Exactly. The moral hazard of 3rd party payor systems in health care is a huge problem that nobody is addressing in healthcare reform. The key to decreasing costs is for patients to more fully realize the cost of the medical resources they are so quickly to consume almost unnecessarily, not further distributing the cost to everyone else. The mentality of “someone else will pay for it” is incredibly destructive.

That is why other countries have adopted global budgeting. That is the least painful and most equitable form of dealing with the truth that the people here are saying.

The reality is that social reasons are the ones that are necessary. You may call them socialized if you will. But society has to come to some consensus as to limits.

The problem if you have multiple states and multiple insurances, that is people with no insurance, various degrees of private insurance from HSAs to high deductible to cadillac plans, to VA, to Medicaid, to Medicare, to IHS, and to SCHIP, etc. it is impossible to ask one group to make a sacrifice for the others and it is impossible to impose priorities or solutions in an equitable manner.

Why should a patient sacrifice a marginal service within Aetna so that the stockholders get a greater dividend and the CEO get a greater bonus? He already makes 21 million a year. Limitation of care and profits simply do not mix. If there is a system built on priorities then one can allocate money or deny services based on those publicly determined priorities. It is the difference between the publicly mandated Supreme Court making a decision or a private club making a decision that effects the public. The reality is that the Supreme Court decisions may overlap with those of the private club, but there is no doubt that the publicly selected Supreme Court has the legitimacy of society to make such a decision. The private club may be filled with equally talented lawyers but it has potential conflicts of interest and has no legitimacy to make such decisions. Society is not likely to support a private club. The secret cabal in Iran decided that the election of Ahmadenejad was fair and the errors were minimal. That may have been true but this was a private self perpetuating group of unelected “guardians’ making a decision on behalf of the broader society. It was illegitimate if only for that reason.

The reality is that the European “socialized” health care systems are based upon public legitimacy and ours is not. Would we accept a military draft run by a private company who in a privatized way would fight the war in Afghanistan for profit? Of course, we would not. But we have that in health care in America.

Legitimate powers are better equipped to make tough decisions regardless of market forces. Therefore European or Canadian social systems are better capable of keeping costs down than pseudo market forces.

The reality is that as a Nobel Prize was awarded for research that showed decades ago that the decisions in medicine are very asymmetric. The patient wants to have no pain and wants to live. The doctor has all the information. It is an asymmetric relationship and so market forces do not apply. For market forces to work, there has to be symmetry and both sides have to have parity of information to make informed decisions. There are very few economists left who believe that market forces would work in health care. Believing in market forces in medicine is not sound economic theory.

One of the most predictable of human medical expenses is pregnancy. It has an estimated delivery date of nine months. How many of the people who believe in market forces in medicine do comparison shopping for the cheapest maternity service around? How many insurance companies have set up a system to encourage mothers to go to the cheapest maternity hospital? How many hospitals have gone into such promotions? Would our society accept such bidding? No because every one’s priority is to the best for the baby.

Bohdan A. Oryshkevich, MD, MPH