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Insurance – "How Much is Healthcare a Right?" | UChicago Provost Katherine Baicker
64 Plays1 month ago
Dr. Katherine Baicker is the Provost of the University of Chicago and one of the most respected voices in health economics. Dr. Baicker explains that we shouldn't just be asking if healthcare is a right. It's time to set a coverage floor based on "how much of a right it is."
As a former member of the President’s Council of Economic Advisers and Principal Investigator for the Oregon Health Insurance Experiment, Dr. Baicker explores what makes the U.S. healthcare system so complex — and why comparisons to other countries often miss the mark. She discusses her vision for a “Medicaid-for-All” model that balances universal access with innovation and fiscal sustainability. Finally, we dive into how economics can help us navigate the hard trade-offs between equity, efficiency, and innovation in healthcare’s future.
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Transcript
Introduction to Healthcare Reform and Innovation
00:00:00
Speaker
Welcome to the Healthcare Theory Podcast. I'm your host, Nikhil Reddy, and every week we interview the entrepreneurs and thought leaders behind the future of healthcare care to see what's gone wrong with our system and how we can fix it.
Dr. Katherine Baker's Background and Health Policy Studies
00:00:15
Speaker
Today's guest is Dr. Katherine Baker, a health economist at the University of Chicago who now serves as provost of the college. Dr. Baker was once the Dean of the Harris School of Policy, and she led one of the largest and most important health policy studies of all time, which is the Oregon Health Insurance Experiment.
00:00:33
Speaker
In today's episode, we dive into what the study's findings were for Medicaid and for health insurance as a whole, Then we dive into why health insurance is often a lot more complicated to fix and answer than you might expect.
00:00:46
Speaker
And of course, at the end, we dive into
Early Career and Motivation for Healthcare Improvement
00:00:48
Speaker
Dr. Baker's vision for a Medicaid for all model, where we have a single baseline for care that still prioritizes innovation and strong access to health care.
00:00:58
Speaker
Hi, Dr. Baker. Welcome to the Health Care Theory and thanks for coming on today. We're super excited to have you. Thanks so much for the chance. Of course. And I mean, early in your career, you were both working both working in like academia and government, especially while at Harvard. And you really had a pretty wide variance in the type of roles you're working on. And what actually got you into the health care system? And what were the formative experiences that really led you to think about like this system needs some fixing? And that's where you wanted to spend your time.
00:01:25
Speaker
Sure. um I came to health economics as someone who'd always been interested in public policy. When I went to college, I didn't have any idea that I would study economics. I thought I was going to study political science and public policy and go into working directly in public policy.
00:01:43
Speaker
But as I started to get different ah tools through my different classes, I realized that economics was an incredibly powerful way to make good decisions about complicated programs.
00:01:55
Speaker
and decided that was the approach that I wanted to take to answer those public policy questions. So went to grad school in economics and my fields of expertise or my fields of concentration were public finance and labor economics because I was interested in the social safety net, in unemployment insurance, in education, in Medicaid, in food stamps, in all of the different ways that we can use public dollars to provide a safety net and do that as efficiently and effectively as we could.
00:02:28
Speaker
Then my first job out of grad school was in academia, in part because it's very difficult to go from direct application, from government service or from private sector into academic research. Whereas if you start in academic research, you may have opportunities to work in public policy or to have work in the public sector, in that private sector.
00:02:54
Speaker
So I thought that that was the right place to start. And as I started diving in to safety net programs, it became very clear that Medicaid and the healthcare care system are such an important part of people's wellbeing and so complicated. It's a whole world of economics just contained within health
Complexity of US Healthcare System Compared to Other Countries
00:03:16
Speaker
economics. So after a couple of years, I stopped calling myself or thinking of myself as a public finance economist and really thought of myself as a health economist whose mission was to provide better information for better people
00:03:30
Speaker
public policy to improve people's access to high quality, affordable healthcare. Of course. And i mean, that's great, right? Because you and economics in some way can be the foundation of a good public policy.
00:03:44
Speaker
And we'd love to hear. I mean, our healthcare system varies pretty drastically from the Canada, u k Germany. And in some ways, it's like a Frankenstein of all of them, where like some people are Medicare and Medicaid.
