December 15, 2003

I promised: a response to RangelMD

Dr. Chris Rangel's criticism of the single-payer proposal advanced by Dr. Steffie Woolhandler and the Physicians' Working Group for Single-Payer National Health Insurance is thoughtful and a pleasure to read.

Unfortunately, it suffers from a misunderstanding of the reasons for our current health-care problems, and from a misunderstanding of Woolhandler's proposal.

These twin misunderstandings are rooted in an inaccurate conception of the "free market."

Although the health care industry does not entirely fit the economic model for a free market it does have enough elements of a free market system to make it vulnerable to unintended consequences of a single payer system.

Rangel surely has it right here; in fact, there is always a risk of unintended consequences whenever a society embarks on any reform effort. For example, in the early '90s, our nation attempted to solve the problem of skyrocketing healthcare costs by introducing market reforms intended to improve efficiency. HMOs, utilization review, investor-owned hospital chains, and similar market-based mechanisms would, we hoped, introduce the "discipline of the market" into the old fee-for-service system and lead to lower prices.

Unfortunately, there are often unintended consequences of increased privatization and reliance on market mechanisms. As Woolhandler et. al. point out, these efforts have largely failed. Quality of care in for-profit hospitals is often lower than in public or non-profit hospitals; patients are frustrated by the reluctance of HMO's to cover needed services; physicians resent being second-guessed by insurance bureaucrats, and the drug industry continues to market "me too" drugs while pricing many of their other products out of reach of many sick and elderly patients who need them. This behavior continues despite the fact that the drug industry continues to have the highest per-capita return on investment of any industry in America, all while paying the lowest taxes of any industry.

Given these facts, Dr. Rangel's comparison of Woolhandler to Karl Marx, and his equation of basic healthcare to a government-secured right to own a car, is no more than hyperbolic rhetoric, and is not helpful.

Rangel eventually moves on, fortunately, and addresses Woolhandler's proposals to reign in drug prices:

It costs a drug company potentially hundreds of millions of dollars to investigate hundreds of compounds through hundreds of clinical trials just to bring one product to market and hope that it pays off. What company is going to invest so much to develop a product that the government ultimately won't pay for or won't pay enough in order for the company to cover the development costs and make a profit?

Despite Dr. Rangel's perceptive critiques of the drug industry elsewhere on his blog, this language could easily have been cut-and-pasted from PhRMA's website. That Dr. Rangel would resort to these arguments so easily is itself persuasive evidence of the success of PhRMA's attempts to aggressively lobby the public and physicians, all in the name of the following fallacy: if we can't reap outrageous, absurd, and unjustified profits, then there will be no incentive for us to develop new drugs. "Profits merely in line with the average industry profit in America? Nope, no new drugs."

The "free market" that Dr. Rangel continues to look to as the salvation of our health care system itself treats this argument of PhRMA's as complete and utter nonsense. Profit is profit. Woolhandler never proposes eliminating drug industry profits. Her proposal is for the national health service to "negotiate drug and equipment prices with manufacturers based on their costs, excluding marketing or lobbying." (JAMA 2003; 290:798-805 p. 801).

Despite the problems with Dr. Rangel's post, his descriptions of the problems with our current system are excellent:

- In America, no elderly person is supposed to die a "natural death". Even when they live in a nursing home with severe dementia at the age of 90 the second they develop shortness of breath we shove them into an ambulance, rush them to the ER, stick a tube down their throat, put them on a ventilator and spend tens of thousands of dollars on critical care for this patient as they linger in the ICU with multiple complications before ultimately dieing a month or two later (I have seen this more times than I care to count).

- Partly out of the fear of lawsuits and partly because the patient and their family expects it doctors inundate patients with a ton of radiologic scans, blood tests, biopsy’s, specialist consultations, and monitoring for even the most basic hospital admission.

- American patients expect a pill for every ailment and we do our best to accommodate them.

- Even if patients have spent years abusing and neglecting their own bodies they expect us to spare no expense when it comes time to treat their conditions when their abuse catches up with them.

- There are more MRI scanners in Washington state than there are in the entire nation of Canada and we perform almost 5 times more angioplasties per capita here in the U.S. than in Canada.

Dr. Rangel could, however, have gone further, and contrasted these examples of overtreatment with the fact that despite all this wasteful extravagance, America falls short of most of the rest of the developed world in such measures as infant mortality and life expectancy. Rangel criticizes Woolhandler's plan for it's assumption that a single-payer system would deliver the "same amount of care" as our current system. This is wrong. Woolhandler's plan recognizes that these disparities in the distribution of our heath-care resources are unjust, and suggests that her plan would change this. Presumably, it would help to decrease the wasteful spending Dr. Rangel criticizes and increase the resources currently unavailable to children and the poor, which Dr. Rangel barely mentions.

Many Americans complain about not getting what they pay for in medical care but then again most Americans have never experienced the kind of care that is the norm in countries with nationalized health care systems.

And what norm is that? Higher life expectancies? Lower rates of child mortality?

Rangel opines that the high usage of health care that Americans have become accustomed to (which Americans?) is the "single reason why a Woolhandler type nationalized health system would never fly politically in this country."

Actually, the single reason why Woolhandler's pragmatic and decent proposal won't fly is that physicians as intelligent as Dr. Rangel become irrationally apoplectic whenever the words "single-payer" or "Canada" are mentioned.

Posted by Carey at December 15, 2003 03:19 PM