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Thursday, December 23, 2021

Bad Ways Americans defend their Healthcare System

I've seen many ways Americans defend their healthcare system being both expensive and lousy.

Ironically, despite how loud this contingent is, they are not very representative. In surveys of healthcare satisfaction, Americans are less satisfied with their healthcare system than people in other developed countries.

Furthermore, the high cost of US healthcare hides important variance - due to how insurance works (they get a 'discount' on the list price), even if a procedure costs $100 on average, uninsured people could be billed a crazy price of $2,000, for example. So there're especially big costs on some people, who are disproportionately screwed.

Anyway, here are the arguments that Americans who love their healthcare system use, roughly ranked in order from not very good to awful and atrocious. This ignores people who just deny the data, because really there's no response to those:

1) The US leads the world in medical technology (including drugs) so high healthcare costs are the price they pay and the rest of the world benefits

A third of US healthcare costs are administrative. This is four times more than in comparable countries. This has nothing to do with advanced technology. This is what you'd expect given the number of insurers - logically those could be cut without compromising quality of care.

Drugs are certainly not a major reason for high costs since under 10% of healthcare costs are due to prescription drugs and the US spends 42% more on healthcare than the next contender (and twice the rich country average). In other words, even if the US paid $0 for prescription drugs, it would still spend much more on healthcare than other rich countries.

Anyway, drug prices are high not to cover R&D costs since pharma profits are high, 9/10 large pharma companies apparently spend more on advertising than R&D and ex-pharma execs admits they charge more in the US because they can.

2) The US has better healthcare outcomes

This isn't true. On various healthcare metrics, the US does the same or worse than other developed countries - and this is just looking at quality and ignoring coverage (access).

Defenders of the US healthcare system like to harp on wait times and claim that wait times in the US are very short. In reality, in various European countries, wait times are comparable to those in the US, or even shorter, across 4 metrics: being able to see a doctor or nurse on the same or next day, ease of getting specialized tests, waiting 2 or more months for a specialist and waiting 4 or more months for elective surgery. Note that only the first is about wait times for primary care.

2a) The outcomes in the US only look bad because of guns, automobile accidents, obesity and drugs

When you look at specific healthcare metrics you can see that even with aspects that guns and automobile accidents don't affect, the US does badly on a cost-adjusted basis. For example, the US has higher mortality for respiratory diseases (excluding the covid effect) as well as higher maternal mortality than other wealthy countries. Unless a lot of people are getting lung cancer from breathing in gunpowder residue or car exhaust fumes during car accidents, or people are going around shooting mothers who just gave birth, guns and automobile accidents do not affect these metrics.

In any event, from 2006-2014, guns only cost up to about $2.8 billion a year. Which sounds a lot but is under 0.1% of 2014 healthcare spending. Besides, as gun advocates constantly remind us, if you get rid of guns you don't get rid of the problems guns cause, since people will just kill each other in different ways instead. In other words, countries without guns would have healthcare costs associated with other weapons.

Traffic accidents also can't be as big of a factor as is claimed. In 2010, medical & EMS costs from traffic accidents were estimated at $24 billion vs $2.6 trillion of healthcare costs. So just under 1% of US healthcare spending is due to traffic accidents (and it's not like other countries have no traffic accidents either).

As for obesity, this isn't as big a factor as you might think. In 2008 it was estimated that obesity-related medical costs were $147 billion, which was only 6% of total spending. Furthermore, there're other developed countries with obesity rates that aren't too far behind (e.g. the US has 42.7% of adults with a BMI of 30 or more, vs 31.3% for Australia. Yet they do significantly better than the US. Also there're specific healthcare metrics unrelated to obesity (e.g. medical errors - 19% vs 12% in comparable countries. A 2005 study also found that the US had the highest rate of medical errors compared to Australia, Canada, Germany, New Zealand, and the UK. Presumably unless fat healthcare professionals make more mistakes, this isn't relevant.

As for drug use, it does not make a huge difference. In 2017 the cost of substance use (note: this includes alcohol as well as drugs that can be legal such as opioids and sedatives) in hospitals was estimated at $13.2 billion. This sounds a lot but note that more than half ($7.6 billion) was due to alcohol alone. Furthermore, in 2017 total healthcare spending was $3.5 trillion. So even if you round up, non-alcohol drug use (including legal drugs) cost made up 0.2% of 2017 US healthcare costs

3) Making people pay for their healthcare is good because it encourages personal responsibility. You shouldn't have to pay for other people's healthcare if they don't take care of themselves (e.g. by overeating)

There are some examples in this thread on Occupy Democrats Logic.

This assumes that through personal responsibility, I can prevent ailments like Huntington's Disease, which is congenital, presumably through time travelling to tell my parents not to have me (which, by making sure I never exist, effectively zero-ises my healthcare costs). Or that if I'm crossing the road and a car comes out of nowhere and hits me, it's my fault for not having the eyes of a hawk.

There're also striking parallels with the police - one could say that abolishing the police would be good because it encourages personal responsibility. You shouldn't have to pay to keep safe people who choose to live in bad neighbourhoods, or hang out with gangstas, and buying a gun means I can keep myself safe (we are told, contrary to evidence that it makes you less safe). Objections to this claim about the police, then, would equally apply to the same claim for healthcare.

In any event, personal responsibility can be built into government subsidised healthcare through copayment. For example in France there is copayment per night for hospital stays and in Switzerland there's deductibles for health claims. And of course, private healthcare (i.e. the US system) is not immune to moral hazard - if you know your insurer will pay for everything you can feel free to get as many treatments as you want.

This emphasis on "personal responsibility" might ironically drive healthcare costs even higher: the US has a high rate of hospitalizations for diabetes and hypertension, which are considered preventable with better access to primary care. In other words, if it were cheaper (or free) to visit the doctor, Americans might get help sooner and avoid a more expensive hospital visit later.

