JUSTICE AND

HEALTH CARE ALLOCATION

“Is Health Care a Good…A Right?”

“What Responsibility Does a Public Health

Professional Have in Ensuring Access to a Reasonable Level of

Health Care for Others?”

Distinction Between Social Goods and

Consumable Goods

An Inquiry Into The Nature and Cause of the Wealth of Nations

Adam Smith 1776

Argued that there are basic social goods upon which the “free market” for consumable goods is dependent, and that these should not be considered a part of the “market economy.”

• Is health care a social good? or• Is health care a consumable good?

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• Is or should health care be “in the marketplace”—a consumable good, or be basic to the market—a social good?

• Do illnesses of others affect us?• Does one’s health affect one’s ability

to have “equal opportunity?”

Arrow’s Arguments on Efficiency and the Market

(in the article of last week by Kopelman and Palumbo)

• Require that prices of goods be determined by competitive market forces.

• Consumers must have access to all relevant information about the quality of available items.

• Costs and benefits of purchased goods must accrue to their consumers.

• Arrow argues that the market for health care is unlikely to fulfill these conditions.

Kopelman and Palumbo’s Arguments

• Because actions or omissions of others affect our health status (contagion), society has compelling interest in keeping everyone healthy. Market forces are unable to do so. .

• Consumer’s are generally unable to determine the quality of the health care product, and therefore must commit themselves to the trust and advocacy of their health professional.

• Consumer’s cannot predict their needs for health care, therefore cannot be prudent purchasers in the market.

• They conclude that market forces do not work in health care. . .therefore a social good.

Health Care Expenditures• Currently we spend 13.7% of GDP on health care; over

twice other industrialized nations; $3,724/person/year.• This will be over $1.5 trillion in 2003.• Health care costs are expected to double by 2011 to

$2.8 trillion.• Health care costs have increased over 1,000% in the

past fifty years.• In 2002 public health care programs grew by 10.4%

versus the anticipated 7%.• Medicaid expenses increased 11.5% in 2001.• Yet, on many population health indicators e.g.,

premature births, infant death rates, immunization rates, etc. the U.S. ranks below other industrialized countries,

• One in six Americans lacks any basic health insurance coverage; currently 44 million people. Of these 25%, or 11 million are children. 22.4% of America’s children live in poverty, the second highest (after Mexico) of the industrialized countries of the world.

• Essentially all Americans over 65 have a decent, basic level of health care through Medicare.

• In the population served by Medicare, estimated that almost 30% of the funds spent by the 6% of enrollees that died that year.

Health Status In America

• According to a report issued in 2000 by the World Health Organization, the United States ranks 37th in the world in the quality of health care, while spending far more per capita than any other nation.

• The U.S., according to the report is very good at expensive, heroic care, but very poor at lost cost preventive care in which other countries excel.

• Clearly, if one individual has a need to be treated for a specific disease, the best treatment in the world is in the United States.

• But, on population-based statistics on the overall health of the citizenry, we rank 37th.

• The handout provides a ranking of 75 of the world’s countries.

Harris Poll

Ninety percent (90%) of Americans agree with the statement, “everyone should have the right to get the best possible health care--as good as the treatment a millionaire gets.”

In health care, what would constitute a ...

“decent, basic minimum?”

Daniel Callahan, a prominent bioethicist has defined a decent, basic minimum as “that level of care our society would cringe at the thought of someone not receiving.”

Tempering Human Value

• While we frequently attest that humans have infinite value, we only have finite resources to devote to caring for human health; our resources are not limitless.

• There are also other human goods to be provided for.

• On utilitarian moral grounds we must ask the difficult question of cost versus benefit/value.

• Limited resources require that we ask, and operationalize,what a “decent basic minimum” is and how much can be afford.

Oregon’s attempt to define a “decent basic minimum” in its program of health care for low income families (Medicaid); the Oregon Health Plan.

Exercise

Prioritizing Health Care(Rationing). . .

Using the Oregon Model

Kentucky Medicaid

• In 2001 Kentucky allocated $3.2 Billion dollars in public funds for health care of low income families. Medicaid serves families at 150% of the poverty level. (See distributed scale.)

• $650 Million is Kentucky tax dollars and $2.55 Billion was federal tax dollars.

• $11 Million was added to the dental budget July, 2000, in order to increase fees and encourage greater participation by dentists.

• Federal poverty level (100%) is $695/month or $8,350/year for one person; and is a reference point for calculating eligibility for most social welfare programs. (See handout for complete scale.)

• A considerable part of the Medicaid budget is spent on nursing home care for the elderly, many of whom “spend down” their resources in order to qualify for Medicaid.

• In contrast to popular opinion, much of the Medicaid budget is spent on “middle class” individuals living in nursing homes during their last years of life. Your family?

Children

• Medicare grants an entitlement right to a decent, basic minimum of health care to all Americans over 65, regardless of income.

• The only way to exclude yourself from the system is to die or return to 64!

• Whereas all of our children, our country’s future, and our most vulnerable population, does not have a guarantee to a decent, basic minimum of health care..

State Children’s Insurance Program:

S-CHIP

• A federally mandated and funded program (1996) to provide health care for low income children, who would not ordinarily qualify for Medicaid.

• In Kentucky is called K-CHIP.

• Covers all children in Kentucky whose families are at 200% of poverty level ($2,842 for a family of four--handout provides complete scale.)

• In Kentucky the program is integrated with Medicaid. K-CHIP families would receive a Medicaid card and dentists (and physicians) are reimbursed at Medicaid fees.