Posted by: bkivey | 1 April 2010

“We Will Pay the Price, But We Will Not Count the Cost”

On 28 March The Oregonian published a fascinating article by Amanda Bennett on her husband’s struggle with, and eventual demise from, kidney and lung cancer. The article primarily focused not on her personal and family struggles during the five years of her husband’s illness and treatment, but on her post-mortem assessment of how the health care system had functioned. Ms. Bennett appears to be an intelligent and thoughtful person and as she details their struggle she makes clear that every health care decision her family faced was motivated not by cost of treatment but by the desire to extend life. The desire to live is fundamental and no sane person could fault her or her family for the decisions they made.

But Ms. Bennett is very aware of the costs of her husbands care, a total billed amount of $618,616, two-thirds of which she says was incurred in the last two years of her husband’s life. She questions the cost/price structure of the health care system. In a telling passage she points out:

“Looking at that stack of documents, it is easy to see why 31 percent of the money spent on health care went to paperwork and administration.

The documents reveal an economic system in which the sellers don’t set the prices and the buyers don’t know what they are. Prices bear little resemblance to demand or how well goods and services work.”

She points out that the total bill was discounted to $254,176, a reduction of 59%, and that their share came to $9,468, or 1.5% of the billed amount,  and just under 4% of the actual amount.

How can this be?

Ms. Bennett’s story illustrates some of the fundamental tensions that exist in society’s relationship with modern medicine, and she illustrates them in her article.

The first is that in the last several decades medical research has made possible amazing advances in survival rates for previously incurable conditions, but at a very high cost. She talks about how aggressive treatment and cutting-edge drugs gave her husband years that he wouldn’t have had not so long ago. But she also points out how expensive medical care is for those at the end of life, stating that Medicare spends one-quarter of its budget on care for those in the last year of life. As an illustration I obtained the figures for the Medicare budget in FY2006 and the death rates for those over age 65 in the same year. 2006 is the latest year for which I could find reliable figures for both metrics, and it falls in the middle of the timeframe for her story. In Fy2006 the Medicare budget was 340 billion dollars. In calender year 2006 1,643,600 people over age 65 died for reasons not related to accidents or homicide. If one-quarter of the Medicare budget was spent in the last year of life, then the Federal government in 2006 spent just over $51,000 on each person under Medicare in the last year of their life. I would bet that figure is higher now.

The second thing she points out is morality of asking healthy people to subsidize the treatment of terminally ill patients by methods of sometimes questionable efficacy. She mentions that at one point her husband was prescribed a drug that was billed out at $27,360 per dose while her insurance company paid $6,566.

We paid nothing. So who did the paying? The health insurance system depends on healthy people bearing the cost of sick ones like Terrance. For all its incredible treatment benefits, the system is untenable. Should you have had a voice in Terrence’s final days? Would I make the same decision with my money for your loved ones? These are things I think about now but cannot answer.

If we didn’t think about these thing before we sure as heck are going to have to now, and as we have seen in places that have full-on socialized medicine, the answers aren’t pretty. It is not uncommon for people with conditions like her husband in these places to be denied drugs and treatment that might extend their lives because they are too expensive; the cost/benefit ratio is unfavorable.  The tradeoff is that for reduced-price medical care earlier in life you will not get aggressive care when things go really wrong. Maybe the State will pay for some nice flowers for your hospice room.

Here we get to the real reason many people are opposed to state-run medical care and it’s one I have pointed out in previous posts: when the state is in charge of your medical care, then everything you do becomes the state’s business and you essentially become state property. Dont’ want to buy a health care plan when you’re 25 so we can subsidize the care of someone who’s 75? Can’t have that, boy. Why, you’re a clear threat to society and we’ll have to tax you or throw you in jail. The morality of holding a gun to someone’s head and taking money from them just because they live escapes me.

We as a society are going to have to face up to some tough choices. If we want society to take care of us then we are going to have to expect that society will demand a say in how we live our lives. As I’ve pointed out before, the flip side of “It’s my life.” is “It’s your responsibility.” What I fear we are moving towards is what places like Canada and Great Britain have already discovered: there are going to be people who abuse their bodies for 30 or 40 years and then when they need extensive and expensive medical care they expect the state to care for them without obligation. People are going to expect aggressive life-extending measures when they get seriously ill because they’ve paid into the system their entire lives; been told what they can eat, what they can do. To hell with the cost; I’ve paid the price.

At the end of her article Ms. Bennett says that her husband’s course of treatment gave him about a year of life that he wouldn’t have had otherwise. She also says that she would ‘absolutely’ follow the same course of action again. She and her husband enjoyed the freedom to make those decisions, freedom some in this country want to take away. Perhaps they can answer her questions.


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