How Beneficial is Widespread Medical Screening? Becker

 

 

The United States along with many other rich countries encourages widespread so-called preventive screening for various diseases, including breast, prostate, and other cancers, cardiovascular disease, diabetes, kidney functioning, and many other serious, and even not so serious, diseases. It is often claimed that prevention of diseases should be given the highest priority in order to early detect treatable serious medical problems. But these gains have to be balanced against the considerable cost of extensive preventive screening. The US and other nations are very likely over-screening for various medical problems.

The benefits of screening depend on the seriousness of the disease, and the gain from early detection. The latter in turn depend crucially on the treatment success when a disease is detected early compared to when it is detected at a later stage. For example, treatments for both prostate and breast cancers seem to be more effective when these diseases are detected early, although that is disputed by reputable researchers and physicians. However, it is clear that early detection of Alzheimer’s’ disease has little advantage since there are no effective treatments for this highly debilitating disease. Early detection of this disease may have other advantages if that enables individuals to plan for their increasing mental feebleness, such as preparing or modifying wills, and takng other decisions that require some mental acuity. On the other hand, it may reduce quality of life by causing great fear of the impending disease.

Along with the benefits often come major costs of widespread screening, costs that frequently outweigh the advantages. For example, if only a very small fraction of the population were likely to have a disease, perhaps one chance in 500 or less, it may not make much sense to screen everyone. Take, for example, Huntington’s disease, which affects a very small fraction of the population. With such a low general risk of having the genes that cause this disease, it is much more cost efficient to screen only individuals with a much higher probability of having the disease. These are persons who have family members with Huntington’s. Even then, studies show that many potential carriers of the deadly genes prefer not to be tested since no treatments are available, and they fear living with the news that they will eventually get this disease.

More generally, worry about test results is sometimes a sizable cost of widespread screening. This is partly because many medical tests frequently give false positives that may lead to unnecessary, worrisome, and sometimes risky additional tests and treatments before it is determined that nothing is really wrong. The widely used PSA test to screen for prostate cancer is a good example. Elevated or rapidly rising PSA levels are often indications of tumor in the prostate. However, many individuals have relatively high PSA levels without any tumor presence, sometimes because they have enlarged prostates. Others have rising PSA levels also for other reasons. Annual PSA tests may be indicated for men over age 45 or so with family histories of prostate cancer, but they are less frequently needed for men who have little prostate cancer in their family.

Many tests sometimes lead to serious complications, and any complications should be balanced against the gains from early detection of medical problems. Every blood test carries some risk of infection and contamination. X-rays, MRIs, CT scans, ultrasounds and the like have radiation and other risks. Probing for tumors with biopsies, colonoscopies, and other invasive tests carry a variety of risks.

The benefit-cost evaluation of any suggested widespread screening would depend on the net effect of the factors I discussed. First of all, benefits depend on the size of the gain in treatment from early detection of a disease or other medical problems. This gain has to be adjusted for the probability of finding a serious problem since the lower that probability, the less the expected gain from extensive screening. Costs start with the cost of the methods used to screen, including the value of the time and inconvenience of individuals being screened. The likelihood of various side effects from these methods also must be weighed. The fear engendered by false positives can be important, although that has to be balanced against the peace of mind that comes from getting  (true) negative results.

Preventive care is often considered the gold standard of good medical practice. It is easy to get both doctors and patients to agree when either the government (i.e., taxpayers) or insurance companies (i.e., others who are insured) pay the vast majority of the costs. A rethinking of this standard is warranted, and such a rethinking would be encouraged if individuals paid a much larger fraction of their out of pocket medical expenses.

Comments

[John Goodman]

About 80% of all preventive services do not pay for themselves. But then appendectomies don't pay for themselves either -- in the sense of reducing over all medical costs. The real test is not whether a prcedure lowers over all costs. It is whether the benefits (interms of life expectancy and quality of life) outweigh the costs.

[Brad Fallon]

The purpose is good but there are also a lot of things to consider. These series of test will cost a lot on an individual. They should determine also which test only is appropriate for an individual to prevent further expenses.

[David Welker]

Here is why I think the solution of making people pay more for preventative screening is just plain wrong.

