Yet Another Reason for Universal Health Insurance
| Fri Mar. 23, 2007 2:49 PM PDT
California's Department of Managed Health Care randomly selected 90 (of more than 1,000) cancelled individual Blue Cross plans and investigated whether the company had cause to cancel them. Score: 0 for 90. Blue Cross broke the rules in every single case.
The policies were individually purchased plans in which policy holders had become pregnant or sick, apparently triggering Blue Cross to rescind the policy. Retroactively—leaving individuals, hospitals and doctors holding the bag for care already provided. Policies can only be legally rescinded if the applicant lies on the application to conceal pre-existing conditions.
Individuals pay exorbitant premiums for coverage purchased outside of employer group plans, and are also more vulnerable to such cancellations in California law. But this is bad news for everyone, not just those who have to buy individual plans. Who pays when hospitals and doctors aren't reimbursed? The taxpayers do, one way or the other. The taxpayers also paid for the state's investigation, whose end result is a measly $1-million suit against Blue Cross, whose annual profit is more than three times that. Blue Cross policy holders funded an entire department of the company devoted to finding reasons to cancel the policies of sick or pregnant people.
About 6.5 million California residents, or about 18 percent of the population, lack health insurance.
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Continued From Above
Comments
Wow Mike, I'm not used to finding someone even more verbose than me.
> What's the point of keeping people alive a few extra years to enjoy government-sponsored
> (and hence directed) life?
None. This has to do with religion in our legal system. Oh, and profit incentive. People are often kept "alive" until their money runs out. This is a point for my case, not yours.
> My number one priority, at the expense of ALL ELSE, is personal freedom and
> responsibility. I view those two together as a collective singular -- you can't have
> one without the other.
Don't see the relevance here. We have legislations on health now. I think most other countries offer far more freedom in health than we do. But this is not a result of nationalized or private health care. It's a legal issue. We have no separation of church and state with respect to many of the choices.
> Further, when the nanny state provides, personal responsibility is eroded. Without
> personal freedoms and responsibilities what's the point of life? We become little
> more than batteries in a machine. No thanks.
Huh? I do not get this at all.
> Without question, if the cost of freedom and responsibility is these things you listed
> (and I reject that it is) then that's simply the cost we must bear.
I think you are merely fighting for the freedom of the poor to die. The freedom you talk about is available only to those so wealthy that they don't even need insurance. Our current insurance companies certainly do not allow freedom nor do they reward responsibility.
> Medical care is a business like any other.
I've seen places where this is not so. In fact, this is not true in the civilized world, i.e. every other developed democratic nation.
> The motivation for business is, and will always be, profit. You suggest that using profit
> as a motive leads to these unnecessary procedures. No doubt it does. I won't even argue
> that point. Is the answer to have the government step in? Absolutely not.
We'll have to agree to disagree on this one.
> Picture this:
> You're a woman. You're pregnant. The doctor suggests an 'unnecessary' C-section.
> What do you do?
> Scenario A: Employer provided insurance -- The vast majority of the expense of that
> procedure is amortized over every employee, plus employees from different companies
> on the same plan (including men), and the cost to you is negligible. You believe that
> the doctor is providing you what you need, and since it doesn't cost that much anyway,
> you agree.
Thus incurring a cost to our society. Remember, there are many such unnecessary procedures being recommended, consciously or subconsciously, for a profit. We all pay for all of them.
> Scenario B: Personal (out of pocket) insurance ?
Do you mean insurance for which you spent money or that you will pay out of pocket? It sounds like you're mixing and matching in this example.
> You likely didn't spend as much as your employer on your insurance, and certainly
> no men have purchased pregnancy coverage for themselves, so this time the amount
> you'll pay is much more. Rather than simply saying 'Ok', you get another opinion,
> perhaps research it yourself and find that it's not necessary, and the doctor is just trying
> to bilk you. You reject the advice of your doctor, and have a natural (less expensive) birth.
Once insurance is paying, I can't see why the difference here. Further, men, or at least men with family plan insurance, do indeed pay for pregnancy insurance. Even those of us with no children and vasectomies often have no choices for a married couple plan that does not include children.
