• “The Healthcare Mess” – Julius B., Richmond,
M.D., Rashi Fein, Ph.D., 2005
• “Healthy, Wealthy, and Wise: Five Steps to a
Better Health Care System,” Kogan, Hubbard,
• “Can We Say No? The Challenge of Rationing
Healthcare,” Henry J. Aaron
• “Business of Health,”by Robert Ohsfeldt,John E.
• Jesse Larner
Criticisms of SICKO… Note: criticism are in black and
responses to criticisms are in red…
• Sicko doesn’t say who • Moore does in fact
will “pay” and falsely mention that the
claims that British, French are “drowning in
French, Canadian taxes” … and that
healthcare is “free” single-payer healthcare
systems are paid for by
• BUT… Moore doesn’t
percentage of taxes are
used to pay for
Income Tax rates by Country based on Organisation for Economic Co-operation and Development, 2005 data (includes
employer payroll tax contributions that some countries impose for programs like social security and healthcare.
Criticisms of SICKO…Cheeseburger
• The U.S. cannot be compared to • the United States does not stand out
other industrialized countries in the quantity of care, as measured
– “We Eat More Cheeseburgers” by such indicators as the number of
argument – our unhealthy lifestyles physicians, nurses, and hospital beds
offset our superior care… per capita.
Source: Ezra Klein of The American Prospect
Source: Paul Krugman, The Healthcare Crisis – NY Review of
• Nor does the US stand out in terms of
the quality of care: a recent study
published in Health Affairs that
compared quality of care across
advanced countries found no US
advantage. On the contrary, "the
United States often stands out for
inefficient care and errors and is an
outlier on access/cost ba
Source: Gerard F. Anderson, Peter S. Hussey, Bianca K. Frogner,
and Hugh R. Waters, "Health Spending in the United
States and the Rest of the Industrialized World," Health
Affairs, Vol. 24, No. 4 (July/August 2005 ),
• Sicko misrepresents the Canadian
Medicare system: • Only 3% of Canadians suffer
– Canadians endure long waits, 4.5 months
Source: Gera ld Anderson, Johns Hopkins Health study
• Longer lines/waits are,
– Canadians endure waits of 4 to 12 hours overall, a justified “cost”
for basic care
Source: California Association of Health Plans/Op-ed… – Long lines are evidence of
– These long waits result in needless deaths Canada’s moral commitment
(ie – film regarding brain cancer patient…) to serving all…
– Increasing numbers of Canadian patients – 24% of Americans simply
and MDs are now coming to the U.S. for avoid healthcare due to $$$
treatment frustration (vs. 5% in Canada and 3% in
– My friend/relative (fill in here) lives in the U.K.)
Canada and hates their system… • According to a Gallup poll in
– http://www.freemarketcure.com/brainsur the Toronto Sun, only 2% of
gery.php Canadians stated a
preference for U.S. style
Criticisms of SICKO…
• OMISSION - Europe is starting to move away
from government healthcare:
– U.K. is now privatizing surgeries, etc.
– Sweden will outsource 80% of its primary care and
40% of its total healthcare dollars
– Germany has a universal but private insurance
Criticisms of SICKO…
• 12.5% in the U.K. wait • Ranking for non-elective
over a year for surgery… MD appoint wait-times
• Wait times for care are (% are for same day
longer elsewhere than appts)
in the U.S. … – 1. New Zealand
– 2. Britain – 71%
– 3. Germany – 69%
– 4. Australia – 66%
– 5. U.S. – 47%
– 6. Canada – 36%
Criticisms of SICKO…
• OMISSION - Our drugs and technology
are the best in the world due to
market-driven medical innovation
made possible by the Orphan Drug Act
of 1983. This act uses tax incentives
and 7 years of market exclusivity to
incentivize drug production…
• We in the U.S. benefit from new drugs
– we get “first launches” of drugs
which cost approx. $1 billion per drug.
Source: Manhattan Institute/Washington Post
Criticisms … Moore’s worldview is anti-American, socialist
and dangerous to the U.S.…
• Tony Benn is an old-school socialist…
• Moore wants “French freebies on the government dime”
• Moore prefers class-conflict to American individualism and personal
• If se have socialized care, our society will lose it dynamism
• Moore is “more French” than the French – even the French are
abandoning their socialist ideas with the election of Sarkozy…
• Liberals desire government programs because liberals want us to be
weak and dependent on the government…
• U.S. exceptionalism – we are the greatest country and thus have the
best healthcare system and thus Moore, by criticizing our system is
• French “protests” are protests by privileged middle class sectors of
society that seek to keep their cushy benefits yet exclude immigrants
from Africa, Turkey, and those from the former eastern bloc…
• Source: Rich Lowry, National Review
• Response – The argument that “SICKO shows that liberals are are
anti-American pinko’s/commies” is a strawman (the left does not
agree); it is ad hominem (instead of addressing the issues he
raises, conservatives such as “National Review magazine” simply
resort to red-baiting or name calling; and questionable premises
(ie – the French do not want to give up their socialized, single-
• In regards to the strawman fallacy, even “The Nation” – a well-
known leftist, U.S. magazine criticizes Moore’s ode to Marx:
• "The film's final half-hour, in which Moore takes 9/11 rescue workers to Cuba,
serves only to reinforce the decades-old slander that equates social democracy
with repressive socialism. It's a major miscalculation and nearly squanders the
first hour and a half of the film in which Moore so deftly guts arguments that
socialized medicine represents the vanguard of Marxism.“ Source: Christopher
Hayes, The Nation
• Should we ensure – whether via free market or socialized
care – provide everyone with healthcare?