Basically, I think it is relatively uncontroversial to say, the desirability of screening for something is unrelated to income. That is, in our society, we do not value the health of someone who is wealthy at many more multiples than someone who is wealthy.

I think that the observation that some sorts of preventative screening are "worth it" from a cost-benefit analysis and some sorts are "not worth it" is correct. But, I do not believe one can say that the health and well-being of the rich is more valuable than the health and well-being for the poor. Not unless you are some sort of sociopath. What cost-benefit analysis needs to consider overwhelmingly are the health costs and health benefits of testing; not so much the financial costs and financial benefits. For example, treatment that extends the life of a retired person is valuable even if that person is no longer contributing to society in a financial capacity.

Your proposal would simply have perverse consequences. It would stop poorer people from getting most preventative care whatsoever. People who are struggling with paying for rent or food (a situation you probably cannot relate to) are simply NOT typically going to put a high priority on preventative care, especially since the benefits are highly probabilistic and therefore uncertain. Are you really going to not get your kids Christmas presents so you can go get some medical test that probably will come back negative anyway? Unless you have ever been faced with those sorts of financial constraints, I don't think you can really understand the lack of sensibility of your proposal. At least if you, like me, value the health of the poor equally.

Here is how this problem of cost-benefit analysis really has to be handled. First, the costs and benefits of various screening protocols should be evaluated by experts who consider health consequences (but not financial consequences) in an initial stage. Such evaluations should certainly take into account whether or not a positive diagnoses would lead to beneficial treatment. Some sort of ranking should occur, giving value to both extension of life and lessening of suffering while also taking into account any risks from treatment as well as increases in suffering. Only after we determine the health costs and health benefits, should we even think of the financial costs and the financial benefits. This should seem fairly sensible; a hypothetical consumer who was not resource constrained but insisted on getting the best deal possible would want to know what they are buying. Then, for all screening that clearly and convincingly meets a health cost/benefit test and where such screening and subsequent treatment can be provided at reasonable, such screening should be provided to the poor and lower middle cost at absolutely no cost whatsoever.

What we would get in your alternative world is a lot of people neglecting highly beneficial screening for financial reasons. And that simply is not morally acceptable. Not if you believe that financially constrained people have equal dignity. Medical care is not like other goods, such as luxury vehicles or name brand clothing, where when a poor person does not have access to such goods, it is not a moral crisis. A failure to screen a financially constrained person for a disease where screening for that disease is clearly and convincingly highly beneficial from the standpoint of health and where they can be screened and treated at a reasonable cost to society is a moral tragedy the first order. Yet, this is apparently the sort of unacceptable moral tragedy that your proposal would inflict.

[Speed]

Individuals can pay the costs of screening and treatment and decide what is worthwhile and important to them. Alternatively they can let someone else (government, insurance company) pay the costs and make the decision for them.

In a free market for insurance, providers would compete based on both price and included diagnostic and treatment coverage.

[Discount Coach Handbags]

The tragedy of life is not so much what men suffer, but what they miss.

[Jack]

Ha! Would that our trillion buck a year military budget subject to such "cost-benefit" analysis!

If our medical care dollars are so scarce, why are we paying three to five times what the Japanese pay for checkups and screenings?

http://webcache.googleusercontent.com/search?q=cache:ulusvHbMfWAJ:www.checkupjapan.com/price-compare.php+cost+of+cat+scan+US+Japan&cd=1&hl=en&ct=clnk&gl=us&source=www.google.com

And, why are we not SERIOUSLY looking for cost compression in our long delayed H/C reform efforts?

Tallying up those working for governments at all levels, the military, the VA, Medicare, and perhaps SS disability, we taxpayers are already sharing much of the H/C burden. Yet more costs are distributed to all by the (insane!) system of those "uncovered" showing up half dead to further overcrowd Emergency Rooms across the nation for the most expensive H/C on the face of the Earth.

"Paying more" as a (crude) means of rationing preventative care and screening (a system of negligible restraint to the well off and prohibitive to those for whom any additional impacts to their strained budgets would be prohibitive) strikes me as cruel and inhumane as well as foolish. Wouldn't an economist lean more toward a system that provided incentives for the most productive of life enhancing and perhaps cost saving screenings that many ignore, with manageable "penalties" only for those well out on the the wasteful end of the "cost-benefit" curve?

