December 31, 2018

Times of resistance

The economist Albert O. Hirschman famously argued that citizens of democracies have only three possible responses to injustice or wrongdoing by their governments: we may leave, complain, or comply. But in When All Else Fails, Jason Brennan argues that there is a fourth option. When governments violate our rights, we may resist. We may even have a moral duty to do so.
For centuries, almost everyone has believed that we must allow the government and its representatives to act without interference, no matter how they behave. We may complain, protest, sue, or vote officials out, but we can’t fight back. But Brennan makes the case that we have no duty to allow the state or its agents to commit injustice. We have every right to react with acts of “uncivil disobedience.” We may resist arrest for violation of unjust laws. We may disobey orders, sabotage government property, or reveal classified information. We may deceive ignorant, irrational, or malicious voters. We may even use force in self-defense or to defend others.
The result is a provocative challenge to long-held beliefs about how citizens may respond when government officials behave unjustly or abuse their power.
Food for thought.

December 22, 2018

Welfare State apocalypsis


Too many people argue over the end of the welfare state. There are reasons for concern, but apocalyptic views are unnecessary. A new book reviews the ageing process and the implications for the welfare state. The message is a balanced perspective:
Upon closer inspection, available evidence suggests that caring for a growing older population may not be so costly to finance and that older people provide significant economic and societal benefits, especially when healthy and active:
– Population ageing has a modest and very gradual effect on health expenditure forecasts, compared
to traditional cost drivers such as price growth and technological innovation.
– Demand for long-term care is expected to increase substantially due to population ageing but it is coming from a low baseline currently. However, projected increases in long-term care spending do not account for the economic cost of informal long-term care, as this is not captured in international statistics (nor fully understood).
– Many older people continue to provide paid or unpaid work beyond official retirement age and continue to make a positive economic and societal contribution. The value of unpaid work provided by older people is considerable but not regularly quantified.
– While in Europe older people's consumption is mainly financed by public transfers, many older people pay for (part of) their consumption from private sources, including from incomes from their own continued work or from accumulated assets.
– Accumulation of asset wealth also benefits the economy indirectly through its contribution to productivity growth; health is a key predictor of asset accumulation.
– Older people, even if not in paid employment, continue to pay consumption and other non-labour-related taxes, and thus contribute to public-sector revenues.
 Mostly, I agree with this view. The retirement funding issue is the largest challenge for the welfare state and our politicians are playing with fire.

December 19, 2018

At a glance

Health at a Glance: Europe 2018

Every two years OECD publishes this report for the European Union on the state of health. The new one has an interesting thematic chapter on mental health. It says:
According to the latest IHME estimates, more than one in six people across EU countries (17.3%) had a mental health problem in 2016  – that is, nearly 84 million people.
The most common mental disorder across EU countries is anxiety disorder, with an estimated 25 million people (or 5.4% of the population) living with anxiety disorders, followed by depressive disorders, which affect over 21 million people (or 4.5% of the
population).An estimated 11 million people across EU countries (2.4%) have drug and alcohol use disorders. Severe mental illnesses such as bipolar disorders affect almost 5 million people (1.0% of the population), while schizophrenic disorders affect another estimated 1.5 million people (0.3%).
And the second thematic chapter is about health expenditure: Strategies to reduce wasteful spending: Turning the lens to hospitals and pharmaceuticals. It says:
For hospitals, reducing or eliminating unnecessary investigations and procedures, many of which expose patients to unnecessary risks without the prospect of clinical benefit, is an obvious target for direct intervention. Expanding the use of day surgery can also be instigated at hospital level. However minimising avoidable admissions, particularly for ambulatory care-sensitive conditions, reducing unnecessary length of stay, and improving discharge processes require broader perspectives. Enhanced primary care services, expanded postacute care facilities, post-discharge care coordination, and in home care services all require health system reforms that cannot be initiated by hospitals  alone.
For pharmaceuticals, creating and supporting competitive markets and promoting the uptake of generics and biosimilars can generate substantial savings. That said, reducing waste does not necessarily mean spending less; it may equally be achieved by gaining better value for money from existing expenditure. Both supply and demand side levers offer scope for better value. Using health technology assessment to inform selection, pricing and procurement of new medicines facilitates an understanding of the true opportunity costs of therapies and helps avoid the displacement of high value interventions with ones of lesser value.
This is not new. We have already heard the same for years. Therefore, current inertia is supported by strong incentives that prevent change (either in policy or management). This is the key challenge.

