Sep 23, 2011

Prof. Epstein: Playing the Deathcard in the Healthcare Debate

A Response to Jacob Weisberg
By Richard Epstein

In his recent post on Slate, the intrepid Jacob Weisberg eagerly plays the death card in order to excoriate Republican presidential nominees for their incoherent and cowardly opposition to ObamaCare in the latest primary debate. The hypothetical that we have to address is this:  what should be done with a person without insurance who suffers catastrophic illness, which requires six months of intensive care? Should that person be allowed to die or should that person be supplied that care at public expense under, of course, ObamaCare?

One telling illustration about this example is that Weisberg does not tell us whether the individual who receives this care lives or dies when the treatment is over.  If we assume the latter, the initial question is whether intensive care at, say, $10,000 to $20,000 per day represents the best use of social resources.  A bit of simple arithmetic says that society has spent $1.83 million to $3.66 million on a venture that may well have kept this person alive in a comatose state or have subjected him to repeated invasive treatments when hospice care may well have been preferable. Alternatively, that person could have lived, but we do not know in what kind of state or how much money it will take to sustain him.  In this instance, we might derive somewhat greater benefits, but only at a far greater cost.

The only alternative that is not covered by Weisberg's hypothetical is a case in which intervention is really cost effective: the use of a single day in the intensive care unit that results in keeping a person who suffers from a sudden injury alive so that he or she can return to a normal life thereafter.  The hard question therefore is why is it so apparent to Weisberg or anyone else, that letting a grievously ill person die is the wrong alternative for a society that is determined to make its health care dollars go as far as they want.  Weisberg never addresses this question in a coherent fashion because he is innocent of the notion that high levels of health care expenditures on one individual could exhaust resources that could have enabled many other individuals to survive.  It is just irresponsible to ignore the hard question of scarcity in asking how to set social priorities.

The point has to be put in larger perspective.  The question here is not whether people who lack money should receive health care free of charge.  Of course they should.  But the issue is which people should receive that care, and why?  All of those hard issues are swept under the rug by acting as though nothing else will change if huge levels of resources are devoted to the first person that is carted into the emergency room.  So what kind of institutional arrangements can deal with this issue?

One system that has already shown its defects is the 1986 EMTALA, or the Emergency Medical Treatment and Labor Act, signed by President Reagan. That legislation requires hospitals at their own expense to take in patients that need emergency care or are in active labor, and treat them until stabilized.  Weisberg thinks that this statute is flawed, because these costs are not absorbed by hospitals but are passed on to consumers, employers and the government.

In fact, the economics of EMTALA are far more complex.  In some instances, these costs cannot be passed on, so the hospitals that used to run emergency rooms shut them down, which put more people in peril.  Nor is the issue of whom absorbs the costs the only one that has to be faced.  There is the greater defect that EMTALA requires huge expenditures to be made for the wrong people, so that comatose individuals with little hope or revival, or chronic abusers get first call on social resources, which in turn are no longer available to others.  The simple point about EMTALA is that in its effort to solve the access problem, it aggravates the moral hazard issue, by encouraging reckless or dangerous behavior in individuals who know that they can have care as of right.  The result has not been pretty.  Many ERs have shut down because their hospitals cannot meet the costs.

The provisions under ObamaCare will do nothing to address these difficulties.  The premiums that are paid under the mandate may prove to be insufficient to cover the whole cost of these operations.  The treatments in question may well be given to the wrong people for the wrong reason.  The socialization process that does not work under EMTALA will not work under ObamaCare.

So what then is the solution?  Here it is worth while taking a bit of historical perspective.  The problem of taking care of very sick people did not arise in 1986.  It was with us as a nation throughout our history.  In the early days, there were very few people who were just left callously to die on streets.  Charitable hospitals did open up their doors to supply extensive care even in the days before government reimbursement and tax deductions.

The key to their success was that they had the right to exclude people. That right was important not because they wanted certain patients to die, but because it allowed them to prioritize their care in the manner that they saw fit.  It allowed them, in a word, to decide that hopeless cases and chronic abusers do not receive the same amount of care as others, and perhaps no care at all.  Once they knew that they could use their resources as they saw fit, they could more effectively raise funds from private individuals who did not have to fear government appropriation of moneys through unwise programs.  No one says that this alternative is perfect.  But the greater the number of independent charities, the less likely it is that the failure of mission or purpose of any one of them will bring down the system.

Jacob Weisberg writes as though he, a compassionate person, can put these silly Republicans to shame.  I have no desire to defend their statements, for they don’t seem any more sophisticated than he is.  But it is worth noting that his systematic ignorance of how to deal with scarce resources in end of life situations could have tragic consequences. Put his preferred regime into place and there will be more needless deaths than in a voluntary regime that relies on private compassion and good sense to achieve a result that no set of government mandated programs could hope to match.

- Reproduced with permission from Ricochet

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