Wednesday, August 04, 2004

Socialized Health Care

Universal health care has been a political talking point for some time. These days, with the election right around the corner, it's once again heating up. Kerry, and much of the left are proclaiming that socialized medicine is now the only recourse for the current problems with America's health care system. Those on the far left have gone so far as to even call it a crisis. I wasn't going to do much on this honestly, but I was inspired by a conversation with an individual posting at the Christian Conservative,specifically, this post. It started with Mike simply disussing his new bumber sticker (very good BTW), and ended with a slightly heated argument that started here.

There are many problems with socialized healthcare, almost too many to mention. But I'll give it the old college try, just for my loyal readers. Actually, to perfectly honest, I'm gonna let others do the work for me. I'm just lazy like that;-) Let's start with this article from 1994 on healthcare in the former Soviet Union, regarding their "cradle to grave" healthcare system.

Socialized Health-Care Nightmare
Published in The Freeman: Ideas on Liberty - November 1994
by Yuri N. Maltsev and Louise Omdahl

Dr. Maltsev gained his insight as an adviser to the last Soviet government on issues of social policy, including health care, and as a patient in the system. He teaches at Carthage College in Kenosha, Wisconsin. Louise Omdahl, a nursing educator and manager, is actively involved in humanitarian assistance through nursing contacts in Russia and has visited numerous Russian health-care facilities.

In 1918, the Soviet Union’ s universal “cradle-to-grave” health-care coverage, to be accomplished through the complete socialization of medicine, was introduced by the Communist government of Vladimir Lenin. “Right to health” was introduced as one of the “constitutional rights” of Soviet citizens. Other socioeconomic “rights” on the “mass-enticing” socialist menu included the right to vacation, free dental care, housing, and a clean and safe environment. As in other fields, the provision of health care was planned and delivered through a special ministry. The Ministry of Health, through its regional Directorates of Health, would pool and distribute centrally provided resources for delivery of medical and sanitary services to the entire population.

The “official” vision of socialists was clean, clear, and simple: all needed care would be provided on an equal basis to the entire population by the state-owned and state-managed health industry. The entire cost of medical services was socialized through the central budget. The advantages of this system were proclaimed to be that a fully socialized health-care system elimi nates “waste” that stems to “unnecessary duplication and parallelism” (i.e., competition) while providing full coverage of all health-care problems from birth until death.

But as we have learned from our own separate experiences, the Russian health care system is neither modern nor efficient.

In contrast to the impression created by the liberal American media, health-care institutions in Russia were at least fifty years behind the average U.S. level. Moreover, the filth, odors, cats roaming the halls, and absence of soap and cleaning supplies added to an overall impression of hopelessness and frustration which paralyzed the system. The part of Russia’s GNP destined for medical needs is negligible[1] and, according to our estimates; is less than 2.5 percent (compared to 14 percent in the United States, 11 percent in Canada, 8 percent in the U.K., etc.).

Polyclinics and hospitals in big cities have extremely large numbers of beds allotted for patients reflecting typical megalomania of bureaucratic planning. The number of beds in big cities would usually range from 800 to 5,000 beds. Despite the difference in average length of stay, less than one-half were utilized. In the United States hospital stays for surgery are three to seven days; in Russia stays average three weeks. American mothers typically leave the hospital a day or two after giving birth. New mothers in Russia remain for at least a week. It was explained that the length of stay was necessary due to unavailability of follow-up care after hospitalization. A physician was reluctant to discharge a patient before the majority of healing had occurred. In addition, there was no financial incentive for early discharge, as reimbursement was directly related to number of “patient-days,” not the necessity for those days.

Scarce Supplies, Inadequate Personnel

Supplies are painstakingly scarce—surgeries at a major trauma-emergency center in Moscow that we observed had no oxygen supply for an entire floor of operating rooms. Monitoring equipment consisted of a manual blood pressure cuff, no airway, and no central monitoring of the heart rate. Intravenous tubing was in such poor condition that it had clearly been reused many times. The surgeon’s gloves were also reused and were so stretched that they slid partially off during the surgery. Needles for suturing were so dull that it was difficult to penetrate the skin. All of this took place in 95 degree F temperature with unscreened windows open; though the hospital was built less than twenty years ago, there was no air conditioning.