> Extend this example to other types of care, and soon doctors realize that the gravy
> train is slowing down. Minimizing cost -- not maximizing revenue -- becomes the
> way to turn a profit. That's good for everyone.
There is no evidence at all that this is happening. Costs are increasing and health insurance companies have no incentive to reduce them. They simply increase rates and decrease coverage. The only cost they try to reduce is the staff on the phone to answer your questions. This causes many people to give up after months and eat the cost themselves. This is a huge win for a company that now has that many fewer claims to pay.
> Some will say this places too much burden on patients to manage their own care. To
> those who would say that -- Piss Off. Your body is your most valuable possesion. If
> you can't be bothered to do a little legwork to manage it, screw you.
I somewhat agree with you here. But fail to see how any of what you've said supports the claim that privatized health care encourages taking responsibility.
> Verily, there will be people who can't afford it in either case. Someone else's lack of
> ability to do/afford/achieve a thing should NOT be a reason for the government to
> step in. Forget what you heard, this is the land of opportunity.
I can't believe there are still people on the planet that really think this way. This is a wholly offensive and despicable point of view. There are simply not enough jobs to go around. If one individual does as you say, another is kicked out of the work force. I say, if you can honestly believe this drivel, screw you!
> Fend for yourself or find religion
Oh good, now you're forcing religious beliefs on the poor. So much for freedom of religion. I really detest your views and find them morally unconscionable.
> The crime rate is high because we have too many laws.
Sorry, I meant violent crime rate!
> You mention literacy. If you want to improve education in this country, abolish the
> federal department of education and use the proven system of tying the money to
> the students -- not the schools.
I'm not sure of the right answer here. I find it embarrassing that countries like Costa Rica can achieve 99% literacy and the U.S. cannot.
> Lastly, you address the disparity between line workers and CEOs. I couldn't care
> less about this, and neither should you.
Don't tell me what to care about. CEOs make way more than they are worth and often get huge bonuses for implementing layoffs. I'd support a law disallowing bonuses and stock dividends in any year in which there was a significant layoff.
> In all things, including healthcare, a government-mandated solution should be the
> last resort, and only when it utterly unfathomable that the private sector can't address
> the need.
Thank you for expressing the freedom to starve philosophy that is the reason I strongly disagree with the libertarian tenets.
Wow Mike, I'm not used to finding someone even more verbose than me.
> What's the point of keeping people alive a few extra years to enjoy government-sponsored
> (and hence directed) life?
None. This has to do with religion in our legal system. Oh, and profit incentive. People are often kept "alive" until their money runs out. This is a point for my case, not yours.
> My number one priority, at the expense of ALL ELSE, is personal freedom and
> responsibility. I view those two together as a collective singular -- you can't have
> one without the other.
Don't see the relevance here. We have legislations on health now. I think most other countries offer far more freedom in health than we do. But this is not a result of nationalized or private health care. It's a legal issue. We have no separation of church and state with respect to many of the choices.
> Further, when the nanny state provides, personal responsibility is eroded. Without
> personal freedoms and responsibilities what's the point of life? We become little
> more than batteries in a machine. No thanks.
Huh? I do not get this at all.
> Without question, if the cost of freedom and responsibility is these things you listed
> (and I reject that it is) then that's simply the cost we must bear.
I think you are merely fighting for the freedom of the poor to die. The freedom you talk about is available only to those so wealthy that they don't even need insurance. Our current insurance companies certainly do not allow freedom nor do they reward responsibility.
> Medical care is a business like any other.
I've seen places where this is not so. In fact, this is not true in the civilized world, i.e. every other developed democratic nation.
> The motivation for business is, and will always be, profit. You suggest that using profit
> as a motive leads to these unnecessary procedures. No doubt it does. I won't even argue
> that point. Is the answer to have the government step in? Absolutely not.
We'll have to agree to disagree on this one.
> Picture this:
> You're a woman. You're pregnant. The doctor suggests an 'unnecessary' C-section.
> What do you do?
> Scenario A: Employer provided insurance -- The vast majority of the expense of that
> procedure is amortized over every employee, plus employees from different companies
> on the same plan (including men), and the cost to you is negligible. You believe that
> the doctor is providing you what you need, and since it doesn't cost that much anyway,
> you agree.
