2/04/2006

02-04-06 - 1

02-04-06

If you're a big free-market guy, you must see there are quite a few huge economic advantages to national health care. By disassociating the health care from the job, it gives workers more freedom to leave jobs and change jobs. This increased fluidity is great for economic engines; any "binding" or friction factors in capitalism are major impediments to functioning markets. Another is the massive amount of administration burden both to the companies and the workers of managing the health insurance and benefits packages that employees get. Some of that same work would have to be done by the national program, so that would zero-sum, but a lot of it goes away, because you're never changing programs, you don't have to figure out new policies and benefits and get new doctors, etc. etc. you're always on the same plan.

Health care costs have been rising way faster than inflation. Some of the rise in Medicare costs are because there are more and more old people. The solution to that is obvious - kill anyone over 70. Okay, I'm joking (mostly), but even if you normalize out that factor, the cost of health care for a middle aged person has gone up way faster than inflation. That's very strange. Naive people say it's because care has gotten so much better, so it must cost more, right? Nonsense. In almost every other discipline, gains in quality are roughly matched by gains in efficiency, so that costs stay similar.

Part of the problem is surely the insurance model, in which a very few people who receive super-costly care drives up costs for everyone. I have no idea to what extent this is actually happening, but it makes some sense. The same is true for things like car insurance - the majority of the costs come from the rare massive payouts. Perhaps less than 1% of the population incurs super-high health care costs.

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old rants