From: jwh@citi.umich.edu (Jim Howe)
Subject: Re: The Decline of America: Health Care
Date: Mon, 28 Sep 92 10:15:26 EDT
Organization: IFS Project, University of Michigan
Reply-To: jwh@citi.umich.edu

In article <1992Sep25.155621.22855@vexcel.com>, dean@vexcel.com (Dean Alaska) writes:
|> In article <1992Sep24.204236.1@indyvax.iupui.edu> harvey@indyvax.iupui.edu writes:
|> >In article <1992Sep24.173634.705@vexcel.com>, dean@vexcel.com (Dean Alaska) writes:
|> >> In article <h-y-6L-@engin.umich.edu> jwh@citi.umich.edu writes:
|> >>>
|> >>>I have seen research which examined government intervention in health
|> >>>care from both the cost and quality perspective.  The conclusion was
|> >>>that government intervention neither reduces costs nor improves the
|> >>>quality of care.  At the same time, it wasn't found to particularly
|> >>>hurt it either.  On the issue of infant mortality statistics, the
|> >>>researchers examined data from several OECD countries and found, after
|> >>>controlling for factors such as education, GDP, availability of
|> >>>care, etc., that 'other' factors were the reason for the higher
|> >>>rate in the U.S.  They didn't elaborate on what the 'other' factors
|> >>>might be.
|> >>>
|> >> If it finds that govt intervention didn't help or hurt, and if
|> >> unspecified factors were the cause of the differenc in health care
|> >> statistics, then it seems that this study doesn't have too much to
|> >> offer to the debate about national health care.
|> >
|> >I thought the debate was about whether we need govt intervention in health
|> >care!  Why encourage govt intervention if it's not going to help?
|> >
|> Although this particular study said that govt intervention didn't help
|> or hurt, it didn't figure out (or at least didn't say) what does cause
|> the big differences in health statistics.  Until these factors are
|> spelled out, the question is open.  The study is either hiding something
|> or overlooking something.  Until that something is discovered, we can't
|> assume that its initial conclusions are complete or accurate.  They
|> could simply have overlooked an important factor.

Here are some excerpts from the conclusion section of the paper:

"Perhaps government can indirectly improve the performance of the
health care sector by creating an environment that allows the 
macroeconomy to function properly.  Our results indicate that
infant mortality is greatly influenced by higher levels of real
GDP. [...]

[...] Our empirical study also finds that more abundant medical
services cause infant mortality to decline by a substantial
percentage.  Certainly, the government should not adopt regulations
that negatively affect the quantity and quality of medical inputs.
Some health economists view the diagnosis related groups system and
relative value scale scheme as regulations of that kind.

[...]

Of course, more studies are needed before any empirical generalizations
can be made and policy implications can be safely drawn. [...]"

While it is true that we can't rule out the notion that the initial
conclusions are complete or accurate, it does raise a red flag.
Given the track record of other U.S. government programs, given the
fact that a national health care program such as NHI would give
government greatly increased control over health care options and
given the probability that the system wouldn't improve health care
or reduce costs, I prefer to look at some other alternatives.  Alternatives
which are more in keeping with individual freedom and reduced
government interference.


James W. Howe                  internet: jwh@citi.umich.edu
University of Michigan             uucp: uunet!mailrus!citi.umich.edu!jwh
Ann Arbor, MI   48103-4943         

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