Free Lunch, Please

Today we'll take a break from statistics and math to peruse a typical pro-universal health care argument. My wife is a student in a persuasive writing class, and argued against Universal Health Care. Below is her professor's response to my wife's rough draft:

I made some comments below. Too often, the substance of the argument in the outline relies on what might happen, not necessarily what does happen.

To push your critical thinking skills, consider this. We already pay extra money, even with insurance. In my case, I have a deductible of $1,500 per person, a co-pay of $20 and $50 for specialists, and 20% for all tests. The important medications that my husband and I take, add up to several hundred dollars a year. Our average yearly pay is around $5,000, more if we have a surgery or two (which for five years or so seemed to happen regularly). I’m not alone in this. I would gladly pay this in “higher taxes” if I were to be guaranteed that I would not be dropped from the plan (I’m a cancer survivor) or that every procedure would be approved (I had to have the surgery I was trying to avoid because my plan would not cover the cost of a test!). The surgery was the less expensive of the two.

Since my husband has medical problems of his own, we see specialists routinely. My wait for the oncologist is several months! If I miss my yearly appointment, M.D. Smith will drop me as a patient. We often are not accepted by specialists because they refuse our healthcare. I can go on and on, but I am going to stop here to add that I have two brothers who live in Canada. One of them had cancer and the other respiratory illnesses brought on by TB. They see their doctors regularly and sooner than I can see mine, have all the tests they need in a timely manner, free medicines (one of my brothers has not paid for his medication ever), and would not trade their place with mine for the world.

Unfortunately, I’m not alone, so your audience is going to be somewhat skeptical of a future of “might be’s” when the reality of what we have that passes for healthcare is ugly and expensive. We have the most advanced medicine in the world, yet we are behind most industrialized countries in health. How this possible if the health care is the best in the world? These facts have been around for a while, so your audience is going to be hard to persuade. You are going to have to argue with the reality rather than with future possibilities.

Let's examine this argument closely, neglecting the fact that it's completely anecdotal. First, it's beyond me why the onus would be on those who are against massive changes to a system to prove that those changes wouldn't be for the better. I should think if you are proposing massive changes to a system that, for the most part, works pretty well (it allowed you to survive cancer!), the burden of proof would be on you to show me why we'd all benefit. But all we get are sob stories from cancer survivors about how they are forced to schedule annual checkups or find a new doctor. (yes, such is the horror of American medical care.)

"We already pay extra money, even with insurance. In my case, I have a deductible of $1,500 per person, a co-pay of $20 and $50 for specialists, and 20% for all tests."

This person is talking about the out-of-pocket expense, which is a price. This has nothing to do with the cost of medical care; only how her specific plan is set up. The assumption is that if she could pay for a plan that charged her higher rates so that she wouldn't have to pay the out-of-pocket expense, she would. In other words, she has a preference for a monthly or annual bill instead of many small expenses.

This makes little or no sense. Most people would rather pay small expenses regularly than a large bill all at once, because they are most likely to be able to plan for and cover those small costs since they're less disruptive. Nobody likes to get hit with a $5,000 bill all at once. If this professor does indeed want that, she could prepare a $5,000 bill for herself at the beginning of the year, put that money in a savings account, and pay for the incidental expenses from that account throughout the year.

However, that's probably not what the professor wants. What she more likely wants is for someone else to pay for these expenses. While understandable, this is an unsustainable position, since just about everyone would prefer that everyone else pay for their own expenses. This doesn't make the cost go away, and we've already discussed why this raises the cost of a service for all involved below.

Our average yearly pay is around $5,000, more if we have a surgery or two (which for five years or so seemed to happen regularly).

So the professor and her husband have an annual surgery (or two) and pay $5000 or maybe more per year for that service, which if they own two cars, is probably less than their car payments, gas, and car insurance costs. This seems more than reasonable to me. They aren't asking for the government to provide them cars, so why health care?

