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The U.S. Health System: The Rest Of The Story



March 19th, 2009

Here is a paper with as many as 100 references that you almost never see cited in Health Affairs, or in the Journal of the American Medical Association (JAMA), or in the New England Journal of Medicine (at least not in their public policy articles). In fact, if you are a regular reader of these publications, I think you are going to be very surprised.

My colleagues Linda Gorman, Devon Herrick, Robert Sade and I discovered that public policy articles in the leading health journals (especially the health policy journals) tend to cite poorly done studies over and over again in support of two propositions: (1) Our health care system needs radical reform and (2) the reform needs to be modeled along the lines of the systems of other developed countries. At the same time, these articles tend to ignore contravening studies that are often published in economics journals and subject to much more rigorous peer review.

In our rest-of-the-story literature review, we focus on eight questions:

1. Does the United States spend too much on health care?

2. Are U.S. outcomes no better and in some respects worse than those of other nations?

3. Is the large number of uninsured in the U.S. a crisis?

4. Does lack of health insurance cause premature death?

5. Are medical bills causing bankruptcy?

6. Are administrative costs higher for private insurance than public insurance?

7. Are low-income families more disadvantaged in the U.S. system?

8. Can the free market work in health care?

In a completely independent effort, Stanford University Professor Scott Atlas has made many of these same discoveries.

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4 Trackbacks for “The U.S. Health System: The Rest Of The Story”

  1. Health Care. (united health care, universal health care) » Blog Archive » Top 10 Health Affairs Blog Posts For March
    April 2nd, 2009 at 12:06 pm
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  3. The U.S. Health System: The Rest Of The Story / Health Affairs Blog « Eclectic Buzz Blog
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10 Responses to “The U.S. Health System: The Rest Of The Story”

  1. Maurice F Prout Says:

    The current health care system of the United States is the most expensive in the world, even though not all Americans have health coverage. U.S. president Barack Obama stated that one of his main goals is to ensure medical coverage for every American, but it seems to be a controversial issue. I believe the debate over healthcare reform in the United States should also be analyzed from a behavioral approach, along with other parameters that are being taken into consideration. This subject was thoroughly studied by Dr. Maurice F. Prout (Psychologist). His website http://www.MauriceFProut.com is a very useful resource of articles and publications that help to complement the understanding on the democratic process and the paradoxical behavior analyses affecting decision making.
    http://www.mauricefprout.com/

  2. John Goodman Says:

    You can see a similar version of this at my blog: http://www.john-goodman-blog.com/the-rest-of-the-story-2/

  3. Don McCanne Says:

    “wd” (DW Hogberg) criticizes me for failing to provide evidence supporting my challenges to the paper by John Goodman and his colleagues, but a blog is an inappropriate forum for answering a 20 page paper using “as many as 100 references,” especially when some of the references need to be challenged as well.

    Nevertheless, we have already provided an extensive criticism of a previous paper by John Goodman and Devon Herrick that took similar liberties in reaching spurious conclusions. That paper was “Twenty Myths about Single-payer Health Insurance.” (http://www.debate-central.org/topics/2002/book2.pdf) The response, written by John Geyman, was “Myths and Memes about Single-Payer Health Insurance in the United States: A Rebuttal to Conservative Claims.” (http://www.pnhp.org/facts/myths_memes.pdf). Repeating a similar critique of Goodman’s current paper is not worth our time since we’ve already made our point.

    And ideologues? Yes, we support the ideology of egalitarianism – the view that everyone should have the health care that they need without having to face financial hardship. That is very different from the “you’re on your own” ideology wherein you are expected to shop for health care with your own health savings account that you were never able to fund.

  4. DW Hogberg Says:

    I must admit that I am impressed by Don McCanne’s comment.

    He attacks Goodman, Herrick, Gorman and Sade for using studies that are “discredited as manipulations or distortions based on libertarian ideology, even though they are aware of the highly credible challenges to those reports.” However, he never bothers to cite a single example. I didn’t know that making an accusation without backing it up with evidence was a valid tehcnique of argumentation.

    He suggests that Goodman et al. are inhuman by saying that their report is “repulsive to those of us outraged by the…victims of a flawed financing system.” Apparently it never occurs to him that Goodman, et al. could be outraged by the same thing but see the causes of and solutions to the problem as very different. There can be no intellectually honest disagreements. Goodman, Herrick, Gorman, Sade and anyone who agrees with them are just “ideologues.”

    It sure is a good thing that we have all those “non-ideologues” at McCanne’s organization, Physicians for a National Health Plan, to enlighten us.

  5. Brian R Williams Says:

    In other sectors of the U.S. economy (besides health care), businesses thrive when they cater to the needs of consumers by producing goods that improve the quality of life. Many countries around the world have copied this American free-market system because it works. Businesses compete with each other by producing better goods that are less expensive. This creates multiple positive outcomes for consumers. Among other things, this free-market system ensures that someone (an entrepreneur) is always trying to improve on the status quo, creating better solutions that cost less. Furthermore, under this system, entrepreneurs are always trying to expand their reach to more people – not only to those who are wealthy, but also to the rest of us. So as a middle-income American, I drive a car with air bags, cook instant popcorn in a microwave oven, watch a flat screen TV, send text messages on a cell phone, and eat fresh fruit in the middle of winter – all of which would have been prohibitively expensive just a few years ago. Because entrepreneurs compete with each other based on the cost and quality of goods, we all have better cars, microwaves, TVs, cell phones and food, among other things.

