Medicare and Money

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Many people do not understand what money is or why it is even at the forefront of thought in all economic decisions, even when it comes to whether or not your grandma should get cancer treatment.

Let me help you understand.

First, money is valuable because it is valuable. People are willing to trade their time for it, and because people are willing to trade their time for it, you can buy people’s time with it.

All economic goods, from food to medicine, is all the product of someone’s time combined with their ability and the tools and resources they have available to them. The ability is largely dependent on an individual’s natural talent, but much more so on how they have spent their time to refine that talent. The resources they have available to them are available because someone took their time and ability and applied it to get them there.

All of these factors depend, ultimately, on time.

Since humans live about 70 years and then they die, we all have limited time. If we were ageless or immortal, then we probably wouldn’t care about how long things take to do. If it took 1 second or  1 year or a billion years, it would be the same to us. But we are mortal. Each of us will, eventually, die, and so our time is inherently precious to us.

Money represents our time. It is, in essence, a small part of our life. If you treat money as if it were a fraction of your life, or someone else’s life, then you will start to treat it reverently and carefully. You will find you are much more frugal, choosing more often to do without rather than spend someone’s time to meet your needs.

Now, consider grandma’s cancer. Grandma has cancer. She will, eventually, die, either from the cancer or from something else. She has limited time left. She has spent a great deal of time already doing whatever it was she chose to do with her life. Her bank account may reflect the amount of time she used up for her purposes versus the amount of time she used on behalf of others. She has also accumulated other resources, like her children and her grandchildren, maybe her property, and such. These all represent the investments she made with her time.

The decision was made some time ago to invest people’s time into researching cancer treatment and diagnosis. Doctors, nurses, and hospital staff were trained to run hospitals, built with the time and expertise of countless millions of people, both those who put it together and those who brought resources to the building site as well as those who created those resources. We cannot discount the efforts of the architect and board who made countless thousands of decisions after spending time to deliberate about the best way to build this particular hospital. Land was set aside, land that could’ve been used for growing food or building a grocery store or an office building, or even a road that could’ve saved 2 minutes on everyone’s commute every day of the week.

As your grandma enters that hospital, and as the doctor takes time out of his schedule to see your grandma as opposed to anyone else, then as the doctor makes decisions, in consultation with your grandma, further taking up open spots both in terms of who will get what medicine and who will get what time in which facilities, people’s time is consumed.

This is represented with the hospital bill. All those times are represented with a simple dollar value.

If the treatment is more expensive than what people are willing to pay for it, then the doctor has no choice but to refuse to see your grandma. Why? Because there are other people who are more willing to bid for his time and the hospital’s resources.

This is capitalism 101: You cannot force people to do things. They must voluntarily trade their time and money, or there is no deal. If one side says, “I will only do X if you give me Y”, then you can’t get X without paying them Y. Of course, you can negotiate and haggle, but in the end there must be mutual consent to the terms.

(Note that I am not talking about crony capitalism. I am talking about the same capitalism that the guy who sells hot dogs from his cart practices every day. Crony capitalism is not capitalism at all, but socialism disguised, because it relies on government force to work.)

Let’s reword all of the above in terms of money rather than time.

Grandma has cancer. The doctor says, “I will diagnose and treat you, but it will cost several hundred thousand dollars.” If Grandma doesn’t have several hundred thousand dollars, she cannot get treated.

Medicare has distorted the medical field. It does this in a number of ways, but the simple fact that it covers the cost of Grandma’s cancer treatment means that the cost is never considered, either by grandma or the doctor. This means that the doctor, the medicine companies, the hospitals and staff are free to charge almost as much as they want. If they are unhappy with how much money they make, they petition the government to give them even more money,.

This is unhealthy, obviously. Grandma should be in complete control of her health care. She should only be allowed to spend the resources that are given to her. If you wish Grandma could receive more treatment than she can afford, then feel free to send here a few dollars. At the end of the days, Grandma will have to make a decision: Is it best for me to spend the money I have on the best treatment I can get? Should I settle for a cheaper treatment and save my money for the future (or save it for my children?) Or should I forego treatment altogether, enjoy as many of my final moments knowing that there will be more money for others in the future?

Obamacare was proposed because the socialists know that you need some sort of cost control measure. They want to enforce lower prices by refusing treatment altogether for Medicare recipients. That will work, to a degree. However, it won’t be a proper solution because it doesn’t discourage people from charging as much money as they can. Instead, they just have to campaign really hard to get their treatments approved. This is already happening as we see, because certain drugs that are denied to people are already part of the political debate. Such a thing never happened before.

Capitalism says that you allow the individuals to decide for themselves, based on what they have available to them. This sounds harsh, but it means that people who want to have good treatment in their final years will save their own money, doing their best to maximize their wealth in their final years.

It also means, and this is the key component, that they will seek the best treatment they can get at the cheapest price possible. This will drive doctors, hospitals, and drug companies to invest in providing the best care possible cheaply. You will see, under such a scenario, advertisements encouraging people to use particular hospitals or particular treatments, not because they are necessarily superior to all the others, but because they keep their costs deliberately low while providing better service.

If we can put these economic forces to work, we can dramatically decrease the cost of health care. I wouldn’t be surprised if cancer treatment became as cheap as pineapples and bananas are in the supermarkets. Of course, we today think of these things as cheap commodities, but at one point they were the most expensive produce in the world, worth more than their weight in gold.

Imagine if cancer treatment for grandma cost only $10, without a single penny in subsidies from government. It is possible, and it will happen, because everywhere capitalism is introduced, prices fall, supply increases, quality increases, and demand is met.

 

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