As Robert Litan explains, one of the biggest opportunities in medicine is the use of databases that link genetic information, medical histories, behavior, place of residence, and more to determine how various maladies emerge and how to most effectively counter them. The problem, however, is that we have yet to build such databases, in part out of concern for patient privacy. There remain lingering doubts as to whether or not we can “depersonalize” the data that is collected well enough to protect individuals from privacy intrusions.

What Litan doesn’t mention is that one of the reasons there is so much anxiety about this kind of medical privacy is that consumers fear that medical insurers will somehow gain access to this information and use it against them. Though I am a strong believer that the U.S. health system should be more market-driven and that business-model innovation is the best way to deliver better care at lower cost, this legitimate anxiety is one of the reasons why I think the federal government has to play a role in bearing the costs associated with catastrophic medical expenditures and expenditures associated with the management of chronic diseases.

This latter point, regarding chronic disease, comes to mind in light of recent discussions on the role of government in shaping our diets and exercise patterns, etc. One common observation is that the socialization of medical risks has sharpened public health concerns, e.g., whether or not an individual smokes or consume large quantities of sugary soda matters to the state insofar as the state will have to pick up the tab for the health problems that will (presumably) result from these choices, or so the argument goes. It is worth noting that this would be true even if we moved towards a more market-driven health system. Imagine that we encourage greater cost-consciousness by requiring higher deductibles and co-pays for most medical expenditures. Virtually all of the center-right reforms I can think of aim to insulate the less-affluent from costs above a certain level. And of course those with chronic diseases blow past their deductibles relatively quickly, as they have extremely expensive medical needs.

The anxiety about regulating the bodies of the poor, and the anger we have towards the idea that an aesthetic distaste towards fat on the part of elites, including public health elites, is entirely understandable. But it is hard to imagine a near-term reform that would reverse the socialization of medical risks, particularly for the very poor. Given that poor people are somewhat more likely to engage in dietary practices that are harmful to long-term health (whether out of a lack of resources or due to high allostatic load or a lack of noncognitive skills, etc.), we’re faced with a serious dilemma. The most attractive way to address public health problems of this kind is to address them indirectly, e.g., by increasing overall societal wealth and by investing in human capital. The hope is that these approaches will help people move up the economic ladder and cultivate the skills they need to climb even further, and this will have significant spillover benefits for health. Yet these indirect approaches take a long time to bear fruit, assuming they will work at all, which is why public health officials are inclined to “get creative” by introducing nudge strategies and more targeted public health education campaigns. This is indeed nanny-statism. But it is rooted in fairly compelling concerns.