Health Affairs, 26, no. 3 (2007): 624 doi: 10.1377/hlthaff.26.3.624 © 2007 by Project HOPE	New Online   Pay Cuts For Medicare Docs   Access To Care Woes   Public Coverage More Efficient   Empowering Consumers

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Risks & Benefits

PROLOGUE

Risks, Benefits, And Uncertainty In Health Care

Wide variations in the risk-benefit balance lead to regulatory agencies’ making some decisions about acceptable and unacceptable risks for us. We can choose not to use seat belts, risking fines as well as death or injury, but there’s no choice about air bags in most new vehicles. John Graham, dean of the Pardee RAND Graduate School and onetime head of the Information and Regulatory Affairs Office, Office of Management and Budget, asks, "Who decides?" He examines what factors determine the balance of public regulation and individual decisions.

Health risks arise in medical care, workplaces, travel, and recreational activities, but people don’t necessarily evaluate different kinds of risks comparably, or even know their relative magnitudes. Peter Neumann and Joshua Cohen of the Tufts–New England Medical Center compare risks of death that people—sometimes nearly all people—accept voluntarily. Some risks are much greater than others; prepare to be surprised by the rankings. Choices are complicated when both risks and benefits are well known; they become more difficult with more uncertainty, which may require long intervals and much more data to resolve. In a Perspective on these issues, Peter Juhn, Audrey Phillips, and Kathleen Buto of Johnson and Johnson examine how additional information may shift the locus of decision making among patients, providers, and regulators.

Can economic theory help here? Even the simple economic model of expected utility, which says that we should protect against the most catastrophic risks to health or to our finances, recognizes that people differ in both objective risks and subjective reactions to them. Neither consumers nor politicians making decisions for us about health-related risks appear to follow that model consistently, as Mark Pauly of the Wharton School explains. Trade-offs are inevitable, and rational choices are hard to pin down. What is the ideal amount of alcohol to drink? And does it matter whether it’s whiskey, wine, or beer?

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