John Goodman: All the Care that Money Will Buy
I believe we could spend our entire national income on health care. Not by frittering money away, but by spending it on goods and services that even in small ways could improve the odds of better health. (Examples below.)
I find that most people in health policy agree with that assessment, but rarely do they see its logical (and I would say obvious) implication. If we spent all our income on health, we would have nothing to eat, nothing to wear, no place to sleep. There would be only health care. Since that’s clearly an undesirable state of affairs, it must be good for people to refrain from obtaining all the useful care that money will buy. Further, such restraint needs to be exercised quite often.
What brings this to mind is a new RAND study finding that people with Health Savings Account plans consume less care than people with conventional insurance and have lower health care costs. The people who were studied cut back on such “useful care” as mammograms, screenings for cervical and colorectal cancer and even childhood vaccinations.
Some critics pounced on this result and claimed that consumer-directed care is bad for patients. The critics are, of course, very wrong. ...
... In fact, the patients’ behavior is exactly what you would expect from a rational consumer of any product. When something is free the temptation is to take everything that is offered. The incentive to distinguish between what is “necessary” or “useful” and “unnecessary” or “unuseful” is largely nonexistent. When you have to pay market prices, however, you have an incentive to pay more attention — figuring out what’s “unnecessary” and dropping that as well as those “necessary” items whose value is less than their price. ...
... Spending all of other peoples’ money on health care is easy, like taking candy from a baby. To prevent that from happening, public or private bureaucracies can ration your care and tell you what services you can and cannot have. Or, you could manage more of your own health care dollars and make you own choices between health care and other uses of money. ...