And a caveat? Would the act of the patient turning down a diagnostic test for being "too costly" be a bulwark against a malpractice suit? Suppose the "cost prohibitive" test was well indicated, then what?

Who is to decide where the "cost benefit" equation "balances?" Let's hope it's not the thin wallets of those whose incomes did not rise with the doubling of productivity over these last few decades.

[Danny DeMichele Entrepreneur]

I don't think you can really understand the lack of sensibility of your proposal. At least if you, like me, value the health of the poor equally.

[Danny DeMichele Entrepreneur]

This should seem fairly sensible; a hypothetical consumer who was not resource constrained but insisted on getting the best deal possible would want to know what they are buying.

[Xavier]

David Welker,

I read Prof. Becker’s suggestion differently. I read him as being concerned about how government can deal better with the free rider effect. I gather you are a lawyer or know law so surely you are well read and also know about this effect and how very pernicious are its consequences.

Prof. Becker suggests that one way of dealing with free riders, and more generally the abuse of preventive medicine, including by doctors, is to increase the price to the end user from zero, where it is currently at for most insured people, to something reasonable.

Just for the record, in my company, where we have what most employees consider a very generous medical plan, we—I sit on an oversight committee—have estimated that the overall cost of medicine to our average family is in the neighborhood of $16,000 to $18,000 per year. Our plan aims at covering 60 percent of that. Yet with some amazement we read and hear from the media that so-called Cadillac plans can run as high as $24,000. Worse, the Administration seemingly intervened to give those plans even better breaks with the new law. We wonder how and on what anyone can spend so much. We know there is some free riding in our own plan, but so many thousands more in other companies?

How would you deal with the free rider effect?

[Jack]

Xavier: Your question reminds me of a Senate cmte discussion some years back. One topic was that of Taco Bell (then owned by Pepsi) having no H/C benefits while Pepsi drivers and employees did have good benefits.

One senator mentioned that in his state there were likely families where one member worked for Ford, while another worked at Taco Bell or similar. "Why" he asked "should Ford be paying for the H/C of the Taco Bell employee?" Why indeed, and surely where your company has some free riders.

To solve the free rider problem, I like to zoom out for a better perspective. Consider all those who are in one risk pool or another today, including virtually all government employees from local to federal, military, most who work for our larger corporations, and.......... those actually on welfare or in prison.

Who is left out? Mostly it's the employees of those struggling "small businesses" that we give lip service to as our "job incubators", fast food and other low paid service sector employees, and (curiously) those of Walmart, one of the richest companies ever to exist in the world.

Perhaps that number is close to the 50 million often used. Now say we accorded all of the costs of determining who "is covered", insurance company overhead and the other "uncovered" costs of ER over usage to "making sure those 50 million don't get something they've not paid for".

The per excludee figure would be enormous from that of the 11 medical clerks used in the US as compared to one used in Canada, to the costs associated with lack of routine care, to overuse of the ER and so on.

And philosophically the truth is we in America are NOT, in the end exclude anyone. Which means that by one means or another we're ALL in the H/C pool with the question simply being that of how do we do that task more efficiently than is the case today. As we spend twice what the other nations spend, arguably we're picked the worst of all of them. Surely if one nation has a "waiting line" at half what we spend, we should be able to cover all with no "waiting line"

Well, a huge transition to make, and not easy in a pure environment and our insurance parasites are making damm sure no such purity will exist.

[Xavier]

Jack, you neatly avoided my question to David Welker. Do you really know what free riders and free riding are? If you do you'll know that they contribute substantially to increasing the cost of medicine in the US as compared to other countries—and there are two other drivers I'll come to below. As to the uninsured, did you miss my point about safety nets? Nobody questions the need to solve that problem.

But back to free riders, I still don’t understand how you would deal with them. For starters, how do you explain the huge per family cost range between companies like mine and the Cadillac plans? I reviewed my figures again and Cadillac plan families spend about 50 percent more than families in my company and, as I said, we consider our plan very generous. That alone is a monstrous cost driver.

