March 26, 2017 - Freedomain Radio - Stefan Molyneux
01:00:47
3629 How To Save Health Care: A Memo to Donald Trump
With the failure of Republicans to pass the Ryancare legislation as the alternative to Obamacare, the critical state of the United States health care industry is once again in the headlines. What can be done to fix the failing healthcare system in the United States of America? Some of the solutions – and problems may surprise you!Stefan Molyneux discussed the importance of price transparency, lifestyle related health issues, the problems with single payer healthcare, the ability to refuse treatment, the perverted nature of insurance, the “friendly societies” of the past, how medical organizations reduce the supply of doctors to artificially raise prices, defensive medicine, the importance of tort reform, prescription drug challenges, specialization, end of life healthcare service, expensive not-for-profits and much more!The Truth About Obamacarehttps://www.youtube.com/watch?v=E9r93OxpE8gSources: http://www.fdrurl.com/how-to-save-health-careFreedomain Radio is 100% funded by viewers like you. Please support the show by signing up for a monthly subscription or making a one time donation at: http://www.freedomainradio.com/donate
Hi everybody, it's Stefan Molyneux from Freedomain Radio.
In this case, I really, really hope you're doing well because healthcare, accessibility, insurance, and the price of healthcare provision is back in the news in America since, of course, the recent failure of Ryancare, which was an attempt to modify because the Republicans don't have the vote to repeal Obamacare.
All they can do is modify it and that failed.
Now, Questions about the cost of healthcare all across the world, whether you've socialized medicine or the remnants of the free market, as in the States, are very easy to resolve.
If you just have a small bit of knowledge about the free market, you can resolve all of the questions and problems and issues you have about accessibility and the price of healthcare.
So we can run through those at a relative sprint today, just so you know what the actual problem is.
We'll put the sources to all of this, of course, in the show notes below.
So...
A couple of principles up front.
Number one, you can't possibly have a system or get a system where everyone gets all the health care that they want.
It's absolutely, completely and totally impossible.
This is one of these situations where an excess of supply drives additional demand.
So even if you had a doctor living in your house, available...
Twelve hours a day, well, it would not be enough.
You'd need a specialist or he'd be asleep or you won't ever get all the health care that you feel you deserve or that you want.
There's no possible way.
All human desires are infinite.
All resources are finite.
So this is really important to understand.
You can't get any kind of system, freedom, coercive, socialized, private, doesn't matter.
There's no system where everyone can get all the health care that they want.
Put that out of your mind.
Utopianism is a disaster when it comes to planning rational systems or allowing rational freedoms to overtake central planning.
That's number one.
Number two...
There are healthcare issues that are substantially under your control.
So these are estimates, so we'll put the sources below.
Up to 70% of healthcare issues, of health issues, of medical issues, are lifestyle-related, which is a nice way of saying you did it to yourself.
You know, smoking, drinking, lack of exercise, obesity, excessive exposure to the sun, which for me is about, I don't know, 12 and a half minutes.
It's just an Irish thing.
What can I tell you?
We're potato-based vampires.
But...
So, up to 70% of health issues are lifestyle-related.
Up to 9 out of 10 cancers are caused by lifestyle.
Again, smoking, sun exposure, bad food, and so on.
Some of it is air pollution and so on, which is somewhat related to social lifestyle or where you choose to live.
So, you can do a lot to control healthcare costs by not getting sick, and a lot of that has to do with your lifestyle choices.
Just wanted to point that out as a generic reminder for everyone.
You can't compare what is to any kind of utopia, right?
So when you talk about a free market healthcare system, which I'm going to clearly make the case for today, people can say, well, under a certain situation, somebody might not get healthcare.
Yes.
Yes, that's true.
Under certain situations, people won't get healthcare.
No question of that.
That's going to happen in any system.
Because again, not everyone is going to be able to get all the healthcare that they want, no matter what.
Right?
So if you propose free market solutions and people will say, well, in your system, what happens if?
And then they cough up like some socialist hairball.
Some random scenario wherein it's conceivable that somebody might not be able to get healthcare and then in their minds they can pair it to some perfect utopian fantasy world where everyone gets all the healthcare that they could possibly want and that's called the government.
It's not the case.
It has to be rationed somehow.
It may be rationed by price.
It may be rationed by supply.
It seems hard to ration it by demand.
Or, if you're in a socialist healthcare system, it's rationed by time.
You have to wait and wait and wait and wait.
And this was my issue in Canada, that I had this lump in my neck.
And I just had to wait and wait, and finally I just went to the States to get it dealt with.
And there's a lot in that.
I'll touch on this here and there, because it's almost like the universe made me sick to prove free market principles, but...
And this is the case in Canada, right?
So Canada inherited a very good healthcare system with hard-working free market doctors.
And when you socialize something, it's really good at the beginning because all of the discipline of the free market remains in the people who work there.
And it's all coordinated according to free market principles and efficiencies.
And then what happens is the work ethic decays over time.
Supply and demand get out of focus over time and things get...
Worse and worse, like the beginning of NASA, they got to the moon, and since then they did the space shuttle and very little else, right?
So at the very beginning, you inherit all the discipline of the free market and all of the seeming economic benefits of government funding, but it goes out of focus over time.
So in Canada, across 12 major medical specialties, the estimated typical wait time rose from 9.3 weeks in 1993 to 18.2 weeks in 2013.
And...
That makes no sense, right?
I mean, if medicine is getting more efficient, people talk about, oh, the technology is driving up the cost, which is complete and total nonsense.
And we'll get to that in a few minutes.
But yeah, health education is out there.
People should be getting healthier.
Smoking is down.
Drinking is down in a lot of places.
So why on earth is this wait time increasing?
Well, that's what happens is you're going to be restricted somehow.
It's either going to be my money or charity or time or supply or whatever it is.
Now, Another thing that's important to understand, just as a general principle, having coverage for healthcare is not the same as having actual access to healthcare, right?
Having actual access to healthcare is sitting in a doctor's office and talking about things, getting access to scanning devices, you know, MRIs, CAT scans, it's getting access to surgeons, it's all these kinds of things.
Just having it on paper is not the same as having it in reality, and that's a very, very important distinction.
