Ration-al Thoughts On Health Care

NY Times Magazine writer Peter Singer has an interesting and informative piece about the issue of health care and rationing, and makes clear the point I myself have made on a number of occasions: the free market already rations health care.

You have advanced kidney cancer. It will kill you, probably in the next year or two. A drug called Sutent slows the spread of the cancer and may give you an extra six months, but at a cost of $54,000. Is a few more months worth that much?

If you can afford it, you probably would pay that much, or more, to live longer, even if your quality of life wasn’t going to be good. But suppose it’s not you with the cancer but a stranger covered by your health-insurance fund. If the insurer provides this man — and everyone else like him — with Sutent, your premiums will increase. Do you still think the drug is a good value? Suppose the treatment cost a million dollars. Would it be worth it then? Ten million? Is there any limit to how much you would want your insurer to pay for a drug that adds six months to someone’s life? If there is any point at which you say, “No, an extra six months isn’t worth that much,” then you think that health care should be rationed.

Which is the point I've made more than a few times. Your ability to afford health insurance and your insurer's willingness to pay for treatment already rations your health care. If you don't have insurance or your insurer says no, then you are being denied treatment, period. Republicans scream "Obamacare will mean bureaucracy gets between you and your doctor!" The idiots must not realize that the bureaucracy is already there, and its chief aim is to in fact find a way to deny the claim and your treatment.

Singer however brings up another point: even a public option will have cost constraints and will have to ration healthcare at some level.

Rationing health care means getting value for the billions we are spending by setting limits on which treatments should be paid for from the public purse. If we ration we won’t be writing blank checks to pharmaceutical companies for their patented drugs, nor paying for whatever procedures doctors choose to recommend. When public funds subsidize health care or provide it directly, it is crazy not to try to get value for money. The debate over health care reform in the United States should start from the premise that some form of health care rationing is both inescapable and desirable. Then we can ask, What is the best way to do it?

Government already rations everything else, so it will have to ration health care as well because the public option will not have unlimited money to pay for everything, that's just reality.

The difference from the public option to private insurers is that private insurers have to make a profit or they go out of business. Government does not. Singer continues into his proposed solution to the dilemma:

This is the basis of the quality-adjusted life-year, or QALY, a unit designed to enable us to compare the benefits achieved by different forms of health care. The QALY has been used by economists working in health care for more than 30 years to compare the cost-effectiveness of a wide variety of medical procedures and, in some countries, as part of the process of deciding which medical treatments will be paid for with public money. If a reformed U.S. health care system explicitly accepted rationing, as I have argued it should, QALYs could play a similar role in the U.S.

Some will object that this discriminates against people with disabilities. If we return to the hypothetical assumption that a year with quadriplegia is valued at only half as much as a year without it, then a treatment that extends the lives of people without disabilities will be seen as providing twice the value of one that extends, for a similar period, the lives of quadriplegics. That clashes with the idea that all human lives are of equal value. The problem, however, does not lie with the concept of the quality-adjusted life-year, but with the judgment that, if faced with 10 years as a quadriplegic, one would prefer a shorter lifespan without a disability. Disability advocates might argue that such judgments, made by people without disabilities, merely reflect the ignorance and prejudice of people without disabilities when they think about people with disabilities. We should, they will very reasonably say, ask quadriplegics themselves to evaluate life with quadriplegia. If we do that, and we find that quadriplegics would not give up even one year of life as a quadriplegic in order to have their disability cured, then the QALY method does not justify giving preference to procedures that extend the lives of people without disabilities over procedures that extend the lives of people with disabilities.

This method of preserving our belief that everyone has an equal right to life is, however, a double-edged sword. If life with quadriplegia is as good as life without it, there is no health benefit to be gained by curing it. That implication, no doubt, would have been vigorously rejected by someone like Christopher Reeve, who, after being paralyzed in an accident, campaigned for more research into ways of overcoming spinal-cord injuries. Disability advocates, it seems, are forced to choose between insisting that extending their lives is just as important as extending the lives of people without disabilities, and seeking public support for research into a cure for their condition.

The QALY tells us to do what brings about the greatest health benefit, irrespective of where that benefit falls. Usually, for a given quantity of resources, we will do more good if we help those who are worst off, because they have the greatest unmet needs. But occasionally some conditions will be both very severe and very expensive to treat. A QALY approach may then lead us to give priority to helping others who are not so badly off and whose conditions are less expensive to treat. I don’t find it unfair to give the same weight to the interests of those who are well off as we give to those who are much worse off, but if there is a social consensus that we should give priority to those who are worse off, we can modify the QALY approach so that it gives greater weight to benefits that accrue to those who are, on the QALY scale, worse off than others.

The QALY approach does not even try to measure the benefits that health care brings in addition to the improvement in health itself. Emotionally, we feel that the fact that Jack Rosser is the father of a young child makes a difference to the importance of extending his life, but his parental status is irrelevant to a QALY assessment of the health care gains that Sutent would bring him. Whether decisions about allocating health care resources should take such personal circumstances into account isn’t easy to decide. Not to do so makes the standard inflexible, but taking personal factors into account increases the scope for subjective — and prejudiced — judgments.

The QALY is not a perfect measure of the good obtained by health care, but its defenders can support it in the same way that Winston Churchill defended democracy as a form of government: it is the worst method of allocating health care, except for all the others. If it isn’t possible to provide everyone with all beneficial treatments, what better way do we have of deciding what treatments people should get than by comparing the QALYs gained with the expense of the treatments?

In other words, Singer is arguing that some rationing will be necessary. Admit it now, work it into the program, and deal with it.

Seems like his idea has merit from a pragmatic point of view as well as an economic one: we're going to have to pay for it.