Thus incurring a cost to our society. Remember, there are many such unnecessary procedures being recommended, consciously or subconsciously, for a profit. We all pay for all of them.
> Scenario B: Personal (out of pocket) insurance ?
Do you mean insurance for which you spent money or that you will pay out of pocket? It sounds like you're mixing and matching in this example.
> You likely didn't spend as much as your employer on your insurance, and certainly
> no men have purchased pregnancy coverage for themselves, so this time the amount
> you'll pay is much more. Rather than simply saying 'Ok', you get another opinion,
> perhaps research it yourself and find that it's not necessary, and the doctor is just trying
> to bilk you. You reject the advice of your doctor, and have a natural (less expensive) birth.
Once insurance is paying, I can't see why the difference here. Further, men, or at least men with family plan insurance, do indeed pay for pregnancy insurance. Even those of us with no children and vasectomies often have no choices for a married couple plan that does not include children.
> Extend this example to other types of care, and soon doctors realize that the gravy
> train is slowing down. Minimizing cost -- not maximizing revenue -- becomes the
> way to turn a profit. That's good for everyone.
There is no evidence at all that this is happening. Costs are increasing and health insurance companies have no incentive to reduce them. They simply increase rates and decrease coverage. The only cost they try to reduce is the staff on the phone to answer your questions. This causes many people to give up after months and eat the cost themselves. This is a huge win for a company that now has that many fewer claims to pay.
> Some will say this places too much burden on patients to manage their own care. To
> those who would say that -- Piss Off. Your body is your most valuable possesion. If
> you can't be bothered to do a little legwork to manage it, screw you.
I somewhat agree with you here. But fail to see how any of what you've said supports the claim that privatized health care encourages taking responsibility.
> Verily, there will be people who can't afford it in either case. Someone else's lack of
> ability to do/afford/achieve a thing should NOT be a reason for the government to
> step in. Forget what you heard, this is the land of opportunity.
I can't believe there are still people on the planet that really think this way. This is a wholly offensive and despicable point of view. There are simply not enough jobs to go around. If one individual does as you say, another is kicked out of the work force. I say, if you can honestly believe this drivel, screw you!
> Fend for yourself or find religion
Oh good, now you're forcing religious beliefs on the poor. So much for freedom of religion. I really detest your views and find them morally unconscionable.
> The crime rate is high because we have too many laws.
Sorry, I meant violent crime rate!
> You mention literacy. If you want to improve education in this country, abolish the
> federal department of education and use the proven system of tying the money to
> the students -- not the schools.
I'm not sure of the right answer here. I find it embarrassing that countries like Costa Rica can achieve 99% literacy and the U.S. cannot.
> Lastly, you address the disparity between line workers and CEOs. I couldn't care
> less about this, and neither should you.
Don't tell me what to care about. CEOs make way more than they are worth and often get huge bonuses for implementing layoffs. I'd support a law disallowing bonuses and stock dividends in any year in which there was a significant layoff.
> In all things, including healthcare, a government-mandated solution should be the
> last resort, and only when it utterly unfathomable that the private sector can't address
> the need.
Thank you for expressing the freedom to starve philosophy that is the reason I strongly disagree with the libertarian tenets.
This is horrific. But, there are far better reasons than this to have national health care.
1) We pay more than any other country in the world. We pay 15% of our GDP for health care. I believe the next highest is 9%
2) We're ranked at around 47th best health care in the world, sandwiched in between some of the better third world nations, but far worse than any developed democratic nation in both life expectancy and infant mortality.
3) No country provides the best possible health care to all members of the population. However, other nations use metrics to decide how best to allocate the money. They make logical decisions based on saving life versus improving live, Quality of life Adjusted Life Years (QALYs), cost per QALY, etc. (This is the source of horror stories of people waiting for care.)
4) Other countries make their decisions using public discussions involving doctors, politicians, and the public.
5) The U.S. makes its decisions based on who can pay. Our motto in this may as well be, "screw the poor." (This is the alternative to the horror stories I mentioned above. Is this really better? I think not.)
6) Unnecessary procedures are simply not performed when there is no profit incentive to do so.
The time has long since come to switch to nationalized health care. What are we waiting for?
