Economists on Health Care

The latest issue of The Economists’ Voice is a special issue on health care reform. David Cutler explains the economics of health reform, while Mark Duggan and Robert Kocher weigh in on health-insurance exchanges. “Put simply health care reform will succeed or fail?based on two fundamental criteria: Do people?get the coverage that they were promised, and?that they want?” writes Cutler, who played a role in crafting the legislation. “And, do we change the delivery of medicine to promote high quality, lower?cost care?” [%comments]

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  1. Drill-Baby-Drill drill Team says:

    We come up short in international comparisons of health care principally because life expectancy lags despite the highest per capita spending for healthcare.
    For less than one dollar per capita we can employ several interventions that will lengthen life expectancy, increase happiness and decrease dysfunction.
    We already fluoridate the water to prevent dental caries. And chlorinate to reduce bacteria.
    We can use the water supply as a medication distribution network by introducing very tiny or trace amounts of medicines that have been known to reduce major diseases.
    1.)Simple cheap aspirin dramatically cuts rates of strokes, heart attacks and now recently proven in a longitudinal study reduces cancer death rates by 20%. Put ASA in the water supply-if would be cheaper than flouride,
    2.)High cholesterol is endemic and contributes to strokes and heart attacks. Just about everyone benefits from lower cholesterol. Put statin drugs in the water supply.
    3.)Up to 30% of parents do NOT believe in the value of vaccinations and many act on this belief. Utilize water borne vaccinations in the water supply, such as the oral polio Sabin Vaccine. Put Folate in H20 to prevent neural tube defects in fetuses.
    4.)Up to 40% of Americans will experience a diagnosable mental illness in their lifetime including depression, Alcohol abuse, Illicit drug abuse, Anxiety disorder, PTSD, Obscession-Compulsion, Eating disorders. Half of these will remain undiagnosed. And love ones suffer by enduring the mental illness like an affliction. Virtually all these maladies would benefit from Prozac type drugs which increase brain serotonin neurotransmitter. It is almost consider a vital tool in psychiatry: ‘Vitamin P’. Put Prozac in the water supply and we will be less sad, less depressed and less dysfunctional
    5.)Perhaps an effective future drug to treat or prevent Diabetes or Obesity-put it in the water.
    6.)Ban Tobacco products, the leading preventable cause cancer deaths, heart attacks and strokes. It would cost nothing in health care but would literally overnight vault the US life expectancy over the #1. Japan.
    7.)Restrict television broadcasts to 2 hours a night of quality programming from 8 pm to 10 pm. We get 24 hours of 1000 channels-99.999% is crap programming. It would force Americans to find other more healthy forms of recreation like walking, exercising, reading and even talking with each other.
    8.)Make supermarkets reflect a vegetarian diet. 80% of floor space for produce. 10% for dairy. 10% for the meat department.
    9. ) Tax Alcohol extremely regressively to the point that consumers have to hurt to make a purchase. They will value that little sip of brandy or Chardonnay even more. Make bottles much smaller at around 100 ml. Like a Coca Cola at the turn of the century: Medical amounts.
    10.) To increase calcium in young persons, make all flavored beverages and hydration drinks MILK BASED. A milk based Coca Cola. Your skeleton will thank you decades later.

    Make Public Health medication an automatic feature by incorporating it into normal plumbing. Let people OPT-OUT by buying their own water and we will have 95% participation. We now have an OPT-IN system for medicine that is not working.

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  2. Kai says:

    Here’s what I’d like to know from a Freakonomics perspective: statistically speaking, would you be better off spending $1200/mo for health insurance or spending $1200/mo on lottery tickets?

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  3. Eric Wilson says:

    @Drill-Baby-Drill drill Team: I SERIOUSLY hope everything you said above was a joke.

    I for one still want to live in an America where the government doesn’t dope the water, tell me how much Cola I can drink, tells me what to buy at the supermarket, or tells me what I can and cannot watch on TV (1st amendment anyone?). But if you are ok with a police state in the name of reducing health cost, more power to you I guess.

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  4. TS says:

    Kai,
    It would depend on the health of the individual. Or did you mean for the average person?

    According to the Kaiser Foundation (http://www.kaiseredu.org/Issue-Modules/US-Health-Care-Costs/Background-Brief.aspx), “In 2008, U.S. health care spending was about $7,681 per resident.” (I am curious how they are counting residents- undocumented workers, for example, are harder to count and include.)

    So for the average American, $1200/month is quite a lot to spend. But healthcare use isn’t spread out equally over all Americans- senior citizens, people with chronic conditions, etc., are using significantly more healthcare than, say, a young adult.

    -TS

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  5. Jimbino says:

    Of course, healthcare spending is much worse than spending on a lottery. The “loss ratio” that Obamacare requires of insurers must not exceed 80%, The loss ratio is the amount of premium dollar that an insurance company pays out for healthcare. The other 20% is attributable to profit, administration and other expenses, like advertising, which do not directly benefit the insurance victim.

    The insurance victim actually gets less than this 80%, since some of those funds are spent on things like research, etc, instead of on his health care.

    The return on lotteries and games of chance varies widely, but the return on Roulette, for example, exceeds 96%. So it makes much more sense to put your $1000 monthly premium on one spin of a roulette wheel than on insurance.

    Unless you are old or sick. Then you should vote for Obamacare, since it takes money from your young and healthy compatriots and gives it to you. The problem, however, with Socialism like Obamacare is that (as Margaret Thatcher remarked) you eventually run out of “other people’s money.”

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  6. Nosybear says:

    @Kai, your odds of winning the lottery are about 1 in 14 million (or 1 in 140 million if you play Powerball). Your odds of cancer are one in 7, heart disease 1 in 2. Now tell me where the money is better spent.

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  7. Drill-Baby-Drill drill Team says:

    @ Nosybear:

    Actually lifetime risk of dying from cancer is 1 in 4. (National Cancer Institute, SEER Longitudinal Survery).
    Risk of Stoke 1 in 5.
    Risk of Dementia 1 in 3.
    Risk of Depression: –always increasing.

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  8. Ian Callum says:

    Health care in the US is run by interlocking sets of monopoly operators. They will not allow costs to go down, and they have no incentive to improve quality. Americans will need to leave their country to obtain low cost high quality care.

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