It Is Not Likely That Government Will Make Health Care More Efficient

See New Efficiencies in Health Care? Not Likely: If the British experience is any indication, generic drugs and expert commissions will do little to lower costs, by THEODORE DALRYMPLE (the pen name of the physician Anthony Daniels. He is a contributing editor of the Manhattan Institute's City Journal). From the WSJ, 4-16-11. He discusses the experience in the UK. Excerpts:

"It turned out, however, that the costs of prevention were decidedly real, while the savings were inclined to be imaginary. This was for more than one reason. The bureaucratic costs of setting and monitoring health-improvement targets—which were often highly arbitrary—were far greater than anticipated, bureaucracies having an inherent tendency to increase in size and spending power. Many doctors started to be paid for procedures that they were already doing for no charge, like taking their patients' blood pressure. Screening procedures turned out to be highly equivocal in their efficacy. Thus the overall benefit was much less than anticipated. Some of the more common ills that had been targeted, such as strokes and heart attacks, were in marked decline anyway.

Worse, much of the expenditure on the treatment of disease proved intractable. Technology inexorably increased costs; and even if the health of the population improved rapidly, so that 70 was the new 60, 60 the new 50 and so forth, the proportion of old people in the population meant that the proportion of people ill with expensive chronic diseases increased. In the U.S., there were 37 million people over 65 in 2006, just over 12% of the population. That figure is projected to rise to 71 million, or 20%, by 2030."

"The long-term solution, I imagine, is the same for health care as it is for pensions: to pay for it with the income generated by dedicated savings accounts, which can be transferred to the next generation after death. The important thing is to reduce the insurance element, which encourages a pay-as-you-go system, a kind of Madoff scheme ensnaring the whole country."