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A Rational Look At Rationing

PH2009050100726.jpgIf I were giving members of Congress a homework packet on health reform, David Leonhardt's column on rationing would be at the front of it. There'd be a worksheet on it. And, when they got back to their desks, a quiz. It's important.

"The case against rationing isn’t really a substantive argument," writes Leonhardt. "It’s a clever set of buzzwords that tries to hide the fact that societies must make choices." I'll let Leonhardt explain that to you. I want to focus on his conclusion. "The choice isn’t between rationing and not rationing," he says. "It’s between rationing well and rationing badly."

One way of explaining why health care in America is so expensive is that we pay a very large premium in order to be passive. Rationing, as Leonhardt says, involves making choices. We spend a lot of money to avoid making those choices.

A good example came in the interview Barack Obama gave to, well, David Leonhardt. Obama's grandmother had been diagnosed with terminal cancer. She was given no more than a few months to live. A few weeks after that diagnosis, she fell and broke her hip. The doctor said that the operation to replace her hip might be too much for her heart. It might kill her. But without that operation, her quality of life in these final few months would be very low.

She elected to get the hip replacement. Medicare -- that is to say, the taxpayer -- provided it. Two weeks later, she died. You can argue whether the operation was worth it. But at the time, there was no argument. She made the decision and our taxes paid for her care. However many of those types of treatments we, as a society, would choose not to pay for if we had to make the choice, add up their total cost and you have the premium we pay for passivity. It's not money in order to say "yes" so much as money we spent in order to avoid the possibility of having to say "no."

Want another example? Turn your attention to the dread "waiting lines." A 2001 survey by the policy journal Health Affairs found that 38 percent of Britons and 27 percent of Canadians reported waiting four months or more for elective surgery. Among Americans, that number was only 5 percent. This, Americans will tell you, is the true measure of our system's performance. We have our problems. But at least we don't sit in some European purgatory languishing without our treatments.

There is, however, a flip side to that. The very same survey also looked at cost problems among residents of different countries: 24 percent of Americans reported that they did not get medical care because of cost. Twenty-six percent said they didn't fill a prescription. And 22 percent said they didn't get a test or treatment. In Britain and Canada, only about 6 percent of respondents reported that costs had limited their access to care.

The numbers are almost mirror images of each other. Twenty-seven percent of Canadians wait more than four months for treatment, versus only four percent of Americans. Twenty-four percent of Americans can't afford medical care at all, versus only 6 percent of Canadians.

In Britain and Canada, in other words, they ration actively: The government tells you that the resources are scarce and you'll have to wait. In America, we ration passively: You can't afford the cost of care, and so you go without. But would anyone really prefer never getting care they needed to waiting four months to receive it? But rationing by income means that we don't actually have to decide that people will have to wait, or won't be able to access, care. It just sort of...happens.

But not making a choice is, when you're paying for it, a choice. We haven't explicitly "decided" to spend a fifth of our gross domestic product on a health care system that's twice as expensive as any other country's and leaves 15 percent of our population uninsured. But we've accepted it. We're paying for it.

At the end of the day, no one can argue with the fact that it's nice not to have to make decisions. But it's also expensive. And sooner or later, we're going to have to make a very big decision: Do we really think it's worth it?

(Photo credit: Damian Dovarganes - AP)

By Ezra Klein  |  June 17, 2009; 5:43 PM ET
Categories:  Health Reform , Health Reform For Beginners  
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I've often waited 2-3 months for an appointment, and I have what's considered good insurance. And then there's the bill I've gotten stuck with, more than once, when doctors stopped accepting my insurance right before a follow-up appointment.

One particularly awful doctor kept me waiting for an hour in a paper gown while a drug rep chatted him up and invited him to an "educational" dinner. That last anecdote might sum up everything that's wrong with our medical system, right there. The same doctor got up in my face (wheeled his stool right up to me and leaned way in) and screamed at me when I declined to fill a brand-name prescription I didn't think was necessary.

Posted by: csdiego | June 17, 2009 6:19 PM | Report abuse

Is it called rationing when there aren't enough primary care doctors in an area to see patients? Is it called rationing when a new employer gives you a list of providers you can see with your new insurance, but your previous provider is not on the list? Is it called rationing when you call up your primary care doctor for an appointment but she can't see you for two weeks? Is it called rationing when your current provider informs you that she no longer accepts insurance but would be willing to see you if you can pay out-of-pocket? What is it called when a seriously ill uninsured person goes to the emergency room for care? Hint: it's not called rationing. This is the system we have now. And, it doesn't work all that well and it's hella expensive. Now, say again what's the argument against European-style healthcare if it costs the taxpayers' less?

Posted by: goadri | June 17, 2009 6:41 PM | Report abuse

The British have made substantial progress in reducing waiting times since the 2001 survey you reference.

Posted by: Bloix | June 17, 2009 7:03 PM | Report abuse

About 2 years ago I went to a lecture on medical ethics where the speaker described the difference between the US and other countries like this: in other countries they have decided to manage scarce resources by making these ethical decisions together, as a society. In the US, we make the decisions one at a time, all day long. Generic or brand name, get the test or don't get it, hospice or press on with potentially futile treatment. The end result isn't always ethical. And for any physician trying to swim upstream and be a good steward of resources, it can get very tiring emotionally as well.