Utilization of medical/nursing personnel was very different from our model. The ratio of nurses to patients in the ordinary hospitals was 1 to 30, compared to 1 to 5 in the United States. Duties of the nurse ranged from housekeeping to following medical orders. When asked for her “best nurse,” a head nurse in Moscow helped a young woman up from scrubbing the floor. Five minutes later she was practicing intravenous insertions with equipment donated by us. Both of these functions were in her “job description,” however unofficial that may be. Nurses are unlicensed and are not considered an independent profession in Russia. As a result, all their duties are delegated, with assessment and most documentation completed by physicians. The education of nurses occurs at an age comparable to the last two to three years of American high school.[2] Nurses are educated by physicians, not other nurses. A separate body of scientific knowledge in nursing does not exist.

The role of a patient advocate, heavily assumed by nurses in the United States was distinctly lacking in Russia. Nurses were subjugated to medical bureaucracy. Patients’ rights and patients’ privacy were all but ignored. There is no legal mechanism to protect patients from malpractice. To our amazement we were asked to photograph freely in patient-care settings without seeking patient consent. Patient education and informed consent were dismissed by the socialized system as an unnecessary increase in time and the cost of care. If the society does not respect individual rights in general, it would not do it in hospitals. The Russian medical oath protects the “good of the people,” not necessarily the “good of the person.”[3]

Apathy and Irresponsibility

Widespread apathy and low quality of work paralyzed the health-care system in the same way as all other sectors of Russian economy. Irresponsibility, expressed by a popular Russian saying (“They pretend they are paying us and we pretend we are working.”) resulted in the appalling quality of the “free” services, widespread corruption, and loss of life. According to official Russian estimates, 78 percent of all AIDS victims in Russia contracted the virus through dirty needles or HIV-tainted blood in the state-run hospitals. To receive minimal attention by doctors and nursing personnel the patient was supposed to pay bribes. Dr. Maltsev witnessed a case when a “non-paying” patient died trying to reach a lavatory at the end of the long corridor after brain surgery. Anesthesia usually would “not be available” for abortions or minor ear, nose, throat, and skin surgeries, and was used as a means of extortion by unscrupulous medical bureaucrats. Being a People’s Deputy in the Moscow region in 1987-89, Dr. Maltsev received many complaints about criminal negligence, bribes taken by medical apparatchiks, drunken ambulance crews, and food poisoning in hospitals and child-care facilities.

Not surprisingly, government bureaucrats and Communist party officials as early as 1921 (two years after Lenin’s socialization of medicine) realized that the egalitarian system of health care is good only for their personal interest as providers, managers, and rationers, but not as private users of the system. So, in all countries with socialized medicine we observe a two-tier system—one for the “gray masses,” and the other, with a completely different level of service for the bureaucrats and their intellectual servants. In the USSR it was often the case that while workers and peasants would be dying in the state hospitals, the medicines and equipment which could save their lives were sitting unused in the nomenklatura system.[4]

A “Privileged Class”?

Western admirers of socialism would praise Russia for its concern with the planned” scientific” approach to childbearing and care of children. “There is only one privileged class in Russia—children,” proclaimed Clementine Churchill on her visit to a showcase Stalinist kindergarten in Moscow in 1947. The real “privileged class”-Stalin’s nomenklatura—were so pleased with the wife of the “chief imperialist” Winston Churchill that they awarded her with an “Order of the Red Banner.” Facts, however, testify to the opposite of Mrs. Churchill’s opinion. The official infant mortality rate in Russia is more than 2.5 times as large as in the United States and more than five times that of Japan. The rate of 24.5 deaths per 1,000 live births was questioned recently by several deputies to the Russian Parliament who claim that it is seven times higher than in the United States. This would make the Russian death rate 55 compared to the U.S. rate of 8.1 percent per 1,000 live births. In the rural regions of Sakha, Kalmykia, and Ingushetia, the infant mortality rate is close to 100 per 1,000 births, putting these regions in the same category as Angola, Chad, and Bangladesh. Tens of thousands of infants fall victim to influenza every year, and the proportion of children dying from pneumonia is on the increase. Rickets, caused by a lack of vitamin D and unknown in the rest of the modern world, is killing many young people.[5] Uterine damage is widespread, thanks to the 7.3 abortions the average Russian woman undergoes during childbearing years.

