Arnold Kling Doesn't Understand

Arnold Kling [Update: Arnold's response to this post]:

I Don't Understand Mark Thoma, by Arnold Kling: He writes,

But focusing on the immediate problems brought about by tax cuts and military spending should not divert us from the more formidable problem of solving the escalating health cost problem. If Obama wins and tries to institute some form of universal care, it will be opposed as a budget breaker (and for other reasons), but I think universal care will help a lot in bringing down health care cost growth.

There is health care spending paid for by the private sector. Call it P. There is health care spending paid for by the government. Call it G.

The problem with G is that it is busting the budget. I do not understand how reducing P and raising G represents a solution. Even if you think that government can do health care more efficiently, you are still raising G and making the budget problem worse.

P can grow as a percent of GDP as much as it wants to, and be as wasteful as it wants to, without affecting the fiscal outlook. Only G affects the fiscal outlook.

What happens when you take people out of P and put them into G? You might make people's lives better (that's a separate disagreement). You might increase the overall efficiency of the health care system (another separate disagreement). But you do not improve the fiscal outlook. You make it worse.

I absolutely do not see how anyone can say otherwise.

Agreed there is spending on health care in both sectors. That's why I wrote recently that:

At some point we do have to face budget realities... [T]his ... is mainly a problem with rising health care costs (and that will be a problem whether it's paid for publicly or privately)

I didn't explain fully, but the answer to Arnold's question is straightforward. Health care in the private sector is not free. Using his notation, when I think about moving P to G, I also think about moving the revenue stream with it (e.g. individuals would pay monthly premiums in taxes rather than to the insurance company). Thus, if we move all of P to G, we also move all of the revenue with it. Therefore I don't see why the budget problem has to get worse:

Even if you think that government can do health care more efficiently, you are still raising G and making the budget problem worse.

You are also raising T, taxes, to pay for more G (raising is the wrong word, moving the revenue stream is better). Since costs per unit fall (as he says, "You might increase the overall efficiency of the health care system"), you could provide the same overall service with an improved budget (smaller deficit), or provide better service (e.g. expand care) with no change in the budget deficit.

Why do costs per unit fall? Because of all the administrative savings, savings from buying drugs in bulk, and the ability to manage care (e.g. preventative measures, solving information problems that cause wasteful expenditures by doctors and consumers). Thus, if we did move all of P to G we would be able to rebate some of the taxes, expand coverage, etc.. Even if we did nothing but eliminate fights over who pays the bills, or eliminate the costs of screening out the unhealthy (who end up in public sector programs anyway), as we would, health costs would fall substantially.

For example:

[W]e spend more than twice as much on health care, on average, as the 21 countries in which life expectancy exceeds ours. American costs are so high in part because the reliance on private insurance multiplies administrative expenses, currently about 31 percent of total outlays.

Most health economists agree that government-financed reimbursement is the only practical way to control these expenses, many of them stemming from insurers’ efforts to identify and avoid unhealthy people. ... A single-payer system that did nothing more than reduce administrative expenses to the levels of other countries would save roughly $300 billion annually.

Or:

Some say that we can’t afford universal health care... But every other advanced country somehow manages... Americans spend more on health care per person than anyone else... Yet we have the highest infant mortality and close to the lowest life expectancy of any wealthy nation. How do we do it?

Part of the answer is that our fragmented system has much higher administrative costs than ... the rest of the advanced world. ... In addition, insurers often refuse to pay for preventive care ... because [the] long-run savings won’t necessarily redound to their benefit. And ... we lag far behind ... in the use of electronic medical records, which both reduce costs and save lives by preventing many medical errors. ...

Or:

According to the World Health Organization, in the United States administrative expenses eat up about 15 percent of the money paid in premiums to private health insurance companies, but only 4 percent of the budgets of public insurance programs, which consist mainly of Medicare and Medicaid. The numbers for both public and private insurance are similar in other countries - but because we rely much more heavily than anyone else on private insurance, our total administrative costs are much higher.

According to the health organization, the higher costs of private insurers are "mainly due to the extensive bureaucracy required to assess risk, rate premiums, design benefit packages and review, pay or refuse claims." Public insurance plans have far less bureaucracy because they don't try to screen out high-risk clients or charge them higher fees.

And the costs directly incurred by insurers are only half the story. Doctors "must hire office personnel just to deal with the insurance companies," Dr. Atul Gawande, a practicing physician, wrote in The New Yorker. "A well-run office can get the insurer's rejection rate down from 30 percent to, say, 15 percent. That's how a doctor makes money. ... It's a war with insurance, every step of the way." ...

Or:

McKinsey & Company ... recently released an important report dissecting the reasons America spends so much more on health care than other wealthy nations. One major factor is that we spend $98 billion a year in excess administrative costs, with more than half ... accounted for by marketing and underwriting - costs that don't exist in single-payer systems.

And this is just part of the story. McKinsey's estimate of excess administrative costs counts only the costs of insurers. It doesn't ... include other "important consequences of the multipayor system," .... The sums doctors pay to denial management specialists are just one example.

Incidentally, while insurers are very good at saying no to doctors, hospitals and patients, they're not very good at saying no to more powerful players. ... McKinsey estimates that the United States pays $66 billion a year in excess drug costs, and overpays for medical devices like knee and hip implants, too.

To put these numbers in perspective: McKinsey estimates the cost of providing full medical care to all of America's uninsured at $77 billion a year. Either eliminating the excess administrative costs of private health insurers, or paying what the rest of the world pays for drugs and medical devices, would by itself more or less pay the cost of covering all the uninsured. And that doesn't count the many other costs imposed by the fragmentation of our health care system.

Or, finally:

[I]f costs are to be controlled, someone has to act as a referee on doctors' medical decisions. During the 1990's it seemed, briefly, as if private H.M.O.'s could play that role. But then there was a public backlash. It turns out that even in America, with its faith in the free market, people don't trust for-profit corporations to make decisions about their health. ...

Eventually, we'll have to accept the fact that there's no magic in the private sector, and that health care - including the decision about what treatment is provided - is a public responsibility.

Comments

[A student of economics]

The evidence from other countries, as well as evidence within the US (e.g. the VA system, Medicare, etc) strongly suggest that G provides healthcare significantly more efficiently and effectively than P. Outcomes are better; costs are lower.

In that case, moving healthcare spending from P to G will "reduce health care cost growth".

QED

[save_the_rustbelt]

Since the first of the year I have read several thousand pages on health care reform, from all sides, and much of it written by economists.

All of them view the system from 30,000 feet, I have yet to find one who knows much about how the daily interactions and transactions work.

Wait until the government takes over as "referee," then there will be a real backlash.

(Note: I have mixed emotions, as a really screwed up plan with a chaotic transition could make me a lot of money)

[Or, we could save some]

Ah, but the goal is to eliminate people like you.

And you're opposed?

I see how you are.

[howard]

mark, i think it's pretty clear that arnold kling doesn't assume that when you shift p to g, you bring T with you.

in that sense, we shouldn't shy away from the implicit challenge that kling offers: yes, to provide some form of universal health care will require a tax increase. on the other hand, the percentage of gdp devoted to the same health care outcome will drop, freeing up resources for other, better uses and improving (an essential matter in the years to come) our export competitiveness.

