Rationing Health Care

Lately we've touched upon the absurd cost of medical services in the U.S. -- we spend twice as much as the next biggest spender and three or four times as much as others -- and we're less healthy for it. There are a few reasons for this, but here I'm going to touch the third rail.

In the United States, in contrast to other nations, if the FDA approves a treatment, insurance has to pay for it. The FDA does not consider cost, but only whether there is evident of clinical benefit that outweighs risks or (non-financial) harms. The definition of benefit and harm, and how to value them, is of course far from obvious, but we'll put that aside for now. What we absolutely are not allowed to do within the U.S. political discourse is ask whether a treatment is worth the money. To raise that question, even in principal, will get you accusations of moral depravity. The proposition that single payer health care will lead to "rationing" is enough to kill it.

As a result, Medicare, Medicaid and private insurance companies pay for cancer treatments that cost more than $100,000, even $250,000, and give the typical patient a few extra months of not very healthy life. To anyone who objects, the rejoinder is that human life is "infinitely precious," that you can't put a monetary price on life, that to turn out backs on people who could live because we don't want to cough up the money to keep the alive is monstrous. I bring this up today because the FDA has just approved a treatment for Alzheimer's disease that costs $26,500 a year, and has been found to slow the progression of early stage Alzheimer's by about 27% over 18 months. After that, it's pretty much useless. It is to be discontinued once people head into moderate dementia.

So, you're still going to end up in the nursing home wearing a diaper and being spoon fed, unless you're lucky enough to die first. It will just happen four or five months later. We are all going to pay for it. So, I'll leave it up to the peanut gallery. Is there a defensible argument against this? And do you know how they deal with this sort of question in the rest of the world?