There's no magic wand that can just have you get access to healthcare no matter what.
So, you know, Obamacare is like, oh, let's go and force people to buy insurance.
And we've got a whole presentation on Obamacare, which we'll link to below.
But dumping more people into the healthcare market doesn't magically increase the number of doctors or MRI machines or nurses or receptionists, for that matter.
So the fact that you have access on paper doesn't mean you actually get access in fact.
So, let me make a bit of a radical case that for those of us who are, well, I guess born in the last hundred years, seems kind of confusing, but it's a very factual and simple case.
Healthcare...
It's not actually very expensive.
That's an important thing to understand.
And there are a couple of principles that need to operate in order for the price of health care to come down.
And they all involve less government and fewer restrictions on supply.
This is the really, really important thing.
If you restrict supply...
Then tweaking with price and tweaking with all of this stuff downstream doesn't really matter.
So you have to look at supply as the initial cause of high prices in a static demand situation.
People want healthcare, and if its supply is diminished, then the price of healthcare will go up.
So we'll start with some of the less important things and then end up with a big bang, which apparently a lot of the internet videos are dedicated to.
So...
Price transparency.
That's pretty important.
So you need honest price transparency so that you can shop around.
If you don't have any price transparency, it's really hard to compete to shop around and so on.
And when insurance companies pay for more and more and more, then people care less and less and less about the price of things, right?
You've got your deductible.
You've got your co-pay.
After that, you don't really care.
You're not going to haggle.
You're not going to shop around.
Because it's the insurance company's job.
That's kind of part of what you're paying them to do.
So price transparency is a big issue.
And what you need to do is compare general healthcare to areas where at least remnants of the free market are still operating more decisively.
Two areas, of course, plastic surgery and LASIK eye care, you know, those lasers that remove the need for glasses in some people.
So those are two examples of healthcare where procedures have become cheaper, very short waiting periods and so on.
And in Canada, you can get an MRI for your dog.
The same day or the next day, but you might have to wait weeks or months to get it for a human being because priorities.
So this is really, really important to understand.
And where there's no price transparency, where people aren't haggling directly because the insurance company is paying, prices are going to tend to increase.
So here's an example from Washington, D.C. So one hospital.
Charges...
Sorry, these numbers are mad.
Charges $115,000 for putting a patient on a ventilator, while another hospital charged $53,000 for the same service.
And almost twice as many Americans are willing to shop around and compare prices and features for dishwashers than they are with doctors.
So that's...
That's kind of important.
And finding the quality of your doctors is really tough.
When you have a socialized healthcare system, then it becomes very hard to find out how good different doctors are.
I mean, there's sort of web rating stuff, but if you have some ailment, you want to go to the doctor who has the best track record of doctors.
Treating that ailment.
But you can't get this kind of information.
You can get mileage for your car.
You can get electricity consumption for your dishwasher.
But you can't get proven success rates for treating various ailments from the particular different doctors.
Because then people will flow more towards the doctor.
There'll be longer waiting periods.
And it will show significant weaknesses in the system.
So a lot of information is not collected or promulgated in socialized health care And that's really critical because it doesn't reward the better doctors and, quote, punish the worst doctors, giving them the incentive to improve and so on.
So this is very, very important stuff.
So another thing that drives up healthcare is that hospitals are not allowed to turn away people or refuse treatment.
Now, that's a big issue.
Now, I'm just going to say this once because I hope everyone understands I'm a big-hearted guy who wants the best for everyone in society.
So I'm not suggesting that, you know, you get bitten by some savage beast and you stagger up to some hospital and then they should slam that sliding glass door in your face and watch you bleed out.
I mean, you understand, I'm not talking about anything like that.
But if it's not a serious issue, if you don't have any means to pay, if you don't have any insurance, at some point you need to limit that.
Of course, right?
Of course.
So, because hospitals in the States can't turn people away or refuse treatment, that leads to some significant abuse.
And, you know, talk to hospital workers, as I have, and get the stories and find out the information.
You know, oh, does a kid have the sniffles?
Well, just phone up for an ambulance to take that kid to the emergency room.
And, you know, because he can't be refused treatment, he won't be refused treatment because it's against the law.
So, now, hospitals in general, they're not going to refuse treatment to somebody who's in legitimate need.
I mean, that would be terrible public relations, but, you know, this law really does create some significant problems.
Now, if you combine this law, in particular, with the tens of millions of illegal immigrants...
In America, for whom the emergency ward or the emergency room may be their primary form of healthcare, which is ridiculously expensive, like it's the most crazy expensive way to give people healthcare, is to have them stroll into emergency rather than have a sort of regular doctor and so on.
It's crazy expensive, crazy delays, and you know, people literally die in waiting as they do in Canada and other places.
So when you have people flowing across the border who can't afford healthcare, and this is really, really important.
If you're making $10 an hour, given how expensive healthcare has become in the States, you're going to be paying all of, if you've got a family, all of your money goes to...
Insurance payments for healthcare doesn't even cover your deductible.
So one of the things that drove Obamacare was illegal immigration and the cost of delivering services at the emergency room level.
So it's very, very expensive to do it that way.
And it's not hard to figure out.
Just imagine.
Imagine there's a restaurant.
And there's a law that says the restaurant has to feed everyone who comes in, regardless of their ability to pay.
Why?
Well, because there was a picture of somebody once starving or being very hungry on the front steps of some callous restaurant owner or whatever.
So there's this restaurant.
If you can get through the door, they have to feed you.
Well, what's going to happen?
Well, people are going to wait till they're hungry, have no money in their pocket, and go and eat at the restaurant.
And what happens is the restaurant has to cover the costs of feeding those people who aren't paying, so they have to raise menu prices for other people.
And what happens then is those other people say, well, this food is getting way too expensive because this restaurant has to pay for everyone else.
So, you know what?
I'm just going to eat at home.
I'm either not going to eat at this restaurant, or if all restaurants have to feed everyone who staggers through their door and claims to be hungry and feed them as much as they want, people are going to say, forget it.
I'm just going to stay home because, like, I'm not paying 50 bucks for a hamburger so that five other people can get a free hamburger.
There's no way.
So then people start avoiding those restaurants, and then that means that the restaurants start going out of business.