[Patricia Shannon]

http://www.sciencedaily.com/releases/2008/07/080721223411.htm

International Monetary Fund Loans Linked To Higher Death Rates From Tuberculosis
ScienceDaily (July 28, 2008) — International Monetary Fund (IMF) loans were associated with a 16.6% rise in death rates from tuberculosis (TB) in the former Soviet Union and Central and Eastern European countries between 1992 and 2002, finds a study in PLoS Medicine.

The study, by David Stuckler and colleagues from the University of Cambridge, UK, and Yale University, USA, also found that IMF loans were linked with a 13.9% increase in the number of new cases of TB per year and a 13.2% increase per year in the total number of people with the disease.

Between 1992 and 2002, most of the countries studied in this analysis received IMF loans for the first time. As Stuckler and colleagues note, "According to the IMF, the objective of these programs is to achieve macroeconomic stability and economic growth...", yet a recent report from the Center for Global Development has suggested that countries receiving IMF loans may constrain spending on health and social services. For example, countries receiving IMF loans might need to reduce social spending in order to meet the targets set as a condition of the loan, and do so by placing caps on public wage bills or by privatizing healthcare services. However, previously it has not been clear whether IMF loans are actually linked to any changes in measurable health outcomes.

[robertdfeinman]

Kling's framing of all issues is that government is bad and should be kept to a minimum. He is getting more nuanced in his postings by pretending to admit the possibility that government could, in some cases, be more efficient.

However his neglect of shifting the revenues to the government-administered program is natural, he never thinks of increasing the amount government has to deal with.

He also makes another false assumption that a government-administered system would be a government run system. For example, in Germany, non-profit, regulated insurance companies cover the costs. This is an administrative slight of hand, it makes no difference whether the clerks are direct or indirect government employees.

So a US universal health care system could have private insurance, a mixture of private and government-administered coverage or (as with the VA) a government run system without insurance.

The money could be collected via a "tax" or employment fee or via a VAT or in any other of a number of ways. It could then be redistributed to the insurance companies as a per capita enrollment allowance, this is what the current Medicare Advantage plans do. Or the money could be remitted directly to the insurance companies.

It is an historical accounting trick (started by LBJ) that put SS and Medicare into the federal budget in the first place. Before this they were off budget dedicated programs.

One has to wonder whether Kling's consistent misunderstandings of how things work are failures in his education or ideologically motivated deliberate distortions.

[howard]

robertdfeinman, it wasn't an historical "trick" that led to the unified budget: there was no prefunding for social security at that point, so why shouldn't it be part of the unified budget? it was regarded as an advance for clarity and transparency at the time.

[don]

yeah. look at all the money we saved by moving medicare from p to g. we did it without any fiscal problem, either, since responsible voters agreed to move the required resources to g, and of course they will continue to do so.

[robertdfeinman]

Howard, that's not how I remember it. At the time it was seen as a way to hide the true cost of the Vietnam war. This trick has proven so useful that no president since has tried to put the budget back. People might get upset when they find that over half their taxes go to militarism.

To see the difference between the two approaches look at this chart:
Federal Pie Chart

[howard]

robertdfeinmann, sorry, but you're misremembering. it is true that lbj initially tried to "hide" the costs of vietnam (just as bush has tried to "hide" the costs of iraq), but that was not the basis of the unified budget, whose initial impact was a $3.7B swing (i.e., not much hiding going on there). you can read more about it here:

http://www.ssa.gov/history/BudgetTreatment.html

[inthewoods]

I'm in favor of a national healthcare system, but I'll be honest - in all the reading and research I've done, it is clear that the US has better outcomes when looking at outcomes from specific disease states (really the only fair comparison). This comes from the data from the OECD - and it is one of only a handful of studies that go down to the specific disease states and outcomes. Most people that argue for nationalized healthcare argue based on stats like mortality - which is obviously multifactoral and therefore not as relevant as specific outcomes. I'm hoping that someone can address this issue and "prove me wrong".

The other issue is that of research - will we significantly reduce the amount of research that is done by taking away the monetary effect? This is the other standard argument, and I'd love to hear someone argue against this as well. While I agree that big pharma is locked into producing me-too products, I'm worried about emerging areas such as biotech and medical devices. It appears to me like we effectively subsidize the rest of the world when it comes to medical innovation - hell, when my Dad got sick in Germany every doctor there was trained in the US - so how do we get around this?

Again - just to be clear - I'm IN FAVOR of a nationalized healthcare system - I'm just trying to answer these questions. Opinions welcome.

[Tim]

I just think it's funny that people like Kling still think it's health insurance, when it's not really that way. Insurance requires uncertainty, but check-ups, preventative screenings for cancer, and other similar costs aren't uncertain, and thus don't fit the model for insurance. Plus, once someone has past conditions or is diagnosed with certain illnesses, they no longer have control over their medical costs and are no longer "uncertain." Once it's obvious that the "market" for providing healthcare isn't an insurance market, it similarly becomes clear that the private model of insurance is a farce. It's as though the market for car insurance and regular vehicle maintenance were connected; the "insurance" companies would screen based on the type of cars, and Jaguars would never be covered and Toyota's would get cheap premiums. Except it's even worse with our health coverage because we have so little control over our own health, and we will all eventually either die or become old enough to need a lot of medical care.
Other countries have a simple, yet effective model: all basic care is covered, if you want to pay more for additional procedures, better rooms, or more coverage, then go right ahead and shop through the private sector for what you want. I think that getting the insurance out of basic medical care would be the best single improvement in the American medical system since the polio vaccine.

[muirgeo]

When you move P to G some of the high paid paper pushers in P now have to look for jobs actually providing health care rather then spending all their time trying to figure out how to deny it. With P in G paper pushers will be transformed into orderlies pushing patients, or maybe they'll be pharmacist pushing pills, or nurses pushing meds...but no more pushing paper for profit ....much more efficient.

[BJ Feng]

What is "basic care"? What does that cover? If the proponents can give a detailed basis for how government will lower costs AND keep the same quality, then please do so. If you lower the quality, then you're not getting the same thing.

Shifting the costs to the rich won't reduce overall costs. Please take into consideration that the lower the price, the more the quantity demanded, this applies to health care. How can you lower overall costs when more people are going to use the system? Certainly someone or something has to be there to decide if a person should get care or not. Right now, it's price and lifetime caps that make it unaffordable. There, you have the mechanism. What is the mechanism under your proposals? If you treat everyone regardless, then I don't see how you can reduce overall costs. If you give a man with average 5 months to live a hip surgery, that adds up and overall costs will rise. Who is going to deny this man treatment? Under our system, he either pays, or is below his lifetime cap and the insurance company allows him, or he doesn't get the treatment.

[Ryan]

I will never take any healthcare comparisons between the USA and any other country seriously unless obesity is controlled for. Likewise, poor aproximators like mortality rates, etc really have nothing to do with how effective the US system is in handling specific conditions. This leads to analysis that is entirely misleading.

