Quote of the Day
"It is amazing that people who think we cannot afford
to pay for doctors, hospitals, and medication somehow think that we can
afford to pay for doctors, hospitals, medication and a government
bureaucracy to administer it."
CARPE DIEM
Professor Mark J. Perry's Blog for Economics and Finance
Monday, April 23, 2012
About Me
- Name: Mark J. Perry
- Location: Washington, D.C., United States
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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42 Comments:
"The people made worse off by slavery were those who were enslaved. Their descendants would have been worse off today if born in Africa instead of America. Put differently, the terrible fate of their ancestors benefitted them."
Thomas Sowell
suggested background music: Monty Pythons' "Always Look on the Bright Side of Life"
Counter-Point:
"It's AMAZING that some folks like Sowell apparently believe we don't ALREADY pay for health care via the govt via - EMTALA, MedicAid, MediCare, TRICARE AND the VA"
About half of the folks in the country receive that nasty old govt healthcare.
"About half of the folks in the country receive that nasty old govt healthcare"
yeah, the half with the more out of control costs and dropping service levels.
i think you are making his point for him lar.
Amazing places like Canada are able to do so. I'm not saying it's perfect, but then again neither is ours.
canada? their system is terrible (and failing).
they have just substituted waits for money.
why do you think so many canadians come here when they have a serious health issue?
waiting 6 months to see s specialist is not a sign of a successful healthcare system.
there is no "perfect" system, but i'd take the us system over canada any day.
also:
canada is a massive healthcare free rider. they develop nothing. not drugs, not procedures, not new treatments, not new devices.
they rely on the US to do that and to treat their difficult cases. that's what you get when you ban private care: stagnation and mediocity.
if we all ran our systems like canada, there would be no aids drugs, no mri's, etc.
someone needs to push healtcare forward. for the most part, that is the US.
Morganovich;
You're Canadian?
You have experience with the system?
I'm speaking from experience. I lived there 8 years. I watched my Canadian wife go through the system
with a tumor on her spinal cord. Out of pocket - $0.
As I said - it isn't perfect, but "failing"?? - I would say only in the eyes of the mmisinformed.
Quote from Moe: "Out of pocket - $0."
I think you just proved morganovich's free rider argument.
Free rider argument???
serious?
it's called taxes - Canadians pay for it.
morganovich: canada is a massive healthcare free rider. they develop nothing. not drugs, not procedures, not new treatments, not new devices.
Canada has made important advances in many areas of medical science, including stem cell research—certainly cutting-edge by any standard.
http://www.lunenfeld.ca/researchers/nagy
Canada, even though it has a relatively small population, has the ninth largest research and development expenditures (PPP) by country.
Battelle, 2011 Global R&D Forecast.
Canada has some of the foremost research hospitals in the world, such as the Samuel Lunenfeld Research Institute
http://www.lunenfeld.ca/
"Out of pocket - $0." -- Moe
"it's called taxes - Canadians pay for it." -- Moe
moe-
you trot out the "you're not Canadian argument" then try to object to a free rider argument that you clearly did not understand?
a girl i dated moved to the us from canada because she could not get health care there. if you have anything unusual go wrong and need ongoing treatment from specialists (as with a thyroid issue) canada will drive you into the ground.
further, where to you think the detection technologies, surgical procedures, and medicines your wife got were developed? that's the free rider issue. it sure was not in canada. devoid of profit motive, Canada relies completely on the rest of the world for medical innovation.
if we all used that system, there would be no innovation at all. we'd still be using leeches.
the canadian system is a free rider on those that do spend money on innovation and provides slow, mediocre care for high taxes.
i suggest you read gratzer's excellent book "code blue".
the wait times are nearly triple the clinically reasonable measures set out in their own guidelines.
http://www.usnews.com/opinion/blogs/peter-roff/2009/07/28/statistics-show-canada-healthcare-is-inferior-to-american-system
you may think a 17 week average wait for care is OK, but most of us would never want to put up with that.
but that's what happens when you price below cost, you get rationing.
even claude castonguay, the father of the canadian system admits it is failing and need to become more free market.
zach-
you have to be kidding.
you cite 1-2 things and pretend canada has a healthcare science industry.