1) So what if we pay more? We pay more because the government mandates coverage from employers. Alot of that coverage is unwanted and unneeded. Company policies are too 'blanket' for most. That's a major part of the reason it's expensive. Regardless of why it's expensive, being expensive is NOT a reason to take away my choice and make me pay for other people's care.
2) Okay, what government-run entity are you using as your example of efficiency and quality that makes you think that some percieved shortcoming in quality would be fixed by letting the government run it? Please, I'd really like to know. Walter Reed, perhaps?
3) No way do I want some bureaucrat deciding the best place to spend money. It's my money, I want to spend it on whatever care I want, whenever I want it.
4) Of those 3, the only one I want deciding anything about my care is the doctor. 'The public' is full of idiots who will always vote whatever benefits them the most, and the politicians are the pandering idiots who give it to them without concern for what's in the best interest of the country/state/whatever.
5) It's not at all "Screw the poor" -- it's let the private sector charities deal with them. We are a hugely generous society, and we would only be moreso if the government wasn't stealing so much of our money to give it people in the name of 'equity' or some other crap. Give me my money back, I'll donate some of it.
6) 'Necessary' has nothing to do with it. If I want to have my ears stapled to my nuts and I have the money, who are you or anyone else to tell me I can't because it's unnecessary. That's my choice, not yours.
The most cost-effective things in this country are things that people have to buy for themselves and that AREN'T handed to them by the welfare state.
Choice drives efficiency, government interference stifles it. Medical costs are so high for 2 major reasons -- idiot jurors granting millions of dollars for minor injuries, and the fact that government forces employers to provide health care.
I, for one, had 'universal health care' in the army, and it sucked. Not just a little, but a lot. It sucked ass. Let the recent Walter Reed debacle be a warning. Government is the last entity you should want providing your health care.
As to the issue in the post itself -- it is horrific, indeed, but there are better ways to deal with it than throwing out the baby with the bathwater. If the company broke the law (and the law is just) then punish them.
If universal care passes, we will quickly have some of the worst care you've ever seen. Just look at our government schools for an example of universal ineptitude.
The good old Republican response to the needs of the disenfranchised is always the same - we don't care how much money is wasted on empire building maintaining a bloated volunteer ( nonrepresentative) military or the 700 military bases throughout the world.
Keep hanging on to your static beliefs and you can watch the rest of the world go by as the corporations dictate every aspect of our life - they already run energy, healthcare, defense,broadcast news,agriculture...etc.
Actually, Mike, there are a lot of numbers out there that say that the government would be more effective. Instead of having to file 100s of different kinds of insurance forms, doctors would only have to file one. That would free up a lot of time. Moreover, the private insurance companies have high overhead costs, that even a government would likely beat. And, universal health care doesn't prevent people from having their nuts stapled to their ears if they're willing and able to pay for it out of pocket.
I won't address Robert's response, because it didn't even make any sense.
Cameron, The number of companies against which a doctor has to file claims is not the concern. If it is, let someone set up a company that acts as a central place to handle just that. If doctor's don't like doing it themselves, they'll use the service. Competition will drive the price down. It's the same reason most doctors don't, for example, make their own gauze. Free enterprise drives down costs when big government doesn't prevent it from doing so.
Again, private insurance companies continue to have high costs because they're not forced by competition to improve. The federally mandated employer health plans justify inefficient blanket plans. Let people buy their own plans -- consisting of only the coverage they want-- and watch as everyone gets the coverage they need for less.
-Mike
Mike,
I guess I'm simply not satisfied to live in the only nation in the world that has gone from being a developed nation to being a third world nation. Here are some examples of areas where the U.S. is ranked among the better third world nations but far below absolutely every single developed democratic nation in the world:
1) Life expectancy.
2) Infant mortality.
3) Literacy.
4) Crime rate.
5) Income disparity between CEOs and line workers.
Yes, I am aware that only the first two pertain to health care. I feel this is part of a broader picture in the U.S. at present. I believe we can no longer call ourselves a developed nation with these statistics. I believe that health care is the largest of these problems.
