Indiscriminate

Tyler Cowen on Maggie Mahar's Money-Driven Medicine concludes: "Single-payer systems will improve matters only if you think the government will make wise decisions about the supply chain. Otherwise we are choking off supply indiscriminately by lowering prices to providers." I try not to make overly grandiose claims about health care policy because I know full well that it's a complicated subject about which others know more than I. But how bad an idea, really, is indiscriminate supply-choking?

The evidence suggests that health care suppliers are much better at selling people health care services than they are at improving health outcomes. Choke off supply indiscriminately and you can save a lot of money without making people's health outcomes much worse. To generate a significant adverse health impact relative to the status quo, you'd have to be actively trying to produce a bad result. What's more, if you don't quite choke of supply indiscriminately, but instead isolate a relatively small number of services that are uncontroversiall cheap and effective (your proverbial vaccines, pre- and neo-natal care, cholesterol medications) things might actually get better, since poor people underconsume that stuff.

Meanwhile, the range of alternative things to spend money on that would do far more than health care to make people healthier is huge. Better inter-city trains and regional mass transit would mean less driving, which would be a huge life saver. It would also lead to somewhat more walking, which would be good for people. You could subsidize fresh produce, or gym memberships, or build more public pools and better parks to get people to adopt healthier lifestyles. Lead paint abatement. Virtually anything is a potentially more effective means of improving health outcomes than is health care. That's how I see it, at least. I basically stole this idea from Philip Longman who has a somewhat more draconian take on the issue than I do.