Thomas E. Woods, Jr., is the New York Times bestselling author of 11 books, including The Politically Incorrect Guide to American History and Meltdown (on the financial crisis.) A senior fellow of the Ludwig von Mises Institute, Woods has appeared on MSNBC, CNBC, FOX News, FOX Business, C-SPAN, Bloomberg Television, and hundreds of radio programs... (Read More)
On my podcast last week — which to my amazement is now at #5 on iTunes under News and Politics! — the subject of health care costs came up in my discussion with Bob Murphy. Someone wanted to know how people could try to blame rising costs on technological advancement instead of on the various ways in which the government interferes in health care. After all, technology leads to lower costs everywhere else. Why should health be the exception?
I noted that yes, there were plenty of reasons that the government is to blame for rising costs, but I also noted that technology could in fact push costs up. Suppose there is no cure for malady X. Then a treatment is developed that costs $5000. Costs just went up from $0 (since when no cure is available, there’s no money you can spend on it) to $5000. Yet this is entirely benign, and we are surely better off.
Michael Degaray disagrees. He writes:
I’d like to briefly address a question from the podcast last week with Bob Murphy. Both Bob and yourself concurred that while government involvement in healthcare deserved the majority of blame for rising costs, there appeared to be a concession that technological advancements were a contributing factor to these costs.
I completely disagree and maintain there is no benign reason for increase in healthcare costs. Why should healthcare be different than every other industry? The statists would love it as they would parade it around as a market failure and another reason for intervention.
Here’s my abbreviated take:
American Medical Association has been bullying other forms of healing since its creation in 1840s. They used political means (Flexner report, regulations of medical schools, propanganda campaigns) to wrestle market share away from herbalists, homeopaths, chiropractors, and acupuncturists. Allopathic (conventional) medicine didn’t WIN in the market but was pretty much granted a monopoly by using regulations and propaganda to shift public opinion about the industry.
Conventional medicine as we have today has only two tools: drugs and surgery. Both are expensive. Alternative medicine is comparatively inexpensive and works well for many conditions without drugs or surgery.
Technological advancements could only raise costs if not directed towards productive ends. Look at some of what the medical establishment refers to preventative care:
- Aspirin Use to prevent cardiovascular disease
- Blood Pressure Screening for adults
- Cholesterol Screenings
- Type 2 Diabetes Screenings
- Annual mammograms for women of certain age
- Annual PSA test for men of certain age
There is no evidence that aspiring use does anything to prevent cardiovascular disease. Never has been. There is growing evidence that daily use causes more harm than good.
“Screenings” have good intentions but ultimately just become a pharmaceutical sales drives creating customers for life. That’s not preventative care. Conventional medicine treats everything like a nail because all they have is a hammer. The problem with high cholesterol, for example, isn’t the level of cholesterol as much as it is ‘what is causing an individual’s cholesterol to be elevated.’ Drugs just mask the problem by intervening to lower your number. That sets up the bigger problem down the rode as the underlying cause is not addressed. Believe me, people don’t have high cholesterol due to a lack of Crestor. And it’s great that we have the technology for life saving surgeries but we are greatly overusing it.
Annual mammograms and Annual PSA test recommendations are being revised because we are over testing. A recent study shows the annual PSA tests have no net benefit or the harm actually outweighs the benefits. they recently changed the starting age of annual mammograms from 40 to 50 for the same reasons. That’s a lot of money down the drain.
Look at the C-section rate in hospitals. It hovers around 32% in America. The CDC recommends it at 15%. C-sections save lives of Moms and babies but 1/3 of all deliveries? That’s outrageous. But with third party payer system the compensation is much higher for c-section. Also, the OB profession has been using propaganda and regulations for years against midwifery.
Last one- the AMA recently announced that obesity is a disease. Obesity is as much of a disease as Bob Murphy is a Keynesian. Why would they do that? Well, it’s the first step in pressuring insurance companies to pay for bariatric surgeries and anti-obesity drugs. Guess what happens to our premiums.
So it’s not the existence of the new technology but the use of it that is driving costs. The demand for the drugs and expensive treatments is artificially high. Big Pharma and Big medicine have worked hard for their cartel made possible by our overreaching government.
If I can borrow from Bastiat, this is what is seen. What is unseen is the advancements in the fields of holistic health practices that have been lost over the last century. And we will continue to pay for it.