from The New Yorker, a review on the book America’s Bitter Pill by Steven Brill. The review is by Malcolm Gladwell.

excerpt:

It is useful to read “America’s Bitter Pill” alongside David Goldhill’s “Catastrophic Care.” Goldhill covers much of the same ground. But for him the philosophical question—is health care different, or is it ultimately like any other resource?—is central. The Medicare program, for example, has a spectacularly high loss ratio: it pays out something like ninety-seven cents in benefits for every dollar it takes in. For Brill, that’s evidence of how well it works. He thinks Medicare is the most functional part of the health-care system. Goldhill is more skeptical. Perhaps the reason Medicare’s loss ratio is so high, he says, is that Medicare never says no to anything. The program’s annual spending has risen, in the past forty years, from eight billion to five hundred and eighty-five billion dollars. Maybe it ought to spend more money on administration so that it can promote competition among its suppliers and make disciplined decisions about what is and isn’t worth covering. Goldhill writes:

Medicare is cheaper to run than private insurance. So what? Cheaper doesn’t mean more efficient. It may be cheaper to run banks without security guards, hotels without housekeepers, and manufacturers without accountants, but that wouldn’t make those businesses more efficient.

Tag Archives

Cheaper Does not Mean more efficient

Recent Posts

Recent Comments