"The other issue is that of research - will we significantly reduce the amount of research that is done by taking away the monetary effect? This is the other standard argument, and I'd love to hear someone argue against this as well. While I agree that big pharma is locked into producing me-too products, I'm worried about emerging areas such as biotech and medical devices. It appears to me like we effectively subsidize the rest of the world when it comes to medical innovation"

This is perhaps one of the most relevant questions to consider when it comes to private vs public healthcare, and it is often swept under the rug. My thoughts are that research will probably do just fine, under a universal system, primarily because a US solution would most likely be some tax payer backed insurance scheme, as opposed to a managed care type system. In short, that would mean that profits to innovators could still be had, it would just come from tax payers and not private premiums. If anything, research may increase, as profits would be guaranteed by tax dollars. Besides, I have yet to see a healthcare proposal.

Anyway, it is pretty obvious that the US subsidizes the world in a lot of different innovation avenues, medical being one of them.

[Ryan]

“When you move P to G some of the high paid paper pushers in P now have to look for jobs actually providing health care rather then spending all their time trying to figure out how to deny it. With P in G paper pushers will be transformed into orderlies pushing patients, or maybe they'll be pharmacist pushing pills, or nurses pushing meds...but no more pushing paper for profit ....much more efficient.”

It would seem that you’d prefer the administrative costs of government to that of the private sector. I’m not sure what the comparable DWL of the two are to form an educated opinion. There is no reason to assume the job of finding disqualifying conditions wouldn’t remain in the government sector though.

[howard]

to read bj feng, you would think that there is no actual experience to draw upon, that everything must be decided from scratch.

you would also think that, after all, currently it's an easy matter to get a hip replacement funded when you have five months to live.

or you could conclude that there is no point in reading bj feng.

[reason]

These people talking about specific illnesses are way off the plate, it is exactly the other way around. I love discussions that say more people are dying of cancer when the reason is that cancer is mostly a disease of old age and fewer people are dying of other things before hand. And diagnostic measures and recording of diseases can vary between countries. To get the whole picture we SHOULD be looking at mortality rates.

[Ryan]

"To get the whole picture we SHOULD be looking at mortality rates."

After controlling for as many variables as possible, mortality rates may be relevant.

Anyway, to provide a perspective completely different from the blackhole of logic that is the typical private vs public healthcare debate. Here is an interesting interview excerpt, from Bernard Lietaer, on a complimentary currency program used in Japan to take care of elders, and more.

"BL: I gave you that first example-a commercial loyalty currency-only because it would be familiar to most of your readers. But in addition to those commercial private currencies, there are now more than 4,000 communities around the world that have started their own currency for social purposes as well.

For example, there are about 300 or 400 private currency systems in Japan to pay for any care for the elderly that isn't covered by the national health insurance. They are called "fureai kippu" (caring relationship tickets). Here's how they work: let's say that on my street lives an elderly gentleman who is handicapped and cannot go shopping for himself. I do the shopping for him. I help him with food preparation. I help him with the ritual bath, which is very important in Japan. For this help, I get credits. I put those credits in a savings account, and when I'm sick, I can have other people provide such services for me. Or I can electronically send my credits to my mother, who lives on the other side of the country, and somebody takes care of her.

Here is an agreement within a community to use as medium of payment something other than national currencies, to solve a social problem. And it makes it possible for hundreds of thousands of people to stay in their homes much longer than they otherwise could. Otherwise, you'd have to put most of these people into a home for seniors, which costs an arm and a leg to society, and they're unhappy there. So nobody's winning. In contrast, Japan has created a currency for elderly care.

In the United States, Florida is the only state that has the same density of elderly people as Japan does-18 percent of the population is more than 65 years old. But Florida is a model for our collective future. Colorado will be there in 2020. Germany will be there in 2006, France in 2008, Britain in 2012. Partly because of the baby boom generation, and partly because of the fact that health care has improved and people live longer. If you put all of these elderly in homes for seniors, you'd go bankrupt. Japan has been looking for another way, and has found it by introducing a monetary innovation.

Let me give you other examples, already operational here in America today. There are now several hundred "time dollar" operational systems in the United States. The unit of account is the hour. I do something for you. I have a credit for an hour, while you have a debit for an hour. If I can use my credit with someone else, this creates a currency between us. For those people who are willing to give some of their time, the money manifests automatically. It doesn't quite work that way with dollars, does it? One of the two of us has to get dollars by competing for them somewhere outside of our community.

Time dollars are helping in a lot of communities where conventional money is scarce: in ghettos, retirement communities, high unemployment zones, student communities. There are 31 states in America that are paying employees to start such time dollar systems, because it solves social problems. There are some operating in Chicago, fairly big ones in Florida. For example, in Chicago, there are entire neighborhoods that used time dollar systems to create a neighborhood watch system that got rid of drugs and gangs. It's working, it doesn't cost anything to the taxpayer, it doesn't create a huge bureaucracy, and it encourages the solution of the local problems by and with the very people who know most about them."

[rtc]

"It appears to me like we effectively subsidize the rest of the world when it comes to medical innovation - hell, when my Dad got sick in Germany every doctor there was trained in the US - so how do we get around this?"

This is nonsense.

"Anyway, it is pretty obvious that the US subsidizes the world in a lot of different innovation avenues, medical being one of them."

Does this mean that every nation who is the innovation leader in a particular technological sector(mechanical engineering: Germany, Cars: Japan ....) is in fact subsidizing the rest of the world? and that this is a bad thing? I am curious.

[reason]

I don't understand Mark Thoma either. Why is he taking Arnold Kling seriously?

[Ryan]

Does this mean that every nation who is the innovation leader in a particular technological sector(mechanical engineering: Germany, Cars: Japan ....) is in fact subsidizing the rest of the world? and that this is a bad thing? I am curious.

It is definitely benefitting from the work/intellect of someone else. A normative statement wouldn't be prudent and is completely aside the point that is being made.

That point is that a lot of healthcare costs have to to with implementing new technologies, or buying drugs, whose patents aren't expired and generics are unavailable.

Just saying "Oh hey guy look at the Europeans, they have cheaper healthcare," ignores some of the nuances necessary to make valid cost-benefit analysis.

[Linda]

Mark Thoma,

It's past my bedtime, but before I go, I want to thank you for this extremely detailed post. I look forward to reading the comments tomorrow. No doubt I'll have more to say then.

[inthewoods]

"Does this mean that every nation who is the innovation leader in a particular technological sector(mechanical engineering: Germany, Cars: Japan ....) is in fact subsidizing the rest of the world? and that this is a bad thing? I am curious."

Patents change the equation - newer drugs or medical devices can't be made in other countries. Is it a bad thing? Well, it certainly drives up the cost of drugs/medical devices in the US vs. the rest of the world. If we are trying to lower costs, it is something that should be examined.

The other cost aspect that might have to be looked at is lowering the salaries of doctors. Doctors in other countries make less money, and that, in my understanding, accounts for a significant portion of the healthcare spend.

