Sunday, August 27, 2006

Healthcare.

The promised healthcare post.

There's a ridiculous amount of newsprint been consumed recently regarding the election by the CMA (Canadian Medical Association) of a president who owns a private clinic, in contravention of the Canada Health Act, in Vancouver, BC. Samples: here, here, here, and here. There's also been a fair amount of comment, from both the left and the right.

Here's the gist of what I have to say: everyone's wrong. No, seriously, everyone. The CMA will fall apart before the public system. And, two-tier healthcare is not fair.

Dealing with the first. No one seems to understand that these sorts of professional organizations aren't monolithic and uniform entities. They're cobbled together groupings of smaller, more cohesive groups, that will hold together only so long as the interests served by the larger group are not undermining the interests of the smaller groups. (For example, as we see here, the Professional Associations of Interns and Residents of Ontario (PAIRO) -- future physicians -- is clearly against private healthcare.) Unfortunately, I don't see any information on the demographics of the election, so this is going to get a little speculative. There's usually a split in physicians' groups, in my experience, between the hospital physicians and physicians in private practice. The former, oddly enough, tend to be more money-obsessed than the latter. My explanation for this is that the latter have to see more patients. Physicians who work in hospitals can be more selective in who they see, and usually make their decisions on the basis of who they can bill the most for. By contrast, physicians in private practice will, on the whole, get a better sense of the needs of the general patient population, because they have to see a large number of patients in order to make their overhead. Physicians in private practice will usually favour public healthcare for just that reason -- they know what the general patient population needs, and they know that private insurance would tend to exclude a significant portion of that population. (More on that later.)

I'd also suggest that there may be a split between older and younger physicians. The Canada Health Act was only adopted in 1984. An individual born in 1984 is currently younger than I am -- about 22 years old -- and thus probably not a physician. Which means that most physicians will have grown up in a Canada that did not have public healthcare. To what extent, I wonder, do older physicians tend to favour private healthcare, because it's what they grew up with? Possibly confounding this is the fact that there are foreign-trained and -born physicians practicing in Canada who may have grown up under public systems. Not to mention that, sometimes, people will hate what they are familiar with, rather than being drawn to it. On the whole, though, I would suspect that there is a certain amount of yearning for the "good ol' days" going on.

Furthermore, the formation of Canadian Doctors for Medicare suggests that there are significant numbers of physicians who want an organization that will openly endorse public healthcare. So, far from tolling the end of public healthcare, I'd think that the CMA president endorsing private healthcare would signal the end of the CMA as an organization that represents all Canadian physicians -- if their new president actually uses his position to endorse private healthcare.

And that is a very salient point that, so far, has been completely overlooked. Just because the elected president believes in private healthcare doesn't mean that he's going to use his position to espouse it. Particularly if I'm right on the first point, and there are sufficient splits within the CMA that the organization itself might splinter over the issue of privatizing healthcare.

So, on the whole, there's some important issues that we simply don't know enough about, at this point, to go off half-cocked proclaiming the end of public healthcare -- either as a good thing or a bad thing.

But, that aside, let's consider the issue of public vs. private healthcare. There are really three possible systems: public alone, private alone, and a combination of public and private. Private alone I will reject out of hand. I don't know anyone sane who suggests that there should be entirely private healthcare, leaving even the very poorest and neediest without public support for their medical bills. That leaves either a purely public system or a two-tier system.

There's a couple of defenses of two-tier systems that get trotted out, and they don't really work. The first is that the injection of private money might alleviate the problems facing the public system. This is false. The public system lacks money, that much is true. However, the public system also lacks other resources, particularly healthcare providers. A two-tier system will take healthcare providers out of the public system and put them in the private system. This is a basic logical point -- there's a limited supply of providers, so anyone practicing in one system is therefore not able to practice in the other (at least while they're practicing in the one). Private money might be able to help create more resources; but, then again, public money could do so just as easily. In this respect, publicly- and privately-funded healthcare are on all fours with each other; so, it's no mark in favour of a two-tier system that private money could solve this problem.