Also, when referring to unnecessary procedures, I was NOT referring to elective procedures. I was referring to procedures where the doctor tells you that you NEED an operation of some type and you actually do not. C-sections are an example of one such procedure where we can actually point to the sheer number that we perform, which is much higher than in the rest of the world, and say that we must be doing them unnecessarily. There are probably many other such examples. I believe in these cases that the profit motive of doctors and hospitals, who clearly make much more money this way, is actively interfering with good medical care.
Misanthropic Scott,
What's the point of keeping people alive a few extra years to enjoy government-sponsored (and hence directed) life?
My number one priority, at the expense of ALL ELSE, is personal freedom and responsibility. I view those two together as a collective singular -- you can't have one without the other. Every government program takes money away from me to pay for it. As a result, I have less choice in how my money is spent. That's bad. That includes excessive spending on defense, Robert (there, I've addressed the non-sequitur).
Further, when the nanny state provides, personal responsibility is eroded. Without personal freedoms and responsibilities what's the point of life? We become little more than batteries in a machine. No thanks.
Without question, if the cost of freedom and responsibility is these things you listed (and I reject that it is) then that's simply the cost we must bear.
Medical care is a business like any other. The motivation for business is, and will always be, profit. You suggest that using profit as a motive leads to these unnecessary procedures. No doubt it does. I won't even argue that point. Is the answer to have the government step in? Absolutely not.
Picture this:
You're a woman. You're pregnant. The doctor suggests an 'unnecessary' C-section. What do you do?
Scenario A: Employer provided insurance -- The vast majority of the expense of that procedure is amortized over every employee, plus employees from different companies on the same plan (including men), and the cost to you is negligible. You believe that the doctor is providing you what you need, and since it doesn't cost that much anyway, you agree.
Scenario B: Personal (out of pocket) insurance -- You likely didn't spend as much as your employer on your insurance, and certainly no men have purchased pregnancy coverage for themselves, so this time the amount you'll pay is much more. Rather than simply saying 'Ok', you get another opinion, perhaps research it yourself and find that it's not necessary, and the doctor is just trying to bilk you. You reject the advice of your doctor, and have a natural (less expensive) birth.
Extend this example to other types of care, and soon doctors realize that the gravy train is slowing down. Minimizing cost -- not maximizing revenue -- becomes the way to turn a profit. That's good for everyone.
Some will say this places too much burden on patients to manage their own care. To those who would say that -- Piss Off. Your body is your most valuable possesion. If you can't be bothered to do a little legwork to manage it, screw you. You're not my concern.
Verily, there will be people who can't afford it in either case. Someone else's lack of ability to do/afford/achieve a thing should NOT be a reason for the government to step in. Forget what you heard, this is the land of opportunity. Fend for yourself or find religion -- they tend to provide for the basic needs of those who can't or won't.
The crime rate is high because we have too many laws. Simple as that. Unless a thing infringes on my rights or defrauds me of my property, it's not a crime regardless of whether or not it's currently illegal. De-criminalize things that aren't crimes (drug-use, for example) and watch the crime rate drop. It's not at all that we live in a society full of criminals, it's that the government is, for some reason, opposed to letting us live our own lives.
You mention literacy. If you want to improve education in this country, abolish the federal department of education and use the proven system of tying the money to the students -- not the schools. Make schools accountable for performance in this way and watch as kids suddenly start learning to read. Literacy is down because of federal control of education and teachers' unions. John Stossel has covered this extensively. Check him out.
Lastly, you address the disparity between line workers and CEOs. I couldn't care less about this, and neither should you. Exluding the arbitrary interventions of the government (read: minimum wage) and the inflated wages of unions, people earn what someone will pay them to use their skills. Show me a line worker with a skillset above his station and I'll show you someone who doesn't apply himself. If the CEO of Exxon is earning more than he deserves, that's a stockholder concern, not a government one.
In all things, including healthcare, a government-mandated solution should be the last resort, and only when it utterly unfathomable that the private sector can't address the need.
-Mike
Wow Mike, I'm not used to finding someone even more verbose than me.
> What's the point of keeping people alive a few extra years to enjoy government-sponsored
> (and hence directed) life?
None. This has to do with religion in our legal system. Oh, and profit incentive. People are often kept "alive" until their money runs out. This is a point for my case, not yours.