This is particularly true if one looks as specialists in the US vs. primary care doctors - and it accounts for the lack of primary care doctors coming out of medical school. Maybe the cost savings associated with the reduce bureaucracy would cover it - but in my mind this is the other big issue.

I'd love to hear some comments from Mark or others on this aspect.

[anne]

Arnold Kling:

There is health care spending paid for by the private sector. Call it P. There is health care spending paid for by the government. Call it G.

The problem with G is that it is busting the budget.

[Rubbish, rubbish, rubbish.]

[anne]

http://www.epi.org/printer.cfm?id=2806&content_type=1&nice_name=webfeatures_snapshots_20071010

October 10, 2007

War Spending Placed Above Domestic Priorities
By Monique Morrissey

Non-defense discretionary spending as percent of GDP

2002 3.7 initial budget under George Bush
2003 3.9
2004 3.8
2005 3.9
2006 3.7
2007 3.6
2008 3.6

Defense discretionary spending as percent of GDP

2002 3.4 initial budget under George Bush
2003 3.7
2004 3.9
2005 4.0
2006 4.0
2007 4.0
2008 4.3

The figures actually understate the full cost of the "war on terror," because Homeland Security, State Department, and Foreign Operations funding is included in non-defense spending. Significant long-term war costs, for veterans' health care, for example, are also not included.

[anne]

http://www.cbpp.org/3-5-08bud.htm

March 5, 2008

Federal Spending, 2001 Through 2008: Defense Is a Rapidly Growing Share of the Budget, While Domestic Appropriations Have Shrunk
By Richard Kogan

Domestic Discretionary Funding Is a Shrinking Share of Total Program Costs

Share of Total
2001
2008
Change

Defense & security
21.7%
29.2%
+7.5%

Social Security, Medicare/caid
45.9%
43.5%
-2.4%

Other mandatory programs
14.0%
12.5%
-1.4%

Domestic discretionary
18.4%
14.7%
-3.7%

[anne]

http://www.cbpp.org/2-20-08bud.htm

February 20, 2008

President's Budget Would Cut Deeply Into Important Public Services and Adversely Affect States: Many Cuts Come on Top of Sizable Reductions in Recent Years
By Sharon Parrott, Kris Cox, Danilo Trisi, and Douglas Rice

In 2008, funding for domestic discretionary programs outside homeland security is lower as a share of the economy than it was in 2001. And, between 2002 and 2008, the overall funding level for domestic discretionary programs outside homeland security declined 2.6 percent in real per capita terms....

[anne]

http://www.cbpp.org/3-5-08bud.htm

March 5, 2008

Federal Spending, 2001 Through 2008: Defense Is a Rapidly Growing Share of the Budget, While Domestic Appropriations Have Shrunk
By Richard Kogan

Domestic Discretionary Funding Has Been Growing More Slowly Than Any Other Set of Programs

(Average annual rate of growth, from 2001 through 2008)
nominal
real
real per person

Defense & security
12.0%
9.1%
8.1%

Social Security, Medicare/caid
6.5%
3.8%
2.8%

Other mandatory programs
5.7%
3.0%
2.0%

Domestic discretionary
4.0%
1.3%
0.3%

Average, all program costs
7.3%
4.6%
3.6%

[anne]

http://www.cbpp.org/3-5-08bud.htm

March 5, 2008

Domestic Discretionary Funding is a Shrinking Percentage of the Economy

(% of GDP)
2001
2008
Change

Defense & security
3.6%
5.6%
+2.0%

Social Security, Medicare/caid
7.7%
8.4%
+0.7%

Other mandatory programs
2.3%
2.4%
+0.1%

Domestic discretionary
3.1%
2.8%
-0.2%

Total program costs
16.7%
19.3%
+2.6%

[Ryan]

Anne, I'm not entirely sure what the point of your wall of text spams were exactly, but it goes without saying that in "wartime", defense expenditures will increase, likely in enormous amounts.

Because of the magnitude of the increase, the ratio of other expenditures to GDP are going to experience downward pressure. That is just basic math.

Of course, looking at expenditure as a portion of GDP is rather meaningless, and increases, relative to the past are what matters. Most spending is up, year on year, and when the war finally ends (it will eventually end, or at least be a small occupation) defense cuts will happen and those ex/gdp numbers will go way up.

[Let's Get Real]

What reason said. Anyone with any familiarity with Kling's output knows that he's not understanding because he doesn't want to. All he wants to so is conclude that government is in all cases bad and he'll do whatever it takes to get what he wants.

The only sensible thing to do about Kling is to ignore him.

To Robertdfeinman:

"One has to wonder whether Kling's consistent misunderstandings of how things work are failures in his education or ideologically motivated deliberate distortions."

No, one doesn't have to wonder. The answer is "ideologically motivated deliberate distortions." Believe it or not, Kling has a PhD in economics from MIT. Unless standards there have fallen drastically I don't think it's fair to blame them.

[save_the_rustbelt]

Anecdotal information does not create evidence, but enough anecdotes start to look like a trend.

In the past week, speaking to people around the country involved in health care, there seems to be a growing trend that in communities of say less than 40,000 people, surgeons cannot make a living, and are either retiring or moving to larger cities. A future research topic to be certain.

As revenue is compressed and office expenses rise, it is increasingly difficult to make a living, especially for general surgeons. G-surgeons are especially important because they are the first called for trauma cases.

This is the sort of issue that economists and political scientists miss altogether, because they are taking a very wide macro view.

Whoever takes the presidency, I fear that a health plan designed from a macro view could cause immense damage at the operational level, not due to bad intentions but due to lack of knowledge.

The current system evolved over 60 years, we need to be careful when we try to fix it.

[save_the_rustbelt]

"The other cost aspect that might have to be looked at is lowering the salaries of doctors."

This is already in process, in a helter-skelter manner, and the results will not be good.

[anne]

Ryan:

I will never take any healthcare comparisons between the USA and any other country seriously unless obesity is controlled for....

[Imagine my surprise, keep on though....]

[anne]

Arnold Kling:

There is health care spending paid for by the private sector. Call it P. There is health care spending paid for by the government. Call it G.

The problem with G is that it is busting the budget.

[This is a lie.]

Of course, an economic policy that precludes the spending of a mere $7 billion to insure the health of 3.8 million needy children for the sake of spending $162 billion more on needless wars in and occupations of Afghanistan and Iraq has everything to do with our immediate well-being and even with our international competitiveness.

[anne]

"I will never take any healthcare comparisons between the USA and any other country seriously unless obesity is controlled for...."

Ooooh, I forgot....

[macquechoux]

Mark does that 4% figure include its pro rata share of general government overhead? It cost something to collect the taxes that fund Medicare & Medicaid. There are buildings as well as general government expenses that without which Medicare and Medicaid would not exist. Somehow I don't think these expenses are being allocated in the 4% figure.

Finally being an old man with a extremely old mother it is my observation that most medical expenses are usually occur at the last stages of life and end of life. Canada, the UK, and France deliberately limit funds in this area where here in the US we do not.

Anyway, I enjoyed the read and I am waiting to see if Arnold has anything more to say.

