Category: Medicine

COVID-19 was at first believed to be a public health threat on par with SARS, with a mortality rate around 10%. Since then, better data has shown that it has much lower case mortality, comparable to the case mortality of ordinary pneumonia (which is about 1.4%, see here and here). It is a threat only to the elderly and those with pre-existing health problems, again like ordinary pneumonia. Bizarrely, the world’s politicians, public health officials, journalists, and other opinion leaders have instead decided to escalate their reaction, as though unaware of the change in factual reality, or unwilling to admit error.

The most striking thing about the cycle of one-upmanship in overreaction is that the solution is always to curtail freedom. If people are willing to renounce their freedoms over small risks, how easily will governments be able to curtail freedom when there is a more serious threat. As with the exploitation of 9/11, this objective is attained by promoting excessive fear, which short-circuits reasoning even among the educated.

There are two types of factual distortions when making these faulty risk assessments. First, the risk of the new threat is overestimated. Second, already existing risks are underestimated or ignored altogether. These errors combined to create a gross overestimate of marginal risk.

According to a study of 1099 Chinese patients, published in the New England Journal of Medicine, the mortality of COVID-19 is 1.4% of those who test positive. Since at least as many others are asymptomatic and never tested, true mortality is likely 0.5% to 0.8%.

The increased risk of death is mortality times prevalence. In China, prevalence is 1 in 15,000. In Italy it’s 1 in 5000. In the USA it’s 1 in 200,000. In all these nations, the risk of death is less than or equal to dying in a car accident. So driving a car instead of taking public transit to avoid COVID-19 may actually increase your risk of death. In any event the marginal risk, positive or negative, is miniscule. Someone genuinely worried about this level of risk should avoid driving or riding in an automobile.

Suppose that containment fails, as seems likely, and further that this new strain becomes as prevalent as other forms of flu, so that COVID-19 should have about 2% prevalence, i.e. 1/5 of flu cases (10% prevalence). The increased risk of death, compared with average flu mortality of 0.1%, would be 1/50 * 1/200 = 1/10,000. Here I assume mortality of 0.6% for COVID-19 vs 0.1% for average flu. This is to compare apples to apples, since the flu figures include (estimated) unreported cases. Most sites get this wrong, and compare the flu figures for all cases against the COVID-19 figures for positively-tested patients only.

This figure of 1 in 10,000 is likely overstated, since it excludes consideration that many of the “excess deaths” are in people with preexisting conditions who would have died of something else shortly. This pessimist scenario, in a nation of 300 million, would result in 30,000 excess deaths.

Preventing such a scenario is certainly worthy of strenuous measures, but not without limit. One must also consider the effectiveness of such measures, and the cost in terms of public health. Sinking the economy and depriving people of months of income may cause comparable excess deaths, especially if people are prevented from getting cancer screenings as some health systems are recommending. 30,000 excess deaths represents a 50%-60% increase in annual flu deaths, but there are other bigger killers, both those existing, and those we may create by excessive reaction to this new public health risk. A simplistic attitude that “no measure is too big” fails to be a rational form of risk management.

At some point, we may have to grapple with the possibility that containment does not work. The USA may not have the same legal means at its disposal to compel quarantine that may exist in the more centralized authority of Italy or China. Also working against containment is the low mortality rate, the possibility of carrying the virus in mildly symptomatic and asymptomatic individuals, and the unusually long incubation period. Indeed, once the virus proliferates beyond a certain threshold, containment of COVID-19 would seem to be as impracticable as containing the common cold or the flu. While we may not have reached that point yet, we must recognize the possibility that at some point continued efforts at containment are not worth the cost, simply because of their low probability of success.

The reactions have been so rapid, and so outpace the actual facts on the ground, even when the number of cases is statistically negligible, that we cannot consider them to represent the result of careful deliberation. Rather, as in the closure of multiple universities on the same day, it is more like the imitative behavior of a panicked and stampeding herd. In such a climate, it may take more courage to do less than to do more. It is very easy to say that money is no object and leave the private sector to pay for government largesse. Those of us who have to make budgets and do not have the power to print money may have a different perspective. This is not a mere economic problem, for it can swiftly transform into a humanitarian catastrophe at least as great as the one ostensibly being prevented.

Update: 28 March 2020

Misinformation continues to spread. First, there is the oft-repeated claim that, absent our draconian containment measures, the virus would spread to 60% of the population, resulting in millions of deaths in the US. This is a cumulative figure over two or three seasons, ignoring the near-certain fact that pharmaceutical measures and natural antibodies will reduce the virulence of the disease by next season. It is effectively an impossible scenario, and again is not comparing apples to apples, as the seasonal flu death figure is annual.

Second, the mortality rate continues to be overstated. As testing becomes limited only to those who are hospitalized, the “mortality rate” of tested positives will increase, since you are actually measuring only the most severely affected subset of cases. Worse, in Italy, anyone who dies with coronavirus is counted as a death due to COVID-19, although 99% of fatal cases had comorbid conditions. The best data from South Korea, which has far more aggressive testing, currently points to a mortality rate of 0.7%. Using this figure as an upper bound and applying the more exact population of 327 million for the US yields a “pessimist” scenario of 39,000 excess deaths this season. We may get there anyway as outright containment has proven ineffective, and we are now hoping only for mitigation, i.e., slowing the spread.

