Driven to Unhealthy Expenses

In life we all have to pick our battles, and this just might be a battle of mine. You can go read, and I recommend you do, however I will be pulling quotes here. Get ready for this, it’s another 6-feet of Hamm On Wry.

Massachusetts has decided that they are going to treat human bodies like automobiles. Just as every driver must have car insurance, to protect themselves and others, now every body must have health insurance. Um… ok, why?

I get why drivers need to be insured. I’ve been in too many accidents and had too much damage done to my body that required some medical attention. I’ve also hit a few people myself, but I’m sure that the universe was just using me to teach them. Except for that one time when I hit this guy and found out that my insurance had lapsed when I called in to my agent. Yeah, that was fun. It was very minor damage and I paid it immediately out of pocket, but still, that was a nerve-wracking, balls-in-a-blender moment. Yes, insurance sucks, the companies are mostly hateful, but when you need it, damn it’s needed.

But that’s for driving, which is privilege. If you want to drive, you have to learn to, pass a test, get a license, and have insurance. Breaking the driving laws can result in the loss of driving privileges because driving is not a right. Let me repeat that for the deaf of the audience:

DRIVING IS NOT A RIGHT!

Privilege:
noun: a special right, advantage, or immunity granted or available only to a particular person or group of people
example: education is a right, not a privilege | he has been accustomed all his life to wealth and privilege.

It makes sense that a privilege involving a mechanical device weighing anywhere from ‘adolescent pachyderm’ to something north of a ‘tectonic plate’ would require some sort of monetary ‘just in case’ support. Insurance companies bet that you’re a safe driver who won’t get into an accident. While accidents happen, the vast majority of insured motorists aren’t involved, so for car insurance, the Insurance company is like Vegas – the house always wins.

Car insurance companies have some risk whenever they take on an insured, but their business model accounts for that and is still quote profitable, mostly because of the difference between those who have accidents with huge payouts, which is minute, compared to the number who just pay their premiums but don’t ever need to use the insurance, which is a vast majority of their customers. Any risk is implied but seldom is it realized.

However…

The medical needs of the human race put the healthcare insurance companies in a completely different scenario. We all have medical needs, and therefore, medical bills. With nearly 100% of the revenue source also being an expense, profitability is already in danger. With medical services costs rising so dramatically year after year, it’s impossible. So what was ‘insurance’ is now ‘subsidy’ because no matter how much you pay, the costs of services and the fact that someone will need them, means that the money is spent immediately if not sooner. Investing can’t happen, nor is there a comfortable cash flow to keep the company afloat.

So why not require everyone to have coverage? It would seem logical to extend coverage to everyone as that might increase the cash flow into the insurance companies as the number of clients might actually be larger than the number of patients. But again, that can’t really happen, because the gap is still going to be narrow since most of us would like to keep our health, and the costs of major trauma not exponentially more than other services, they are astronomically more, so even if the gap between customers versus patients widened to the level of insured versus morons-with-dents the costs of trauma could easily eliminate any positive cash flow.

Recently Michael Kinsley wrote about health care reform and while his basic idea is sound, I find that the overall argument he makes is only sensible if you consider medical help separate from medical research. I would think it was obvious that medicine is all the same business, but apparently not. Kinsley wants to ration out medical care and allow those with the funds to opt out of the rationing system by paying for their entire medical care themselves. Again, by just looking at the immediate care provider side of medicine, this can look great, but when the entire picture is covered, you realize this is a pointless exercise. The new law in Massachusetts doesn’t explicitly state that rationing-with-an-elite-class-opt-out is exactly what this law is doing. It’s not socialized medicine, as that’s just miserably slow and useless. Massachusetts has decided to go for communist healthcare in the style of Moscow circa 1983. Kinsley is bright enough to point out that healthcare insurance is, well, here’s what he says:

Krugman and Wells note repeatedly that 20 percent of the population is responsible for 80 percent of health-care costs. But that doesn’t explain why health insurance should be different from other kinds. The small fraction of people involved in auto accidents in any year is responsible for almost all the cost of auto insurance. You insure against the risk of being in that group.

What’s different about health insurance is the opposite: Much of it isn’t insurance at all but a subsidy. The value of the subsidy is the difference between what the individual pays and what the insurance would cost in the free market. If people were buying health care or insurance with their own money, they might or might not spend too much—whatever “too much” is—but no one else would need to care if they did.

A subsidy has to take from someone and give to someone else. Everybody can’t subsidize everybody.

And he’s right, so far. However, while he understands the services part of the equation, he has not included research at all. Halving the system for a theoretical discussion is fun mental masturbation, however it’s not something that can be applied to the real world. Since medicine is plagued by the very real uncertainty of how life works, all doctors are doing research every day, even when they are just reading charts, so the other parts of research could not be unimportant enough to simply dismiss.

Kinsley sums up the article thusly:

Should people be allowed to opt out of rationing if they can afford it? That is, if the system (private or single-payer) won’t pay for the $100,000 pill, should you be able to pay for it yourself? Fear that this would not be allowed helped to kill the Clinton health-care reform 13 years ago. But explicitly granting some people life and health while denying these things to others is hard, even though this disparity has existed throughout history and is probably unavoidable. In fact, a serious defect of single-payer is that it makes all sorts of unbearable trade-offs explicit government policy, rather than obscuring them in complexities.

