Everybody that is not focused on President Trumps Twitter ramblings is talking about healthcare: the skyrocketing premiums, who is getting the shaft by repeal of Obamacare, is anybody doing anything about the cost of prescription drugs, and on it goes. Who knew healthcare could be so complicated?
One thing is absolutely certain, given the chance, everyone would love to have totally free healthcare that would enable each person to live a healthy, pain free existence. Then on the day of their choosing, the lights get turned out; in other words, death.
This description of a utopian existence is what the American system has been promoting since the war on cancer began more than 50 years ago. No one has yet discovered the cure for cancer, just treatments that lower death rates. There is even a new cancer treatment that avoids chemotherapy. Beautifully executed video commercials offer cancer suffers the opportunity to extend your life. In exchange for a few thousand dollars a month you get to celebrate one last 4th of July. Science is not curing illness, just momentarily delaying the last curtain call.
The name of this drug has intentionally been left out because there is more than enough drug advertising in the world already.
Charlie Munger States the Case
Warren Buffett’s long time sidekick at Berkshire Hathaway recently participated in an extended interview following the company’s annual meeting. Other distinguished participants included Warren and former Microsoft Chairman Bill Gates. These guys know how to cut through the froth and zero in on reality.
According to data sighted by Warren Buffett, it is healthcare, not taxes that is America’s far bigger problem. Compared with 50+ years ago, income taxes take a far smaller share of the economy (about 5%) whereas healthcare is almost three times this level at 14% of Gross Domestic Product. Every year healthcare eats up a larger share; it is now bigger than national defense.
Munger, who happens to be Chairman of Good Samaritan Hospital in Los Angeles has some well-founded opinions on healthcare. He is a big advocate of a single payer system. Unfortunately, the US is one of the only countries in the world that attempts to maximize health benefits while minimizing costs and still allow healthcare providers to reap massive profits. Sound crazy: it is.
Another thing Munger mentions without going into much detail was his reference to over treatment of the dying. There is real truth the notion that America is dying beyond it means. Consider the following.
The Healthcare 1 Percenters
A study published in 2012 by the US Department of Health and Human Services more thoroughly explains Munger’s position. Roundly, 1% of the US population consumes 20% of healthcare expenditures. Just 5% consume 50% and 10% eat up about two thirds.
Surprise, surprise, much of the top 5% consist of the elderly; those above the age of 75. The medical profession is creating nothing more than a series of human museums euphemistically called Senior Living Centers. Is it the responsibility of society to set a Guinness Book of World Records for the most people living beyond 110 years old?
From the patient’s point of view, why shouldn’t they have choices? It may be a grisly thought to many but why should people have the right to have a say in their final days? The pharmaceutical industry would be hurt by less demand for drugs that would extend life by a few days or weeks but it could change the direction of the healthcare discussion.
A few states like Oregon are pioneering in the effort and Canada has adopted an even more comprehensive policy nationwide. There is nothing more sensitive than the subject life’s end. On the other hand, there are few things more costly. As the boomer generation takes up an ever-larger share of the healthcare budget, the question is likely to take center stage in the healthcare discussion.