The Cherry-picking left on health care Posted by: McQ
on Monday, May 09, 2005
Ezra Klein "cherry picks" my post on medical insurance with a partial quote in order to set up a false premise :
QandO shows us what being a libertarian is all about:
Let's talk about health care for a minute. Health care is certainly a need, but it is not a right. And all the high sounding rhetoric in the world that says otherwise is baloney.
And just like that, the right to health care is disproven.
Actually its disproven with the next line, the line Ezra chose to leave out:
Rights don't involve, involuntarily, the assets of others. Any 'right' to health care would make exactly that sort of demand on the assets of health care workers.
Obviously Ezra couldn't answer this point, so he chose to exclude it. From there he rants about "callous" libertarians, never once understanding or appreciating the irony of his statement. What could be more callous than someone assuming another is a slave to your "right"?
From there Ezra procedes to take on my points about private coverage:
From there, McQ argues for taking health care away from employers and out of the government's purview:
The immediate benefits of making health insurance an individual responsibility?
1. Portability. It now no longer matters where you work or for how long (or if you work at all) your insurance travels with you. And that means ...
2. No more preexisting conditions.
3. Pool cost averaging. No longer limited to the pool of those who work at your business, like car insurance it now is extended to the pool of those insured by your insurance company.
Funny, those are exactly the same arguments that, in saner contexts, are leveraged in favor of government-run health care. Funnier yet, they actually work better when run through the state.
To paraphrase Ezra "and just like that, government is proven to be a better provider".
What's apparent in Klein's pissy rant is that he's never found a program that government can't do better than the private sector despite overwhelming evidence to the contrary. In fact, one has to wonder why he isn't calling for all insurance to be run by government. "Get your life insurance from "StateCo", its your right!"
Insurance companies have a list of preexisting conditions long as your arm, government provided health care has none. As for portability, well, you know what I'm going to say.
Right, I do. You're going to spend everyone's money like its, well, everyone else's money.
The question is, who's going to hold the marker Ezra? Who's going to be left holding the empty bag after you make sure everyone gets their 'right' to health care fulfilled?
To hell with you Jack, if the collective decides it will pay for Viagra for the geriatric set, your job is simply to shut up and pay, and pay, and pay and pay. Its their RIGHT you're trampling on, sir!!
Yeah, that's the world I want ... can't you tell?
UPDATE [Jon Henke] — For what it's worth, I've also written a take on this debate, perhaps bridging the ideological and economic divide between Ezra and McQ to some degree.
BTW, I don’t see how government-run health care takes care of #3, pool cost averaging. True, in a sense, the pool changes, but it contains everyone, which seems to violate the spirit of your point. Choice, and not coincidence determine the group.
BTW, I don’t see how government-run health care takes care of #3, pool cost averaging.
It doesn’t. That’s because the government, per Klein, will simply disregard risk. Remember, he said there are no pre-existing conditions under his plan. Nor would anyone be declined or have to pay a larger premium because of risk.
So the question then is what insurer would take such a risk with coverage?
Well none, and stay in business. But the government will and you, anomdebus, along with everyone else, will pay, and pay, and pay ....
Forget personal responsiblity, forget paying your way ... its a ’right’.
I suppose one could assert (without bothering to demonstrate, as Ezra does not) that with state-run healthcare systems, other countries produce objectively "better" healthcare outcomes while spending half as much as we do, per capita, in the United States. That at least has the merit of being an actual argument.
But this "compassionate liberal versus hard-hearted conservative/libertarian" crap really frosts my shorts. Regardless of how dire or worthy A’s medical needs happen to be, seizing part of B’s paycheck to subsidize those needs isn’t compassion or charity, just socialism.
Hm. I see the merits of both arguments, but I’m going to be obstinate and come out swinging with "you’re both partially wrong". But only because you’re talking past each other. I read Ezra’s post, and a response—an entire post—came fully formed into my head, like some sort of, I don’t know, fully-formed post or something. I want to try to clean that up tonight. In the meantime, I think the debate is sort of missing each others points.
What Ezra Klein and other socialized medicine advocates gloss over is that under a socialized single-payer health care regime, you don’t get as much health care as you want, but as much health care as the government thinks you need. The global budget for health care grows and grows until a majority of citizens don’t want to pay any more, and then the government rations out whatever health care resources that budget will provide on the basis of "need." So even a socialized system eventually fails at providing the "right" to health care, since limited resources will force the government to ration care by denying or delaying treatment that individuals would ordinarily be "entitled" to.
