Genetic Information, Health Insurance, and "Socialized Medicine
by Maxine Udall
re-posted Maxine Udall Girl Economist with authors permission
Genetic Information, Health Insurance, and “Socialized Medicine”
Brad Delong provides an excellent blog about U Cal’s genetic testing of students and the likely ways in which genetic information would be used by private health insurers, not to manage risk better, but to sort on it better, thereby defeating the ostensible purpose of insurance. Disease prevention and health promotion over the life cycle should and would be the objective of any health insurer likely to bear the costs of all your future illnesses and injuries. Of course, our fragmented US system does not provide the incentives to do this. The system most likely to align short and long term health risk management objectives (and (I would add) to reduce health care costs in the long run) is a single-payer system, which the US is not likely to have any time soon.
The problem with the current system is that if my genes predict a hip fracture at 70, the average private or employer-based plan should have little or no interest in incurring costs to prevent it since they are unlikely to bear those future costs. I will age into Medicare several years before age 70 and the costs will fall to the US (payroll-)tax payer. On the other hand, Medicare and US taxpayers have a real interest in preventing disease and promoting health over the life cycle since many of our (bad health) chickens come home to roost after age 65-67. Those of us who are younger and still working are on the hook for at least some of those costs or will face reduced future Medicare benefits because of their increasing share of national output.
As in the financial sector, private health insurers have offloaded much of the high risk (and costs) in health insurance markets onto US (payroll-) taxpayers, who pay for much of Medicare and Medicaid. These are two programs that became necessary because private markets failed to provide insurance for individuals and families characterized by high risk of medical expenditures: the elderly and the poor (who are often poor because acute and chronic health problems prevent them working). Mercifully, our ethics and our values require them to have access to health care. Hence, we have two government run programs: Medicare for those over 65 and Medicaid for those who are poor children, poor chronically ill adults, poor elderly adults in nursing homes, or poor pregnant women (with some variation in eligibility thresholds across states).
Yet the spectre of “socialized medicine” prevents us moving to single payer, where the incentives for prudent life cycle management of risk across all age and income groups would be better aligned. Why, when we already have what is in effect single payer for the elderly and the poor, do some believe that single payer is “socialized medicine” and why do they fear it so?
I gained some insight into this recently when an elderly relative started complaining about “Obamacare” and how it would lead to “socialized medicine.” Knowing the person had heart surgery courtesy of Medicare and was receiving ongoing monitoring and care, I said, “I didn’t realize you were so unhappy with Medicare.” To which I received the reply: “I’m not talking about Medicare, I’m talking about socialized medicine.”
“How is Medicare different from socialized medicine?” I asked.
“Medicare isn’t socialized,” came the reply. “I pay for it. I pay every month and when I’ve had surgery, I’ve had to pay some of it. Medicare is like any other insurance.”
“Well,” I said, “I know you’re paying a premium for Part B and I know there are copayments and deductibles, but Medicare is a government run health insurance program.”
To which the reply was: “But I’m talking about socialized medicine. You know that whenever the government gets involved in anything, it never does a good job.”
“I had no idea you were having problems with Medicare.” said I. “I always had the impression you were pretty satisfied with it. And with the VA, too. I know you’ve used the VA for some care recently. What problems have you had with Medicare or the VA?”
“Well, none with Medicare or the VA, but I’m not talking about Medicare. I’m talking about socialized medicine.”
“So you’re happy with Medicare?”
“Would you mind if your [adult] children could buy into it? Your son is unemployed. Would it be OK if he could buy into Medicare?”
“Well, sure. As long as he has to pay like I do.”
You were all wondering how someone could say, “Keep your government hands off my Medicare?” Well, there you have it. Now that I’ve told you, I’m still not sure I understand it. It was one of the most frustrating and at the same time enlightening conversations I have had in a long time. The person with whom I was conversing is intelligent, educated, and not senile.
I’m just not sure how to use the above information. I was unable to persuade my elderly relative. I confess that since the conversation, I have despaired that the national conversation will ever be much better
but i don’t need no stinking genetic test to tell i have less risk than someone else. if there is a reason people are poor, besides, you know, the unfairness of capitalism, it is the unfairness of bad health.
now with private coverage, aided by genetic testing, i could probably get insurance at a reasonable rate, and i could teach myself not to notice that poor people were not very healthy, and tended to die a lot sooner. on the other hand, rich people tend to have more expensive illnesses in the end.
as long as health care is really really expensive and everybody wants all the best they can get… and think they have a right to it… we are on a collison course between really really expensive single payer, and a much harder attitude toward the unfortunate.
