Making informed decisions, part 1

Summary: Most areas of knowledge are so big and complex that most people will never know anything about them. This includes some areas that affect everyone every day, like health/medicine. Non-experts have a hard time making good decisions.

In Part 1 (this article) I describe the problem, using health & medicine as an example area of life which is hard to master.

In Part 2 I explore some detailed aspects of the problem, including examples of "good" experts.

Making good choices in health & medicine

You make health-related choices every day. What you eat, how you relate to others, career choices you make, how much you exercise -- all this influences your well-being.

But medicine is a huge body of knowledge. It's also constantly evolving. Even doctors have trouble keeping up; some doctors don't even try to keep up, thus indirectly harming their patients when they apply old methods of treatment and give advice based on old research when there are already more effective ways to help patients. There are also many parts of medicine which are simply controversial because there is no conclusive research to date, so different experts will tell you different things.

What’s particularly hard, some critical health effects are only visible in the long-term. A single “bad” day in terms of bad diet, lack of exercise, smoking or drinking too much alcohol do not result in any immediate problems. Long-term effects remain intractable. So we don’t learn from “mistakes”, because mistakes are in the habits, not individual behaviors.

Online information is hard to find, often incomplete or simply wrong. It’s hard to evaluate without expert knowledge. You’ll find conflicting information of pretty much any medical topic. It’s not just that there’s lots of bad medical information on the Internet, even the parts that are good are scattered and hard to tell apart from the “bad” information.

Moreover, doctors and pharmaceutical companies don't really have economic incentives to "solve" the problem of unhealthy lifestyle. Why? Because they are mostly in the "treatment" business, not in the "prevention and education" business. Think about it. If everyone lived a healthy lifestyle, doctors and those companies would lose majority of their income. They would still be needed to diagnose and treat some conditions, but many products and many consultation hours would simply be unnecessary, and many conditions would be avoided altogether.

Note: I don't think that complexity issue or incentive issue is specific to medicine. However, health is a major area for everyone in which problems may have dramatic effect on well-being. In the worst case, when individuals consistently make bad medical decisions throughout their life it leads to huge financial costs and great suffering.

Where does the problem come from?

Humans are learning a lot very quickly through science and business specialization; the world is very complex. So our civilization gets more and more advanced, and we get more and more “ignorant” compared to the experts. In that sense we get more "ignorant" over the years, even if on an individual level we are learning. And we keep being ignorants in all the areas except the few in which we specialize. 

• It's very hard to check if given piece of advice or information is “true” if it’s from a field we’re not experts in. 
• Results of our decisions are often delayed past the point of “no return”, so learning from our own experience is impractical
• Man is weak. We like sugar. Cookies taste well. It's biology (see post on hyperbolic discounting, though the issue is... yeah, more complex)
• Typically, the fields which are less scientific are more prone to error and speculation
• More money => more FLP issues (business thrives on sales, not on helping people make good choices)
• We live on “autopilot” (heuristics, biases). It minimizes effort on our part, but it leads to poor choices when non-obvious knowledge is out there
• Personal experimentation is very difficult. It’s impossible to run proper experiments on ourselves, e.g. how do you experiment with diet without ruining your normal life? How do you control for emotions, stress, weather, other foods you ate recently etc. when trying to figure out the effect of, say, sugar on your well being?
• Lack of competition, especially in form of cartels or monopolies, will probably aggravate the situation regardless of the field
• In the end, sometimes even experts get it wrong, i.e. experts make bad decisions, too.

A note on incentives and ethics of experts

Doctors and pharmaceutical companies are "experts". But they are not really that “good” for us. It’s not their business to educate us. They want us to keep coming back for what they are selling. It's true for most professionals. Again, doctors are in the “treatment” business, not in the “education” business.

So if you are an expert in any field, what do you do?

Do you try to get the same client again and again, or do you help the client become self-sufficient?

In my own experience as a teacher or trainer I always strived to provide the learners with enough understanding and tools to make them independent; but I'm not kidding myself; most people are not as benevolent.

Incidentally, Dan Ariely recently wrote about this kind of conflicts of interest among dentists in the USA. Read it, it's short and to the point.

So when you are paying for the services of an expert, keep this in mind:

• Experts are paid for what they know - so they don’t have such a great incentive to educate everyone. You need to remain your expert status to be worth something in the market.
• It’s easier to remain being an expert by NOT helping others become experts than it is by learning NEW (better) information all the time. This leads to entrenched systems.
• Some people pretend to be experts and we just get fooled. It can work if such a ‘fake’ expert gets many new clients quickly and if they can’t warn each other. Also, often you get paid for something before the result is visible.

