Tuesday, March 06, 2007

Government Health Care


The present public airing of conditions at Walter Reed army hospital had come as a stunning revelation to many in the U.S. But it probably comes as no surprise to many Brits or Canadians who deal with the universal health care systems there.

I'm not going to go into an argument about whether privately or publicly sponsored health care is better. My own opinion is that neither approach is perfect. The record of privately funded health care has been pretty good for those who can afford it. The record of publicly funded health care has been pretty good for those who can't afford private health insurance... it's a whole lot better than nothing.

The question of whether publicly provided health care is preferable to privately provided health care is somewhat different. This is not a question of where the funding is coming from, but how the health care is delivered.

The issues at Walter Reed remind me of the experiences of my WWII veteran father who received health care through the VA. Remember, soldiers who come out of the military hospital system may be eligible for VA care. Here were my observations:

  • He would not have lived as long as he did without the treatment he received through the VA. He could never have afforded the insurance or the cost of treatments he received during his last decade. All other points after this must be tempered by this reality.
  • He often had to travel over 100 miles to get treatment when he became ill.
  • He often had to wait in long "sign in" lines before he waited in lines to be seen by the doctor; a minor re-check could take all day.
  • Some of the treatment he received was sub-standard. This a a pretty serious charge, but the VA doctors at a nearby Michigan facility were stunned that, after surgery, the Minnesota doctors did not perform the appropriate follow-up treatment which ultimately led to his death. [Would he have died without the surgery; yes. Would he have lived with the appropriate follow-up; perhaps. Was the fact that he was mis-diagnosed delaying the surgery by 6 months a factor; definitely.]
Now anecdotal "evidence" is not data; perhaps it is datum. But it certainly was etched into my mind that "there had to be a better way."

One of the more successful publicly funded health care systems is Medicare. Sure, there are those who say it only works well with supplementation. But it does work.

I have argued on other discussion forums that the VA could be improved by providing eligible veterans with a "VA Health Card" that allowed them to seek treatment from any available hospital, clinic, or family doctor for minor or emergency needs. If longer term care is needed, the veteran would receive that at a VA facility if it is within a reasonable distance (to be defined) or continue receiving treatment locally.

This would accomplish two things:
  • Provide quicker care for the veteran while reducing the workload at the VA for short term care
  • Ensure the veteran receives long term care for chronic problems while focusing VA resources toward ensuring long term care is available.
This certainly doesn't solve the problem for Walter Reed. That's just an administrative mess caused by the normal "processes must come first" mentality of the government at any level and for any mission. But combining the issues of Walter Reed with the anecdotal experience at the VA convinces me that government funding of health care may work, but providing the actual treatment often leaves much to be desired.

So, the next issues are:
  • How would the government fund its role of a super-insurance agency (massive new taxes)?
  • Would it be an expanded medicare program or a whole new agency with new costs?
  • How would eligibility be determined and monitored (come one, come all or restricted to U.S. citizens meeting specific, provable criteria)?
  • How would it affect the way health care is delivered (would it create an administrative nightmare and reduce the system to something like the British or Canadian's)?
If we have learned anything from Walter Reed and the VA, it should be that the government may be well-intentioned, but it puts administration and rules ahead of the mission too often.

Is that what we want?

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There is always an easy solution to every human problem—neat, plausible, and wrong.
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“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
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Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)