A Letter to Paul Krugman: In Defense of the Health Care Consumer

A Letter to Paul Krugman: In Defense of the Health Care Consumer
May 24, 2011

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)


Dear Mr. Krugman:

In your recent New York Times column, you write, “patients are not consumers” and go on to call such a characterization “sickening.” Asking “How did it become normal, or for that matter even acceptable, to refer to medical patients as ‘consumers’?”, you write:

Medical care is an area in which crucial decisions—life and death decisions—must be made; yet making those decisions intelligently requires a vast amount of specialized knowledge; and often those decisions must also be made under conditions in which the patient is incapacitated, under severe stress, or needs action immediately, with no time for discussion, let alone comparison shopping.... There’s a reason we have TV series about heroic doctors, while we don’t have TV series about heroic middle managers or heroic economists.

This view encapsulates an antiquated and now-ludicrous depiction of health care decisions in America, derived from ER, House M.D., or perhaps General Hospital, where handsome, wisecracking surgeons face a barrage of patients with obscure, life-threatening conditions. In this world, every visit with a medical professional is preceded by a call to 911 and a trip on a blaring ambulance—which is the experience for approximately zero Americans, anywhere.

According to the U.S. Department of Health and Human Services and the Agency for Healthcare Research and Quality, up to 75 percent of U.S. health care costs are due to chronic conditions. As our population ages, the management of these long-term conditions will continue to drive the rising cost of care.

Cost Breakdowns Show Truth

The nation’s health care insurance system is poorly built for this reality, having been designed in the 1930s to cover catastrophic events, not chronic conditions, predictable treatments, and long-term care. As a 2009 report in McKinsey Quarterly noted,

The fundamental nature of medical risk in the United States has changed over the past 20 to 30 years—shifting away from random, infrequent, and catastrophic events driven by accidents, genetic predisposition, or contagious disease, and toward behavior- and lifestyle-induced chronic conditions. Treating them, and the serious medical events they commonly induce, now costs more than treating the more random, catastrophic events that health insurance was originally designed to cover.

Employer- and government-based insurance now separate consumers from price signals and eliminate transparency in the marketplace, causing people to be overinsured for some risks and underinsured for others. The nation today is burdened with a nonsensical health care system where government-driven incentives warp the decision-making process for both doctors and individuals.

Move Toward Markets

The small steps taken toward market approaches allowing for expanded consumer power have shown positive results as individuals make decisions based not on artificial systems constructed by agencies, but on their own priorities and needs. These examples were sadly ignored by President Obama. The irony in his mistake and yours is that the government-managed coverage systems you favor are perhaps at their worst in providing responses to life-threatening illnesses.

Under the United Kingdom’s National Health Service, in which consumer power is extremely limited by law, the cancer mortality rate is more than 38 percent higher than in the United States. According to Lancet Oncology’s CONCORD study, in the UK, women with breast cancer have a 46 percent mortality rate, compared with only 25 percent in the United States, and whereas only 19 percent of men in the United States who get prostate cancer die of it, in the UK it kills 57 percent.

Of course, the UK was recently touted by the Economist Intelligence Unit for ranking at the top in one category, thanks in large part to the abundant provision of painkillers as opposed to costly extended treatment: quality of death.

That’s what the beau ideal of government-run health care gets you, Mr. Krugman: a system in which patients have no ability to act as consumers, where providers do not have to compete for their business, where individuals are treated too late, and all that the system will allow is to give them some painkillers to make them comfortable before they die.

Such approaches might make for dramatic television, but they make for terrible policy.

Benjamin Domenech (bdomenech@heartland.org) is managing editor of Health Care News.

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)