An Update to a Classic Work of Health Economics

This story was updated on September 18, 2023, to reflect the passing of Victor Fuchs.

It is hardly news that America’s health care system is complicated, expensive, and, in many ways, dysfunctional and that the nation’s health care outcomes are falling behind those of other, even sometimes poorer, countries. The problems of rising costs and disparities in access and outcomes were already well established in 1974, when Victor Fuchs, the late Henry J. Kaiser, Jr., Professor of Economics and of Health Research and Policy at Stanford, first published his seminal book Who Shall Live? Health, Economics and Social Choice. In what turned out to be the first edition of the book, Fuchs applied fundamental concepts from economic theory to health and medical care in an innovative manner that hadn't been attempted previously, presenting an economic framework for addressing health and medical care challenges and emphasizing the importance of choice at both individual and societal levels. The publication became a classic introduction to health economics and is recognized for pioneering the field.

Now a third edition of Who Shall Live? has been released by World Scientific Publishing, co-authored by Karen Eggleston, director of Shorenstein APARC’s Asia Health Policy Program. This edition adds supplemental research and an all-new section that focuses on the decade 2012–21, specifically looking at the Affordable Care Act, the COVID-19 pandemic, the intersection of health and politics, and the state of expenditures and outcomes during that period.

Eggleston was honored to be able to work with Fuchs, who had also been a senior fellow emeritus at the Freeman Spogli Institute for International Studies and the Stanford Institute for Economic Policy Research, but noted that “it was a little depressing to hear him conclude that the pandemic would not be the 'wake-up call’ for systemic reforms that he has spent a lifetime showing the United States needs.” Fuchs passed away peacefully in his longtime home on Stanford’s campus on September 16, 2023. He was 99.

Part of the story of U.S. health care is its poor showing compared to other, often less-affluent nations. Japan is one of the comparison countries in the updated section on the last decade; in one example, Eggleston describes, “between 2012 and 2019 (pre-pandemic), life expectancy at birth did not increase at all in the United States, while it increased 0.18 years per annum in Japan, and 0.16 years per annum across 10 other high-spending OECD countries.” This is despite the fact that “in 2019, Japan spent only 63% of what the United States spends on healthcare (as a share of GDP)… Why can’t we do better for Americans?” 

This question is precisely the one that Who Shall Live? aims to answer—that the state of any health care system is a result of “the necessity of choice at both the individual and social levels.” To shrink the costs of health care in the United States and improve outcomes, different choices have to be made—by patients (in their personal lifestyles and behavior), by physicians, by hospitals, and by the U.S. government.