The Value Problem: Healthcare, Medical Specialty Boards and Central Planners

Posted: April 9, 2012 in Economics, Politics
Tags: , , , ,

A New York Times editorial today discussed the findings of several medical specialty boards. Nine of these specialty boards have found 45 different routine treatments that add little to no value for patients yet, costs boat loads of money. In fact, the studies found that the several treatments often didn’t help some patients and sometimes caused more harm than good!

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With more recommendations on the way, the liberal editorial board at The New York Times is celebrating the opportunity to save the nation from useless medical costs. Since the US spends so much money on healthcare this can only benefit us, right?

Wrong.

The NY Times editorial proposes the question “Do you really need that test?” It then details these several reports and how expensive and unnecessary these tests actually are. Here is the problem. We premise the healthcare problem with a collectivist outlook.

The U.S. spends 16% of its economy on healthcare. The second highest of all UN countries. Therefore, the U.S. must do something to cut down these costs, right?!?!? The statement characterizes the issue as if the U.S. writes one collective check to the healthcare gods. The solution to the problem becomes, “how to reduce that check”. Yet, Uncle Sam doesn’t write one collective check. A huge sum of the healthcare payment comes from individuals seeking out healthcare treatments. Sure, you probably think you pay a lot in healthcare payments. However, if one of your loved ones has cancer is there any treatment too costly?

How about procedures that are deemed to have no value? The Times seems to think those procedures can be eliminated.

“Patients must take responsibility as well. They must discipline themselves not to request care of little or no value. To help patients make informed decisions, Consumer Reports is developing more-accessible versions of the lists and will join other organizations in disseminating them.”

Above is the problem with the collectivist approach to cost savings in healthcare. Sure if you, as a customer, deem a procedure to have no value than by all means cut your costs and don’t pay for it. That makes sense, but that isn’t what the Times editorial is saying. It is instead saying that medical experts have deemed that most individuals do not receive value from certain treatments and therefore those treatments shouldn’t be used. What if you aren’t most individuals? What if you would rather pay for the additional radiation, the additional treatments, etc. for peace of mind?

Is peace of mind worth the additional dollars spent in the healthcare market?

In Obamacare’s collectivist approach to healthcare, that peace of mind question would be answered by the government. If the overwhelming group of individuals do not think ‘peace of mind’ is a worthy tax payer expense, then the individuals who would like to pay for ‘peace of mind’ are out of luck. They could try a broken private market that is crowded out by government insurance or submit to the federal government.

The question of value cannot be answered by the government because every individual has a different perception of what is valuable in healthcare. Therefore, the government cannot set a standard for everyone. It is impossible.

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