00:03:54
Speaker
some Sometimes their employers are paying for it. Sometimes it's a marketplace. It's pretty complicated. I'd love you could like quickly kind of walk us through like what makes our system so different from the other ah these other countries.
00:04:06
Speaker
And what are some common misconceptions that the public often has about health care insurance? Yeah, and that's a ah big question. And as you've alluded our health care system is incredibly complicated. And we could spend more than the time we have available for this podcast just talking about the different elements of
Misconceptions About Health Insurance Systems
00:04:26
Speaker
the U.S. health care system from public insurance, as you noted, Medicare and Medicaid, to private insurance.
00:04:33
Speaker
Most people get their private insurance through their employer, but now there's ah an increasingly robust non-group or individual health insurance market to the millions of people who are still uninsured and don't have access to public or private health insurance and still get some healthcare through uncompensated care, but often don't get all of the healthcare care that they need.
00:04:55
Speaker
That incredibly complicated patchwork leaves a lot to be desired in terms of broad access to high quality care and affordability of the whole system.
00:05:07
Speaker
So I think there are all sorts of improvements that are possible, but there are also a lot of misconceptions about how health insurance works, as you pointed to, in general and in the U.S. in particular.
00:05:20
Speaker
For example, the U.S. spends almost twice as much per capita on health care as a lot of other developed countries. our public insurance program is just as big as their public insurance.
00:05:33
Speaker
It's just that we also then double that amount in the private sector adding on. So I think people maybe misunderstand how important the public sector is to health insurance in the US.
00:05:46
Speaker
The other thing that I think is sometimes misunderstood is how the insurance systems that other countries have would work in the US.
00:05:58
Speaker
When people look at places like Sweden or other Scandinavian countries and say, why can't we just have that system? They pay less per capita than we do, and they seem to have outcomes that are just as good.
00:06:11
Speaker
Well, the population looks very different in those other countries.
Role of Public Policy in Healthcare and Fiscal Federalism
00:06:16
Speaker
Sweden actually might not be that different from Minnesota, and what we spend in Minnesota and the outcomes in Minnesota might actually look pretty similar to those in Sweden.
00:06:26
Speaker
But we also have Mississippi and California and New York and Texas and populations with very different baseline health care needs and age profiles and income profiles. We have much more income inequality in the U.S. s than lots of those countries that we're compared to.
00:06:47
Speaker
So I don't think that those systems would be the right answer for the U.S. I don't think that you could take this system from a small level homogeneous European country, drop it in the US and get anything like the results that you get in that small, homogeneous European country.
00:07:06
Speaker
So those are just a few things that I would start off with. Yeah. And you touched on a lot of things there and we can clearly see the healthcare. This question about healthcare care insurance is much more complicated than people would think. Like, as you mentioned, we have a very heterogeneous population. The people in Hyde Park often or can be different from someone in San Francisco. It's like Little Rock, Arkansas. It's very different populations. So even then, it's hard to make a system that's a one size fits all.
00:07:30
Speaker
um But when you have like so many different layers of questions, like where'd you spend the beginning of your career in academia and um in the early 2000s, like where were you kind of spending your time researching and what are the major questions that you wanted to answer when you first started off within healthcare economics or economics?
00:07:47
Speaker
Well, ah part of it, i I mentioned that what motivated me was social safety net programs and understanding how to deliver safety net programs more efficiently and effectively so that we ensured as a country that the safety net was present for healthcare and food and housing and the like, but did so in a way that was compatible with you know having a robust working population that you know supported
00:08:21
Speaker
their own needs as much as possible and stretched all of the public dollars as far as possible so that those systems were sustainable and affordable and there for future
Oregon Health Insurance Experiment: Medicaid's Impact
00:08:31
Speaker
generations and that dollars were going to the places where they would do the most good.
00:08:37
Speaker
And if you don't design systems that are incentive compatible, as economists would put it, and that are financed at the level that's needed to sustain them, then that safety net's not going to be there when people need it.
00:08:51
Speaker
So I started off trying to understand which level of government was the right one to provide ah particular service or to deliver a particular public good. Again, to use some some economics jargon, the federal government is the best to do some things.
