health care medical schools insurance doctor salaries

Should Have Been Done Long Ago?
barrier to entry agri-business subsidy fossil fuel tax

Other Ways to Fix Health Care

Since public policy reflects many varied and opposing interests, taxes and subsidies both spur people to make healthy choices and unhealthy ones. Our contributor is a writer and performer in Cleveland OH. His blog on economics and politics can be found at pigouist.blogspot.com.

by Evan Wilhelms, 6 February 2010

After the recent Republican Senate victory in the Massachusetts special election, many are saying any progressive agenda will have to wait, in particular health care reform. This argument presupposes that the Senate’s bill is too progressive in the first place and the outlook of that state, which already has a form of universal coverage, indicates the wishes of the nation.

Even if a Congressional bill is dead, is it our only option? Not really. Consider these:

1. Subsidize medical education. One reason Americans pay more than other nations is our doctors charge far more. Doctors here argue they have to pay their own way through medical school with loans that are repaid through their careers. When you remove the cost of repaying medical school loans, American doctor salaries fall back to a comparable level. Still higher, but comparable.

Would doing this merely shift deficit spending from one budget line to another? Partially. But doctor salaries would no longer excuse for health insurance companies to inflate premiums.

2. Medical schools should accept more students. A lot more. The quantity of new doctors entering the labor market in the US is generally fixed. The AAMC accredits 131 medical schools in the nation, and class sizes don't vary that much. In any other labor market, the high salary of the profession would attract more entrants. With a fixed barrier to entry, the effect is that the salary stays high -- but doctors work exhaustively long hours, with paradoxically limited time to spend with each patient. With more doctors entering the labor force, we will see their hours return to a manageable amount, patients will have more time with them, and their pay will come back down to earth.

3. End agricultural subsidies, tax fossil fuels. When doctors refer to "preventative care," they tend to refer to early detection and evaluating patient risk for illness. What effect is nutritional counseling, for example, with a doctor once a year going to have in comparison to the fact that in grocery stores naturally produced foods can cost more than twice as much as their artificially produced equivalents?

When the nation subsidizes corn production, it means that foods whose calories come largely from corn syrup are cheaper for consumers, so they have incentive to put themselves at risk for conditions such as diabetes. When government underpins cattle raising, which has a heavy ecological footprint, less healthy meat becomes cheaper, so carnivorous consumers increase their risk of getting heart disease.

Instead, by having agri-business and ranchers bear the cost of their heavy footprint, then their food products become the expensive ones. Consumers, saving money, become healthier eaters on a healthier planet.

Likewise, taxing fossil fuels raises the cost of driving. Anytime one bikes to the store instead of drives, they do the same service to themselves and their environment, which returns the favor with cleaner air and reduced lung cancer risk.

By shifting taxes and subsidies, we can incentivize preventative care that works. While debate rages over bills -- some with sensible features such as disallowing rescissions and ensuring coverage for pre-existing conditions -- we can also improve health by tackling the budget’s existing allocations. Let's give less to agri-business and more to medical schools.

JJS: If government were to eventually fund public clinics, and/or private doctors, and/or medical insurance, how could it pay the expense? Well, there are some funds within easy reach. Presently, government issues medical licenses and patents dirt cheap, no more than a filing fee. If we were to run government as a business and charge as much as these privileges are worth in an open market, then doctors, pharmaceuticals, and manufacturers (none of whom are poor), would contribute hundreds of billions more to the public treasury each year.

Doctors (whose AMA over the past decade spent more on lobbying Congress -- $204 million -- than any other professional association but the Chamber of Commerce -- $477 million) like to point out that nothing has raised the standard of living more than medical progress. Could well be so. Yet, wherever life becomes more pleasant, more people want to live there, and so land values rise. Hence another way to fill the public treasury is to shift taxes off our efforts, onto the rental value of locations.

Finally, if government were to fulfill its mandate and protect citizens from polluters, people would enjoy better physical health. And, if government were to enforce our right to a fair share of Earth’s worth and pay citizens a dividend from recovered rents, people, feeling more materially secure, could enjoy better mental health. And better health, of course, reduces medical cost, so even if government were to cover the cost, it’d have much less cost to cover.

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Jeffery J. Smith runs the Forum on Geonomics.

Also see:

There A Mean Streak in the US Mainstream?
http://www.progress.org/2009/insurer.htm

All Rise!
http://www.progress.org/2009/judges.htm

Moyers Interviews Robert Reich on Who Runs Government
http://www.progress.org/2009/insurers.htm

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