It Does Not Compute, It Does Not Compute

Spending more to save money:

One reason preventive measures can cost so much is because they often need to be applied to a big chunk of the population in order to avoid a few cases of a disease. Most of the people receiving the preventive care wouldn’t get sick anyway.

Of course, just because a preventive measure adds to overall costs doesn’t mean it’s not worthwhile. The Circulation study, for instance, estimated that more widespread use of preventive measures against heart disease would reduce heart attacks and strokes in the U.S. When preventive measures accomplish that at a reasonable cost they are said to be cost effective even when they add to overall health spending. It’s important not to confuse the two concepts when you hear health reform debated.

You won’t be surprised to learn that American doctors already tend to prescribe preventive measures more readily than doctors in other medically advanced countries. A recent peer-reviewed paper by Samuel H. Preston and Jessica Y. Ho at the University of Pennsylvania’s Population Studies Center finds, for instance, that U.S. doctors screen more vigorously for cancer than doctors in Europe and administer cholesterol-lowering drugs more commonly, too. About 88 percent of Americans with high cholesterol receive statins and similar drugs, compared to just 62 percent of Europeans, the study found. The more aggressive treatments account for better outcomes in the U.S. for everything from several types of cancer to cardiovascular disease, the authors estimate in their paper, entitled “Low Life Expectancy in the United States: Is the Health Care System at Fault?” (Their answer, by the way, is no.)

If you have followed the health care debate you can see the contradictions inherent in such data. On the one hand, critics of our medical system say that we spend so much more of our gross domestic product on health care than other advanced countries because our doctors overprescribe. But much of what they are overprescribing are tests and other preventive measures–like cholesterol-lowering drugs. Meanwhile, President Obama and others continue to advocate reform that includes even more preventive care, but to save money. It simply doesn’t compute.

Or, what he said.  

The extravagant claims of vast savings from ObamaCare have been shot down over and over again by the Congressional Budget Office. Yet the claims are simply repeated louder and louder while the speakers hold their fingers in their ears and refuse to listen to the fact-based criticism from the CBO. 

People – good, decent honest people – are worried about the cost of health care. And they are hoping that Obama’s “reform” can help contain the beast. Unfortunately, the hope is futile. These schemes will cost more and more, not less and less. They will raise insurance rates, they will raise taxes, they will cost jobs and economic growth.

You cannot save money by spending more. If, as the studies indicate, a lot of the high costs from the existing system is due to the prescribing of preventative tests and procedures, how will adding millions more consumers of that overprescribed preventative care save money?

Sort answer: It won’t. Instead, insurance prices will skyrocket, care will be rationed (with first crack at resources to politicians and Federal employees) and treatments will be denied. Pills instead of treatment will be the only thing some people get. That is Obama’s stated preference. That is the concept Obama’s budget director, Peter Orszag has been publicly pushing.

Unless you want to be Orszaged – declared “not cost effective” – and given pills rather than treatment, you might want to start paying attention to what is really going on here. It is not “reform”. The insurance companies and the drugmakers largely back these “reforms”.

That should worry you. A lot.