Monday, January 25, 2010

Health Care, Insurance, Insulation, Innovation

My primary concern about reform proposals is that I want innovation, profit-fueled innovation which bankrupts current stakeholders because they're making buggy whips, except when they move fast and make painful choices. I want more innovation than all the innovation we've seen so far. I want robotic nurses to take care of me. I want stem cells to fix my aging joints. I want painless dentistry. I want tiny robots inside my body -- among other things, to deliver the stem cells. Frankly, I want to over-consume health care like most of my fellow-Americans. The more government regulation handles things, the more the people with seats at the table will be guaranteed their "fair" share; that inhibits creative destruction. It also inhibits me from getting the health care insurance I want; I live in New York State, which as Reason Magazine says is Exhibit A in the case against programs like our proposed health care insurance "reform".

Okay, I also have secondary and tertiary concerns, mostly about politics and regulatory capture and crony capitalism and politics, and I'm not sure about any of this, and I keep meaning to note down all my current notions to see which if any survive the year. But mainly, it's about innovation, and if something resembling the current plans gets through then I agree with Megan McArdle that

We've just increased substantially the supply of unrepealable, unsustainable entitlements. We've also, in my opinion, put ourselves on a road that leads eventually to less healthcare innovation, less healthcare improvement, and more dead people in the long run.
(I don't think she actually means "more dead people", but rather "higher age-adjusted mortality rates".)

I like Will Wilkinson's analysis in Will Health-Care Innovation Survive Obamacare?, where I tend to think the answer is "yes, but at a seriously diminished rate." Or maybe not.

Provisionally, I'll just note down what I would now support, until the minute that I actually realize how silly these provisions are:

  1. Require transparent pricing, uniform no-bargaining pricing, from all licensed health care providers.
  2. Allow unlicensed health care, wherever it's clearly labeled as such; it won't get public support but people can choose it.
  3. Take away the employer-based tax exemption; health care shouldn't be an employment issue.
  4. Add a universal tax-funded "insurance" policy: if your expenditures for "proven procedures" from licensed health care providers exceed the overall 16% (of GDP) average, then the taxpayers contribute. In particular if your cost is 16--32%, say 30%, then the taxpayers kick in (30-16)/2=7%, half of the overage, and the maximum you can pay is 24% of your income whether that's $0/year or $10M/year. Or something of that general magnitude; I wouldn't fuss about adjustments to these figures. The point is to combine protection from catastrophe (but not necessarily from financial pain) with making sure that market prices are set by people or groups who are actually bargaining in that market, i.e. the better-off people for whom procedure X will not be covered.
  5. If you want "unproven procedures" and you can pay for them, that's fine too; the licensed health care providers should have a strong motive to come up with new stuff and document/publish that it works. The FDA should not be able to keep you from paying for weird medicines, but it should keep you from charging it to the rest of us. If procedure X has no accepted studies supporting it, then it's up to you to pay for it.
  6. Whatever additional insurance you want to buy for proven or unproven procedures is just fine, and can be bought across state lines. It's your problem. You want to save your money in a special bank account? Feel free.
  7. Any care that has been paid or partly paid by public funds goes into an anonymized public database. (Yes, that's hard, but I am more willing to risk failures in privacy than failures to learn about what does and doesn't work.)

And that's my plan, as of today. I'm sure it would be perfect.

Or then again, maybe not.

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