[piglet]

Thanks for that IMF reference, Patricia. As I already wrote on the other thread, the question is, are economists paying any attention to these data? Are they paying attention to empirical facts that run counter to their theories (or dogmas or ideologies or however you prefer to call them)? Are they even capable of admitting that they were wrong?

As a side note to the "recent (sic!) report from the Center for Global Development": this has been known and criticized for 20 years at least. I learned these facts in college in the early 1990s. Not in an economics class, though.

[swells]

I am highly suspicious of the efficiency arguments for universal health care. The government runs schools. How efficient are these schools (when there are so many dumb adults)? The government runs the military. How efficient is the military (when Halliburton et al are required for the conquest of Iraq)? The government runs infrastructure like highways and bridges. How efficient is the infrastructure (when individual cars are favored over mass transit).

Maybe I'm just stupid but arguing for universal healthcare on the basis of it being more efficient assumes a competence in government that just isn't borne out by the facts as I understand them.

[ddt]

swells,

our Canadian administration is completely useless, but we STILL save money. It's a no-brainer. It's really that simple. No matter how badly it is run, it will be significantly more efficient by its very nature (as explained by Mark above). The savings are so massive that any administrative inefficiency is dwarfed.

[howard]

swells, what you need to do is educate yourself about what insurance companies do all day and then you'll understand better.

[swells]

DDT, I don't know. For me, it's pretty simple. I think that the government here in the US is doing a lousy job with most everything it is responsible for doing. I think that is because people in the US are, for the most part, stupidly egocentric and elect politicians who are just like them.

[muirgeo]

Arnold Kling wrote, "The problem with G is that it is busting the budget."

If this were true then his post would have some merit. But the claim requires ignoring all the other aspects of the budget that may be "busting it".

As far as budgets go I know of many family budgets that have been busted by P. I know of no family budgets or governmental budgets that have been busted by G.

If the concern is busting budgets increasing G while deleting P will save many budgets and bust none.

But also I believe the main point of Mr. Thoma post was not specifically about budgets and was more on overall efficiency and delivery of health care which 30 other developed nations experience suggest will be improved by a national health care policy. And curiously none have busted budgets.

[swells]

Howard, I'm pretty familiar with what insurance companies do every day. My insurance routinely denies every claim submitted to them requiring me to waste time to get things paid for. I get notices all the time telling me they've paid Y amount of dollars in claims and never once mentioning that I have paid 4 times Y in premiums during the same period. That sucks. And yes, I do understand they try to enhance their risk profile by excluding pre-existing conditions to the extent they can and by simply not accepting people who are likely to cost them money.

I'm not a naif.

My basic point is that stupid is as stupid does and until people in the US get less stupid things aren't going to change much no matter how things are done.

Don't misinterpret what I'm saying. I favor universally available health care and I don't think it will cost anymore to get it than I already pay.

[save_the_rustbelt]

One of the dangerous assumptions is that billing the government will be a lot more efficient than billing private health care companies.

There will be some efficiencies, especially in set up time, but beyond that there are no guarantees.

The other scary part about both McCain and Obama is the concept of mandatory EMR. I'm currently about 50 pages into a a paper on why that could be a disaster, and how providers could cope with the fallout (a bad EMR install can kill the billing system, resulting in a meltdown).

[macquechoux]

DDT what is the cost of, "We STILL save money?" How many Canadians come to the US for medical treatment? I do believe that is a direct result of your excellent cost savings. How many die waiting for treatment? How many lives are shortened because of long queues? How much misery and suffering are the result of long queues? Care to put a dollar figure on that? As I recall it took the highest court in Canada to rule that citizens had the right to buy health insurance, which your cost saving government was denying them, in the name of saving money. Maybe if you were in one of those long queues with a painful, life threatening disease you might not be quite quite so boastfull of how much money Canada STILL saves as compared to the US.

[anne]

"How many Canadians come to the US for medical treatment? I do believe that is a direct result of your excellent cost savings. How many die waiting for treatment? How many lives are shortened because of long queues? How much misery and suffering are the result of long queues? Care to put a dollar figure on that?"

Reference to the lying???

[reason]

swells...
The problem with your argument is that "the government" is not some homogenous agency. All insurance providers whether government or private are burocracies. What makes one more efficient (for a user) than another, is not just a question of whether it is profit driven or not.

[reason]

anne that is not the correct answer to the "long queues" meme. The correct answer is that in the US the queues are shorter because the poor can't afford to get on the queue in the first place.

[reason]

In other words the argument is - "you and I are part of the elite, we shouldn't have to share with the riff-raff".

[anne]

"How many Canadians come to the US for medical treatment?"

Twenty-three? Fourteen? Nine?

[reason]

Strip down arguments to their essentials and let them stand there naked.

[ddt]

macquechoux,

You don't think we've heard all those naysaying libertarian talking points a million times?

And a million times over the Canadian people have overwhelming decided that even with any inconveniences the system is far more efficient and MORAL even if that means every one has an equal chance of having to deal with a wait time. It's better than in the US where if you are poor you just die from curable but expensive conditions.

The Canadian system could always be better, just like any system, but no one would be stupid enough to trade it for the nightmare that is the American system.

[ot]

Anne - Canadians do go to the United States for treatment on a regular basis. I don't have statistics but I know of several people who recently went. Some were for second opinions - the type where you get diagnosed with cancer and you go to the Mayo Clinic looking for a miracle - some were cosmetic - face lift kind of stuff - and some were for knee and hip replacements. (I must confess the old folks stuff is through my mother)

There are also a number of non traditional medical procedures available in places like California only.

The plural of anecdote is not data, but please stop with the "lie" bit.

[anne]

Arnold Kling:

"There is health care spending paid for by the private sector. Call it P. There is health care spending paid for by the government. Call it G.

"The problem with G is that it is busting the budget."

"How many lives are shortened because of long queues? How much misery and suffering are the result of long queues? Care to put a dollar figure on that?"

[This is lying. Get it?]

[anne]

Truth....

http://www.cbpp.org/3-5-08bud.htm

March 6, 2008

Federal Spending, 2001 Through 2008: Defense Is a Rapidly Growing Share of the Budget, While Domestic Appropriations Have Shrunk
By Richard Kogan

Domestic Discretionary Funding Is a Shrinking Share of Total Program Costs

Share of Total
2001
2008
Change

Defense & security
21.7%
29.2%
+7.5%

Social Security, Medicare/caid
45.9%
43.5%
-2.4%

Domestic Discretionary Funding Has Been Growing More Slowly Than Any Other Set of Programs

(Average annual rate of growth, from 2001 through 2008)
nominal
real
real per person

Defense & security
12.0%
9.1%
8.1%

Social Security, Medicare/caid
6.5%
3.8%
2.8%

Domestic Discretionary Funding is a Shrinking Percentage of the Economy

(% of GDP)
2001
2008
Change

Defense & security
3.6%
5.6%
+2.0%

Social Security, Medicare/caid
7.7%
8.4%
+0.7%

Addendum, revenues
19.8%
18.5%
-1.3%

[anne]

http://www.cbpp.org/3-5-08bud.htm

March 6, 2008

Federal Spending, 2001 Through 2008: Defense Is a Rapidly Growing Share of the Budget, While Domestic Appropriations Have Shrunk
By Richard Kogan

There has been no rapid rise in funding for domestic discretionary programs in recent years; in fact these programs have shrunk both as a share of the budget and as a share of the economy.