After seventy years of socialist economizing, 57 percent of all Russian hospitals do not have running hot water, while 36 percent of hospitals located in rural areas of Russia do not have water or sewage. Isn’t it amazing that socialist governments, while developing sophisticated systems of weapons and space exploration would completely ignore basic human needs of their citizens?”It was no secret that on many occasions in the past 70 years, workers’ health had been sacrificed to the needs of the economy—although the cost of treating the resulting diseases had eventually outweighed the supposed gains,”[6] stated Russian State Public Health Inspector E. Belyaev.

Man-made ecological disasters like catastrophes at nuclear power stations near Chelyabinsk and then Chernobyl, the literal liquidation of the Aral Sea, serious contamination of the Volga River, Azov Sea and great Siberian rivers, have made unbearable the quality of life both in the major cities and the countryside. According to Alexei Yablokov, the Minister for Health and Environment of the Russian Federation, 20 percent of the people live in “ecological disaster zones,” and an additional 35-40 percent in “ecologically unfavorable conditions.”[7] As a sad legacy of the socialist experiment, we observe a marked decline in the population of Russia and experts predict a continuation of this trend through the end of the century. From Russian State Statistical Office data, it appears that in 1993 there were 1.4 million births and 2.2 million deaths. Because of inward migration of Russians from the “near abroad”—former “republics” of the Soviet empire, the net fall in population was limited to 500,000. The dramatic rise in mortality and significant decline in fertility is attributed primarily to the appalling quality of health services, and the deteriorating environment. The head of the Department of Human Resources reckons that the fertility index will remain at around 1.5 until the end of the century, whereas an index of 2.11 would be necessary to maintain the present population.[8] But, “the only lesson of history is that it does not teach us anything” says a popular Russian aphorism. Despite the obvious collapse of socialist medicine in Russia, and its bankruptcy everywhere else, it is still alive and growing in the United States. It possesses a mortal danger to freedom, health, and the quality of life for us and generations to come.

Incentives Matter

The chief reason for the dire state of the Russian health-care system is the incentive structure based on the absence of property rights. The current lack of goods and education within health care has caused Russians to look to the United States for assistance and guidance. In 1991 Yeltsin signed into law a Proposal for Insurance Medicine.[9] The intent is to privatize the health- care system in the long run and decentralize medical control. “The private ownership of hospitals and other units is seen as a critical determining factor of the new system of ‘insurance’ medicine.”[10] It is moving to the direction the United States is leaving—less government control over health care. While national licensing and accreditation within health-care professions and institutions are still lacking in Russia, they are needed for self-governance as opposed to central government control.

Decay and the appalling quality of services is characteristic of not only “barbarous” Russia and other Eastern European nations, it is a direct result of the government monopoly on health care. In “civilized” England, for example, the waiting list for surgery is nearly 800,000 out of a population of 55 million. State of the art equipment is non-existent in most British hospitals. In England only 10 percent of the health-care spending is derived from private sources. Britain pioneered in developing kidney dialysis technology, and yet the country has one of the lowest dialysis rates in the world. The Brookings Institution (hardly a supporter of free markets) found 7,000 Britons in need of hip replacement, between 4,000 and 20,000 in need of coronary bypass surgery, and some 10,000 to 15,000 in need of cancer chemotherapy are denied medical attention in Britain each year.[11] Age discrimination is particularly apparent in all government-run or heavily regulated systems of health care. In Russia patients over 60 years are considered worthless parasites and those over 70 years are often denied even elementary forms of the health care. In the U.K., in the treatment of chronic kidney failure, those who were 55 years old were refused treatment at 35 percent of dialysis centers. At age 65, 45 percent at the centers were denied treatment, while patients 75 or older rarely received any medical attention at these centers. In Canada, the population is divided into three age groups—below 45; 45-65; and over 65, in terms of their access to health care. Needless to say, the first group, who could be called the “active taxpayers,” enjoy priority treatment.

Socialized medicine creates massive government bureaucracies, imposes costly job-destroying mandates on employers to provide the coverage, imposes price-controls which will inevitably lead to shortages and poor quality of service. It could lead to non-price rationing (i.e., based on political considerations, corruption, and nepotism) of health care by government bureaucrats. Socialized medical systems have not served to raise general health or living standards anywhere. There is no analytical reason or empirical evidence that would lead us to expect it to do so. And in fact both analytical reasoning and empirical evidence point to the opposite conclusion. But the failure of socialized medicine to raise health and longevity has not affected its appeal for politicians, administrators, and intellectuals, that is, for actual or potential seekers of power.