i do biotech investing for a living. there is NOTHING going on in canada. it's damn close to a zero.
hilariously, you then take the lunenfled hospital, funded from outside by mount sainai and try to use at as an example of NOT being a free rider? the canadian system does not and will not pay for much of what they do. they will not pay for unapproved or experimental. that's all funded from outside. stem cells are a special case as the US is so draconian and stupid about them that it is difficult to do research here, but those products are sure as hell not intended for the Canadian market. canada will not pay for them.
you are trying to twist the facts here and misrepresent the situation.
try searching for canadian drug development, drug trials, etc. you're going to find very, very little. all they do are generics based on the work of others.
It's true that Canada is a massive "free rider" when it comes to medical innovation, but so are the rest of the socialized systems. At least the incentives of the Canadian system and Canadas immediate proximity allow us to do a little "free riding" ourselves:
We were surprised to learn this month from the Canadian Medical Association Journal (CMAJ) the extent of the doctor drain to the United States. One in nine Canadian-trained doctors -- including one in five specialists -- is now practicing in the United States. We suspected the number was high, but not that high. No wonder there is a shortage of doctors in Canada, and nearly two million of us are without a family physician.
It's also not hard to see the underlying cause of the exodus: socialized medicine. The exodus began in the mid-1980s, coinciding with the passage of the Canada Health Act (CHA), which all but outlawed private care, forbade user fees and banned extra billing by physicians. Fed up with government-monopoly health care, many voted with their feet. The CMAJ authors (Robert L. Phillips, Jr., Stephen Petterson, George E. Fryer, Jr. and Walter Rosser) conclude that about 12,000 Canadian-educated physicians are now living in the United States.
As the authors point out, "this is the equivalent of having two average-sized Canadian medical schools [out of a total of just 17] dedicated to producing physicians for the United States," every year for 25 years.
National Post
So, Canadians are freeloading off the U.S. system because all of the innovations in medicine come from the U.S.?
And this "freeloading" is costing the average U.S. citizen how much?
How much is it costing our Government?
What do we owe other countries whose technologies we use?
"The average Canadian family pays about 48 percent of its income in taxes each year, partly to fund the health care system. Rates vary from province to province, but Ontario, the most populous, spends roughly 40 percent of every tax dollar on health care, according to the Canadian Taxpayers Federation.
The system is going broke, says the federation, which campaigns for tax reform and private enterprise in health care.
It calculates that at present rates, Ontario will be spending 85 percent of its budget on health care by 2035. "We can't afford a state monopoly on health care anymore," says Tasha Kheiriddin, Ontario director of the federation. "We have to examine private alternatives as well."
The federal government and virtually every province acknowledge there's a crisis: a lack of physicians and nurses, state-of-the-art equipment and funding. In Ontario, more than 10,000 nurses and hospital workers are facing layoffs over the next two years unless the provincial government boosts funding, says the Ontario Hospital Association, which represents health care providers in the province."
http://www.cbsnews.com/2100-204_162-681801.html
if you think the system works, wait 15 years and see how you like it then.
costs are exploding and service is deteriorating. sure sounds like par for the course socialism to me.
Paul Krugman asks Canadians how they like their health care system.
I am Canadian and live in the US. I watched my mother die waiting 8 months to have surgery on her cancerous Kidney because they didn't have any operating rooms available.
If you believe the Canadian HC system is even remotely close to the US HC system then you are either completely ignorant or a hyper partisan.
I wonder how much "free" HC the Canadians would have if they had to devote a normalized amount of their budget to defense? Not only does the world sponge off of American technology advancements they also benefit immensely from operating under their defense umbrella. Especially Canada.
I have to give credit to the leftist media though for attempting to shine that turd. It really is amazing how anyone could fall for it but a good chunk of this electorate also believes in free lunches - so I guess they are in the wheelhouse.