(Aside: some practitioners in the public system do not practice year-round, because they hit their provincially-mandated billing caps. That is, there is a limit on how much any physician can bill during a calendar year, and some physicians do hit it. They are thus left with the choice of either not practicing or practicing for free, as they are not legally entitled to charge for covered services. Does two-tier healthcare have a lever here? Simply, no: any physician whose services are genuinely in demand can apply to the provincial government to have the cap removed, thus allowing for unlimited billing. Physicians can also perform non-insured services, such as medico-legal examinations for private auto insurance (in provinces that have them) or worker's compensation systems, for which they can thus bill privately. Therefore, most physicians who do not practice the full year seem to be doing so out of choice, not out of need.)

The second argument that often gets trotted out is that people have a "right" to pay for healthcare if they are able. However, it is, first, utterly bizarre to claim that there is a "right" to buy what one is able to buy. I'm sure there are sufficiently poor people who would sell themselves into slavery to sufficiently rich people, but nonetheless it is obviously wrong to buy a slave. So, really, the "right" being invoked is, as with most rights, a limited one: one can buy whatever there is no good reason to prevent one from buying. In the case of slavery, the autonomy of the individual is sufficiently valuable that it cannot be violated, even if an individual would voluntarily choose to give up his autonomy. That's at least a reason not to allow buying slaves. Similarly, there is a reason not to allow people to buy private healthcare: the competition is necessarily unequal, and thus unfair. The inequality comes from two sources. First, the problem of the uninsurable. As anyone who's tried to buy, say, private auto insurance with a bad driving record can tell you, insurers are risk-averse. That is, they don't like to take on clients that they believe will make large claims and cost them lots of money. This extends to health, as well. Insurers will charge higher premiums to people with expensive chronic conditions (such as AIDS) or with a high likelihood of sustaining serious acute injury (such as the severely mentally ill). In many cases, insurers will either price their premiums sufficiently high to in effect render people uninsurable, or will simply refuse to insure them outright. How can the competition for private insurance be fair if some people are blocked from entering the market? Second, the middle class will continually lose out on access to treatment. The lower classes will be treated publicly, on the basis of need. The upper classes will have quick access to the private system. How can the middle class compete with the lower classes on the basis of need -- particularly if they pass whatever threshold of income is necessary to be excluded from the public system. Similarly, how can the middle class compete with the upper class for access on the basis of income? Thus, when it comes to either the public or the private system, the middle class will tend to be systematically discriminated against. How can this be fair?

So, for all its (reparable) flaws, the public system is still better than a two-tier public/private one.

8 comments:

undergroundman said...

"However, it is, first, utterly bizarre to claim that there is a "right" to buy what one is able to buy."

However, that is the foundation of the free market. For what rational reason would a person sell himself into slavery . Is it obviously wrong to buy a slave? What if that slave dearly wants to sell himself to feed his family, and knows that he can earn the money no other way? He enters into the transaction willingly - is it really wrong? Similarly, is it really wrong to sell a kidney? (A controversial issue today - people like you say it is, people like me say it is and point to the fact that most all transactions in a free market are mutually beneficial.) In a world of limited resources, people do not have a "right" to eat. If there is enough food to feed them, then, yes, it may be immoral for them to be have no food - but the foundation of our system is that you earn the right to eat and consume products - simply because it is a world of limited resources. You create value, sell it, and thus are able to purchase value.

"In the case of slavery, the autonomy of the individual is sufficiently valuable that it cannot be violated, even if an individual would voluntarily choose to give up his autonomy."

You judge that - based on what? Your ideas of justice, not the person you're protecting. The person you're protecting may (most likely will) resent you for it. What right do you have to judge for him?

I personally believe in HSAs (health savings accounts) rather than insurance. Insurance has too many bad incentives. I'd rather give money to the poor for healthcare rather than giving them free healthcare. Then they can decide where they want to place that "healthcare" money, or whether they want to save it up for something truly necessarily.

