Topic: General

For Affordable Health Insurance, Cross the Delaware

My brother (whose name, no joke, is Eugene) just moved to New Jersey with his wife (Katryce) and the two cutest nieces you ever saw (Helaina and Deaven). 

New Jersey is known as health insurance hell, so I went to eHealthInsurance.com to see how much it would cost Euge to purchase a family policy in New Jersey’s highly regulated individual market.  Answer: a lot.  In fact, some of his options cost more than my mortgage.  Meanwhile, our college buddy in Doylestown (Mike) has over five times as many choices for covering his wife and two daughters in Pennsylvania’s individual market.  And the most expensive policy in PA is about the same price as the least expensive plan in NJ.  If Euge were just to move his family in with his old roommate, he could save thousands on health insurance.

…or, Congress could just tear down the senseless trade barriers that keep New Jerseyites from purchasing health insurance from Pennsylvania.

Get the full story here.

Is Bioethics an Oxymoron?

An emailer forwarded me a copy of an article in The New Republic by Ezekiel J. Emanuel, “a bioethicist and oncologist.” Emanuel argues against a recent DC Circuit Court ruling on a suit brought by a group called the Abigail Alliance. The ruling gives dying patients access to experimental drugs after they have passed some minimum safety tests but before they have been proven effective.

It would make it much harder to get people to enroll in research studies and get the data necessary to show whether a drug really was effective or not. Why should people enroll in a randomized, controlled study–where they could be put in the group receiving only conventional treatment–when they could just get their insurance to pay for whatever drug they thought was best?

…Expanded access would also rob the rest of us who may never need a cancer treatment. Individuals and society in general are struggling to pay the nation’s $150 billion-plus drug bill. And that is for medications proven to work. Now add the requirement that insurance companies pay for drugs we don’t know work, and you have a formula for financial disaster. Costs would skyrocket as we pay billions through our insurance premiums and Medicare taxes for worthless drugs.

I agree that it would be wrong to force insurance companies to cover unproven medications–otherwise, there would be no reason to stop individuals from choosing their preferred method of treatment–but the relevant alternative to these patients is not participating in randomized trials. The relevant alternative is death.

Dr. Emanuel describes his approach in a similar case:

Getting Virginia another experimental drug was not going to stop her breast cancer from growing and eventually killing her. I gently explained to her that investing all her energy chasing after another unproven drug was not going to help her and her family. Virginia was disappointed and refused to consider hospice, because she saw it as giving up. Holding her hand, I talked to her about spending time with her husband and daughters and making a videotape for her future grandchildren. We also discussed getting visiting nurses to come to her house. I saw her once more in my office. She was more accepting and found at least some of the activities meaningful. Because of her failing liver, less than three months later, she lapsed into a coma and died with her family present.

If I decide that I want to fight rather than go down graciously with a terminal illness, I will look for a doctor who is not a bioethicist. I found this article so chilling that it leaves me nearly speechless.

Jefferson Was a Great Man, But He Didn’t Write the Constitution

Quotations from respected sources, such as the Founders and Tocqueville and Churchill, are often apocryphal. George Washington apparently didn’t say, “Government is not reason, it is not eloquence – it is force! Like fire, it is a dangerous servant and a fearsome master.” Jefferson, alas, doesn’t seem to have said, “That government is best that governs least,” though he certainly believed it. A tip: If you find the quote on the Internet without any source given other than the alleged speaker, then he probably didn’t say it.

Some quotations are hard to trace, and it’s hard to prove a negative. But this month some of our national leaders have revealed that they don’t know who wrote our most basic founding documents – and neither they nor their speechwriters apparently have access to Google.

At the Southern Baptist Convention two weeks ago, Secretary of State Condoleezza Rice said, “My ancestors in Mr. Jefferson’s Constitution were three-fifths of a man.” Then yesterday Senate minority whip Dick Durbin opposed a flag-burning amendment by saying, “In fact, [flag-burning] rarely, if ever, happens. And so why are we about to change the handiwork and fine contribution to America of Thomas Jefferson?”

Wrong again. Jefferson did not write the Constitution or the Bill of Rights. He was in France during the Constitutional Convention and during the congressional debate over the Bill of Rights.

As every schoolboy knows or should know, James Madison is known as the Father of the Constitution. He also introduced the Bill of Rights into the House of Representatives in 1789. So Rice and Durbin should have referred to “Mr. Madison’s Constitution” and “the handiwork of James Madison.” Perhaps someone should send them a Madison biography or a copy of James Madison and the Future of Limited Government.

‘Breathtaking’ Waste and Fraud in Hurricane Aid

That’s the front-page headline in today’s New York Times. Eric Lipton begins this way:

Among the many superlatives associated with Hurricane Katrina can now be added this one: it produced one of the most extraordinary displays of scams, schemes and stupefying bureaucratic bungles in modern history, costing taxpayers up to $2 billion.

A hotel owner in Sugar Land, Tex., has been charged with submitting $232,000 in bills for phantom victims. And roughly 1,100 prison inmates across the Gulf Coast apparently collected more than $10 million in rental and disaster-relief assistance.

There are the bureaucrats who ordered nearly half a billion dollars worth of mobile homes that are still empty, and renovations for a shelter at a former Alabama Army base that cost about $416,000 per evacuee.