You may need to ask lots of questions to get the "most" of your interaction with an expert; they won't just tell you all they know.

Part 2

In part 2 of the article I'm showing examples of "good" experts, and a few ways I use to solve the problem.

Comments

[Arek]

A lot of that is based on the assumption that money is the ultimate value for all people (or 'experts' for that matter). Maybe that's a bit idealistic of me, but I believe many of them value helping others as high as the money they're getting for it - and it's not just a few exceptions.

[Jakub Petrykowski]

Professionals or experts have much more at stake than just money when they help their clients.

It may be about the perception of being needed ("I have something to offer"); or about their perception of job security ("I have a job, I don't have to worry about my future"). The need for money, or even greed, are not the only factors here.

I think it's extremely difficult as a professional to avoid conflicts of interest, because they are built into being an expert.

When clients rely on you making recommendations, and they get paid for result of these recommendations, that is a place where conflict of interest is inherent.

Imagine a dentist who says: "you should treat that tooth". You agree. Then he starts treating that tooth for you, so he reaps the benefit.

What if it was another, randomly chosen doctor, unaffiliated with him, that would get the job and the money?

Or a psychotherapist, to whom you go for a 1 hour consultation. He listens to you carefully, and provides his evaluation at the end. "It seems to me that you have some deep behavioral problems, and your best bet is entering therapy." He then goes on to say how he will provide such a therapy service for you, which, by the way, may take several months or years.

What if you went to another therapist with that evaluation, and the current one would never see you again?

I believe that many doctors or therapists would think twice before suggesting treatment if they knew someone else would reap the benefits; they'd have less (conscious or subconscious) motivation to say "yeah you should do something about it".

It's the same in B2B. You talk to a salesperson or a consultant; they tell you your website is really bad and you should improve it. You are convinced. Then they go on to selling you a new website.

Now I'm NOT saying it's bad that professionals of any kind both convince you about a need and sell you something.

What I'm saying is that as a client, you'd best be aware that often they may have reasons to keep you uninformed, and guide you (or manipulate you) into buying whatever it is they are selling. They can do it precisely because they know so much more about the topic than you do.

If you happen to meet professionals who are "moral" in the sense that they often say "you don't need what I have to offer" or "there is another, better way for you to solve your problem than by paying me", then you are either skilled at choosing experts, or lucky :)

[Cezary]

"If everyone lived a healthy lifestyle, doctors and those companies would lose majority of their income. They would still be needed to diagnose and treat some conditions, but many products and many consultation hours would simply be unnecessary, and many conditions would be avoided altogether."

This seems naive. Healthy lifestyle would affect life expectancy. People would live longer so they would pay for healthcare longer. They would buy more drugs. Then they would die anyway, after spending weeks or even years in the ICU, consuming lots of drugs along the way. J. Random Patient could die from exactly the same heart attack as in the baseline scenario, but 20 years later. I’d rather expect doctors and drug industry to benefit from popularity of healthy lifestyle than losing "majority of their income”.

I get your point, but this is just not a good example.

[Jakub Petrykowski]

@Cezary

Everything that I write below is my best effort done this evening to justify my position. I'm not an expert on healthcare costs :) so perhaps someone with the right facts could disprove what I say. Until someone does, I stand by my opinion :) Details below.

There are two sides to my argument that "healthcare industry would lose money if we lived a better lifestyle". One is that people who live 'well' don't get sick as much (and as severe), and the other one is that they also self-treat much more often because medical knowledge is not limited to doctors.

You seem to be saying that the first part isn't right :)

You wrote: "They would buy more drugs. (...) consuming lots of drugs along the way... Could die from exactly the same heart attack" -- would they? Drugs for what conditions? People who live a healthy lifestyle get ill considerably less; both age-specific and life-long incidence of serious conditions like various types of cancer, cardiovascular disease, and diabetes is much lower for people who exercise and eat well.

Also, when a person dies, that actually means the end of healthcare costs related to that person. Living long with a serious condition costs real money, and emergencies/surgeries do.

I don't have hard data to support this claim right now, but I believe that there are EXTREMELY high costs of living unhealthy life as compared to a healthy one -- here's why I think so:

I agree with you that avg. life expectancy would grow further (it's been constantly growing anyway for many decades), but I'm speculating (key word: speculating) that total medical cost per person (over their lifetime) is smaller for people who live "well".

So again, the kinds of diseases people get DEPENDS on lifestyle. People who live well get diabetes, cardiovascular disease and some kinds of cancer not nearly as often as people who live an unhealthy lifestyle.

These lifestyle conditions cost tens-hundreds of dollars over many years before the person dies.

