All modern healthcare systems have become unsustainable. This is the obvious result of the extension of medical coverage to those who cannot afford it. While many pundits and politicians blame each other, the central cause of the problem is an overestimation of the capacity of a healthcare system to accommodate perverse incentives. As the number of sick have outgrown the number of healthy people, more revenue is needed each year, leading to never-ending cost increases. Socialism fails, and has always failed, because it fails to align benefits with costs. It introduces moral-hazard, which occurs whenever a benefit can be gotten without paying its true cost. In healthcare this has occurred because the costs of many preventable diseases have been paid for by the healthy, which removes the incentive from the unhealthy to cure their poor choices. The crisis will never be solved until moral hazard is removed.
A spectre is haunting modernity — the spectre of healthcare. All the powers of modernity entered into an unholy alliance to embrace this spectre. The media, educational systems, corporations, politicians, grasping voters and even sickly patients have united in an attempt to univeralize healthcare. For Christian charity and socialism has been decreed across the land, and it is said that we must care for the illnesses of all people. Where Christ healed by the power of God, we must cure by corporate-profit and pseudo-medicine. And what is the act of Atonement to pay for this forgiveness of illness? Universal healthcare. Either by means of government nationalization, health insurance, or some hybrid of the two, socialized medicine is already upon America, as it was in Europe so long ago. And what does it bring us? Catastrophically rising costs.
All universal healthcare systems suffer from the same problem, be them government sanctioned or private markets. In this regard free-market capitalism is indistinguishable from socialism or communism; and indeed the distinction no longer matters in America nor Europe, for we are now all ‘christian-socialists’!
The essential problem is that there are more ways to be sick than there are to be healthy. Any increase in the ability, or desire, to cure disease will only, from the economic side, increase healthcare costs. For the healthy will never have need of doctors and hospitals, and so the more illnesses that are treated, the higher costs will rise. And the last few decades have seen the ‘cures’ (to use the term lightly) of many diseases emerge and become covered under standard insurance plans. And while most these ‘cures’ are mere treatments, it has not stopped the predictable from happening: rising costs. Unfortunately, treatment contradicts the purpose of medicine, for it never returns the sickly back into the healthy camp, and so society has grown increasingly sick.
Demagogues, politicians and other experts are seemingly surprised and worried about the crisis. While the voters, politicians, corporations and health-workers all blame each other, the problem is not theirs to wear. Indeed many childlike fantasies have emerged as ‘solutions’ to this crisis. One can hear the mantras from the various political parties or pressure groups, “We need a universal healthcare plan to reduce bureaucratic inefficiency”, to which another responds “We need to reduce the malpractice costs in tort-reform”, to which another says, “If we reduce medicare payments it will force the corporations to be more efficient”, to which even another responds, “If we extend coverage to all Americans, insurance prices will go down because we’ll spread the costs over more people”, and so on, and so on. None of these ideas will help the problem, for there is no reason that they would.
The crisis of healthcare is not a crisis of bureaucratic mismanagement. It’s not a crisis of corporate greed. It’s not a problem of privatization and capitalism. Indeed it’s not even really a problem of corrupt politicians. For America isn’t the only country with this crisis, and indeed virtually every European country with a universalized system has the same basic problem — healthcare costs are rising to unsustainable levels. Europe has been able to hide some of this by reducing expenditure, but this has created an even more pressing crisis for them: reduced services. And indeed the crisis in Europe is not costs, but the lack of services in general. While most people barely have enough time to keep up with the news in their own country, even fewer track the foreign press. But for those that do, particularly during campaign seasons, it is quite obvious from places like Canada or Great Britain that healthcare is a top priority, and indeed are suffering from the same essential problem as America.
And why wouldn’t Europe be suffering from the same problem? After all, if there are more ways to be sick than to be well, and if a society insists on treating virtually all illnesses no matter the cost, no reasonable person could expect any other outcome. It’s the equivalent to putting cat-food out, and then wondering why your house is surrounded by cats! You’ll always get more of what you pay for. The more you provide for cats, the more will come. Similarly, the more sicknesses we provide for, the more sick will come wanting treatment.
