Less Than Zero
Erin Riley tweets from Australia:
Apparently all I need to do to get my Swine Flu shot is rock up at the doctor’s tomorrow. And it’s free. #ilovesocializedmedicine
Something that tends to get obscured in the health care debate is that a number of very different kinds of activities are undertaken under the banner of “health care.” When it comes to cutting-edge medical treatments, you can see the case for a robust private sector role—it’s about innovation.
But an awful lot of medical care is extremely routine. Someone falls and breaks his leg and needs the broken bone set. Someone needs stitches. Someone needs a strep throat test. If the test is positive, he needs antibiotics. Vaccines need to be administered. In situations like these, innovation is really not at issue. And with some of this stuff, like with the H1N1 vaccines, there’s a substantial public health issue in play. You really, really, really want the people who need the vaccine to get the vaccine. It’s much cheaper to give a vulnerable person a vaccine than to treat them after they get sick. And of course getting enough people vaccinated against things like measles is crucial to preventing new epidemics from happening. This sick of basic health care should really be free—perhaps provided by a robust national public health service with a nationwide network of clinics. In fact, ideally it would be cheaper than free so that nobody goes without the appropriate level of vaccinations, blood pressure tests, etc.
49 Responses to “Less Than Zero”
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November 4th, 2009 at 11:38 am
Do you have a bigger version of that picture?
November 4th, 2009 at 11:38 am
How much does it cost to administer the swine flu vaccine? 5 minutes of a doctor’s time? Do you even need a doctor, or can a nurse just do it? It can’t possibly cost more than $20. If we can’t expect people to pay for that themselves then there really is no hope for any fiscally sane health care policy in this country.
November 4th, 2009 at 11:41 am
basic health care should really be free
This is just so completely 180 degrees wrong. Basic health care is exactly what should not be free. It’s scary to me how completely misguided you are on this.
November 4th, 2009 at 11:42 am
“This sick [sic] of basic health care.” I’m sure our host meant “sort,” but I cannot resist making a bad pun…
November 4th, 2009 at 11:44 am
AB,
Flu shots are like $60 each, even at a Walgreens clinic.
Note for swine flue they are free, precisely because of the reasons outlined by Matt.
November 4th, 2009 at 11:44 am
Drat. There should be an ellipsis there…
November 4th, 2009 at 11:44 am
Many of the things that get to be routine medical care were first cutting edge medical treatments where the profit motive was involved. For instance, the setting bones comment ignores the enormous amount of innovation in orthopedic hardware and in orthopedic surgeries that we have seen over the last couple decades. Antibiotics were also quite cutting edge when they first appeared and even now, there are substantial resources put forth by private companies to try and hit the jackpots that drugs that treat multidrug resistant bacteria provide…
I think Matt is conflating two very different points. Most of us can agree that a more heavily subsidized public health system to provide basic care to people would be better than the alternatives but to then jump from that to denigrate the private sector’s innovation/focus on profitable medical products is a bit of a stretch…
November 4th, 2009 at 11:47 am
Yes, that explains the huge taxes on medical device manufacturers in the House bill – a desire to continue innovation where it’s needed.
Shorter house bill to type 1 diabetics: “Just die already, will you?”
November 4th, 2009 at 11:49 am
Mike S, Walgreens says they charge $25
http://news.walgreens.com/article_display.cfm?article_id=5212
November 4th, 2009 at 11:52 am
Yes, that explains the huge taxes on medical device manufacturers in the House bill – a desire to continue innovation where it’s needed.
Interesting James – so when I Googled “House bill” and “medical devices” what turned up?
House Bill = Big Win for the Medical Device Lobby
While the House bill comes down much harder on Big Pharma than the Senate, it gives the medical device industry a big break. As The Wall Street Journal points out today, the House bill cuts the $40 billion tax on the device industry that’s in the Senate Finance Committee down to $20 million. And, according to the Journal, “Senate leaders are also preparing to reduce the tax to around that level, according to industry officials and congressional aides.”
