Interesting, thought provoking article.... On Tue, Jul 18, 2017 at 5:35 PM, MJ <[email protected]> wrote:
> > March 18, 2017 > > *Why Single-Payer Health Care Delivers Poor Quality at High Cost *Daniel > J. Mitchell > > I shared last year a matrix to illustrate Milton Friedman’s great insight > <https://danieljmitchell.wordpress.com/2016/05/08/milton-friedman-adam-smith-and-other-peoples-money/> > about the superior results achieved by markets compared to government. > > [image: []] > > Incentives explain why markets work best. When you spend your own money on > yourself (box 1), you try to maximize quality while minimizing cost. And > that drives the businesses that are competing for your money to constantly > seek more efficient ways of producing better products at better prices. > > This system generates creative destruction > <https://danieljmitchell.wordpress.com/2016/12/20/creative-destruction-job-losses-technological-change-and-human-progress/>, > which sometimes can be painful, but the long-term result > <https://danieljmitchell.wordpress.com/2014/06/27/the-amazing-hockey-stick-of-economic-progress/> > is that we are vastly richer > <https://danieljmitchell.wordpress.com/2014/06/17/the-miracle-of-modern-day-prosperity-and-the-ideas-and-policies-that-made-it-happen/> > . > > Governments, by contrast, don’t worry about efficiency or cost (box 4). > > Today, though, let’s use Friedman’s matrix to understand the shortcomings > of the US health care system. Way back in 2009, I opined that the most > important chart in health care > <https://danieljmitchell.wordpress.com/2009/12/28/the-real-healthcare-chart-of-the-day/> > was the one showing that American consumers directly paid for less than 12 > percent of health expenditures. > > [image: []] > > For all intents and purposes, instead of buying health care with their own > money, they use other people’s money (box 2), a phenomenon known as > third-party payer. And because most of their health expenses are financed > by either government (thanks to Medicare > <https://danieljmitchell.wordpress.com/2011/05/17/whos-right-on-medicare-reform-ryan-and-rivlin-or-obama-and-gingrich/>, > Medicaid > <https://danieljmitchell.wordpress.com/2011/06/27/block-granting-medicaid-is-a-long-overdue-way-of-restoring-federalism-and-promoting-good-fiscal-policy/>, > Obamacare > <https://danieljmitchell.wordpress.com/2009/11/10/obamacare-will-be-a-budget-buster/>, > etc) or insurance companies (thanks to the tax code’s health care > exclusion > <https://danieljmitchell.wordpress.com/2016/04/29/the-healthcare-exclusion-is-the-tax-codes-most-harmful-loophole/>), > consumers focus only on quality and don’t care much about cost. > > That 2009 column was written before Obamacare’s enactment, so let’s see if > anything has changed. > > [image: []] > > Well, we know health care has become more expensive > <https://danieljmitchell.wordpress.com/2016/08/29/another-grim-reminder-that-obamacare-has-made-healthcare-more-expensive/>. > But do we know why? > > The answer, at least in part, is that consumers are directly financing an > even smaller percentage of their health care expenses. In other words, the > distortions caused by third-party payer have become worse. > > Here’s the most-recent data from the federal government’s Centers for > Medicare and Medicaid Services > <https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html> > (specifically the National Health Expenditures by type of service and > source of funds, CY 1960-2015 > <https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/NHE2015.zip>). > Consumers are now paying only 10.5 percent of health care costs. > > [image: []] > > Now let’s consider the issue of efficiency. > > Are we getting better health care for all the money that’s being spent? > > That doesn’t seem to be the case. Here’s another chart from the archives > <https://danieljmitchell.wordpress.com/2009/12/28/the-real-healthcare-chart-of-the-day/>. > It compares per-capita health spending in various nations with average life > expectancy. > > [image: []] > > As you can see, the United States is not getting more bang for the buck. > And I very much doubt an updated version of those numbers would show > anything different. > > Heck, we even have more government spending on health care > <https://danieljmitchell.wordpress.com/2013/02/23/which-nation-has-the-most-per-capita-government-spending-on-healthcare-france-italy-the-united-states-sweden-canada-greece-or-the-united-kingdom/>, > per capita, than many nations with fully nationalized systems. > > So if we’re not buying better health outcomes with all this money, what > are we getting? > > The blunt answer is bureaucracy and inefficiency. Here are some excerpts I > shared years ago > <https://danieljmitchell.wordpress.com/2011/06/07/if-we-want-to-fix-the-healthcare-mess-we-better-understand-the-real-problem/> > from