Wednesday, August 25, 2010

Public healthcare is good, but...

technological advances in healthcare seem realistically to only improve medical effectiveness while not reducing its costs.  A sad but inescapable truth about healthcare spending and longevity is that it guarantees further healthcare spending.  If medical treatment prolongs life, then additional different end of life treatment will be necessary in the future.   Deathcare expenses are innescapable. this link states the issue in a polite manner.  Public healthcare faces a difficult obstacle in not wanting to refuse care, not wanting to raise taxes (pay for it), and declining birth rates impose a substantial burden on those most likely to pay the taxes necessary to pay for deathcare.

There is a possible fair and socially distributed solution though:

First, we can predict the costs of deathcare per individual.  Not that I have an educated estimate, but say it is on average $20K per person regardless of cause of death.  If each person paid that much into a government invested savings account such that it grew to $20K by the time they hit age 85, then each person would cover their own deathcare.  Having high income people pay $25-30K, and low income people a smaller $15-10K is perhaps democratically preferable, but an insignificant detail.  $100/year (tax payment) from age 20 to 85 grows to over $30K at just 4% rate of return.  In socialized healthcare, the actual costs of deathcare would still be paid socially.  Individuals simply fund the expected costs.

If funding deathcare becomes politically palatable, then individuals could also choose to optionally insure for specific expensive and experimental treatments.  For example, you could choose to fund possible needed future cancer treatment, or choose to avoid cancer causing behaviours and not insure.   The cost of cancer treatment times the likelyhood of contracting cancer might be $8000 per person.  An alternative, that is unfortunately susceptible to horrifically evil medical corruption, would be to pay tax supplements for each month you survive cancer treatment in order to reflect the death avoiding healthcare you received and be proportional to the quality of benefits you received.

Without these direct, but still socially distributed, funding opportunities, managing healthcare costs will mean reduced healthcare (death panels) or higher general taxation.  The funding proposals would encourage life extending medical research.  Its a clear human benefit to enjoy life extending technology.  We just need to pay for it if we want it.  The high public debt in Ontario justifies these extra funding streams.

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