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Health Care As Consumption

Antonin Scalia’s now-famous comparison of compulsory health insurance to compulsory consumption of broccoli has been widely criticized on many grounds, but not on its implicit assumption that health care (as opposed to health insurance) constitutes consumption. Conservatives like to portray health care as no different from any other good, and emphasize that if  you make it too readily available then people will want to consume too much of it. There is some truth to this. There are a few hypochondriacs out there who adore going to the doctor and would go again and again and again if the cost of doing so were reduced or eliminated. Most of us, however, typically dread going to the doctor, because it’s not actually a very pleasant experience, even if—as I am—you’re rather fond of your doctor. Those of us who haunt doctors’ offices and hospitals the most (and run up the lion’s share of medical costs) do so because we are very sick, and to whatever extent we have a “choice” it’s between accepting medical intervention and committing suicide. Part of this group includes people who are unconscious or otherwise so incapacitated that they are at best only dimly aware that they are engaged in consumption. They end up in hospitals because someone else is presumptuous enough to compel them to go there by calling an ambulance, an activity that any sincere libertarian ought to condemn.

When my wife was being treated for the liver cancer that eventually killed her I used to break the gloom now and then by contemplating that I had managed to become the highest-paid person at the magazine I worked for. Not even the editor or the publisher was costing the parent company as much as I was, simply by virtue of being married to an unusually conspicuous consumer of extremely pricey medical care. The parent company was (at the time) Microsoft, which had a fabulously generous health care plan because it was (at the time) an astonishingly profitable near-monopoly with an unusually youthful workforce. The only disease common to Microsoft employees, I used to joke, was megalomania, for which there was no cure. 

When it became clear that my wife was no longer responding favorably to chemotherapy her doctor informed her that it was time to stop consuming his services and to start consuming instead the services of a local hospice. Hospices are, from consumers’ point of view, the biggest bargain in the health care market, because they provide services at absurdly cheap rates (insurers adore them) and because they never fail to deliver the promised outcome, which is death. If health care were a real marketplace delivering goods and services comparable to the rest of the market people would be lining up to get in.

If my wife had not had any health insurance, then the prohibitive cost would have limited severely her consumption of health care, and to the extent she consumed any of it at all the cost would have been paid by you, dear reader. She would have been what economists call a free rider. Her health care costs, to the extent we did not pay for them ourselves, would have incrementally raised everybody else’s health insurance, but market discipline would have probably caused her to die within three or four months instead of the three and a half years she managed to give to me and our young children. That’s the way it typically goes for people who lack health insurance and become very sick.

Poor people who have health insurance coverage are unusually greedy consumers, because they are more likely to get sick than rich people. This fact, combined with the uncontrolled growth in medical costs, may be the most powerful force for wealth redistribution in the current economy. The catch is that you only get to enjoy this redistribution if you get sick, and to enjoy a lot of it you have to get really sick and probably die.

To whatever extent third-party payments increase consumption of health care, the fault lies principally not with patients, who typically don’t relish being probed or cut open or being subjected to any number of other physical ordeals. It lies with doctors, who profit from excess care and don’t have to endure the accompanying physical discomfort. This is a real problem, discussed at length by Shannon Brownlee in her excellent book Overtreated. But the same conservatives who condemn the individual mandate requiring mandatory purchase of health insurance also condemn (as “government rationing”) any and all attempts to limit doctors’ and hospitals’ profit maximization through performing medically unnecessary tests and procedures on the elderly (the only segment of the population about whom this is even discussed). What market fundamentalists seem to expect is that patients will tell their doctors to stop being such spendthrifts. But to make this aspect of health economics work you’d have to send every medical patient to medical school so he or she would know which procedures were worth the money and which weren’t. The whole conversation gets pretty idiotic pretty quickly because health care is not, in fact, consumption, any more than your inhalation of oxygen is consumption. It depresses me to contemplate how stubbornly Scalia and many others insist on believing otherwise.