> My number one priority, at the expense of ALL ELSE, is personal freedom and
> responsibility. I view those two together as a collective singular -- you can't have
> one without the other.
Don't see the relevance here. We have legislations on health now. I think most other countries offer far more freedom in health than we do. But this is not a result of nationalized or private health care. It's a legal issue. We have no separation of church and state with respect to many of the choices.
> Further, when the nanny state provides, personal responsibility is eroded. Without
> personal freedoms and responsibilities what's the point of life? We become little
> more than batteries in a machine. No thanks.
Huh? I do not get this at all.
> Without question, if the cost of freedom and responsibility is these things you listed
> (and I reject that it is) then that's simply the cost we must bear.
I think you are merely fighting for the freedom of the poor to die. The freedom you talk about is available only to those so wealthy that they don't even need insurance. Our current insurance companies certainly do not allow freedom nor do they reward responsibility.
> Medical care is a business like any other.
I've seen places where this is not so. In fact, this is not true in the civilized world, i.e. every other developed democratic nation.
> The motivation for business is, and will always be, profit. You suggest that using profit
> as a motive leads to these unnecessary procedures. No doubt it does. I won't even argue
> that point. Is the answer to have the government step in? Absolutely not.
We'll have to agree to disagree on this one.
> Picture this:
> You're a woman. You're pregnant. The doctor suggests an 'unnecessary' C-section.
> What do you do?
> Scenario A: Employer provided insurance -- The vast majority of the expense of that
> procedure is amortized over every employee, plus employees from different companies
> on the same plan (including men), and the cost to you is negligible. You believe that
> the doctor is providing you what you need, and since it doesn't cost that much anyway,
> you agree.
Thus incurring a cost to our society. Remember, there are many such unnecessary procedures being recommended, consciously or subconsciously, for a profit. We all pay for all of them.
> Scenario B: Personal (out of pocket) insurance
Do you mean insurance for which you spent money or that you will pay out of pocket? It sounds like you're mixing and matching in this example.
> You likely didn't spend as much as your employer on your insurance, and certainly
> no men have purchased pregnancy coverage for themselves, so this time the amount
> you'll pay is much more. Rather than simply saying 'Ok', you get another opinion,
> perhaps research it yourself and find that it's not necessary, and the doctor is just trying
> to bilk you. You reject the advice of your doctor, and have a natural (less expensive) birth.
Once insurance is paying, I can't see why the difference here. Further, men, or at least men with family plan insurance, do indeed pay for pregnancy insurance. Even those of us with no children and vasectomies often have no choices for a married couple plan that does not include children.
> Extend this example to other types of care, and soon doctors realize that the gravy
> train is slowing down. Minimizing cost -- not maximizing revenue -- becomes the
> way to turn a profit. That's good for everyone.
There is no evidence at all that this is happening. Costs are increasing and health insurance companies have no incentive to reduce them. They simply increase rates and decrease coverage. The only cost they try to reduce is the staff on the phone to answer your questions. This causes many people to give up after months and eat the cost themselves. This is a huge win for a company that now has that many fewer claims to pay.
> Some will say this places too much burden on patients to manage their own care. To
> those who would say that -- Piss Off. Your body is your most valuable possesion. If
> you can't be bothered to do a little legwork to manage it, screw you.
I somewhat agree with you here. But fail to see how any of what you've said supports the claim that privatized health care encourages taking responsibility.
> Verily, there will be people who can't afford it in either case. Someone else's lack of
> ability to do/afford/achieve a thing should NOT be a reason for the government to
> step in. Forget what you heard, this is the land of opportunity.
I can't believe there are still people on the planet that really think this way. This is a wholly offensive and despicable point of view. There are simply not enough jobs to go around. If one individual does as you say, another is kicked out of the work force. I say, if you can honestly believe this drivel, screw you!
> Fend for yourself or find religion
Oh good, now you're forcing religious beliefs on the poor. So much for freedom of religion. I really detest your views and find them morally unconscionable.
> The crime rate is high because we have too many laws.
Sorry, I meant violent crime rate!
> You mention literacy. If you want to improve education in this country, abolish the
> federal department of education and use the proven system of tying the money to
> the students -- not the schools.
