Measuring Health Care Effectiveness
By Arnold Kling
Co-blogger Bryan and I have been arguing over two issues, one substantive and one methodological
Substantive issue: I say that health care probably is effective. He says that there is no evidence that it is effective on average. Incidentally, Paul Krugman says that there is no evidence that U.S. health care is effective at the margin, meaning that the additional money that we spend on health care relative to other countries does not lead to measurably better health outcomes.
Methodological issue: I say that looking at aggregate data on health care outcomes is lazy econometrics. There is no substitute, I argue, for careful disaggregated studies.
Now, in response to my post on Murphy and Topel’s article about the huge benefits of health care, Bryan is sticking to his substantive position, but reversing himself on methodology. That is, he remains skeptical that health care provides benefits. Now, he argues that Murphy and Topel are failing to control for other factors that affect health.
Murphy and Topel find that longevity after age 60 has increased since 1970, with much of the improvement coming in the form of fewer deaths among males from heart disease. But can we conclude that this reflects better health care? Might this reflect other factors, such as reduced pollution, less physically-demanding jobs, and earlier retirement? Murphy and Topel glide past this question.
I am more than willing to concede the substantive point that Murphy and Topel have failed to provide conclusive evidence of the benefits of health care. However, I claim progress on the methodological point that the question needs to be settled by careful, disaggregated analysis rather than lazy macro statistics.