I would gladly pay this in “higher taxes” if I were to be guaranteed that I would not be dropped from the plan (I’m a cancer survivor) or that every procedure would be approved

Ok, so she wants a guarantee and is willing to pay for the entire cost of it through higher taxes. She's willing to pay taxes high enough to ensure that she can have any procedure she wants at any time.

But wait, that's not really what she means, by her own admission. By paying out-of-pocket the option she wants exists already, but she obviously is unwilling to foot the bill. She can go to any hospital or specialist in the country and pay cash for any procedure she desires, and not have to ever worry about insurance again. Too expensive? If so, then she is unwilling to pay the cost for the service she desires.

The underlying assumption here is that someone else is going to cover the difference between what the professor is willing to pay and what the medical care she desires costs. She does not specify who that "someone else" is.

(I had to have the surgery I was trying to avoid because my plan would not cover the cost of a test!). The surgery was the less expensive of the two.

We're getting to the root of it here. Not only is she unwilling to pay higher costs for surgery she wants, she won't even pay out-of-pocket for a test to avoid surgery she doesn't want. Her unwillingness to pay any additional expense beyond what her insurance covers seems quite astounding; how would we expect that she'd gladly pay this cost if it came in the form of taxes? That doesn't make any sense; she obviously wants other people to pay for her care.

Since my husband has medical problems of his own, we see specialists routinely. My wait for the oncologist is several months! If I miss my yearly appointment, M.D. Anderson will drop me as a patient. We often are not accepted by specialists because they refuse our healthcare.

Again, problems that would be alleviated by paying cash, which she is unwilling to do. I have another anecdote; my parents pay through the nose for Blue Cross/Blue Shield and have none of these problems. This professor could have opted for that insurance, but odds are she didn't want to pay that cost, either.

They see their doctors regularly and sooner than I can see mine, have all the tests they need in a timely manner, free medicines (one of my brothers has not paid for his medication ever), and would not trade their place with mine for the world.

It's starting to sound like the professor believes in the medicine fairy, because I'm quite sure that her brother does indeed pay indirectly for his medicine. If not, then someone else is paying for it, and from what she's said I can understand why she'd be enamoured of that circumstance. However, none of this makes the cost of providing the medicine go away.

Unfortunately, I’m not alone, so your audience is going to be somewhat skeptical of a future of “might be’s” when the reality of what we have that passes for healthcare is ugly and expensive.

Translation: I don't want to pay the entire cost of my health care, and there are many more people like me. We want someone else to foot the bill, and are completely unsure who that might be. We don't expect that the "someone else" has medical expenses also, or that we are the people that would be paying extra for other people with even higher medical expenses. Things are so bad here that I survive cancer and have annual surgery for $5,000 a year. By the way, this is such a big deal to me that I am unwilling to move to Canada where my family is. I think the U.S. would be better some other way, and prove to me why it wouldn't, because my intuition trumps your logic.

This professor probably didn't set out to prove why universal health care is unsustainable, but I'll be damned if I could find a better argument.

Bad Decisions

How many times have you bought something that you didn't need? I know I do, quite often. Every music CD I own and every movie is something I don't need to live. I don't need a television at all, and yet I have one. I could bike to work and not have a car; I could live in a smaller house and my kids could have no toys.

Odds are if you are reading this in your spare time on a computer, you too have bought some things that aren't absolute necessities.

When you bought those things, did you think to yourself, "Since I'm buying this item for entertainment, and not saving the money for medical care when I'm much older, I'm making the decision that my entertainment now is worth more than possibly extending my life later."

Probably not, even though that's exactly the decision you are making. If you've ever paid for anything that wasn't a basic necessity for life, you've (consciously or not) made the decision that that was more important to you than paying for medical expenses later. Even now, after reading this, you will probably still go out and buy things that aren't necessities.