ADHR said...

"However, it is, first, utterly bizarre to claim that there is a "right" to buy what one is able to buy."

However, that is the foundation of the free market.


Not true. The foundation of the free market system is that if we allow everyone to sell their labour and the products of their labour to anyone who is willing to buy them, then there will be greater overall social benefit than if these transactions were centrally managed. It's not the rule of the buyers, it's the rule of the producers and the sellers. Buyers enter the picture derivatively, as those who pick up what they need in order to continue to produce whatever it is they are producing in the system.

For what rational reason would a person sell himself into slavery . Is it obviously wrong to buy a slave? What if that slave dearly wants to sell himself to feed his family, and knows that he can earn the money no other way? He enters into the transaction willingly - is it really wrong?

Of course it is. I'm not sure what point you're trying to make here.

Similarly, is it really wrong to sell a kidney? (A controversial issue today - people like you say it is, people like me say it is and point to the fact that most all transactions in a free market are mutually beneficial.)

As long as it's not an exploitive transaction, I don't see why you can't sell a kidney. I'm not sure who should be allowed to buy them, though. There's a real problem with the rich, but not terribly sick, leap-frogging the deathly ill and buying up all the loose organs.

In a world of limited resources, people do not have a "right" to eat. If there is enough food to feed them, then, yes, it may be immoral for them to be have no food - but the foundation of our system is that you earn the right to eat and consume products - simply because it is a world of limited resources.

This is not strictly true. Resources are limited, yes, but resources are not so limited that not everyone can have enough to eat. There's a lot of wasted food and misused land in play here. The logic behind "earning" a "right" to eat is really based on the idea that anyone who cannot earn enough to eat somehow deserves to not have enough to eat. But this assumes that every individual person has sufficient resources to begin with such that they, in principle, could earn enough to eat. This is, however, not true. In many parts of the world, people start at such a severe deficit that they could never earn enough to eat before their need to eat overwhelmed their abilities to produce.

Ultimately, the point is that the current state of the world did not come about through fair and equal transactions. Thus it is incumbent on those of us who are heirs of the tremendous wrongs that have been done to try to make them right, and not only level the playing field for everyone, but also recompense those who do not have the resources necessary to compete even on a level ground. If that were the actual state of the world, then the idea that people should earn a right to eat might have some moral traction; as is, however, it's rather grotesque.

You create value, sell it, and thus are able to purchase value.

In an ideal Lockean state of nature, yes (granting also Locke's ideas about the fair acquisition and disposal of property, etc.). But many resources, as said, have been acquired by the West through gross wrongdoing. The same also applies, on a smaller scale, within Western countries: the rich did not, as a class, become the rich through fair and equitable competition. When the system is broken, it needs to be corrected before we condemn those who do not win according to the rules of the system at its ideal.

"In the case of slavery, the autonomy of the individual is sufficiently valuable that it cannot be violated, even if an individual would voluntarily choose to give up his autonomy."

You judge that - based on what? Your ideas of justice, not the person you're protecting. The person you're protecting may (most likely will) resent you for it. What right do you have to judge for him?


What right do you have to say I shouldn't judge for him? This is a really poor argument. You assume, without argument, two claims (at least) which I am implicitly denying. First, that an individual's own immediate judgements of right and wrong, good and evil, trump any others. Second, that his considered judgement would not agree with mine; that is, you are comparing a considered judgement (mine) to an immediate, preferential judgement (his). Since the comparison is between disparate judgements, it would be a small miracle if they were the same.

I personally believe in HSAs (health savings accounts) rather than insurance. Insurance has too many bad incentives. I'd rather give money to the poor for healthcare rather than giving them free healthcare. Then they can decide where they want to place that "healthcare" money, or whether they want to save it up for something truly necessarily.

