Smarter Health Care, Part 1

If the events of the past few weeks have proved anything, it is that the United States is not close to passing significant health care reform. To an alien landing on planet Earth who knows nothing of our politics, this would make little sense. Check out these statistics from the OECD:

You might already be aware that the United States spends far, far more per capita on health care than any other nation on earth. But check out the bars in blue for an even more staggering statistic. The United States is behind only Norway in public and compulsory spending on health care. Think about that for a moment: already, the government of United States mandates more spending on health care than all but one nation on earth, and yet somehow we also manage to pay more out of our own pockets than any other country. A lot more. Meanwhile, we lack universal coverage (unlike every other wealthy nation on the planet).

This situation constitutes an obvious crisis. You would think that fixing this problem would unite big government skeptics, economic pragmatists, and progressives. Instead we have nothing but finger-pointing. In the meantime, costs continue to balloon (if you'd like to get US health care expenditures in 2015, tack an extra $400 on to the already absurd 2014 figure). We need to find a true, long term solution as soon as possible.

I want to float an innovative solution to our particular challenges, an approach that is market driven, focused on patients and doctors having freedom to make their own decisions, and makes sure that no one is unable to afford treatment when they need it.

The idea is simple. When you go to the doctor, you can chose to pay however you like, but one option will be that you can borrow money to pay the bills from the government, much like how the Department of Education offers student loans. Interest rates can be calibrated so that any such loans don't increase our debt or deficit over the long term.

Based on financial situation, every person will have an expected contribution to their health care each year. Up to that point, if people want health care they must pay for it out of pocket, with private insurance, or by taking advantage of government loans. After that point, however, their expenses are covered, so that the poorest and sickest Americans are able to get care without wracking up so much debt that bankruptcy is inevitable.

If you want to use private insurance, you can. You won't be able to borrow to pay insurance premiums, but money that comes out of pocket for insurance premiums will count toward meeting your expected annual contribution for health care and you can borrow to cover co-pays, deductibles and coinsurance.

But if you don't want insurance at all, that's fine too. You can go without insurance and have a real choice about how much health care you want to consume. Want a regular check up? You can go to any doctor you like, and you have the leverage to get upfront pricing. If the doctor recommends an expensive test or an elective surgery, you can have those procedures done if they are worth it to you, regardless of how much money is sitting in your bank account that day. And you aren't restricted in which doctors or hospitals you go to, because everyone takes cash.

This option puts control back in the hands of doctors and patients. It lets individuals decide what services they want and how much they are willing to pay for those services, but without leaving the most vulnerable with few good options for care. It encourages entrepreneurship by not tying affordable health care to a job. It lets people purchase health care plans tailored to their specific needs, knowing they even if they decide to go with a cheaper premiums and less coverage, they are still protected in a worst case scenario. And it frees doctors up to use their medical judgement when making decisions rather than having to ask insurance companies for permission.

In future posts, I will be comparing this option to some other popular suggestions, and if you have any specific comments, questions, or criticisms about this idea, I would be happy to discuss them. 

Racial Biases Are Pretty Normal

Let’s talk about race in America. It's okay if that subject makes you uncomfortable. Me too! My anxiety has been going through the roof even thinking about this post. But there is a very important point I want to drive home: racial biases are normal and common.

You may be familiar with the term “systemic racism,” which attributes the wide disparity in education levels, incarceration rates, income, etc. to racial biases that are ingrained into our society and our laws. I personally find this theory compelling, but in the social sciences, an observation about outcomes alone is not sufficient to establish the cause of those outcomes. So systemic inequality doesn't, on its own, tell us much about how widespread racial biases are.

On the other hand, experimental evidence clearly establishes the pervasiveness of racial biases. For instance, in 2004 Bertrand and Mullainathan showed that when people where shown resumes with first names that were strongly associated with a certain race, people responded more favorably to names that were common among whites than names that were common among blacks (a more recent study could not replicate the result with last names, but frankly, I think last names are a pretty weak signal of race. Apparently "Jefferson" and "Washington" are more common among blacks, which I suppose sounds right if I think about it carefully, but I seriously doubt that thought would occur to me if I was glancing at a resume). The racial biases also show up clearly in computer based tests: for instance, most white people, it turns out, do much better on tasks that require sorting "bad" words with blacks and "good" words with whites than the other way around.

It is important to establish that racial bias is normal and common because our society has an unhealthy culture of shame and silence when it comes race. Yes, this nation engaged in codified slavery and segregation, and both are morally indefensible. Yes, I believe continuing racial inequality is a very real problem. But people don't have racial biases because they chose to have them. People develop racial biases because as children we watch role models such as parents and teachers act out such biases. In most cases, those adults never intended to teach to pass that lesson on and may not have been aware of their own biases, but children have an incredible capacity to pick up on and emulate subtle behaviors: it's how we learn to construct sentences, tell jokes, make friends, and any other of a myriad of complex social behaviors.

Having biases does not make us bad people. To the contrary, some of the bravest, best people I know will admit to their own biases in public. However, racial biases will not go away by pretending they don't exist. We will pass them on to our children and our grandchildren unless we commit to fighting them.

We should be open to learning about our biases. Harvard has short, publicly available implicit bias tests. As long as you aren't afraid of the result, you might find the tests to be fun. And if you are surprised by the result you get, then know you are in the majority and it doesn't mean you have done anything wrong. What it does mean is that it will take awareness, courage, and effort to combat these biases. Changing ourselves and our culture will be an uphill battle every step of the way, but we must not shrink from the task.