Uwe Reinhardt’s ‘Priced Out’ offers lessons in health care costs for all

I had the pleasure — and the misfortune — of publishing several articles with Uwe Reinhardt, the legendary Princeton economist who died in 2017 as a very young 80-year-old.

The pleasure was that Uwe was a great co-author with amazing insights. His ability to present complex ideas in an accessible way will be clear if you read his just-published final book, “Priced Out,” which explores the economic and ethical costs of health care in the U.S.

The misfortune occurred whenever I used the paper we had written together to give a talk: Uwe’s were always funnier and had more insight than mine.

While working with Uwe, I learned that he kept three audiences in mind. The first was students; they were perhaps his primary audience. This book is entirely appropriate for undergraduate or graduate students interested in how our health system operates.

His second audience was policy makers and the media. Uwe spoke about topics that were on everyone’s mind and almost always provided memorable one liners. “Priced Out” explores the underpinnings of our health care system and identifies the values that form its foundation.

His third audience is everyone engaged in delivering health care. The book illustrates Uwe’s ability to take on powerful interests and have them accept his humorous critique of their actions.

Students will benefit from the first chapter, which offers a primer on factors that explain why the U.S. has greater spending on health care than any other industrialized country (with poorer outcomes) and then discusses how these high prices affect the average patient. The third chapter, “Some Interesting or Curious Facts about Our Health Care System,” is classic Uwe relating to students. He begins with a joke that I can see him telling during a presentation: “According to a cosmic law whose discovery I attribute the legendary Harvard professor Alfred E. Neuman: Every dollar health spending = Someone’s health-care income.” The reference may be to Mad magazine, but the sentiment is serious and explains why it is so difficult to control health spending.

The book then goes on to address the debate over whether more jobs in the health care sector will be good or bad for the economy. After presenting all perspectives on the issue, Uwe concludes, “Collectively as a profession, economists probably do not have a clue on how many jobs particular health reform proposals create or destroy.” No one, including his fellow economists, were immune from his critique.

Over the course of Uwe’s career, policymakers and the media benefited from his insights. Here he takes on the controversy over a possible shift to a single-payer system, sometimes called “Medicare for All.” In the chapter titled “Who Actually Pays for Health Care,” he notes that roughly half of all U.S. health spending is currently done through government budgets: Medicare, Medicaid, Tricare and Veterans Affairs for the military, and public health. To answer the rhetorical question “Is a single-payer health insurance system un-American?” he points out that Medicare is a classic single-payer system and that the military and veterans operate under a system where financing and delivery are operated by the government. If single-payer systems are acceptable for the military and veterans, Uwe argues, why shouldn’t they be acceptable for the rest of us?

To cement the point, he notes that health care spending in the private sector has increased faster than in the public sector, so why would policy makers believe that public spending is unsustainable but private spending is sustainable.

The chapters on ethics are directed primarily at the health care establishment. According to Uwe, “American progressives” believe that health care is a social good, while others believe that health care is a private consumption good. He argues that many of the debates over issues like the Affordable Care Act are really debates over ethics, and that while we prefer to debate proposed health reforms mainly in terms of technical parameters, “our arguments always have been, are now, and will continue forever to be over the elephant in the room no one likes to mention, namely, the fundamental question, to what extent we should be our poor and sick brothers’ and sisters’ keeper in health care.”

Uwe’s book can be enjoyed by, and be illuminating for, students, policymakers, the media, and the health care establishment. The only problem is that he can’t follow it up with a book tour and educate his audiences in person with the best PowerPoint presentations I have ever seen.

Gerard Anderson, Ph.D., is professor of health policy and management at the Johns Hopkins Bloomberg School of Public Health and director of its Center for Hospital Finance and Management.