There are the makings of a deal here. Better-off or better-insured people could be told, individually or as a group: Give up your health-care subsidy, and you may opt out of any rationing-type restrictions that the system imposes. And if a few smaller reforms like that don’t work, maybe, it will be time for single-payer.

Yeah, uh, no. The problem isn’t deciding who gets the $100,000 pill and who doesn’t, it’s that the pill costs $100,000 in the first place. Pharmaceutical research is the source of this insanity, and as Kinsley didn’t even include it in his thinking, his answer is lacking as well.

There are some things about human beings and medicine that you should understand, as that’s also a part of the costs and their rocketship ride out of this world.

  • Every person is different, and doctors and medical staff have to adjust from the established baselines based on statistical analysis to the specifics of each patient. As evidence, I will point out that the rumor that everyone is 98.6º was disproven by my 8th grade science teacher who had us test everyone in the room. No one was sick, but body temps varied as much as three degrees from the established baseline of 98.6º. I would like to point out that most people are laying in bed hoping to start sweating at any moment when they are 101º, but for some, that’s their normal. Doctors have to deal with that when treating those people.
  • The same chemical can have a vastly different effect on different people. GHB is a rather popular drug in the nightclub and party scene, which is where I work. I’m bringing up GHB because it’s popular for how it makes you feel, but it’s exceedingly dangerous. What is a dose to get one person high can easily kill another and have no effect on a third – and it won’t matter their race, height, weight or anything else. You won’t know till you die try, so load it up and see what happens. GHB isn’t the only substance like that, almost every substance has a range of effects. It’s really easy to see that medicine is not a concrete science.
  • Medical research can be patented, but only on newly discovered or manufactured drugs, which is why you constantly see new schmarketing for things with made-up names. Once a drug is approved by the FDA the only company to make it legally is the holder of the patent, for a certain period of time. Drugs protected by patents are priced by the corporate greed rather than the market as they have a monopoly on that drug.
  • Newly patented drugs and the research into them costs plenty so companies routinely apply for and receive government money. Once a drug is approved by the FDA, the patent belongs to the pharmaceutical company, and while the government funded the research, the government gets nothing from the profits. In many cases the government is also the largest and most deeply gouged customer for these drugs. So if you buy a patented drug, chances are you bought it twice, too, and possibly three times.
  • Pharmaceuticals make their money from drug patents and the production and sales of those drugs. The research teams at these companies have no reason to do research into drugs or combinations of drugs that are out of patent, because no matter what you discover, you can’t patent the past. If a drug isn’t patentable, it’s not profitable. And if it’s not profitable, where is the incentive to do research?
  • People go to the doctor for a check-up to see if their gut-feeling that most everything is in good order is legit. This is the part of the equation that would be solved readily with the changes that Kinsley proposes, and that’s fine, but it’s not the major expenses. And all the real costs are on the patient anyway – a day of vacation time, and a dose of frustration with any issues dealing with their insurance.
  • People go to the emergency room when something has eaten half their leg and they need immediate care. Are you going to tell a girl who had her leg bitten by a shark that she can’t get help because the medical procedure she needs is going to cost too much? Kinsley thinks we might be forced to do just that. I don’t. Massachusetts seems to think they can not only tell the girl that she can’t have the procedure, they will write a ticket for her not having insurance!

So we have patent monopolies controlling the research side, which is also why we get pills that cost more than a house. We have companies that are built upon the brain-power of people who thrive on science, but the executives receive millions of dollars for controlling the research, the patents, the production, the distribution and the costs of new medicines. Every cent of money that goes from the government into research is given, not loaned, so in effect, We The People are getting raped on it’s production.

The list of problems with medicine go on and on, each more angering and stupid than the last, but I’d like to go back to that same 8th grade science teacher who had another point to make, one of those profound moments that has stuck with me forever, not that I’ve really acted on it. He asked us to ponder a situation.

You’re going to be driving soon, and some of you will get cars of your own. Now imagine if that car you were going to be given a car. Each of you. It’d be a random drawing, so you might get a Mercedes, you might get a Mercury, you might get a Model-T, you don’t know, and no one else does either. But you’re going to get a car! Pretty cool, huh?

Now imagine that this car you get, no matter what shape it’s in, this car is the only car you’re ever going to have. You can’t get another, you may not be able to find parts for it if you wreck it, you can’t replace it, you can’t trade it, you can’t sell it. You can’t even paint it. It’s yours, but it’s only yours. And it’s your only car. And if you wreck it, or abuse it, or it just is a lemon and dies, that’s it. Nothing more. Done. You don’t get another car. Now what do you think about it?

Perhaps you should realize that you’ve already gotten your ‘car’ and there’s nothing you can do but try to keep it in good order. You only get one body, you only get one life. You can’t replace an arm magically, you can’t always find a spare liver. You might lose your sight without notice. You don’t know, and you have no choice in it, but it’s yours.