Let's switch gears and say that you're now 55 years old and need $20,000 for a medical procedure that your insurance doesn't cover. Given the option, would you take back all the money you spent on entertainment to save your own life? If your children could give up all entertainment expenses for five years in order to pay the $20,000, wouldn't you expect them to do that to save your life? That seems like an obvious "YES!" to me. My children would be pretty heartless to value watching movies over saving dad's life.

So there's a paradox here. People are aware they are going to have to pay medical expenses at some point; they are also aware that insurance probably won't cover the entire expense. They also know if they were ever in trouble they'd gladly go back and not buy DVD's and TV's in order to live longer. Yet these same people still buy DVD's, luxury cars, expensive dinners at nice restaurants, and computers instead of saving the money for inevitable medical expenses later. Why?

The simple answer is that people are short-sighted, and don't like to think about becoming ill or the associated expenses until they are forced to. By any but the most tortured logic, not saving for inevitable medical expenses is the height of irresponsibility.

The other simple answer may be that people do indeed value entertainment and living a "good" life over living a long life. I'm sure this is true to some extent for many people; if so, making them pay for universal health care is a punishment. But I digress.

How do you feel about the guy who eats fast food for every meal and has a heart attack? How about someone who spends his last dime on drugs or alcohol instead of food? These are people who made very bad decisions and suffered the inevitable consequences; you probably have very little sympathy for them, and even less inclination to give up your money to bail them out.

How about the 55 year-old who needs a $20,000 surgery to live, but has no money to pay for it? That's pretty sad, right? What if that 55 year-old owns a Mercedes, and always has owned a luxury car? What if that 55 year-old carelessly bought a large house on a lake for more money than he could hope to afford? What if he had gambled his life savings away in Vegas over the past five years?

Are you starting to feel less sympathetic toward the hypothetical 55 year-old? If so, that's because you recognize that when we spend money we do indeed make a decision between the thing we are purchasing now and all possible future uses of that money.

This isn't a serious problem until people start demanding that other people pay for their past irresponsibility. The 55 year-old, who long ago decided that luxury cars and gambling were worth more than a long life, is now seeing the result of that decision.

"But wait," you say, "nobody told this guy that this was his choice. Now that we've read your blog and know better, isn't it ok for the guy to get the money from his son and we can now be responsible and live happily ever after?"

Fair enough. Let's assume this man's son pays for his father's medical expenses. The son lives frugally and minimizes entertainment expenses to do so. By paying for his father's care, he has no money left over to save for his own. The son gets to be 55 and has the same medical problems his father did, and has saved nothing. His son is an irresponsible gambler.

Now what?

Let's assume that an entire generation of people have made this decision over their entire lifetimes, leaving themselves and their country in massive amounts of debt, such that there is no way that they will ever hope to pay for the inevitable medical expenses coming. Let's also assume that the generation following is just over half the size of the previous generation, and nearly half of that generation is similarly irresponsible and unable to pay for their parents' medical bills. So our assumption leaves us in the predicament that to pay for the large generation's medical expenses, the most productive and responsible members of society will be held responsible for 3 or 4 older peoples' costs. This would be absolutely crippling economically. In fact, we no longer have to assume; that's exactly what's being proposed right now.

"BUT WAIT AGAIN!" you say. "You're missing the fact that this is the perfect reason to have universal health care! People won't act responsibly on their own, so we can make them!"

This would be true if the people in government weren't the same people who make the bad decisions that the rest of us did. In fact, by virtue of acting on a large, long-term scale, those in government can put off seeing the effects of their bad decisions until well after they and their children are dead. If this weren't true, social security and Medicare would be solvent.

There is a cost for irresponsibility, and the only way to avoid paying that cost is to be responsible in the first place, or to push the cost off onto someone else until the entire system collapses.

Seeing the cost of irresponsibility first-hand is a good lesson for people. "My dad died before his time because he was a drunken gambler" brings the message home much better than, "because my dad was a drunken gambler, someone's great-grandchild will live through a depression."

In fact, if the only people to suffer the consequences of your actions are people you will never meet, it's tempting to act however you like.