Genetic screening equals public health care

In a number of areas of health care, the rapid advance of technology may pose challenges to public systems, as technology tends to increase to costs associated with care by expanding both the realm of the possible and the number of people who can avail themselves of it (I review some cases of this in a CCPA paper). I argue that a public system is a better way of managing such stresses in an equitable and effective manner, but that this requires evidence about outcomes, and a broader public discourse on what should be covered by public insurance.
In an interesting twist on technology in health care, Stephen Cecchetti of Brandeis University argues that the advent of genetic screening technology will undermine the basis of private health insurance and lead to the triumph of a single-payer, publicly funded model (in the US):

A single-payer, publicly run, health-care system is the inevitable consequence of the nearly continuous scientific revolution in molecular genetics that began a half century ago. The time is fast approaching when we will have an inexpensive test that is capable of revealing a person’s genetic propensity to contract a broad array of chronic diseases.  That means that we will be able to accurately assess the cost of medical treatment over their lifetime.

The fact that we will all have health scores has profound implication for insurance; or, more accurately, for the failure of market-based insurance. If I have the information revealing that I am likely to be healthy, living a long and low-medical-care-cost life, this knowledge alone will create adverse selection, causing me to forgo insurance for everything except treatments arising from accidents, which can never be forecasted.

[I]f my insurance company can obtain my health score, then, in the same way that lenders use my credit score to calibrate the interest rate they offer on a loan, they will adjust my health insurance premium based on their precise estimate of the cost of my future medical care. And, importantly, a clever insurance company that is precluded from learning my health score directly will find a pricing scheme that leads me to reveal it to them through the choices that I make.

The fact that private insurers can accurately compute customer premiums to reflect expected future payouts means that the insurance market will break down. Insurance is about shifting risk, pooling large groups of undifferentiated individuals.  When either the insurer or the insured can forecast future events, and accurately distinguish one person from another, the rationale for insurance disappears.

[A]t the same time … the social pressure to provide equal access to care will remain. This makes it inevitable that health care systems everywhere will provide universal coverage and be publicly run.  Governments will replace markets, insuring that the poor and uninsurable receive medical treatment at the same time that the healthy are forced to participate in a comprehensive system.

Unfortunately, we will be forced to restrict access to the most expensive treatments, but even so, everyone is going to receive adequate health care. The operation replacing my disintegrating brain and over-worked liver with the new ones grown from my skin cells may not be covered; but then again, maybe it will.

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