I think that is the only piece of wisdom that eloquently turns the human body into a fantastic day.

Perhaps the lawmakers of Massachusetts didn’t really get it. Massachusetts wants to extend the “created equal” part of the Declaration of Independence to include their citizens’ bodies, and when you want to take your body out for a life, just like taking your car out for a spin, you have to have insurance. I can’t even begin to describe the feelings I have towards the entire state of Massachusetts, because their courts get what it means to be alive now, but their lawmakers are asshats.

I guess I shouldn’t be surprised, tho, since apparently even a Princeton Economic Professor thinks this is a good idea. Here’s the quote from the Washington Post article:

The idea was applauded by Uwe E. Reinhardt, a professor of economics and public affairs at Princeton University, who said that he has long believed that the American system of allowing uninsured patients to receive care at the government’s expense was nothing more than “freedom to mooch.”

“Massachusetts is the first state in America to reach full adulthood,” said Reinhardt, noting that the new measure is a move toward personal responsibility. “The rest of America is still in adolescence.”

Princeton should fire this twat. People aren’t mooching off the medical system when they visit the hospital for an emergency, and the law doesn’t change anyone’s access to actual healthcare. The article goes on to state, “Enforcement of the requirement will not be done by hospitals, officials said: They will treat uninsured patients as before.” so nothing has really changed in the field of medicine, yet they’ve managed to pass a law that will cost huge sums of money, they’ve created a new complexity to their state tax return, another way to start an audit, and a relatively high monthly expense that might not cover what they need for healthcare, or could reduce their level of care because of how the system is designed.

Kinsley’s arguement fails because when a rationed system overloads with patients, slowing down the service, the costs to provide medicine won’t go down, they’ll still go up, and can go up faster the slower the actual service. How long have you sat in an emergency room waiting to be seen? When someone who really needs attention is forced to wait, their ending bill is going to be more, and that’s just one pretty obvious example.

How many employers are going to voluntarily offer health insurance when, since it’s both “cheaper” and “easier” to get, they can force their employees onto the state plan. Let’s be quite clear, the state is requiring the citizens to have insurance, but they aren’t requiring the businesses (which don’t vote and don’t have rights) to supply healthcare to all their employees. I don’t understand the reasoning, but it’s a law written to ‘help’ the citizens, supposedly.

The caps put in place by the law will be much less than the amounts that the public sector businesses will be asked to pay – so what will they do? Pay? Are you high? There isn’t something in the law that says that businesses must have insurance, and since the state is going to cover anyone without, many companies in Mass. will end that benefit. It’ll be much easier and cost effective for them to drop the benefit and pay them the state’s rate more each month.

Then House Speaker Salvatore F. DiMasi, a Democrat and perhaps the biggest blowhard involved, said, “We did something to solve the problem,” he said. Yep, that ‘something’ was to write a law that will strap the entire state citizenry on the state’s healthcare plans because

  1. the pricing structure is part of the law, so updates will require a legislative session and lots of trust. yeah.
  2. Let the rich pay out of pocket for their healthcare if they want. However, the plans’ pricing caps will invariably be less than what businesses will be quoted on plans for their employees, and businesses aren’t going to pay more than the state. Soon every employee in the state will be abandoned to the state-capped plans. Even if the caps are the median costs now, in a year’s time it won’t be, and in 4 years the cap won’t have moved, but medical expenses will have jumped over the moon.
  3. The Massachusetts law doesn’t alter anything about the hospitals’ policies, which means they didn’t change anything about the costs of doing business there.
  4. Doctors can still be sued for malpractice, and the damage award limits have not been reduced, so horrendously stupid billion dollar awards can still be awarded by juries. Then malpractice insurance goes up. Oh, and those same companies that provide health insurance also provide malpractice insurance, so they can and do raise the rates for a doctor’s malpractice insurance. And guess who really pays that?
  5. The law doesn’t seem to cover how to qualify a person other than by income, so everyone can get the coverage, right? Sure, we think. But the state doesn’t even have a rural plan in place, they lack the resources to support those places.
  6. More importantly, which of the insurance companies is going to actually do business in Massachusetts anymore? Not one. Since the state created these plans, how can other insurance companies compete? And I’m wondering how the state plans really work, but only because if they passed a law saying that everyone has insurance, but it ends up being a sleight-of-hand tax situation that doesn’t actually help thep people, we might have a big issue.
  7. Just realize that the government is now the pricing manager for the entire state of Mass via their medical bullshit stupidity. The state is going to tell doctors what they will be paid for each procedure.

Massachusetts has created a law that is set to backfire. Since they went bonkers and killed an industry and shackled it’s citizens right to the government teet. A professor at PRINCETON who teaches economics but apparently doesn’t understand how his field applies to reality is cheering this on. I’m waiting for pigs to fly, the Four Horsemen to appear at my door with a Domino’s Pizza, and for Bush to declare every Friday is “Fryday” and that pot is legal. Not one of those things is more ludicrous than this law.

Well, here’s something – not putting solutions! I have the list, and it’s full of wonderful ideas. You have any you want to share in advance of mine? Use the comments!

… to be continued!

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