Chief Justice John Roberts’ surprising decision to uphold the Affordable Care Act [PDF] is a refreshing reminder that court decisions are usually about the law, not political ideology. Journalists and the general public, lacking legal expertise, tend to interpret decisions in terms of politically favored outcomes, and impute similar motives to judges. In reality, judges tend to split along ideological lines not because they make politically informed decisions, but rather political ideology tends to align with jurisprudential approach. Still, most decisions are sincere interpretations of law according to coherent principles. Roberts’ decision is an exceptionally incisive treatment of the issues at hand.

Most strikingly, Roberts upheld the constitutionality of the Act while rejecting the application of the Commerce Clause to the so-called “individual mandate.” He plainly affirms: “The Federal Government does not have the power to order people to buy health insurance. Section 5000A would therefore be unconstitutional if read as a command.” The “mandate,” then, cannot be interpreted as a mandate. It is not illegal to refuse to buy health insurance, as there are no legal penalties save the requirement to pay slightly higher taxes. By rejecting a Commerce Clause argument, Roberts cuts off the possibility of future mischief by Congress attempting to regulate all activity and inactivity. Justice Scalia, in his dissent, gives a biting criticism of the opinion of Ginsburg et al., which would effectively abolish all limits on the scope of federal power. He pointedly notes the central fallacy of her instrumentalist philosophy, supposing that the Constitution enumerates problems to be solved, rather than powers of government.

Yet Roberts separates himself from the Court’s “conservative” wing – which in this instance includes the “moderate” Justice Kennedy – by allowing that the penalty imposed on the uninsured is effectively a tax, even though the law itself calls it a “penalty.” In Section III-B of his opinion, he cites precedent showing that the label applied to a fee or penalty does not control its constitutional status as a tax (though it does control the applicability of the Anti-Injunction Act, here ruled inapplicable). Further, he upholds the principle of judicial restraint by insisting that a law should not be overturned if there can be found a reasonable construction whereby it is constitutional. The construction that the mandate is a tax, though unintended by the legislature, is reasonable, and therefore the law may be upheld. This heuristic favors the functional effect of the law, rather than legislative intent or wording. Yet this interpretation does not oppose the intent of legislators, who would surely prefer that their law be held constitutional even if not on the same grounds. Roberts cites precedent showing that it is not necessary for Congress to specify the correct power it is using, as long as it is in fact using a constitutional power.

The interpretation that the “penalty” is a tax is reasonable, according to Roberts, for several reasons. There is no indication that a person may be prosecuted for failing to purchase insurance, so such omission is not a crime, in which case the additional tax is not a fine. The “penalty” is collected through ordinary income tax filing, and those who do not have to file do not pay anything. The penalty is small (only 2.5% of adjusted taxable income), in most cases much less than the cost of buying insurance, and can never exceed the cost of insurance. In fact, it is projected that 4 million will elect to pay this penalty rather than purchase insurance. Roberts also suggests that the absence of a scienter requirement proves that this is not a penalty for unlawful behavior, but Scalia rightfully skewers this notion. Nonetheless, the rest of the Chief Justice’s arguments hold.

Once it is admitted that the mandate is a tax, one need only show that it is a constitutionally allowable tax, and Chief Justice Roberts makes relatively easy work of this task. He cites numerous precedents of taxes designed to incentivize behavior, and notes that the specification of a determinate circumstance (having taxable income, yet lacking insurance) exempts this from being a capitation tax or “direct tax” in the sense of Article 1, Sec. 2. He further observes that omitting to do something does not exempt us from taxation. The proposed tax is not so high as to become unconstitutionally punitive.

The treatment of the “mandate” as a tax is by no means academic. As the Chief Justice notes:

Once we recognize that Congress may regulate a particular decision under the Commerce Clause, the Federal Government can bring its full weight to bear. Congress may simply command individuals to do as it directs. An individual who disobeys may be subjected to criminal sanctions.

With a tax, by contrast, the government has no coercive authority beyond “requiring an individual to pay money into the Federal Treasury.” There is no further penalty, and the government cannot coerce anyone to buy health insurance, any more than they can force smokers to quit.

The ruling in National Federation of Independent Business v. Sebelius places important limits on future attempts at government mandates, not only because the government is denied broad coercive power over private action or inaction, but also because any future “mandate” will be clearly perceived as a tax, and thus difficult to pass. The so-called “mandate” amounts to a regressive tax, being a flat 2.5% rate, with mandatory minimums, on taxable income. This tax will disproportionately impact the young and the middle class.

Ironically, the “individual mandate” was ruled constitutional in part because it is so weak. The cost is so low, and easily avoided, that there is reason to doubt the basic premise of Obamacare, namely that a shifting of the cost burden to the young and uninsured will make health care more affordable in general. If increased mandatory coverage is not matched by sufficient increases in enrollment, premiums will only go up, discouraging even more people from enrolling, and creating a vicious spiral. Already, in the early phases, premiums have risen more rapidly than previously, with larger co-payments. This is because shifting costs through health insurance reform does little to address the fundamental cost structure problems at the provider level. Hospitals, doctors, and pharmaceutical companies strongly support Obamacare for good reason, and it is not because they expect their revenue to decrease.