Health Care Proposal
What I don't understand is why the republicans or the blue dogs or some bipartisan group or somebody doesn't drop into the hopper a plan based on the following:
1. Universal coverage based on the French model, which essentially gets the government out of the healthcare business (other than the catastrophic care umbrella, the government is limited to doing what your employer does, deducting money from your paycheck and sending it to an insurance company).
2. Transition rules for medicare and medicaid. My approach would be to fold medicaid into the new system immediately, and to allow medicare recipients a choice: if you're on medicare now, you can keep it; if you are between, say, 50 and 65, you can choose either to go on the new system now and punt medicare, or keep your present coverage until you do go on medicare; if you're younger than 50, you are on the new system. I think those ages would reasonably reflect the costs and benefits associated with the different approaches, and over time medicare would phase out.
3. Tort reform focused specifically on replacing large monetary punitive damages with a mechanism for getting bad docs off the street (what punitives are supposed to accomplish but don't).
4. Bringing significant pressure to bear on other countries to pick up their fair share of R&D costs, so that drug costs could be lowered here. We probably have to streamline FDA to get anyone else to agree, and there's nothing wrong with that.
5. Increased competition for medical insurance, by removing current regulations that function primarily as barriers to entry.
6. Do the kinds of techie things that Newt's group, among others, have recommended to cut costs and improve results.
What we have now might be called a private insurance system but is definitely not a competitive free market system. It is certainly less of a free market system, with more government intervention, than what France has (and I favor).
The French break health care into three components--primary care, elective care, and catastrophic care--and handle each separately. Catastrophic care is the one area where the government is directly involved; you have a cancer or AIDS and run up some threshold amount of cost, after that you're on the government nickel. This is probably a reasonable role for government since they have the deepest pockets, and being relieved of this exposure gives private insurers some freedom to offer more creative and competitive coverages. In particular, it eliminates a lot of pre-existing condition issues.
Primary care is universal, but there is no government agency like National Health Service. As a generally free-market economist, I can justify universal primary care because of the neighborhood effects. If I can afford health care but you can't, and my kid sits next to your kid in school, are my kid and I both better off if your kid has access to basic checkups and vaccinations? I think so, particularly if it can be handled in the private sector like the French do. What they do is to collect enough through their social security system to fund about $3400 per capita per year, which is turned over to a consortium of insurance companies, in exchange for which the insurance companies provide everybody an access card (I think it's green) to what I'll call the "free" system. It's not really free--there are some fairly heavy co-pays to discourage overuse--and it's not really good--somewhere between the VA and a really bad HMO in US terms--but it is universal. Unlike NHS or Canadacare, which try to be comprehensive but inevitably fail, necessitating quotas and queues (and, yes, some of those effectively become death squads), the French free system is intentionally designed to force quotas and queues in order to hit a cost number.
When you get quotaed out and forced to the queue, that's when elective care comes in. You can wait on your quota slot to come up. Or you can go to the "pay" side and pay a private doc to do it today. Or you can buy private insurance that covers access to the pay side when you need it; coverage tends to be cheap, primarily because this is a very competitive market and it's basically supplemental coverage. Or your employer can provide private insurance (and the vast majority do, in order to get injured workers back on the job quicker). Or you can pay extra for a Cadillac version of private insurance that doesn't require you to go through the "free" side gatekeeper. I don't think the French have medical savings accounts, but they would work well with this model. My experience with their "pay" side is that it works like ours, it is as good as ours, and the pay side docs make very good money.
Over 90% of the French have private insurance; they don't want to get stuck in the free system. That's considerably higher than our percentage. And remember, they have universal "free" care, we don't. And their government spends about half as much per capita on health care as ours does. The administrative costs under this system are very low. Because they are a civil law jurisdiction, they simply don't have the same jackpot jury awards and resulting malpractice costs that we do. They are currently experiencing some controversy between those who would like to see the basic coverage expanded to something like NHS or Canadacare and those who want to keep a lid on costs. There is a strong national disdain for "socialized medicine," so the cost controllers will probably win in the end.
Why would this approach not work here?
It's actually less government involvement--and much less government cost--than we have now.
(This post was last modified: 09-05-2009 09:22 PM by Owl 69/70/75.)
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