The tax reduction is an unequivocal victory for the device industry’s intensive lobbying campaign, which led a legion of prominent Democratic legislators to protest the tax for putting a damper on the industry in their home states. While the Senate had major players like John Kerry and Evan Bayh swinging out against the tax, the House had a lengthy list of Dems from across the country who warned Pelosi and Hoyer about the tax—including key moderates like Blue Dogs Jason Altmire and Zach Spade.
etc.,etc.
November 4th, 2009 at 11:54 am
This post seems on the money, but I suspect that while private for profit medicine is *a* source of innovation it’s hardly the only one. It would be interesting to review the history of medical innovations & discoveries to see in what kind of environment they were made. I suspect a fair number of them were by people in public institutions, others in universities, and, if one goes back a little ways, that many of the discoveries and innovations that were made in what is technically the private sector were not made in anything that resembles the private sector as we now understand it.
None of this is to deny the value of market incentives, but only to object to pervasive monocausal assumptions that the market and only the market is the driving force behind everything good (and the corollary that if markets are the source of some good, then the way to achieve more good is to favor markets at the expense of everything else).
November 4th, 2009 at 11:58 am
AB,
I just called last week and they told me $60!
Bastards.
November 4th, 2009 at 11:59 am
I think that some of the biggest things that we could do to help control costs would be to both greatly expand the nurse practitioner program and to also give people more incentive to use nurse practitioners. We have the greatest nurses in the world- its a shame that we don’t leverage them more to our advantage.
November 4th, 2009 at 12:00 pm
#10 – right, the proposed tax in 3200 was originally $40B. They lowered the proposed tax to $20B. That’s still $20B over what it is now.
So how about this: Your town proposes to raise your property taxes by 10%. Eventually, they only raise them by 5%. Being innumerate, I’m guessing that you celebrate your good fortune…
November 4th, 2009 at 12:01 pm
My workplace gave us all a flu shot administered by a nurse for free. I suppose that means within our organization that we had a “socialized” policy here, because everyone from the lowest paid employee to the highest received the same benefit.
It is amazing, I suppose, how the largest employers are actually the ones that resemble socialist paradises the most closely, the most egregious of these offenders being, of course, the US military.
November 4th, 2009 at 12:02 pm
v’s post @7. The first para seems v. sound to me, but I can’t understand the second in view of this sentence in MY’s post: “When it comes to cutting-edge medical treatments, you can see the case for a robust private sector role—it’s about innovation.”
November 4th, 2009 at 12:03 pm
If the AMA would get out of the way, nurse practitioners could open clinics and take care of a lot of the minor care problems for a lot less money.
But, no-oooo… that might mean an MD would only get two jaguars in the garage instead of four.
November 4th, 2009 at 12:04 pm
This is an interesting comment. In many biological systems (I’m thinking the brain specifically, but it applies elsewhere as well), when responding to a stimulus or to something in the environment, a system will eventually “makes the response more routine”. By “makes the response more routine”, I mean the system adapts and uses a more energy-efficient mechanism to handle the stimulus. Thus, less energy is wasted on this and more focus (energy-wise) can be devoted to less common/more-novel stimuli.
If you consider a society as a dynamic system, then a government providing/subsidizing healthcare services at lower costs, the components of the society (i.e., people) don’t have to expend as much energy (i.e., resources) to dealing with these routine occurrences and these resources can be devoted to other tasks/dealing with other situations.
November 4th, 2009 at 12:08 pm
think that some of the biggest things that we could do to help control costs would be to both greatly expand the nurse practitioner program and to also give people more incentive to use nurse practitioners.
As someone who has to give himself injections from time to time – how about this. If you want, you can grab a dose out a cooler at Walgreens or CVS, buy it, jab yourself in the arm, and be done with it. The idea that every drug, test, vaccine or procedure needs to be administered by a licensed profession is ridiculous in many cases.