Wait 15 years and see how many Americans can afford healthcare at its current inflation rate.
moe-
i'm not saying you are taking money out of my pocket.
i'm saying that, like the mooch friend who gets a ride to work, you'd be walking if i had not spent money on a car.
if we all behaved like canada does, we'd still be using leeches. it's rank hypocrisy to try and present your system, which is totally dependent on others for innovation and progress (and still cannot fund itself) as superior when it could no possibly stand alone.
if canada disappeared, us healthcare would not even notice.
if the us disappeared, canada would be bereft of innovation and stagnate.
rather than trumpeting your "amazingness" you really ought to just say thanks for the ride and pipe down. you did not get yourself to work and ought not to speak like you did.
ps.
see you in 15 years when your system has completely failed. (see article above) i suspect you will be the one next to me in line at a us doctor's office assuming you can pay for it after the taxes you pay for the system that failed you.
But the star of the press conference may have been Shona Holmes, a Canadian who had to travel to the U.S. to get a life-saving and sight-saving diagnosis of a brain tumor that was causing her to go blind ... She was forced to leave Canada for a “timely diagnosis,” along with 24 other people during that same month who crossed the border to access the U.S. health care system for brain tumors. Canadian health care, it seems, is not the nirvana it is made out to be by U.S. liberals. As Holmes explained, one in six Canadians do not have a primary care doctor. She could not obtain a simple blood test because the government mandates lab hours and her schedule could not be accommodated.
She continued with a litany of facts. Two premature babies born in her town could not have received adequate care; one was taken to Buffalo and the other seven hours away to Ottawa. The government tries to adhere to “targeted wait times” to access doctors but “they are never near the targets.” Prescription drugs, eye exams, and casts and crutches, to name a few items, must be paid for out-of-pocket in the supposedly “free” health care system. And if you want to see an ophthalmologist the wait is a year.
-- Pajamas Media
Canadian Health Care: a True Story
First, do you even know which way, directionally, the Canadian HC system is going? they are moving to a higher level of private services because the system is a complete failure. They are NOT becoming more statist.
Second, do you think Americans will be willing to pay 45%+ tax rates to fund a minimal level of HC? Yeah, me neither.
Third, you act like this is the only alternative. There are many free market reforms that can reduce the cost of HC in this country.
Fourth, I look forward to the day (of course it won't be happening now when the SCOTUS comes back to us) when an American is told that there are no doctors to see them OR if there are doctors to see them it will be a 3 month. That will be fun to watch, no like this culture is entirely based on an entitled service mentality.
Seriously, I have no idea what world liberals live in but it certainly isn't the same as mine.
Who is saying the Canadian system is superior?
I had to go back to my original comment and found where I may have thrown you off - I meant;
It's amazing, places like Canada...(not Canada is amazing - sorry)
Morganovich,
The problem with your friend mooching a ride analogy - he's costing you only because you consent to give him a ride - you could just say no. And, if he is going the same way you are, what's the cost/
As far as innovation - do I get a discount or not have to pay for proceedures "discovered" in the U.S.?
As a pateint - how does it matter to me where things are discovered - I'm still gonna pay for the service.
morganovich: you are trying to twist the facts here and misrepresent the situation.
Huh? Stem cell research, advances in DNA sequencing technology, epigenetics, and constructing bioartificial organs are all important areas of medical research that Canadians have made recent and significant contributions. These contributions don't go away because they don't fit your preconceptions.
moe-
you are still not getting this.
the whole point i am trying to make is that the canadian system is not paying for its real costs.
it gets a free ride by waiting for us drugs to go off patent and using generics and by copying devices and innovations paid for elsewhere.
if it were a standalone system, unable to do this, it would cost a great deal more to get to anything like the level of innovation that exists. note, this is not exclusive to canada. almost every health system int he world is a net beneficiary of US innovation. canada is, however, a particularly strong example.
not that even with this huge tail wind, the system is going to be bankrupt in 15 years.
you are the one that said "amazing places like canada are able to do this".
far from being amazing, it's a going to go BK even with a huge tail wind.
zach-
you are just grandstanding and taking one small research effort and pretending its an industry.
canadian biotech is a wasteland and their medical innovation insignificant.
if every single canadian research program disappeared overnight, you would not even notice.
you are trying to take one tiny set of programs (paid for by non canadians) in a special case area where research has to be done outside the us (due to our stupid laws) and pretend they represent a whole industry that does not exist to fit your own preconceptions.
