A heartfelt Analysis

A hearty bibliography
A heartfelt letter

At the end of the second post of this series, I ‘absolved’ my doctors from responsibility. How arrogant of me! How do I dare to imply that they were responsible to begin with? Didn’t they just save my life? But if they are not responsible, then who is? I called my doctors the product of the system, but what does that mean? What is the system? What defines it as a ‘system’?  

I have a reoccurring disagreement with a close friend who likes to say that ‘system’ we have is the one we wanted. If we didn’t, we would have created a different one. We have only ourselves to blame. I keep countering her with the argument that once created, systems develop a life of their own and can easily end up in a way that nobody really wanted. The task therefore is to understand how systems work.
What creates them, what is the intent/interest behind their creation, what are their problems and what creates those problems. What are the unintended consequences and what are the incentives perverting the original design.

My assertion is simple: Our health care systems (both Canadian and American) are fundamentally flawed and cannot be fixed with simple tinkering. The problems are intellectual property rights, the distortion of market signals, heavy handed regulations and various state sanctioned monopolies.

But before I dive into the analysis of the root causes, let me start with answering my question.
Who is responsible? I, of course. My health is, or at least should be, my responsibility. I am responsible for my lifestyle, my fitness, my diet or any self-inflicted abuse of my body or mind. I am, in a way, also responsible, or at least should be, for my own fate: the genes and defects I was born with and even the misfortunes that may befall on me. I say I should be, but I am not. I CANNOT. The state does not allow me to be. My choice of doctors is limited. I cannot seek doctors outside the system because I am not allowed to even know about their existence. My access to medical knowledge is heavily censored. My choice of possible treatments is limited. The choice of the drugs I may take is severely limited. In Canada, I cannot even pay for my own treatment. I am not even allowed to know how much any of my treatments cost or how much the system spent on me in total.
Considering these limitations, assigning some blame to the systems and processes that created them isn’t exactly misplaced. The problems are many.

The greatest is the elimination of the market signals, either through an outright socialist system as in Canada or through government regulated insurance monopolies as in the US. In this post I will focus on the institutional problems: the medical establishment, the regulatory agencies and their unholy alliance with the drug industry.

The Pharmocracy

I don’t know how much I could possibly add to the books and documentaries on the subject to illustrate the crimes of the pharmaceutical industry.

John Oliver’s skit may be funny, but the books of William Faloon and Kaushik Sunder Rajan (both titled ‘Pharmocracy’) or the two documentaries of Gary Null (“Death by Medicine” and “War on Health”) are not.
They all describe the problem quite extensively. A chapter title in Barbara H. Robert’s book sums it up quite well: “Big Pharma, the FDA, and the Medical Profession: An Unholy, Very Lucrative Alliance”

Pharmaceutical companies are corrupt and corrupting, but not because they are evil. They just act in their own self interest and respond to incentives WE created for them.
Their interest is not to get you healthy. Their primary interest is to make money. If you are healthy, they don’t make any money. If somebody else makes you healthy, they don’t make any money.

They can only make money if you have long-term dependence on their product
…which is why they are not interested in cures, only in managing conditions.

They can only make money if that product is patentable
… which is why they not only ignore, but actively suppress research into natural cures, alternative medicine and prevention.

They can only make money if they can entice doctors to prescribe their products
… which is why they are spending billions every year on bribing doctors in various ways

They can only make money if they control the regulatory and approval process
… which is why there is a revolving door between the industry and regulatory agencies.
For all intent and purpose, the FDA has been taken over by the industry.
This relationship is especially insidious. It’s not just control, it is protection as well, since by the approval, the agency assumes some responsibility for the safety of the approved drug. Their relationship should be adversarial while in reality it’s anything but.

