Piling On

Apropos to Alex’s post below, the huge news in the last day is a study from Oregon that looked at the effects of expanding Medicaid. As McCardle points out, the study was done under near ideal circumstances. Oregon could not expand Medicaid to everyone who wanted it, so they created a lottery. Sociologists swooped in and recruited. The result was a study of 6000 people with Medicaid and almost 6000 without. One of the authors was an Obamacare architect. This is the kind of diverse randomly-selected sample that sociologists dream about.

The result is …. not much:

Utilization went up, out-of-pocket expenditure went down, and the freqency of depression diagnoses was lower. But on the three important health measures they checked that we can measure objectively–glycated hemoglobin, a measure of blood sugar levels [and diabetes indicator]; blood pressure; and cholesterol levels–there was no significant improvement.

It’s one of two major RCTs that have ever been done on insurance. And like the first one, it doesn’t show a signficiant effect. That is huge news. Not good news–obviously, it’s much nicer if giving people money to pay for health care makes them obviously much healthier. But big.

And it’s actually bigger, and more important than Obamacare. We should all be revising our priors about how much health insurance–or at least Medicaid–really promotes health. What this really tells us is how little we know about health care, and making people healthy–and how often data can confound even our most powerful intuitions.

In other words, insuring people resulted in more spending by the government, but not necessarily improved health. Gee, I think I’ve heard that before.

As you can imagine, the liberals are spinning as fast as they can. And, to be fair, they have a point. The study covers only of a couple of years and it might take a while for long-term effects to show up. But you know that if the study showed even the slightest improvement in health, they would be shouting it from the rooftops. They have, after all, spent years citing dubious studies that claim that the lack of universal healthcare kills, if I remember the Obamcare rhetoric correctly, at least 17.4 billion Americans every year. And, in fact, when the first Oregon study came out and showed that people weren’t healthier, per se, but felt better, the liberals crowed about it.

The new study is much more difficult to twist abut that’s not stopping their attempts. One thing they have harped on is that the insurance is preventing people from being financially destroyed by a health crisis. But Avik Roy is all over that in a must-read response to liberal excuse making:

Medicaid reduced financial hardship for the poor, by protecting them against catastrophic health risks. Wonderful, but we could have achieved the same outcome for a fraction of the price, by adopting the plan proposed by Florida’s Will Weatherford and Richard Corcoran: Offering low-income Americans a subsidy with which to purchase catastrophic coverage on the open market. That plan was foiled by people—including Republicans—who insisted on expanding Medicaid instead.

Ross Douthat is on the same page:

But what if we lived in a world in which the Republican Party had fully embraced the views of many right-of-center health policy writers (and some G.O.P. politicians, including the John McCain of 2008) and supported an alternative to Medicaid expansion, which would change the tax treatment of health insurance to free up money to create a universal tax credit or voucher designed to spur the purchase of catastrophic health insurance plans? What if the choice, in other words, weren’t between the current health care law and a repeal-plus-nothing G.O.P., but between the current health care law and the best conservative thinking on the issue?

This is, in fact, what most libertarians have advocated for years, including me.

I remind you that this isn’t a trivial question. Obamacare gambles some $750 billion on the idea that Medicaid will improve health outcomes, boost the economy, reunite the surviving Beatles and help us all lose ten pounds with diet and exercise. If the gain from that huge investment is this marginal, it is not worth it. I’m sorry to be cruel, but it not worth $750 billion to save only a few lives.

I do want to repeat my earlier caution that it would be odd to conclude that health insurance has no health benefit. We may not know for a while. But I do think it’s becoming clear that Medicaid expansion is not going to be the miracle breakthrough that so much of the Left has claimed it would be. If lack of insurance really were killing as many people as the Left insists it is, the Oregon data would show it. You might even already see a difference in mortality rates.

I know it surprises some people, but improving our nation’s health is not as simple as simply throwing lots of money around.

Comments are closed.

  1. Mississippi Yankee

    I know it surprises some people, but improving our nation’s health is not as simple as simply throwing lots of money around.

    Statements like that will get you dragged thru the liberal streets and publicly crucified.
    And they’ll burn your libtard card too.

    Thumb up 6

  2. stogy

    I know it surprises some people, but improving our nation’s health is not as simple as simply throwing lots of money around.

    I agree. I think adding 45 million people to a broken system was always a bad idea, although there were a couple of minor reforms attached with regard to health financing that were not so bad. But they only really addressed the symptoms. The whole system of health financing needs to be reviewed to promote competition on the supply side. And to improve outcomes and access on the demand side. The biggest problem is massive overcharging. And a health system that is geared toward the most expensive solutions rather than common sense and good health management.

    I read somewhere a while back that a major difference between the health systems in the US and Japan was that pharmaceutical interventions were much more common and at least as effective in Japan. The main reason for a divergence in practice is that surgery pays a lot more in the US than writing a prescription, but in Japan, it wasn’t nearly as lucrative, and is therefore quite rare in comparison. Given that life expectancy is better in Japan (but then so is diet, so it isn’t necessarily a valid comparison), it might be worth promoting other solutions to health problems than reaching for the scalpel first. And to cut the rewards when you do.

    What if the choice, in other words, weren’t between the current health care law and a repeal-plus-nothing G.O.P., but between the current health care law and the best conservative thinking on the issue

    But to actually do that, to implement it, you have to take on the entire medical world, and everyone currently milking the system for all they can. And I don’t think either of the major parties have the cojones for that.

    I really liked the article that Hal posted a couple of years ago from the Atlantic by David Goldhill suggesting a model of personalised health accounts, along with mandatory catastrophic health insurance (for everything over $100,000. It was well-argued and made a lot of sense. It would be worth trying at least and should bring down costs. But the health outcomes are unknown.

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  3. Hal_10000 *

    Stogy, I’ve cited the Goldhill article many times. It’s excellent. I have a post brewing that riffs on Stephen Brill’s recent expose.

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  4. stogy

    Heh… I agree with what I see is a conservative position and I still get thumbs downed. And no reasons given as to why.

    Pretty cowardly position, guys.

    Thumb up 2

  5. stogy

    I thumbs-downed your last comment. So now nobody can call me a coward.

    Ah. But you didn’t say why!

    Something like “Yyou are snivelling, whiny heap of parrot droppings because…” would have sufficed.


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  6. Thrill

    Why? Well, I did it specifically so I could admit it to it. Made a lot more sense after I drank all that beer than it does now.

    Aside from that, I have no idea why your first comment got downvoted by all those people. Seemed pretty rational and evenhanded to me.

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