Learning from Lincoln

I you were to listen to me talk about health care these days, you would think I was a democrat. I have plenty of family and friends that can tell you I am not. I believe in small government, self-regulation, low taxation, personal freedom. and taking responsibility for myself (versus blaming others).

I think we can create the society we want but it requires all of us participating fully and doing our fair share. That means voting, paying our taxes, contributing to our communities, and not blaming (suing) someone else at every opportunity. We have to look to our culture and social norms to regulate our society and look less to the law. If we could all just do what is "right" many of the problems in our society would be significantly reduced or just disappear.

I believe the current crisis in health care is due to government's well-intentioned interference in the marketplace. I think the market place is self correcting and that economic laws are as real as the laws of physics. If you interfere with natural economic laws, there may be unintended consequences. I also understand that the complexity of our world is such that no one can understand it all and that, just as there are destructive tumors, market forces can also get out of hand and create havoc. There needs to be some regulation of industry.

I believe that market interference post 9/11 (via the Fed) is largely why we have had the recent real estate bubble. Market interference (via Medicare's indirect price controls) is why we are dealing now with a collapsing health care system. (And if you don't think our health care system is collapsing, you need to walk in my shoes and speak with the people I speak with every day. Effectively, we don't have self clearing markets in health care.)

The best way to understand markets that don't clear (i.e. don't find a natural equilibrium) is to look at the communist system. I remember going to China to negotiate a possible joint-venture duck farming operation. At the time China was a planned economy and one of the things they did not produce enough of was duck. They had plenty of chicken, but not enough duck. When I asked about pricing, duck was priced less than chicken. I asked why they did not raise the price and the answer was that pricing duck less than chicken was politically more popular. (Sound familiar? Keeping medical costs low is politically popular...so we set medicare reimbursement prices low; insurance companies tie their reimbursement schedules to Medicare prices...and the next thing you know we don't have market clearing prices.) In a nutshell, that is the problem -- central planning (Medicare and Medicaid -- medical welfare) tends to distort market forces.

Health care providers give up family life and outside activities to care for their patients. They HAVE to or they could loose everything in a law suit. They are working twice as hard to make half the money, so they stop being providers. Now we have increasing demand for health care services (as technology improves), a small supply f properly trained and licensed providers, and a ceiling on prices. Does trying to see a doctor these days or going to the hospital emergency room remind you of getting into a Russian bread line? That's what happens when you don't have market clearing mechanisms working properly.

Providing health care services has become some screwed up that even insurance has become unaffordable for many many people. This problem is only going to get worse. The problem has to be fixed somehow -- and the best answer is probably going to have to be to remove government price regulation and interference. Too many doctors are quiting the health care profession (read supply is dwindling) because they are being forced to practice medicine in a certain way and not reaping the rewards for their hard work. Insurance companies and pharmaceutical manufacturers are creating havoc and hurting all of us with their lobbying and special interest activities.

The best example of how sick things are is the advertising being done to push new drugs. Why is Plaxix and Cialis and Viaga and Celebrex being constantly advertised on TV? Shouldn't your doctor make the medical decision about what drugs you take or what treatment you have or what tests are appropriate? In my case, if Scott decided that the best treatment for me next was Avastin, my insurance would not pay for it...and one infusion could cost up to $15,000! (The insurance companies have decided that Avastin can only be used on metastatic disease...not the primary tumor. Who says so? If Scott and I want to try it, should I not be allowed to use my insurance dollars in this way? That would be like my property insurer telling me what kind of paint I can use on my house after a hurricane has struck.)

Anyway, something has to be done. I am afraid the treatment is going to have to be radical and it is going to be very very painful and unpopular.

For example, I think Medicare should be for the very poor and disabled and should provide only limited (i.e. not first class) services. Everyone should have access to care...but not all care needs to be equal. If you are rich, you can afford a Lincoln Continental. If you are poor you might have to ride in a Ford Focus or take a bus. No one said you are entitled to a limo if you are poor.

I think wealthy and affluent retirees should have to continue to pay for their own medical insurance. I think there should be a way that allows for group insurance for unrelated people though perhaps a government-sponsored group insurance program that has no medical underwriting. I think that medical insurance premiums need to be regulated. But mostly, I think the government needs to be thinking out of the box with new strategies -- finding ways to provide care to people who don't want private insurance (al la community clinics, hospitals and pharmacies). If you want better than the minimum the government provides. If you want the best, you will have to pay for it.

I don't have the answers, but I have a lot of questions about why more is not being done. For example, what about the government paying off student loans for doctors and nurses who would volunteer to work in a network of government sponsored clinics and hospitals? What about federal tort reform that would make suing a doctor that volunteers his or her time impossible -- or at least indemnifying doctors who are sued over volunteer work. What about reducing patent protection for pharmaceutical companies that waste research dollars advertising the drugs they discover? What about some regulation that gives medical insurers less say about reimbursement pricing or, better yet, allowing the patient discretion on how they want to spend their insurance dollars -- giving some incentive to shop around on their own. What about federal charges against doctors who demonstrate a pattern of abusing the system by making un-needed referrals for tests and procedures just to create traffic and income. What about a law that says hospitals can legally refer non-life threatening emergency room patients to a community health clinic and be afforded protection from law suit. What about a law that makes it incumbent on every local county government to provide some system of primary care -- just like we force local government to provide elementary school education.

I have been listening to the Presidential candidates. When is the REAL debate on this going to begin? After reading "Team of Rivals" and how Lincoln dismantled slavery, I got to thinking that we need a real visionary in the White House that is going to tackle this problem -- the way Lincoln tackled and finally resolved the problem of institutionalized slavery. I would like to see everyone have access to health care. I think it is a human right. I don't think the quality of health care should be the same for everyone. You want to have the best? You have to pay for it. You want to have health care and can't afford the best? We should have a system you can access....even if you have no money. In the long run, we will all be better off.