And what that means, of course, is that the government has to step in.
Rather than change the law that says the restaurants have to feed everyone who walks through their door, they say, well, now we've got to force you to go to the restaurant, or at least pay for the restaurant, even if you don't go.
And that's kind of what's happening when it comes to Obamacare, which is forcing young people who were being priced out of the market when it came to paying for health care.
Because they were paying for all of the mandated procedures for old people and married people and people with kids.
So like young single men were being forced to pay for, you know, pediatrician visits and fertility treatments and so on, which they don't need and don't want.
Because everyone who had a particular issue would run to the government and say, well, I want this to be covered, to be forced to be covered in insurance policies.
because that way everyone else has to pay for my particular issue, which makes it cheaper for me.
But what it does is it makes healthcare so expensive that young, healthy people don't want to pay for it.
So then you have to force them to pay for it by making them buy insurance and so on.
It's the ever-escalating, flaming dominoes of government expansion that is inevitable when you start dealing with these kinds of things.
So yeah, just think of the restaurant.
How would you run a restaurant?
How could you run a restaurant?
What would happen to the prices?
Of what you are selling in that restaurant.
If you had to feed everyone who came through your door, it wouldn't be good.
So...
Insurance.
Okay.
The basic principle of insurance is that, look, some things in life are predictable.
And some things in life are not.
Some things in life are unpredictable and relatively cheap.
Right?
Some things in life are unpredictable and very, very expensive.
Now, the things that are predictable...
And expensive.
There's no point having insurance because there's no randomness involved, right?
The cost of things that are unpredictable but very high is what you want insurance for, right?
So, for instance, in your house, there are things that are expensive like, you know, in 15 years you might have to replace your windows.
Do you buy insurance for having to replace your windows?
No.
It's expensive, but it's predictable.
However...
Your house burning to the ground or a fire breaking out in your house, that is expensive but unpredictable, right?
And so that's an important issue as well.
And, you know, replacing light bulbs in your house is somewhat unpredictable, but it's cheap.
So you don't buy insurance for that either.
So think of that sort of quadrant.
Unpredictable, very expensive.
That's really what insurance is for.
Now, there are some things that are predictable in terms of you know they're going to happen, but they're unpredictable in terms of when they're going to happen, like life insurance.
We're all going to die, but we don't know when, right?
Because we're not in the movie Kroll.
So, that's an important thing to remember as well.
It's expensive and it's unpredictable.
So, this is what is catastrophic, healthcare insurance, right?
Which is sort of like with your car.
It's predictable that you're going to need oil changes in your car.
And it's not that expensive.
So, you wouldn't buy car insurance for, oh my god, I've got to change the oil in my car.
It wouldn't make any sense, right?
So...
But if you crash your car, you total your car, maybe you, heaven forbid, you harm someone in your car, well, that's unpredictable and very expensive, right?
So it's important to understand that about insurance.
Insurance is for unpredictable, very expensive.
It should not be for taking your car into the shop for regular maintenance.
It shouldn't be for spark plug changes.
It shouldn't be for oil changes or anything like that, or tiny little dings or whatever it is, right?
That doesn't really make any sense.
So imagine how expensive car insurance would be if it covered oil changes and spark plug changes and regular maintenance and also covered an accident that had already happened.
So if you could go and apply for car insurance after you totaled your car, then two things would happen.
Number one, the price of it would go up enormously.
And number two, people would stop buying it.
Because if you can buy insurance for your car after After you've had the accident, then you'll wait until you have an accident, and then you will go and buy insurance for your car.
You need the uncertainty for insurance to work.
Once the event is in the past, it's no longer in the area of uncertainty, but rather just a very known and clear expense, in which case there's no point having insurance for it, because the insurance will...
You'll have to pay for it, plus the additional overhead of the insurance company.
It makes it more expensive as a whole.
So as...
More people cancel their insurance because they're like, well, I can just apply for insurance after I've had the accident.
The price of insurance goes up enormously, which causes more people to cancel their insurance, and this kind of cycle happens.
And then you've got to force people to buy insurance, which again, takes us back to Obamacare.
So it's nice in our minds.
Like, I get this.
And nobody wants sick people to die in the street.
I mean, I understand all of that.
But we have to be intelligent about this rather than just sentimental.
Sorry, I know that's the thing these days.
But it is really going to create a lot more disasters than you pretend you're solving if you just take emotionally reactive, there's a sad person in a wheelchair kind of approach to things.
So this is a huge, huge issue when it comes to healthcare.
You have to force people to buy it because people don't want to buy it because it's nice to have the idea of we'll cover you for pre-existing conditions.
We'll cover you for pre-existing conditions.
It's a wonderful idea.
Unfortunately, it means that people can wait until they get sick and then they can apply.
For healthcare insurance, which destroys the entire possibility, actuarially, mathematically, financially, from a profit standpoint, it destroys the entire capacity for insurance to work at all.
And I think that in many ways, that's the purpose.
Just keep wrecking the machine, keep wrecking the machine, keep wrecking the machine until you get government-run single-payer.
So, remember this.
This is part of the sentimentality.
We need healthcare to be around for the masses for the long period rather than what's going on at the moment.
I mean, if you bought home insurance, if you were allowed to buy home insurance to replace your home after your house had burnt to the ground...
Well, the price would skyrocket and people would abuse it, right?
You can't buy life insurance for somebody who's already dead, right?
You understand, right?
And also just think, again, to go back to what we're familiar with.
And again, I know there's mandated car insurance for a lot of places and so on.
But, I mean, if oil changes and regular maintenance, like, you know, replacing brakes and so on, if all of that was covered by your insurance, would you haggle?
Would you shop around?
Would you take all of that time?
Well, no.
No, you wouldn't.
Because when you're spending your own money on your own stuff, you're careful about what you spend, right?
When you're spending other people's money on your own stuff, you're less careful.
When you're spending other people's money on other people's stuff, you're not really careful at all.
So you wouldn't really care.
How much does the break job cost?
Well, if the insurance is paying for it, You really won't care.
And you'd rate the convenience of just walking in and walking out versus spending the time to do price comparisons to save your insurance company money?
I mean, yes, it's going to come back to you in the form of lower premiums, but only if everybody else does it.
