The wizards of American medicine

February 11, 2010

On January 28 in The Wall Street Journal, Daniel Henninger explains how attempts to *reform* America’s health care industry in a top-down fashion inevitably fail due to “unimaginable complexity.”  Henninger chooses the medical devices industry to illustrate his point, and cites Massachusetts as an example – but one could easily substitute Florida and its 92 companies (and approximately 4000 jobs).

According to data compiled by Hoover’s business research from the U.S. Census, the health-care industry consists of 340,650 separate establishments employing 5,508,926 people. I leave it to a mathematician to calculate the number of possible economic relationships this would produce every day, much less annually.

the-clinic-of-dr-gross

…One of the jewels of this collection of professionals, which the politicians say is “failing” us, is the U.S. medical-device industry. It has come a long way since the days of “The Clinic of Dr. Gross” in Thomas Eakins’s famous painting.

There are 8,616 separate medical-device companies in the U.S., employing 359,065 people. Within the device industry, its two largest categories are electronic and precision equipment and surgical appliances. These are the wizards of American medicine.

The president says the special interests oppose his bill. But to pay for the bill, Congress would levy a $2 billion annual tax on the medical-device industry, which ardently opposes the legislation.

Let’s pick a state. How about suddenly famous Massachusetts. The Massachusetts Medical Device Industry Council lists more than 220 companies as primary members. They have weird names like Aeris, ExtruMed, Bioxcell and WunderThink. Yet the Democrats are agog that Massachusetts voted Scott Brown into the Senate.

Harvard Medical School Dean Jeffrey Flier said of the health-care bill in these pages recently that “our capacity to innovate and develop new therapies would suffer most of all.” And that’s the high-minded criticism of the bill. Down at the level of simple retail politics what you see are tens of thousands of separate health and medical interests that understandably are in motion because of this bill’s determination to change everything in American health care.

The president and his health-care advisers are giving philosopher kings a bad name. Only people who have reduced American health care to rows and columns of data in academic studies would think it possible to remake this incredibly sophisticated organism as easily as rebooting a spreadsheet.

You can’t do it.

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