00:09:10
Speaker
Local cities, counties, municipalities are best positioned to do other things. States do some things and they all interact with each other and some federal programs generate spillover effects to states, that generate spillover effects to localities. So thinking about fiscal federalism and how we actually deliver on those programs in the most efficient way and at the most effective level possible, given how very different populations look in different places and how different people's preferences are. That kind of got me into public finance and health economics.
00:09:45
Speaker
But one thing that you hit on in your intro is I've also been incredibly grateful to have the opportunity to work in academia for most of my career, but also have a chance to work directly in public policy in government.
00:10:00
Speaker
I did a couple of different scents on the President's Council of Economic Advisors. I was on the Medicare Payment Advisory Commission. I chaired the Massachusetts Group Insurance Commission. I'm still on the CBO panel of health advisors.
00:10:14
Speaker
All of those are mechanisms to help bring what we learned in academia about the trade-offs in public policy and healthcare into advising policymakers so they can make the best decisions possible From a legal perspective, from a regulatory perspective or a legislative perspective, a regulatory perspective, an administrative perspective, vis as you know these are really complicated policies. And if we don't take the best evidence that we have and make it something that is useful and usable for policymakers, then I'm i'm not sure what the point is.
00:10:48
Speaker
Yeah, and it's something funny. like you I mean, you mentioned how these are very complicated, but you're not saying that in a way that you're like kind of scared of the comp complexity. It seems like you're excited about it in a way, and you can kind of see that through the Oregon Health Insurance Experiment. We guys really undertook a very kind of big, arduous task. So, I mean, back in 2008, for some context for the audience, I mean, Oregon had um kind of Medicaid spots for low-carb adults, and then um Dr. Baker led an experiment to see, to give... um and Medicaid and insurance and new enrollees to kind of measure ah randomized trial, of what would happen when people get health insurance and what do those results look like?
00:11:25
Speaker
um And we'd love to kind of hear like, why was that such a golden opportunity to answer these big questions? And um how'd you kind of go about this study in the first place? Yeah, no, that's a ah great question. Of course, it's one of my favorite topics. It's a research project that along with my co-principal investigator Amy Finkelstein at MIT, we spent, you know, the better part of a decade working on this project that I think produced results that are still incredibly relevant for policymakers today.
00:11:54
Speaker
And it was an unprecedented opportunity to answer some of the big questions in public health insurance and in health insurance more broadly, which is what does health insurance do to health care consumption or you know use of health care and access to health care health ah financial well-being. Insurance is supposed to be not just about access to care, but also helping ah you weather those health care needs financially.
00:12:21
Speaker
And then, of course, health outcomes, mental health, physical health. How much better off are people with insurance versus being uninsured? And you would think that those are easy questions to answer. And surely we must know the answers to those questions already.
00:12:36
Speaker
But they are not so easy to answer. And a lot of the evidence that we had left glaring holes that we had the opportunity to fill. So let me give you an example.
00:12:47
Speaker
ah When asked what does health insurance do to physical health outcomes, to mortality to management of chronic physical conditions, you might think, well, it's pretty obvious that insurance should make people healthier.
00:13:05
Speaker
But there were real questions. Does a program like Medicaid actually increase people's access to health care or were they getting plenty of health care through uncompensated care and it's just somebody else was paying for it?
00:13:17
Speaker
Does Medicaid pay providers enough that they actually see patients that if you have Medicaid, you have access to providers or can you not get an appointment? Is ah the care that people get of sufficient quality to actually improve their health outcomes?
00:13:33
Speaker
Do people take worse care of their health because they have this safety
Unexpected Findings and Their Reactions
00:13:37
Speaker
net? There are all sorts of mechanisms that might be in play. And before our study, um people had to rely on observational studies or maybe quasi-experimental studies, and I won't spend too much of our time getting into the technical details there, I'll just give you one example.
00:13:55
Speaker
Suppose you wanted to know the effect of Medicaid on mortality. how much you How much longer do people live if they have Medicaid, if at all? Well, Medicaid is a program for low-income people.