November 4th, 2009 at 12:09 pm
When it comes to cutting-edge medical treatments, you can see the case for a robust private sector role—it’s about innovation.
Sorry, but this is complete and utter crap. The only thing the private sector is better at “innovating” is profits, and they regularly and intentionally distort the effectiveness of their treatments toward that goal.
November 4th, 2009 at 12:10 pm
When it comes to cutting-edge medical treatments, you can see the case for a robust private sector role—it’s about innovation.
This is pretty unclear to me. A lot of the big breakthroughs in medicine are the result of decades of basic research which has little return and is almost all government-funded.
The reality is that most of medicine is a high-volume, low-margin business. And if you invent a better mousetrap, there’s the danger that 3 years of widespread use proves, uh, it kills people too (see Vioxx).
In the for-profit sector, I expect you would see a lot better and more consistent profits through abusive practices (funneling $ to doctors so they make hospitals order your devices, for example) than you do by outcompeting the other guy with a better product.
I just fail to see that the private-sector-innovation case is well supported by the actual history of medical innovation.
November 4th, 2009 at 12:10 pm
If the AMA would get out of the way, nurse practitioners could open clinics and take care of a lot of the minor care problems for a lot less money.
I am not sure I buy this. There is nothing stopping docs from doing the same thing. It is just that it is not cost effective to run a clinic like that. The billing and maintenance of medical records overhead means that a family practice clinic needs to support both minor care problems as well as high-margin care in order to cover their expenses. What you do have is such clinics having both doctors and NPs on staff, leaving the low-cost care to the NPs.
November 4th, 2009 at 12:10 pm
#18 – if you believe govt delivers anything at lower cost, sure. However, since govt programs now tend to involve:
– Unions that get their members more pay than most private sector employees get
– Unions that get unsustainable defined benefit pension programs
It’s unclear to me why you think govt will deliver at a lower cost than the private sector. If we didn’t have entities like SEIU feeding at the public trough, maybe. Since we do, not so much.
Start Googling about the looming pension crisis, and pay attention to how many cities and counties are starting to end up in the same place that Vallejo, California found itself in.
These problems aren’t partisan in nature; they are a simple matter of math.
November 4th, 2009 at 12:10 pm
But, no-oooo… that might mean an MD would only get two jaguars in the garage instead of four.
Are you an MD, if not why not?
If not, you really should get started on it – think of all the cheap care you could provide to the needy?
http://www.aamc.org/students/mcat/
November 4th, 2009 at 12:14 pm
“In fact, ideally it would be cheaper than free so that nobody goes without the appropriate level of vaccinations, blood pressure tests, etc.”
I agree with the basic point. But you’re actually conflating
some subtly different issues here. Vaccination serves two
purposes: it protects the individual, but in public-health
terms the goal is to vaccinate a sufficient percentage of the
population so that an outbreak of the disease will die out
rather than spreading. And once you’ve reached that level -
which depends on the epidemiology of the particular disease,
and the effectiveness of the vaccine, and demographic
factors – then effectively everyone gets protected because
there just won’t be any large outbreaks. Up to the level
of enough-to-prevent-spread-of-the-disease, vaccination should
indeed be “cheaper than free”. Beyond that, it’s not so
important. And since different people are more or less
likely to spread the disease, the effectiveness isn’t
uniform: you get much more bang for the buck from giving
free vaccines to medical personnel and teachers than you
would from giving to office workers.
Preventive care for non-infectious conditions is simpler.
November 4th, 2009 at 12:29 pm
I don’t see why you (Matthew Yglesias) think that the private sector is better at medical innovation than the public sector. I’d say the evidence is very strong that the US public sector funds more successful medical innovation than the US private sector (or any other entity in the world).
I think the cutting edge of medical innovation is NIH grant financed research conducted mostly in universities. What private sector innovations do you have in mind ? I’m sure that there arerecent private sector medical innovations that weren’t based on publicly funded research. At the moment, I can’t think of any. Can you ?
