Health care is turning into a consumer product

I realized after double checking that it was actually a 1942 Roosevelt bill, and they were trying to figure out how to keep a lid on rising prices during the war. It's also not uniformly good if prices also rise quickly. Inflationary spirals are real, and very bad for regular people.

> Was the AFL pushing for employer-based and the CIO pushing for national?

I'd have to double check.

> It’s virtually impossible for an average person to learn about the history of the American labor movement.

A bunch of this stuff is available in more popular history and online now. "The Devil Is Here in These Hills" is supposed to be good, but I haven't read it.

Amazing what a little competition can do. The city was smart enough when the competitor moved in to install the capacity for more ISPs to utilize the existing conduits in the future.

There are probably ways that we could combine aspects of greater and lesser privatization to achieve the best of both worlds. I have some thoughts that I've been mulling around for a while:

1. Expand the government to achieve universal healthcare coverage.

-- a. ACA public option.

-- b. A conservative UBI, with the twist that uninsured individuals would be automatically enrolled in the public option and have their premiums taken out of their UBI. (Tangentially, for similar reasons, also pay out a portion of each UBI disbursement in the form of food stamps rather than cash.)

2. Shrink the government and quasi-public entities (insurance providers) to unshackle the invisible hand.

-- a. New regulation to ban copays and set a mandatory floor on deductibles (say, $10k). While major emergencies still need to be covered, and while there still needs to be an entity in between the patient and provider eating the risk of non-payment, it's also desirable from an efficiency perspective for patients to be kept aware of the costs of their care — and therefore incentivized to select more cost-efficient options. The market would then naturally find a more reasonable equilibrium without the need for price fixing, in theory.

-- b. Set up a system of tax deductions and credits for out-of-pocket medical costs. (Preferably such that the poorest would have their costs fully covered in most or all cases, depending on what's fiscally realistic.) This must strike a balance between non-disruption of market forces and ensuring that the poorest in society aren't shy about seeking the care they need. My thinking is that the annual nature of tax filings would be enough to address the former, as patients would still be be out of pocket for up to a year waiting on their refunds, representing an opportunity cost that would be difficult to ignore. To address the latter point, set up a standardized/regulated process for the insurer to send the patient something resembling a credit card bill, which they could pay either up front or up to a year later with accumulated interest.

Parts 1 and 2 are essentially unrelated, and could hypothetically be implemented independently of each other. However, #1 on its own doesn't attempt to address the efficiency issue (thus saddling the government with even greater new expenditures), and #2 on its own doesn't address what happens or who gets left holding the bag when an uninsured patient can't pay their bill (which wouldn't be an issue with truly universal coverage).

I also have a lot to say about what the state should and shouldn't be doing to maximize the general health/nutrition/fitness of the population, but we can leave that for another post :).

> Market is a fine fit for every healthcare need that doesn't start with a trip to the ER which is the overwhelming majority of healthcare dispensed in the US.

I think most people are interpreting this as “market is a fine fit for every healthcare need [except for those that start in the ER] which is the overwhelming majority...”

I.e. that you’re advocating the market for the majority of healthcare rather than the majority.

I think your actual recommendation is the opposite. Maybe this would be clearer if you just laid it out like, “Most healthcare is non emergency, cost is a primary concern which insurance makes worse, markets are good at solving cost issues.”

Responding to your actual argument, however, I see many people claim that insurance companies are taking a “fat cut”, but I see very little evidence of higher than expected ROI/ROE in Aetna / United / etc. (ref: United’s net margin is ~5%, ~15B in net income on 300B of revenue). ROE is ~20% which doesn’t seem ridiculous for an insurance business.

The bigger problem seems to be personnel spending in healthcare (admin, support staff, billing), and generally a systemic culture that’s not even knowledgeable about what prices they charge, let alone price conscious in the services they deliver.

A better hybrid public/private system would be for the government to put out bounties for companies to run large studies on research that looks promising, to determine effectiveness and optimize formulations. In return for paying for the research, government would get the patents. Paying for drug development with a patent reward only encourages deceit and high prices.

Dean Baker has explored this extensively, and is posting steadily about it recently:

The basic idea of government-funded research should not be hard to grasp since the government already funds a large share of biomedical research. The National Institutes of Health gets over $40 billion a year in federal funding, with the Biomedical Advanced Research and Development Agency (BARDA) and other government agencies getting several billion more. This puts the government’s total spending in the $45 to $50 billion range, compared to a bit over $90 billion from the industry. So the idea that the government would fund research really should not be that strange.

Most of the public funding does go to more basic research, but there are plenty of instances where the government has actually funded the development of new drugs and also done clinical testing. But under the current system, most of the later stage funding does come from the industry and is funded through patent monopoly pricing. Relying on open-source government-funded research for later-stage development and testing would be a major change.

To my view, the best way for the government to support the development of new drugs is through long-term contracts (10-12 years), which would be awarded through competitive bids for research in specific areas, like cancer or heart disease. The plan would be that the contracts would be relatively large, with the idea that the winners would be comparable to prime contractors for the military.

https://www.cepr.net/more-on-open-source-versus-patent-monop...

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Getting Ready for the Next Pandemic: Can We Get Patent Monopolies on the Table?: https://cepr.net/getting-ready-for-the-next-pandemic-can-we-...

Financing Drug Research: What are the Issues?: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1134983