00:14:08
Speaker
If you look at the outcomes, if you look at the mortality for people on Medicaid, they actually have a higher mortality rate than the uninsured. So you might think, well, wait a minute, comparing having Medicaid to being uninsured, it actually increases your mortality to have Medicaid.
00:14:25
Speaker
The problem with that inference is that being low income is one of the mechanisms through which you get Medicaid and being low income in and of itself is very hard on your health.
00:14:37
Speaker
You also get access to Medicaid by being disabled. Being disabled in and of itself is very hard on your health. And so if you don't take those into account well enough, you will mistakenly attribute to the program itself some of the outcomes that are actually being driven by other confounding factors like income or baseline health needs.
00:14:59
Speaker
So we had this unbelievable opportunity in Oregon where the state had a waiting list for its Medicaid program. And it drew names from the waiting list by lottery because that seemed like the most fair way to allocate a limited number of spots.
00:15:15
Speaker
They weren't trying to generate the perfect experiment. They were trying to do something fair for their population. But it so happened that that generated the perfect randomized controlled trial of Medicaid.
00:15:27
Speaker
So Amy Finkelstein and i jumped on that opportunity along with a lot of other colleagues at our institutions in Boston with collaborative institutions in Oregon with amazing assistance from the Oregon Medicaid authorities to help us study what happened to people's healthcare use, their financial wellbeing, their mental health, their physical health. And we studied, uh,
00:15:53
Speaker
civic engagement through voting. We studied criminal justice interactions. We studied credit through credit reports and labor force participation through social security records. We got all of the data we could to take advantage of this amazing opportunity.
00:16:09
Speaker
And I'd love to kind of hear, like, what did we learn overall from that experiment? Because my understanding is that kind of contrary to what people might expect, like, I mean, of course, people who got Medicaid were happier, they were less depressed, they had less financial strain, but also, and they did report overall better health. But I also know one big fact was like, it did not really change, didn't have significant changes on the physical health and chronic health of some patients.
00:16:32
Speaker
um indications in areas. And um could you really unpack like these results? I know there was like a big, like, how do people react to this? I know there's kind of used like a political football, something you've talked about before. And why did we see just positive impacts on mental health and financial stability, but such, like, I guess, relatively less improvement on the physical health side in terms of the physical health outcomes?
00:16:54
Speaker
Yeah, you put your your finger on a lot of the key findings, some of which were more surprising to the outside world than others and and different ah people reacted very differently. a lot of yeah the results were so nuanced that people on both sides of the aisle, people in favor of expanding Medicaid, people not in favor of expanding Medicaid could find something in our study to point to. So it it gets cited a lot, but often for very different reasons.
00:17:24
Speaker
So
Understanding Trade-offs in Healthcare Policy
00:17:25
Speaker
like let's pick at some of that healthcare care use. When you make something lower cost by insuring it, people use it more. So this is not surprising to economists. Demand slopes down.
00:17:37
Speaker
Health insurance used to be unaffordable for a lot of people who then got insurance that made it more affordable. So they used more health care. People went to the doctor more. They went to the hospital more. They used more prescription drugs.
00:17:50
Speaker
But one thing that was very surprising to people is they go to the emergency room more, not less. And I think there had been some hope in some sectors that if people got Medicaid, they would go to the primary care doctor instead of using the emergency room for things that didn't need to be treated in the emergency room.
00:18:09
Speaker
And so emergency use would go down, but it didn't go down. It didn't stay the same. It went up substantially. So that was very surprising to people. I don't want to discount the financial well-being aspects. People were much better off financially. They much less likely to have bills sent to collection. They were much less likely to report that they had to borrow money or couldn't pay their bills. So it really helped people out a lot financially. And the mental health results, I think, are really important. There is huge unmet mental health need in this population.
00:18:42
Speaker
And we saw dramatic drops in rates of depression. And that's not just depression. feeling better or feeling happier, this was a reduction in clinical and incidence of clinical depression that I think is really important not to discount.
