Saturday, July 18, 2009

Prices also ration goods and services

Princeton bioethicist Peter Singer has an interesting piece in the NT Times Magazine about rationing health care. On the general point of "rationing", Singer says:
"There’s no doubt that it’s tough — politically, emotionally and ethically — to make a decision that means that someone will die sooner than they would have if the decision had gone the other way. But if the stories of Bruce Hardy and Jack Rosser lead us to think badly of the British system of rationing health care, we should remind ourselves that the U.S. system also results in people going without life-saving treatment — it just does so less visibly. Pharmaceutical manufacturers often charge much more for drugs in the United States than they charge for the same drugs in Britain, where they know that a higher price would put the drug outside the cost-effectiveness limits set by NICE. American patients, even if they are covered by Medicare or Medicaid, often cannot afford the copayments for drugs. That’s rationing too, by ability to pay."
While it seems painfully obvious, the point needs repeating: prices are used to ration goods. So the American healthcare system, which is largely based on individual ability to pay, rations healthcare in this way. Yes, most medical costs are payed by insurers, but insurance is expensive for individuals to buy and employer provided benefits are more generous for higher-payed workers.

No American should oppose any public health plan on the basis that it will ration care. Rather, we should judge policies based on how efficiently and ethically that care is rationed.

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