a column by Robert Samuelson. > > There are 9 times more clerical workers in health care than there are > physicians, and twice as many clerical workers as registered nurses. This > investment has not paid off in superior outcomes or better customer > service, however. …Every analysis of medical care that has been done > highlights the significant waste of resources in providing care. Consider a > few examples: one study found that physicians spent on average of 142 hours > annually interacting with health plans, at an estimated cost to practices > of $68,274 per physician (Casalino et al., 2009). Another study found that > 35 percent of nurses’ time in medical/surgical units of hospitals was spent > on documentation (Hendrich et al., 2008). > > Let’s close with a chart from a left-wing group that wants a single-payer > system. > > And this chart clearly makes a compelling case that the current approach > in the United States is very wasteful. > > [image: []] > > For what it’s worth, I’m slightly skeptical about the veracity of the > numbers. Why, for instance, would there be a sudden explosion of > administrators starting about 1990? > > But even if the data is overstated, I’m sure the numbers are still bad. We > see the same thing in other areas of our economy > <https://danieljmitchell.wordpress.com/2014/09/18/subsidies-and-third-party-payer-inefficiency-and-higher-prices/> > where government-instigated third-party payer enables waste and > featherbedding. Higher education is an especially shocking example > <https://danieljmitchell.wordpress.com/2015/12/23/government-subsidies-are-causing-higher-tuition-and-administrative-bloat-in-higher-education/> > . > > The real issue is how to solve the problem. Our leftist friends think a > single-payer health care system would solve the problem, but that would be > akin to nationalizing grocery stores to deal with the inefficiencies > created by food stamps > <https://danieljmitchell.wordpress.com/2016/12/18/end-food-stamps-as-part-of-a-federalist-agenda-to-decentralize-redistribution-programs/> > and agriculture subsidies > <https://danieljmitchell.wordpress.com/2016/12/14/the-insane-world-of-agriculture-subsidies/> > . > > The real answer, as Julie Borowski explains in this video > <https://danieljmitchell.wordpress.com/2015/01/13/our-healthcare-policy-problem-is-much-bigger-than-obamacare/>, > is unraveling all the government interventions that caused the problem in > the first place. > > > > > *https://youtu.be/Pl3LwMGFAFM <https://youtu.be/Pl3LwMGFAFM> *And if you > want another video on the topic, here’s a Dutch expert making similar > points > <https://danieljmitchell.wordpress.com/2009/11/03/dont-copy-europes-mistakes/>. > I also recommend this clever cartoon video > <https://danieljmitchell.wordpress.com/2014/03/05/funny-cartoon-video-mocks-obamacare/> > that explains third-party payer. And this Reason video > <https://danieljmitchell.wordpress.com/2012/11/17/must-watch-video-from-reason-tv-on-how-free-markets-not-obamacare-can-solve-the-healthcare-mess/> > on how costs are lower when actual markets operate. > > And if aren’t already numbed by lots of data, Mark Perry > <https://danieljmitchell.wordpress.com/2015/04/09/the-free-market-works-in-health-care-when-its-allowed/> > and Devon Herrick > <https://danieljmitchell.wordpress.com/2010/12/08/everything-you-need-to-know-about-healthcare-economics-in-one-chart/> > have more evidence of lower costs when third-party payer is reduced. > > > > > *Republished from International Liberty > <https://danieljmitchell.wordpress.com/2017/03/13/the-worlds-most-inefficient-healthcare-system-part-i-created-by-government-financed-by-government/>. > * https://fee.org/articles/why-single-payer-health-care- > delivers-poor-quality-at-high-cost/ > > -- > -- > Thanks for being part of "PoliticalForum" at Google Groups. > For options & help see http://groups.google.com/group/PoliticalForum > > * Visit our other community at http://www.PoliticalForum.com/ > * It's active and moderated. Register and vote in our polls. > * Read the latest breaking news, and more. > --- > You received this message because you are subscribed to the Google Groups > "PoliticalForum" group. > To unsubscribe from this group and stop receiving emails from it, send an > email to [email protected]. > For more options, visit https://groups.google.com/d/optout. > -- -- Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum * Visit our other community at http://www.PoliticalForum.com/ * It's active and moderated. Register and vote in our polls. * Read the latest breaking news, and more. --- You received this message because you are subscribed to the Google Groups "PoliticalForum" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. For more options, visit https://groups.google.com/d/optout.
