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Email L. Henry Platt, Jr.
  Henry Platt


In a June, 2009 Opinion published in THE WALL STREET JOURNAL the CEO of Safeway described the way his company has held the line on health care costs and the success of the plan. The state of Washington has been considering defining levels of care and subsidizing many of the basic health care needs. The state of Connecticut provides means tested health care for everyone who cannot afford to pay for care. The commonwealth of Massachusetts has enacted a program that requires everyone to purchase healthcare insurance.

Health Care insurance is wonderful in New Haven, Connecticut or Boston, Massachusetts if you have the $25 to $100 copay. Then again, if you are ranch hand fifteen miles north of Scott City, Kansas; you might be hours away from the treatment you need even if you have the best insurance available. This is just one reason why Health Care should be controlled by the States instead of the Federal Government. Remember, Thousands more go to New Haven, Boston, or Mumbai (formerly Bombay) than Scott City.

When Calvin Coolidge had just become President of the United States, my father, his sister, brother, mother, and father would sit around the kitchen table to listen quietly to the radio head phones placed in a large bowl for all of them to hear the low volume produced by the crystal set. Today anybody with the same three hours' wages can buy a fashionable radio with plenty of volume to fill a large room. Technology and invention have given us much better radios at a lower cost.

When Grover Cleveland was President, my fourth cousin, Lucien, died of cystic fibrosis. When Ronald Reagan was President, my daughter, Abby, died of cystic fibrosis. Abby lived a dozen more years than cousin Lucien, but to treat her, many thousands of dollars more were spent for modern medicine, which did not even exist when Grover Cleveland was President.

These seemingly unrelated observations are presented to reveal the differences between costs of production of real things like televisions and dairy products and the costs of services like haircuts and health care! Products can be built more efficiently to provide much greater value, but services are expanded to include more detail which increases price.

At Christmastime in 1920 the New York Times advertised electric record players starting at $450. Today, recorded music players can be purchased for less than 10% of that amount. In 1953 I spent three weeks in the hospital following an automobile collision. I was semiconscious for ten days, I had private duty nursing for the first two weeks, I was given a few x-rays, and I was given a daily injection of penicillin. By today's standards my care was grossly incomplete!

The record of my stay in the hospital explains why today's costs are so much higher: modern equipment, far more specialized equipment, greater training requirements for doctors, nurses, and many other skilled and semi-skilled hospital workers. Compared to when I was hospitalized in 1953, many of those patients today would be out patients or would be treated in assisted living facilities at significantly lower cost.

Every year medical knowledge moves forward. Every year doctors, nurses, and the rest of the staff need to consider more and more options in the latest, the best, and the best available treatments for the patient. Sometimes the latest drug or procedure may not be the best for an individual, but other circumstances may allow for less than the best. The most expensive treatment is not always the best, and the more a person knows about illnesses and treatment, the better the treatment.

In the world businessmen and workers can only flourish when there is a market for what they can produce and market. In medicine individuals and companies spend far more effort trying to find a new drug to treat tennis elbow than gout. Sufferers of tennis elbow are usually members of a more affluent group than sufferers of gout, and since the tennis elbow group has more money, it is more profitable to find new treatments for tennis elbow.

The previous paragraph does not sound promising for ORPHAN DISEASES, but it does begin to explain the rapid escalation of health care costs: More Options, More Treatments, Higher Costs!

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© L. Henry Platt, Jr.