unlike you, i actually know a great deal about where biotech and medical research is done. you just googled "Canadian medical research" and linked a couple things you found to try and pretend you have knowledge.
however, you have, based on misinterpretation of non representative info come to utterly inaccurate conclusions.
the (publically funded) cdrd is the big driving force in canda and it produces damn near nothing.
that's what happens when you refuse to let drug companies recoup the risk adjusted research costs of development.
perhaps you would be so kind as to provide me with a list of major drugs developed in canada since you seem to feel they exist.
seriously, try finding some. the experience will be educational for you.
hint googling "drugs developed in canada" is not going to get you anywhere. note that the TSX has virtually no healthcare companies in it and that the combined annual revenues of the only 2 (out of over 200 stocks in the tse) that do research is about $1 billion, less that the WEEKLY revenue of pfiser. pfiser does in 6 days what the 2 biggest canadian cos do together in a year.
the entire canadian healthcare research system, public and private, would not make one good sized drug company.
"it gets a free ride by waiting for us drugs to go off patent and using generics and by copying devices and innovations paid for elsewhere.."
Most U.S. citizens wait for drugs to go generic and then use them - Is there a point you're trying to make or just like to argue?
In your example it's the generic drug companies that are "freeloading" off the brand-name drug companies.
Morganovitch:
One More Try:
The population of Canada is roughly the same as one U.S. state:California. To assume it is a drag on U.S. healcare costs or anything else is ridiculous.
Canada is freeloading the same way third world countries are getting a free ride as far as telecom goes. They don't have to lay thousands of miles of wire and dig holes for poles like we once did - they can skip right to cell phones.
Please explain to me the problem with this.
Freeloading is someone who taps into your electric supply and steals service, thus costing you money. How is Canada adding to U.S. healthcare costs?Simply bashing it because it is not a drug innovator seems quite pointless.
Anyway - I respect your opinions and thank you for keeping it civil.
with respect, the equation in the quote is misrepresented. The professor seems to forget to add the bureaucracy of insurance companies to his original assessment. Substituting one bureaucracy for another brings the equation much more in balance. It's interesting that single payer is the argument when all the PPACA did was force people to be a part of private healthcare.
Bobby Caygeon
Canada is under our U.S. defense shield for one reason and one reason only: because of their monstrous natural resources and commodities. Not out of the goodness of our hearts.
moe-
you really do not get what i am trying to say.
i do not know how to say it any more simply, but will try one more time.
i am not claiming canada is a drag on the US. what is it going to take to get that through to you?
i am claiming that canada is a big beneficiary of research done in the us and that without it, the canadian system would be either much more expensive or far less modern.
canada gets almost all its medical innovation from abroad. it's system is only modern because of work done elsewhere.
this is a big cost savings for them. yet even with it, they have severely rationed care on an unsustainable price trajectory.
in 15 years, the system if left as is will go BK or have wait lists of 9 months to see docs and be useless.
telcom is not the same thing.
sure, a 3rd world country does benefit from the tech elsewhere, but they also have to pay for it.
they buy from the guys who invented the products.
drugs are generally very cheap to make and very expensive to develop. the price reflects the development costs.
canada, by deliberate policy, refuses to pay it. they wait for patents to expire and make the drugs themselves. thus, their costs never reflect the development costs.
this is not like a developing country buying a cell tower from lucent.
this is like a chinese company taking the code to an old version of windows and selling it themselves.
would you call that free riding?
sure sounds like it to me.
"i am claiming that canada is a big beneficiary of research done in the us and that without it, the canadian system would be either much more expensive or far less modern>"
I can agree with that. Every country in the world owes something to U.S. innovation. There's a simple analogy - "The pioneer gets the arrows, the settlers get the land". That's just the way it is in this world.
Canada is a gnat on the U.S. elephants back - slamming them due to lack of innovation is quite humurous to me. They have the freaking GDP of California - what do you want them to do?
Let's say Canada does wait for generic release and NEVER buys brand name -(please provide a source for this, because I do not believe it)...that sounds like sound fiscal policy to me...never pay full price if you can help it...where's the rub?
China is who you need to bite - Canada is an afterthough compared to China.
And as I stipulated earlier - my statement was not intended as "Canada is amazing.."
