Thought for the Day - Health Care and Education

The most frequent justification I see from the Left for increasing government involvement and control of the health care system is that the US spends more per capita on health care than any other country but apparently gets little extra benefit from the spending in terms of health outcomes**.

Intriguingly, the exact same statement can be made of the American education system, which is already nearly fully nationalized.  We spend more per capita than any other country and get only middling results.  I wonder why those who use high spending with modest results as a justification for rethinking the health care system do not come to the same conclusion for the public education system?

To some extent, the US spends more on education and health care because we think are critical and because we are wealthier.  We spend on items way down the Pareto chart where we get less bang for the buck because we can.   And to my mind, it's no coincidence that both health care and education are dominated by third part expenditures.  Take the price value decision making out of the ultimate consumers hands, and, well, the whole price-value equation is bound to get screwed up.

** There are several reasons US often looks bad in these health comparisons.  The first is that we have a lot of life-shortening habits (eating, smoking, driving, crime) completely out of control of the health care industry.  So our lifespans are shorter, but control for those exogenous factors and our health care system looks among the best.  Check out this data, which shows that correcting for crime and accidents, US has the highest life expectancy in the world.

The other problem is the data is often cherry-picked by academics sympathetic to the state health care model.  As seen in the link above, we have the highest cancer survival rates in the world, and the highest life expectancy for people who reach 65.   Even our supposed out-groups, such as black males, have higher cancer survival rates in the US than the average in most European countries.  But you seldom see these metrics included in comparisons.

I also refer you to an oldie but goodie, showing how a study failed to correct for differences in lifestyles between countries.

  • Orphan

    Heh. Ever counted the number of times the US gets dinged in the WHS reports because we don't have a national health database?

  • Dan

    I'm not taking a position on your thesis here. I only want to say that I've worked in healthcare for 10 years, and also have two school-age children, and I don't think your premise works. You can't compare controlling costs in education and controlling costs in healthcare.

    And that's mainly because they're so different. Education hasn't changed all that much from when I was a kid 30 years ago, if I'm observing correctly from what my own kids are going through. Yes, the Internet is a valuable resource that they're using, and I'm glad our sixth grader can use it to stay organized and communicate with classmates about assignments (though he spends more time on Facebook, unfortunately); and our second grader just presented us a beautiful web presentation he made for a school assignment on civil rights. But mainly, education seems to be about having the kids sit in the same classrooms we sat in, with similar teachers teaching similar things.

    Healthcare has advanced a lot more in the last 30 years. Just think, 30 years ago, biologic drugs were hardly known. Now they're a $100 billion market, and are incredibly expensive and complicated to make. It can cost hundreds of millions of dollars just to develop one molecule. Some can cost $100,000 per patient per year. This is what we're dealing with in healthcare - science is pushing forward in a massive way and costs have risen accordingly because the treatments are far more complex. It's very hard to control these costs, because it requires some delicate decision making about which patients should be treated and which should not.

    I'm not arguing that we need to spend more public money on education. And I agree with what you say re. lifestyle changes that could help bring costs of healthcare down because you wouldn't need it in the first place if people would take care of themselves, at least in some instances. I'm just saying the two (healthcare and education) are so different that it's hard to compare them.

  • Chucko

    Which system is "better"

    Group A is forced to pay a certain amount for a certain outcome.

    or

    Group B chooses to pay more than them for a "not much better" outcome.

    I know my preference.

  • ColoComment

    BTW, I've read that U.S. infant survival is based on a different measurement than, say, Europe, i.e., live birth is defined differently, to the disadvantage of the U.S. in comparisons. it would be nice to compare apples to apples, yah?

    I don't think that I've ever seen what, exactly, is included in the term "healthcare," for purposes of comparison with other countries. Is it limited to direct, patient-served, care? Does it include/exclude hospitalization? Does it include/exclude pharma R&D and FDA testing? Does it include/exclude the net cost of health insurance (premiums paid less care expense)?

    Does it include/exclude nursing homes, visiting nurses, county health clinics, school nurses and the like? Does it include/exclude care provided by first responders? Flight-for-life patient transport?

    And that's just off the top of my head. What is being counted?

  • Damon Gentry

    Warren,

    I think you may have forgotten that while 'outcomes' are frequently cited, the core reason for the Dems to implement healthcare was lack of access. Remember the 30 million uninsured? While access to education in the U.S. is not an issue for them, any attempts to reform it would lead them back to the 'access' issue. Furthermore, while access to education is provided, there is no requirement to complete a secondary education. Although, President Obama did mention this in his last SOTU address, which I personally found chilling.

    The more pertinent question I have is this: For the 30 million who don't have health insurance coverage today, why are we know mandating that they either purchase a healthcare plan, or be fined? Is that really any help to the unemployed or under-employed?

  • Orphan

    Damon -

    That mandate doesn't target the portion of the "30 million" who can't, but those who can and don't want to. The mandate is there because the insurance industry (I should say the "health plan" industry, as they do NOT provide insurance in any meaningful sense of the word) demanded it as compensation for the other aspects of the healthcare bill; they have to take unprofitable people, but profitable people have to buy their services now, instead of opting out.

