Cut Medicine In Half
Today my medical skepticism appears as this month’s lead essay, "Cut Medicine In Half," at CATO Unbound. Distinguished health economists are scheduled to comment: Harvard’s David Cutler on Wednesday, RAND’s Dana Goldman on Friday, and Stanford’s Alan Garber next Monday. Open discussion begins next Wednesday. Also, I just learned that next Tuesday a book with a related thesis, Overtreated, will appear. My essay begins:
Car inspections and repairs take a small fraction of our total spending on cars, gas, roads, and parking. But imagine that we were so terrified of accidents due to faulty cars that we spent most of our automotive budget having our cars inspected and adjusted every week by Ph.D. car experts. Obsessed by the fear of not finding a defect that might cause an accident, imagine we made sure inspections were heavily regulated and subsidized by government. To feed this obsession, imagine we skimped on spending to make safer roads, cars, and driving patterns, and our constant disassembling and reassembling of cars introduced nearly as many defects as it eliminated. This is something like our relation to medicine today. …
King Solomon famously threatened to cut a disputed baby in half, to expose the fake mother who would permit such a thing. The debate over medicine today is like that baby, but with disputants who won’t fall for Solomon’s trick. The left says markets won’t ensure everyone gets enough of the precious medical baby. The right says governments produce a much inferior baby. I say: cut the medical baby in half, dollar-wise, and throw half away! …
Our main problem in health policy is a huge overemphasis on medicine. The U.S. spends one sixth of national income on medicine, more than on all manufacturing. But health policy experts know that we see at best only weak aggregate relations between health and medicine, in contrast to apparently strong aggregate relations between health and many other factors, such as exercise, diet, sleep, smoking, pollution, climate, and social status. Cutting half of medical spending would seem to cost little in health, and yet would free up vast resources for other health and utility gains. …
Added: Matt Yglesias mentions this great related essay by Phillip Longman.
There is some criticism of the Rand study here (http://www.marginalrevoluti..., basically arguing that those participants with significant health costs were more likely to leave the study to regain full coverage, thus skewing the results. If that criticism is correct, the entire premise of the argument collapses.
Floccina, they asked 60% of their subjects how much they exercised, at the start of their participation in the study. Then they asked all of them how much they exercised at the end of the study. They folded this information into a bigger combined variable. They found that having 50% more visits to doctors and 50% more hospitalisations didn't have much effect on the bigger health variable.
It makes sense that wouldn't have much effect on how much exercise people said they did, doesn't it?