Yes they may die suddenly as well; but that seems to be a minority, let's consider diabetes alone:

- there are estimated 25 million people with diabetes in the US in 2011 (http://www.diabetes.org/diabetes-basics/diabetes-statistics/)
- ~11 million of people above 65 years old in the US are known to have it in 2009 (http://diabetes.niddk.nih.gov/dm/pubs/statistics/#fast)
- another ~80 million are in pre-diabetes stage.

That's more than a 100 million total in the US alone, but only less than a million a year dies from diabetes or cardiovascular disease (http://www.cdc.gov/nchs/fastats/lcod.htm/). So it seems to me that with this kind of disease spends money on healthcare for several years.

This is a very rough thinking, but I'm guessing that people who live healthy lifestyle don't incur large medical costs over increased lifespan, not even close to what they do now.

@Cezary
Do you still think I'm wrong? If yes, which part of my argument doesn't convince you?

[Cezary]

1. “The oldest group (85+) consumes three times as much health care per person as those 65–74, and twice as much as those 75–84 (Fuchs 1998).” Source: http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/
This plus increasing life expectancy… Our bodies will fail eventually anyway, no matter how healthy lifestyle we’re practicing. It’s just a matter of time. It can fail in a costly manner (anything that requires long-term treatment and surgeries) or not (like sudden death). Yes, some diseases will be more rare but some other will be more often.
2. Popularity of healthy lifestyle would probably shift assets from some fields (like interventional cardiology) to others (geriatrics, oncology). I read that advancement in cardiology led to increasing number of cancer patients, because that part of the population lived long enough for some cancer types to develop. Health-wise? Great success. Cost-wise? Not really. Solving one problem often leads to another, especially in the public health.
3. Healthcare cost is a “wicked problem” so it’s not following any simple pattern: http://www.newyorker.com/online/blogs/comment/2012/06/something-wicked-this-way-comes.html
You can’t know what people would do with extra money they saved by being healthy. They could as well make more cosmetic surgeries or buy tons of Viagra and birth control and have orgies all over. :-) What I mean is that medicine and pharmacy is not only about healing, it’s also about the quality of life and the “beauty business”. This is why I seriously doubt that
“losing majority of income”. Pharmaceutical business is not run by stupid people, they would adapt easily to any health market situation. They can sell supplements for sportsmen instead of insulin, if that what the market wants.

[Jakub Petrykowski]

The fact that CURRENTLY old people consume more per person in healthcare doesn't mean that EVERY or even AVERAGE older person does, and even more important - it doesn't say anything about what is the relation of lifestyle to healthcare costs.

Also, people who care for themselves spread the costs into many different kinds of goods and services (e.g. more expensive food, more frequent vacation, 'well being' practices like yoga, sports, travel, massage etc.) and in total they may be spending more, but actual healthcare costs could be lower.

2. It's true, but doesn't prove that neither your point nor mine.

I think we'd need more data here. But honestly I am not that interested in disproving myself here :)

3. I agree that industries will adapt by selling other things to people. However, this actually proves my point :)

My point wasn't that "people will spend less money on health-related goods and services". My point was that "[various] experts and pharma companies will lose business". This means they will lose business in some areas, which they will naturally try to fix by making new business - adapting.

In other words, a lot of the money now goes to doctors and pharma companies that fix issues that can be avoided with lifestyle, and that can be avoided with better knowledge (provided people have that knowledge and that they use it; both are difficult though :( ). When people start to live a healthier lifestyle, they start spending money on other things.

Now, maybe to wrap up this discussion, I'd say that you have a good point that doctors and pharma won't simply go out of business becuase they will adapt, and sure enough even in optimistic case it may take decades or centuries before current major lifestyle-induced disease is no longer a society-level concern (as it seems to be now in the US for example).

I think I really wanted to make a broader point -- that for a non-expert it's really hard to know what to do, and experts thrive on that.

[Jakub Petrykowski]

One more thing about "pharma and doctors will simply adapt".

That is exactly my point about incentives! It's good [for us] if we force them to adapt by becoming smarter and living healthier; it's bad [for us] if we remain ignorant and let them get easy money when *we* could adapt a bit and live a better life.

When you know something that you can offer for a long time and its value doesn't diminish that is a very comfortable position, isn't it?

I believe there are lots of people who don't seem to need to learn much, they work in entrenched systems that protect them from change. They also do a lot to make sure that people are dependent on them. These are some of the most destructive systems you can imagine: corrupt governments, bad governments (lazy, not doing their jobs), lobbies, monopolies, cartels.

Some fields of professional services may behave in a very similar way, leading to bad results for people who rely on them.