    In his articles and studies, John Goodman explains how to draw on these same free-market forces to reduce the cost and improve the value of health care. By creating a financing system that rewards doctors who compete on quality and price, we can improve the overall value and reduce the overall cost of health care in this country. Goodman is also talking about creating and expanding markets that will bring affordable, quality health care to the low-income, chronically ill, the elderly, and other vulnerable populations – just like in other sectors of our economy. This, it seems to me, is a health care solution that would succeed in the United States. Entrepreneurs are ready to solve these problems, but in the health care sector of our economy, they are held back by burdensome government (and third-party insurance) payment schemes that actually pay them less when they create a better, more efficient way to deliver health care. The system is perpetuating mediocrity, instead of encouraging innovation and problem-solving.

    I don’t mind if scholars want to study and examine the health care systems of Canada, France or Cuba – but I’m hesitant to copy an economic model to pay for health care from a country that never made a good car, TV, microwave or cell phone.

  6. Matthew Holt Says:

    There’s little point going through a blow by blow refutation of Goodman and his fellow hacks’ series of out of context citations and ridiculous assertations.

    Instead let him answer the real question. If he were not (with his wife) making the better part of a million bucks a year running a propaganda mill funded by the HSA crowd, would he REALLY want to be a poor, uninsured sick patient in the US, or in one of those European hell holes where they don’t ration treatment via job, education level or choice of parents and send the collections agent after you when it’s done?

  7. PaulHsiehMD Says:

    The free-market reforms discussed by Goodman and his colleagues deserve an appropriate hearing.

    History has shown the virtues of the free market in every other sector of the economy. And our experience with partially free markets in health care also shows that people benefit tremendously when they are allowed to freely trade goods and services based on mutual self-interest — as is their right.

    As a practicing physician, I’ve worked with many patients who use health savings accounts for their medical purchases and I’ve found them all to be consistently knowledgeable consumers interested in gaining the maximum benefit for their health dollar. I wish all my patients were like this.

    America should not adopt the failed health systems of other countries. And I’m glad that people like Goodman, Gorman, Herrick, Sade, and Atlas are willing to make this point.

  8. acavale Says:

    Very eye-opening indeed. I wish there could be more open discussion of the ideas/observations mentioned in this paper. While, I cannot claim to be aware of all the facts cited, I can vouch for the effectiveness of price transparency in medical services. Even those who espouse a single payer system have to acknowledge that the ability to offer transparency of pricing for medical services outside of the third party payer system (private or government) offers the best chance to innovate and offer the best suited care to the population. In my own practice (and in those that have a cash-only practice) I have observed that those without coverage often get timely access to appropriate care as compared to those that have poorly reimbursed “coverage”. As Mr. Goodman rightly points out, cost figures can easily be lowered by transferring actual costs to the providers. This type of artificial price control will not help those that need medical care.

    The only other aspect that did not find mention in this paper was how the lifestyle of the average American plays a part in higher health care utilization as compared to those in other developed countries.

  9. Aaron Roland Says:

    I’m no academic. Although I graduated from Yale University, I dropped out of Yale Law School and now I’m just a practicing family doctor.

    Every day I struggle with the unbelievable bureaucracy imposed upon me and my patients by the health insurance industry. I chafe as I pay the bill to my billing service, which nevertheless earns its money, coping with the 150 different insurance companies with which I must contract if I am to service my patients adequately. I cry at times along with my patients whose loss of insurance has left them unable to afford their medications.

    I’m no academic, but I can tell you that Goodman is dead wrong. The only thing that will cure our ailing health care “system” is a wholesale change that provides truly universal coverage and eliminates the waste and inefficiency of a system balkanized by the insurance industry.

  10. Don McCanne Says:

    John Goodman says that he wants us to hear the rest of the story, but then he doesn’t tell it to us.

    He and his colleagues have pieced together a document using classic Goodman rhetorical deceptions. They pull out of the literature isolated items that support their position without identifying them as exceptions to the great body of information available in the health policy literature. They repeat the use of many studies that have been discredited as manipulations or distortions based on libertarian ideology, even though they are aware of the highly credible challenges to those reports. They use silly diversions to attack some of the most solid and important studies in the health policy literature. Patching these deceptions together creates magical conclusions that would seem to refute the most fundamental principles that can be gleaned from a couple of decades of solid health policy science research.

    Using health policy reports retrieved from the refuse bin, they then end with the conclusion that we should adopt their favored proposal for reform, health savings accounts, a non sequitur to the specious arguments they have presented. Even though the policy community has dismissed HSAs as a serious response to the tragic dysfunction of our health care system and its financing mechanisms, the authors persist in abandoning their academic purity in pushing their cause.

    “The Rest of the Story” might appeal to ideologues, but it is repulsive to those of us who are outraged by the the physical suffering and financial hardship faced by the millions of U.S. residents who are victims of a flawed financing system, unable to afford or receive the care that they need in a $2.5 trillion health care industry.

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