Walter E. Williams

"The Dog and His Bone" is one of Aesop's many instructive fables. It's about a dog carrying a bone in his mouth. As he was crossing a footbridge over a stream and happened to glance into the water, he saw his own reflection. Thinking it was another dog with a bigger bone, the greedy dog growled and said to himself, "I'll get that bone, too." When he opened his mouth to take the bone, his own bone fell into the water, never to be seen again.
 
You say, "Williams, that's a nice story, but what's the relevance?" Its relevance has to do with the myths and some of the discussion about what to do about our health-care problems. The recently published "Miracle Cure," by Sally Pipes, president of the San Francisco-based Pacific Research Institute, exposes health-care myths while explaining why the sometimes-touted Canadian style health care isn't the answer. Myth: Uninsured individuals have no access to medical care. Fact: It turns out that in 2004 uninsured Americans received $125 billion of health care, of which $41 billion was provided totally free of charge.

 Myth: Skyrocketing prescription drugs are driving health-care spending up. Fact: According to the Bureau of Labor Statistics, as a whole, Americans spend about 1 percent of their income on drugs. Seniors spend about 3 percent on drugs, less than the amount they spend on entertainment. Spending on drugs, as a percent of total health-care spending, was 10 percent in 1960. It's roughly the same today.

 The fact of business is, pharmaceutical spending actually lowers total health-care spending. It often replaces expensive and invasive surgical procedures and the time spent in the hospital. For example, in a yearlong disease-management program, Humana Hospitals studied 1,100 congestive heart failure patients. While pharmaceutical costs increased by 60 percent, the medications reduced hospital costs by 78 percent -- a net savings of $9 million.


Walter E. Williams

Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of 'Race and Economics: How Much Can Be Blamed on Discrimination?' and 'Up from the Projects: An Autobiography.'
 
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