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June 2011

June 30, 2011

In Shared Decision Making There Can Never Be “Too Much Information”

Naomi Freundlich

“Empowered patients” and “patient-centered care” are key goals of the current health reform legislation. The idea is to get patients and their families intimately involved in making decisions about treatment and encouraging them to play a more proactive role in the course of their own medical care. In order to do this, patients must have access to up-to-date and evidence-backed information about the comparative risks and benefits associated with many interventions or diagnostic tests. Patient advocates call this the "quantitative imperative" and insist that access to such unbiased information is absolutely necessary to ensure truly shared decision-making.

But in a recent article in The Hastings Center Report, Peter H. Schwartz, an investigator at Indiana University’s Center for Bioethics, challenges this imperative. He raises the question of whether for some patients, there is such a thing as too much information. For individuals with a poor grasp of probability and mathematical concepts, argues Schwartz, quantitative risk and benefit information could actually be confusing and unhelpful; ultimately leading them to make irrational decisions about care. Mandating that all patients receive this information, he believes, is “deeply flawed” from an ethical perspective.

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You Can Support our Engineering Library Auditorium…or You Can Turn the Page

Harold Pollack

(Cross-posted at the Reality Based Community)

I was eating dinner the other night, and the phone rang. It was an undergraduate classmate noting that I had yet to contribute to our class’s annual giving. She’s a nice person. I also have warm feelings towards Princeton, which opened valuable opportunities and treated me well. So I gave seventy-five bucks.

I gave, not entirely happily. My electronic and snail mail boxes are stuffed with fundraising missives presented with an urgency more appropriate to Oxfam than for one of America’s very wealthiest nonprofit institutions—one that educates some of the most privileged young people in the world. (My favorite: “Great news! If you are making a concerted effort to not pay your $50 class dues, you are well on your way to success!”)

Last year, my own undergraduate class donated $5,101,985 to Princeton’s annual giving. It was a big reunion year. And I don’t begrudge anyone’s charitable giving. Still, this is out of proportion. As of June 30, 2010, Princeton’s endowment totaled $14.4 billion. That’s almost $3 million for every enrolled student. Princeton is a great university, a national treasure. It just doesn’t need the money.

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June 27, 2011

“Leading from Behind”—Not a Bad Obama Strategy, Actually, for Gay Marriage

Harold Pollack

(Cross-posted on the Reality-Based Community)

Governor Cuomo is getting well-deserved praise for his active leadership in passing gay marriage legislation in New York. President Obama’s supportive but basically passive stance on the same issue has received somewhat lower marks. I’m all in for marriage equality. I’ve criticized the president for his timidity regarding other issues. Still, I believe he’s getting a bit of a bum rap here.

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Graph of the Day: The GDP Growth Myth

Benjamin Landy

Last week, I looked at income inequality levels in several OECD countries, demonstrating that not only does the United States have the highest inequality of its peers, but also that it does by far the least to redistribute wealth through taxes and social transfers. Although US tax rates are currently at a fifty year low, conservative lawmakers remain extremely wary of increasing social welfare programs or taxes on the wealthy, which they claim would kill jobs and slow growth.

But according to research by Princeton political scientist Jonas Pontusson, the argument that "European"-style redistributive policies would significantly slow the economy is largely a myth.

SME vs LME GDP graph

In the above graph, taken from data in "Inequality and Prosperity: Social Europe vs. Liberal America" and from the OECD, Pontusson defines OECD countries as either "social market economies" (SMEs), which have higher rates of taxation and more robust entitlement programs, or "liberal market economies" (LMEs), which tend toward the "market-liberal view" that redistributive taxes, transfer payments, and other social programs like universal healthcare inevitably distort markets and undermine efficiency. However, if this were true, we would expect to see substantially worse economic performance among the SMEs. In fact, the SME's average real GDP growth rate per capita exceeded that of the LMEs from 1960 to 1980, and remained nearly the same from 1980-2000. And GDP per hour worked, at purchasing power parities, was also higher on average in 2002 for the SMEs than the LMEs, despite fewer overall hours worked. Although the LMEs outpaced the SMEs by 0.6% from 2000-2010, it is important to remember that their economic gains were also distributed less evenly, meaning a higher percentage of GDP growth is attributable to their top quintile earners than the middle or bottom quintiles.