December 16, 2018

Broken markets create broken politics

Monopolies and the Death of Competition

These are some selected key messages from the book:
Capitalism without competition is not capitalism.
Competition matters because it prevents unjust inequality, rather than the transfer of wealth from consumer or supplier to the monopolist. If there is no competition, consumers and workers have less freedom to choose. Competition creates clear price signals in markets, driving supply and demand. It promotes efficiency. Competition creates more choices, more innovation, economic development and growth, and a stronger democracy by dispersing economic power. It promotes individual initiative and freedom. Competition is the essence of capitalism, yet it is dying.
Competition is the basis for evolution. An absence of competition means an absence of evolution, a failure to adapt to new conditions. It threatens our survival. There are fewer winners and many losers when there is less competition. Rising market power by dominant firms has created less competition, lower investment in the real economy, lower productivity, less economic dynamism with fewer startups, higher prices for dominant firms, lower wages and more wealth inequality. The evidence from economic studies is pouring in like a flood.
As you may imagine, what the authors do is precisely to show the evidence of the monopolist and oligopolist activities in the US markets. Our close markets are in the same situation and antitrust authorities are failing to preserve competition. Unfortunately, recent legislation has not helped to reverse the trend. Higly recommendable book.

The author 6 years ago at TV3:

December 15, 2018

Ill-prepared for the arrival of new medicines

Pharmaceutical Innovation and Access to Medicines

While in the last years the number of new drugs in the market has been limited, this trend has changed and countries may expect larger bills in the next future. The OECD report explains the main challenges of pharmaceutical innovation and says:
Despite a slowdown in growth in the 2000s, pharmaceutical spending has nevertheless increased sharply in some therapeutic areas, such as oncology and certain rare diseases where many new medicines target small population groups and command high prices. While these may well address unmet needs, they often have prices that may not be justified by the health benefits they confer.
Countries may be ill-prepared for the arrival of novel medicines targeting wide  population groups. In 2013, the first of a new class of very effective but expensive
drugs known as direct-acting anti-virals (DAAs) for hepatitis C created a shock due to the potential budget impact of treating all infected people. Many countries initially restricted access to the most severely affected patients, creating frustration among patients and clinicians alike. Although subsequent entries of alternative products have created competition on prices and allowed payers to expand eligibility to treatment, the initial shock highlighted the lack of readiness of payers for such events.
In some countries, sudden, large price increases for off-patent medicines have made important treatments unaffordable for patients.
Finally, innovation is lacking in certain areas of high-unmet need, such as new antimicrobials, non-vascular dementia, and some rare diseases.
The report summarises different proposals and measures that would be helpful for a government that cares about citizens' welfare. Unfortunately, this is not our case.

December 12, 2018

The charade of doing well by doing good

Winners Take All

Anand Ghiridhas has done a great job with his new book. He has set up the context for understanding the duality government elites. I've picked only several key statements. The whole book is well written and gives a lot of examples (US-based of course).
Many millions of Americans, on the left and right, feel one thing in common: that the game is rigged against people like them. Perhaps this is why we hear constant condemnation of “the system,” for it is the system that people expect to turn fortuitous developments into societal progress. Instead, the system—in America and around the world—has been organized to siphon the gains from innovation upward, such that the fortunes of the world’s billionaires now grow at more than double the pace of everyone else’s, and the top 10 percent of humanity have come to hold 90 percent of the planet’s wealth.
Some elites faced with this kind of gathering anger have hidden behind walls and gates and on landed estates, emerging only to try to seize even greater political power to protect themselves against the mob. But in recent years a great many fortunate people have also tried something else, something both laudable and self-serving: They have tried to help by taking ownership of the problem.
What is at stake is whether the reform of our common life is led by governments elected by and accountable to the people, or rather by wealthy elites claiming to know our best interests. We must decide whether, in the name of ascendant values such as efficiency and scale, we are willing to allow democratic purpose to be usurped by private actors who often genuinely aspire to improve things but, first things first, seek to protect themselves. Yes, government is dysfunctional at present. But that is all the more reason to treat its repair as our foremost national priority.

December 9, 2018

Claiming for global regulation of genome editing

Genome editing and human reproduction

The Nuffield Council of Bioethics release last July a key document on Bioethics of Genetics. Now that a chinese "scientist" claims to have edited the genomes of twin baby girls is the right moment to read it. And the key principles are:
Principle 1: The welfare of the future person
Gametes or embryos that have been subject to genome editing procedures (or that are derived from cells that have been subject to such procedures) should be used only where the procedure is carried out in a manner and for a purpose that is intended to secure the welfare of and is consistent with the welfare of a person who may be born as a consequence of treatment using those cells.
Principle 2: Social justice and solidarity
The use of gametes or embryos that have been subject to genome editing procedures (or that are derived from cells that have been subject to such procedures) should be permitted only in circumstances in which it cannot reasonably be expected to produce or exacerbate social division or the unmitigated marginalisation or disadvantage of groups within society.
New concerns are arising from CRISPR application and international regulations would be necessary to cope with them. The Association for responsible research and innovation in genome editing is precisely requesting this effort. The only precedents are the Declaration of Human Rights and it seems that it will not be an easy task to fulfill.

