Three data points on liberal opinion of Cuban health care

Topics: Health
22 Feb 2007

From: Ervan Darnell









Two well-known liberal blogs (just the first ones I came across) had
good things to say about Cuban health care:

TomPaine.com

And did the system provide that promised better
way of life? It can be
said that during the years of the Cuban-Soviet alliance, when Cuba
enjoyed most favorable terms of trade with the Soviet Union, resulting
in what amounted to a subsidy of five to six billion dollars a year,
the Cuban people were indeed well off. They had free (and
excellent)
health care
, education up through the post-graduate level, adequate
housing, enough to eat, and various other benefits. Then came the
collapse of the Soviet Union and the end of Cuba’s subsidy. Cuba went
through some very difficult years—years of serious shortages of almost
everything—of 18-hour-a-day blackouts and other difficulties.


http://www.tompaine.com/articles/2007/02/02/castros_legacy.php


Alternet.org:
Jim Hightower (well known liberal, though surely left of even the
Democratic middle):
America's "CorporateCare" system fails on the
most basic measures of
health. For example, babies born in impoverished Cuba have a better
chance of survival than babies born here. On average, 77 babies die
every day in the United States -- an infant mortality rate that,
according to the CIA World Factbook, ranks us way down at No. 42. At
the other end of life's span, our people can expect to die younger than
those in 34 other countries -- including Cuba, Andorra, Luxembourg, San
Marino and, yes, Slovenia.

http://www.alternet.org/envirohealth/37624/

By way of rebuttal, Hightower's facts are in doubt ([1][2]), he's
sampling tiny differences of a few months or a few children, and life
expectancy does not measure quality of health care only but other
things (like youthful casualities in the drug war bringing the average
down). Similarly, infant mortality goes up with the teenage pregnancy
rate (caused by welfare if you think Murray credible) and drug
addiction. Whatever one makes of those issues, they are not the fault
of the health care system.


A third one, which has some credibility, by virtue of being selected
by the News Hour for an interview:
"Center for American Progress":[3]
Rather than dismantling our current system and
starting from scratch,
the Center’s plan builds on the system’s strengths while responding to
its serious shortcomings. [...]. Accordingly, we propose
to help pay for the investments necessary to improve access,
affordability, and quality through a small value-added tax, the
revenues from which will be dedicated exclusively to health system
improvements.

which is more in line with what Clive said. But even so, I don't see
that it's substantially better.

First, they didn't say whether or not they would allow private doctors
to stay in business. To me, this is the significant difference
between more moderate reform to try and insure some basic level of care
and outright socializing the system.

For test of it, I cannot imagine how this comes out much better than a
complete government take over. Start here:
We recommend supplementing the employer system
with a new health insurance pool, modeled on the federal employees
health insurance system, [p. 5]

If the government is going to pick up the insurance tab, why wouldn't
any company want to? Either this means that the government "insures"
everyone or that employers are forced to. If the former, insurance
companies are immediately dealt out of the system and the government is
making all provision decisions. If the latter, then companies will
still try to dump on the default government plan and the response will
be to force them to provide a certain level of insurance, which is to
say nothing but a tax that feeds back into the government pool system.
This is the same outcome except it's a hidden payroll tax instead of an
income tax.

"Center for American Progress" denies this obvious outcome as part of
making their plan seem less radical: "we propose filling the gaps
between these two primary sources [medicare and employers]." They also
went on to say that Medicaid eligibility should expanded, maybe that's
their confession after all that "supplementing" the current system
won't work.

Maybe companies will offer better health care coverage than the
government default, but this is back to my question 1: will a private
market be allowed to exist outside of the government one. If one does,
great, but that part beyond the mandate is not the issue here. The
question is does the mandated part help and does it really matter how
it's done.