Clearly we need to change the way we as a country calculate the supposed tradeoff between inequality and efficiency, and look more objectively at what policies have worked for "social" Europe and why.

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June 25, 2011

Was it a Political Mistake to Pursue Health Care Reform?

Harold Pollack

There’s a meme going around that health reform was a central strategic error of the early Obama presidency. On this view, it was a mistake to spend so long waging trench warfare to pass the Affordable Care Act. For example, Time’s Joe Klein believes that President Obama misread his mandate:

In 2008, Barack Obama wins a smashing electoral victory, largely because the public believes he’s a calm, cool adult who can lead the country out of an economic crisis. But for some crazy reason, he decides to focus much of his attention on passing a universal health care plan that has been the long-term dream of his party. This, despite polls that indicate nearly 80% of the public are satisfied with the health care they already have. The plan passes, but it’s so complicated, the public isn’t sure what’s in it (and is wondering why the President hasn’t focused similar attention on the economy), and Obama’s party is clobbered in the 2010 elections.

I disagree at TNR. Even so, I fear that one legacy of the health reform fight will be a certain domestic policy Vietnam syndrome facing any future new president who is contemplating addressing big complicated problems such as immigation or global warming. It’s all too easy to imagine his chief of staff closing the door and saying: “Do you really want to fight Verdun over this, risk possible failure, and sacrifice the best year of your presidency?” Our sclerotic legislative structures are damaging our ability to address big problems.

June 24, 2011

Errors in Medical Claims Processing Cost Health Care System Billions Each Year

Naomi Freundlich

Here’s a health insurance headache most readers can relate to: My son took a bad fall in an indoor soccer game this winter and fractured his wrist and pinkie toe. He was diagnosed and treated in a specialized emergency room at an orthopedic hospital that accepted our health insurance; in total we were there a very reasonable two hours and my son left sporting a wrist cast, sling and a surgical shoe. Before leaving I stopped by the reception desk to find out about co-payments and other charges we might have incurred: “Don’t worry,” the billing clerk told me, “we will submit all the charges to your insurance.”

The wrist healed quickly, the surgical shoe was abandoned after two days and my son eagerly went back to bouncing off the gym walls. Then the bill from the emergency room came. Among the assorted charges not covered by our insurance was $218 for a “short leg splint calf to foot.” As I mentioned, we left with a “shoe” that consisted of an inflexible sole held in place by Velcro straps—definitely not a “short leg splint.” As my family’s de facto health advocate who has spent countless hours battling overcharges, coverage denials and outright billing errors, I assumed a phone call to the billing service would clear this up. Well, five months and two subsequent statements later, I’ve just received “final notice” that if I don’t pay the splint charge it will be sent to a collection agency.

Undoubtedly there are few among us who haven't encountered similar insurance hassles; substitute blood test, MRI, anesthesia, out-of-network provider, brand-name drug or any number of medical devices or interventions for “short leg splint” and this becomes a universal tale. For cancer patients and those undergoing surgery and hospitalization these disputed charges become a more serious problem, adding up to tens of thousands of dollars in potential debt.

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June 23, 2011

Turning the Afghan Ship Around

Jeffrey Laurenti

 “Moving the ship of state is a slow process,” President Obama replied two years ago to a Turkish student impatient for more dramatic changes in American foreign policy.  “States are like big tankers, they're not like speedboats. You can't just whip them around and go in a new direction. Instead you've got to slowly move it and then eventually you end up in a very different place."

The reduction in American troop levels in Afghanistan that Obama announced last night completes just such a gradual but complete reversal in course in U.S. policy there.  Obama has overturned the highly militarized model his predecessor adopted after the ouster of the Taliban, replacing it with a strategy based on a political resolution of Afghanistan’s conflicts.

