Friday, May 01, 2009

Soviet Healthcare History

Assistant Village Idiot reveals the late Alexanr Solzhenitsyn's position on universal government-funded provision of pharmaceuticals:
[T]ake actual drugs and medicine, for instance. In the twenties all medicines were free. Do you remember?"

"Is that right? Yes, I think they were. One forgets."

"You'd really forgotten had you? They were all free of charge, but we had to give it up. Do you know why?"

"I suppose it must have been too expensive for the government," said Dontsova with an effort, closing her eyes for a short while.

"It wasn't only that, it was also that it was extremely wasteful. The patient was bound to grab all the drugs he could since they cost him nothing and as a result he threw half of them away.
The quote is from Solzhenitsyn's 1968 novel Cancer Ward. As AVI notes, the passage goes on to praise a scheme where "the patient pays for primary care and medicines, but hospital and specialist services are paid for by the government."

That approach would "socialize" less--and less is better than more. But a system limiting coverage to primary care still would suffer the same flaw--the absence of cost-control. Simply put, free goods (or services) will be over-used. Ask the French, which has a mostly-socialized system. The result?: they prescribe more drugs and, as I previously quoted:
There is no incentive not to indulge the slightest twinge. The French go to the doctor more than twice as often as the Swedes.
The U.S. system suffers from parallel weakness, caused by one-size-fits-all insurance offered through employers, rather than relying on private insurance competing at the consumer level (and some other problems). Ideally, health insurance should be more like automobile insurance in one respect--the availability of an array of options priced, in large part, based on the amount of the non-deductible threshold claims must exceed to trigger reimbursement. And set the system to pay for performance.

Killing any "co-pay" invariably undermines cost-control. In the Soviet Union or America.

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