I'm not sure of the right answer here. I find it embarrassing that countries like Costa Rica can achieve 99% literacy and the U.S. cannot.
> Lastly, you address the disparity between line workers and CEOs. I couldn't care
> less about this, and neither should you.
Don't tell me what to care about. CEOs make way more than they are worth and often get huge bonuses for implementing layoffs. I'd support a law disallowing bonuses and stock dividends in any year in which there was a significant layoff.
> In all things, including healthcare, a government-mandated solution should be the
> last resort, and only when it utterly unfathomable that the private sector can't address
> the need.
Thank you for expressing the freedom to starve philosophy that is the reason I strongly disagree with the libertarian tenets.
It seems that the fundamental difference between private and public needs to be explained—the reasoning as to why some kinds of activity are best served by a market economy and others by the state. I know that I don't really understand it myself but still the justification for why some activities are more efficient in government hands while others are better left in private hands needs to be clarified—perhaps by “qualified people” by means of a documentary of some kind where the private sector and public sectors could be explained to Joe Public. I think that those who claim everything must be private are faced with explaining why European countries use on average half as much in terms of percentages of their Gross National Product on taking care of their entire population as the American system does in only taking care of part of its population. The American system denies 20% of the population health care outright while its exorbitant costs affect the lives of around 2 million Americans yearly due to medical related bankruptcies. You would think that the propaganda machine that preaches private, would explain how it fails 20% of the population completely—offering them the right to suffer until death relieves them of their agony—while it ruins the lives of 2 million Americans yearly by offering them medical care they can't afford and thus consigning them to a life in poverty.
I mean a private company, at least in my limited understanding of it, seeks to maximize its profits or minimize its costs. There is in this market efficiency concept the idea that if every body does their thing to the best of their ability, behave maximally egotistical, that then the best allocation of resource in the society will result. But what happens when the costs of a given good become so high that the producer of the good (the hospital) can't sell it at a price which the average income of the population can afford? That is the situation today with health care in the US. Health care is not a good that is dependent upon choice in the normal sense of the word, while logically the theory of market economy seems to build on the concept of consumer preferences—that their freedom of choice creates demand. Health care is a good that is demanded by each and every member of the society at some time during the course of their life, but usually not by choice. Still an individual may face the blunt reality that our society will let them die on the street, if the situation arises that this individual for what ever the reason may, finds themselves in dire need of medical care but can't pay, a choice will be made that directly concerns their right to live but the choice will not be made by them but rather by the hospital, which in a sense proves the market doesn't allocate all kinds of goods effectively—especially in matters of life and death or in a moral sense. In other words there are situations that cause the market concept to brake down but nonetheless the need of this kind of good may well prove to be critical to the functioning of society. This seems to be the case with almost all collective goods, from the functioning of the railways, the water we drink, electricity to heat and light the home, to the right to a higher education as well as our common health and probably other kinds of goods like say the military (here the US seems to border on the insane—because a privatized military serves the firm not the nation and the firm serves the highest bidder under the principle of max profit and not the security of the state—anyone who claims that they are concerned with “national security” must see the insanity of this—perhaps while someone was making a program dealing with the domain of government goods and private goods they might make a series of programs that demystifies the concept of national security)
Apparently a private monopolist-oligopolist seeks to maximize revenues (not profits) and are said to be a price makers because they do not face market competition they can set the price for the good they supply. In the US we have hospitals, but if you think about them together with say grocery stores then I think you will see an obvious quantitative difference. I mean how many hospitals are there in a city and then compare that with the number of grocery stores? I think you will find that the number of hospitals could be counted on your fingers and toes while the number of grocery stores would be exceptionally high. Still the given number of hospitals must be capable of supplying each and every individual in the city with a form of potential health care (potential because if you are ill you do not in general go to the hospital but go to your family doctor) while grocery stores are probably dependent on just the surrounding population for their economic survival. It would seem that hospitals represent a kind of monopolistic position. They might be private, they might compete with other hospitals in terms of costs (superficially) but they certainly are not competing with other hospitals in the same kind of terms that grocery stores compete. Hospitals must be cost intensive to build (this is an assumption since I'm merely speculating), requiring specific kinds of functionality built into their design and their employees belong to an elite class of individuals, even their lesser elite employees demand a certified form of education and the required education of their star employees, the doctors is long term and is done at the most expensive schools in the country. In fact the costs of the hospital must be exorbitant as well as its everyday functioning, while the service they provide is in a sense universal in its nature since it is necessary if society is to function properly. In other words they offer a necessary social good but the goal of offering it to all people is limited by the costs involved in producing the good—because the costs of setting up shop are high and the potential economic risks are also high. I mean suppose the hospital has fluke year and loses a large number of malpractice suits—they could go bankrupt. This means a hospital requires a rather elaborate scheme of lawyers to protect their interests—I think in general a hospital has become a bit like Kafka's explanation of why we don't see Poseidon much anymore because he's so busy with the endless stacks of paper work—the running of the seas has become bureaucratically tedious. Interestingly it is the bureaucratic aspect of socialistic medicine that is used to argue against it but is the private system any less bureaucratic or is it even worse?