PS. Check the former post on Nuffield reports on this topic

December 2, 2018

Ageing policies, a long way ahead


A new book by WHO provides some insights about the impact of ageing. The frame of the message is built around these questions:
1. What are the implications of population ageing for health and long-term care needs and costs?
2. What are the implications of population ageing for paid and unpaid work?
3. What are the implications of population ageing for the acceptability, equity and
effectiveness of financing care and consumption?
4. The policy options: How can decision-makers respond to population ageing?
5. Building on what we know and improving the evidence base for policy-making.
And these are the policies they suggest:
I. Policies to promote healthy and active ageing
II. Policies to promote cost-effective health and long-term care interventions
III. Policies that support paid and unpaid work
IV. Policies to support acceptable, equitable and efficient funding and income transfers
This is just a start. Since ageing is a multidimensional issue, governmental policies should embrace a wider multisector strategy (that the book forgets). There is a long way ahead.

Doctor Prats - Caminem junts

November 23, 2018

Driving evidence-based health policy

Driving Better Health Policy: “It’s the Evidence, Stupid”

Baicker and Chandra are backing an evidence-based health policy. I reviewed it in a previous post. Now the Uwe Reinhardt Memorial Lecture insists on it.
Speaking in favor of evidence-based health policy can be more controversial than one might think. Health policy analysts, health services researchers, and economists in particular often get in trouble by trying to quantify what many hold as unquantifiable and trying to put a price tag on what many think should be priceless.
This is the ouline of the lecture:
Slogans are Not Policies
Differentiating Between Goals and Policies
Evidence is Rarely Straightforward
Fact Patterns Alone Do Not Reveal Policy Effects
Separating Evidence from Preferences
Using Evidence to Inform Policy
And these are the take-away messages:
  • Serious policy assessment requires a detailed description of the policy—slogans are not policies.
  • Clearly articulating and differentiating between goals and policies is crucial to evaluating the most effective way to achieve policy goals.
  • Evidence is often mixed or ambiguous. Researchers should not let their own policy preferences bias their interpretation or synthesis of the evidence. 
  • Evidence does not speak for itself. Researchers need to dedicate effort to timely, accessible, reliable translation.
Agreed. Unfortunately, our close politicians are not interested in evidence if it goes against their ideological criteria. Therefore, claiming evidence for health policy is useless, unless the premise of "politicians will take into account evidence" is really credible. The lecture forgot this "minor" issue, the cognitive biases of health policy.

Josep Segú

November 17, 2018

In favour of positive discrimination for troublemakers

IN DEFENSE OF TROUBLEMAKERS: The Power of Dissent in Life and Business
L'Illusion du consensus

Charlan Nemeth has done a great job explaining the role of dissent in life and organizations. Her last book shows exactly what happens when we emphasize excessively the consensus.
Rather than worry about appeasing others or making sure we do not offend by disagreeing with them, the message of this book is that there is importance and value in authentic debate. The idea that dissent causes irritation and conflict is only partially accurate. Dissent and debate also bring joy and invigorate discussion. Best of all, genuine dissent and debate not only make us think but make us think well. We become free to “know what we know.” We make better decisions, find more creative solutions, and are better able to render justice.
The topic has strong connections with political correctness and hate. The book by Chantal Mouffe addresses this issue with precision.
Afin d’éviter toute confusion, je devrais peut-être préciser que, contrairement à certains penseurs postmodernes qui envisagent un pluralisme sans aucune frontière, je ne crois pas qu’une politique démocratique doive considérer comme légitimes toutes les revendications formulées dans un société donnée. Le pluralisme que je défends exige de discriminer parmi ces demandes celles que l’on peut accepter comme faisant partie du débat démocratique et celles qui doivent en être exclues. Une société démocratique ne peut pas traiter comme des adversaires légitimes ceux qui remettent en question ses institutions de base. L’approche agonistique ne prétend pas englober toutes les différences ni abolir toutes formes d’exclusion. Mais les exclusions sont envisagées en termes politiques et non pas en termes moraux. Certaines revendications se trouvent exclues de fait, non parce qu’elles sont « mauvaises », mais parce qu’elles défient les institutions constitutives de l’association politique démocratique. Entendons-nous bien, la nature des institutions fait aussi partie du débat agonistique, mais pour qu’un tel débat puisse avoir lieu, l’existence d’un espace symbolique partagé est nécessaire. C’est cette idée que j’ai voulu exprimer quand j’ai soutenu, dans le chapitre 1, que la démocratie nécessitait un « consensus conflictuel » : consensus sur les valeurs éthico-politiques de liberté et d’égalité pour tous mais dissensus sur leur interprétation. Il faut par conséquent tracer une ligne de démarcation entre ceux qui rejettent complètement ces valeurs et ceux qui, tout en les acceptant, en défendent des interprétations opposées.
Troublemakers as dissenters in politics are welcome. Though, if they want to undermine democracy, then forget any positive discrimination. This is not their place.

