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When it Comes to Health Care the NYT Is Protectionist
Just yesterday the NYT editorial board was complaining about the threat of protectionism in discussing Senator Obama and Clinton's trade policies. Today, the editorial board discusses Medicare's financial problems and never once mentions the extent to which this is caused by protectionism.
The basic point is very simple. Every other wealthy country provides high quality health care at a far lower price than in the United States. If we want to lower cost then an obvious way would be to try to take advantage of these lower cost systems. It is easy to develop mechanisms that would allow for Medicare beneficiaries to take advantage of lower cost systems.
The argument for the gains from trade in medical services is exactly the same as the argument for gains from trade in cars and clothes (we can even use the same graph, we just have to relabel the axis), except the benefits are likely to be much larger in the case of medical care. It is inconsistent for the NYT to be so committed to eliminating trade barriers in manufactured goods but willing to tolerate much costly barriers to trade in medical services.
--Dean Baker
COMMENTS (5)
You are nuts if you think I am going to start all over.
Posted by: Anonymous | February 26, 2008 4:10 AM
The two main culprits in high cost of health care are physician fees and drug costs. Cost of health insurance is directly related to these two factors. If you want global health insurance then it must become affordable. To do this you must control doctors' fees and drug prices. Competition would certainly help.
Posted by: Kaplan | February 26, 2008 12:11 PM
According to a Feb 22 Reurters article: Rich countries are poaching so many African health workers that the practice should be viewed as a crime, a team of international disease experts say in the British medical journal The Lancet. More than 13,000 doctors trained in sub-Saharan Africa are now practicing in Britain, the United States, Canada and Australia, leaving behind colleagues with impossible caseloads. African nurses and pharmacists are also sought after by clinics and drug store chains offering better pay and legal assistance with immigration, said the experts, who include the heads of several pharmacy and medicine schools in Africa. “The resulting dilapidation of health infrastructure contributes to a measurable and foreseeable public health crisis,” the article said. “The practice should therefore be viewed as an international crime.”
If we get rid of the barriers to bringing in foreign doctors and other health professionals who are willing to work for less, our costs will not reflect the cost to the country that supplied the training and the cost to the population of the country in terms of worse healthcare.
If economic efficiency requires that we internalize these externalities, how are we to do that? How are we to be made better off without making the country left behind worse off?
It seems that increasing the number of doctors and health professionals in the US might best be accomplished by increasing the number of seats in medical and nursing schools.
Posted by: Brummel | February 26, 2008 12:36 PM
Could we do what Cuba has done and make educating medical personnel a priority? If medical school was free, and the number and size of medical schools increased, that ought to decrease the monetary value of an MD. We'd have cheaper medical care without raiding other countries, and we could even export medical care, as Cuba does.
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