Posted by: CarlaKakutaniMD | June 17, 2009 8:19 PM | Report abuse

I'm definitely with you in the camp for explicit rationing of funds. However, I don't see "24 percent of Americans reported that they did not get medical care because of cost" as a bad thing. That's what real rationing is, getting to make the decision as to whether the cost of care is worth it. As the shared cost plans stand, those who try to conserve resources and avoid treatments are crowded out by those who prefer to be overtreated and demand to see a doctor every time they have sniffle. I've decided against treatments for cost reasons. I've decided against treatments and medication due to excessive risk of side effects. Obviously I'm a cheapskate, but my rates tell me I am paying for other people who are less frugal with their use of health care, who lead less healthy lifestyles, who do risky sports and stunts.
How much is my life worth? $1M to get 5 more years? maybe. $100M for 5 more years? probably not.

Posted by: staticvars | June 17, 2009 11:30 PM | Report abuse

It's not just about numbers. Today, in my primary care practice, I saw three
patients who had put off necessary care after losing their insurance.

Ms. F, a working mom with diabetes, cannot afford the premiums for the health plan offered by her employer. Since she has no insurance, she put off coming in for a year, and she had been without medication for most of that time. Last month she was in the hospital for dangerously high blood sugars.

Ms. P has severe hypertension and arthritis. She had also been without medication for 6 months due to costs. She's been putting off a knee operation
for years due to intermittent insurance coverage.

Ms. S had a good job until about two months ago. She also had good insurance. We were able to treat her heroin dependence with state of the art medication. It was a great example of how addiction can be successfully managed like any other medical illness. However, she was laid off, she lost her insurance, and predictably she had relapsed with heroin.

Care for the small percentage of individuals with chronic diseases is what is driving up health care costs. We should be devising systems to optimally manage these chronic diseases and make it easy for these patients to get care. Rationing based on ability to pay is not only unjust, but it also makes no medical or economic sense.

Posted by: DrFox | June 18, 2009 2:49 AM | Report abuse


Avoiding medical care because of costs IS a bad thing when it is necessary care. We know from studies that even small copayments for mammograms reduce rates of mammography. Higher out of pocket costs for medications are associated with lower rates of adherence. People who are sick or are poor are at greatest risk of going without necessary care due to costs. According to the RAND health insurance experiment, health care consumers do not make rational choices about what care is superfluous when it comes to costs. If there are financial barriers, patients reduce all care - both necessary and unecessary.

Posted by: DrFox | June 18, 2009 3:02 AM | Report abuse


The only way what you're saying could make sense would be if everyone in the US actually had enough money to pay for all the medical care they deemed appropriate. Then the statistic that 24% of people failed to get care because of cost would translate to "they didn't think it was worth it."

But if you don't have the money and can't beg or borrow it, it really doesn't matter how worthwhile the care is, and how many thousands of dollars in future costs you would avoid by having proper care now. Hence, rationing by whether people have the money or the insurance coverage is incredibly stupid and ultimately more expensive.

Posted by: paul314 | June 18, 2009 10:27 AM | Report abuse

Shorter staticvars: "let them eat vitamins."

Posted by: pseudonymousinnc | June 18, 2009 2:27 PM | Report abuse

Back in the old days, when people had steady employment and insurance came with our jobs, we were not covered for out-patient doctor appointments (other than surgical procedures), and we weren't covered for pharmaceuticals. But one a person got sick and sent for a stay in the hospital, everything was taken care of, inclusively. In other words, these were catastrophic policies.

Then, some time in the seventies, the people in charge began to realize that this sort of system basically contravened preventive care, and so they instituted more complete insurance policies that paid for doctor visits, laboratory tests, and a large percentage of drug costs. Of course this drove the cost of a policy up, but the intention was to save money with preventive measures so as to avoid more extensive interventions at a later date. In other words, insulin instead of an amputation.

So we've already had rationing in this country. Forty years ago we rationed preventive care, leaving it up to the patient. Today HMOs ration care too. They do it by dawdling, using a triage system to trigger prompt attention. When i was diagnosed with hepatitis C, I had an appointment with a specialist within a week, a liver biopsy a few weeks later, and treatment a few weeks after that, and was cured. But when I had a big toe that didn't bend very much (and made iwaling difficult) I had to wait three or four months for scheduled surgery. That's okay. I can deal with that if it keeps costs down.

A proactive patient, furthermore, can override rationing in many cases. When I broke a knee, knowing that I'd only get a fiberglass splint with velcro because of my age (old), I told a white lie and said I'm a jock, that I had to come out of this with complete flexibility. I received a cast and more physical therapy than my insurance company usually offers. The squeaky wheel gets greased.

But really, I understand the need for rationing - as long as it's on a case-by-case basis, not according to rigid rules. I would be very angry if the rules reflected age rather than health status. I know 75 years olds who climb mountains, and I know 60 year olds who can barely rise from a chair. Who gets the kidney?

Posted by: barbara23 | June 19, 2009 4:54 AM | Report abuse

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