A Short Post on Capitalism and Healthcare

Posted August 16, 2009 by whitecoattales
Categories: Healthcare Policy, Healthcare Reform

Tags: , ,

I’d posted this as a comment on Mike the Mad Biologists blog a couple of days ago, and someone mentioned that it would be nice to have this in linkable form.

Someone over there said this about insurance companies:

Insurance companies do nothing wrong. They are FOR-PROFIT publicly traded companies whose obligations are to their shareholders. It’s actually illegal to some degree for them not to make as much profit as they can. They don’t make money by paying out. They make it by NOT paying out. It’s capitalism, folks

Whether health care is something that should be (out)sourced to the private sector is one question, and reasonable people can probably disagree. But expecting the private sector to act like the public? That’s just crazy.

I found that comment ridiculous on a number of levels. Most striking is the knee jerk “It’s capitalism.” So often people tell me that, without actually knowing what capitalism is. At any rate, below is my response in full, I hope that it clears up a couple of the deceptive or ignorant things people say about health care and “the market.”

Insurance companies do nothing wrong.

Idiotic statement.

They are FOR-PROFIT publicly traded companies whose obligations are to their shareholders. It’s actually illegal to some degree for them not to make as much profit as they can.

To be clear, wrong is a moral judgement, not a legal judgement. There could be a law FORCING insurance companies to shoot sick people in the head for profit, and it would still be morally wrong. There is no such law.

To argue that insurance companies are doing things that are legal, that’s a different kettle of fish.

Recission is legal. That’s why insurance companies do it. When questioned on the subject by congress, the insurance company representatives uniformly said that would NOT stop practicing rescission because rescission is legal. There is no question that recission is morally wrong. So insurance companies can do wrong, and do so regularly.

They don’t make money by paying out. They make it by NOT paying out. It’s capitalism, folks

I hate the “It’s capitalism.” argument. It’s not capitalism. That’s not the definition of capitalism. I encourage you to open an economics textbook. Capitalism is an economic system in which the means of production are privately owned, and labor/goods/capital are traded on a to-varying-degrees free market. Capitalism says NOTHING about insurance companies “paying out.”

Infact, in a large way insurance companies as-they-are-now are anti-capitalist, or at least anti-freemarket. “Free markets” only work when certain assumptions are met including:

-Markets need to be open: They generally aren’t in healthcare, you can only choose from options your employer has.

-Information is abundant: Not true in the insurance markets. Even the insurance reps don’t understand what they’re selling most of the time. I promise you most of my patients don’t know head or tails of what the options in front of them mean.

-People act rationally: Also not true in healthcare. People don’t understand their own “self interest” when it comes to healthcare. That’s the entire point of doctors – you’re paying for our expertise to give you an idea of what’s in your best interest. And there are no good markers to determine how to rationally choose a “good doctor,” which feeds the information problem above.

-No externalities: That is, the freemarket assumes every benefit or cost in the system is contained within the prices given. That’s 100% not true for healthcare. Your health is the definition of an externality. You can’t reasonably put a price on it, and if you could, you could not rationally divide up that price. That is, even if you said “X dollars is the cost of a life,” you couldn’t reasonably say “and Y percentage of X is the value of keeping my blood pressure under control.”

There are others, but those are the ones that come to mind. Clearly, it’s not just “that’s capitalism,” and saying so betrays a huge misunderstanding of the basic concepts we’re talking about.

 

Whether health care is something that should be (out)sourced to the private sector is one question, and reasonable people can probably disagree. But expecting the private sector to act like the public? That’s just crazy.

 

The question was never having the private sector act like the public sector. The question was “can the private sector blatantly deceive it’s customers about what it’s selling forever with impunity.”

Healthcare Reform

Posted August 2, 2009 by whitecoattales
Categories: Healthcare Reform

Tags:

There is a ton of misinformation about healthcare reform being spread around.

I’ll try and put together some resources, and maybe riff a little myself on the subject sometime this week.

In the meantime, check out this quick illustration of my point by Paul Krugman.

The 116th Meeting of the Skeptics’ Circle:The Wooful ER

Posted July 30, 2009 by whitecoattales
Categories: Chiro, Education, Medicine, Science, Skeptics' circle, Teachable Moments

Tags: , , , , , , , , , , , , , , , , , , , , , , ,

It’s time for your favorite blog carnival and mine, the Skeptics’ Circle!

 I had the most horrible dream the other day. After watching a Mitchell and Webb Sketch about a homeopathic ER, I had nightmares of being trapped in an ER just chock full of Woo, and other nonskeptical gibberish.

Walk with me, through the valley of woo, in the nightmare that is the wooful ER.

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Last Call for Skeptic’s Circle Submissions

Posted July 28, 2009 by whitecoattales
Categories: Skeptics' circle

Hey guys, one last call for submissions. I’d like to get the post up during working hours on Thursday, so if you really your post to be included please email it to me before 5pm on wednesday evening, eastern standard time.

Email all submissions to whitecoattales at gmail dot com.

Dr Sanjay Gupta Gets Medicine and Race Exactly Wrong

Posted July 26, 2009 by whitecoattales
Categories: Exactly Wrong, Medicine

Tags: , ,

I’m not a Sanjay Gupta fan. As an Indian-American medical student who has an interest in communicating medicine to the public, the comparison comes up from time to time.

He’s got a 2 minute short up on CNN.com here. Read the URL, it’s more than a little sensational, referring to “medical apartheid,” and the video itself isn’t much better.

  Read the rest of this post »

Calling All Evidence Based Chiropractors

Posted July 24, 2009 by whitecoattales
Categories: Chiro

Tags:

If YOU are a chiropractor, or KNOW a chiropractor, who feels they use science and evidence based chiropractic, PLEASE pass this request along to them. If you know a chiropractor who DOESN’T practice evidence based chiropractic, pass this along to them as well!

I’ve spent the last month on general internal medicine in a rural community. Driving around this particular community what strikes me is just how many chiropractors there are! I’ve seen 4 offices for primary care doctors – either DO or MD, and 10 for chiropractors. Many people appear to be using chiropractors as their PCPs. Needless to say I have a problem with this. Below, I have some questions for these or any other chiropractors who would be willing to take some time to answer.

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The 116th Meeting of the Skeptics’ Circle: Call for Submissions

Posted July 20, 2009 by whitecoattales
Categories: Skeptics' circle

Tags:

I’ll be hosting the 116th Meeting of the Skeptics’ Circle on Thursday July 30th.

Send me your best skeptical writing before July 29th at 5pm! Submission guidelines here. When you’ve got your post all ready, send me a permalink, and a brief description to whitecoattales at gmail dot com.

So far we have two posts already submitted, I’m really hoping we can get a big turnout for this one so keep it coming guys!

 

*Edit 7/25/09* bolded my email address for easier reading.