November 4th, 2009 at 12:34 pm
It’s reported in the comments above that the 2009 H1N1 flu shot is free? If that’s true, I think it’s something Matthew should have mentioned, especially in the context of responding to the Australian’s tweet.
And while it may be $25 or whatever to get the seasonal shot from Walgreen’s and costs to get various immunizations from your local doctor, it’s long been my impression that one can get numerous immunizations from one’s local public health department for free—is this not true? And, if true, that’s also something one might reasonably expect Matt to have mentioned, and to know, before responding to the aforementioned Autralian’s tweet in a blog post.
November 4th, 2009 at 12:39 pm
jmo- to me the point is that it doesn’t take med school then 3 years of residency to provide the vast majority of routine medicine. If you want to lower the cost of something lower the barrier to entry. Sure some people would prefer to pay extra to go to a doctor for their routine stuff. But that shoudl be a conscious choice and people should pay less if they are willing to use a nurse practitioner.
November 4th, 2009 at 12:41 pm
Yes, public health is good. Yes, routine (not cookie-cutter) medical care ought to be free. But true public health investment is about avoiding the necessity of medical intervention to begin with. (Plus, treating public health with a “fluoride in the water” approach is a terrible idea.)
November 4th, 2009 at 12:57 pm
Anybody who can’t get a free flu shot isn’t trying very hard. Sure, it might be more convenient to pay $60 at Wal-Mart instead of wait in line at a public health clinic, but the clinics are there. They might only give you a shot if you’re in the right age & health risk group, but that’s because (a) we don’t have enough vaccines for everybody and (b) not everybody needs it anyway.
November 4th, 2009 at 12:59 pm
#10 – right, the proposed tax in 3200 was originally $40B. They lowered the proposed tax to $20B. That’s still $20B over what it is now.
James – hate to gunk up your argument with facts – but… $20Billion over 10 years is $2 billion/year.
You are aware, of course, that in 2008 the Medical Devices industry had revenues of about $120 billion and an average profit margin of 16.5% (far higher than most other industries) – that comes out to about $20 billion in industry industry profits in an industry characterized by low financial transparency, low inelasticity, and supplier-driven prices. I don’t think that taxing $2 billion out of $20 billion in industry profits so debilitating (especially considering that insuring almost 50 million additional people will lead to a lot of increased business for these guys by people who currently can’t afford their products)
November 4th, 2009 at 1:04 pm
Being innumerate, I’m guessing that you celebrate your good fortune…
Being a selfish bastard, J-Rob, I’m guessing that you whine about how Big Gubmint hasn’t done anything lately for you. Also, aquaducts.
The point about healthcare in the actual developed world is that you don’t have big, vague barriers to entry, where there are so many options where you don’t know what it’ll cost you at the end. So I’m not averse to the whole $X-flu-shot-at-Walgreen’s thing, but that really just papers over the cracks in the American non-system.
November 4th, 2009 at 1:50 pm
Being of good humor today, I am amused by Matt’s repeated assertion that the medical innovation – profit motive link needs no documentation, or for that matter thought. There is a substantial body of data suggesting that profit motives distort and pervert medical practice and research. If I didn’t know that he was a philosopher, and therefore that he has critically assessed all his underlying assumptions, I might think that Matt has a irrational belief in the fundamental “good” of “the market.”
November 4th, 2009 at 2:28 pm
It’s not at all clear that we don’t need innovation in basic healthcare. There are a lot of things that need to be improved in the delivery of healthcare, and some of those require new ways of doing things. Say, for example, preventing central line infections.
November 4th, 2009 at 2:57 pm
pseudonymous in nc: Go Pythons!
November 4th, 2009 at 3:11 pm
The fact that it’s spread out over a period of years does not change the fact that it’s an increased tax on a business that is helping real people. Why the Feds want to punish that sector is beyond me.
