I am seriously asking here because I haven’t been following him long enough to fully understand his views. I was shocked, though when he wrote

But whatever the [famous vet spending] graph’s problems, the sudden acceleration in medical spending on pets does offer insight into spending on people. If you took a limping Fido to the vet and were informed he had a malignant tumor in his foot and three months to live, you would cry, and feel terrible about it, but that was basically that. But what if you were told that there’s a $5,000 treatment that could potentially save your dog?

Suddenly, you have a choice. It’s not just how much your dog’s life is worth to you. It’s how much it’s worth to you to feel like you didn’t decide to let your dog die. A treatment that isn’t strictly "worth it" in economic terms — a treatment that may not even save your dog — may be worth it to you, because you want to feel like you did everything you could. You want your economic decisions to line up with your emotions.

The rise in health-care spending is not simply that we have trouble saying "no." It’s that the march of health-care technology has forced us to make a lot more decisions. Conditions that would have simply, sadly, killed people 30 years ago have treatments — which may or may not be effective — today. And it’s hard to say "no" to those options. But the crucial point isn’t when we accept or reject the treatment. it’s when we’re faced with a treatment to accept or reject. It’s when death begins to look like a decision.

This strikes me as an articulate illumination of Robin Hanson’s theory. However, that theory usually leads people to conclude that cost control is the answer and thus people need less insurance, not more. The more insurance we have, the more it encourages to spend, the more it encourages hospitals to invest in life saving technology that we will feel guilty for not buying.

Its like if you thought that people only buy things from telemarketers because they are under pressure and so the solution is for the government to provide everyone with funds anytime they are corner by a telephone salesperson. Won’t this just encourage more telemarketing?

How is this circle squared?