Collection: Charlie Munger - #24 'Health Care In America'



[Transcript]

AUDIENCE MEMBER 00:07

One of my favorite lines from your book is, ‘It’s better to be roughly right than precisely wrong.' With that being said –


CHARLIE MUNGER 00:15

That comes from Keynes.


AUDIENCE MEMBER 00:18

Could you elaborate a little bit on the Project Haven? How are you exactly or specifically doing to improve healthcare, lower the cost, improve quality and access?


CHARLIE MUNGER 00:31

Well, that’s a very interesting subject. If you take American health care, in many ways it’s the best in the whole world. We have more brains in our medical schools and our pharmaceutical companies than the rest of the world has per capita. In fact, we may have as much brains as all the rest of the world together.


On the other hand, if you actually went into American medicine, hospitals, doctor’s offices, or – You would find a huge amount of totally counterproductive, unnecessary activity that costs a lot and does no good or actually does harm. And you’d find that some people are not doing that. Or they don’t have the incentives to make money by doing it.


You don’t get a lot of counterproductive medical care. Kaiser here in California does not do a lot of unnecessary stupid medical care, or prolonged death to make more money and do all the evil things that other people do.


Other people, as hospitals and doctors get under pressure, introduce a lot of waste and folly. And some of the pharmaceutical companies, behavior is totally outrageous. They have some basic diabetes drugs and it’s trying to charge some woman ten thousand a month or something, it’s ridiculous. And I even go further. I think it’s evil.


And I think that the system should be changed. And I think it will be changed. I think there’s too much wretched excess in the medical system, and the really sad part of it is, the people who are doing it have no conscious malevolence. They’re not people who decide to do murders and maiming to make money. They think it’s good for the patients, what they’re doing.


And of course, you go to do an unnecessary back operation on somebody, it’s a major evil. But the guy that’s doing it really thinks it’s good for the patient. In other words, he’s turned his brain into cabbage. And that’s not a good thing.


I think you have to change the incentives. I think there are places in America that are very admirable that don’t do a lot of unnecessary stuff and other places that do. And I think we’re going to have to change the system.


If you take the medical system of Singapore, it costs 20 percent of what ours costs and it has better statistics. And it’s not opaque, it’s open. We have a whole industry that tries to make the payment things opaque so they can take advantage of people.


And they think it’s free enterprise. I think it’s stealing.


(Source: https://youtu.be/HS8neXkNnhw)

 

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