MORTAL PERIL.

MORTAL PERIL Our Inalienable Right To Health Care?

by Richard Epstein Perseus, $18.00

RICHARD EPSTEIN IS AN IDEOLOGICAL zealot who writes clearly and a devotee of 19th-century classic liberalism who thinks a one-size-fits-all philosophy is adequate for every and any subject. In the case of Mortal Peril, which will soon be released in paperback, and which his publishers hope will create a stir in a renewed debate, the victim is medical care: a subject more resistant than most to an ideological straightjacket.

Epstein begins by going to extraordinary lengths to argue that citizens should not enjoy the right to medical care. He believes in the centrality of property rights and the virtues of allocating any good or service by willingness and ability to pay, nor does he grant any exceptional status to health, illness, or medical care. In his words, the "major question is: Why is this principle [of equal access] appropriate for health care when it has been rejected for vacation homes and fast cars?" From here, Epstein goes on to criticize the notion of a positive right to medical care as not only philosophically questionable, but economically inefficient and administratively impossible. He questions whether medical care is all that important for health and argues that economic growth (and wealth) explains most of the improvements we foolishly ascribe to modern medicine.

Having made that set of claims, Mortal Peril then takes a tour across the vast domain of American medical care. Medicare, he finds foolish. The Clinton health reform plan he regards as idiotic. And the utilitarian and contract enforcing claims he makes for active euthanasia and physician-assisted suicide are not very different from the case for selling body organs. What links these views is the claim that we own our own bodies and that markets (and contracts) are devices of "voluntary exchange" by which the "greatest good for the greatest number" is achieved when supported by the willingness to recognize and enforce contracts. Although no one else has so boldly presented Epstein's utilitarian premises, the clarity of his presentation has the countervailing result: it makes the flaws in his prescriptions and scholarly standards obvious.

The fundamental flaw is that the evidentiary basis of this book is that of a legal brief. To take the area I know the best, Medicare, one clearly sees the triumph of ideological conviction over serious scholarship. To understand the origins and operation of the Medicare program, Epstein relies for intellectual authority on three main, ideologically-transparent sources: Reason magazine, The Cato Institute, and the Heritage Foundation. This is a bit like going to a brothel to discuss the merits of chastity. Unsurprisingly, Epstein concludes that Medicare--and its commitment to social insurance--does not allocate services as a competitive market would. But, after all, Medicare was created to ensure access to medical care for the elderly by removing it from the market. To criticize the inefficiencies of non-market allocation without addressing the core issue of fair access begs the question.

Epstein also overgeneralizes in his attack on public programs. "Government programs" like Social Security and Medicare, we are blithely told on page three, "are organized Ponzi operations that eventually go broke by using the capital of later contributors to satisfy the obligations to earlier plan participants." With equal aplomb, Epstein decries medical systems like Medicare that pour "huge sums of money ... into the last weeks and days of life, money that would do far more for the health of the nation if left in the pockets of young parents to spend on the nutrition and education of their children."

Medicare now draws about 1.45 percent of the paycheck of every worker in the U.S. (and an equal sum from the employer). As with any system of social insurance, small proportions of the wages of large numbers of citizens add up. But not only is it unfair to criticize excessive spending on the last days of life (doctors don't know who is going to die and who isn't) there is no shred of evidence that the repeal of Medicare would enhance the health of America's children. In fact, those seeking to cut Medicare have often had long knives out for child health programs, as shown by the efforts of Republicans in 1995 to cut both Medicare and Medicaid (which is a major provider of health care for poor children).

Epstein also allows simple error to masquerade as serious commentary. He laments the "lumbering structure and bureaucratic incentives" of government medical-care programs, generalizing beyond reason. He is sure that government health insurance "chews up huge portions of its revenues in administrative expenses and loses another significant proportion to fraud and abuse at every level of its operation." This claim is palpably false; Medicare, for instance, is much less costly administratively than private health insurance, spending one to three percent on administration compared with 10-15 percent for private health insurance. (Indeed, there is a good argument that Medicare--and government health programs of the OECD in general--should spend somewhat more on administration so as to reduce fraud, waste, and abuse.) There is simply no comparative scholarship that supports the contention that, among industrial democracies, the public medical sector is the wasteland and the private sector the prudent consumer of administrative dollars. One need only look to the scandals involving Columbia/HCA and Blue Cross in recent years to question Epstein's dogmatic assertion that the government is uniquely wasteful and subject to fraud in its spending of health-care dollars.

To his credit, Epstein does show a keen sense of the difference between an academic intellectual and a serious manager in an industry like health care. The job of academics, he says, is "to describe and prescribe, and to show how the descriptions we give support the prescriptions we propose." In a moment of humility, he concedes that such work is "not a manual of how to play the game or a prediction of the particular outcomes that will follow once the rules of the game have been redefined." Managers, by contrast, have the "task" of finding the "wisdom and courage to know when and how to change doing business."

This modesty, however, should not be taken seriously. Epstein gives away the game when he concludes that the "comparative advantage of the academic perch is its ability to describe the global consequences that will follow from the rules of the game," forecasting that arises "largely [from] abstract knowledge of how incentives shape the conduct of individuals who are primarily but not exclusively interested in advancing their own self-interest." Financial incentives are not simply one element in explaining human behavior; They are practically the whole story, but one that can be told "abstractly."

Alas, Epstein believes one can understand social systems through deductive reason, abstractly tracing out what "will" happen from what the "incentives" tell you. He would have a hard time understanding why every other industrial democracy decided long ago that medical care should be allocated differently from "vacation homes and fast cars." Nor would he find it easy to comprehend--except with the assertion of false consciousness--why other democracies are completely uninterested in any of his prescriptions.

This is a shame since Epstein has, on some subjects, perfectly sensible things to say. He discusses Oregon's health care rationing plan with clarity, properly showing that all medical systems ration in one way or another and that a society cannot give every patient what he wants whenever he wants it. Epstein recognizes the political dynamics that condition our treatment of Medicare and understandably concludes that making medical care a right will further solidify such programs. And, in fairness, Epstein acknowledges the cost-containing potential of global budgets but rightly notes that they "work only as well as the political system that lies behind them." One could go on with examples of individual claims--or topical discussions--which reveal the clarity with which Richard Epstein can discuss issues. The trouble is that this would be like panning for gold in what is, indisputably, a pile of pro-market rocks.

THEODORE MARMOR teaches politics and public policy in Yale University's management and law schools. His most recent book is The Politics of Medicare, Second Edition.