And there is the Illinois woman who tried to collect federal benefits by claiming she watched her two daughters drown in the rising New Orleans waters. In fact, prosecutors say, the children did not exist.

The tally of ignoble acts linked to Hurricane Katrina, pulled together by The New York Times from government audits, criminal prosecutions and Congressional investigations, could rise because the inquiries are under way. Even in Washington, a city accustomed to government bloat, the numbers are generating amazement.

Some of us are impressed but not exactly amazed. When an institution with no incentive for cost-cutting, and little risk of anyone being fired or demoted for malfeasance, sets out to spend money on the principle “It’s going to cost whatever it’s going to cost,” then you can expect plenty of waste, fraud, and abuse.

I noted last September that

Congress passed a $51.8 billion Katrina relief bill on the very day the Associated Press released a study of where the $5 billion small-business relief money after 9/11 went. It found that the funds went to a South Dakota country radio station, a Virgin Islands perfume shop, a Utah drug boutique, and more than 100 Dunkin’ Donuts and Subway shops–“companies far removed from the devastation.” Fewer than 11 percent of the loans went to companies in New York and Washington.

The more things change, the more they remain the same. Big boxes of government money will not be spent wisely. That’s why it’s a good idea to keep as many of society’s resources in the private sector as possible. Private owners have incentives to cut costs, save money, and have more money to spend later. Employees of private companies know that they could be fired for waste and malfeasance, and they know that their company (or even their nonprofit) could go out of business if its costs aren’t managed. Those incentives are almost entirely lacking in the government sector, where resources are acquired coercively and no one has his or her personal funds at stake.

The logical result? “Breathtaking … stupefying … amazing” amounts of boondoggles and bungles.

Health Care Provider Finds No Tragedy in This Commons

An article from the Minneapolis Star-Tribune on competition between physicians and nurse practitioners includes this endearing quote, which encapsulates how some providers see the U.S. health care sector:

The American Medical Association is against giving full autonomy to nurse practitioners, stating as its official policy position that a physician should be supervising nurse practitioners at all times and in all settings…

“There is an element within the physician community that gets a little antsy. … They think it’s going to take away revenue and business from them,” said Dr. Jan Towers, director of health policy for the American Academy of Nurse Practitioners. “Really, there’s more than enough for everybody.”

Cue “We’re in the Money”….

For more, be sure to check out Medicare Meets Mephistopheles, to be released by the Cato Institute in September.

Corruption Squared?

The Kenya head of Transparency International, a respected anti-corruption group, has been fired on the basis of allegations of …. corruption. That follows on the resignation (and departure for the United Kingdom, for understandable reasons) of John Githongo, who had prepared a scathing report on corruption in his capacity as Permanent Secretary for Governance and Ethics in the Office of the President of Kenya. Githongo made a powerful presentation at the Cato Institute shortly after his resignation.

We’ve learned from experience that one way to reduce corruption is to reduce the power of politicians and bureaucrats to create “artificial shortages of freedom” through their powers to approve or withhold permits, permissions, certifications, etc., etc. Limiting the powers of politicians and bureaucrats is not the only measure that will reduce corruption, but it is certainly a central element of a solution to the problem of corruption, theft, and shakedowns.

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“Crisis of Abundance” Makes Executives’ Reading List

The leadership of the National Chamber Foundation (the educational arm of the U.S. Chamber of Commerce) recently recommended to its board of directors a list of 10 “Books that Drive the Debate.”  Among the recommended titles was Crisis of Abundance, a Cato Institute book by adjunct scholar Arnold Kling and the only health policy book to make the list. 

The foundation’s board is a bipartisan group of influential figures from the business, political, and policy spheres.  The NCF also plans to recommend the 10 titles to all Chamber of Commerce members.

The complete list is pasted below.  NCF chairman Bill Little told me today that Crisis of Abundance will be the first book they send out to their board members.

“Books that Drive the Debate”
NCF’s Top 10 Reading Selections

  1. Illicit: How Smugglers, Traffickers and Copycats are Hijacking the Global Economy by Moises Naim
  2. Three Billion New Capitalists: The Great Shift of Wealth and Power to the East by Clyde Prestowitz
  3. The Bottomless Well: The Twilight of Fuel, the Virtue of Waste, and Why We Will Never Run Out of Energy by Peter Huber and Mark Mills
  4. In Our Hands: A Plan to Replace the Welfare State by Charles Murray
  5. Our Brave New World by Charles Gave, Anatole Kaletsky, and Louis-Vincent Gave
  6. The Sarbanes-Oxley Debacle: What We’ve Learned; How to Fix It by Henry N. Butler
  7. An Army of Davids: How Markets and Technology Empower Ordinary People to Beat Big Media, Big Government, and Other Goliaths by Glenn Reynolds
  8. The Innovator’s Solution by Clayton Christensen and Michael Raynor
  9. Crisis of Abundance: Rethinking How We Pay for Health Care by Arnold Kling
  10. Education Myths What Special-Interest Groups Want You To Believe About Our Schools – And Why It Isn’t So by Jay P. Greene

(Another Cato connection: in March, the Cato Institute held a book forum for Glenn Reynolds’ An Army of Davids: How Markets and Technology Empower Ordinary People to Beat Big Media, Big Government, and Other Goliaths.)

The leadership of the NCF evidently agreed with Marginal Revolution publisher Tyler Cowen that Crisis of Abundance “is one of the most important books written on health care.”