Sicko-phancy!

I will not comment on the movie, because I haven't seen it. I probably will see it; Michael Moore is a clever and amusing filmmaker and polemicist. But the general commentary seems to be that Moore has set up an opposition between “socialized” medicine and a “fee-market” system, with the former defeating the later. However, this is a false dichotomy: the American system isn't “free-market” and the European system isn't socialism. Both are merely a different combination of private market and govmint management. But defenders of either system usually practice a kind of sycophancy which ignores the faults of one and recognizes only the faults of the other. The truth is that medical care is an inelastic product (sick people will pay whatever they are charged to regain their health) that is provided through a series of monopolies or oligarchies. Licenses, patents, technology, and endless regulations (many of them actually necessary) tend to limit entry into the market, thereby preventing even a semblance of a free market. On the other hand, when medicine is “free” it is over-consumed, and waiting lists, rather than high prices, are the allocation mechanism. The European system does seem to perform better than ours, by most social measures, but only because they consciously adopt social measures and work towards them; the idea of a “common good” has not completely disappeared from Europe. However, there is some doubt as to how long such systems can be maintained, and in any case they make each person a ward of the state rather than a citizen. True, when one has a life-threatening disease, one may prefer to be a living ward of the state rather than a dead citizen; nevertheless, it is not an ideal choice.

Is insurance the answer?

Can insurance function as a middle term between the market and socialism? Not really. Insurance can only be a means of cost-averaging; some must pay too much and others too little, but one way or another, the cost must be paid by the users, which will price many out of the market. And healthy purchasers will seek plans that eliminate as many “risky” applicants as possible; they will seek the safest “risk pool” which is reflected by the lowest cost. So nothing is gained towards a universal, affordable system. But how about if we made insurance mandatory and universal? Fine, but that's just another name for a tax, and you're back to the same problems. And if you are going to handle it through taxes, it would be better for the govmint rather than the Hartford to collect the taxes. We used to believe that “private” business could do public functions better than the govmint, but that was before we learned about Halliburton, where two contractors do the work of one soldier on a “cost-plus” basis, with both the cost and the plus being astounding numbers.

In any case, and however you collect the money, if govmint provides universal care without expanding the supply of such care, the immediate result will be to expand demand faster than supply, which is to say, to raise prices. And the higher prices will require more taxes (I mean, “premiums”) or will require price controls, which will dampen demand, leading to waiting lists, not to mention a vastly expanded bureaucracy.

I have no easy answers, but I do have some suggestions about increasing the supply of health care, which ought to go a long way (if it is really a market system) towards reducing the cost. There are three “easy” things we could do, two on the supply and one on the demand side.

Increase the Supply of Medical Practitioners

Getting an M.D. Is an expensive and arduous task. But not all health care requires an M.D., while other types require quite a bit more. There should be different levels of licenses: midwives, nurse practitioners, general practitioners, medical doctors, and more advanced doctors of medicine. First line care could easily be provided by NP's working in their own neighborhood clinics, perhaps in loose association with a hospital or a GP or MD. In fact, as most have us have discovered, even when we go to “our” doctor, most of the service is actually delivered by an NP. Another area where this applies is in orthodontics. The is no reason why we anybody needs a degree in dentistry to install orthodontics; the work could be as safely performed by orthodonturists, and at a far lower cost. It is only the legal monopoly that dentists have on the business which keeps the prices so high, thereby denying this useful and normally affordable service to many poor people, while charging the rest of us unreasonable prices.

In a “free market” increasing the supply should lower the price; in any case, if we are about to increase the demand, which seems inevitable and should happen, we had better have a means of increasing the supply.

Replace Patents with Licenses

Currently, when a company develops a new medicine that get a monopoly on that medicine for a period of time, and they charge monopoly prices. But this is not necessary to fund research and development. R&D can be funded with licenses; that is, when a firm develops a new medicine they get the right to license that product to any number of production firms. The licenses should be for a longer term than the current patents, which will provide R&D firms with a much more secure revenue stream from which to fund further research. Manufacturers, on the other hand, will have to compete on price and service, and will therefore have to find the most efficient ways to manufacture and distribute the medicines. This also provides an easy way to fund third world medicines; the first world could just pay the license fees for less-developed countries, which could then produce the medicines locally, providing both inexpensive medicines and local jobs.

Improve Education

In the bad old days, when we had mothers that actually had the time to attend to children, a lot of advanced medical care was actually given by these obviously backward women. Well, nobody has mothers like that any more, but every school seems to have a “health education” curriculum. My impression of these classes, perhaps an incorrect one, is that they have little to do with health and a lot to do with condoms. No matter. There is no reason why they couldn't actually teach something about how to care for one's self and one's family, about how to actually use easily available products (and I don't mean the detritus of the patent medicine industry) to both prevent and treat simple cases. Mothers and fathers would thereby be the first line of medical practitioners. After, sometimes, chicken soup really does do the job, and at others, other simple remedies exist, if anybody knew about them. But as long as medicine is the private preserve of licensed practitioners, no one will learn anything.

Perhaps these suggestions are not so easy after all. For one thing, expecting mothers to have the time to attend to these things would throw women back into the dark ages of the Eisenhower administration, and nobody wants that. And both the licensing of medicines and a diversity of medical practitioners would introduce competition into the free market, and wouldn't that be a horror.