Tag Archives: Duty to Die

Thomas Sowell explains the economics of cutting health care costs

The Democrats are talking a lot of about their plan to reduce the costs of health care. And they think that the way to do that is by having government take a bigger role in health care provision. Well, Thomas Sowell doesn’t like the idea that the government can reduce health care costs by using govenrment, and he’s written a four part series on it.

Here’s a quote from the first part about how Democrats attack the suppliers of health care products and services:

Despite all the demonizing of insurance companies, pharmaceutical companies or doctors for what they charge, the fundamental costs of goods and services are the costs of producing them.

If highly paid chief executives of insurance companies or pharmaceutical companies agreed to work free of charge, it would make very little difference in the cost of insurance or medications. If doctors’ incomes were cut in half, that would not lower the cost of producing doctors through years of expensive training in medical schools and hospitals, nor the overhead costs of running doctors’ offices.

What it would do is reduce the number of very able people who are willing to take on the high costs of a medical education when the return on that investment is greatly reduced and the aggravations of dealing with government bureaucrats are added to the burdens of the work.

Britain has had a government-run medical system for more than half a century and it has to import doctors, including some from Third World countries where the medical training may not be the best.

And a quote from the second part about how reducing costs means rationing:

There is no question that you can reduce the payments for medical care by having either a lower quantity or a lower quality of medical care. That has already been done in countries with government-run medical systems.

In the United States, the government has already reduced payments for patients on Medicare and Medicaid, with the result that some doctors no longer accept new patients with Medicare or Medicaid. That has not reduced the cost of medical care. It has reduced the availability of medical care, just as buying a pint of milk reduces the payment below what a quart of milk would cost.

Letting old people die instead of saving their lives will undoubtedly reduce medical payments considerably. But old people have that option already— and seldom choose to exercise it, despite clever people who talk about a “duty to die.”

A government-run system will take that decision out of the hands of the elderly or their families, and thereby “bring down the cost of medical care.” A stranger’s death is much easier to take, especially if you are a bureaucrat making that decision in Washington.

[…]You can even save money by cutting down on medications to relieve pain, as is already being done in Britain’s government-run medical system.

You can save money by not having as many high-tech medical devices like CAT scans or MRIs, and not using the latest medications. Countries with government-run medical systems have less of all these things than the United States has.But reducing these things is not “bringing down the cost of medical care.” It is simply refusing to pay those costs— and taking the consequences.

And a quote from the third part talks about free markets versus government price controls:

If you think the government can lower medical costs by eliminating “waste, fraud and abuse,” as some Washington politicians claim, the logical question is: Why haven’t they done that already?

Over the years, scandal after scandal has shown waste, fraud and abuse to be rampant in Medicare and Medicaid. Why would anyone imagine that a new government medical program will do what existing government medical programs have clearly failed to do?

If we cannot afford to pay for doctors, hospitals and pharmaceutical drugs now, how can we afford to pay for doctors, hospitals and pharmaceutical drugs, in addition to a new federal bureaucracy to administer a government-run medical system?

And a quote from the fourth part talks about equality versus liberty in health care:

What about insurance companies denying reimbursements for treatments? Does anyone imagine that a government bureaucracy will not do that?

Moreover, the worst that an insurance company can do is refuse to pay for medication or treatment. In some countries with government-run medical systems, the government can prevent you from spending your own money to get the medication or treatment that their bureaucracy has denied you. Your choice is to leave the country or smuggle in what you need.

However appalling such a situation may be, it is perfectly consistent with elites wanting to control your life. As far as those elites are concerned, it would not be “social justice” to allow some people to get medical care that others are denied, just because some people “happen to have money.”

But very few people just “happen to have money.” Most people have earned money by producing something that other people wanted. But getting what you want by what you have earned, rather than by what elites will deign to allow you to have, is completely incompatible with the vision of an elite-controlled world, which they call “social justice” or other politically attractive phrases.

What’s frustrating to me is how quickly people think of growing government as the solution to their problems. They don’t want to deal with paying for health care themselves. But what the government does to solve the high prices is fix prices and regulate the producers of health care, like doctors and medical device manufacturers. They make the supply smaller. But when the cost apparently goes down, people are signaled to use more health care. That makes the demand larger. And this is why there is a shortage of health care in countries that have health care provisioning highly regulated by the government.

You can even save money by cutting down on medications to relieve pain, as is already being done in Britain’s government-run medical system.

You can save money by not having as many high-tech medical devices like CAT scans or MRIs, and not using the latest medications. Countries with government-run medical systems have less of all these things than the United States has.But reducing these things is not “bringing down the cost of medical care.” It is simply refusing to pay those costs— and taking the consequences.