El Opinador Compulsivo

De PG, mi economista favorito:

This is a fascinating, extremely insightful, utterly unique, but unfortunately very long article by the brilliant Peter Huber. If you're short for time, here are the highlights:

• Socialized medicine was originally intended to spread the cost of health care across the broadest possible population. Now it is spreading the cost of risky behavior across the population. This is not efficient, since the people who decide to pursue less-risky behavior do not receive any cost reduction.

• Molecular medicine puts the patient in control. It tells him where his personal gluts and genes will probably take him years from now, and exactly how to dodge destiny by downing less ice cream or more Lipitor. The patient with this much personal control in easy reach will also, at some point, come to be viewed as responsible for failing to do the right thing.

• Insurance makes sense for risks that people can’t control. Or to put it more bluntly, socialized medicine was a smart idea back when medicine was too stupid to halt infectious epidemics, discourage suicidal lifestyles, or discern the perils in killer genes. But we’re now past the days when infectious diseases were the dominant killers, and heart attacks and lung cancer seemed to strike as randomly as germs. And insurance looks altogether different when your neighbor’s problem is a persistent failure to take care of himself. Many people willing to share the burden of bad luck eventually tire of sharing the cost of bad behavior.

• Most critics of the status quo focus on the more manageable of the two core problems that health insurers now face: runaway cost. But the real problem is that for many people, health care is getting cheaper. This is what makes actuaries wake up screaming in the night: disease is coming out of the closet, and the new medicine splits health-care economics in two. For the health conscious, skipping the Cherry Garcia may be difficult, but it’s cheap, and Lipitor at almost any price is much cheaper than a heart attack. The health careless skip only the pill, not the ice cream, and end up in desperate need of what helps the least and costs the most. Doctors, hospitals, and scalpels summoned late in the day cost far more, and accomplish far less, than chemistry tuned to the point where there’s never plaque to cut.

• No one-size, one-price insurance scheme can keep people happy forever on both sides of this ever-widening divide. Aetna can’t offer uniform coverage to individuals who face radically different risks, and who know it, too. Governments can’t, either.

• If they were allowed to, private insurers would respond with policies openly tailored to molecular profiles and priced accordingly. Insurers already do quite a lot of that kind of tailoring indirectly, by insuring through employers—work often segments insurance pools. Any private insurer that fails to push this kind of segmentation as far as it can will end up covering all the heart attacks, while competitors underwrite the low-fat or high-Lipitor diets.

• There’s the merciless fact of global competition. The cost of health care has a big, direct impact on both the cost of labor and the marginal tax rate. If California defies the new medicine’s economics by requiring insurers to ignore everything but age and geography, firms can flee to Texas, Ireland, or Shanghai. Efficient labor markets require efficient health insurance, which will be found only where actuaries are allowed to find out as much as the rest of us can, and craft policies accordingly.

• Governments are impatient, especially when they have promised to supply what they can’t possibly afford but can readily seize.

• Molecular medicine can only be propelled by the informed, disciplined consumer. Any scheme to weaken his role will end up doing more harm than good. Foggy promises of one-size, universal care maintain the illusion that the authorities will take good care of everyone. They reaffirm the obsolete and false view that health care begins somewhere out there, not somewhere in here.

• The thought that government authority can get more bodies in better chemical balance than free markets and free people is more preposterous than anything found in Das Kapital.