Hidden Deadlines of Economics

But with respect to economic reforms, with single payer health care at the top of the list, there can be hidden quasi deadlines. Every year that single payer is not enacted is another year where health costs rise higher than general inflation, is another year where the gap between health costs and peoples' incomes becomes wider, is another year where people are ruined due to lack of health care, and is another year where in general the rich get richer and the large and growing number of relative poor get poorer.

The wider the gap between rich and poor, the greater the poverty rate, and the bigger the per capita income gap between the US and the other countries (that do have single payer) the more economically difficult it becomes to implement single payer, and the less the expected payoff becomes, in economic terms, from enacting single payer. For one thing, the ever growing number of relative poor people have less and less taxable income, which means that a higher and higher tax hike on the rich is necessary to finance single payer as the years of delay accumulate. For another thing, as the years go by, the gap between the actual health costs being charged within the failed health insurance system and the costs that a reasonable single payer system could support is growing.

In general of course, the US economy as a whole, and the average person in it, is being damaged worse and worse every year that health costs run out of control due to lack of single payer.

At the same time, in economic terms (although not in health terms) the "rescue beneifits" of single payer are being gradually reduced every year that single payer is delayed. People going without health care are becoming sicker and sicker, and thus more expensive to treat if single payer were ever enacted. And the damage to the US economy is mounting year by year and has apparently already reached the point where it can not be fully repaired by single payer.

The victory of the reputable, single payer countries over the US with respect to the health care and the overall economics systems is due not just to the existence of single payer in those countries, but also due to correct timing, specifically the fact that most of the single payer countries enacted single payer many decades ago, when the economic benefits for doing so were truly large.

Meanwhile, the US keeps delaying, and the potential economic benefits are gradually going down. It is possible that the US has already reached the point where its citizens could not possibly be as well off, in the next few decades at least, even if single payer were enacted in 2009, as for example citizens of Europe will be with their well established over many decades single payer (and unemployment relief) systems.

On the other hand, it will be at least 50 years before the economic benefits from enacting single payer in the US will become small or trivial; all I am saying right now is that the benefits are gradually being reduced, and that the benefits are already substantially less than the benefits would have been had single payer been enacted 20, 30, or 40 years ago.

In summary, in economics (unlike with most social reforms such as abolishing slavery) sometimes you can delay a needed reform to the point where the benefits of it become much smaller than they used to be, and the costs much higher than they used to be.

What I am talking about is why single payer systems are completely out of the question in very poor countries, such as for example many countries in Africa, Central America, and South America. The best a truly poor country can do is a partial, modified single payer system, with for example free care clinics that are partially subsidized by the Government playing a role in increasing health care access. But no truly poor country (unless it becomes a dictatorial left country in the Cuba mode) can successfully maintain a true single payer system in the European/Australian/Japan mode.

Although most of the right wing is too dumb to understand economics concepts such as these, you can bet at least a small number of influential right wingers are aware of these things, and as a result are supporting the fake "health reform" that is being talked about in 2009, which when all is said and done is nothing more and nothing less than a delaying tactic against single payer.

[The above was in response to this article.]

Get Canada to Allow Americans to Invest in Their Health System

A GUEST POINT

ubrew12 July 11th, 2009 2:07 pm
I wonder if we could appeal to Canada's healthcare system to treat us? I mean, if enough Americans got together and simply said, 'we are going to buy into Canada's healthcare system. We'll send our money to Canada every month, and they will treat us when we are ill according to their protocols.' If ENOUGH Americans said this, the government would have to go along, wouldn't they? If, say, 50-100 million Americans just said, 'I'm buying Canadian healthcare', we could negotiate our way out of the corporate-dominated American system altogether, and let them fight over the scraps that were left.

This is actually a great (and very interesting) idea from the economics perspective, because many Americans could offer the Canadians more per person for Canadian health care than the Canadians themselves are paying, but still save a lot of money over what they would pay in the grossly overpriced American system. In other words, many Americans could more than pay their way into the Canadian system and still come out way ahead of where they are now.

To a limited extent, Americans buying into better health systems is already going on. For example, some Americans buy drugs from Canada. And more and more Americans are getting critical health care by simply travelling to any one of numerous other countries to get it. Anyone up for a European vacation that pays for itself, laugh out loud?

This would not work for the impoverished Americans, though, because they can not afford even Canadian health costs. And I don't have a clue as to how you could get the Canadians to politically agree to this though.

A related alternative to this is for a good number of American health practitioners to opt out of the failed insurance system and then simply form health co-ops that would be miniature single payer systems, with the cost control achieved by consent of the buyers and sellers rather than through the Government. The practitioners would lose only a small amount of income and possibly nothing at all if they did this, since they too are heavily burdened by the needless costs, delays, paperwork, and denials of care of the health insurance industry and of the malpractice insurance industry.