Now, the other two major cost drivers are the defensive medicine practiced by doctors afraid of law suits, and the very highly subsidized nature of medicine in other countries. The effect of law suits is well understood. As to the subsidies provided by other countries to their people, guess who pays for many of them: the US, yes, the US, you and me. Take the example of price controlled drugs in Canada. Because they earn less in Canada, drug companies that pay some one billion to launch each new wonder drug have to charge their American clients more to cover those costs. And there are many other examples, like, for instance, MRIs in Japan.

Demonizing the drug and insurance companies is not going to solve our problems. The return on invested capital of both groups of companies is fairly on par with what investors expect, including the many millions of small investors who depend on those profits and return on capital for their retirement.

If you still consider those profits excessive then open the field to more competition. Believe me, that works far better than government regulation and rationing (and surely you understand that all, repeat, all services and products are rationed, either by the market or by bureaucrats). For many years I was a very senior executive in the private sector and trust me, we much preferred government regulation than competition. For large investors the former is predictable and manageable. Competition can kill you.

By the way, are you aware that in your reply to my comment to Posner’s blog, where you say “that once we get the model right…large organizations will replace the ‘Mom and Pop’ medical providers able to send out their own inflated invoices and carry the high (per patient) overhead...” you are in effect accepting large private medical conglomerates as the solution to our healthcare problems? Did you see the talk by Prof. Cutler on C-Span, for which I provided a link, where he wants the government to give incentives to help create billionaires as part of the solution? Are you really okay with that, particularly given that you consider the current large companies to be “parasites?”

[Xavier]

Jack, one other point that maybe I missed. You and I may be talking about two entirely different issues and therefore talking past each other. I made a quick reference to it in my comment above but then went my merry way. You are concerned about the injustices of the present system, particularly the many millions that are uninsured. I am concerned about how to bring the cost of healthcare down. The point about injustices is so obvious that I grant it without discussion.

I hope you realize how the politicians have been using us by failing to make that distinction clear and addressing the points separately. In fact, they mix the two on purpose. Confusing the two has tied up the opposition to the healthcare law in knots and left the field clear to the politicians advocating the new law. Our dialogue is a good example. I hope we can both get smarter. I have absolutely no quarrel with dealing with the injustices of the current system.

My problem is with HOW the new healthcare law proposes to reduce the cost of healthcare. They want to do it through government regulation. That is rationing pure and simple. If there is to be rationing, and there always is for scarce goods, I much prefer to do it myself in the market through personal choice. For more see my reply to you in the Posner blog. And remember, that is entirely different from providing medical services to those that don’t have them today. So let’s both get smart about what we argue and stop talking past each other.

[Jack]

Xavier, Thanks! Good comments, questions and suggestions. As in your last we may be passing as ships in the night. Let's take a look: (Oh, and please read my last on the Posner side.)

Jack, you neatly avoided my question to David Welker. Do you really know what free riders and free riding are? If you do you'll know that they contribute substantially to increasing the cost of medicine in the US as compared to other countries—and there are two other drivers I'll come to below. As to the uninsured, did you miss my point about safety nets? Nobody questions the need to solve that problem.

A: Ha! "free riders" brings up the image of the old film "Easy Rider" and we're nearly sure that many young and invincible motorcycle rider bikers would spurn paying H/C premiums along with extreme skiers and a host of others. Sooooooooo, isn't the "problem" much like auto liability? Even if out their in a clunker one can still kill someone or destroy a Mercedes, so all must be in the pool.

But back to free riders, I still don’t understand how you would deal with them. For starters, how do you explain the huge per family cost range between companies like mine and the Cadillac plans? I reviewed my figures again and Cadillac plan families spend about 50 percent more than families in my company and, as I said, we consider our plan very generous. That alone is a monstrous cost driver.

A: You're likely more familiar with the details today, but while I, as a sole proprietor can only deduct half of H/C premiums corporations can deduct the whole works. Great, eh? A Caddy that's fully deductible to the employer and is not a tax event for the recipient. As for free-riders, they don't exist in nations having universal coverage.

Now, the other two major cost drivers are the defensive medicine practiced by doctors afraid of law suits, and the very highly subsidized nature of medicine in other countries. The effect of law suits is well understood. As to the subsidies provided by other countries to their people, guess who pays for many of them: the US, yes, the US, you and me. Take the example of price controlled drugs in Canada. Because they earn less in Canada, drug companies that pay some one billion to launch each new wonder drug have to charge their American clients more to cover those costs. And there are many other examples, like, for instance, MRIs in Japan.