Here in London, British officials this morning privately marvel, as do British commentators, at Obama’s boldness in standing up to the generals, whose insistence on maintaining high combat levels through next year’s fighting season was backed by the secretaries of defense and state.  Instead, he has mandated the complete withdrawal next summer of the “surge” reinforcements he approved in late 2009.

His decision makes clear to the U.S. military that this president is resolutely determined, in his words, to “wind down this war,” and will not be bulldozed into continuing it by body-counts and other supposed metrics of victory on the ground.

The announcement also sends the signal to President Karzai and Afghan military leaders:  They had better be able, starting now, to inspire their own troops to hold their ground against the insurgents.  They cannot dither till 2014 expecting American soldiers to do the job. 

And it is an unmistakable warning sign to the kleptocrats who are subverting the Afghan government from within:  The United States is tightening the spigot on the funding flows they have tapped to enrich themselves.  Afghanistan has to clean house and engage its people in building a sustainable peace.  

“We will not police its streets or patrol its mountains indefinitely,” Obama emphasized last night.  “That is the responsibility of the Afghan government, which must step up its ability to protect its people, and move from an economy shaped by war to one that can sustain a lasting peace.”

Obama had another Afghan audience in mind, too: the Taliban.  If Taliban leaders need to reassure their fanatical fighters that their entry into negotiations is not a capitulation, the president’s substantial U.S. troop reduction should provide what they need.  It doesn’t meet their longstanding demand for the withdrawal of all foreign forces as a precondition for talks—but they can spin it as close enough.

After all, Lyndon Johnson did not meet Hanoi’s demand for a complete cessation of U.S. bombing of North Vietnam before talks could start.  Ho Chi Minh accepted a partial bombing halt as good enough to open the Paris peace talks.  

Obama pointedly did not specify the pace of subsequent reductions, nor did he commit to a complete withdrawal.  Instead, he underscored that “we will be able to continue targeting terrorists”—a vow to continue the lethal targeting by drone strikes, particularly in Pakistan, that has been taking so many Taliban commanders and higher-ups to premature martyrdom. 

So if you want to get all our troops out, he telegraphed to the Talibs (and, for that matter, to their Pakistani friends), you have to negotiate a comprehensive settlement.

In his exquisitely calibrated messaging to all the Afghan parties, Obama struck only one false note.  Peace talks, he said, “must be led by the Afghan government.” 

Unfortunately, the Afghan government is in no condition to lead peace talks.  The Taliban adamantly insist that Karzai’s government has no moral or military legitimacy.  And many disillusioned Afghans both in the Kabul political system and in the wider society do not trust Karzai’s people to negotiate with the Taliban on behalf of Afghans’ national interest, but only their own private interests.

Not everyone in Washington accepts Obama’s strategy.  John McCain expressed dismay.  The chairman of the House Intelligence Committee, Mike Rogers, offered the traditional Republican critique: “The president is trying to find a political solution with a military component, when it needs to be the other way around.”

Of course, their preference for military solutions with a political component is what George Bush and Donald Rumsfeld pursued so doggedly for seven years. Obama in his speech took pains to remind voters of the “second war [they] launched in Iraq” and “the profound cost of war -- a cost that's been paid by the nearly 4,500 Americans who have given their lives in Iraq, and the over 1,500 who have done so in Afghanistan.”  

Even some Republicans are beginning to waver in their support for prolonging the war, as presidential candidate Jon Huntsman demonstrated in decrying Obama’s failure to order a more rapid withdrawal.  Tea Party enthusiasms coursing through the Republican electorate, too, run more toward good old-fashioned isolationism, which Obama gently upbraided Wednesday night.

Focusing on the conservatives’ costly but futile war record, Obama sought to turn the political tables.  “Over the last decade, we have spent a trillion dollars on war, at a time of rising debt and hard economic times.… America, it is time to focus on nation building here at home.”

