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Will Health Care Bankrupt The Country?

That is the dire prediction of Dr. Atul Gawande, a noted writer and surgeon who practices at Boston’s Brigham and Women’s Hospital and who calls one of the most powerful and influential people in the medical community.  This is the story he told at a recent speech as reported by the Boston Globe‘s Chelsea Conaboy on White Coat Notes at

My son was having trouble in school. He was doing fine but he had drifted down in his grades, and it just wasn’t getting noticed. He was in a class of 30 students to one teacher in the Newton public schools which is a well-funded district. And I went to the parent teacher conference with my wife to try to understand what we might be able to do to help with the situation.

I ran into the new school superintendent, who had been hired to be a school reformer and help make the quality of our schools better. And I said to him, “What are you doing to work on this problem? We have 30 students in my son’s classroom. What are you working on these days?”

And he said, “You know what I’m working on? You know what I spend more time on than anything else? Health care costs.”

He said, “Our tax revenues have been flat. The school enrollment is up, and this year’s teacher health care premiums went up 9 percent.”

I said, “Oh.” And I went off to the parent-teacher conference. (laughter)

And on the way, I ran into a teacher that I had operated on. She’d had a lymphoma, and we’d been able to save her. But I realized she was one of that small percentage that accounted for more than half of their health care costs. And that’s when I realized, I had doomed my son’s education.

Now, I do not believe that the choices are between whether my son gets a great education or his teacher gets great care for her lymphoma. I believe that it’s possible to have great care for her lymphoma and a great education for him.

There’s nobody in Washington, that can calculate and devise a way to make that possible. Only people in health care can do that. Only the people here.

America’s great systems are in crisis today: health care, government, education and law.  All of them are more expensive than they should be, none of them work particularly well (though there are pockets of real excellence everywhere), and whether we like it or not the United States will need more and better service from each of them as the 21st century rolls on.

Nothing could be more urgent than our need to re-invent these basic institutions and systems that underpin modern life, and as Dr. Gawande’s example so dramatically shows, the systems are interrelated.  Getting this right is going to take time, and is going to involve some painful adjustments for a lot of people.  But there is no alternative — and the good news is that hard as it is for the United States to make these changes, we are better placed to begin than any of the world’s major countries.  And the country that figures out and implements new and better ways of getting these vital services done will be the world’s economic leader in the decades to come.

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  • Glen

    It’s irrelevant that every health care or education worker isn’t directly on the government payroll. Through a complex web of tax policy, industry regulations, private sector mandates and intergovernmental transfers, virtually every aspect of education and health care in America is controlled by government. And that’s why both aren’t “working.”

  • Ustad Pedro

    The problem it seems to me is that the central issue: The oligopoly of med schools/hospitals, doctors, insurance companies, and pharma. In classical economic terms, it is this cabal that is sucking up “consumer surplus.” The left’s approach of “covering” higher costs through insurance and the right’s approach of “patient choice” are both nice ideologies for their bases but practically useless and powerless to destroy the cabal that is sucking US consumers dry. This is all Econ 101. Is there no one is DC or the state capitals who gets this? Or are they all bought out by the cabal, left, right and center?? Perhaps there’s some creative application of antitrust laws that can be brought to bear? What’s needed is a mechanism to limit the cabal’s ability to exercise their collective market power. Until then they are not going to let any reform, competition or cost-reduction come in their way. A simple sniff test: Ever find an unemployed doctor? or even a poor one? Which other profession can claim that? Market performance is an indicator of industry structure.

  • Anthony

    “Getting this right is going to take time, and is going to involve some painful adjustments for a lot of people.” WRM, the interrelated systems you identify compose three of the professional guilds that are generally ignoring obsolescence of blue social model. To begin figuring out new social arrangements requires analysis sans ideological predilections generally – better way to social/economic remedies.

  • Cory

    The only solution is adding more freedom of choice in these systems.

    The computer industry has been the most genuinely free market industry for the past fifty years. In 1960 a computer cost millions of dollars and took an entire building to house.

    Today even the poorest among us carry little handheld computers that have more computing power than the Apollo computer, and we have the knowledge of the whole planet at our finger tips, all for a couple hundred dollars.

    If we had genuine free market health care, we would all be walking into the clinic at Walmart and plopping down our twenty bucks to get a cat scan.

    If we had genuine free market education, our high schools would be turning out the brightest, best educated kids on the planet. We would have specialty schools for every type of learning personality, and academic interest.