A: Well, what IS going on here? Some strange exemption from "globalism?" In which the Bush Medicare Drug program pays the rack rate for drugs made in our country, sans even competitive bidding? While the same company exports our drugs to Canada at prices where their pharmacist can make money selling 'em back to us at half price? But it's illegal for us to do so? The VA which is "allowed" to shop, pays about half the price Medicare D and insurance companies pay. Surely, if pricing pressures were put on Big Pharma here........... they would HAVE to spread their research and even larger advertising costs across all nations? Why should WE pay twice what England pays for OUR drugs??

Demonizing the drug and insurance companies is not going to solve our problems. The return on invested capital of both groups of companies is fairly on par with what investors expect, including the many millions of small investors who depend on those profits and return on capital for their retirement.

A: Well to be frank Pharma returns top most other sector's returns...... but again, one does wonder why they'd sell more or less at cost to all but the US??????

If you still consider those profits excessive then open the field to more competition. Believe me, that works far better than government regulation and rationing (and surely you understand that all, repeat, all services and products are rationed, either by the market or by bureaucrats). For many years I was a very senior executive in the private sector and trust me, we much preferred government regulation than competition. For large investors the former is predictable and manageable. Competition can kill you.

A: Ha! you're an honest man! Indeed! while venerating "free competition" to the status of the gods, we then go to work (or to Congress?) seeking "an edge" or means NOT to be subject to the vicious competition that drives down the price of commodities and generic labor below production costs. As for "scarce resources" it's true, however, in some of Clinton's post Pres endeavors, they've found that by scaling up to provide millions of Africans cheap drugs, they've increased profits in the developed nations. Many drugs, like the new Intel chip, may have billions in sunk costs that are pennies if spread wide enough.

By the way, are you aware that in your reply to my comment to Posner’s blog, where you say “that once we get the model right…large organizations will replace the ‘Mom and Pop’ medical providers able to send out their own inflated invoices and carry the high (per patient) overhead...” you are in effect accepting large private medical conglomerates as the solution to our healthcare problems? Did you see the talk by Prof. Cutler on C-Span, for which I provided a link, where he wants the government to give incentives to help create billionaires as part of the solution? Are you really okay with that, particularly given that you consider the current large companies to be “parasites?”

A: First the terminology. In the ocean parasites are parasites, that's their gig. That IS basically a what medical insurance are. For the most part they ADD costly, non-std paperwork and cream off, not what they admit to netting, but their entire gross from the H/C payment system.

As for size of provider, I'm certain that there are inherent advantages to scale that is larger than what we are used to today. I'm not sure how large they need to be and it may well depend on what sort of system we end up with. IF, say it's a "single payer" I see no reason that provider groups could not compete as they do today when payment is clumsily derived from a host of disparate insurance parasites. IF today's "insurance" outfits do want to play in this arena, armed with lots of capital and large subscriber bases they are well positioned to enter the provider business, either as hospitals or groups of GP's and specialists. IF we are serious about cost containment I do not see a role for them as parasites.

Posted by: Xavier | 03/01/2011 at 09:30 PM
Xavier

Jack, one other point that maybe I missed. You and I may be talking about two entirely different issues and therefore talking past each other. I made a quick reference to it in my comment above but then went my merry way. You are concerned about the injustices of the present system, particularly the many millions that are uninsured. I am concerned about how to bring the cost of healthcare down. The point about injustices is so obvious that I grant it without discussion.

A; Yeah, and to get at the injustice we really do need to bring med inflation in line with inflation in general, otherwise 17% of GDP soon becomes 20% and we're then that much less competitive than say Germany that is at 11%.

I hope you realize how the politicians have been using us by failing to make that distinction clear and addressing the points separately. In fact, they mix the two on purpose. Confusing the two has tied up the opposition to the healthcare law in knots and left the field clear to the politicians advocating the new law. Our dialogue is a good example. I hope we can both get smarter. I have absolutely no quarrel with dealing with the injustices of the current system.

