Posted by: Jeff | September 3, 2009

The Moral Long View On Health Care

Ezra Klein links to a New York Times article, and discusses the problems involved in providing treatments that have very small benefits, but nonetheless cost oodles of money, and doing so without any real financial constraint or discipline.

In other words, we can’t say “no.” Even a drug that probably won’t work is worth mortgaging the house. Your spouse’s life, after all, is priceless. But this ends with us in a fairly troubling place: The ranks of pricey new drugs that might work — particularly if “might” doesn’t have to refer to a high probability — is advancing a whole lot faster than GDP, or wages.

This might not matter if we didn’t believe that every American had some basic right to these treatments, at least after they turn 65.

Julian Sanchez responds:

Do we believe that? That every American has basic right to extremely expensive drugs that provide very little benefit? It’s one thing to say there’s a shared obligation not to let people suffer or die when we know how they could live many years longer, or in much less pain. I find it a whole lot less compelling to suggest that people are entitled to public provision of, say, Tacerva—which the Times article says was approved to treat pancreatic cancers because it improves survival time by a whopping 12 days at a monthly cost of $3,500. Another is good for an additional month and a half on average, at a per-patient cost of $50,000. Is it only people who favor dismantling Medicare who might think that this goes beyond what people must have as a matter of basic justice?

I think Sanchez’s instincts for what criteria are – and more importantly, are not – included under the heading of “basic justice” are on the money. But I think he kind of misinterprets Klein.

If you were to go up to any average American and ask them, “Do you think anyone over 65 has a basic right to extremely expensive drugs even if they provide very little benefit?” I think they’d say “no.” (The same holds true if you removed the words “over 65.”) Nevertheless, providing everyone over 65 with any treatment they want, no matter how hare-brained the cost/benefit analysis, is basically what we currently do with Medicare. Klein is judging us by our actions, not our words or sentiments.

That said, I think Sanchez is correct again, at the conclusion of his post, that what we’re dealing with here is a psychological and cultural problem rather than a political one. No matter what the circumstances, be it a private market or a government program, we Americans just can’t stomach telling someone that the costs of giving them an extra few weeks or months of life isn’t worth it.

But telling someone that is hardly monstrous. That same amount of money, if properly spent, could go to giving someone else another few decades of life. And while this problem would apply just as much to a national single-payer system as it currently applies to Medicare, I think the moral case for expanding government provision of health insurance remains. Leave health care to the free market, and prices will continue to go up because we won’t tell anyone “no.” And ever greater numbers of Americans will gradually be able to buy less and less health care. Leave health care to our current patchwork of markets and government programs, and certain covered groups will get anything they want, those who can afford to in the markets will get anything they want, again all because we can’t tell anyone “no,” and ever greater numbers of Americans will gradually be able to buy less and less health care.

The problem isn’t really rising costs. In theory, health care costs could grow forever so long as our economy grows to keep pace. The problem is pricing out the lower economic portions of the populace. Just because the economy is growing doesn’t mean the buying power of all, or even most Americans is growing at the same rate, or at a rate capable of keeping up with rising health care prices. We can’t stomach telling people “no,” so we let affordability say “no” for us.

The problem is moral rather than economic. And the only way to solve it, in the long run, is to get everyone into the same buying-power boat, so that the burden of cost cutting falls equally on all of society’s various economic strata. I don’t know if single-payer is the only way to accomplish that, but it’s certainly the most obvious.

Also, Megan McArdle has some interesting points to add on the topic, which may or may not severely complicate matters depending on your perspective. At any rate, check out her post as well.


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