And once you start to socialize that kind of responsibility, it tends to diminish as a whole.
I mean, those of you who've watched me for a couple of years, you know this.
I'm a cancer survivor.
I had lymphoma a couple of years ago and went through the surgery at the wonderful Oklahoma Surgery Center.
Thanks, Ken.
Great guy.
Did a wonderful job.
Barely visible scar, at least as I get older and get more chicken neck that's going to bury itself in my neck folds, I'm sure.
And he did a wonderful job.
So I have a pre-existing condition, a pre-existing risk scenario.
That's not your responsibility.
You should not be forced to pay or subsidize for my health insurance.
I mean...
Everybody knows how health insurance should work.
First of all, parents should buy health insurance for their children before they even conceive, right?
Before they even try, before they start, they should buy health care insurance for their children.
So if your child is born with some significant deficiency, and I'm very sorry to hear about, you know, kids who have these kinds of illness, Michael Buble's son has cancer, terrible, terrible stuff.
So you buy insurance.
Before your child is conceived, and then the insurance would cover that.
The insurance should then, you should contribute to your insurance the most when you're the healthiest, right?
So if you have insurance when you're young and you barely ever see a doctor and so on, then that's when you should pay your insurance.
And when I was younger, I got life insurance and paid a little extra so that it built up a fund so that the insurance would pay for itself after a while.
So that's what should happen when it comes to health insurance.
It should follow you wherever you go.
It should be transferable.
Of course.
I mean, this is how it would work in the free market.
So if I had that kind of health insurance, the fact that I got cancer would not affect my health insurance because it would have been factored into that risk in a general population would have been factored into My health insurance when I was younger and, you know, barely even knew what the inside of a doctor's office looked like.
Ah, youth, you could eat whatever the hell you want.
Stay up all night.
Anyway, so that's how it should work.
But that's not how it's allowed to work anymore.
And we'll get into sort of the reasons why.
So, don't take anything I'm saying.
If you live in the States, think about price transparency and how much you care if other people are paying.
Call up the hospitals.
Ask them for the costs of cancer treatments.
I mean, I did that.
It's really, really hard to get clear answers.
Let me...
Give you another thought here, too.
This is maybe a little bit out of left field, but I think it's really, really important.
I'm writing about this in my new book, The Art of the Argument, out soon.
Here's another way that you can ensure you get healthcare treatments.
Be loved.
Be loved.
So, when I had to jet off down to the States to get surgery for...
For my lymphoma.
I told the listenership.
And people donated to cover the cost.
Because people love what I do, they care about me.
And I appreciate that.
I share the sentiment.
Thank you everyone so much.
And if you want to help out the show, freedomainradio.com slash donate.
Contribute to the world.
Be loved.
Be known.
Be public.
Be visible.
Incur the soft obligations of reciprocity known as being in your community, helping people out, doing the right things for people.
Be part of a charity.
Help people out.
You know, Bake cookies for shut-ins.
Whatever it's going to be, be known and be loved.
And then, even if you don't have health insurance, people will chip in to help you cover the costs of whatever is going on.
Some people are better at making money, and some people are better at being kind.
Now, if the people who are being kind help the people voluntarily who are better at making money, Then they incur a kind of kindness obligation, a reciprocal obligation.
And it happens.
It works in society.
I've seen it a million times.
I'm alive to some degree because of that reciprocal kindness.
In some ways, it's important to be part of your community, to help people, to be a positive influence in the world, so that people care about you being around and want you to keep being around.
Like, you know who can't afford their own healthcare insurance?
Kids, those swarthy parasites.
Just kidding.
Love them.
But kids can't afford their own healthcare insurance.
But their parents will pay for them because they love them.
They want them to be around and to stick around and so on.
So it's a kind of weird thing to look at, but it is really, really important.
Like if you're just some kind of selfish person and you like stay home all the time and you don't even know your neighbors and you don't offer to babysit your brother's kids and you don't offer to, you know, bake food for your some elderly person who needs a little bit of company and you don't get known in a community, don't contribute anything.
It's all just about binge watching video games and whatever it is that floats your boat that doesn't involve interaction with other people.
But then if you get sick and you haven't got health insurance, there aren't enough people who are invested in your continued existence who will help you out.
Now you've got to run to charity or these kinds of things.
And the charities may say you've got to change something about your life or whatever.
So be loved.
It's a weird kind of thing, but love brings with it protection from the vagaries and randomness of life sometimes.
So earlier, and it probably shocked you all quite a bit, I said healthcare is not really that expensive.
And we'll talk about technology.
I know the argument, but you'll be surprised at how easy it is to dismantle.
But like in the late 19th and early 20th centuries, right?
So where did people get their health care?
Well, they got healthcare and health insurance, and this was in Australia and Britain and the US and so on.
There were these things called fraternal societies, or sometimes in England and Australia they were called friendly societies.
And these were kind of mutual aid associations.
You could join or you didn't have to join, but they provided a huge amount of benefit in terms of high cost, high risk scenarios.
So, it sounds like forever ago, but...
It's really not.
Less than 100 years ago, 1920, a quarter of all adult Americans were members of these fraternal societies.
You can still see them like the Elks and the Rotary Club and so on, though they don't have the same impact that they used to have.
So what happened was you would join these societies and you pay sort of dues.
And in return, you would get coverage for healthcare, for healthcare costs and so on.
It's really, really important to understand just how cheap this used to be.
And this is before the medical associations began restricting the supply of doctors, before government insurance and Medicare and Medicaid and Social Security supplements and disability all began paying for everyone's Healthcare, I mean, in the US, way more than 50 cents on every dollar is spent by the government.
It's not really a free market system at all anymore.
It's heavily coded and restricted.
Big problems with malpractice suits and tort law and so on.
We'll get into all of that in a sec.
But it was really cheap back in the day.
So to join one of these friendly societies, these fraternal societies, was between $1 and $2 a year.
Like between one and two dollars a year.
Which meant that a day's wage for the average laborer would pay for a year's worth of medical care.
A year's worth!
Of medical care.
And this is at a time when there was a lot of medical care required.
I mean, just think of all of the stuff that was still floating around, like polio, smallpox, typhus, tuberculosis, like lots of things that were floating around.