In contrast, funding for defense and related programs has exploded. Since 2001, it has jumped at an annual average rate of 8 percent, after adjusting for inflation and population — four times faster than the average rate of growth for Social Security, Medicare, and Medicaid (2 percent), and 27 times faster than the average rate for growth for domestic discretionary programs (0.3 percent).

Funding for defense and related programs has shot up by 2 percent of GDP in just seven years. It is expected to take more than two decades for Social Security to grow by 2 percent of GDP.

Even when costs for Iraq, Afghanistan, and the "global war on terror" are excluded, funding for the regular defense budget has risen at a stunning rate that dwarfs the growth rates for all parts of the domestic budget.

The combined effect of the Administration's tax cuts and its defense spending increases (including the war) has been a budget deterioration equal to 3.3 percent of GDP since 2001. By contrast, increases in costs for all domestic programs combined have cost a little less than 0.6 percent of GDP.

[macquechoux]

Anne, maybe the correct question is how many Canadians can afford to come to the US? I am not very proficient at using Google but here are a few facts that I found immediately:

"Why is the hip replacement center of Canada in Ohio–at the Cleveland Clinic, where 10% of its international patients are Canadians … Why is Brain and Spine Center in Buffalo serving about 10 border-crossing Canadians a week?" (Sounds like 520 a year to me, Anne.)

"A dozen Canadians took a bus last week for a day trip from Saint John, New Brunswick, to Bangor, Maine. It wasn't a pleasure trip. The 12 were all suffering serious medical maladies and desperately seeking healthcare solutions -- doctors' appointments, treatment and prescription drugs -- that couldn't be had in Canada."

"High US prices, Long Canadian waits, send patients to Cuba."

Another mentions 640 Canadians getting ocular surgery in the US, the survey being only in large US cities close to the border.

Personally I don't think you will find a decent survey because I don't think the Canadian government, the logical one to do so, would be the least bit interested in getting the results.

Long waiting queues is a nationally recognized problem in Canada.

Anne your comment of, "Twenty-three? Fourteen? Nine?" is just plain silly and you know that.

[JeffF]

"Ryan:

I will never take any healthcare comparisons between the USA and any other country seriously unless obesity is controlled for...."

Sigh. Yet another self-imposed-ignorance based defense of the worst health care system in the wealthy world.

Canadians are actually slightly fatter than Americans, and follow the well established pattern of spending far less than we do for similar health care results under universal coverage.

Heck, in the US the government covers the oldest, fattest, sickest 1/3 or so of the population for 1/3 of the money which is an astounding achievement in itself.

[ddt]

"Canadians are actually slightly fatter than Americans"

No way man. that's just totally wrong - and we even have a large native population that is genetically predisposed to obesity (that's why the northern territories of Canada are higher in obesity).

http://eaves.ca/2008/07/08/fatness-index-canada-vs-united-states/

[anne]

Please....

http://www.ipi.org/ipi/IPIPressReleases.nsf/0/5350615e774d6ff285256c0f006967e4?OpenDocument

August 1, 2002

Opinion from the Institute for Policy Innovation

On a Bus to Bangor, Canadians Seeking Health Care
By Merrill Matthews Jr.

A dozen Canadians took a bus last week for a day trip from Saint John, New Brunswick, to Bangor, Maine. It wasn't a pleasure trip. The 12 were all suffering serious medical maladies and desperately seeking healthcare solutions -- doctors' appointments, treatment and prescription drugs -- that couldn't be had in Canada.

Fifty-year-old Rod has chest pain and shortness of breath. He also has a heart murmur and X-rays suggest he has a hole in his heart. His cardiologist referred him for an echocardiogram but he was told he had to wait until November to get one in Canada. A fellow traveler was a 66-year-old breast cancer patient. Her family physician had recently left his practice and without him she couldn't access the system. A third patient had had an MRI in Canada which revealed a disk pushing on her spinal cord. When her doctor referred her to an orthopedic surgeon, she was put on an eight to 12 month waiting list.

Washington politicians have made much recently of bus trips to Canada to buy cheap prescription drugs but what about the buses loaded with sick Canadians, going the other way? When it comes to responding to the challenges in today's U.S. healthcare system, it is clearer than ever that Canada is not the place to look....

Merrill Matthews Jr. is a visiting scholar for the Institute for Policy Innovation in Dallas and director of the Council for Affordable Health Insurance in Alexandria, Va.

says...

Institute for Policy Innovation and Council for Affordable Health Insurance are respectively Richard Armey's supposed think tank and a private insurance company supposed think tank. There is no reason to believe what is termed "opinion" has the least truth since there is no source.

I understand the game, and accept the problem that Canadians are too poor and too stupid and entirely too lacking communistic to do more than whimper for penicillin when radical corrective surgery is called-for (no wonder there are no old Canadians), but please enough of this stereotypical rubbish that masks an entirely different agenda. *

* No Canadians were harmed in writing this entry, though that is only because none are close enough to harm just now.

[anne]

Well, that was really me.

[swells]

reason, have to admit I'm confused. I think the point I was trying to make is that irrespective of which bureaucracy, private or public, administers health insurance we are being kind of silly if we expect better than we deserve. It's the thing about liberalism that concerns me the most, the notion that institutions can or should provide more than is deserved. I have no trouble with systems that recognize people have rights and then endeavor to deliver in protecting those rights. It should be extremely possible to devise a health care system that took that approach and for the costs to be fair and fairly apportioned.

It just seems to me that efforts to do so are foundering because a lot of people, if not a majority, thinks they are entitled to more than they deserve.

[anne]

"It just seems to me that efforts to do so are foundering because a lot of people, if not a majority, thinks they are entitled to more than they deserve."

Like, say, medical care. Why though is it that through the rest of the developed world everyone thinks they deserve medical care and gets it? Only in America, nobody deserves anything.

[howard]

swells, i'm glad you're not a naif, but really, i can't figure out what you are: what does "stupid" have to do with this? the insurance companies aren't being "stupid;" they're doing what makes sense for their bottom lines.

as for what we "deserve," i have no idea what you're saying: we "deserve" the very best. achieving the very best is extremely difficult (well, probably impossible).

it's not as if we don't have some empirical evidence right here in the us of a from medicare and veteran's health care, that there is a higher degree of efficiency from a bureaucratic standpoint.

although bureaucracies have sociological consistencies, ultimately they are responsive to the circumstances in which they function. the insurance companies want a bureaucracy that will deny claims; that's what they get.

that doesn't mean a universal health care bureaucracy would operate under the same dictates.

[mik]

macquechoux says...

How many Canadians come to the US for medical treatment?

See here:
content.healthaffairs.org/cgi/content/full/21/3/19?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=snow&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT

From that paper it appears that Canadians coming for elective care and paying themselves are relatively few, may be a few hundred / year, may be a thousand.
Very small portion (0.1% - 0.5%) of all Canadians getting similar care in Canada.