I'm reminded of Edison, the company that government schools were
outsourced to. The government disingenuously called this
privatization. I almost wonder if that was a deliberate lie like in
the case of California electricity "deregulation" just so the certain
failure could be blamed on free markets instead of regulation. But, I
digress. The point is that there was still no choice on the customer
end, no demand elasticity to offer a better product, no real
competition. Edison has made little or no improvement. There are two
reasons:
1) They are saddled with all of the same regulatory burdens and
bureaucratic overheads as the government schools.
2) Politics trumps business: "Much of the opposition to the proposal
came from the local teacher unions, which vehemently campaigned against
Edison. " [4] That is they had not only deliver the product, they had
to have enough extra money to fight off political hostility in the rent
seeking market.

I expect government run health care to be the same. It's hard to
imagine that privately contracting for services will be much different
than the government running the hospitals/clinics directly.

I'd like to see a good analysis into why prices are really rising (not
merely high, but rising). I know of three reasons:
1) "health care" is moving target. We really are consuming more health
care than we used to because modern technology offers us more things to
consume. It's like talking about the audio/visual crisis because
people spend more on HDTV than they did 10 years. Well, duh.
2) Defensive medicine, i.e. needless work done to defend against
lawsuits. Perhaps this category is not rising, but merely high.
3) Forced transfer, e.g. subidized ER care and sub-market Medicare
rates simply force more cost onto everyone else. These don't change
the aggregate (much), but they do change the per person insurance cost
(and that's quoted as part of the "crisis"). And, this part is getting
worse because it's a positive feedback cycle of fewer people buying
insurance as it becomes a worse deal as it covers more of other's
people health and then the newly uninsured demanding more government
subsidized care.

"Center for American Progress" (I suppose that's like "deregulation" in
the naming) doesn't say anything about these issues or any real cause
of the rise in health care costs. It does claim that the problem is
that insurance is too expensive. It's the same irony as the
Schwarzeneggar plan: they claim that medical care is too expensive (as
witnessed by people not buying insurance) therefore people must be
forced to buy it (via a payroll tax mandated on employers to buy
insurance). What's their plan for cutting costs: 1) "preventive
health care", 2) research on clinical effectiveness, 3) "making better
use of health care information and information technology;" 4) "and the
productivity and other economic gains from a healthier population."
This is a fantasy. Insuring more people with lower
deductibles/copays/consumer choice is a prescription for driving prices
higher as the demand side is completely insulated and the supply side
left unfettered. Price fixing is the only possible outcome of that.
Taking their claims in turn:

1) Most preventive health care (e.g. vaccines) is already cheap and
people consume as much of them as is sensible. Health plans already
cover routine expensive testing, e.g. colonscopies for early cancer
detection.

To the extent their remains a disincentive problem with employer
provided insurance (which is true), the answer is not more regulation,
but less: get rid of the special tax treatment employers receive so
individuals are properly incentivized to buy private insurance, which
they will keep longer and thus be more interested in preventive care,
if it's truly rational.

The argument for preventive care is oversold in any case, just like the
no smoking case. Saving people from one cancer only lets them die of
another, which will be just as expensive as the first one would have
been. I'm not arguing for Logan's Run here, but only pointing out the
CFAP accounting is bogus.

2) More research: okay, sure. But this helps no matter which medical
system we choose. It's not an argument for a government take over.

3) "more technology", sure. This is just like (2). Well, no, it's
even lamer because private companies are incentivized to invest in more
technology in a way that government bureaucracies are not. If they
want more technology, their plan will destroy it.

4) Evidence is sorely need here. The number of people disabled from
work who could be returned to work with more medical care (than we
currently dispense) during their working years is tiny. Most costs are
for retirees where productive work is no longer a question.
Regardless, it's a flight of fancy to think that increased productivity
will cover the cost increases that would occur if we implemented their
plan without rationing.

My bottom line on CFAP is that it's hard to imagine how a moderate
approach, which covers everyone, can ever be anything but an extreme
approach. Yes, private medical care migth still be allowed to exist
(let's hope so), but that's incidental to whether the part that is run
by the government would be any different under a moderate versus more
socialist proposal.


[1]
http://www.savethechildren.org/newsroom/2006/a-mothers-day-report-card.html
[2] http://geography.about.com/library/weekly/aa042000b.htm
[3]
http://www.americanprogress.org/projects/progressivepriorities/health.html
[4] http://www.mackinac.org/pubs/mer/article.asp?ID=3412




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