Taking a break from life in riot-torn London, I came across this item at the FT about some of the implications of longer lifespans. It is a mixed situation. Excerpt:
“Maxmin admits there are no miraculous solutions to the problems of a fast-ageing society. We will all have to work longer, save more and pay more in tax to cover the costs of a world with a greyer population. Even so, he thinks models like Elder Power can have a much wider application. Perhaps moments like the collapse of Southern Cross, he tells me, could (in the right hands) become moments of opportunity. More generally, models like Beacon Hill Village, ITNAmerica and Elder Power show glimpses of a future in which more elderly people can stay in their homes for longer. All three use innovative technology, make use of assets in their local community and bring together the resources of local businesses, volunteers and the state to solve problems none could have solved individually, at reasonable cost.”
How we deal with ageing, and the issue of longer lifespans, is of course intertwined with the current fiscal breakdown of many developed economies. Healthcare costs are skyrocketing. And in that Greg Lindsay and John Kasarda book I have been linking to lately, about the impact of mass aviation, there is a segment on how said aviation can be used to dramatically reshape healthcare, such as by flying people with problems to cheaper, but arguably better run, hospitals in Asia. It struck me while reading this book that while automobiles and consumer electronics have been propelled by their Henry Fords, Michael Dells and Steve Jobses, we haven’t really had, in healthcare, a similar set of individuals to drive innovation and push things sharply down the price curve. The dynamics of Silicon Valley, allied with cheap Chinese manufacturing and just-in-time stock inventory systems, hardly touches healthcare at all, although this is starting to change, perhaps. Of course, much of this is caused by how healthcare is seen, wrongly in my view, as somehow “different” from such vulgar things as selling flatscreen TVs or cars. Healthcare is political. That’s the problem.
I have a friend in the Police force who will retire at 54 after 30 years service and be given an index linked final salary pension for what could be 10 or even 20 more years than he actually worked for. Bargain.
Have a gander at ‘Baumol’s Cost Disease’. Technology isn’t mature enough, so you you still need a lot of labour, and total factor productivity growth stagnates. If we get full-on robot nurses and doctors, then maybe…
We will all have to work longer, save more and pay more in tax to cover the costs of a world with a greyer population.
“We”, bwana?
If they’re living longer and are healthier, they can also support themselves longer.
On topic of the post itself, well, I think healthcare is different from those examples in a meaningful sense, even beyond the massive distortions created by politics.
The main way it’s different is that healthcare provision is not primarily “making widgets and selling them”. It’s heavily service-based – and for that matter, the really expensive widgets seem to come in two classes:
Things like CAT and PET scanners and proton accelerators and the like, which are fabulously complex and big and not produced in quantities of thousands a day (or indeed, a year).
And things like new drugs, which are expensive because so many of them don’t work at all (and because of enormously expensive state-mandated testing procedures… though even without the State requiring it, there’d still have to be a lot of expensive testing in practice).
It really is different… because it’s not just mass-production of some mass-market good that’s only different incrementally or in packaging from others that are well-understood.
(In places where it is just mass production, like making a commonplace generic drug with great demand, we have seen precisely the sort of price drops that mass production provides…)
no most medicine is information processing. the docs do a lot of testing before doing procedures or prescribing medicine. if this particular industry was freed of the present constraint i would venture that people in that industry would revolutionize the whole thing. want an example google lasik surgery.
That might be true, but you need a rather sophisticated software package to make doctor-type decisions. Even with that, you still need a nurse-type person to gather the information.
Robonurses and Robodocs would cut the price, but we’re a ways off from that. In the meantime, we have a labor-intensive health services industry which is hard to streamline; when we do, we feel like we’re cattle in the doctor’s office rather than people.
and consumer electronics have been propelled by their Henry Fords, Michael Dells and Steve Jobses
O/T but personally I would not include Jobs with Ford or Dell, all Jobs has ever done is put other people’s innovations into shiny expensive packages, whereas Ford and Dell streamlined the manufacturing to customer process. Unless you are referring to marketing as a propellant, Jobs does not deserve to be in that league.