Friday, October 12, 2012

If air travel worked like health care

I spent the day at the Law School's "Future of Health Care Reform in the United States." I'll post my talk soon. In the meantime, Einer Elhauge from Harvard showed this hilarious video. Enjoy!


  1. If you want efficient homogenized health care be willing to sacrifice your personal relationships with your doctors. If you want medicine to run like Southwest Airlines be ready to be treated like cattle.

    Many group medical practices run like assembly lines now. You see whoever is available while you're there. Do not expect your doctor to know you like in the old days.

    Thus far the attempts to computerize medical records have converted doctors into the world's highest-paid data entry operators. The conversion to electronic health records usually drops productivity about 20% during the process, which takes months.

    I have noticed that my family doctor, who used to do a very thorough exam, now spends a fair amount of time clicking away at his computer and that time spent on the exam has dropped.

    As they say in engineering: "Speed, quality, price. Pick any two."

    1. American healthcare already treats you like cattle. There is close to zero personal attention or connection.

      It is cheaper to fly to a developed country, stay for a vacation and perform any necessary procedures there, compared to paying for the same procedures in the US. The US market is beyond reasonable.

  2. This is absolutely fabulous.

    I don't know how to do it, but we need to bring some sanity to the medical system.

  3. No provider has an incentive to share information. Bunch o' product differentiaters without entry, mini-monopolists. But that's just the tip o' the iceberg.

    In the US, there are still institutional barriers to increased supply of doctors. However, there are now fewer barriers to consolidation than in the past, and that's what's occurring--larger firms, with in-built quality and cost controls. Competing National Health Services are emerging. Just need to settle the insurance problem.

    Obamacare settles the insurance problem, but won't allow the necessary competition to serve as the discovery procedure.

    There, I feel much better.

  4. Awesome.

    In health care, they would never tell you how much it will be until you get the bill. Also, the travel insurance would only cover 80% of the $17,000, leaving you with a $4,000 bill.

  5. Businesses profit by serving their customers -- and in the U.S. health care system the customer is the third-party payer, not the patient.

    I'm glad there's no "airline insurance" as in the video.

  6. US healthcare system is much better than the system in many European countries, still it lacks many features. Government should amend rules to give better service to citizens.

  7. Just because the system is complicated, doesnt mean the problem is complicated. The problem is simply that we dont have a competitive market for health insurance. If insurers had to compete for your business, you'd choose the one that gives you the best deal overall. The carrier would be incentivized to tackle just about every problem we currently have with the system. If someone cant afford it, we cover their premium rather than create all kinds of rules. I dont buy the "health care is special because its essential" argument. Food, water, and shelter are all essential, but we have well functioning systems for those things.

  8. Please, please, please; nobody say "there oughta be a law." Please...

  9. Dear Prof. Cochrane,

    Wasn't this video made BEFORE Obamacare was even passed?

    Thank you,

    1. Yes. Are you saying you think Obamacare solved the whole problem?!

    2. Dear Prof. Cochrane,

      Sorry for my late response, previously I was not subscribed to the blog, and thank you for taking the time to reply!

      I thought wrongly that you were implying Obamacare was a part of that mess in the video.

      I know from experience that Americans have the best quality care if you manage to pay for it: My father could extend his life considerably by going there after being diagnosed with a rare, then terminal disease.

      But what a big mess there is in Healthcare: A lot of services and drugs that we could get locally, like MRIs, would cost up to 1000% more than in local hospitals. We were already paying premium for the special care we could not get locally, but we were caught off guard how simple things at the end actually end up costing relatively the same. My gut tells me if you are poor in the US and get sick from anything other than your average flu, your bill is going to be very prohibitive.

      Indeed, during my teens I suffered some injuries while visiting relatives in the US and received care worth hundreds of dollars for things I would barely pay for in my home country. In contrast, I once broke a rib in Japan, the bill for everything including emergency transportation(free), check up, bandages, and drugs was around $100.

      I know Obamacare has not solved many of these issues. But maybe incorrectly I perceive that not many politicians over there and over a looong period of time have put up a real alternative, specially one that tries to reduce costs. My solidarity goes out to all those uninsured Americans. If I were one of them I would be learning how to stitch my own wounds.

  10. The need to answer all the same question over and over, even if you're just there to get checked for strep or something, comes (I assume) from government regulation. Complaining that the information isn't centralized and shared and computerized misses the more obvious direction of improvement, that most of the time, they don't/shouldn't *need* 'your medical history' in the first place.

    The proliferation of 'specialists' and the need to schedule independent appointments with them (and to get 'referrals' to do so) probably comes from a similar source, either regulation or (more likely now that I think about it) from insurance-company mandates. Again, to couch the complaint in terms of saying why-can't-all-this-be-scheduled-once misses the actual reason for the needless 'legs' of the process.

    I am skeptical that taking these criticisms to heart would make for an improvement. After all, 'specialist referrals' and 'get all their medical histories', were probably only insisted upon as 'improvements' to earlier problems...

  11. I wonder what it would be like to extend this series: if Whole Foods worked like health care,

  12. Thanks for taking the time to discuss this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with more information? It is extremely helpful for me.what is diabetes

  13. Talk about specifics, like checking your luggage, going through security, and getting into your seat and putting on your seat-belt on the plane. It's sometimes hard for adults to imagine the kinds of things that kids will be worried about, for example: private jet charter


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