PS. Bad blood wins the Business book of the year contest.

Oriol Romaní

November 16, 2018

"Going Dutch" in regulating the mandatory coverage

Can universal access be achieved in a voluntary private health insurance market? Dutch private insurers caught between competing logics

Healthcare in The Netherlands is widely seen as a benchmark for many scholars. Though it is expensive, it combines mandatory coverage with the choice of private insurance coverage. Sounds of interest, though the devil is in the details.
This article explains the main issues surrounding such model:
The Dutch history of voluntary private health insurance shows both the strengths and weaknesses of public–private health insurance systems, especially in the context of a rising demand for (universal) access to health care. As we have explained, social and private health insurance are based on two divergent logics of different institutional orders (the market and the state).
The Dutch case strongly  suggests that universal access can only be achieved in a competitive individual private health insurance market if this market is effectively regulated. The tension between adverse selection and universal access that had vexed the Dutch private health insurance industry throughout its existence was resolved by combining elements from both the insurance logic and the welfare state logic: i.e. an individual mandate, guaranteed issue, community-rated premiums, income-related subsidies and a sophisticated risk equalization scheme .
Achieving universal access in a competitive private health insurance market is institutionally complex and requires broad political and societal support.
Therefore, unless there is a smart regulator, forget it...

PS. Spanish embroglio at Marginal revolution.

PS. How is Obamacare doing?

From Lisa Eckdahl latest album

November 14, 2018

Provider payment strategies to improve health

Value-based provider payment: towards a theoretically preferred design

The case for improving health is related, among many things, with the incentive structure of the whole system (people, professionals and providers). If we focus our aim towards providers, then we need to reassess current flaws in the system, and ask what do we have to do. A new article tries to address these issues.
In order to tackle the problems related to current payment methods, worldwide, policymakers and purchasers of care are exploring alternative payment strategies to help steering health care systems towards value . A well-known endeavour in this regard is pay-for-performance (P4P), in which providers are explicitly rewarded for ‘doing a better job’. Although P4P is an appealing idea, explicit financial incentives for value should in principle be used only modestly in provider payment methods because of the multitasking problem. Therefore, it is not surprising that in practice, the majority of provider revenues (typically referred to as the base payment) is not explicitly linked to value. This base payment, however, does create implicit (dis)incentives for value, because each payment method influences providers’ behaviour through incentives.
The article reflects a conceptual framework of key components and design features of a theoretically preferred Value Based Payment method. And the key message is:
We conclude that value is ideally conceptualised as a multifaceted concept, comprising not only high quality of care at the lowest possible costs but also efficient cooperation, innovation and health promotion. Second, starting from these value dimensions, we derived various design features of a theoretically preferred VBP model. We conclude that in order to stimulate value in a broad sense, the payment should consist of two main components that must be carefully designed. The first component is a risk-adjusted global base payment with risk-sharing elements paid to a multidisciplinary provider group for the provision of (virtually) the full continuum of care to a certain population. The second component is a relatively low-powered variable payment that explicitly rewards aspects of value that can be adequately measured.
I fully agree with what they say. Close politicians and officials should take this message into consideration regarding the next primary care physicians' strike, and forget the current confusing approach.

Norman Rockwell 
Estimate $5,000,000 — 7,000,000
(It may be yours, upcoming auction at Sotheby's)

November 11, 2018

Living with dementia

Care Needed. Improving the lives of people with dementia

Across the OECD, nearly 19 million people are living with dementia. Millions of family members and friends provide care and support to loved ones with dementia throughout their lives. Until a cure or disease-modifying treatment for dementia is developed, the progress of the disease cannot be stopped. 
We all know cases of close relatives with dementia, and we understand the suffering that surrounds the disease. OECD has made a good job coping with this difficult topic.
These are the three key chapters:

  • Identifying people with dementia 
  • Helping people with dementia live well in the community 
  • Health and long-term care services for advanced dementia are poor

As people live at home longer, communities need to be better equipped to meet the needs
of people living with dementia. Post-diagnostic care pathways can help connect people with dementia and their families with available services. But communities themselves must also adapt: community-friendly initiatives that train local populations and businesses to respond more effectively to people with dementia can help to reduce stigma around dementia while making the environment safer and more welcoming. Aging at home also means that informal carers will play an important role in supporting people with dementia. Informal carers should receive the support they need, and governments should assess whether existing services for carers are also adequate for carers of people with dementia, who may have unique needs.
Definitely, every country needs to develop a strategy for this disease. Catalonia has already defined its strategy, though resources are not enough.

Jaume Plensa at Madison Square Park