Another solution

Paul Krugman has a good point:

Still, isn’t it bizarre that governors who protest bitterly about the cost of Obamacare, and in general about wasting taxpayers’ money, are willing to throw away lots of money via corporate welfare? Actually, no; it’s only puzzling if you think they believe anything they say.

The context is the decision to allow Arkansas to expand the Affordable Care Act exchanges instead of Medicaid.  Aaron Carroll:

Many claimed that the ACA cost too much. They said it would raise the deficit. They opposed the expansion not only because it raised the federal price tag, but also because it was “fiscally unsustainable” for states in the long run. I took them at their word.

I’m now surprised that they prefer a solution that costs more.

Maybe what we really need to do is randomize?  After all, the secondary benefits of high health care spending are definitely unclear.  The United States isn't exceptional relative to Canada or France in terms of medical outcomes.  The benefits to medical innovation could be attempted via a stronger NIH with a broader mandate.  So the only real question is whether private insurance can result in innovations that reduce overall costs and/or improve outcomes.

Surely randomization of states could provide some really useful information and solve this question more directly?  After all, don't we think of it as the gold standard for a causal inference?  And it would be easy to randomize states to several possible versions of the ACA (no expansion, exchanges, Medicaid expansion, public option to allow the uninsured to purchase Medicaid). 

Is there a good reason not to do this?

P.S. Here is a good example of randomization giving us information in an area that is equally difficult for inference.