And now people say, of course, well, now we have all these machines that go bing, right?
So we have all these machines, and therefore healthcare is more expensive.
Oh my god.
Good job, government schools!
You have really scrubbed from people their capacity to think critically.
Okay, just a couple of issues around this technology.
Like, can you imagine me saying, well, mailing things is way more efficient than email.
Email has really driven up the cost.
Of communications between people.
Because, do you know, before email, you didn't even need a computer, you didn't need any servers, you didn't need an internet connection.
So all of that stuff is very expensive, and therefore the cost of human communications has gone through the roof.
Now you even need a cell phone sometimes.
I mean, it's crazy how expensive it's become.
It's looking at all the costs, but none of the benefits, which is dumb.
Sorry to say it.
I mean, the whole point of economics is to look not just at the visible costs, but the hidden benefits.
So the fact that it's instantaneous.
I had a friend who was in the business world, and he's old enough to remember the days before the fax machine.
Dun, dun, dun.
The fax machine exposed the lives of business people fairly regularly because some customer would call up and say, where's that report?
And you'd be like, oh, it's going in the mail.
And you'd work all night and finish it.
But then when the fax machine came in, the customer would call up and say, where's that report?
And if you had it done, you'd have to fax it to them directly.
And if you didn't, you couldn't say...
Well, I guess you could say, my fax machine is broken, in which case they'd say, go to the copy place or something.
So looking at all the costs without looking at the benefits is sort of pointless.
So sure, there's technology, absolutely.
And you know what that helps you do?
Helps you live a lot longer, right?
The average life expectancy 100 years ago was like in the 40s.
Now, I get it.
Once you made it past being young, being a teenager, you tend to live a lot longer.
But, um, a fewer kids are dying now, and of course, imagine how much money you pour into kids, they die, and it's heartbreaking, terrible, and, you know, to be cold-bloodedly rational about it, it's a negative, it's an economic hit for society, because they don't grow up to be taxpayers, you've just invested in a kid who dies at the age of five, it's a net loss economically for society as a whole, and of course, again, I don't want to sound too cold, heartbreaking for the parents naturally, but, um, Technology is allowing us to live a lot longer.
Now, I know that a lot of life expectancy increases have come about not because of medicine, but because of, you know, better plumbing, better food, and, you know, getting rid of particular diseases and so on.
Well, at least until Third Worlders came in and brought them all back to us, but that's a topic for another time.
So, yes, technology is, quote, more expensive, but it allows you to live longer, and it allows you to live better.
In the time of manual labor, a guy in a wheelchair could barely make any money at all.
But now a guy in a wheelchair can work on the web.
He can do tons of different things.
He can work with computers.
He can play keyboards.
I mean, tons of different things that he can do, because of technology, because of improvements in allowing the mind to...
Pursue knowledge work rather than sort of brute manual labor.
So technology allows us to live longer, which gives us more time to make money to pay for the increased technology that is allowing us to live longer.
You understand?
So let's say...
I mean, just look at my example, right?
So I make X amount of dollars every year.
Now, if I died a couple of years ago because I had cancer because of less technology or less whatever happened, right...
That I wouldn't be alive making the money that I am now.
So the fact that there's all this technology that helped me survive is more than paid for by the fact that I have all this additional money because I'm not dead.
You understand how this technology is not the big issue.
And of course if you look at things like computers and cell phones and all this kind of stuff...
I mean, how much...
I mean, I remember when I was an entrepreneur paying like staggering amounts of money for a couple of hundred megs of storage, like a hard drive that was, you know, it was so slow, it was like there were pygmies in there transcribing things in Mandarin.
And now it's incredibly cheap.
A hundred gigs is like nothing on storage for servers and so on.
So when you look at technology, technology tends to drive down the price and cost of things.
So it's not technology.
Think of how much I'd have to pay to broadcast my show to the millions of you who watch.
Think how much I'd have to pay without all of this cool technology, without this camera, without this microphone.
I'd have to go to everyone's house and do the same speech, which would be tiring and I'd often interrupt things I shouldn't see.
So that's important to really understand.
Technology lowers the price of things, increases the availability of things.
You know, just think of remote control surgeries and stuff flying back and forth across email for experts to look at and so on.
It should lower the price.
And by allowing you to live longer and better...
It increases your earning potential.
So it should be a net positive.
It should not be thought of as a cost.
Like for me to say, well, my show would be so much better if I didn't have to pay for internet access.
That's just a total overhead.
It's like, yes, but that's what makes it possible to...
Anyway, I don't want to flog a dead horse too much because that's not medically sound.
So I think you understand.
Now, why are pre-existing conditions...
Why do they even matter?
Because in a sane free market environment, insurance companies would have to sell you on the fact that insurance would follow you wherever you went, and you get it while you're healthy, and then they can't say no to you while you're sick.
And they would also, by the way, because people always say this, oh, well, what if your insurance company goes out of business, right?
They would have to have a clause that say, we have a backup insurance company, we have some backup system, so such and such an insurance company has agreed to take over your policy at the same rate, should we go bankrupt?
Of course you wouldn't tie yourself to one insurance company, because everyone would know the insurance company might run out of money, run out of business, so for sure.
You would have that handled in the contract.
There would be a backup, and the backup would have a backup, and should things change, you'd get an update.
So naturally, you would have that kind of stuff.
I didn't want to point that out.
So you'd buy it when you're healthy, and then you would reap the rewards, so to speak, or you at least would reduce your cost should you ever have gotten sick.
So that's the way it would work in the free market.
That's what I would want to buy.
What you would want to buy, I'd assume.
Unless you wanted to just roll the dice, right?
And you can roll the dice.
You can choose not to buy insurance.
And you know what?
If you don't get sick, great choice.
Great choice.
If you do get sick, ooh, sorry, snake eyes.
I mean, these are all choices we make.
People can go to the casino.
If they walk out $10,000 richer, good choice.
If they walk out wearing a barrel, well, bad choice, right?
So...
You know, people, of course, they want the benefit of not spending money on insurance, and then they want to get healthcare for free when they get sick.
It's a natural human desire, of course.
Sure, everybody wants to go to the casino and win.