The issue isn't that "the poor" get "free" healthcare. The issue is that healthcare is a general social good, like roads and clean air. So, society as a whole agrees to fund it at a certain level, for all to have equal access to it. It's not even really an insurance scheme. Savings accounts are a poor concept as they rely on taking an average person, and leaving the outliers to either suffer (due to vastly exceeding their saved amounts) or prosper unjustly (due to luckily not needing to spend healthcare money).

undergroundman said...

Not true. The foundation of the free market system is that if we allow everyone to sell their labour and the products of their labour to anyone who is willing to buy them, then there will be greater overall social benefit than if these transactions were centrally managed.

That's an argument for the free market over centrally planned systems. The free market is people willingly entering into mutually beneficial transactions with each other. (At least this is the impression I got from my neoclassical economics classes.) That's part of why it's so effective. But you're right -- that doesn't mean there's a "right." I was fairly drunk when I posted that comment. On the "foundation of the neoclassical economics", it seems like the answer would differ based on who you talked to -- essentially a subjective and semantic point.

What right do you have to say I shouldn't judge for him? This is a really poor argument. You assume, without argument, two claims (at least) which I am implicitly denying. First, that an individual's own immediate judgements of right and wrong, good and evil, trump any others.

When it concerns his own body and doesn't effect anyone else, yes. Why is that wrong? You have no right to ascribe your value judgments on other people and thus dictate their personal decisions.

Second, that his considered judgement would not agree with mine; that is, you are comparing a considered judgement (mine) to an immediate, preferential judgement (his). Since the comparison is between disparate judgements, it would be a small miracle if they were the same.

Let's say, for the sake of argument, someone does wish to sell himself into slavery. Perhaps he would even prefer to be enslaved. Perhaps he's sexually submissive and wants to make the experience as real as possible. I don't see why the person purchasing him is committing a wrong. It's similar to euthanasia: if you help someone die, who wishes to die, are you committing a heinous act? All I'm saying is that the act of buying a slave from himself is not necessarily a heinous act. It's simply a contract between two people (a fairly unbalanced one). It's what comes afterwards that may be heinous.

Savings accounts are a poor concept as they rely on taking an average person, and leaving the outliers to either suffer (due to vastly exceeding their saved amounts) or prosper unjustly (due to luckily not needing to spend healthcare money).

You forget that HSAs are coupled with high-deductible insurance premiums -- do you have a backup argument?

ADHR said...

That's an argument for the free market over centrally planned systems. The free market is people willingly entering into mutually beneficial transactions with each other. (At least this is the impression I got from my neoclassical economics classes.) That's part of why it's so effective.

Mebbe. I'd tend to think, though, that my gloss on it is more accurate. If there aren't any sellers (producers), then the system can't even get started, even if there are millions of buyers around.

But you're right -- that doesn't mean there's a "right." I was fairly drunk when I posted that comment. On the "foundation of the neoclassical economics", it seems like the answer would differ based on who you talked to -- essentially a subjective and semantic point.

If we want to derive rights from it, though, then what the foundation is really matters!

You spell remarkably well when you're drunk. I couldn't even tell.

When it concerns his own body and doesn't effect anyone else, yes. Why is that wrong? You have no right to ascribe your value judgments on other people and thus dictate their personal decisions.

Ah, I see. You're conflating two different issues. First is whether I can judge someone else. Second is whether I should force compliance with my judgement. I'm only asserting the former. I can judge others, even if it regards a matter that entirely affects a single person. If I couldn't, then it's not entirely clear why I can judge myself in matters that only affect me. (What, morally speaking, is the difference between me and someone else?)

With regards to the second issue, then we get back to the point about paternalism. I can only force compliance on someone else if the other person is not competent to make their own judgements (e.g., they are a child) or to prevent significant harm (e.g., they have fissile material). In all other cases, I pretty much have to stop with remonstration and bribery -- anything more than that requires that I am doing somehing wrong by violating their autonomy.

Let's say, for the sake of argument, someone does wish to sell himself into slavery. Perhaps he would even prefer to be enslaved. Perhaps he's sexually submissive and wants to make the experience as real as possible. I don't see why the person purchasing him is committing a wrong. It's similar to euthanasia: if you help someone die, who wishes to die, are you committing a heinous act? All I'm saying is that the act of buying a slave from himself is not necessarily a heinous act. It's simply a contract between two people (a fairly unbalanced one). It's what comes afterwards that may be heinous.

