The Top Ten Myths of American Health Care

Book Review by Bob Hall

The Top Ten Myths of American Health Care
A Citizen’s Guide by Sally C. Pipes
(c) 2008 Pacific Research Institute

I read this 150-page, well-documents and surprising book on a recent flight. I found it both a quick, easy read, and quite interesting, as it challenges much of the conventional wisdom spouted by all sides in the health care reform debate.

Those looking for only a Republican viewpoint will be disappointed. Pipes skewers John McCain, George Bush, Mitt Romney and Arnold Schwarzenegger for their uninformed posturing on health care issues as often as she does Barack Obama or Hillary Clinton. Though the book was written before the election, as the Health Care Reform debate heats up, it’s still very timely.

Both Obama and McCain repeated the claim that 46 million Americans can’t get health insurance. Pipes points out:

This figure comes from a Census Bureau survey, which admits insurance coverage is under-reported, and says that “under-reporting of health insurance coverage…appears to be a larger problem (in the CPS) than in other national surveys.”

The survey estimates the number uninsured at a point in time, not for the whole year.

18 million of the uninsured make over $50,000 a year, but are young and healthy (the Invincibles!) and choose to spend their money on other things than insurance.

10 million of the uninsured are not citizens. Do American taxpayers owe insurance to non-citizens living here?

14 million are eligible for programs like Medicaid and SCHIP, but aren’t enrolled. In other words, some form of insurance is available to them, they just don’t sign up. This includes 5 million of the 8 million uninsured kids, who are eligible for SCHIP.

So there is a problem with insurance coverage, but not nearly the problem stated by politicians on both sides of the aisle.

She also takes on the claim that high drug prices drive up health care costs. America is the leader in pharm research, because, while it costs $1.3 billion to bring a new drug to market, the number of new drugs cuts down on problems that would have required surgery or hospitalization. Statins, for example, have cut down greatly on heart surgery and the costs of heart attacks.

Why are drugs cheaper in other countries? The governments there have price controls and force our companies to sell low. If they don’t, the threat is they will allow their drug companies to steal our companies’ patents, and sell the drugs themselves, perhaps back to Americans through import schemes. But the low prices don’t cover the research costs on the large % of drugs that don’t make it to market, so again, American consumers are covering R&D for the world. If we end up with price controls in America, so that investors lose money investing in drugs, and R&D goes downhill, how many tens of thousands world wide will die annually who might have been saved by drugs never developed?

Think government prevention programs reduce health care costs? Think again. Pipes points out that a non-smoker who dies at 85 uses about $100,000 more in health care dollars than a smoker who dies at 77. So prevention is a good thing for people—but it doesn’t save money over all. (Besides, The Obama Administration is using the increased smoking tax to fund SCHIP—if we get people to stop smoking, how will we pay for kids’ insurance?)

One of the myths Pipes destroys is that government-run health care systems in other countries are better and cheaper than America’s.

Pipes points out that Canada ranks 24th of 28 countries in doctors per 1,000 people. When the Canadian Government took over health care in 1970, Canada ranked second.

It is often claimed that citizens of countries with government run health care have better outcomes. They claim that citizens of 30 other countries have longer life expectancies. But Pipes points out that the difference is due almost entirely to homicides and car accidents, and that Americans who don’t die of these two causes outlive citizens of other western countries. It’s hard to see how government run health care will lower the murder or accident rates.

And the infant mortality rate could be vastly improved if we stop counting premature births as live births. We keep these babies alive—other countries don’t but don’t include them in their touted counts.

America leads the world in cancer treatment. Women with breast cancer in the US have an 83.9% 5-year survival rate. For British women, it’s 69.7%. In fact, Americans have a better survival rate for 13 of 16 common cancers. American men have a 20% better chance of living for five years after a cancer diagnosis than European men, American women a 7.2% better chance.

Because our system spends more of our GDP than other countries, we put more into medical research and development. America produces more than half of the $175 billion of health care technology products purchased worldwide annually.

In 2004, the US Government spent $18.4 billion on medical research. The European Union, with a larger population than the US, spent $3.7 billion. So as with drug development, much of the high % of GDP spent in the United States goes into research that helps the whole world. Europeans are living off the US taxpayer in health care, as in so many things.

When Italian Prime Minister Silvio Berlusconi needed heart surgery in 2006, he came to the US, passing up the wonderful “free” care available in Europe. Why would he do that, if they have such better care?

I highly recommend this book to anyone interested in the health care debate. Yes, there are problems in America’s health care system. But if we are ignorant of the facts—and most voters are—we are likely to make the system worse, because the politicians of both parties will do what is in their short-term interests with these ignorant voters.. And there will be no going back.