It's one of those areas where you can spend and spend and spend and you will still be far away from satisfying the needs we have.
The Danish model that I grew up with is ok, but don't expect treatment that are even half that of a good American hospital.
Put on top of that the fact that we are "discovering" (or inventing) more and more sickness that we can then threat which people expect the hospital to take care of.
Perhaps the real trick is to tax those treatments that are extremely both important and expensive and let the insurance companies take care of the milder forms of sickness. That way if technology makes what used to be expensive treatments easy and cheap they can be pushed into the private market.
Don't know, it's a tough nut to crack.
Nothing will change for those who are well off, but for those at the bottom it will be great.
The first 20% of heath care spending goes increasingly far. The last 20% is pure waste. The problem is people want to try and help the old live forever so medicare is a black hole that will suck this country dry. Unfortunately I don't think we are going to have a cap on spending if you have less than a 20% chance of being alive in one year.
PS: Want to make heath care cheaper pay for the first 100$ of any drug / month if and only if it has zero advertising.
But isn't this exactly the problem in the model?
Most people can't afford the high risk expensive treatments so you are basically just bankrupting them.
The expensive treatment is the treatment that we "really" need, but also that which is without reach for most of us.
By keeping the expensive treatment in the public domain as long as the private sector hasn't found a way to commodify it. So that people in general have access to it, seems to be a fair way of doing it.
If only the rich can afford treatments that are expensive you could might as well keep the old system.
I don't think many economists would claim that free markets offer a perfect solution regarding health care. Rather, they would argue that the alternatives (for example, a government run system) are worse.
It's not about government vs. private market, but about whether a society is willing to pay in solidarity with their peers for the less often but expensive and perhaps complicated procedures trough taxation.
Or whether they think that it is better to have a system where those who can afford get the best treatment and pay through their insurance.
IMHO a modern society finds a balance between what to lift collectively and what to make a personal responsibility. Not because it is moral just, but because it is financially a more useful model as long as it is to expensive to run through the private system.
But again, it's not black and white, there are many arguments for and against.
We get better health care in the US.
The US also subsidizes drug discovery for the rest of the world. In the late 90's, I worked for a company that made robots used for drug discovery. Every once in a while, they would put up a chart showing year over year growth. There was a healthy, steady climb until the Hillary health care initiative. The company almost went out of business. Drug companies froze spending on drug discovery because it wasn't worth their while to spend the hundreds of millions to bring a new drug to market if the US was going to go to a single-payer system. US drug prices pay for R&D, and all the countries with enforced pricing get a free ride.
If you compare the complex mess in the US to a simpler federal-based system, of course the simpler one looks better. However, remove all regulations and tax implications from the US and prices will dive bomb and quality will improve.
http://mjperry.blogspot.com/2008/07/cancer-survival-rates.ht...
US healthcare is not a pure market based system, though. The regulations make it very expensive.
- an expat Dane
I'm quite curious where it has even been attempted (I'm assuming that Krugman is aware that it's difficult to prove a negative). There are submarkets where markets are being tried - prescription eye glasses for instance.
There are all types of insurance that cover complicated risks as well - this doesn't mean they are uninsurable (excess of loss coverage on any variety of things). But I think Krugman's biggest failings is in making a convincing argument that all healthcare is necessarily expensive. Back to the prescription eyeglass example - where the competition between opticians, optometrists and ophthalmologists have made costs rise considerably less than healthcare costs as a whole. Further, if you look at the innovations in ambulatory care centers, there have been dramatic reductions in costs.
Finally, let's also be reasonable about government run healthcare that has its own set of issues with spiraling costs and often lower standards of care. As a Canadian, you often see the effects of rationing - ie people wait. People die in the waiting line. The system is still quite expensive and is set to become even more so given demographics. It is however an interesting debate - where I worry though is given the US is the dominant innovator in healthcare, will the tinkerings to how and what incentives are offered dramatically reduce innovation? Despite being an obviously imperfect system (which one is perfect for that matter?), most Americans at least say they are satisfied with their own healthcare insurance. Are these really then acceptable tradeoffs to move to a largely government run system - especially given the level of competence we have seen them run the recent stimulus packages?
I'm not sure that healthcare costs will necessarily increase over time - there are some pretty stunning developments in area of ambulatory care with dramatic savings for insurers (not to mention improvements in quality of care at the same time).
This is easy to refute.
Flash back 100 years. People had healthcare they received from a family doctor. Insurance was non-existent, and the free market reigned.
In fact, it was the success of the free market in healthcare that led -- and continues to lead -- for more and more complicated, expensive treatments that save more and more lives.
I see three problems with markets and healthcare:
1) Insurance policies are so obfuscated that nobody understands what they are buying. Government needs to step in here and create standard insurance policy baselines. This will allow me to make an informed decision.
2) The people receiving healthcare have little or no input into cost control -- the people controlling costs have no "skin in the game" when it comes to value and quality of care. This decoupling needs to be fixed to encourage individuals to monitor and control their own costs.
3) If society has a greater interest in making sure there is a basic level of healthcare for all, as it does with say automotive insurance, then it should be a law for all people to have personal health insurance that covers these catastrophic scenarios. This would also mean allowing all insurance to be tax deductable and decoupling insurance completely from employers. It should be completely portable and associated just with the person.
Compared to some of the huge plans I've seen, these are really easy to describe. A bill could be just a couple of pages, and most Americans could understand exactly what is being passed. Instead of trying to have one huge law "fix" the problem, it simply provides some definitions and takes one huge problem and breaks it up into hundreds of millions of little problems that can be solved various ways.
Why we continue to think that some legislative body can create gargantuan one-size-fits-all solutions is beyond me. Evolution, machine learning, market theory, chaos -- lots of real, hard science says that solutions are iterative, incremental, and adaptive. Not complex and static.
There's no point at which the average person with a reasonable prognosis for even 1 more year of life says "gee, that sounds expensive, perhaps I should just die instead, so as to control my own cost to society [or my insurance company]."
If I'm sick, I want to be made better. If I have cancer, I want it cured, etc.
I completely agree that if you have a life-threatening illness cost is not an option. But as a healthy young-person, when I get a cold or something I just take some aspirin and wait to get better. Same goes for ear infections. There is a lot of room for flex in how people get treatment for non-life-threatening illnesses. What the stats show is that the less skin in the game people have, the more likely they are to go to the emergency room for things like common colds.
