By Walter E. Williams
“The Dog and His Bone” is one of Aesop’s many instructive fables. It’s about a dog carrying a bone in his mouth.
As he was crossing a footbridge over a stream and happened to glance into the water, he saw his own reflection. Thinking it was another dog with a bigger bone, the greedy dog growled and said to himself, “I’ll get that bone, too.” When he opened his mouth to take the bone, his own bone fell into the water, never to be seen again.
You say, “Williams, that’s a nice story, but what’s the relevance?” Its relevance has to do with the myths and some of the discussion about what to do about our health-care problems. The recently published “Miracle Cure,” by Sally Pipes, president of the San Francisco-based Pacific Research Institute, exposes health-care myths while explaining why the sometimes-touted Canadian style health care isn’t the answer.
Myth: Uninsured individuals have no access to medical care. Fact: It turns out that in 2004 uninsured Americans received $125 billion of health care, of which $41 billion was provided totally free of charge.
Myth: Skyrocketing prescription drugs are driving health-care spending up. Fact: According to the Bureau of Labor Statistics, as a whole, Americans spend about 1 percent of their income on drugs. Seniors spend about 3 percent on drugs, less than the amount they spend on entertainment.
Spending on drugs, as a percent of total health-care spending, was 10 percent in 1960. It’s roughly the same today.
The fact of business is that pharmaceutical spending actually lowers total health-care spending. It often replaces expensive and invasive surgical procedures and the time spent in the hospital. For example, in a yearlong disease-management program, Humana Hospitals studied 1,100 congestive heart-failure patients. While pharmaceutical costs increased by 60 percent, the medications reduced hospital costs by 78 percent — a net savings of $9 million.
Among other myths exposed in “Miracle Cure” is the myth that our health-care problems derive from the fact that we have a free-market health-care system. Little can be further from the truth. The government has been the largest participant in our health-care system since the 1960s.
Today, the government directly pays for 45 percent of health-care spending.
Government intervenes in the form of tax subsidies and costly regulations on private insurers. Regulations imposed on medical practitioners are oppressive. According to a study by PricewaterhouseCoopers, for every four hours a physician devotes to caring for a Medicare patient, hospital administrators spend 30 minutes on Medicare paperwork. For emergency room care, it’s one hour spent on paperwork per one hour spent caring for a patient.
Is Canada better? In her book, Sally Pipes reports the case of 58-year-old Canadian Don Cerniz, who noticed blood in his urine. It took three weeks to get his first test and another month for an MRI, and treatment for his cancer didn’t begin until six months later.
According to the Vancouver, British Columbia-based Fraser Institute’s yearly survey of medical waiting times, Cerniz was lucky: “The median wait for an MRI across Canada was 12.6 weeks. Patients in Prince Edward Island experienced the shortest wait for an MRI (six weeks), while Newfoundland residents waited longest (33.5 weeks).”
Overall, Canada’s total waiting time between referral from a general practitioner to treatment averaged about 18 weeks in 2004.
Americans shouldn’t imitate Aesop’s dog by looking to Canada’s socialized medicine as a solution to our health-care problems and lose what we have. A much smarter move is to repeal previous government-created “solutions” that have marched us nearer to socialism in the provision of medical services. In a word or two, get government out of our hospitals and doctor’s offices.
Walter E. Williams is a professor of economics at George Mason University. He writes for Creators Syndicate and may be contacted at: email@example.com