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Author promises solution, but doesn't deliver

On page 167, after a discussion of the healthcare reforms of the Nixon administration, an examination of the absurdities of Medicare and Medicaid, and a dissection of Hillary Rodham Clinton's failed health system overhaul, the reader will finally learn why Dr. David Gratzer wrote "The Cure: How Capitalism Can Save American Health Care." It turns out that his father endured lengthy delays at the hands of the Canadian health service, a nationalized system.

Fed up, he went to the United States, got a prompt diagnosis of a serious spinal condition, and "surgery was offered for the next day."

More than anything else, that near-catastrophe seems to fuel the younger Gratzer's rage towards any "single-payer" healthcare system. If it didn't work for dad in Canada, how can nationalized health ever work in the United States?

So while Gratzer, a fellow at the conservative Manhattan Institute, finds much wrong with America's splintered healthcare system, he insists the solution is not to be found with nationalized health.

Yet he never does find a "cure" for the problems that plague our system: over-consumption by patients, innovation-stifling regulation, and runaway costs.

Gratzer dutifully champions some of the latest gimmicks in US healthcare, including health savings accounts and "consumer-driven healthcare," which really mean patients foot a larger share of the bill. But he has no solution for the fundamental problem facing the US: an employer-based insurance system created as a result of a tax policy glitch in World War II.

He acknowledges the circumstances that led to our system but never addresses how it is breaking down.

Elsewhere, Gratzer takes on such obvious targets as the Food and Drug Administration, and reaches erroneous conclusions. He argues that the FDA should screen drugs only for safety, not efficacy, and puts forth the naive proposition that the market will decide which drugs are most effective. As he puts it, "A drug that did little or nothing would not remain on the market for long."

An odd statement given that 50 pages earlier, he related the cautionary tale of Nexium, the "new purple pill" that AstraZeneca concocted because its patent protection was running out on Prilosec, and it needed a new blockbuster, even if it wasn't any better than its predecessor.

Could the real problem be drug companies that put profits before real innovation and use million-dollar ad campaigns to ensure the success of such me-too drugs as Nexium?

His synopsis of the rise and fall of HMOs in the 1990s illustrates how Gratzer can write about the problems in US healthcare without seeing the big picture. He shows how HMOs used tight networks and strict rules to successfully control health spending. But consumers rejected them, seeking more flexibility.

But Gratzer doesn't put the collapse of HMOs into context with the unprecedented prosperity of the 1990s. People demanded more expensive healthcare, and employers provided it because they could and didn't want to lose employees over health benefits. We're still paying the price.

Jeffrey Krasner can be reached at

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