November 4th, 2009 at 4:10 pm
Um, Matt, the Public Health aspect of public health care is well known to a lot of these folks.
And the resulting unnecessary deaths of poor black, brown and even white people is a feature, not a bug.
They’d just prefer not to mention it.
But recall that Bill Bennett, I believe, commented that abortions were bad, but *black* people having abortions was good, and I don’t remember the conservatives excommunicating him for expressing the sentiment. So we kind of already know that they would like fewer black people around, and frankly, poor people in general.
November 4th, 2009 at 4:50 pm
My wife works at a local hospital, and part of their health insurance is being paid $50 to have an annual physical with appropriate tests, with no co-pays.
For my insurance, annual vision and twice yearly dental (cleaning and) exams are free.
November 4th, 2009 at 4:57 pm
Taxing the medical device industry isn’t going to hurt innovation. The taxes are only levied when they make a profit, and in this industry, you either make huge profits or huge losses. There’s not much in between for new innovation. Older products become commodities and have much lower margins. The big issue with innovation is risk. You can easily blow through twenty million dollars and find out your product doesn’t work. And what really sucks is that a clinical trial takes at least three years, and the development phase is two years. So you are spending a lot of money for five years on what is basically a guess. If you guess wrong, your company probably goes under. That risk is far more scary than taxes. What makes the biggest difference is a financial bubble bursting. That spooks investors in every industry. They see financial trouble and don’t want to commit to five years of losing money on the hope of maybe getting it back two years after that. You’d think investors would say “okay the housing market sucks, maybe I should move into another industry.” But instead they say “time to move into T-bills.” They simply become afraid to invest in anything with risk. And the medical device field is as risky as it gets.
November 4th, 2009 at 6:09 pm
For everyone upthread who thinks it’s relatively easy and cheap to take care of vaccinating yourself: I had to get a pair of MMR vaccines this year — it was a job requirement because I had never had mumps. My internist told me she doesn’t give MMRs, ’cause she’s not a pediatrician; my local board of health doesn’t give them to adults anymore (cutbacks). So I ended up at a private outfit that mostly give shots to travelers going to exotic places. The pair of vaccines cost me almost $200. Nice work if you can get it, I suppose.
I just read somewhere that Salk purposely did not patent the polio vaccine he developed so that it would be affordable. He was very glad to help save the world from that horrible disease.
November 4th, 2009 at 6:14 pm
I just read somewhere that Salk purposely did not patent the polio vaccine he developed so that it would be affordable. He was very glad to help save the world from that horrible disease.
Which is why there is no billionaire Salk family. And god save him for it.
November 4th, 2009 at 6:15 pm
“If you guess wrong, your company probably goes under.”
The medical device industry gets a lot of criticism for high profit margins. But we don’t factor in the companies that failed. Many products are developed by small start-ups and most of those fail after losing a hell of a lot of money. Without those high profit margins on the products that succeed, no investor would take the risk on these very risky products. And that’s why a lot of small companies do a “me-too” product along with an innovative product. It means the sales reps have a safe product to sell along with an unknown product. All industries have risk, obviously. But medicine has the added risk that we really don’t know what works and what doesn’t. The human body is unbelievably complex and it’s really hard to understand. So you do a lot of guessing. I work in this field, so I know what it’s like. And I know people don’t like to hear that we don’t really understand it, but that’s the truth. And we face the huge issue that what works for one person doesn’t work for another. Consider these four ideas that are well accepted, but aren’t always true. You can only get chicken pox once, you don’t walk if you break the C-4 vertebra, your liver will be damaged if you drink alcohol to excess, and bee sting allergies result in anaphylactic shock. I violate all four of these and I’m just one person. I’ve had chicken pox twice, I walk with a broken C-4, I’m an alcoholic with a pristine liver, and I have the worst RAST test results in recorded history and face paralysis, not anaphylactic shock when stung by a bee. This is why medicine is so hard.
