January 28, 2006
Prescription For Failure
Here's a math question about a household budget. Say you want to understand the effect of trend lines comparing household income to a single item of household expense. That expense might be food or clothing or heat.... or, in this case, interest payments on debt. Here's the question:
What happens if household income is rising at the rate of six-tenths of 1% per year and interest payments on debt are rising 8.5% per year?
Answer: The share of income eaten up by interest payments is metasticizing like a cancer.
Now, if your income is $1 million per year and the base line interest payments are even $40,000 a year, this trend is not particularly troubling.
But, what if you are a doctor and your income is $150,000 per year while the base line interest payments from medical school and other debt are $30,000 per year? Well, then your household income is in cancer-like territory because a year from now your income will be $150,000 times 1.006, or $150,900 but your interest payments will be $30,000 times 1.085, or $32, 550 -- a net problem (before taxes) of $1,650 of more expenses than income.
Five years later, this net problem grows to slightly more than $8,000. $8,000 that the doctor needs to find from other household expenses -- or to offset with income from a second job (or, perhaps by agreeing to participate in income-generating programs offered by pharmaceutical companies). That's a cancer.
And, those are the trends lines currently describing average doctor income and average doctor indebtedness. Average. Therein lies this not-so-hidden prescription for the failure of our society's health care (at least if by 'society' we mean 'liberty and justice for all' -- for 100% of society instead of just part of society):
You are going through medical school looking at these trend lines and you have this choice -- you can sign up to be, say, a pediatrician who works with kids from all parts of society (top to bottom) at an income below the the average, or you can put yourself in a bit more debt to become a specialist focusing on the top 20% of society who have 80% of the nation's assets and, through both insurance and private means, can afford to pay bills that permit your income to be 6 to 8 times the average.
You can put yourself and your family in the position of the $1 million household with beginning debt of $40,000 -- or you can put condemn your family budget to a metasticizing cancer.
You can choose to participate in a health care system that serves the top 20% -- or you can choose justice and fairness for all.
Given our culture's sociopathological obsession with value and individualism, what's your bet on the pattern of choices made?