00:18:58
Speaker
But let's go to those physical health outcomes that you point to. I use mortality as an example at the beginning. Our study didn't have enough people in it to be able to detect changes in mortality because fortunately for a prime age population, our study had people 19 to 64, there is a small enough mortality rate, which is a good thing that we couldn't detect changes in mortality, but we had enough people in the sample to detect changes in physical health conditions like blood pressure. And we did not find any detectable changes in blood pressure. And in fact, for that, for that,
00:19:34
Speaker
we could estimate it precisely enough to rule out the kinds of changes in high blood pressure that people would have expected from those observational studies or quasi-experimental studies that didn't have the opportunity to benefit from the randomized control experiment that we did.
00:19:50
Speaker
um That was very surprising to a lot of people who thought that surely health insurance would reduce blood pressure. And we could rule out all sorts of um potential explanations they had for why that would be the case. Maybe you didn't wait long enough. Maybe you didn't have a big enough sample.
00:20:08
Speaker
To me, those didn't seem to be the explanation. It is, however, consistent with the fact that we have chronic high blood pressure in lots of segments of the U.S. population covered by private insurance or Medicare. I think I'm speculating now because our study can't speak to this, but I think what a reasonable explanation is, that people entered the same healthcare care system that everyone is in that doesn't do a great job of managing high blood pressure.
00:20:38
Speaker
And so the fact that Medicaid did not ah cure people's high blood pressure, to me, speaks to the effectiveness with which we manage that type of chronic condition in the U.S. healthcare care system overall.
00:20:53
Speaker
And kind of thinking about these results today, right? That's pretty multifaceted. There's no like clear answer, like what we can do.
Vision for a Sustainable Medicaid for All Model
00:21:00
Speaker
And now you've had, I guess, like quite a few years and you've had a lot of like research about like your different ideas how our healthcare care system should look.
00:21:07
Speaker
um One thing you've kind of talked about is like a Medicaid for all, like a basic coverage floor. um Almost like you kind of see other countries, with like supplementary supplementary insurance on top of that. We'll have to kind of hear like, what are your thoughts and what our healthcare care system can and should look like if you really have like a drawing board to like kind of control?
00:21:24
Speaker
i know it's ah mainly a question that even the top politicians in the United States can't really dictate, but in a theoretical world, what would you like it to look like based off these findings? And how did that change the way you think about the healthcare insurance system?
00:21:38
Speaker
Well, it's a ah great opportunity to first um be clear about what things studies like the Oregon study can tell you and what they can't tell you. And one thing i think everyone thinking about these questions should start with is, what are your policy goals?
00:21:58
Speaker
What are your preferences? You know, when we produce these results from the Oregon study, I think we showed that Medicaid has ah benefit for the people enrolled. They have better mental health, they have better access to healthcare, they have less financial strain, they report that their health is better. So there's benefit to the people enrolled.
00:22:18
Speaker
And there's a real cost. It doesn't save money. You don't save so much money in people getting out of the emergency room or going back to work that somehow it pays for itself. It doesn't pay for itself. It comes with big costs. And the cost is usually borne by taxpayers who are not themselves Medicaid beneficiaries.
00:22:36
Speaker
So you've got one group that is benefiting and another group that bears the cost. And so reporters would ask, does this mean we should expand Medicaid or not? And as a researcher, my answer was always, it depends how you value those costs and benefits as a policy maker.
00:22:54
Speaker
I can't as a ah data scientist or economist or healthcare care researcher tell you which you care about more, the health of lowin income adults or the education for children or roads or housing for people.
00:23:11
Speaker
There are trade-offs for all of these things. And you as a policymaker and as a voter need to make decisions based on what your priorities are. So that's one place to start is that the study shouldn't purport to tell you what your preferences are. And I would never dream to tell you what your preferences are, even though, of course I have mine as a Well-informed, I hope, citizen and voter.
00:23:37
Speaker
I certainly have my own preferences about these things and i vote accordingly. um But if the goal is to have an affordable, financially sustainable health care system that guarantees a social safety net, I think we need to ask much more clearly, how much health care do we want to ensure that everyone in the U.S. has access to?
00:24:05
Speaker
And that is not the way the question is usually framed. People often say, do you believe that healthcare care is a right or not? And I don't think that's a very carefully posed question because healthcare care is not one thing.