November 4th, 2009 at 6:19 pm
@ Whiskey #1:
That graphic can be found on the Wikipedia page for “antigenic shift”.
November 4th, 2009 at 6:23 pm
Shorter James Robertson: How dare any public employee make more money or have better benefits than someone working at Wendy’s!
November 4th, 2009 at 6:33 pm
“I just read somewhere that Salk purposely did not patent the polio vaccine he developed so that it would be affordable.”
If that’s true, bless him. He did the world a great service. Now if we could just get more people in India to take the vaccine, India would be a better place. And that really gets to the less than free argument. The vaccine is free, and there are many organizations that go around and try to give it to people. Yet enough people refuse it that Polio persists. There’s a point where you really need to force people to take it. I don’t think we’re there yet in India. Working with local religious leaders should work and has in other countries. And the religious leaders are getting on board in India. So I think we should give that a try first. But if that doesn’t work, jailing mothers who refuse to let their children get the vaccine will have to be considered.
And if you wonder why I’d focus on religious leaders, it’s simple. Nobody trusts the government in developing countries. But they do trust their local priest, rabbi, monk, imam, or guru. If they say it’s okay, people will take it. It’s the only thing that worked in Laos. When the Buddhist monks told them to take the vaccine, they did take it. And now they don’t have Polio. And I had a great conversation with an old man in Laos who did have Polio. And he cried tears of joy about how nobody in Laos would ever suffer his fate. And I cried with him.
November 4th, 2009 at 7:14 pm
When the Buddhist monks told them to take the vaccine, they did take it. And now they don’t have Polio. And I had a great conversation with an old man in Laos who did have Polio. And he cried tears of joy about how nobody in Laos would ever suffer his fate. And I cried with him.
Didn’t the Thai government figure out that the best way to get condoms and other anti-HIV measures to the people was thru the Buddhist abbots?
November 4th, 2009 at 7:20 pm
“or have better benefits than someone working at Wendy’s!”
I’m obviously killing any progressive credibility I might have had, but I like Wendy’s. My local Wendy’s used to be one white guy who owned it and a bunch of Mexican workers. Now, one of those Mexicans owns it. When the previous owner was dying, he sold it to one of his employees. And ain’t that America. Some people think that America is a group of people, and some think it’s a subset of white people. But America really is an idea that applies to all people. And all people can live that American Dream. I’m as white and blue blooded as it comes. My ancestors fought in the Revolution. And when I see a Mexican owning a Wendy’s or a Korean owning a liquor store, I see an American. We are the most multi-ethnic culture ever, and that’s what makes us great. America is truly blessed, but only because we let everyone have a chance. Our continued success depends on continuing that idea.
November 4th, 2009 at 7:40 pm
“Didn’t the Thai government figure out that the best way to get condoms and other anti-HIV measures to the people was thru the Buddhist abbots?”
Yes and no. A friend of mine worked in that program (Dr Jeffrey Klausner, now in SF), and they worked mostly with the prostitutes to control HIV. But yes, they really did work with the temples as well. And the Cabbages and Condoms guy deserves a lot of credit too. HIV is really tough to deal with, and it takes a multi-faceted approach. And it’s really tough to get the religious leaders on board with that disease. The Buddhists have been very good with it. And strangely enough, so have the Catholics. Not the leadership, of course, but the local priests have been great. Father Joe in Bangkok has been awesome in his advocacy and compassion. And Father Joe has been so good on other issues as well. I’m not really a fan of the Catholic Church, but I do strongly support the Liberation Theology movement. Father Joe is a great example, but hardly the only one.
And before you criticize Dr Klausner, understand that he revels in controversy. It’s his nature. But he really has done and continues to do great work in HIV. He isn’t trying to earn any love from anybody, he just wants results. And he gets them. And if he has to ruffle feathers doing it, that’s an added bonus. If you knew him, you’d understand.
November 5th, 2009 at 12:00 am
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