Privatization Blues

A false appeal to authority, a shady statistic, and a reckless slander, all in one brief commentary—that’s the upshot of Mark Hyman’s call for privatizing hospitals.

Hyman claims the solution to rising health care costs is to make all hospitals private. His proof? A study done by the Reason Foundation.

That sounds pretty impressive—the Reason Foundation must be a pretty level-headed lot, if they’re calling themselves that, right?

You’d think so, right up until you did a little poking around and found out that the Reason Foundation is a libertarian think tank devoted to doing away with what it regards as overly strict environmental regulations on businesses. More generally, the foundation is in favor of privatization of more or less everything. Not surprisingly, they receive huge amounts of money from the usual suspects when it comes to funding right wing think tanks.

So the Reason Foundation might have a point of view based entirely on what will provide the best medical care to all Americans. That by itself doesn’t make them wrong, but it should make us a bit suspicious.

Hyman’s use of a statistic cited by the Reason Foundation report shows us that these suspicions are warranted. Hyman notes that a study by the Department of Health and Human Services under the Bush administration showed that a stay in a public hospital costs more than a stay in a private hospital. Hyman suggests this means public hospitals are spending money inefficiently. He notes:

The study concluded that inefficiency, a conflicting mix of social, political
and business objectives, and a lack of desire to control spending contribute to
higher public hospital costs.

In passing, we should also note that Hyman lifts the phrase “inefficiency, a conflicting mix of social, political, and business objectives” word-for-word from the executive summary of the Reason report without reproducing the text on screen, saying “in the words of the authors,” or using any other cue to let the audience know he’s borrowing exact phrasing from his source. There’s a word for that . . . hmmmmm . . . it’s not coming to me right now . . .

Anyway, you don’t need to do a lot of number crunching to figure out why such a difference would exist. After all, public hospitals are required to take on all patients. As a result, they treat a far larger percentage of people without health insurance. If you don’t have health insurance, you don’t get preventive care and medication. The result? People end up going to public hospitals for longer periods of time and for more serious afflictions (on average) than patients at private hospitals.

In other words, what Hyman (and Reason) attempt to portray as simply inefficient and wasteful spending is largely a product of the humanitarian mission of the public hospital. The “conflicting mix” of objectives Hyman refers to is the desire to both keep the hospital doors open and treat all patients, regardless of their income or health insurance coverage.

Private hospitals can turn patients away if they can’t pay (except in an emergency). Public hospitals won’t do that. Hyman uses language that is meant to suggest that public hospitals don’t have their act together or can’t come up with a coherent mission statement. The fact is that public hospitals do have clear objectives. It’s just that they have more than the single objective of turning a profit.

And “a lack of desire to control spending”? The phrase is meant to conjure up images of RNs wheeling patients into the operating room on gurneys upholstered in Corinthian leather while doctors in Armani-designed smocks get scrubbed up with Evian water. But as we just noted, the lack of desire to control spending is in fact the desire to treat people who can’t pay rather than letting them suffer and die in the street.

Then Hyman takes what was a rather routinely distorted commentary and takes a turn for the truly ugly. He begins by saying that “another study” showed that private hospitals offered better quality care for less money than public hospitals. What other study? Hyman doesn’t say. What he does say is that

[w]hat is not known is how many of the nearly 100,000 people who die every year
from medical negligence can be attributed to inefficient and often
poorly-equipped public hospitals.

Yes, it’s not just that public hospitals aren’t cost effective—they’re killing people. Every doctor, nurse, orderly, and candy striper who works at a public hospital is smeared by this statement, which suggests that not only are public hospitals not spending money as carefully as they should, but that the people who serve patients in them are negligent in the care they provide. If you’re looking for some connection between the cost-effectiveness argument and the alleged negligence of public hospital staff, you’ll be looking for a while. Hyman offers none.

But what’s a little slander when you’re out to privatize the world? Conservatives worship at the idol of the invisible hand of the free market, assuming that it will always make things come out right. This fetishization of privatization in all walks of life is troubling, but especially so when it comes to medicine. Consumers are often not well-informed about medical issues, and therefore can’t practice the miraculous rationality the free market model assumes they’ll exercise. Moreover, do you really want decisions about your health in the hands of folks whose ultimate goal is to turn a profit? Of course, if you’re in an HMO, you probably already know what this feels like.

The elephant in the room on all this is universal coverage. Hyman ponders how many people have died from supposedly lackluster care in public hospitals. I wonder how many people would have died had their not been public hospitals that take people in without health insurance. I also wonder how many people will die this year because even though they live in the wealthiest nation in history and hold down a job, they can’t get insurance that will help pay for routine preventive care and medications.

But for folks like Hyman, there’s no room at the health care inn for those who can’t pay their own way. If you’re one of the more than 40 million uninsured, just go fend for yourself in the stables.

And that’s The Counterpoint.

Hyman Index: 4.29