Buffpilot, you do know you can buy private health insurance and health care in the UK if you want to, right? And that lots of people do?
The other issue that needs to be brought out is how much those of us out in the “real world” are paying for health insurance. My employer, for my little family of three people, was paying $1,800 per month. I was paying $400 of that OOP. That’s to have deductibles on the order of $5,000 a year for the family. You read that right. (Now, with a new employer, they want me to pony up $700 a month for similar coverage. Hah.)
Medicare costs $96.40 a month per person for the basic (Part A?) stuff. Yes, I know all about the prescriptions and such. It’s the same in private land. I pay as much as $70 for an Rx of something that is “brand name” and still under patent.
So, yes, grandma, you’re Paying For It. But look at the Deal you are getting compared to the rest of us. And, you’re old and expensive. Imagine how less expensive it would be if those of us who are young and healthy were paying in.
This conversation also works with RW relatives who enjoy Public Employee benefits at a fraction of the costs the rest of us have paid for decades, yet still insist on listening to Rush Limbo rail about “teh unions” and Obamacare and so forth. Sometimes during the conversation, you’ll hear things like “I had no idea how little we’ve been paying all these years.” Trust me, it’ll be worth it.
: (see the UKs health system)
I’m not sure what you mean by this. I’ve had two experiences with the UK health care system. Both were for minor emergencies with my younger son, who does not travel well. Both were quick and efficient, and neither cost me anything out of pocket, even though I had no health insurance in the UK. An equivalent emergency in Boston, with one of the Cadillac health insurance plans McCain hates so much, would require a $500 co-pay and several hours of waiting in the emergency room for the gunshot and knife wound victims. I will admit that triage would place them higher than our emergency. The fact that we have a lot of those is an indicator of something else broken in our economy, perhaps.
FWIW, my Cadillac health care plan, on which the Rs want me to pay taxes, has the highest subscriber satisfaction in the country. That is to say, subscribers to my HMO plan say they are, on average, happier with my HMO than other subscribers say they are happier with their HMOs. It still takes me six weeks to get an urgent care appointment.
That facilitates only the rich anyway! The point is the more that are added in the worse the care, worse the choice, worse the cost!
“On the other hand, Medicare and US taxpayers have a real interest in preventing disease and promoting health over the life cycle since many of our (bad health) chickens come home to roost after age 65-67. Those of us who are younger and still working are on the hook for at least some of those costs or will face reduced future Medicare benefits because of their increasing share of national output.”
And there it is! The entire point of everything that has to do with the HCR debate. Typical liberty hating Idealist Collectivist with no shame pushing their Social Engineering fantacies on the rest of us….Pathetic!
What part of “The American people reject Single Payer Health Care” don’t you get?
It’s not clear to me that it’s clear to some of you
that “the young” who are paying for granny’s Medicare are just a surely paying in advance for their own.
Even though insurance companies like to think it terms of “what is the risk that you will get expensively sick this month and therefore what is the price we have to charge to cover that risk, the whole thing works because over a lifetime the “average person” pays in more in premiums than he costs in medical bills.
The only difference wtih Medicare is that it is explicity designed to collect your money now for bills that you will incur after the age of 65 — after you are no longer working.
This is important, because as long as you think of it as “the young paying for the old” you will miss the entire point and be easy prey for the confusers who want you to be mad at granny and completely forget that some day you will be one of “the old.”
most of the people here seem to have sense enough not to engage you. but this is just a friendly tip: what you have written here makes no sense at all. it’s not that you are against single payer, it’s that you haven’t said anything that adds up to a coherent thought.
not that the quote you cite is much more coherent.
let me rephrase the point of that: Because taxpayers are paying for Medicare, those taxpayers have an interest in reducing the costs of medical care in old age by promoting the health of young people whose poor health will not become expensive until they are old enough to collect Medicare.
Jimi’s idea that this is “liberty hating” seems to be founded on the idea that we should simply let people take care of themselves, so that any otherwise curable illness becomes fatal simply because they lacked the money to pay the doctor at some point in their lives.
My take on this is that if we could ship Jimi and fellow Libertarians off to Liberty Island where they could practice this “philosopy,” I’d be all for it. But meanwhile I think I prefer the system of mutual aid that has gotten humans through the last three million years, even at the risk of having to put up with the modern form that takes, however threatening to my solipsist fantasies.
The American people do not reject “single payer.” The congressmen paid for by the insurance industry reject single payer. And the usual thirty percent of the people who can be fooled all of the time.
Black – Yes I do. Sorry if not a perfect example.