4) The US has a big, heterogenous population so what works elsewhere would never work there

We are always told that the US has a big population. Yet, it's not clear why that would be a factor. Indeed, economies of scale would be expected to drive costs down (e.g. a larger country would have more negotiating power with drug companies to lower prices).

What is the magic population number beyond which universal healthcare would never work? This is never defined. For example, Japan has over 125 million people. Apparently what would work in a country with 125 million people would never work in a country with 329 million. This is very convenient.

The homogeneity point might be vaguely relevant with regard to social solidarity and public financing, but even other developed countries with non-homogenous populations manage to make affordable healthcare work. For example Australia has a 24% non-white population and Canada has a 22.3% "visible minority" population. The US is similar, with a 23.7% non-white population.

5) Europeans can afford to spend more on healthcare because the US takes care of their defence

While it is true that the US does take care of their defence, this is an absolute red herring, given that the US also spends significantly more on healthcare than European countries both on a PPP basis and as a percentage of GDP.

In other words, it's not that the Europeans can afford to spend more on healthcare because the US takes care of their defence, since the Europeans also spend less on healthcare than the US.

6) Socialised healthcare performs worse than private

This is an ideological position that has nothing to do with empirical facts about how healthcare in the US actually performs, whether on a cost-adjusted basis or just on outcomes. Above I have provided evidence that US healthcare performs worse than that of other developed countries - even before adjusting for cost.

Anyhow, multiple reports pinpoint access as a factor in evaluating healthcare systems. There is no reason why access should not be an issue: healthcare is about keeping the population healthy, so if you can't access a healthcare system, it's useless. Excellent healthcare you can't use is worse than mediocre healthcare you can, after all.

Ironically these people are usually the same people who talk about economics teaching us about scarcity, and how you need rationing under socialism, as if prices so high the product is inaccessible to almost everyone isn't a form of rationing. Even if we ignore that, they are unable to understand that money is a scarce resource, so cost effectiveness is a very relevant metric in evaluating a healthcare system (apparently their Economics 101 course didn't teach them about scarcity).

This also focuses on the experience of the richest. They say that many people go to the US for treatment, so this proves that the US system is better. For example, Mick Jagger went to the US for treatment instead of staying in the UK. Gandhi said “The true measure of any society can be found in how it treats its most vulnerable members.” It seems those who think US healthcare is the best option out there think “The true measure of any healthcare system can be found in how it treats its richest patients".

So one might posit that American healthcare is good - if you're filthy rich (even if there doesn't seem to be data about this - perhaps people go to the US for experimental treatments which might not even work).

Besides which, if the US healthcare system were really the best in the world, why do so many Americans go abroad for medical care? In 2017 more than 1.4 million Americans went abroad for medical treatment. I couldn't find contemporaneous figures for inbound medical tourism for the US but in 2012, 800,000 foreigners went to the US for medical care, which suggests that the "superior" US healthcare system drives away more people than it attracts.

But even if you ignore cost and access and look at quality of care alone, the US health system is far from the best in the world.

75% of employed Americans say the healthcare they receive is "excellent" or "good". But in Australia, the Netherlands, Great Britain, Saudi Arabia and Canada, which all provide universal coverage (i.e. "socialism", even if not all have a single payer system), 72-81% of respondents rate the quality of healthcare that they have access to as very good or good. 

One cope I've seen is that "Americans are stupid & don’t realize how good they have it". Of course, this same person claimed that he's never had "a British,American,French,Canadian etc. prefer the socialized quality of care" so basically anecdotes that support his claims are good but data that refute them are bad (he went on to claim that he was giving "facts").

7) It's only expensive and lousy because of government intervention 

For example, this is said by people on Being Classically Liberal or in this awful Intellectual Takeout article which shows rising costs and then claims that these are all due to regulation, but many of the claims don't make sense or contradict how defenders of the US's healthcare system promote it. Just because there was regulation and healthcare costs rose doesn't mean the former caused the latter. That's the post-hoc, ergo propter-hoc fallacy.

It's strange how countries with more government intervention provide outcomes that are often better and definitely cheaper.

8) With socialised healthcare, nothing is free - taxpayers pay for it

This is just semantics.

No one who says healthcare should be free thinks that the cost of providing it is really zero. They are saying that it should be free at the point of service (not to mention that universal coverage isn't the same thing as single payer).

They crow about making what they think is a very clever point when it's really just puerile wordplay.

Presumably, these people don't mock businesses with "buy one get one free" promotions, or the idea of "free" public libraries, or that you don't need to pay to call the police or access many other public services.

9) The US only spends a lot of money because it has a large population

This is an inability to understand per capita, or expenditure as a percentage of GDP.

The US doesn't just spend a lot in total, as it would because it has a huge population as "Health spending per person in the U.S. was $10,966 in 2019, which was 42% higher than Switzerland, the country with the next highest per capita health spending... On average, other wealthy countries spend about half as much per person on health than the U.S."

10) Socialised healthcare is slavery

We are told that if tax dollars pay for healthcare, you are extorting people to pay for it (aka taxes). Extortion/slavery are bad. Presumably all public services are slavery, then. Though of course, these "libertarians" (i.e. anarchists) also claim that taxation is theft and mock "statists" who think that governments are needed to build roads.

Even more ludicrously, some claim that free (at point of use) healthcare is slavery because you're forcing medical staff to work for free. Yes, these people exist Here is a motherlode of such morons.

Somehow it doesn't occur to them that policemen, judges and public school teachers are all slaves who are forced to work for no income either. Or how it's downright bizarre that in the rest of the developed world, there're huge numbers of medical professionals in slavery, forced to work for free.

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