How Much Will Your Life Be Worth Under Obamacare?

Verne Strickland / Blogmaster / October 5, 2013

(Image credit: AFP/Getty Images via @daylife

Economy Paul Hsieh Contributor 

How much will your life be worth to the federal government under ObamaCare? Less than you might think. We can make an educated guess by looking at which medical screening tests the government U.S. Preventive Services Task Force (USPSTF) considers worthwhile.
The USPSTF made headlines a few years ago when it recommended against annual screening mammograms for women age 40-49 (but rather starting at age 50). This was a departure from long-standing guidelines from the American Cancer Society and the American College of Radiology recommending mammography beginning at age 40.

Under ObamaCare, Medicare and private insurers will be required to cover preventive services with a USPSTF “A” or “B” rating, but not those with lower ratings. Hence, the USPSTF recommendations are not just academic — they will have real teeth.
With respect to breast cancer, the USPSTF argued that the risk of cancer for women age 40-49 was too small to justify routine screening, using “the number needed to screen to save one life” as a key metric.
As the American Cancer Society observed,

The USPSTF says that screening 1,339 women in their 50s to save one life makes screening worthwhile in that age group. Yet USPSTF also says screening 1,904 women ages 40 to 49 in order to save one life is not worthwhile… With its new recommendations, the USPSTF is essentially telling women that mammography at age 40 to 49 saves lives; just not enough of them.

Although the USPSTF does not directly consider the costs of screening tests when formulating its recommendations, those recommendations can also be analyzed in economic terms. The average cost of a mammogram is roughly $100. Hence, the federal government considers it appropriate to spend $134,000 on screening mammography to save a single woman — but not $190,000. So in a sense, this is a measure of the price the government is setting on her life. (Under pressure, Secretary of Health Sebelius later backpedalled from those guidelines, declaring them non-binding.)
What about men’s lives? The USPSTF has given a “D” rating (“not recommended”) for prostate cancer screening with the PSA blood test, arguing insufficient benefit. According to the Mayo Clinic, a major study showed that, “to save one life after eight years, nearly 1,400 men needed to be screened.” A PSA test costs roughly $60 – $80. Assuming a screening interval of 4 years, this means that the government recommends against spending $168,000 – $224,000 on PSA testing to save the life of one man.
More recently, the USPSTF approved low dose screening CT scans for detecting early lung cancer in smokers. This test will save one life for every 320 people screened. At a cost of roughly $250 – $400 per scan, this works out to $80,000 – $128,000 per life saved.
Hence, the USPSTF has approved screening tests worth roughly $100,000 per life saved, but not tests costing roughly $200,000.
Of course, the cost of the initial screening test is not the only relevant factor. With all such tests, patients and doctors must also weigh the risk of an undetected cancer vs. the risk of a false positive result (and associated risks of potentially unnecessary additional tests and treatments). Hence, the USPSTF estimates a much higher “$5,277,308 to prevent 1 prostate cancer death” with PSA screening, based on costs of treating patients who initially test positive but ultimately prove not to have a fatal cancer, rejecting that as “not high-value care.”
It is instructive to compare the $200,000 (or $5,300,000) figures with values that other branches of the federal government place on a human life. Regulatory agencies such as the EPA routinely utilize a figure called the “Value of a Statistical Life” (VSL) when conducting cost-benefit analyses of policies that affect public health. In 2011, the New York Times reported that the EPA set the VSL value at $9.1 million and the FDA at $7.9 million.
Those who favor more regulation prefer a higher VSL, because it allows them to impose more expensive mandates on businesses while still claiming that the benefits outweigh the costs. Conversely, when the Bush Administration in 2008 dropped the EPA VSL from $7.8 million to $6.9 million, many on the political left were outraged, viewing it a backdoor method to gut environmental regulations. Imagine the outcry if the Bush administration had attempted to set the VSL at a mere $5,300,000 (let alone $200,000).
My point is not that the federal government should set a higher dollar value on a patient’s life under ObamaCare. Rather, the government should not be setting any such value at all, whether it’s $200,000, $5 million, or $20 million.
Patients (in consultation with their doctors) should be free to decide for themselves whether a medical test or treatment is worth it to them, based on their specific personal and economic circumstances. Just as the government should not (and cannot) decide who you should marry, where you should live, or what job you should accept, it should not make such highly personal medical choices for you.
Rather than the USPSTF “one size fits all” approach, the American Urological Association properly recommends a more nuanced approach towards prostate cancer screening based on a patient’s family history, race/ethnicity, and individual tolerance for cancer risk. According to the AUA, men aged 55 to 69 “should talk to their doctors about the risks and benefits of PSA screening and make a decision based on their personal values and preferences.”

Even President Obama’s own doctor adopted this more nuanced approach. When President Obama turned 50, he made an “informed patient request” for a PSA test and received it, even though this violated the guidelines set by his own federal task force. If it’s wrong for patients to undergo routine PSA testing, then that meant the President’s doctor was acting irresponsibly. Conversely, if it was right for the President (in consultation with this doctor) to override USPSTF guidelines and tailor his medical care to his individual preferences, then you too should enjoy that same freedom.
Most proposed systems of free-market health reform enable patients to decide how best to spend their own medical dollars through mechanisms such as Health Savings Accounts. In contrast, ObamaCare imposes numerous restrictions on what health insurance individuals must purchase, what services insurers must include, how doctors and hospitals can be paid, and how physicians should practice.
When the government controls how medical dollars may be spent, it in effect sets the price of a human life. The USPSTF guidelines have given us a hint of what that price will be. Under ObamaCare, you’d better hope that this price at least keeps up with inflation.