The New Yorker
by Hendrik Hertzberg
Issue of 2006-04-17 | Posted 2006-04-10
Perhaps you have been wondering who or what is to blame for the high cost of medical care in this land of ours – and, more broadly, for the ungainly, unjust mess that is the American health-care system. If so, wonder no more. Your government has fingered the culprit: it’s “the vast majority of Americans.”
The perp having been collared, the trial held, and the verdict rendered, only the sentencing phase remains. Providentially, our leaders have come up with a punishment that fits the crime. We, the guilty, are to be condemned – or invited, but in any case for the rest of our natural lives, without possibility of parole – to turn over our bodily well-being to “consumer-directed Health Savings Accounts” in conjunction with “high-deductible health policies.”
This judgment was handed down last Monday, in the form of an article on the Op-Ed page of the Times. The piece was no Dowdy jestfest or Friedmanesque memo-to-the-mullahs, and not only because of the dreariness of its style and the banality of its content. Its author, Allan B. Hubbard, identified as “assistant to the president for economic policy and director of the National Economic Council,” has lately emerged as the White House point man on health policy, and, in subsequent days, his Op-Ed proved to have been the overture to a veritable symphony of spin conducted by President Bush himself, including an Air Force One ride to Bridgeport, Connecticut, for a stagy “Panel on Health Savings Accounts.”
Hubbard’s article, headlined “The Health of a Nation,” begins with a frank-sounding acknowledgment that “in the past five years” – that is, since the present Administration took office – “private health insurance premiums have risen 73 percent,” with the result that “some businesses” have dropped coverage altogether. “What is driving this unsustainable run-up in health insurance costs,” Hubbard asks, “and how can we make things better?” Then comes what bloggers call the money quote:
Health care is expensive because the vast majority of Americans consume it as if it were free. Health insurance policies with low deductibles insulate people from the cost of the medical care they use – so much so that they often do not even ask for prices.
Can this really be the Administration’s view of the health-care crisis? That its root cause is that Americans are (a) malingerers and (b) freeloaders who perversely refuse to go comparison shopping when illness strikes? That wefre overinsured? Hard as it is to believe that this is what they say, it’s even harder to believe that this is what they believe.
Health care is indeed expensive, but not because people are too quick to call the doctor when they experience a scary symptom or merely an annoying one, and not because some of them may bridle at entrusting their health to the lowest bidder. Throughout the Western world, health care is expensive, first of all, because it is expensive, and is bound to get more so as populations age and medical technology advances. Indeed, it should get more expensive, both in absolute terms and as a proportion of national income, because what it aims to provide – healing, the relief of suffering, the staving off of death – is of such inestimable value.
American health care is the most expensive on earth, but this, too, has little to do with overindulgence in seeking medical attention. (Overindulgence in cheeseburgers is another matter.) It has a lot to do with the waste built into what Paul Krugman calls our crazy-quilt health-care system, which has a lot to do with the fact that so much of that system is private rather than public, which in turn has a lot to do with two other factors. One is historical: during the Second World War, industry (with prodding from organized labor) got around wage controls by offering workers health benefits in place of cash, thus saddling the United States with “employer-based” private health insurance – a system now in slow-motion collapse under the competitive pressures of globalization. The other is institutional: even though there has long been popular support here for universal, government-run health care, as there is in Europe and Canada, America’s fragmented political system – riddled with weak points where well-organized, well-financed minorities can thwart the unfocussed will of a majority – has been able to deliver only for seniors and, less generously, for the poor.
Medicare – a mixed system, under which the insurance function is socialized while the care itself remains in private hands – dedicates two per cent of its resources to administration. By contrast, the private health-insurance industry spends a fortune – more than ten per cent of its income – on administrative dreadnoughts devoted largely to vetoing treatments, sloughing off sick or potentially sick clients, and scheming to stick someone else with the bill. In the United States, we spend fifteen per cent of our gross domestic product on health care, close to six thousand dollars per person. The French and the Canadians spend ten per cent of G.D.P., about three thousand dollars per head. Yet their “health outcomes,” measured by indices like longevity, are better than ours. If they spent the kind of money we do, they’d live forever.
Hubbard – who, by the way, is a finalist to be Bush’s next Secretary of the Treasury – is an initiate of the cult of the market, which he evidently regards as the fundamental model for all human relations. For him, sick people who require care are “consumers.” That word and its derivatives appear ten times in the eight hundred and fifty words of his Times piece. (“Patient” appears once. “Sick,” “ill,” and “under the weather” do not appear at all.) Accordingly, the solution that he and Bush are pushing – so-called health savings accounts – puts the onus on “consumers” to fend for themselves in the medical gmarketplace.h Itfs probably unnecessary to add that this solution would solve nothing. It would be yet another gift to people in the higher tax brackets, would undermine traditional insurance by pulling young and healthy people out of risk pools, and, with a fine evenhandedness, would discourage people from going to the doctor for real and imaginary illnesses alike. This is a worthy follow-up to the Administration’s prescription-drug program for seniors, another excrescence of market cultism. The elderly had hoped for a straightforward benefit that would have allowed them to acquire, at some affordable price, the medicines their doctors prescribed. What they got was a parody of “choice,” sadistic in its complexity, which forces them or their children or caretakers to game out which of dozens of private “plans” might give them access both to the medicines they need now and the ones they might unpredictably need in the future. The solicitude their government might have bestowed on them was reserved instead for the insurance and pharmaceutical industries. The Administrationfs message to the old and sick is the same as its message to the country after the September 11th attacks: Go shopping. Well, caveat emptor.