I think the value of autonomy is sufficient that no other benefit will swamp it. Hence, the contracted benefit is not enough to justify giving up autonomy.

Which is, again, a different issue from whether we should stop anyone from giving it up. That, I think, can be justified on the not unreasonable basis that in most cases, giving oneself up into slavery has resulted in harm.

FYI, euthanasia and assisted suicide are different issues, morally, as the former I can do to myself, while the latter requires another party. It's possible that I am morally permittted to give myself a lethal dose of medication, even though no one else would be permitted to do so.

You forget that HSAs are coupled with high-deductible insurance premiums -- do you have a backup argument?

You've lost me. How do high-deductible insurance premiums help? Can I use the savings to pay the deductible? If that is the case, then I'm not sure what the benefit to this system is as compared to a low- or no-deductible insurance scheme. It looks like an incentive is created to downplay one's health issues in favour of other goals (e.g., buying a shiny new car). Since health is a great (but not overwhelming) good, creating that incentive looks like a bad thing.

undergroundman said...

How do high-deductible insurance premiums help? Can I use the savings to pay the deductible?

Yes.

If that is the case, then I'm not sure what the benefit to this system is as compared to a low- or no-deductible insurance scheme.

The benefit is twofold. One is that the HSA money can be spent on supplements, alternative healthcare, cosmetic dentistry, and other things. They don't need the approval of their doctor or their insurance provider to get healthcare paid for, either. These purchases don't count towards your deductible. Hospital visits do. The benefit when it comes to mainstream healthcare is that consumers have a direct relationship with their doctor, paying for the services rendered. The doctors and the consumer both become aware of the costs of procedures and do their best to minimize excess costs. Consumers also have more of an incentive to stay healthy.

Now, you might point out the potential problem -- consumers might not choose to pay for expensive procedures and may end paying the price for it later. Which could be a problem -- some free preventative coverage would be nice.

My dad's got an HSA and I like it, although it is pretty weak. His company deposits 250 bucks a month into the account. The deductible is pretty high, though -- 8 grand. Probably sounds very harsh to you. ;)

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ADHR said...

The benefit is twofold. One is that the HSA money can be spent on supplements, alternative healthcare, cosmetic dentistry, and other things. They don't need the approval of their doctor or their insurance provider to get healthcare paid for, either. These purchases don't count towards your deductible. Hospital visits do.

Non-essential "healthcare" isn't really an issue I worry about. I mean, if it's not necessary, then it really should be up to the market to generate any mechanisms it chooses for best serving the needs of consumers.

The benefit when it comes to mainstream healthcare is that consumers have a direct relationship with their doctor, paying for the services rendered. The doctors and the consumer both become aware of the costs of procedures and do their best to minimize excess costs. Consumers also have more of an incentive to stay healthy.

If we tie the healthcare costs to taxes, though, then doesn't that also provide the incentive? As far as relationship with physicians goes, that's already present in the public insurance system. Physicians and hospitals are private corporations which bill the relevant province; patients choose their own physicians, in accordance with the (sometimes byzantine) network of referrals.

Now, you might point out the potential problem -- consumers might not choose to pay for expensive procedures and may end paying the price for it later. Which could be a problem -- some free preventative coverage would be nice.

Not to mention that there still seems to be a hole in the HSA system, whereby if not enough money has been saved by the time any given procedure is needed, the patient either pays out of pocket or goes without.

My dad's got an HSA and I like it, although it is pretty weak. His company deposits 250 bucks a month into the account. The deductible is pretty high, though -- 8 grand. Probably sounds very harsh to you. ;)

8 grand is more than the deductible on my car insurance! That seems a little out of whack to me.

ADHR said...

Zenseeker: The internet is an oddly tangled place. Thanks for the link!