A: The rhetoric is horrible! A kid growing up today is likely to ask "What it the "jobkillingobamacare?" I keep trying to cut today's version of Repubs and teapartiers some slack, but they make it a hopeless case. Even as income and wealth consolidates in the top few percent they find it just? to continue what was an unaffordable tax cut for the wealthiest among us in 2000 that cost's our empty Treasury $50 billion/year or more, that they hope to claw back by cutting programs benefitting those left behind as the tide rose only for the gilded yachts.

My problem is with HOW the new healthcare law proposes to reduce the cost of healthcare. They want to do it through government regulation.

A: Oh? Some of it is being done as we speak in busting Medicare defrauders.

That is rationing pure and simple. If there is to be rationing, and there always is for scarce goods, I much prefer to do it myself in the market through personal choice.

A: I don't think you'll have to worry. My guess is that any system we devise will have such an out. Were the "public option" retained.. that I suspect would have helped to constrain costs, it may well have become the "Medicare for working folks" while others, or their employers, could pay more for the Caddies.

For more see my reply to you in the Posner blog. And remember, that is entirely different from providing medical services to those that don’t have them today. So let’s both get smart about what we argue and stop talking past each other.

A: American politics work in curious ways, we often try to "write a bill" sans agreeing on the phil. Summed up, I'd say American overwhelmingly are opposed to letting folks die in the streets w/o H/C whether rich, poor or illegal worker. It's high time that we accepted that and went about providing, efficiently, for all, rather than wasting our scarce dollars on sorting out who is "eligible" and shooing the rest off to the ER for the most costly and inefficient care in the developed world.

Posted by: Xavier | 03/01/2011 at 09:50 PM

[Trent Jordan Vancouver]

Today cancers and many other such serious life taking diseases have increased.. Medical Screening will prove very much beneficial in this case...The benefits of screening depend on the seriousness of the disease, and the gain from early detection....the more earlier a disease if detected its cure becomes more easy..

[Xavier]

Jack, all I can say is cheer up and don't trust government too much.

[Jack]

Xavier: Thanks, and when "government" is working properly it's ................. us! Should one instead "trust" corporations and medical "insurance/pre-payment" companies that have no place in the H/C systems of the civilized nations that spend about half what we spend, and where bankruptcy due to medical bills (Number one in our strange system)?? Does the one selected by your employer open to inputs from you and fellow employees who pay their considerable costs?

[Cadillac allante parts]

This should seem fairly sensible; a hypothetical consumer who was not resource constrained but insisted on getting the best deal possible would want to know what they are buying.Thanks

[Xavier]

Jack, before you react to this comment please look at my earlier one in Posner’s blog. I don’t have much to add except that you may be far too biased against private corporations. I too don’t like them when they get too big and would have government cut them down to size and have them compete even more than many do today. And that includes insurance companies which I would have compete across state lines. In fact, I smell a rat in the process that led to the law that eventually got approved. Why doesn’t the new law include competition across state lines? Did the large insurance conglomerates get to the Administration? As I pointed out a couple of days ago, the new law even encourages still larger conglomerates.

But having said that, I still much prefer private solutions. I would add a large dose of values, which, as I said in my entry in the other blog, I very much don't want government providing. In fact, unless we can somehow restore traditional good values I am pessimistic for the future of the country. Let’s start with toleration and compromise. Moreover, as I also point out in the other blog, I am more than aware that government is us. Yet I am also deeply aware of Madison’s warnings (was it in Federalist 10?) about excessive concentrations of power and the high-jacking of the government by a majority. As I mentioned, I’ve been reading history and the outcome of such concentrations has always been the same: the eventual downfall of the society, without exception.

As to the high cost of medicine in the US, please look at the three reasons I mentioned in an earlier comment—free riders, defensive medicine, subsidies across countries. There are more reasons but those three alone account for a very large part of the differences across countries. And then there is the fact that in other countries governments, rather than markets, ration medical services. It is far easier to control costs when you can decree outright what can and can’t be bought.

Finally, I hope that when raising the question of whether “Does the one selected by your employer open to inputs from you and fellow employees who pay their considerable costs” you are not further pounding the drum against corporations, large and small (excessive predisposition against something or somebody tends to be blinding and results in missed opportunities). In fact, my membership in an oversight committee is as a user, and, yes, my company, it is actually my ex-company since I am now retired, does listen to us.

