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Thursday, November 10, 2005

3rd Way: Health Care First

Weekly Standard, The Party of Sam's Club The next set of ideas in the article are about health care. As mentioned above, I am sympathetic to the general idea that we need to make some changes to improve our health care system in America. At the same time I am also very worried about a socialized medicine system arising in response to these problems that 'throws the baby out with the bath water' and severely damages our technological innovations. The article presents these ideas as ways to fix health care:

For instance, Mitt Romney has proposed in Massachusetts that health insurance be made universal by making it mandatory. Allowing individuals to forgo coverage encourages the young and healthy to live dangerously, giving them a free ride on the public purse when things go awry, and making health care more expensive for everyone else. If you expect government to step in when the going gets tough, you have an obligation to make a contribution. But if purchasing health insurance is to be mandatory, it needs to be cheaper. To drive down prices, and free up money to subsidize insurance for the poorest Americans, anticompetitive practices in the health care sector would have to be attacked. As professors Michael Porter and Elizabeth Teisberg have argued, the health care industry is designed to reduce costs borne by intermediaries--hospitals, health plans, physician groups--rather than increase value for patients. So there is a relentless drive to shift costs onto individuals, and to minimize competition through network restrictions that prevent consumers from finding the best care. Medical providers collude to suppress information about the quality of care, a practice that would be considered intolerable in any other industry. By negotiating for steep discounts from provider groups, large employers and the government make the individual insurance market intolerably expensive for most Americans. Eliminating these bottlenecks will, over time, go a long way towards reducing costs, while increasing consumer choice.
Finally, the goal of any health care system ought to be security against catastrophic expenditures. Individuals can choose to pay for comprehensive coverage, but the responsibility of government should extend only to making sure that all Americans purchase a high deductible policy--rather than subsidizing gold-plated plans for upper-income Americans, which the current system often does.
The idea of mandatory insurance bothers me, but if we assume that either the Government or Health Care Providers will step in for those who don't have it, the idea has some merit. Obviously though, this will hinge upon the idea of making insurance cheaper. I agree that there are lots of anti-competitive practices in the health care and health insurance industries. In many ways it is the worst of government intrusion and laissez fair with none of the benefits of either. Tackling those issues is complex though and while I agree that we should try, the devil will be in the details. It is I think a first step though. The last idea, health insurance being primarily for catastrophic problems is both good and bad. Certainly our concept of health insurance paying for general expected care makes a mockery of the very term insurance and is a portion of the problem. However, there remains the problem that illness that is treated early is often dramatically cheaper and less 'catastrophic' than illness that is left untreated. A system that only pays for catastrophes seems likely to increase catastrophes. My thoughts on this section is lets worry about attacking the anti-competitive aspects of the health care industry and then see where we are. If the cost of health care can be lowered, and more competition allowed to flourish we might not need either mandatory insurance or government intervention to make insurance only a catastrophic problem. I don't know how far that will get us, but it is worth looking at. All together this section was a disappointment to me. It contains a pretty good summary of the problems, but the solutions were weak and non specific.


Blogger Cubicle said...

"The idea of mandatory insurance bothers me, but if we assume that either the Government or Health Care Providers will step in for those who don't have it, the idea has some merit."

Why you have to have insurace for you car? (That actually bothers me also)

I honestly don't see a way of enforcing the above idea. When are you going to find out someone does not have health insurace? When they have been hit by a car and they are dying? You can't do much, except let them die, and that is not right.

Though if you made it a law, i suspect the same percentage of people who do not have car insurace will also not buy health insurace (You could use those numbers to deterimie if it would lower costs)

11/11/2005 09:34:00 AM  

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