But why is this you might be wondering? It’s a problem of perverse incentives. Human behavior is governed by cost-benefit analysis. If something costs us, we’ll tend to avoid it. Where-as if a benefit is cheap, or free, then why not partake? Healthcare, like all forms of grouping-together, introduces a contradiction. For if many people are forced to bear the costs, it becomes easier for each individual to cheat a little.
Imagine you go to a nice luxurious dinner. You have a choice of inviting a group of say 10 people, or going alone. Imagine that you’re really hungry and might want to order a lot of food. Will it be cheaper if you go alone, and pay for all of it yourself? Or will it be cheaper to go with 9 other people, and when you split the check, only pay a-tenth? Obviously it’s cheaper in a group. For the extra cost is split among nine others. Now, if one’s friends don’t notice what you did to them, and still share the cost with you, they might remember it and do it again later. For the next time, they might all try your strategy, and then the bill will increase for everyone.
This is what’s happened in our healthcare system. We’ve all tried to participate too much, while trying to spread the costs around to more people. Eventually however, people catch on and will begin abusing those services themselves. Now, you might think that this analogy is strange considering that most people don’t ‘choose’ healthcare like they might from a menu, and that’s very true. We should however remember that this story is not about choice, it’s about the expectation to split the meal evenly among all the people. Instead of worrying about who gets which disease or meal, the ideal thing is to split the cost individually. Rather than pool the check, what’s wrong with each paying for what they themselves use? After all, we don’t have expectations of sharing our paychecks (excepting violence-enforced taxation)?
This brings us back to Christianity and socialism, for those who are formal Christians, that is, people who believe in the form of Christianity, even if they reject the Bible; might worry that some diseases are unaffordable. Indeed they are. This is the fundamental problem. For today we can treat many more diseases than we could in the past, if cost were no object. Unfortunately, cost is an object. It is an object for society, and it’s creating an unsustainable healthcare system that punishes good and healthy people, in order to pay for everyone else.
And this is where my unhealthy readers might want to look away. For many modern healthcare diseases can be prevented. Those that can’t should be limited in their treatment, unless they can afford it individually. For America should not be a socialist country, but indeed we have allowed ourselves to be seduced by those ‘christian-heretics’. The three biggest drivers of increasing costs are cancer, type 2 diabetes (which shouldn’t even be called diabetes) and heart disease. All three of these are primarily associated with unhealthy behaviors, and all of them lead to a permanent treatment model, which is great for doctors and drug-makers, who benefit from continued payments, despite dubious medical benefits.
As we analyze this crisis, we need to understand it from two sides. On the first, we find ourselves against the unhealthy choices of people, and the sheer cost of modern medicine. This is where the dinner analogy will gain a bit of traction, for healthy behaviors are more personally painful than unhealthy ones. It’s easier to be overweight than to maintain a fit and trim body. It’s easier to eat junk food and sugar, and blame genetics than it is to eat wisely and exercise. The easier it is to cheat others for one’s own problems, the more perverse society will become.
The second half of the healthcare problem is the treatment model of corporations, politicians, and the seduction of universal coverage. In these it is very easy to blame them for our problems. And certainly they aren’t helping the situation, but both of them are mostly innocent. For politicians tend to act in the interests of their supporters, and indeed most Americans have voted for these increases in coverage. In the case of diabetes for instance, it was considered unprofitable to insure them in the 1980’s in America, mostly because insurance was designed for catastrophe, not indefinite treatment, and especially not one that’s as easily preventable as diabetes. Consider for instance that car insurance won’t cover your oil-changes, new tires or other basic repairs. It is designed to pay only for the unforeseen car wreck. However voters decided that it was important to add diabetes to mandatory coverage, and so most states passed laws in the 1990’s forcing health insurers to cover this condition. And what happened in those states? Healthcare costs rose precipitously, and even the people in those states got measurably fatter!1
In the same way, corporations are merely servicing the desires of the American public. Corporations have one goal: to make a profit. If they can find a way to provide a service, be it healthcare or anything else, they will find a way to do it profitably. And as the American public has cried for more and more generous coverage, corporations have found devious and cunning ways of giving it to them, and profiting from it! If we stopped supporting an unsustainable system, they’d merely find some other way of making profit. Like politicians, there are many other ways to do things, and so would merely find something else, if healthcare wasn’t so important to us. And indeed, it’s because its important to us, that things have gone as they have. No amount of reform to these will ever change the problem, for they are merely a messenger.