Furthermore, under a privitized health care system, individuals have incentives to mitigate risks that do not exist under a single-payer socialized system. Even individuals born with genetic predispositions to heart disease, cancer can make lifestyle changes to mitigate those risks and lower their premiums. Under a socialized system, the premium that one pays is decided largely by political factors—the costs of such a system are increasingly born not by those with the highest risk, but by those who are politically unpopular.
Finally, Mr. Klein ignores the thrust of McQ’s argument: that government intervention is not necessary to achieve the goals of portable coverage or pre-existing conditions and consequently these goals cannot be used to justify the necessity of a government-run health care system.
I don’t understand the assumption that privately purchased health insurance would mean risk-pooling, eliminating price discrimination by age and pre-existing conditions.
Elderly people cost many times as much as healthy young people to insure. People with pre-existing conditions cost many times as much. If you’re an insurer paying for (say) a boy with MS, your costs can be astronomical. So why would any rational health insurer allow them to buy health insurance at the same rate as a healthy young person?
I could imagine that some benevolent health care insurer could decide to provide coverage at rates that would cover the median person. But if would have to compete with other insurers that exercise price discrimination by age and pre-existing condition. Young, healthy people would flock to the lower rates available at discriminating insurers; they wouldn’t voluntarily subsidize the elderly and infirm. BenevolentCo would quickly have to jack up its rates to cover the costs of covering the elderly and infirm people who couldn’t get coverage at DiscrimCo. Right?
Car insurance and flood insurance are relatively unregulated, and they practice price-discrimination- if you’re at a greater risk (young, male, bad driving record, live in a flood plain) you pay more for insurance, if you can get it at all. The downside risk of insuring a car is far, far less than the downside risk of paying for the health care of an individual.
I was talking about exactly this issue on Crooked Timber recently. I’d really love to debate you on it. If you would be willing to write a description of what a libertarian health care system would look like, I’d be delighted to print it in full at Crooked Timber (and then take some potshots at it, as you might imagine). Email me if you’re interested.
I don’t understand the assumption that privately purchased health insurance would mean risk-pooling, eliminating price discrimination by age and pre-existing conditions.
I absolutely agree that private health insurance would be subject to—and benefit from!—pool cost averaging, but I don’t think McQ said differently. He simply said (implied, perhaps) that consumers would have more choice—more options—when it came to picking our pool. As it stands, I get the pool where I work. That may or may not work well for me, but there’s not much to be done about it.
However, two things should be understood:
1) Price discrimination is not only a problem. It also allows a more diverse resource distribution. After all, if insurers have to cover the "median person", that’s going to require far too much coverage for some people at the low end of the risk pool, and far too little for some at the high end of the risk pool. There’s a lot of inefficiency there.
2) It’s difficult to have a debate, when you (we) each come at health care with fundamentally different values, philosophies and goals. (I deal with that in this follow-up post) If you’re shooting at different targets, it’s not hard to see why you’ll reach different conclusions about weapons, aim, etc.
There’s also the question of whether the cost to individuals—and to future generations—of forcing them into a specific pool outweighs the benefit to other individuals of providing them with a health care floor, and whether such a cost violates whatever system (Rawlsian?) of justice you prefer.
It’s difficult to have a debate, when you (we) each come at health care with fundamentally different values, philosophies and goals.
I think this is sort-of right. For Ezra, government-run single-payer health care is a means to an end. The real goal is providing respectable amount of health care to all Americans for as little as possible. I have no doubt that Ezra could be convinced that government isn’t the solution if the right data was provided.
For McQ (I suspect, I just surfed over from Ezra’s. I’ll impute the arguments of most libertarians), it ultimately doesn’t matter what is cheapest or most efficient. Sure, he may say that private insurance is best, but ultimately it doesn’t matter. Even if government health insurance was objectively better, it would be immoral (like slavery) to provide it.
At first it might seem that it is pointless to have a debate if the two have different goals. But McQ has a way of avoiding the problem: drop the moral argument. Just debate the practical effects of each system. If McQ can make a credible argument that the present system (or some fullly market-based system) is the least costly and most likely to provide the most innovation then I’d like to hear it.
Also, I’d suggest that innovation be defined as medical inventions and discoveries that reduce current medical costs (as opposed to optional lifestyle improvements). If McQ doesn’t want to pay for someone else’s Viagra usage, I sure as hell don’t want the billions of dollars spent on the development and marketing of it to count as "proof" that the U.S. is a leader in medical research.