That doesn't mean the casinos have to be forced to comply with that, because otherwise, very quickly, well, there won't be any more casinos.
And then, where's Joe Pesci going to get a job?
Who knows?
I don't know.
It's not working much lately anyway.
So...
Why on earth do people care about pre-existing conditions?
Well, like so many of these mistakes, right?
Like the beginning of restrictions to allowing people to become doctors, which the AMA started decades and decades and decades ago, to shielding people and pushing them out of the healthcare, to the FDA, to this crazy, crazy multi-billion dollar...
This labyrinth that you have to crawl through just to get medicines which are perfectly legal in Europe and other places into the mouths or up the butts of people who need them.
I mean, a lot of these mistakes started a long time ago, and it's like the final giant domino is crashing down on the remnants of the free market and wrecking it.
Unless we, you know, turn things around, which is kind of what I'm suggesting.
Why do we even care about pre-existing conditions?
Well, because your health care insurance has been tied to employment, to your employment, to your job, right?
It's job specific.
Why?
Why?
Your life insurance generally isn't, although there can be sort of key man insurance or key person insurance for...
I had this when I was an entrepreneur in the software field.
If you're really crucial and I was the chief technical officer, you get.
The investors want you to have insurance in case your plane goes down or whatever.
So why is it tied to your job?
Your car insurance isn't tied to your job.
Why is your healthcare insurance?
Well, just another one of the wonderful things like massive communist infiltration into the West that came out of the Second World War.
And in the Second World War in America, the government said, you're not allowed to raise people's wages.
Wage freezes were in effect.
Now, companies still wanted to get the best people.
So what did they do?
Well, they said, okay, we're not allowed to raise your wages.
But, you know, what's something that you pay a fair amount for that we can take over?
We're going to start paying for your insurance.
And then, if the company pays for something and doesn't pay you, then you don't have to pay income tax on that, right?
So if the company's paying $5,000 a year towards your healthcare insurance, then you don't get taxed on that.
If they give it to you and you pay for it, then you get taxed, right?
So you understand the tax system is set up for the employer to pay, and not you, and people like keeping it that way.
But, um...
What that means, of course, is that if your employer is paying for your healthcare insurance, then if you quit or leave your job and you haven't got that set up the way that you wanted to or the way you could in some places, then you lose your insurance.
So let's say you have a job and then you get sick.
And then you get fired or you quit and you go for a new job.
Well, then now you have a pre-existing condition and you have no health care insurance.
So the health care insurance is going to be much higher because you have a pre-existing condition.
Because it's tied to your employer, because of tax and World War II. Because 70 years ago, just crazy, crazy stuff.
And so that's an important thing.
And it's funny, this is an important point, just, you know, I never, I guess I'm like a boa constrictor swallowing an infinite supply of gazelle, I never get tired of pointing this out.
But you see, if your healthcare insurance is dependent on your job, that's kind of great for douchebag employers, right?
Especially if you get sick, let's say you get diabetes or some sort of chronic condition that you need medicine for or whatever.
Well, I mean, it's great for employers because they have huge leverage over you as an employee.
Because they can fire you and then you're out of healthcare insurance and you've got to spend huge amounts more.
Or people won't want to hire you because you're going to add to their healthcare insurance because you've got a pre-existing condition or whatever.
It's terrible.
It gives way too much power and leverage to employers.
Like, oh, you have diabetes.
And so if I fire you...
You are going to have a tough time getting healthcare insurance or maybe even another job.
So I guess you're going to love working weekends now, aren't you?
You're going to pile a little bit more work onto you and ask you to work longer, travel more.
What are you going to do?
You have no leverage.
I mean, you've become a medically bound surf in your job.
Like H-1B visa, you know, the ball and chain that locks employees to their employers and so on.
So, and you know, all these leftists are out there.
Oh, you know, capitalists and owners and employers have way too much power over their employees.
Yes, they do.
And one of the reasons is because of this crazy healthcare stuff that came out of socialized, central planning, price controls, all that crap that came out of the Second World War.
So, you know, hey, lefties, if you don't like the fact that employers have too much exploitive power over their workers, change this.
And that will change an enormous amount.
So, I was talking at the beginning about reduced supply.
So how do you decrease the cost of something?
You increase...
Well, you have to reduce the demand, which is not going to happen.
We've got an aging population and so on.
Well, you increase the supply.
So how is healthcare restricted?
Well, of course, there's medical licensing and all that.
But in 1972, President Richard Nixon, not only did he take the U.S. off the remnants of the gold standard, but he restricted the supply of hospitals.
So, if you wanted to open a hospital, you had to provide something called a certificate of need.
Now, call me crazy.
When I started this philosophy show, I didn't have to show a certificate of need, which is why there is this philosophy show.
So, certificate of need used to be called market research and people who want to buy things in the free market.
You know, if you want to open a restaurant, well, if you want to open a Chinese restaurant, don't open it when there's, you know, eight other Chinese restaurants on the same block.
Certificate of Need used to be, will people pay for it?
But then it became a government thing, right?
In 1974, Nixon also boosted pension protections, which had the impact of strengthening unions for hospital workers.
And this, of course, significantly raised costs for independent doctors and providers.
That incentivized them to merge with larger corporations or leave the marketplace.
I mean...
You can do this research yourself.
Oh my god!
If there's one group of people you really don't want to piss off in your society, doctors would certainly be pretty high up in that category.
The army, yes, but doctors as well.
Oh, man.
Just...
It really sucks to be a doctor in America these days.
Doctors around the Western world are pretty unhappy.
A lot of them say, I wish I'd never become a doctor.
A lot of them say, I'm spending way too much time on useless paperwork.
I'm terrified of my patients.
I'm terrified of lawsuits.
And I'm...
You know, it's just crazy, right?
I mean...
And people go to the GP and say, I'm unhappy.
And it's like, boom!
Here's some psych meds.
Because that's all such proven science.
Anyway, so...
It really sucks to be a doctor in America in a lot of ways, and socialized doctors are even worse in some ways.
So, you put restrictions on medical school intake, right?
So, doctors get to choose through the AMA how many licenses, and along with some government agencies as well, how many licenses are handed out, how many medical school graduates come in.