  • me

    @ColoComment - there are plenty of blogs that do detailled worldwide comparisons run by various stakeholders of the US healthcare system.

    The bottom line is that we're paying about 10x for outcomes that are essentially slightly worse than in other industrialized nations across a wide range of metrics (and the infant mortality is indeed a complete red herring due to different types of measurement)

    Education is much harder to measure, but again we're paying orders of magnitude more for outcomes that aren't visibly much better.

    Oddly enough, the last thing I'd think of in any context where an economic system is so far out of alignment would be "this needs more regulation"... then again, I am not only as left as they come but pretty much also as libertarian. I guess that does play a role ;)

  • caseyboy

    Our healthcare costs already reflect high costs due to government intervention. Compare the typical outpatient procedure to the typical elective procedure. The cost of elective surgery goes down as the quality goes up.

  • sean2829

    The scariest thing about healthcare is how those costs are distrubuted. It not like taxes where there is a progressive system based on income and the wealthy pay more. Rather the costs are distrubuted primarily through the private health insurance system so those costs are bourne per person or per household. So a median income family of $50K per year has health care expenditures of $20k per year (half by employer, half by employee. If you allow for the $10K of employee benefits, it means a third of earnings go to health care. I wonder how moderate income people would feel about health care costs if they realized that a third of their compensation was going to this one expense.

  • DoctorT

    "There are several reasons US often looks bad in these health comparisons."

    You omitted an important reason. Our infant mortality is higher than in most other developed nations because of reporting differences. In the USA, if a premature infant is alive at birth and dies soon after, we categorize that as an infant death. In most other countries, such deaths are categorized as stillbirths. The "extra" infant deaths in the USA greatly affect average life expectancy statistics.

  • frankania

    The obvious failure in both realms is GOVT interference.

    Here in Mexico, medical care is almost all private enterprise (at least for the middle-class). I have gone to several doctors at private clinics and paid as little as $1.50 & up to $45 for my cardiologist. I had a double cataract operation for $1400 including everything. Medicine is MUCH cheaper and no prescriptions needed.

    Private schools are the norm in most cities and families can choose the public school if they like it, or not.

    We run a B&B here and have had several "medical tourists" come just for dental/medical procedures.

  • me

    @DoctorT - that's precisely what I wrote in my post?

    The overhead in US healthcare is due to quite a number of factors - excessive testing, regulations that create enormous overhead, lack of economic feedback systems, consistent separation of decision maker, benefactor and payee, philosophy of overwhelming response... we're not just talking a red herring here, where we get 10x better care for 10x better cost, care is actually below the standard I've personally experienced in Germany, France and urban China.

  • http://sevencontinents@mindspring.com Benjamin Cole

    I have no problem with privatizing health care in the United States.

    I just wish we would have the same level of skepticism about military outlays. We are running 30 to 40 percent higher in military outlays than in the Reagan days (adjusted for inflation) and we have no serious military enemies (unlike the USSR, that Reagan faced).

    The Department of Defense-VA-Homeland Security combo now takes $1 trillion a year out of the productive private sector, and into the coprolite that is the federal government. That's $3,333 for every resident of the USA, or $13k a year for a family of four. And more next year and more after that.

  • dearieme

    I'm sorry to say that the attempts I've seen to rework healthcare comparisons read like attempts to explain away American figures rather than explain them.

  • http://shdhduhjf kailase

    I’m sorry to say that the attempts I’ve seen to rework healthcare comparisons read like attempts to explain away American figures rather than explain them.like

  • http://12365laima.com kaila

    I’m not taking a position on your thesis here. I only want to say that I’ve worked in healthcare for 10 years, and also have two school-age children, and I don’t think your premise works. You can’t compare controlling costs in education and controlling costs in healthcare.

    And that’s mainly because they’re so different. Education hasn’t changed all that much from when I was a kid 30 years ago, if I’m observing correctly from what my own kids are going through. Yes, the Internet is a valuable resource that they’re using, and I’m glad our sixth grader can use it to stay organized and communicate with classmates about assignments (though he spends more time on Facebook, unfortunately); and our second grader just presented us a beautiful web presentation he made for a school assignment on civil rights. But mainly, education seems to be about having the kids sit in the same classrooms we sat in, with similar teachers teaching similar things.

    Healthcare has advanced a lot more in the last 30 years. Just think, 30 years ago, biologic drugs were hardly known. Now they’re a $100 billion market, and are incredibly expensive and complicated to make. It can cost hundreds of millions of dollars just to develop one molecule. Some can cost $100,000 per patient per year. This is what we’re dealing with in healthcare – science is pushing forward in a massive way and costs have risen accordingly because the treatments are far more complex. It’s very hard to control these costs, because it requires some delicate decision making about which patients should be treated and which should not.

    I’m not arguing that we need to spend more public money on education. And I agree with what you say re. lifestyle changes that could help bring costs of healthcare down because you wouldn’t need it in the first place if people would take care of themselves, at least in some instances. I’m just saying the two (healthcare and education) are so different that it’s hard to compare them.