– Basic care? Elective surgeries? Non-elective surgeries?
– Is rationing of care ever morally permissible?
– Are we obligated to provide healthcare to those who have
• Are all forms of insurance the same?
– Fire insurance
– Car insurance
– Medical insurance?
• Are healthcare products analogous to cellphones, etc?
– X-rays vs. automobiles, cars, cellphones…
• Socialized medicine version 1 – government pays but the
private sector delivers
• Socialized medicine version 2 – government pays and
government delivers (V.A.)
• Single-payer – government pays; one private sector insurance
• Free-market – consumer pays, health provider delivers
• 3rd party (84% of U.S. costs) vs. 1st party payment/delivery…
– taxes to 3rd party government
– premiums to 3rd party insurer
– Out of pocket payment at “point of delivery” to party healthcare
provider by consumer
– Criticism of 3rd party payment: MDs and patients don’t act rationally
in light of actual costs…
Brief History of Health Insurance in the U.S.
• WW II – due to labor shortage (and wage caps by
gov’t), employers offered health coverage to
employees in order to attract workers (a “work
around” to price controls on wages…)
• Health insurance was relatively inexpensive given low
medical costs, technology, drugs, etc.
• Health insurance is a non-taxed benefit offered by
employers which, if taxed like wages, would net $150
billion in additional tax revenues.
• Health insurance now costs employers, on average,
$10,000 to insure a family of four…
Causes for rising costs in U.S.
• Fragmentation of healthcare
– Medicare (single-payer system for seniors)
– Medicaid (single-payer for the poor)
– Healthcare delivery systems – private insurers, for-profit
– 50% of spending is by U.S. gov’t, 50% by private sector
• 1960 – 5.2% of GDP vs.2004 – 16% of GDP
• New technology, drugs, therapies are costly.
• MDs paid much more in the U.S. than elsewhere
• 30% of each private healthcare dollar spent on
administrative fees and profit
• Rise in MD insurance premiums (
• Malpractice jury awards increased 4 percent annually
between 1991 and 2003 or 52 percent overall since
1991, but only 1.6 percent a year since 2000.
• The increases are roughly equivalent to the overall rise
in healthcare cost
• Malpractice insurance premiums for internists, general
surgeons, and obstetricians have skyrocketed since
2000, jumping 20 to 25 percent in 2002 alone. Some
specialists, such as obstetricians, now pay almost
$100,000 annually for their malpractice insurance.
Source: Rising doctors' premiums not due to lawsuit awards; Study suggests insurers raise
rates to make up for investment declines; by Liz Kowalczyk, Globe Staff | June 1, 2005
• Malpractice insurance companies have increased
rates to compensate for falling investment
returns (1998-2000) due to bond losses which
make up 80% of their portfolio
• Malpractice insurance rates vary widely
– Dade County, Florida – increased 75% (to
$174,300) from 1999 to 2000 vs. 2%
(%10,140) for the same specialty in Minnesota.
– Minnesota’s largest insurer increased rates for
the same specialty by 2%
Source: The Health Care Mess – Julius Richmond, M.D., Rashi Fein, Ph.D.
Adverse Reaction Cycle –
the problem with
Advantages of Single-Payer
• It’s ethical – no “adverse selection” – all are covered.
• Removes competitive penalty on small businesses.
• Single-payer is more efficient
– Medicare’s administrative overhead is 2% of total costs vs.
13% of private insurance companies.
– Medicaid - $9,600 avg/person vs. $14,800 if in private
sector. Source: Medicaid: A Lower-Cost Approach to Serving a High-Cost Population," policy brief by the Kaiser
Commission on Medicaid and the Uninsured, March 2004.
– Taiwan – switched to universal, single-payer in 1995 with
better quality yet only slightly increased costs.
– Stronger drug-bargaining position (Medicaid & V.A. get
“Canadian rates” from U.S. pharmaceuticals…)
Free-market voucher approaches?
• South Carolina – a free- • Who decides on voucher costs?
market voucher system • Who provides (and pays for) the
• Consumer-directed • Is “healthcare consumption”
approach –eliminate “3rd analogous to “appliance
parties” – whether it be consumption”?
– How will patients “shop around
insurance companies or and compare” during emergency
government and instead let situations?
– How will information regarding
patients barter directly with healthcare quality be
physicians and hospitals communicated?
with vouchers. • Will vouchers address increasing
costs due to technology, drugs,
• Source: “Healthy, Wealthy, and Wise” – D.
Kessler, Hubbard etc?
Free-market tax-credit proposals…
• Remove tax advantage that • Do the wealthy need taxbreaks
favors health insurance over of this kind?
“out of pocket” by taxing • Will this reinforce adverse
selection? – those who are
some employer based healthy will adopt savings
health benefits OR cut taxes accounts and opt out of
on out-of-pocket. company insurance plans…
• Tax advantage health • Rand study: we don’t make
wise healthcare choices if out-
savings accounts – tax free
shelter for healthcare.
• This will not address expensive
treatment that is 80% of