Graph of the Day: Income Inequality, Continued

Benjamin Landy

Although we primarily looked at the United States yesterday, increasing income inequality is undeniably a global trend. Economists and politicians frequently cite the inexorable process of “globalization” as the driving mechanism for this change. As low-wage labor in Asia and the third world became available to world markets, multinational corporations had little reason to maintain their manufacturing bases in America and Europe. The blue-collar jobs that supported much of the middle class disappeared overseas, causing wages to decline for less educated workers. A corollary hypothesis is that we have experienced “skill-biased technological change,” with advances in information technology shifting demand toward highly skilled and better educated labor. The profits from consequent gains in productivity likewise filtered to the top.

International income shares comparison                                                                                           (Source: Piketty and Saez, 2005)

However, while the entire world has been affected by globalization, not all first world nations have suffered equally. In fact, the increase in income inequality in several European countries has been mild in comparison to the United States, suggesting that the economic impact of globalization can be mitigated by effective policy, including taxes and social transfers.

Although we will be looking more closely at the so-called "social market economies" of Europe in later posts, it is worth noting here that the higher taxes and lower income inequality of the SMEs has not adversely affected their GDP growth, as is often claimed would happen in the United States if we were to adopt similar policies. In his 2005 "Inequality and Prosperity: Social Europe vs. Liberal America" (a Century Foundation book), Princeton University professor Jonas Pontusson demonstrated that GDP growth rates for European SMEs actually outpaced liberal market economies (LMEs) like the United States from 1960 to 1980, and remained at nearly the same rate through 2000.

  Gini graph

The above graph, which compares national Gini coefficients (a measure of inequality wherein ‘1’ represents all the money in the economy going to one individual, and ‘0’ indicates complete equality), shows that the United States is by far the most unequal society of its peers. (Social scientists often cite a Gini coefficient between 0.4 and 0.5 as a tipping point for potential social instability, though no such fears have yet manifested themselves in the United States.) Although several nations have comparable levels of inequality before taxes and transfers -- including a few with even higher levels of inequality, like Italy and France – the United States continues to do the least to redistribute wealth to the poor and middle class.

View more from the Graph of the Day Series.

June 22, 2011

The State of the States in Developmental Disability (It's Not Good)

Harold Pollack

I posted an item on the New Republic website about state policy trends in intellectual/developmental disability (I/DD) services. I draw on the recently-released compendium The State of the States in Developmental Disabilities 2011, which includes data up to 2009. (Thanks to David Braddock of the University of Colorado, who provided additional data for the piece.)

Between 2008 and 2009, 23 states reduced their inflation-adjusted I/DD spending. If one excludes the federal portion of such spending, forty-seven states reduced their spending on such services. (See the chart below the fold). State budgetary retrenchment is the deepest anyone has seen since the late 1970s when records were first kept. These trends are really concerning--not least because things are likely to be even worse today than they were two years ago, given the sunsetting of federal subsidies and enhanced Medicaid matching rates provided within the 2009 federal stimulus bill.

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Myths about Medical Malpractice

Maggie Mahar

A few days ago, I found myself involved in a debate over malpractice suits on The Heath Care Blog. One reader on the thread explained why, in his view, we need some type of tort reform: “What drives physicians to practice defensive medicine is the total lack of objectivity, fairness and consistency both across jurisdictions and even within a jurisdiction as to how medical disputes are decided.  Juries of lay people who cannot understand the often conflicting scientific claims in these cases can be easily swayed by emotion and sympathy for injured plaintiffs.

 “The inclination to practice defensively is especially prevalent in ER’s when the doctor and the patient often don’t know each other and there is time pressure to determine a diagnosis and send the patient on his or her way,” he added. “I’ve heard from plenty of doctors who work in inner city ER’s that even poor people are not shy about suing when there is a bad outcome if they can find a lawyer to take their case which they often can.”

This comment pretty well sums up the conventional wisdom about medical malpractice cases:  Juries are not objective, don’t understand the evidence, and tend to sympathize with the patient. Meanwhile, doctors should be wary of those low-income patients in ERs. Americans are litigious by nature and if patients are not entirely happy with the outcome, they’ll jump at an opportunity to turn misfortune into a payday. Poor people, who need the money, are even more likely to try to “score.”

Those are the fictions.

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