Disciple Test Blog

Lies and health care

2009-02-13T18:25:50Z

Dana Blankenhorn on the "two big lies in health IT debate:"

Groups devoted to finding cures for dread diseases, like the American Cancer Society, rightly fear that evidence-based medicine will eliminate payments on unapproved therapies.

Insurers, who have their own profits on the line, are less susceptible to the political pressure of these groups. Violations of evidence-based guidelines are pressure on their pockets.

The big lie being told on the proponents' side is that no one is going to be hurt by reform. McCaughey gave this away in her now-infamous column, as published by Bloomberg, writing "the bill treats health care the way European governments do: as a cost problem instead of a growth industry."

One man's higher payment is another's higher profit.

Free market advocates often fail to grasp that certain industries (and in some cases, "industries" as is the case with the legal profession) are mostly net drains on the economy. Health care is one of them, as it produces minimal wealth. Most of it is just a cost of keeping society health and productive, and treating that as a "growth industry" is like saying that we should celebrate the steadily increasing revenues of arms manufacturers in a time of global war. There is nothing innately wrong with either industry, and both serve an essential purpose, but usually when they consume an increasing amount of the GDP, there is an underlying problem that must be addressed. So, the European perspective is correct, but their solutions are usually not.

A significant part of the opposition to EBM comes from the way that the government actually behaves on similar issues. As I previously mentioned, the federal government already makes its own decisions about narcotics based on scientific evidence that is flimsy at best. That is problematic for EBM advocates because there is no bright line between licit painkillers and illicit drugs, since most prescription painkillers are chemically related to narcotics. The federal government's political needs in the War on Drugs frequently threaten to or actually do spill over into doctors' offices over this issue, and the DEA is supremely self-confident about its ability to decide for doctors how many painkillers long-term pain patients need.

So really, the federal government has a poor track record of showing that it can put science above politics. It's done nothing to inspire confidence in the minds of skeptics who have history on their side when they predict scenarios ranging from government bureaucrats arbitrarily stopping some treatments and drugs, to law enforcement stepping in and creating a huge mess.

In Europe or Canada, the payer takes control of product at the wholesale level. They buy in bulk and handle the distribution.

In the U.S. the producer controls the product down to the retail shelf, except in the case of sales to hospitals or, say, the VA, which have the buying power to "break bulk" themselves.

This control of the channel has a huge impact on the bottom line, even for patented medicines. It means the producer here dictates the price. Buyers have no leverage.

If this control is lost, if the subsidies to industry end, America could lose thousands of jobs, and some companies could go bankrupt. That is an economic hit we need to remind ourselves of.

This is problematic on another level. It's no coincidence that pharmaceuticals and other health care product producers tend to be based in one of the only economies where there is genuine profitability for them. In the case of Canada, for example, the Canadian government is the only major buyer of health care in the entire country. It gets an incredible amount of influence there to determine who gets what and what the prices are going to be. That monopoly position gives them power that they should never have to determine how health care resources are allocated, and skews the entire market downward, draining most incentives for Canadians to do research and product development for health care.

I doubt that ZDNet would ever say it, but every argument for controlling health care is equally valid for controlling IT. IT is one of the most wasteful industries in human history filled with dysfunctional boondoggles that cost vastly inflated sums of money. The argument for putting price controls on Oracle, Microsoft, SAP, Apple, etc. are very powerful if one accepts the premises used to justify socialized medicine. In fact, there is an even greater argument in that overly expensive health care still does an unqualified good in many cases of preventing serious harm and death, whereas most "enterprise" IT products are as cost appropriate for their purpose as a Ferrari is for a daily commuter car. How many businesses get raped using Oracle as a glorified bit bucket when they could use MySQL or PostgreSQL? Too many.

In the case of IT, the market has been forced to find ways of meeting businesses' needs without government intervention. For many small businesses, a careful DBA and development team can use MySQL instead of Oracle. They can develop a Java EE-based application with JBoss instead of Weblogic or WebSphere. Device developers can modify Linux or a flavor of BSD for an operating system.

There are better ways of handling this ranging from expanding the supply of labor, to making individuals shoulder a greater burden of the cost for their own care in exchange for higher wages (in order to make people more economically rational about their choices). None of these things are even on Obama's radar.

A new post

2009-01-17T18:36:53Z

Testing...

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2008-02-28T21:47:10Z

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2008-02-28T21:42:17Z

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Basic entry

2008-02-28T21:33:12Z