CS314 - Unhealthy Numbers

[Penner]

I just listen to this podcast and I thought that it was great. I love that Dan went over the real world numbers and also what he has gone through buying healthcare and also the other bs that goes with it, both in the pre and post-Obamacare world.

[Okeefenokee]

[Fife]

It had a great beat and was easy to dance to.

[Speaker to Animals]

It had a great beat and was easy to dance to.

[Fife]

The keyboards were fantastic.

[tue4t]

Came across this rather detailed (and long) analysis of US health care expenditure recently. A lot of interesting regressions and modelling.

https://randomcriticalanalysis.wordpres ... tperforms/

In my prior few posts I made a strong case that the United States’ exceptionally high health care expenditures are well explained by its unusually high material standard of living. In response to this several people I have interacted with have fallen back to the position that something still must obviously be uniquely wrong with the US health care system because US outcomes are significantly below what one might expect given its level of spending:

They believe it cannot be a coincidence that the country that spends so much more than expected (according to naive expectations) also gets worse outcomes than expected and generally gets worse outcomes than the most developed countries of predominantly European and Asian origin.

In this blog post I will address the so-called “outcomes” dimension and explain why these apparently sub-par outcomes are not only not otherwise inexplicable, but can actually be explained in a fairly straight forward and parsimonious fashion.

He finds that healthcare outcomes are more strongly predicted by,

1. An Income effect. Actual individual consumption of all goods and services. Overall positive, but there is a negative effect with wealth and obesity rates.
2. Social development effect. Homicide, sanitation, traffic deaths, family formation etc.

much more than just healthcare expenditure. Healthcare expenditure only tracks with GDP/wealth.

So in a society with incomes much higher than you would expect for their social development, you'll get high amounts of healthcare spending for what seems to be a subpar outcome compared to a society that has relatively less wealth but same social development. The US is consistently like an outlier when it comes to material wealth, which explains the healthcare spending outlier.

No relationship between healthcare expenditure and e.g. life expectancy when comparing other developed countries excluding the US.

Even amongst reasonably well developed countries life expectancy is determined significantly by factors beyond economic development and, especially, health care provision. There is only so much the health system knows how to do. If the population makes poor choices (see: excess calories, limited exercise, smoking, drugs, reckless driving, etc) the best, most cutting edge, medicine can only do so much to counter-act them. Much of the high efficacy technology, know-how, etc is highly diffuse, broadly similar amongst even reasonably developed countries, and the returns to additional expenditures are rapidly diminishing everywhere, ergo we see little evidence that health care expenditures independently explains much of the overall variance in better specified models. Health expenditures, meanwhile, are strongly predicted by economic development, especially as measured by AIC (largely without hyper-rational cost-v-benefit calculation), which, in turn, is substantially determined by cognitive and social development, which predict risky behaviors that affect life expectancy.

Therefore, if you have a country that outperforms its average level of cognitive and social development with respect to AIC, you should expect it, ceteris paribus, to spend substantially more than equivalently developed countries (especially due to the non-linear rate of increase) while achieving substantially worse outcomes than its level of health expenditures or its level of economic development would naively predict. The apparent disconnect between health-spending-and-wealth and health-outcomes-and-spending are substantially connected; they are not entirely idiosyncratic differences that are orthogonal to expenditures or economic development.

Also argues a negative income effect (obesity etc) which biases towards wealthiest countries because healthcare technology and know how is diffused between developed countries. Though I think this explains why cancer outcomes are better in the US, because that specialty knowhow is probably not as diffuse as other types of medical knowledge?

As the positive effects of income start to diminish (sanitation, water, public health, vaccines, etc) the negative effects associated with income (obesity, diabetes, etc) are likely to start dominating mortality trends amongst the relatively more affluent countries (or at least they are likely to if they don’t manage to dramatically change the trajectories vis-a-vis obesity, diabetes, etc). This does not necessarily mean life expectancy will decline, since technological improvements in medicine, public health, etc are apt to offsets these issues to some degree. However, because the technological improvements tend to be diffuse and, in the long run, not particularly proprietary to rich countries or beyond the reach of those with more limited budgets, the average marginal effects between countries are apt to be non-trivially negative amongst those that are already highly developed.

Also of interest

US life expectancy is dramatically depressed by the south and Appalachia. The more northern and coastal states of the east and west coast do quite well on average and counties in neighboring states further removed from these regions tend to as well (see South Florida).



If US life expectancy was reduced primarily because of peculiar differences in how health care is managed and paid for in the US, as most of its detractors argue, I would expect most places to be substantially below average. Instead what we find is many areas performing fairly comparably to N/W Europe (before accounting for confounders) and some regions with fairly distinct demographics and histories contributing dramatically to mean underperformance despite sharing very similar health care systems vis-a-vis reimbursement practices, hospital types, etc as the rest of the United States.

Nor, for that matter, are these patterns well explained by poverty rates, income, or lack of health insurance. We tend to find similar patterns even if we control for these things.

[DrYouth]

Nice post Tue4t...

Just listened to this...

It was a great episode.... Not sure why Okee is killing himself laughing.

Dan nailed this topic. I also notice he is assiduously avoiding The Donald.

Did I miss some killer counter arguments in this thread?

[Okeefenokee]

Nice post Tue4t...

Just listened to this...

It was a great episode.... Not sure why Okee is killing himself laughing.

Dan nailed this topic. I also notice he is assiduously avoiding The Donald.

Did I miss some killer counter arguments in this thread?

apparently.

[DrYouth]

23 pages in now...

If I have a chance I will sift through.

(If anyone wants to link to a good page I'll start there.)

[Okeefenokee]

23 pages in now...

If I have a chance I will sift through.

(If anyone wants to link to a good page I'll start there.)

It starts on page one and continues from there.