I think that here the welfare state really wipes out the private Health Care system because the private system wants to make money while the socialistic system wants to offer the population health care at cost, not profit. Still I think that Health care is a special kind of business because it is known that the ideal situation in terms of the society is when the 'good' it supplies is made available to each and every individual in the society. That is the good is per definition a public good. Something that everyone must have access to in order to function. In a business sense the employee's health is a bit like the amount of money needed to maintain production in a society—the capital investment that is mandatory so that all the machines function properly so as to maintain given levels of production. The population as a whole therefore constitutes an input factor in terms of production. The logic behind private health care is apparently a mistake because it views labor as somehow being separate from other input factors when it comes to maintaining the operation of the firm—a necessary investment so as to insure the normal functioning of the firm. By allowing companies to skate on their responsibilities to maintain the normal functioning of the firm and dumping the cost on to the employee is not very good economics because as we now are witnessing in the US, it poses a direct threat to national stability. We already see that in the US “health care” is starting to threaten the stable functioning of society (as baby-boomers move into retirement the pressure on entire fabric of American society will worsen—hence it will ultimately pose a threat to national security and the status quo seeking to maintain our present system or making it even less responsible represents a real form of oppression and consequently a threat to the well being of the nation.
Very-Basic-BS,
Excellent points. Here's one more to add to your excellent essay on the subject.
Hospitals are fundamentally different than supermarkets in that people don't shop for price. They shop for state of the art equipment, whether there is real benefit to it or not. Often there is real benefit. However, it doesn't really matter, those who can afford to make the choice will always choose the hospital with "the machine that goes PING."
You must be kidding...have you ever worked in a government office? The waste is phenomenal. The stealing is worse. The lack of care given to equipment because the government is paying for it and can get more is uncalled for. Your tax dollars could be going a LOT further if half the government employees actually did their jobs and the other half weren't trying so hard to pick up the slack and keep the whole ball rolling that they end up basket cases or walking heart attacks. NO ONE would be happy with government run health care. Mike apparently has been there, done that. You who disagree with him, obviously haven't.
thejoanie,
Actually, I understand about government waste. I also understand that corporate greed running out of control can be even worse. At least with a government agency, their charter would be to provide health care. With a the corporations, the charter is to make money, all the traffic will bear.
We're currently bearing a burden that is 15% of our GDP!!
And for that burden, we get the 47th best health care in the world. From having this discussion again recently on dvorak, another person of similar mind to yourself pointed out that the difference between us and Brittain in terms of infant mortality was ONLY 1.34 babies per thousand.
So, I did some calculations, this worked out to around 28% worse care here or aproximately 5,480 babies per year dying because our health care is not as good as the U.K.'s.
But, the really shocking bit is that he happened to pick a country that pays just 6% of their GDP on health care. So, we paid two and half times as much as Brittain and killed 5,480 babies doing it.
Our numbers compared to France would be much worse. Though, I think they spend a bit more than the U.K., still nowhere near 15% though.
Certainly, the federal government is no model for efficiency, but we must get past out fear of their handling of health care and recognize what a horrific job we're doing at it now.
And, as a minor aside, maybe, just maybe, we can stop letting poor people die because they have no health insurance. If you think getting all of your care at the emergency room is a good way to maintain health, try it for a while.
