For Everyone

 

shutterstock_155901572For thousands of years, the question of healthcare has been basically irrelevant. If you got seriously ill, your death or survival — usually the former — had little to do with how much care you received, and it didn’t matter if you were the King of England or an American slave. People may have thought healthcare was important, but it didn’t really matter; environmental factors such as general health and diet, shelter, and workload mattered much more. To put it in perspective, most of us can count how many times we would have already died had we lived 150 years ago. For me, the score is two: I’ve had appendicitis and bacterial pneumonia so bad I was coughing blood. Neither was tremendously problematic or fearsome.

Because we’ve made such remarkable progress, healthcare matters. That progress is broadly the result of two things. The first is evidence-based medicine. In the late 1800s, somebody did a study and realized that outcomes were no better if you went to a doctor for treatment. That didn’t speak well for doctors. More recent studies have shown the same thing for Medicaid: outcomes are better for people who are totally uninsured rather than for those on Medicaid.

The second is market-based incentives. Here is an examination of health care innovation since World War II (after which, many countries nationalized care). Of 22 major advances, 17 were first applied in the U.S., four occurred in mixed public-private healthcare markets, and one occurred in a fully nationalized market (the artificial cardiac pacemaker). It’s safe to say that — absent free markets — we wouldn’t be debating health care as public policy because there’d be nothing worth arguing over.