Friday, September 4, 2009

Is US Health Care Broken?

One of the arguments made by proponents of health care reform is that the US system of health care is clearly broken because we pay so much more than other countries for health care and have worse results. Indeed, the overall statistics bear this out. We spend twice as much per capita and have lower life expectancies and higher infant mortality rates. Is this not proof of the need for change? Perhaps not if we look at individual results instead of averages. Suppose both Rich and Joe are dying. It would cost $100,000 in medical costs to extend Rich's life by one year while it would only take $50,000 to extend Joe's life by two years. From an overall statistical perspective, it would make more sense to save Joe's life. But what if Rich has $100,000 and Joe is broke. Rich might prefer to spend his money to save has own life, and the only way to save Joe is to forcibly take Rich's money from him through taxes in order to pay for Joe's treatments. While this might benefit Joe, Rich is now dead and out $50,000.
So, is this reflective of our current situation? Evidence indicates that this does play a role. While our overall spending is high and our overall results are low, if the results are broken down into subgroups the picture changes. Life Expectancy of Whites and Asian-Americans are inline with European and Asian averages while the life expectancy of African-Americans is lower than the life expectancy of other ethnic groups in the US, it is higher than the life expectancy in African nations, although this is not necessarily a fair comparison.
This is the health care debate in a nutshell. Many people I know and respect believe that health care should not be determined by how much money a person has and that it is fair and preferable that health care should be allocated on the basis of need while the costs of those resources should be borne by the people who can pay. Such a system would indeed lower costs and improve overall results. I would take the opposing view that it is an individual's right to allocate their wealth in a manner of their own choosing.

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