And if that doesn’t convince you, the company has no contractual obligation to continue providing retirees medical insurance other than a broad unwritten understanding about the general terms of original employment. Yet in spite of this we are in the middle of negotiations that could result in their actually having to increase their contributions to the plan. On our side we continuously make suggestions on how to further control costs, including measures to reduce the free rider effect. There are many people and companies with high standards left. That is why despite the pessimism I express above I did suggest in an early entry that you look at the positives and cheer up!

[Jack]

Xavier: ......... Well........ it's not all bumpersticker or "values" simple:

Jack, before you react to this comment please look at my earlier one in Posner’s blog. I don’t have much to add except that you may be far too biased against private corporations.

J: Nah, as you indicate below most of my comments relate to the playing field upon which they compete. As you suspect once one football team is allowed outside the boundaries, or the use of a bulldozer, the game is no longer football.

I too don’t like them when they get too big and would have government cut them down to size and have them compete even more than many do today.

J: Well, bankster lobbyists beat you to death on that one! When Ex Senator ("investment banking thief) Phil Gramm slipped through the repeal of Glass-Steagal much of the leverage employed was that of our banks (haha) being too small and hamstrung to "compete" in the global market place. Ummm, yeah.

And that includes insurance companies which I would have compete across state lines.

J: Well, more complexity. See EACH state has a host of laws attempting to limit the greedy wolves from eating the entire flock of sheep at once... thus killing the golden goose for all. Now what happened when the banksters got their wish to "compete" across state lines? Most set up their predatory credit card scams in the states of LEAST consumer protections. You've surely heard of some of the egregious examples of sticking it to the unwary customers via multi-page fine print "contracts" that vary tremendously. Europe? gets by with a far simpler CC contract, simple to read and somewhat standardized.

In fact, I smell a rat in the process that led to the law that eventually got approved. Why doesn’t the new law include competition across state lines? Did the large insurance conglomerates get to the Administration? As I pointed out a couple of days ago, the new law even encourages still larger conglomerates.

J: Well, I can tell you what happened when banksters were allowed to expand across state lines. First was a regional consolidation with your local banker getting gobbled up by a regional behemoth that itself was trying to carve off a piece as BA, Wells and a few other ran their bank harvesters from coast to coast. As you likely know, the end of G-S allowed banking, insurance, and stock brokerages to conspire under one roof. Naturally "competition" is NOT the reason BA gobbled up M. Lynch.

But having said that, I still much prefer private solutions.

J: W/O specifying how........... in the matter of H/C being discussed, we'd have to dismiss that generic preference as ideology. As a practical matter......... there are NO "private" solutions to solve the problem of soaring H/C costs for those much below median incomes -- basically half of our population.

I would add a large dose of values, which, as I said in my entry in the other blog, I very much don't want government providing. In fact, unless we can somehow restore traditional good values I am pessimistic for the future of the country. Let’s start with toleration and compromise.

J: "Values" eh? "Large doses?" From where? How administered? To what end?

Moreover, as I also point out in the other blog, I am more than aware that government is us. Yet I am also deeply aware of Madison’s warnings (was it in Federalist 10?) about excessive concentrations of power and the high-jacking of the government by a majority. As I mentioned, I’ve been reading history and the outcome of such concentrations has always been the same: the eventual downfall of the society, without exception.

J: Hmmmm, well, in the post WWII era there are basically three things that have increased the cost and size of government as a percentage of GDP.

A. The 20 years of experimentation (largely during Repub administrations and with FEW vetoes) of spending much more than we collect in revenue which is adding a "new bill" of an annual cost eclipsed only by our burgeoning military "budget".

B. That our nation has taken on a role as "world policeman" with some 725 costly bases around the world and a military budget nearly that of all the other nations combined. A role NO founder could have possibly considered.

C. FAR more complexity! The founders had not even a vision of universal education, much less that the feds would have to step in and subsidize those states that could not or would not adequately fund their commitment to universal education. The founders could never has foreseen even a costly federal highway system, much less the need for the EPA or bodies regulating and overseeing mining and drilling activities or the FAA or any of a host of other governmental agencies. I'd posit that we'll HAVE to allocate a higher percentage to government functions going forth, than we did in the post WWII era........ and ESPECIALLY so after clawing our way out of this MESS.