They can only make money if they can control the clinical research projects
…which is why they have practically taken over the financing of medical research.
“ Increasingly, industry is setting the research agenda in academic centers, and that agenda has more to do with industry’s mission than with the mission of the academy.” (Boston Review)

They can only make money if they can control the education of doctors
…which is why: “The pharmaceutical industry devotes much, if not most, of its vast marketing budget to what it calls the “education” of doctors.” (Boston Review)

They can only make money if they control the scientific literature
…which is why they are paying big bucks to editors of supposedly independent medical journals (the numbers will shock you).

I have to stop here to make something clear: There is absolutely nothing wrong with making money, but (following the list above) everything is wrong with: keeping you sick, preventing others from offering you alternatives, bribing doctors to recommend their products, hijacking regulatory agencies, corrupting and controlling scientific research, publications and medical education to serve their own financial interests.

Pharmaceutical companies cheat, lie, bribe and corrupt; ignore and cover up the harm they do as a routine part of their operations. The industry is paying out billions every year in penalties and settlements for their wrongdoings. They see the penalties (pennies on the dollar) as the cost of doing business.
And they are doing it because
We created a system that is corruptible.
We created the system of prescription drugs.
We created the system in where only licensed doctors have the right to say what kind of medication you can take.
We created the approval system, where the industry is protected from foreign competition.
We created the system protecting the industry from ANY kind of competition, including nature.
We created the system where talking about the healing properties of natural products is criminalized.
We created the system where it takes hundreds of millions of dollars to approve a new drug.
We created the corruptible patent protection system.

The pharmaceutical industry does what any other would in a system of cronyism: It uses favourable regulations to clobber its competition with it, while it does anything it can to corrupt and evade the ones that were designed to control it.

Agencies such as the FDA do not make drugs any safer. Not just because the industry can corrupt and hijack the system, but because it defuses and deflects responsibility. Once a government agency ‘approves’ a drug, it takes responsibility for its safety. Without the FDA, drug companies would have to bear full criminal and civil liability for the products they sell.

Big Pharma is the intermediate cause of our problems. The root causes are socialized health care, medical licensing and regulations. Without those, ‘big’ powerful pharma would be small and powerless.

The agencies and socialized medicine

The pharmaceutical industry is regulated. The regulating agencies have been hijacked by the industry, but that does not change the fact that the industry can claim that they are regulated. Health care services are also regulated. They are mostly ‘soft’ regulations in the form of guidelines and recommendations but they are quite onerous. To a considerable extent, they are used as cost control tools.

The biggest problem of socialized medicine is the basic problem of any socialized enterprise: the distortion or outright elimination of price signals.

Central planners can never know what is really needed or wanted. They also don’t know the actual value of anything they have to offer. Without price signals, they cannot make good decisions. There is a potentially infinite demand for services that are free. Price is an essential mechanism of information, prioritizing and decision making. In the name of fairness, justice and ‘equality’, socialists are eliminating the only tool that could keep the system rational. As it is, I have no way of knowing the cost of my health care.

Once the price signal is gone, everything is politics. Satisfying the infinite demand for the services on one hand while controlling costs on the other. It always plays out the same way. Limiting the availability of existing services, simply not allowing new ones, limiting the number of doctors, limiting their access to the tools to work with, limiting access to certain drugs and new procedures and so on.

Socialized services have an inevitable trajectory of degradation, the best example being the NHS in Great Britain. Declining services, increasing wait times, uncontrollable costs.

The medical establishment

I have seriously mixed feelings about doctors. Let me explain.

At the time A. J. Cronin wrote his books, doctors still functioned as independent professionals. They finished their education then hung up a sign on the door of their office to offer their services. They were paid for those services by the people they helped. Some doctors worked for private hospitals where they still functioned as independent professionals owing allegiance only to themselves, their patients and their Hippocratic oath. I think most doctors would still want to see themselves that way.

