Comments on: Economics of Medicine – Carl Peter Klapper http://johnsonvillepress.com/2009/08/25/economics-of-medicine-carl-peter-klapper/ New Brunswick, New Jersey, Just Off Exit 9... Fri, 19 Mar 2010 04:55:12 -0400 http://wordpress.org/?v=2.8.4 hourly 1 By: Carl Peter Klapper http://johnsonvillepress.com/2009/08/25/economics-of-medicine-carl-peter-klapper/comment-page-1/#comment-9310 Carl Peter Klapper Sun, 13 Sep 2009 20:37:18 +0000 http://johnsonvillepress.com/?p=459#comment-9310 But what makes that equipment so expensive? What other competitive use would the MRI machine be put to? What sort of demand in dollars would be placed in the market from an alternative use, even one such as airport security? What you have not considered is that the prices of things do not exist in a vacuum. Without the inflationary demand for all things medical created by health insurance, none of the medical equipment and supplies you mentioned would be anywhere near as expensive as it is today. Moreover, many fire departments have EMS squads with complex and currently expensive equipment. They are roughly in the position of the Navy and Army Air Forces before a separate US Air Force was created. As the other service air forces showed the feasibility of national air force, the EMS squads show that MMDs can be run successfully at the municipal level. But let's take your worst case example from the standpoint of capacity rather than cost. What if some plague hits the little country hamlet? That eventuality would have been planned for in the same way as a brush fire might be planned for by fire departments and a breakdown of order with mobs of looters and marauders might be planned for by police departments. Larger municipalities such as townships and counties, and the state or federal government, if necessary, would provide additional and/or specialized support in personnel, equipment and supplies, while neighboring municipalities would have cooperative agreements in an emergency. Stockpiles of equipment and supplies bought, say, at the state level at discount rates would be available to the MMDs in a crisis. And, yes, stockpiling is a time-tested and efficient alternative to insurance since the days of Joseph and the Pharoah. Insurance of whatever size is definitely not the answer for health care and other kinds of local public service. It is most definitely not the answer for any massive calamity, as the "act of God" provisions clearly show. Where insurance works is for events whose occurrence does not affect the value of the payout. Property insurance in the event of fire, theft or flood is paid out in dollars. If the value of dollars is affected by fire, theft or flood, it is one of the great missed investment opportunities of our times; but most likely it is not. Property insurance works wonderfully well. However, this is not the case with health insurance, as I made quite clear in my article, and consequently this insurance has produced a hyperinflation in the value of the payout, namely medical care. Therefore, I can say unequivocally that a true reform of health care cannot, in any way, shape or form, include a role for health insurance. But what makes that equipment so expensive? What other competitive use would the MRI machine be put to? What sort of demand in dollars would be placed in the market from an alternative use, even one such as airport security? What you have not considered is that the prices of things do not exist in a vacuum. Without the inflationary demand for all things medical created by health insurance, none of the medical equipment and supplies you mentioned would be anywhere near as expensive as it is today.

Moreover, many fire departments have EMS squads with complex and currently expensive equipment. They are roughly in the position of the Navy and Army Air Forces before a separate US Air Force was created. As the other service air forces showed the feasibility of national air force, the EMS squads show that MMDs can be run successfully at the municipal level.

But let’s take your worst case example from the standpoint of capacity rather than cost. What if some plague hits the little country hamlet? That eventuality would have been planned for in the same way as a brush fire might be planned for by fire departments and a breakdown of order with mobs of looters and marauders might be planned for by police departments. Larger municipalities such as townships and counties, and the state or federal government, if necessary, would provide additional and/or specialized support in personnel, equipment and supplies, while neighboring municipalities would have cooperative agreements in an emergency. Stockpiles of equipment and supplies bought, say, at the state level at discount rates would be available to the MMDs in a crisis. And, yes, stockpiling is a time-tested and efficient alternative to insurance since the days of Joseph and the Pharoah.

Insurance of whatever size is definitely not the answer for health care and other kinds of local public service. It is most definitely not the answer for any massive calamity, as the “act of God” provisions clearly show. Where insurance works is for events whose occurrence does not affect the value of the payout. Property insurance in the event of fire, theft or flood is paid out in dollars. If the value of dollars is affected by fire, theft or flood, it is one of the great missed investment opportunities of our times; but most likely it is not. Property insurance works wonderfully well.

However, this is not the case with health insurance, as I made quite clear in my article, and consequently this insurance has produced a hyperinflation in the value of the payout, namely medical care. Therefore, I can say unequivocally that a true reform of health care cannot, in any way, shape or form, include a role for health insurance.

]]> By: W.K. Mallon http://johnsonvillepress.com/2009/08/25/economics-of-medicine-carl-peter-klapper/comment-page-1/#comment-9244 W.K. Mallon Thu, 10 Sep 2009 18:47:33 +0000 http://johnsonvillepress.com/?p=459#comment-9244 So you propose the complete government takeover of health care on a local level? The problem with your discussion on prices is that it leaves out the consideration of medical supplies and tools. Just look up the cost of an MRI machine. The infrastructure of medicine is incredibly more complex than that of a fire department. Routine procedures such as angiograms can cost thousands of dollars in supplies alone. The example of a house call doesn't mean anything because that type of medicine doesn't exist anymore. What happens if several local residents of a town have some aggressive form of cancer that require tens of thousands, if not millions of dollars of treatment and the town is rural and not very wealthy? The answer under your idea would be bankruptcy of the town. Large-scale insurance is the answer, and preferentially that of a state-run non-profit agency which is only beholden to saving the taxpayers money when possible instead of reaping profits for investors at the expense of the insured. So you propose the complete government takeover of health care on a local level? The problem with your discussion on prices is that it leaves out the consideration of medical supplies and tools. Just look up the cost of an MRI machine. The infrastructure of medicine is incredibly more complex than that of a fire department. Routine procedures such as angiograms can cost thousands of dollars in supplies alone. The example of a house call doesn’t mean anything because that type of medicine doesn’t exist anymore. What happens if several local residents of a town have some aggressive form of cancer that require tens of thousands, if not millions of dollars of treatment and the town is rural and not very wealthy? The answer under your idea would be bankruptcy of the town. Large-scale insurance is the answer, and preferentially that of a state-run non-profit agency which is only beholden to saving the taxpayers money when possible instead of reaping profits for investors at the expense of the insured.

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