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Healing America

Wrapping up.

Out of Pocket

Next chapter is about his experience in India, and the default out of pocket model, and how much it sucks. Though he finally opts for a couple weeks of Ayurvedic massage+ treatment, and it helps. Percentage of medical spending out of pocket: 80% India, 60% China. That's some pretty crappy socialism, guys. 15% US. In poor countries, care is often available only in the national capital; not just a matter of funding, but doctors being hard to find elsewhere. Nigeria puts import duties even on donated mosquito nets; this sucks medically, though I'm reminded of a paper pointing out that for low rule of law states, tariffs were an easy tax to collect and somewhat progressive, since mostly it's the rich of the country who can import stuff.

Cuba and China get mentioned as poor countries. Cuba has a Beveridge model, without the private aspect of GPs; more doctors per capita than anyone, and exporting them in return for cheap food and oil. China had a barebones NHS equivalent in 1978, the "barefoot doctors", but privatized, going backwards in health accessibility. "If you want to make your American readers feel better, have them look at China."

Recent Changes

Then he talks about Taiwan and Switzerland, as two rich countries who universalized in 1994, right when Clinton was going down in flames. I add that Israel went fully universal (though 90% had been covered by existing plans) in 1995; the international universality of universal health care is itself kind of recent. Germany is 1880s sure, Britain 1945, Canada 1964, but some other countries were a lot more recent. Though some of that is about having cracks in a mostly universal system, like France's last 1% in 2000.


Anyway. Taiwan went from poor to rich very quickly, and was mostly out of pocket when it decided it needed something better. They looked around the world, consulted William Hsiao, rejected the US as not even having a health care system, and imitated Canada. Payment is by premiums, not tax; he says the poor get interest free loans? Sounds odd. They also copied France's carte vitale. And they moved fast: law passed in July 1994, system went into effect March 1995. The leader wanted electoral payoff ASAP, I think. Compare to the USA's 4 year trek. Massachusetts took a year to get everyone covered, with another year to start enforcing the mandate.

Taiwan's efficient: 2% overhead, even better than US Medicare. France has 5% admin overhead, Canada 6, US 20%. It spends 6% of GDP. Doctors have low fees, high volume, and clinics are open 7x12.

I got to speak to a couple of Taiwanese last night too. They like the system, and S. said it was cheaper to get lots of stuff there than here, even with the $1500 round trip ticket. On questioning, that might apply mostly to emergency dental care, but still. She said "everyone needs health care, government makes us share what needs to be shared", matter of factly, which reminds me of later moral vs. economic argument stuff.

Tangentially, Reid said that of Japan's colonies, Taiwan had a uniquely benign view. Relatively benign, anyway. It was the model colony, and got lots of roads, schools, and hospitals built for it, and S. said the complaint of the older generation is more about being forced to learn Japanese, as opposed to rape camps. The younger generation doesn't seem to care much; my impression is that Korea and China would be... different.


Rich for much longer, they had a system of nonprofit mutuals, which started getting bought out, converted to profit, and altered to kick people off. After 5% became uninsured, the Swiss sense of solidarity and of equal access to rights like schools and trains, kicked in, and they went to the Bismarck model, passing by referendum with a bare majority, but it seems ensconced now. It's closest to the US: insurers have a mandated non-profit basic package, competing on price, extras, and user-friendliness -- which means the government isn't setting the prices of premiums. Nor of medical care itself, I think. No claim can be denied if signed by a doctor or hospital, which is stronger than the US will be.


In both countries, reform was sold was a moral issue. Equal fundamental rights, we're all in this together, and such. The Clintons emphasized the potential for saving money, and so did Obama for the first year of health care reform, only switching to "everyone deserves care" near the end, and supposedly making a difference with that.


1953 saw Watson and Crick and Franklin finding DNA, but it also saw Ernst Wynder present a paper connecting smoking to lung cancer. One of these is famous, the other one has saved millions of lives without getting even a Nobel in Medicine. Public health isn't sexy.

British tobacco warning: "SMOKING KILLS". This reminds me of similarly blunt "you may die" train warnings in Britain.

Japan has rules for student ergonomics, with teachers visiting the home to check on them.

Singapore cars beep madly if you drive faster than 55mph.

Bad incentives: The average American keeps a plan for 6 years; paying for preventive care made little sense for insurers, with the benefits accruing to another insurer, or to Medicare. Americans will avoid tests, for fear of learning of a condition they'd have to disclose.

Sweden and Denmark are described as having low wait times. Finland gives or loans free baby beds to new parents. They seem to have locally run NHSes. Spain and Italy are also NHS-like. Only the US has "networks". Some countries like the UK have GPs as gatekeepers, but the entire country is "in network".

A friend reminds me of stories of Japan not having enough hospital space, and people dying in ambulances while looking for a hospital. Reid didn't mention those at all, though he does call the hospitals underfunded past "drab" and approaching "bankrupt". At 8% of GDP, "spend more" seems a valid response.

Standard principles are a unified system, with simple administration and single buying power; non-profit finance; and universal coverage. Obamacare doesn't live up to any of those, though comes closest on the third. 23 million people are predicted to still be uninsured in 2019; I don't know how much of that is voluntary non-compliance with the mandate. Insurers will still be for profit, and allowed to have 20% overhead (15% for the shrinking employer plans). The crazy quilt of Medicare, Medicaid, VA, Indian Health Bureau, and private insurers, with different payment systems, won't be simplified at all, so doctors will still have their own high overhead costs just to be paid.

So we've made a step forward. But compared to extending Medicare to all, or making insurers non-profit, price-regulated, and using a standard payment system, it's a very small step.

Note that a really unified system would mean either getting rid of Medicare and putting old people into regulated insurance, or getting rid of insurers (and Medicaid, and the VA) and putting everyone on Medicare. Both seem politically... difficult. (Putting everyone on VA? Ha ha!) So the US seems doomed to have wastefully expensive health care into the indefinite future.

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Damien Sullivan

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