When customers, when patients are paying for healthcare directly, except for the catastrophic stuff which is handled by insurance, which is rare, Well, that's going to determine how many doctors the medical schools pump out, right?
Supply and demand, right?
But if you give doctors the power To restrict how many people become doctors, well, the doctors are making money because there's a lack of supply of doctors.
And the fewer doctors there are, the more money they're going to make.
And so if you give doctors or their agencies or their lobbying power through the government, if you give doctors the power to limit the supply of doctors, well, I think we know what's going to happen.
Here's another issue.
You know, every year in America, there are literally thousands of young men and women who graduate medical school, but are unable to find residency afterwards, right?
So residency, you need that to get your license to practice medicine.
And these people, many of whom would have the capacity to be fantastic doctors, are totally burdened down with unfathomable levels of debt.
Like on average, The people who've graduated who are seeking these residencies are $183,000 in debt.
Years of their lives.
Burned midnight oil up all night studying for various exams.
Years of their lives.
Massive debt.
And they can't get their residency.
So the world is short one doctor.
Now, you can always apply the following year or the following year or the following year, but the overall supply of physicians is being choked off.
And by the way, You're not allowed to be a truck driver and drive for a certain amount of time before you've got to take breaks and rest and sleep and so on.
Up 24 hours or more and making medical decisions that are life and death, come on, I mean, of all the things, right?
Now, all these restrictions, and there's many, many more, they're kind of favored by the healthcare establishment, right?
The healthcare industrial complex.
They don't want the supply of medical professionals going up because that way they can keep prices high by restricting supply and also keeping people out of the capacity to Right, prescriptions, right?
Writing prescriptions and it being a monopoly of doctors to do that, that's post-World War II that was established by Congress.
Again, before that, it was a whole lot cheaper.
I mean, why, why, why do you need a doctor's visit and a prescription for basic and repetitive medications?
I mean, do you really, really need a dozen years of medical school and training and residency to prescribe antibiotics for routine infections?
Good Lord.
Alright.
Defensive medicine.
A. Worst name for a punk band ever.
And tort reform.
This is important.
You can't bring down the price of healthcare very much.
So you can in a lot of ways, but this area is very, very important.
Tort reform has got to be addressed in the United States.
So, in healthcare, doctors are often running really expensive tests.
They know that they're not needed like 99.99999% of the time, but...
What about that 1 in 10,000 situation where something could be found but they didn't run the test?
Boom!
You're sued into bankruptcy.
This is one of the reasons why malpractice insurance is so incredibly high, the costs of which need to be passed along to patients or the government in some place eventually.
I mean, the U.S. uses three times as many mammograms, two and a half times the number of MRIs compared with other developed countries.
Now, who knows what the right number is?
I don't know.
The whole point is nobody knows, right?
It should be a free market that determines this stuff, but a lot of it has to do with this defensive medicine.
So, a Gallup survey has estimated That $650 billion annually is attributed to this defensive medicine.
And it's you who end up paying the bill for all of that.
So it's not direct treatment for the patient.
It's the doctor, you know, covering his ass.
For fear of being dragged into a courtroom and being accused of malpractice and having to pay God knows what, right?
And this, of course, because all of these, quote, useless tests are being run, and you could say, well, you know, it's worth running 10,000 tests in order to find that one person.
No.
No.
Because everything you take is taken from something else.
Right?
So this creates additional demand.
On these sort of testing facilities and these machines that are already in a reduced supply situation because of medical regulations and legislation.
So that drives up costs again.
But don't worry.
I'm sure that lawyers in America are going to just get together, do the right thing, and reform the tort system that pays them billions of dollars a year.
I mean, we talked about this in the Ben Carson presentation.
1983.
Great surgeon, Dr.
Ben Carson.
He described how he had to go to Western Australia to practice after he got out of medical school.
And one of the main reasons he had to do that, I mean, it's not like you have to go to Western Australia.
Oh my God, I practiced in hell.
I'm not saying that, but he had to go that literally to the other end of the earth.
Because in Australia, there's much lower costs for insurance.
And that was a long time ago.
And this, you know, you want doctors to be sensitive, to be humane, to have good bedside manners and so on.
But, you know, sensitive people facing massive debt, uncertain futures, crazy work hours, and constant threats of lawsuits, it disincentivizes a lot of people from becoming doctors, which again, drops down the supply, drives up the price.
I'm not suggesting you try this for fun, but, you know, you can go through the mental exercise.
I mean, regulations red tape is kind of crazy.
I mean, you want to start up some sort of independent practice?
Oh, yeah.
Good luck with that.
Massive regulation.
Makes compliance with this crazy Brazil-style amount of red tape very difficult.
Unless, you see, if you join a massive established company with teams of lawyers and lobbyists and so on, a compliance department, well, again, big corporations love to raise these soft barriers to cheaper and leaner competition.
So they're not opposed to a lot of hyper-regulation because they already have the legal departments to deal with it.
Drug costs, of course, are a big, big factor.
So the FDA, Food and Drug Administration, they have to approve medicines for use by humans, of course.
And they came out of the thalidomide crisis of the 1960s, where women were taking a pill that was supposed to help them with morning sickness, and it ended up deforming and killing small numbers of children, a couple of hundred in the States.
And this was, of course, tragic and heartbreaking, and the pictures of all this was terrible.
But, as is the case so often with the government, the cure was far worse than the initial disease.
The FDA approval process is so long, it's so cumbersome, that the costs of researching and producing drugs in the U.S. is astronomical.
And still a lot of it gets done.
R&D in the States is very big, and a lot of the world benefits from the R&D that goes on in the States.
And people say, well, the cost of producing the drug is only X amount of dollars.
It's like, that's a second pill.
The first pill is like crazy, right?
So because the FDA process is multi-year, multi-billion dollars or more, it increases the cost of drugs enormously.
And it is a huge problem.
The current drug patent system is a band-aid on this problem and stifles a lot of innovation and so on.
And because the approval process is so long and so expensive, you'll get pills for elderly boners, but you won't get pills for more localized and smaller markets for illnesses, right?
And that is really important as well because it's so expensive and so time-consuming.
You have to have a huge market, which means that smaller markets don't get...
