Sunday, April 10, 2005

The medical care problem.

Here is a statement of the problem as I see it.

First, people occasionally have medical emergencies for which there are treatments available that cost far more than they an afford. Currently this happens at least once per lifetime. At least once per lifetime there's a medical emergency that has treatment the person cannot afford, and the patient dies whether the treatment is done or not. Many people have one or more additional major medical treatment that they do survive.

To deal with the problem of rare emergencies that the person cannot afford, we set up health insurance. Healthy people pay for sick people. Provided a small enough minority gets expensive treatment, the system can pay for itself. This made sense. However, it turns out that far too many people have medical emergencies. And the insurance system got switched around from this sensible beginning.

"Systems expand. And as they expand, they encroach." The insurance industry could do collective bargaining. Each large insurance provider could negotiate cheap rates with hospitals etc to reduce its costs. This was a necessary measure. People want more health care than they can pay for, and at regular rates they would bankrupt the insurance industry -- or the industry would have to raise rates beyond what customers could afford. However, a side effect of insurance industry bargaining was that medical fees were increased for people who don't have insurance. If you want to buy a car and an insurance company wants to buy 10,000 cars, who'll get the better rate? If you want to buy healthcare....

Since the insurance companies could get good rates, they expanded into providing payment for routine care too. They could charge you less than you'd pay yourself for routine things, and still make a profit. When the uninsured rates for routine care rose to make up for the insurance discounts, the uninsured couldn't afford routine care either.

All this was not enough to cover rising healthcare costs, though. So the insurance industry did have to raise rates beyond what most individuals could afford. So employers were called in to pay for health insurance. If you have a great job, you can get great health insurance with it. Businesses that are raking in the money can afford to pay high rates for their employees. If you have a mediocre job then your company can afford mediocre health insurance, but it's better than nothing. If anybody is at fault it's you for not deserving a better job. This approach worked for awhile, for a lot of people.

But the rates kept rising, until increasingly businesses could not afford adequate health coveriage for their employees either. This encouraged them to hire part-time or temp workers who didn't get health insurance.

Meanwhile, costs kept rising and more people were uninsured by employers and could not afford insurance themselves. Many of them were voters. So the government stepped in to provide payment. As the costs continued to rise, it became more than the government could afford.

To reduce costs, both insurance companies and government needed "adjustors". They could cut costs by keeping medical experts from prescribing benefits that weren't necessary. How would an insurance adjustor with a 2-year degree, sitting on the 27th floor of an office building in chicago know whether your doctor's treatment was unnecessary for you? She can compare against common practice, compare against what thousands of other doctors are doing in similar circumstances. And except in a philosophical sense it doesn't matter whether she's right -- she controls the payments. She justifies her salary by the money she saves.

This distorts medical practice in subtle ways -- as well as the unsubtle ways. Say your doctor wants a medical test. He prescribes it, and it gets done by technicians in another windowless lab. It used to be those technicians were highly-trained med techs, but as they get priced out of reach more of the work gets done by trainees under the supervision of med techs, or under the supervision of former trainees. How much should your doctor trust those results? Clearly, as far as he can test them. So when he sends the lab two identical samples under different patient names and IDs, and the results are wildly different, that tells him something. When he sends a sample from a patient who ought to test normal and it doesn't, that tells him something. When he sends a sample from a patient that he already knows should test high and it doesn't, that tells him something. Etc. When he gets unacceptable results he can complain and get the lab straightened out or he can test out another lab. But none of this testing is legitimate as far as the insurance adjustor is concerned. Unnecessary tests are wasteful.

Nobody wants to be responsible for deciding not to give people medical care that they need. So we farm out those decisions to anonymous workers who will do the tasks demanded of them, and if they drink themselves into a stupor after work each day to forget the implications, it's nobody's business but their own and their doctors and their insurance adjustors. It's a natural progression to outsource those jobs overseas.

The whole thing comes because we want more healthcare than we can afford. So we look for somebody else to pay for it. First we tried to get the healthy to pay for the sick, but it cost too much for the healthy people to afford. So we got employers to pay, but it was more than they could afford too. So we went to the biggest money source of all, the federal government, and it's more than the government can afford.

Should we decide that your lifespan should depend on your wealth?
"If life was a thing that money could buuuuyyyyy"
"The rich would live, and the poor would diiiieeeee...."

So now what? It isn't like people are being unreasonable. They don't want to die.


Anonymous Blue Cross of California said...

Great blog I hope we can work to build a better health care system. Health insurance is a major aspect to many.

2:13 PM, December 02, 2005  

Post a Comment

<< Home