Friday, January 27, 2006

Health care questions

There are those who like to paint the Health Care Establishment as uncaring, if not outright evil.

Insurers, for example, will often refuse to pay $150 for a diabetic to see a podiatrist, who can help prevent foot ailments associated with the disease. Nearly all of them, though, cover amputations, which typically cost more than $30,000.

Ian Urbina, The New York Times, January 11, 2006

Somehow, health insurers are supposed to prefer paying $30,000 for one procedure over paying $150 to prevent it. If you or I were told, "you have a choice: you can pay $150, or you can pay $30,000. Which do you prefer?" it'd be a no-brainer.

Urbina focuses on the Beth Israel diabetes treatment center that closed because of lack of funding. The treatment philosophy of the center comes across as sound. Urbina tells some inspiring anecdotes. However, he offers no data on the overall performance of the treatment center. Did it achieve success with fifty percent of its patients? Ten percent? One percent?

I would trust liberals a lot more if they would ask questions about effectiveness. Instead, Urbina, like many people who trade in folk Marxist narratives, focuses on establishing the superior motives of the Beth Israel diabetes treatment center and the misguided motives of health insurance companies and others.

Kling discusses some reasons why Beth Israel may have closed. I suspect Urbina would love to see regulations passed forcing insurers to keep the center open, even if its success rate is only one percent.

(By comparison, if only 1% of the $150 podiatric visits prevent an amputation, you're spending $15,000 to prevent a loss of $30,000. It still looks attractive, as long as the amputation is not too far in the future. If that amputation is, say, 20 years in the future, the future value of the $15,000 may be more than $30,000. In fact, if the interest rate is higher than about 3.5%, it will be.)

Kling mentions one factor in the management of diabetes:

Poverty is one obvious factor in the low skill level of some diabetics. One would hope that Medicaid would work to alleviate this. However, Urbina's article points out that the Beth Israel Center lost money on Medicaid patients because of Medicaid reimbursement rules. To me, this suggests either that the government was not convinced of the value of Beth Israel's treatment system or that single-payer health insurance is not the panacea for disease management that liberals take it to be.

Or maybe both.

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