Both systems have pros and cons - neither are perfect and in recent years, both are strained due to aging populations.
They have the freaking GDP of California - what do you want them to do?-
Moe, I think they are roughly the size of CA (population +/- million) but their GDP is 60% of CA.
moe-
what i'm saying is that to describe them as "amazing" because of their health system is just plain wrong. you are the one who made that claim.
if i own a railroad and you jump onto a car and get a free ride, it might not cost me anyhting but for you to then claim "travel is cheap" is pretty disingenuous.
i think your claims about canada's system are similar to that.
canada's whole system is designed not to innovate. it deliberately makes it all but impossible. that's single payor for you. you compare it to california, but they create not 1% of what california does in terms of new healthcare. there are individual companies in california that innovate more than all of canada in drugs. be careful the comparisons you draw.
my point is that i think you are wrong about "amazing places like canada being able to" run such a health system.
they aren't.
it's system that could not stand alone.
if we all used it, we'd still be using leeches.
further, it is neither a cheap system nor a good one. canada spends over 10% of gdp on healthcare and gets 4 month waits to see docs even with all the free innovation they get and are 15 years from total bankruptcy.
thus, your claims that amazing places like canada are "able to do so" are just not true.
canada's health system is a failure. generally, you can get 2 of "good, fast, cheap". it's not clear canada even got one and it's going to get a lot worse over the next 15 years.
they are not "able to do so". they tried and failed and the costs in terms of forthcoming human misery are going to be dramatic, or do you really think ocamnada will be able to spend 80% of all tax income on healthcare by 2035 as projected?
canadians love to love their healthcare system, but damned if i can see why. i'd never want to use it and it's appallingly expensive and slow compared to the cash pay systems of places like singapore. everyone has an hsa, they save, they spend. they get catastrophe insurance. the results are good, so is the service, all for not even 25% of what canada spends in terms of gdp, oh, and it's solvent.
personally, i'd prefer not to have government mandates for savings and have it all be optional, but it beats the pants of canada - better, faster, and cheaper.
taking user pays out of any system breaks it irretrievably. the us system has serious problems as well, but the come from too much, not too little government involvement.
That was unworthy of sowell. He can do better.
As I understand it, Singapore has a mandate, too.
In the fifteen years it takes the Canadian system to go bankupt, how many million personal bankruptcies will the American health system cause?
morganovich: canadian biotech is a wasteland and their medical innovation insignificant.
We pointed to significant advances. Another advance is the Edmonton Protocol for type 1 diabetes.
If your point is that Canadian research lags the U.S., well sure. Canada is a small country. But it isn't necessary to exaggerate ("wasteland") to make your point. If anything, the U.S. siphons off Canadian investment in doctors and researchers by inducing them to move the sunnier climes.
Moe,
"Let's say Canada does wait for generic release and NEVER buys brand name -(please provide a source for this, because I do not believe it)...that sounds like sound fiscal policy to me...never pay full price if you can help it...where's the rub?"
Where's the rub? The rub is that Canadians can't have the latest lifesaving treatments available, without traveling to the US and spending their own money on the latest brand name medicines. But, what the hey, it's good fiscal policy.
"So, Canadians are freeloading off the U.S. system because all of the innovations in medicine come from the U.S.?"
Canadians aren't "freeloading", they are "free riding". Exactly as morganovich described with his ride to work, and hop on the train examples.
Z: "If your point is that Canadian research lags the U.S., well sure. Canada is a small country."
Yes, and as morganovich correctly points out, California is a similar small country, but with many times the amount of medical R$D and innovation. That wasn't a very good response.
"But it isn't necessary to exaggerate ("wasteland") to make your point. If anything, the U.S. siphons off Canadian investment in doctors and researchers by inducing them to move the sunnier climes."
You're funny. providing greater opportunities for doctors is known as "siphoning off", eh?
Perhaps there's something wrong with the the Canadian model of investing in something that doesn't provide an adequate return, but we suppose government investments are often that way as it's only the taxpayer's money being spent.
Would a commitment of 7 years indentured servitude in exchange for medical training help keep Canadian doctors down on the farm? What do you think?
It's OK to admit you have lost this one.
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