00:24:20
Speaker
You don't either have healthcare care or not. There's a whole continuum of healthcare care that you might have access to. So when we think about housing, if you think that housing is a right,
00:24:35
Speaker
You probably don't think that that means everyone should live in the same house. you There's a and sort of minimum threshold that you have in mind, whatever that is, with the understanding that higher income people are probably going to live in nicer houses.
00:24:54
Speaker
And that is the reality of income inequality. And the healthcare care system can't be used as a vehicle to undo a really wide distribution of income in the US.
00:25:06
Speaker
If you
Balancing Cost Control and Innovation in Healthcare
00:25:07
Speaker
want to um do income redistribution, do income redistribution through the tax code. Don't try to do it through the healthcare care system because that's a recipe for an inefficient healthcare system and ineffective income redistribution. yeah So If you start with the question, how much health care is a right?
00:25:27
Speaker
There is a virtually unlimited amount of health care that could be delivered to any one person. And I would argue that we cannot afford to deliver that near infinite amount of health care to every citizen in the U.S. with the public health insurance system.
00:25:43
Speaker
there's just That's more than 100% GDP. So that requires... so that requires having a real public dialogue about what that floor level of healthcare that everyone should be entitled to is.
00:25:57
Speaker
And based on you know polling results and and decades of public discourse, I think it's safe to say that most people in the U.S. would put that floor well above zero.
00:26:10
Speaker
I think most people would say, we don't as a society want low income people dying in the street of curable things where we could as a society afford to provide that care.
00:26:23
Speaker
So think most people would have a threshold way above zero for how much healthcare is right. But I think when forced to confront, does that mean that public insurance should pay, say for you an extreme example, $10 million dollars for a treatment that would have a 10% chance of extending somebody's life by a week?
00:26:44
Speaker
I think most people would say, we should take that money and buy lots of other things that would do lots more good in the world. Well, somewhere between zero and near infinity is a line that we should draw to say how much, what is the floor of healthcare that we think everybody ought to have?
00:27:03
Speaker
That's why I framed such a thing as more like Medicaid for all than Medicare for all, because it involves making an explicit decision about what level of care is acceptable to us as a society. And then as you pointed to ah acknowledging the reality that that means higher income people are likely to have more care than that and therefore have better health outcomes.
00:27:28
Speaker
And that is a pretty ugly conclusion that no one, few people want to wrestle with publicly. But i I would argue that we are in that world right now but not in a way that has a guaranteed floor and not in a way that is explicit about it.
00:27:44
Speaker
Let's bring that out explicitly and have a public debate about what that outcome should look like. Yeah. And it's interesting. you kind of touched on a lot of different realities of the situation. I think a lot of people, i mean, as you mentioned, they kind of answered that question wrong. It's more like it is a continuum of care, but also, um yeah, I think you've noted that economists really get a lot of flack for putting a price tag on healthcare.
00:28:07
Speaker
But I mean, as we're economists, right? Or at least you're an economist. Like there's a lot of trade-offs and costs, which are like when you don't put costs on healthcare, care it's hard to make those trade-offs as a policymaker to come to the right decisions, like answer these debates in a structural and a productive way.
00:28:22
Speaker
but I mean, within like kind of our system and the reality of where we're at today, like what do you kind of imagine healthcare care looking like and evolving over like the next 10 years based on these discussions? And how would you kind of want it to change? Because of course, Medicaid for all is ah would be an idyllic system, but it requires more people than economists to raise their voice and hope for this to happen. So we'd love to kind of hear like, where do you kind of envision our health concerns health insurance system looking like and what are some things that we or the audience can do to position it in the in a right way going forward?
00:28:54
Speaker
Well, it's a great question. And of course, I'm an economist. I'm not a policymaker and no one has you know elected me to make these decisions. I also
Future of US Healthcare and Challenges of Reform
00:29:04
Speaker
for a long time, people have been saying that the current system is unsustainable and therefore has to change.
00:29:12
Speaker
Yet there have not been major health reforms that have addressed some of these core issues. I think Obamacare or the ACA made real strides in expanding insurance coverage.
00:29:27
Speaker
I don't think it was nearly as successful as it wanted to be in reducing health care spending or, as I would um put it more um productively,
00:29:41
Speaker
increasing the value of every dollar that we spend in the healthcare care system. I don't think it went nearly as far in increasing value as it did in expanding coverage. And so we're still left with a system that is fundamentally unsustainable.
