He writes
So one view — the view that I hold — is that we need competing integrated providers. Granted, the case for integration is also the case that at least some on the left make for a socialized system modeled on the National Health Service in Britain or the VHA. It’s not obvious to me that a single government-run integrated provider would prove more effective than competing integrated providers, particularly since a single government-run integrated provider would be unusually susceptible to political pressures against, for example, the offshoring of medical diagnosis and treatment, the substitution of technology for labor, periodic reforms of staffing and compensation, etc.
The goal is thus not competition between insurers as we know them. Rather, it is to first, in Christensen’s words, “put care and insurance in the same bed,” and then to have these new insurance entities duke it out.
This strikes me as the kind of thing that has the potential to work. Don’t get me wrong, I’d be shorting this idea like crazy. However, that’s because I would short all attempts at health care reform.
My sense is that people don’t want to stop dumping lots of resources on the sick.
Which ultimately is fine. For example, we could have a world in which people didn’t really care about personal space or privacy. Folks would sleep in rooms full of bunk beds; eat in giant cafeterias and bathe in communal showers.
Such a world would likely consist primarily of gigantic skyscrapers each housing thousands upon thousands of people. The production of non-residential goods and services would be far higher not only because resources would be freed but because the arrangement of folks would be far more conducive to agglomeration externalities.
However, that’s not how people feel and we pay a “price” for it. Yet, like goes on, even as people sleep in their own bedrooms and eat in their own kitchens. Such waste has not ground humanity to a halt.
Likewise if people cannot bear the thought of doing everything they can to save the sick and dying, life will still go on. Humanity will not grind to halt. We can wring our hands about the waste, but ultimately such a world would probably feel as icky as the world with no personal space.
There are probably things that can be done on the supply side to ease suffering, but I don’t anything will be done on the demand side to keep this from eating up more and more of human production.
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Saturday ~ December 17th, 2011 at 5:49 pm
Becky Hargrove
Someone wrote a day or two back about the present as a “waste economy”. Perhaps it’s not so much waste, as just a flight into privacy to regain the autonomy we once experienced in multi-purpose environements. On some level our brains must really miss those agglomeration externalities because the defined / created experience by others isn’t quite the same. As a child I was fortunate enough to experience widely varied environments in which what happened stuck to memory better, than the places more strictly defined as single purpose.
The physical compartmentalization is identical with the mental, and the process of separating them has been beneficial in the aggregate economic sense. But the mind struggles with that separation every step of the way, and ultimately cannot financially afford the separation itself. How would we find better balance with the need for privacy, and the need to do things together (more spontaneously), in the future?
Saturday ~ December 17th, 2011 at 8:59 pm
Lord
Then again, a single entity won’t face competition to cut services and raising costs and profits, to exploit whatever rules are adopted, to shift the expensive to someone else, to deliver a lot of low value care to keep the inexpensive. Is the defense industry really very effective at keeping costs down? It probably is more effective at advancing it though.
Saturday ~ December 17th, 2011 at 9:07 pm
Lord
Competition only reduces cost if cost is what it important. In the absence of that it proliferates options and induces more usage. Single payers are better at valuing cost. Multiple providers are better at diversifying services and lobbying.
Saturday ~ December 17th, 2011 at 11:23 pm
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