But it is different today, especially in places of socialised medicine such as Canada a country with a single-payer system. Patients don’t pay for medical services, the government does, and as we know, he who pays the piper calls the tune.
Doctors have three masters: licensing authorities such as various colleges of physicians; paymasters, such as either government or private health insurance organizations and labour unions such as medical associations.
We could say that doctors working in hospitals have a fourth master, but hospitals are just another layer of the system. What matters is who allows doctors to work, who pays them and who represents their interests vis-à-vis those two.
We could also call the body of regulations, guidelines and standards another master, but they are articulated and enforced by the above-named institutions.

A major impetus of any centralised and hierarchical organization is the creation of standards, structures and predictability. They can only achieve that through the elimination of spontaneity, irregularities, individualism and creativity. Centralized, hierarchical organizations have difficulties handling dissent and they change very, very slowly.

The source of my mixed feelings is seeing doctors as living between two worlds not really knowing where to belong. On the one hand, they are healers, on the other they are just little powerless clogs in a gargantuan machinery. They are controlled by the rules and expectations of the system that makes their livelihood possible.

I want to trust my doctors, but I am fully aware that they are NOT working for me, that their primary allegiance is to their masters and their agendas. How could it be otherwise? I am NOT the one paying them. It is said, that “When something online is free, you’re not the customer, you’re the product.”
I can ask, how is this relationship different?  I am thinking like a Canadian here, but it isn’t much better in the US. The heavily regulated insurance companies are not very different and at times can be even more oppressive than government institutions.

Medical associations are more concerned with representing the interests of their members against the decisions of their paymasters than they could ever be with their members’ relationship with their patients.
Like with any other labour union whose members interact with people, the ‘interest of the patients’ is just the excuse for their demands.

The goal of medical schools is to train doctors for the system as it is. To respect collective wisdom, to follow the rules, guidelines and recommendations. To fit in. To conform. To live within the consensus. Not to bite the hand that feeds them.

In many ways, I feel sorry for the doctors. It must be difficult to live with the conflicting pressures.
Living between the desire to be a healer and conforming with the expectations of the system. On the top of which there is the tremendous moral responsibility which is ultimately theirs. Not the system’s.
Some doctors can’t handle it: they leave the profession or commit suicide.
I personally know a few family physicians who left their practice to start some sort of alternative medicine/wellness business to be free from the system.

Doctors commit suicide at a much higher rate than the general population. It would be arrogant to blame it all on the system, but it would also be stupid to think that the nature of the system as described above has nothing to do with it.

Doctors are both beneficiaries and victims of the system. Which one any doctor is more likely to be depends on their integrity, honesty and their ability to deal with the pressure of the stressful and frustrating system.

The trap with socialized services is the fact that more politics can only make them worse. There is no fix for systemic problems without the dismantling of the system. Spending more money on it is just a temporary reprieve.

In my next post I will try to imagine a system I would like to live with.


This post is part of a series about health care.
You can find the rest here:

A heartfelt story  – the personal aspects of the story
Some heartfelt discoveries    – what I learned once I looked into it
A hearty bibliography  – A seemingly unending list of references to those discoveries
A heartfelt analysis   – A critical exposé of the root causes of the problem
My heartfelt wishes   – A libertarian answer to the problems
A heartfelt letter   – A letter of frustration with a libertarian message
Healthy thoughts   – Final thoughts and a the personal aspects of the story

2 replies on “A heartfelt Analysis”

  1. Thanks so much for tackling the healthcare system, Zork!

    You’ve fingered a number of the crucial points, for sure. I haven’t had a chance to read all your posts, but look forward to it as I catch up from having left the post of President at one of the associations you mention. 😉

    The only point I’d quibble with is this: any organization is a snapshot of the people in the organization at that time. This makes if very hard to form generalizations. Especially with medical associations, the culture and character can change 180 degrees over a few years.

    Again, thanks so much for digging into this! Great to hear that you pulled through and are doing well.

    Best regards,



    • zgh says:

      That’s very true. The atitudes of German and French labour unions are quite different as well. 
      Still, there are incentives and there is the system. I hope I will make things a little more clear in my next post.

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