May 17, 2022

Health Care Rationing Is Inevitable

How much is a human life worth?  Should a huge percentage of precious health care dollars be allocated for end of life care when adequate health care cannot be provided to children due to budgetary constraints?  Are we crushing the financial future of our children and grandchildren by expending excessive amounts of resources on patients who are terminally ill?  Does every life have an equal value?

These and many other questions arise after viewing a chart of “The Concentration of Health Care Spending.”  The comments on The Incidental Economist website that follow the chart are thought provoking and well worth the read.

courtesy: The Incidental Economist

courtesy: The Incidental Economist

The New York Times author Peter Singer makes a compelling argument on Why We Must Ration 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.

In the current U.S. debate over health care reform, “rationing” has become a dirty word. Meeting last month with five governors, President Obama urged them to avoid using the term, apparently for fear of evoking the hostile response that sank the Clintons’ attempt to achieve reform.

Health care is a scarce resource, and all scarce resources are rationed in one way or another.

The case for explicit health care rationing in the United States starts with the difficulty of thinking of any other way in which we can continue to provide adequate health care to people on Medicaid and Medicare, let alone extend coverage to those who do not now have it. Health-insurance premiums have more than doubled in a decade, rising four times faster than wages. In May, Medicare’s trustees warned that the program’s biggest fund is heading for insolvency in just eight years. Health care now absorbs about one dollar in every six the nation spends, a figure that far exceeds the share spent by any other nation. According to the Congressional Budget Office, it is on track to double by 2035.

President Obama has said plainly that America’s health care system is broken. It is, he has said, by far the most significant driver of America’s long-term debt and deficits. It is hard to see how the nation as a whole can remain competitive if in 26 years we are spending nearly a third of what we earn on health care, while other industrialized nations are spending far less but achieving health outcomes as good as, or better than, ours.

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?

In a utopian world with unlimited resources, the discussion of health care allocation would be irrelevant.  In the real world, the rationing of health care is a discussion that must be initiated as the U.S. rapidly maxes out its credit card.

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