Got a headache yet? Well, pop you some aspirin, cuz there's more. Want some commentary a little more current? Go to the town hall and see what Walter E. Williams says about it. If you don't want to read the whole thing, here's a short paraphrase that pretty much sums it all up:

Some patients avoided long waits for medical services by paying for private treatment. In 2003, the government of British Columbia enacted Bill 82, an "Amendment to Strengthen Legislation and Protect Patients." On its face, Bill 82 is to "protect patients from inadvertent billing errors." That's on its face. But according to a January 2004 article written by Nadeem Esmail for the Fraser Institute's Forum and titled "Oh to Be a Prisoner," Bill 82 would disallow anyone from paying the clinical fees for private surgery, where previously only the patients themselves were forbidden from doing so. The bill also gives the government the power to levy fines of up to $20,000 on physicians who accept these fees or allow such a practice to occur. That means it is now against Canadian law to opt out of the Canadian health-care system and pay for your own surgery.

But for a more complete look at the matter, go over to Angel Fire and take a look around the links posted up. There you can find links to healthcare statistics in Canada, Great Britian, and other European countries. Among the main talking points:

1) Destroys patient incentives to find the best possible prices for the best possible services/products available.
I have worked in the healthcare field for the past ten years and I see a majority of patients who currently receive "free" (read: taxpayer-funded) healthcare continually seek care for the most minor afflictions. Why wouldn't they? It's "free" to them so they visit the doctor's office several times a month. "Free" prescriptions for over-the-counter medication such as Tylenol are very common. Patients who refuse to wait for an appointment make their way to the ER for things such as headaches and aches.

The current U.S. half socialism/half free-market healthcare system also decreases incentives to "shop around" for people who are not receiving direct taxpayer-funded care. If you are paying a set amount per month and your copay is ten dollars per office visit no matter where you go, why bother to look for a better price? Government imposed wage controls during the 1940's carry a large part of the blame for this current state of affairs. Unable to offer competitive salaries, companies started to offer healthcare benefits as a way to lure prospective employees into jobs.

2) Destroys physician incentives to provide competitive care and destroys drug companies' incentives to provide new drugs and treatments.
With no competition and with a constant assurance of taxpayer money, providers and companies become unresponsive to peoples' needs and wants. Think of the U.S. Post Office or the U.S. Department of Transportation.

3) Steals from your wallet to pay for my health care.
Yes, you do have a right to healthcare, just as you have a right to food, shelter and property. However, you have no "right" to force others to provide these things for you - All "free" medical care is paid for through taxes stolen from other people. I know of one seemingly healthy individual who went to his physician's office 51 times in 26 months. He receives "free" health care from the State, so his trips did not cost him a dime. Who pays for his medications? Who pays for the physicians', nurses' and office staff wages during his visits?

4) The quality of "free" health care will deteriorate and the average citizen will get sicker.
As the poor and middle-class wait in agony for simple procedures, those with resources can travel to other countries for treatment. But hey, your moral arrogance and justification of coercion makes you feel good, doesn't it?

5) Destroys your privacy.
Suddenly your problems are mine and mine are yours. If you are eating unhealthy foods or go skydiving, I have a direct interest in your business - you are going to see a doctor on my paycheck. Your neighbors might support government bans on smoking, "unsafe" sex or other "risky" behaviors to reduce costs.

6) Destroys your liberty.
When you blindly support a system that gives politicians and bureaucrats the power to force others to follow a plan, those politicians and bureaucrats will receive their orders from those with the most money - and you can guarantee this will not be you, your friends or your family. The power of government will be used against you as you are forced to use medicines or accept treatments from well-connected health care companies.

A quick search shows that the pharmaceutical companies gave $29,370,351 to political campaigns in 2002. Who do you think has the ear of those elected politicians? You?

On the other hand, if government power is eliminated (e.g., abolish the FDA - whose restrictions benefit the most powerful companies by eliminating most competition), those same companies would have to use their funds and resources to sell their drugs to the most people in the least expensive, most reliable and safest way. They would need to outperform their competitors to get your money - otherwise they lose business.

Myself, I could go on and on about how bad a "universal healthcare" system would be, but the information above pretty much covers it. Not to mention everything I've posted should keep you all busy for the better part of an afternoon.

So Ellbur, if you happen to come over and read this, this one's for you sir. As always, enjoy and live free!