00:29:57
Speaker
I think when you look at um the return to rising healthcare costs in Medicare and Medicaid and affordability of insurance four people who are purchasing it on their own or through their work,
00:30:11
Speaker
How we get from here to there, i don't know. You know, the the politics of it seem intractable. So I have to think that there is some public will for things to change, given what is an inefficient health care system that is not delivering care to all U.S. citizens.
00:30:36
Speaker
On the other hand, I would not want whatever fix we see. to inhibit innovation in the system. Because I do think a huge share of the medical innovation that people around the world enjoy comes from US.
00:30:55
Speaker
And the fact that you asked at the beginning about misperceptions, let me come back to two potential misperceptions about the US healthcare care system relative to the rest of the world.
00:31:05
Speaker
One that you hit on a little bit is that think people imagine single payer systems to look much more monolithic than they actually do.
00:31:18
Speaker
In most single payer systems with air quotes around that, in fact, higher income people do have ways of buying more care or ah remove working outside the system to get additional care or to top up their care through the system. So I think those single payer systems don't look nearly as single payer as people imagine.
00:31:42
Speaker
But the second potential misperception is that if we adopted the pricing structure in other countries,
00:31:54
Speaker
we would be able to spend much less on healthcare care and still generate the kind of innovations that we all want. We do generate innovation in the U.S. that benefits everyone in the world. And if a small open economy has restricted pricing, that doesn't fundamentally change the innovation ecosystem.
00:32:19
Speaker
Whereas if the U.S. adopted that pricing, we're a big enough market that's influential enough on investment in future healthcare care innovation that we would see, i think, substantial changes in the medicine that's available. So we can't imagine that we can just import other countries' price controls and not have any effect of that innovation. now you can say, you know what, I don't want any more healthcare innovation. I think it's already too expensive.
00:32:48
Speaker
And let's not subsidize innovation and let's let medicine stay the way it is. I don't think most people would answer in that way. It's a legitimate question to say, how much do we care spend on health care? But I think most people would say if innovation is extending life expectancy and, you know, helping people live longer and healthier lives, there's no problem spending more on health care. The problem is if we are spending a lot of money that's not generating that better quality of life and longer life.
00:33:18
Speaker
So to
Reflections on Healthcare Complexity and Public Discourse
00:33:19
Speaker
come back to the question you you just asked, I don't know how we get from here to there, but I very much hope that people have in mind that long-term trajectory of medical innovation and helping to cure disease and people to live longer and healthier, and the distribution of access to that increasingly high quality care that we need, um I think as a society, to address more comprehensively and intentionally.
00:33:51
Speaker
Access to that care for people who do not have access now in a way that is financially sustainable for the system so that that care will continue to be available for future generations.
00:34:03
Speaker
Of course. And I mean, I wish we had more time, time for more questions. But I mean, there's a lot of other things we could answer, right? Like how copayments and deductibles can reduce waste, which is like some topics that Richard Thaler and also Dr. Joe Newhouse, the future guests have talked about.
00:34:17
Speaker
And there's like, of course, we just talked about drug pricing. And there's so much more in healthcare care insurance and the healthcare care system that more broadly that needs to be answered. And um needs to be democratized an extent, but we really appreciate you coming on today, Dr. Baker. I feel like we've all learned a lot, I assume, just about the way our healthcare insurance system works today and some of the kind of unusual dynamics that you kind of see, where which makes it really hard to translate economics to public policy.
00:34:43
Speaker
These questions are a lot more nuanced than other the people expect. But thank you so much, Dr. ba Baker, for coming on today. um we Really appreciate your time. Thank you so much for doing it. I'm so glad that you're taking the time to bring extra information to people. And I'm very glad you're doing a whole series because the healthcare care system is very complicated.
00:35:03
Speaker
Thanks for listening to The Healthcare Theory. Every Tuesday, expect a new episode on the platform of your choice. You can find us on Spotify, Apple Music, YouTube, any streaming platform you can imagine.
00:35:15
Speaker
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