Caveat Archos

[This is a July 12th  post from my personal blog-site’s archive: http://getintuit.blogspot.com/2007/07/so-you-say-you-want-universal-health.html]I attended a pretty interesting discussion yesterday about the state of health care in the US and how the private markets might/should fit into the solution. It got me thinking: why do people seem to be demanding “universal/free health care? More importantly, why has the intelligent rebuttal illustrating the damaging potential costs been so weak? The necessary information is not being shared with the voting public, nor with the elected representatives, I think. But, instead of beating the dead horse of “it’s all the media’s fault” I want to introduce something I think may be innovative and informative.So, you say you want universal health care? Ok. I am taking Canada as an example of the type of system we would probably mimic if HillaryCare/ObamaCare/EdwardsCare ends up being passed in the event of a Democratic victory in ‘08.

In Canada, health care is distributed along what is called the “queue system” which is basically a fancy way of saying the “get in line and wait your damn turn without the ability to move ahead in times of necessity” system: you can’t say to the guy who’s waiting for a kidney transplant ahead of you, “um, excuse me sir. I really need this valve replacement. Do you think we can switch spots?” (Before you say, “well, we could have that adjustment,” you have to realize the existence of that possibility in the system would invalidate the entire system and just result in what we have now, but instead of choosing along lines of convenience in time, one would choose along lines of money spent on attaining the advanced spot in the queue, creating all sorts of distortions that would exacerbate the current problem.)

Can you think of another system that deals with matters of importance but has excrutiatingly long times between the raising of an issue and its settlement? Well, here it is: The American Civil Judicial System (or, “the judicial system” for further reasons of expediency). The Judicial system is supposedly accessible to all citizenry for all manners of disputes, be they minor or major, much like a universal health system would be; The important thing to realize here is that since the opportunity cost of filing a complaint in court is minimal to the plaintiff, and in many cases, results in unearned/untrue transfers of wealth to the plaintiff by the defendant (who might choose to pay off a settlement instead of incurring all the charges necessary in a trial, even if they are the righteous party). The court system is literally choked with what are probably unnecessary cases that may not even reach trial (nor were they designed to get that far in the original complaint), but probably will follow some of the procedural steps toward the final trial: thereby wasting the resources of the judges, clerks, lawyers, etc, when such resources could be better used in more pertinent cases.

But how would one decide the pertinence of a case? It is in this case that health care should be more like law/jurisprudence in terms of innovation. The latest trend in law (as far as I can see) is toward the use of “alternative dispute resolution” (mediation, arbitration) in instances where a full trial is unnecessary. Let me make a metaphor which may help with dispelling any confusion. Let us assume two points along an X-axis: Point A is “the free market approach” where participants decide how much health care they want and purchase as much, and Point B is the “egalitarian/socialist approach” where health care is supposedly available to all, but the rationing mechanism is the queue (first come first serve approach) instead of the pricing system.
US health care                                Judicial System
A———|->—————————<-|–B
Obviously nothing in the US would lie on either point in its entirety: However, one could see that current health care is erring on the side of Point A’s half of the axis, insofar that people decide how much healthcare they desire and pay (somewhat) for it accordingly. However, Healthcare is sliding toward Point B with the expansion of governmental insurance, etc and the demand for “universal access”. Meanwhile, the court system, by definition in the Constitution is heavily B-sided, insofar that people supposedly have “universal access” but the system operates along lines of a queue system where people traditionally have to wait long times between when the issue is raised and the issue is finally brought to court/resolved/decided. However, with the creation and utilization of “alternative dispute resolution” the system is operating more efficiently; at the same time, the alternative dispute resolution typically costs the parties involved some additional money in gaining access. Essentially, such an alternative provided people a choice to get out of the line (or never get into it).

So, here we have two very important topics that are operating on completely different dynamics while simultaneously they can learn much from each other, and much can be taken by comparing the two. Essentially, the imposition or creation of a full universal health care system would mimic the current judicial system: long lines, unnecessary wasting of resources, and no effective way to reveal preference (i.e. through pricing).

So you say you want universal health care revolution? Well, now you know…