Much large number are coming in to get care contracted for by their provinces. Provinces often choose to contract with US medical facilities across the border instead of building one themselves.
Probably makes sense in case of relatively rare diseases and expensive facilities.
So, that number could be as high as 5-10% for some diseases.

But I guess those Canadians are not the ones you referring to.

[anne]

http://www.townhall.com/columnists/BillSteigerwald/2007/09/01/uh-oh,_canada?page=full&comments=true

September 1, 2007

Uh-oh, Canada
By Bill Steigerwald

[Good grief; there is so much more of the Canada is and Canadians are dying of lack of healthcare material, all with no possible reason to believe there is the least truth to the fierce stories, but what is truth from the sort of writers who bounce from bashing Canada to proving climate change really isn't, just isn't because it's really just the sun?

Anyway, references help at least show us where the anecdotes come from.]

[anne]

Ah, thank you so much for the reference:

http://content.healthaffairs.org/cgi/content/abstract/21/3/19?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=snow&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT

May, 2002

Phantoms In The Snow: Canadians’ Use Of Health Care Services In The United States
By Steven J. Katz, Karen Cardiff, Marina Pascali, Morris L. Barer, and Robert G. Evans

To examine the extent to which Canadian residents seek medical care across the border, we collected data about Canadians’ use of services from ambulatory care facilities and hospitals located in Michigan, New York State, and Washington State during 1994–1998. We also collected information from several Canadian sources, including the 1996 National Population Health Survey, the provincial Ministries of Health, and the Canadian Life and Health Insurance Association. Results from these sources do not support the widespread perception that Canadian residents seek care extensively in the United States. Indeed, the numbers found are so small as to be barely detectible relative to the use of care by Canadians at home.

[anne]

Thanks to Mik:

http://content.healthaffairs.org/cgi/content/full/21/3/19?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=snow&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT

May, 2002

Phantoms In The Snow: Canadians’ Use Of Health Care Services In The United States
By Steven J. Katz, Karen Cardiff, Marina Pascali, Morris L. Barer, and Robert G. Evans

Discussion

A tip without an iceberg? This study was undertaken to quantify the nature and extent of use by Canadians of medical services provided in the United States. It is frequently claimed, by critics of single-payer public health insurance on both sides of the border, that such use is large and that it reflects Canadian patients’ dissatisfaction with their inadequate health care system. All of the evidence we have, however, indicates that the anecdotal reports of Medicare refugees from Canada are not the tip of a southbound iceberg but a small number of scattered cubes. The cross-border flow of care-seeking patients appears to be very small....

[The entire paper....]

[anne]

Please do read this paper completely, if possible:

http://content.healthaffairs.org/cgi/content/full/21/3/19?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=snow&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT

May, 2002

Phantoms In The Snow: Canadians' Use Of Health Care Services In The United States
By Steven J. Katz, Karen Cardiff, Marina Pascali, Morris L. Barer, and Robert G. Evans

Introduction

For more than a decade anecdotal reports of waiting lists for elective procedures in Canada and of hordes of Canadian "Medicare refugees" crossing the border in search of medical care in the United States have provided emotive fuel for critics of the Canadian health care system from both sides of the border.1 American opponents of universal public coverage have argued that global constraints on capacity and funding force many Canadians to cross the border in search of services that are unavailable or in short supply in their own country.2 Some have gone so far as to suggest that the widening health care spending gap between Canada and the United States is partly the result of counting expenditures by Canadian Medicare refugees in the U.S. rather than the Canadian expenditure totals, although there is an extensive body of evidence showing that the sources of the spending gap lie elsewhere.3

The Medicare refugee story is harnessed in Canada to promote the message that the Canadian health care system (known as Medicare) is chronically under-funded; the refugees are but one prominent symptom. The Canadian "under-fundists" are, however, divided as to the appropriate response. The many who support the fundamental principles on which Canadian Medicare is built argue that Canadian waiting lists and care seeking in the United States demonstrate the need for new public funds to increase capacity and services. While "evidence" in the form of Medicare refugees might be new, this debate about the level of public funding has been part of the dialogue between Canadian providers and provincial payers throughout Canadian Medicare's history.4

But the putative refugees are also pawns in a debate driven by Canadian opponents of universal public funding, who wish to expand the role of private financing. This debate grew more intense during the 1990s as provincial payers increasingly constrained their health care budgets.5 News headlines suggesting that Canadians spend more than $1 billion annually south of the border have been cited to bolster the argument that private funding would reduce the pressure on the public system, thus reducing both public waiting lists and the flow of Canadians heading south for care. As a bonus, that $1 billion would stay at home.6

Unfortunately, this persuasive image of Canadian refugees survives in a virtual vacuum of evidence. How many Canadians actually head to the United States to seek medical care that they cannot obtain, or are unwilling to wait for, in Canada? What kinds of services do they receive? Where do they get these services, and how do they pay for them?

The paucity of answers to these questions is a result of large conceptual and empirical challenges facing researchers who attempt to fill in the gaps. Tens of thousands of Canadians enter the United States each year for a number of reasons unrelated to medical care seeking, such as holidays, business, education, or shopping. Any of these visitors might require medical care coincidentally while outside Canada. Thus, one must identify the context of Canadians' medical care use in the United States to separate Medicare refugees from business travelers, "snowbirds," and holiday seekers....

[Patricia Shannon]

Piglet, my experience that most people are very resistant to changing ideas once they reach adulthood. They will cling fast to ideas that have proven utterly false even in their own lives. It probably has genetic roots. Eg., people who decided to test food taboos for themselves would have had shorter life expectancies, since many food taboos would have valid. But some individualistic thinkers are necessary because conditions change, and for the sake of improving fitness. Someone who studies different cultures might be able to tell us if culture is able to significantly counteract this tendency. I expect so. It is common in at least some parts of our culture for children who are not passive acceptors of authority to be punished.

Even in science, it is said that new paradigms are accepted not because of convincing the existing scientists that the old theory was wrong or inadequate, but because the old scientists retire or die, and young ones, who don't yet have their fixed ideas, take their place.

This might be an example of how the evolution can lead to negative outcomes in the long-run. Professor Thoma had a link to that recently, but to my disappointment, it was, as usual, hijacked by Anne for posting her anti-Irag war posts, as if there are many people reading this blog who are for the war. So I didn't see any comments about the negative evolution article. I was too busy at work to comment on it, as I have long felt that humans are proving themselves to be an example of this phenomenon.

[Patricia Shannon]

Swells, I'm curious. Do you think private business is doing a great job of managing the well-being of the country and world?

[Patricia Shannon]

http://en.wikipedia.org/wiki/List_of_countries_by_life_expectancy

life expectancy at birth
Canada = 80.34
U.S. = 78.06

[Patricia Shannon]

I have to go home and get some sleep, but someone with more time to spare should be able to find info on Americans going to other countries, such as India, for surgery, to save money.