    Everywhere “free to choose” is the operating principle, we see innovation and creativity.

    Everywhere “forced to choose” or “not allowed to choose” is the operating principle, we see stagnation and collapse.

  • dearieme

    “America’s great systems are in crisis today: health care, government, education and law.” Great? When was that?

  • Jacksonian Libertarian

    It’s the feedback of competition in the free enterprise system the forces improvements in Quality, Service, and Price. The Health care system is dominated by insurance paid for by a third party, so there is no incentive for the Patient to shop for lower prices, better quality, better service, or even to make sure that it’s a needed procedure. How much health care is unnecessary? 50%?
    As an example lets look at what has happened to Lasik surgery which insurance doesn’t cover. Starting from radial kerototomy surgery, the technology has improved to lasers, quality has improved, service has improved, and prices have dropped. Now imagine that happening all over the entire medical industry.

  • Mrs. Davis

    1963, 1923, 1953, 1933

  • lhf

    Why should insurance pay for routine or preventive care? It should be limited to the unlikely event as is all other insurance. If we went back to paying for our own basic health care, as used to be the case, consumers would be forced to “ration” themselves. It would also force individuals to maintain their own health. Why is noone proposing this?

  • Paul

    LHF, the reason why no one, and most particularly Mr. Mead, proposes truly private health care, or education, or charity, or care for the aged, is that these challenge the fundamental assumptions that we in the West have made since the late nineteenth century about what the state is for, what it can do and ought to do, and the manner in which it ought to do so. (In fairness, the reasons that these assumptions were made go back through the Schools to Aristotle and his teacher; they are part of our inheritance.) This is why Republicans, and Mr. Mead no less, might rail against the follies of the “Blue Social Model,” but in the end, propose nothing more than that it be tinkered with, or that it be recast to function more effectively in new conditions. Someone who rails against this model, while still tacitly assuming that the government should provide or ensure the provision of charity, education for the youth, medicine, and detailed procedural rules for the conduct of small-scale commercial activity, may be quite serious, but nonetheless completely incapable of serious effect. Reform must be radical in the true sense — going to the roots, philosophical and cultural even more than institutional. Only collapse prompts this kind of reform, so to hear the proposals for which you listen in vain, you will have to wait until you are burning 5000$ bills for warmth, and much else has come to pass besides.

  • wally

    We have a medical school/doctor shortage. We need to quadruple the number of med schools and the number of MD’s graduating each year. The practice of medicine is still a guild system, concerned with “oversupply” and “too much” competition. This unethical behavior is literally killing Americans.

    Medical schools and colleges should act like businesses and expand enrollment to meet demand. Why do they turn away so much business? So many qualified applicants? Why don’t popular medical schools build campuses all over the country like a regular business? Ivy league medical schools turn away more than 90% of applicants. Growth, increasing supply, increasing competition, will lower costs.

  • Richard F. Miller


    You offer a false choice: Blue Model or no Blue Model.

    In fact, what is likely to evolve is some form of reduced Blue Model. The slow motion crash of world economies will hasten what you might call the choice challenge. Take Social Security. We are likely to work longer before qualifying for benefits; some might have to pay more for benefits, and some might pay and receive less (means testing.) Or, perhaps the system goes private, or public/private.

    The point is, we are in an age of limits but not necessarily elimination.

    Owning a home remains a great idea, but not for everyone. So is going to college–but not for everyone. State and local tax abatements and federal subsidies for developers to build urban sports complexes will be only a memory. With a 100,000 sheet ream of paper, you probably can complete this list.

    The Blue Model is likely to chug on in some respects–but not all respects. It is the “new job” of politics not to offer election-eve false choices (here, depending on your politics, think either Mediscare or Socialist Takeover) but to pose the real choices that will be required by the de-leveraging project: who gets what and when.

  • Jim.

    Something I keep pondering:

    What’s wrong with the expansion of the medical sector, if those are goods and services that are in demand? Don’t we have an unemployment problem in this country? Aren’t market signals telling us to expand?

    Seriously, what are the chances that you *won’t* come down with an illness / injury / disease that the American medical system can miraculously cure, given a few million dollars per sufferer? The chances are not that high.

    It would be a better service than pouring an outrageous proportion of our GDP into the Financial sector, which doesn’t perform significantly better services for most Americans than it did 20 years ago when it took a much smaller chunk out of the economy.

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