Jon, you’re right when you say in your follow-up that liberals and libertarians are shooting for different goals in health care, and so tend to shoot past each other in debate. I think that we’re shooting past each other now, but not because of our different values; it’s because we seem to be using the same words differently. I’ll try to be more precise.
I think that McQ is assuming that private health insurance would lead to the pooling of risks. That’s literally true- as long as you don’t simply get a bill for services rendered, you’re experiencing risk-pooling- but I don’t believe that any insurer can simultaneously (1) compete and (2) offer the benefits of risk pooling. Rather, I believe that a rational health insurer in a world private health insurance world will do its best to calibrate its charges to the needs of each individual. Healthy young people will pay little, and older people and those with pre-existing conditions, or a family history of expensive illness, will pay much more. That’s a great deal for healthy young people, but it’s not so great for everyone else. In fact, it can be a death sentence.
As you correctly note, "But there will be costs...there are always costs. You may shift them around to fit your liking—as Ezra and McQ do here—but you can never eliminate them." Let’s take a person with a chronic condition that costs $100,000 a year to treat. Year in, year out, someone has to pay at least $100,000 to cover her, or she’ll die.
No rational healthy person would choose to be covered in the same pool and let his premiums pay for her care. So she’ll be put in a pool for people with serious conditions. In a perfectly competitive market, she should be paying a little more than $100,000 per year. Most people can’t afford that, so she’s going to die.
Now, it’s not hard for me to understand why a hardcore libertarian would say that that’s OK. You never agreed to pay for Hypothetical Person’s health care, any more than you agreed to pay her rent. That’s fine. But I have to ask libertarians to accept that this is the price of their position: many people, especially the elderly, are going to die of treatable conditions because they can’t afford the treatment.
Unless you can describe a libertarian health care system to me that would work better. I’d really love to debate it more; I find this fascinating.
Space posted: "I have no doubt that Ezra could be convinced that government isn’t the solution if the right data was provided."
Do you have any of this data to support that point? Everything I’ve seen consistently pints the other way, i.e., single payer program cost less because they don’t have to return value to shareholders and economies of scale, to oversimplify for the sake of brevity.
If we don’t allow indigents to die on the hospital steps, the question is not if we will pay, rather how we will pay. Right now we all pay, either trhough cost shifting or taxes, but rather inefficiently. It seems pretty clear that waiting to give treatment in ER’s ain’t terribly efficient.
Yes, ERs are the MOST expensive form of treatment, unforunately its all they got.
I don’t understand all this "would" and "could" talk about a private system. All of what everyone describes is happening right now. If you get insurance through your employer, aren’t you essentially risk-pooling with your employees and the larger pool at hand? If my coworker all of sudden falls ill, and needs a 100K/year treatment, I’m essentially footing part of that bill.
Now try getting insurance if your employer doesn’t provide it, the working unemployeed get the most raw deal of them all, its nearly impossible. Recently, the lobster men in MA (thats the ones who catch lobster, not the one with lobster like facial and hand features) banned together and formed a whateverthehellyoucallit and the insured rate of Lobstermen in MA went from something like 15% to 60% instantly, hopefully expanding into the 80s-90s in awhile.
From a non-libertarian point of view, whats the big deal with expanding the pool? Ofcourse, then theres the jobless uninsured. I don’t really know what to say. If the data shows universal coverage can be less expensive and just as efficient in coverage to all, you’ll get no complaints from me. I have to pay for it anyway, I don’t care how its handled as long as its efficient. Those foreign systems have flaws that would need to be addressed before implemented here. Ezra pointed them out weeks ago.
But I have to ask libertarians to accept that this is the price of their position: many people, especially the elderly, are going to die of treatable conditions because they can’t afford the treatment.
Ah, the tired old "unacceptable consequences" canard. I was wondering when it’d crop up, seeing as how it’s a kissing cousin of Ezra’s "compassion" foolishness: "You’d force grandma to collect beercans to pay for her dialysis! The horror!"
Get some new talking points, Ted. The old ones are pretty threadbare.
If my coworker all of sudden falls ill, and needs a 100K/year treatment, I’m essentially footing part of that bill.
The difference, of course, Adrock, is that I’m doing so voluntarily. I can always opt out of my employer’s health plan if, for whatever reason, I don’t need or want to pool health risks with my coworkers.
Could I opt out of a socialized healthcare system? Decline benefits in order to pocket my premiums? Of course not: like Social Security and every state-run boondoggle, these things depend on an ever-increasing number of suckers paying into the system.