As to the high cost of medicine in the US, please look at the three reasons I mentioned in an earlier comment—free riders, defensive medicine, subsidies across countries.

J: I answered each of those quite thoroughly and am not sure why you are presenting them again.

There are more reasons but those three alone account for a very large part of the differences across countries.

J: Answered before........ but do we have here a "free-marketer" making excuses for Big Pharma selling at more than half what WE Americans pay to other nations? Please explain.

And then there is the fact that in other countries governments, rather than markets, ration medical services. It is far easier to control costs when you can decree outright what can and can’t be bought.

J: Sorry, No sale. Many consider France one of the best places to "get sick". Germany is on par with the US but spends 11% of GDP to our 17% and rapidly growing. For what we spend we should have either a Caddy or Mercedes level of coverage. For ALL.

Finally, I hope that when raising the question of whether “Does the one selected by your employer open to inputs from you and fellow employees who pay their considerable costs” you are not further pounding the drum against corporations, large and small (excessive predisposition against something or somebody tends to be blinding and results in missed opportunities). In fact, my membership in an oversight committee is as a user, and, yes, my company, it is actually my ex-company since I am now retired, does listen to us.

J: Interesting. In Medicare, Aid, SS and indeed the entire government there are no salaries higher than the $400k earned by the President..................... what are the top salaries of your H/C insurance people? And why is such justified on the backs of you and your fellow employees?

And if that doesn’t convince you, the company has no contractual obligation to continue providing retirees medical insurance other than a broad unwritten understanding about the general terms of original employment. Yet in spite of this we are in the middle of negotiations that could result in their actually having to increase their contributions to the plan. On our side we continuously make suggestions on how to further control costs, including measures to reduce the free rider effect.

J: Indeed! In my patient explanation of Taco Bell and Walmart serfs being "free-riders" I urged you to consider why some companies bear the H/C costs of those plying their crafts at other less responsible firms? Aren't the battles you guys were fighting kind of a warning that the whole mess IS crumbling and is unsustainable?

There are many people and companies with high standards left. That is why despite the pessimism I express above I did suggest in an early entry that you look at the positives and cheer up!

J: Not to worry! In your reading of the founders (other than their miserable lapse on enslavement and women and bias toward the landed gentry) don't you detect the noble aspirations of their trying to design a liberty for all and NOT dramatically tilted toward the privileged? Something that recent actions by the former "GOP" would indicate they've long forgotten?

[AppraiserNow.com]

Well Are you really okay with that, particularly given that you consider the current large companies to be “parasites?”

[new era hats]

The statement about prostate cancers is not quite accurate. Benign prostate enlargement is not thrown up by the PSA screening. The PSA test often finds cancers that are malignant but which are not likely to kill the person - he will die of something else first. The problem is that there are no accurate ways of telling the difference between malignant cancers that can be left alone and those that will kill.
But the point that screening often leads to unnecessary treatment is correct.Judge Posner does an excellent job of identifying most of the key variables that have to be weighed in the preventive care dimension of healthcare. I wish he would have also identified the relevant variables that should be considered in a debate of the best method of rationing, and weighed their pros and cons. The broad choices are: let markets ration or have bureaucrats do the job, whether in government or large private sector companies or both.

[Gaston Cantens]

I don't think you can really understand the lack of sensibility of your proposal. At least if you, like me, value the health of the poor equally.

[cheap red bull hats]

le of negotiations that could result in their actually having to increase their contributions to the plan. On our side we continuously make suggestions on how to further control costs, including measures to reduce the free rider effect.

J: Indeed! In my patient explanation of Taco Bell and Walmart serfs being "free-riders" I urged you to consider why some companies bear the H/C costs of those plying their crafts at other less responsible firms? Aren't the battles you guys were fighting kind of a warning that the whole mess IS crumbling and is unsustainable?

[air jordans]

At some point it all becomes an embarrassment to the professional status of those economists who tell us that Krugman is a good economists .

[Pepe Fanjul]

I wish he would have also identified the relevant variables that should be considered in a debate of the best method of rationing, and weighed their pros and cons.