POLICY/INTERNATIONAL: A European conservative complains, but groks the problem

This is pretty interesting. Paul Belien, a Belgian conservative is complaining about governments in Europe cutting spending on health care, with the results that more expensive technologies are withheld from the elderly (like his 90 year old uncle).  He thinks the answer is to move towards building reserves for the future, and he’s probably is in the individual HSA crowd (although theoretically these could be pooled reserves). But that’s not the interesting thing.

The interesting thing is that he understands the equation. If we spend more on health care, we spend less on other things, and that there’s a choice between these positions. Given that, he has what he considers to be a solutions. Here’s his conclusion.

At the root of these decisions is the understandable desire of governments to control health-care costs. But rationing is clearly not the answer. What many governments in Western Europe have overlooked is that there is nothing wrong with a society devoting more of its resources to health care. This even appears to be an indication of prosperity. The higher and the more developed a society becomes, the more its citizens are willing to spend on keeping healthy. Modern technology makes everything cheaper except the highest quality of medical care, which is constantly improving. To try to limit access to this technology in the name of “cost-control” is irresponsible.

Meanwhile, the larger and more fundamental problem of how to finance the health-care systems is not adressed. Instead of funding the provisions of today’s sick with taxes from today’s healthy and young, people should be building up reserves for their own future liabilities. What Europe needs is to replace its pay-as-you-go systems by privatized and capitalized health-care systems. This, however, would imply that the governments relinquish control over the system, which is the very last thing they are willing to do.

Now I disagree with him about who should ultimately control health care, because I think it’s more of a public good than he does, but at least we are starting on the same page—one that I went over at length in my “Health care = Communism + Frappuchinos” article, which is well worth another read. The issue is that some care is basic and some care is a luxury good bought on the margins. You’ll note that he never says directly that people should be forced to pay for all their own health care with no cross-subsidiaztion. Of course that is where the US has been heading, and why our poor and unisured are literally dying (albeit not) in the streets.

Would it that we could have this rational argument with most conservatives (and even several liberals) in this country. Instead we get the Cato guys missing the point by trying to get us to worry about the almost incidental spending on the healthy, and Ron being Ron. No one wants to talk about whether or not we should be paying for the more expensive stuff for the 90 year old uncle, and that’s the real debate.

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3 replies »

  1. Absolutely!!! The problems experience by providers servicing Medicaid is a glimpse of what will happen under a rush to national health care. Providers take a beating under Medicaid price controls. It’s outrageous.
    A fair share of the uninsured are people actually eligible for Medicaid programs but you will not see aggressive outreach programs by States to enroll these individuals because it simply costs more money. I simply do not trust government to be the ultimate decision maker for health care.

  2. There is another group in the US subsidizing healthcare to the poor. Physicians, Hospitals and other healthcare providers who see Medicaid patients often do so at less than ‘break even’ reimbursement. Healthcare is the only business where the supplier is expected to subsidze the poor. If the indigent go to the grocery store without money, the grocer does not routinely fill the shopping cart of give a discount; the poor person goes home hungry. Healthcare providers see this as part of their obligation to ‘give back to the community’. However, it’s important that we all recognize that when the government cuts Medicaid reimbursment they are also asking (demanding) that healthcare providers give a little more.

  3. There are two government run health care programs in this country, Medicare and Medicaid. And both of them face the same problems as the private sector, including increasing costs and lack of universal coverage. Medicare and Medicaid use price controls like other countries with national health care yet their costs are still a huge burden to the government (in Florida almost 25% of the budget is for Medicaid & SCHIP programs) and still fail to provide coverage to all of the eligibles.
    Therefore, you will never convince me that rush a to an expanded government role in health care is the answer.