Again though, this would not work for the poor in the US unless they could find some practitioners who were willing to become truly progressive and offer price for health service schedules that were sliding based on income.

Note that these kinds of solutions are solutions based on "free market theory". Such solutions do not work for the poor, and they are also, ironically, ignored or quickly shot down by the fake right wing proponents of "free markets".

If laws and/or regulations forbid doctors etc. now or in the future from offering their services outside of the health insurance system, then we are truly living in a very unfree society.

RESPONSE:

ubrew12 July 11th, 2009 4:50 pm
Yeah, I hadn't thought of how the poor would pay for it. Another problem would be the future lack of choice: buying single-payer health insurance from Canada, you'd have to commit to it, preferably for the rest of your life. The cost of getting out of it would have to be VERY steep (nationalized healthcare lowers risk by demanding the insured be broad both geographically and over time; they pay a risk premium if you have the future option to get out of it). I'm beginning to realize that we pay a risk premium in America for the right to choose, and that premium is one of the reasons we have such high healthcare costs.

So Canada (if they went for this) would have to demand a 5-10-year (or lifetime) commitment from Americans buying in so they couldn't pay for one year, get all kinds of care, and then quit. There would have to be a non-profit American company that pooled all of the Americans who wanted to pay Canada for care, and which would be responsible along with the individual American customers for this and any other Canadian requirements.

Would someone please start up the American-Canadian Co-Op Health Care Company (a non-profit organization) immediately? I could do it I guess, but I'm no good at marketing or politics, laugh out loud. Thanks in advance.

Don't know quite what you mean by the "risk premium" in your last sentence. That term is normally associated with the profit-making insurance industry. If health care is done by private health insurance companies, there are all kinds of forces which conspire to balloon out the costs (of both the care and the insurance). One of them is the actuarial risk calculations, which of course the insurance companies distort in their favor extensively.

By the way, in a true free market economy, health care insurance would be a very risky business to be in, and some health insurance companies would lose money in some years. But since almost all American health insurance companies rake in fortunes every year, we know just from that that the US does not feature a free market economy, at least insofar as health care is concerned.

Commonly added to premiums resulting from these distorted (upward) actuarial calculations would be a "risk premium" which, loosely translated, means "safety margin surcharge added on to make sure that our insurance company can not possibly lose out on the care we actually intend to pay for". Then on top of all that more surcharges are added, most notably one for a profit for the shareholders and another one for extra money so that the executives can be paid obscene salaries.

And then even after making it a 100% certainty that they will make a killing in the business (excuse the pun) the private insurance companies engage in all kinds of denial of and reduction of care schemes that endanger and sometimes wreck the health of their customers.

Whereas, in a single payer system, scratch out just for starters the obscene salaries, the profit surcharges, the risk premiums (profit insurance premiums) and the distorted upward actuarial calculations. Limited time does not permit me to go through the list of other elements that increase the cost in the present system that go away in a single payer system.

In any single payer system, the actuarial calculations are reasonable at the least, not unreasonably excessive as in they are in the US. In the US, a good chunk of health insurance premiums go not only to making the insurance company profitable, but to insuring the insurance company is profitable via various surcharges, as ironic as that may sound, since most people think insurance companies can possibly lose money, or at least they used to think that.

Where cost control is especially prized, such as in Japan, actuarial calculations are intentionlly conservative, the precise opposite of the situation in the US. Then, in countries such as Japan, if actual demand for health care exceeds the calculated projected demand by a substantial amount, pressures to rein in hypochondriacs and to increase the supply of hospitals, doctors, MRI machines, and so forth, are automatically generated, and the Government, in conjunction with private industry, makes sure that the supply is quickly increased. Occasionally, someone with a serious problem in Japan during unexpected high demand might have to be transferred to a nearby prefecture to get immediate health care.

This means that unless the Government is incompetent, even if the Government underestimates the demand for health care a little, which might happen in a conservative and carefully managed system such as Japan's, all people who really need care still get all the care they need, with at worst small and almost always ultimately trivial waiting times.

[The above exchange was in response to this article.]

Rank Ignorance About the Economics Superiority of a Single Payer Health System

Only in an extreme right wing, third world tendencies type of country would single payer be dismissed by smug academics who don't know what they are talking about.

As to the idiot who dismissed single payer due to excessive costs, the fool completely missed the point. Yes, the US has had health care rates run up at many multiples of general inflation for so many years due to not having single payer that now it is necessary to have BOTH cost reduction and single payer in order to fix the failed system. This doesn't mean that single payer is not necessary. It means the US was foolish for not having single payer and the cost control that naturally goes along with it many years ago the way that every reputable country did.

Get it, fool?