There are credible estimates out there that literally millions of Americans have died because the FDA won't approve drugs that are perfectly legal in Europe and other places, and people have died as a result of not being able to get to them.
So again, a couple hundred kids get sick, get deformed, babies in the womb and die.
Terrible, terrible stuff.
But trying to solve it with a system that has been directly responsible for, or indirectly responsible for in some cases, millions of deaths according to some statistics?
Not a very good solution at all.
So yeah, it's great if people can purchase drugs from other countries.
Good stuff.
But the FDA itself is a huge problem and in my view needs to be abolished.
There are already laws against harming people with your medicines.
There's already suing people for harming you and so on.
You don't need all of this stuff.
I mean you wouldn't want the post office handling drug safety or Yelp for that matter.
It is not a good idea to put governments in charge of this.
And bureaucracies, as you know, particularly in these kinds of life and death matters, tend to be very conservative.
Because if the FDA approves a drug that later turns out to be harmful, it's a massive, massive problem for the FDA. However, if they don't approve a drug...
And people die as a result of not getting access to that drug.
Nobody really knows about it.
Nobody really writes about it.
Nobody really talks about it.
So there's weird, imbalanced political incentives.
And, you know, come on, if you're dying and there's a drug out there that's shown promise in other areas, saying no to it, Dallas Buyers Club, right?
Now, let's talk about specialization.
I mean, don't get me wrong, division of labor, a fantastic, fine, and wonderful thing.
But in some ways, it could be seen to have escalated in the medical field in the U.S. as kind of a cash-grab scheme.
I mean, do you need to see a specialist?
Well, you've got to have an appointment with your GP to be referred to a specialist who may himself refer you to another specialist, etc.
And...
More people in the US are treated by specialists whose fees are higher than primary care doctors when the same types of treatments are done at the primary care level in other countries.
So the pass the buck, make the buck kind of stuff happens a lot.
Now...
To step into a landmine, end-of-life healthcare costs.
So there are some estimates, and some of these have been inflated.
So take some of the stuff with a grain of salt.
It's hard to find actual facts for obvious reasons.
But there have been some estimates that up to half of your healthcare spending in your entire life is going to be in the last six months of your life.
So you can find higher estimates.
I think they're a little too high.
But it's an important question.
If you're old and you're dying, do you want to live in agony for another week?
Or do you want your kids to be able to inherit enough money to buy a nice house?
I don't know.
Tough questions.
Tough questions to ask.
They should not be answered by the government.
They should not be answered by everything being, quote, free, because it leads people to make decisions that they wouldn't make otherwise if they were responsible for their own costs, for their own issues when it comes to this kind of stuff.
Does it make sense to pour $100,000 of taxpayer money to keep someone alive in pain for another three days?
I don't know.
I don't know.
This is something that individual decisions and priests and hospitals and charities and friends and family and ethicists and philosophers should all be in a discussion with.
But if you take the personal calculation out of all of this, then people will just spend like crazy.
And that is something which we need to have more of a discussion about.
But until people are responsible more for their own healthcare costs, it's going to be hard to make any kind of rational decisions.
In other words, I'm saying it's an individual decision.
If you want to burn through half a million dollars to stay alive for another month, And you have the money?
Or your insurance company is going to pay it?
Absolutely.
If the insurance company comes to you and says, listen, let's split the difference.
If you don't want this additional treatment, that's fine.
We're going to give half the money to your kids.
I don't know.
Again, this all sounds harsh, but we have to get out of the fantasy.
That everyone can get all the healthcare they want.
This is all costs and benefits, costs and balances, and so on.
So, I mean, having stared down the cancer-riddled more of death myself, I do have some idea how sensitive these issues are, and I just wanted to remind people that we don't know the answers, but I do know the answers should not be dictated by the state.
So not-for-profits, they can be kind of expensive in the realm of healthcare.
So there are dozens of administrators in most healthcare settings that, you know, are arguably not entirely necessary, right?
See, people are virtue-signaling advertisements, sports team sponsorships, and so on.
Not-for-profit healthcare often means very inefficient healthcare.
So about a quarter of healthcare cost is associated with administration.
Which is higher than in any other country.
So there's one example.
Duke University Hospital has 1,300 billing clerks but only 900 beds.
So they don't even have enough to sleep on if there's nobody there and they want a nap.
My favorite doctor, Dr.
Smith from the Surgery Center of Oklahoma, has joked that it's impressive that not-for-profit healthcare companies need to charge 10 times what he does to not make a profit.
That speaks to some significant and gross inefficiency.
So, what about uncompensated care systems?
So hospitals can get more money from the federal government to the extent they claim to have lost money.
So if you only get $5 for the aspirin you claim costs $100, the federal government is there to, quote, compensate you for failing massively.
So failure is rewarded.
And again, does that do anything to inflate costs within the healthcare system?
It's hard to see how it wouldn't.
So we talked about 100 years ago, you could work as a worker for a day or two for your healthcare costs.
Let's look at Forbes.com.
In 1958, per capita health expenditures were $134.
This may seem astonishingly small, but it actually includes everything, inclusive of care provided for by government or private health insurers.
A worker earning the average wage in 1958, just under two bucks, would have had to work 118 hours, nearly 15 days, to cover this expense.
Right?
So, we're talking about the 1950s.
A worker Who's making two bucks an hour would have to work for 15 days to cover his health care expenses.
By 2012, let's go on with the article.
By 2012, per capita health spending had climbed to $8,953.
At the average wage, a typical worker would have to work 467 hours, about 58 days rather than 15 days.
So that is an enormous growth.
At a time when increased technology should have brought down the price of things.
So, thank you for your patience.
I just want to sum things up real briefly here.
So, how do you fix the healthcare system in America?
Reduce the barrier to entry.
Increase competition.
Disassociate your...
Healthcare policies, your insurance from your job.
Pay for it yourself.
Whatever needs to be done with the tax system to make that efficient needs to be done.
Remind people to be responsible for their own health.
Allow young people to buy healthcare insurance without forcing them to subsidize the healthcare insurance of older people.
Allow charities to do their work.
Be good in society.
Help people in society.
Be loved in society.
Like so many things, the answer is less force, more responsibility, more freedom, more love.
And that's how we heal the world, my friends.
Thank you so much for listening and watching.
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