[Patricia Shannon]

Medicaid benefits depend on the state.
In Georgia, when I was out of work and needed cataract surgery, all the state could do for me was give me two forms to apply for private charity helpI was already legally blind in one eye, and rapidly getting worsein the other eye. Maybe there would have been aid available once I became legally blind in both eyes, I don't know.

Fortunately, I was able to get a job and save enough money just in time. By that time, my "good" eye was right on the boundary of being legally blind (which means after corrected with glasses, it was still less than the defininition, 20/80 I think).

BTW, you can't get federal medicare benefits until two years after you qualify for disability benefits.

Georgia Medicaid eligibility limits are at:
http://dch.georgia.gov/vgn/images/portal/cit_1210/57/19/1045153492008_Financial_Limits.pdf

I don't have time to find out what the "LIM" column is.
So the eligibility limits for Georgia Medicaid for a single-person household are
monthly : $208 or $238
annual : $2496 or $2820
resources limit : $1000 (I don't know if owning my mobile home counts)

[anne]

Patricia Shannon:

Medicaid benefits depend on the state.

Georgia Medicaid eligibility limits are at:

http://dch.georgia.gov/vgn/images/portal/cit_1210/57/19/1045153492008_Financial_Limits.pdf

So the eligibility limits for Georgia Medicaid for a single-person household are

monthly : $208 or $238
annual : $2496 or $2820
resources limit : $1000

[Wow.]

[Dave]

Dear Dr. Thoma,

Thanks for supporting a limitation of my choices in health care. I'm sure the government is capable of solving the economic calculation problem inherent to the nationalization of health insurance. Everything the government runs is so efficient and pleasant that I'm sure that I would trust them to decide which tests and procedures I should be allowed when I'm in need. Everything's better when the government is involved, because incentives cease to matter when you remove the evil free market, right?

Thank you for also not considering the possibility that the plethora of regulations by our infallible law makers constricting the freedom of private insurers are creating poor incentives that are at the root of our spiraling health care costs.

You are the smartest man alive.

[reason]

Dave,
we don't need any more trolls. You are surely intelligent enough to know that the issue is more complex than you are painting it, and that there is a reason that regulation was introduced in the first place. While you are quoting wikipedia, you should look up "adverse selection".

[anne]

Dave:

"Dear Dr. Thoma,

"Thanks for supporting a limitation of my choices in health care."

This is more lying; lie on, lie on.

[anne]

The criticism is important to remember, because it will be repeated criticism. First, there is a purposeful distortion of the portion of government spending for health care and the degree to which such spending is a problem. Second, there is a distortion about the effectiveness of the Canadian health care system since comparison with the American system is considered threatening. Third, there is a distortion of the wish of health care insurance reformers to limit choice when increasing health care insurance coverage will only add to choice.

The problem in reforming our health care insurance system, is the methodical, continual dishonesty in attacking any and every proposal for reform.

[anne]

"Personally I don't think you will find a decent survey because I don't think the Canadian government, the logical one to do so, would be the least bit interested in getting the results."

http://content.healthaffairs.org/cgi/content/full/21/3/19?maxtoshow=&HITS=10&hits=10&RESULTFORMAT=&fulltext=snow&andorexactfulltext=and&searchid=1&FIRSTINDEX=0&resourcetype=HWCIT

May, 2002

Phantoms In The Snow: Canadians' Use Of Health Care Services In The United States
By Steven J. Katz, Karen Cardiff, Marina Pascali, Morris L. Barer, and Robert G. Evans

PROLOGUE

Over the past three decades, particularly during periods when the U.S. Congress has flirted with the enactment of national health insurance legislation, the provincial health insurance plans of Canada have been a subject of fascination to many Americans. What caught their attention was the system's universal coverage; its lower costs; and its public, nonprofit administration. The pluralistic U.S. system, considerably more costly and innovative, stands in many ways in sharp contrast to its Canadian counterpart. What has remained a constant in the dialogue between the countries is that their respective systems have remained subjects of condemnation or praise, depending on one's perspective.

Throughout the 1990s, opponents of the Canadian system gained considerable political traction in the United States by pointing to Canada's methods of rationing, its facility shortages, and its waiting lists for certain services. These same opponents also argued that "refugees" of Canada's single-payer system routinely came across the border seeking necessary medical care not available at home because of either lack of resources or prohibitively long queues.

This paper depicts this popular perception as more myth than reality, as the number of Canadians routinely coming across the border seeking health care appears to be relatively small, indeed infinitesimal when compared with the amount of care provided by their own system....

The authors acknowledge financial support from the Canadian Institutes of Health Research (formerly the Medical Research Council of Canada) for this research.

[anne]

About choice, by the way:

http://www.businessweek.com/magazine/content/08_31/b4094000643943.htm

July 23, 2008

How Insurance Companies Dig Up Applicants' Prescriptions—and Use Them to Deny Coverage
By Chad Terhune

That prescription you just picked up at the drugstore could hurt your chances of getting health insurance.

An untold number of people have been rejected for medical coverage for a reason they never could have guessed: Insurance companies are using huge, commercially available prescription databases to screen out applicants based on their drug purchases.

Privacy and consumer advocates warn that the information can easily be misinterpreted or knowingly misused. At a minimum, the practice is adding another layer of anxiety to a marketplace that many consumers already find baffling. "It's making it harder to find insurance for people," says Jay Horowitz, an independent insurance agent in Overland Park, Kan.

The obstacle primarily confronts people seeking individual health insurance, not those covered under an employer's plan. Walter and Paula Shelton of Gilbert, La., applied to Humana (HUM) in February. They were rejected by the large Louisville insurer after a company representative pulled their drug profiles and questioned them over the telephone about prescriptions from Wal-Mart Stores (WMT) and Randalls, part of the Safeway grocery chain, for blood-pressure and anti-depressant medications.

Mental Health Is a Red Flag

Walter Shelton, a 57-year-old safety consultant in the oil and gas industry, says he tried to explain that the medications weren't for serious ailments. The blood-pressure prescription related to a minor problem his wife, Paula, had with swelling of her ankles. The antidepressant was prescribed to help her sleep—a common "off-label" treatment doctors advise for some menopausal women. But drugs for depression and other mental health conditions are often red flags to insurers.

Despite his efforts to reassure Humana, the phone interview with the company representative "just went south," Walter recounts. He and his wife remain uninsured.

"I want to know what's in there if there's a black mark against us," Walter says. Paula, 51, adds: "We can't get health insurance because we're taking medications that were prescribed by our doctors. I don't think that's right."

A spokesman for Humana says the company uses "data regarding pharmacy history as part of our assessment process." But he adds that the insurer has a policy of not commenting on particular cases, such as the Sheltons' failed application....

[anne]

About rationing, by the way:

http://delong.typepad.com/sdj/2007/04/falling_indicat.html

April 23, 2007

Falling Indicators of Human Development in Mississippi
By Brad DeLong

There are 2.8 million people in Mississippi. About 15% of the non-elderly population--make that 350,000--were on Medicaid.

Cut Medicaid enrollments by 50,000, by 1/7.

42,000 babies born in Mississippi each year.

For the share who die to jump from 0.97% to 1.14%... That's a less than 1/3000 chance.

That's worth saying.