That’s The Point!
In the health care reform debate, much of the opposition seems to be forming around the so-called “public option”, the idea that people should have the choice of a public or private insurance plan. It was precisely this aspect that made Hillary Clinton’s plan superior during the election period. The New York Times spells out the problem:
“But critics argue that with low administrative costs and no need to produce profits, a public plan will start with an unfair pricing advantage. They say that if a public plan is allowed to pay doctors and hospitals at levels comparable to Medicare’s, which are substantially below commercial insurance rates, it could set premiums so low it would quickly consume the market.”
But isn’t that exactly the point? Indeed, it is precisely why single-payer systems work so well– they cut out the middle-man, and take out the profit motive from health care. Combining a universal mandate with community rating means that insurance premiums become affordable and everybody gets covered. And no, there need not be long waiting lists and you get to choose your own doctor (it seems to be far easier to get same-day doctor’s appointments in single-payer countries, and they often even do house visits!). Right now, the insurance companies spend $50 billion a year trying to deny coverage. This is not an ideological point. If the private insurance companies started offering decent affordable coverage, and stopped excluding people, then fine. Until then, give people the power to choose.
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It baffles me the conservatives can say this stuff with a straight face. I think some compromises will need to be made along the way, but I feel at last we will be seeing success in our long struggle for universal health care. Kennedy is expecting to be back in Washington late this week and should have his bill passed out of committee this month.
That is an odd argument. One wonders who these unnamed “critics” are exactly. Anyway, I think the more pressing question on the matter of the so-called ‘public option’ was posed by Greg Mankiw:
If the problem with American health care is that all those nasty profits and high administrative costs are eating up all the money, then it should be easy for a public plan to be self-financed. Yet this does not seem to be what the Obama administration is proposing to do.
Two points:
More government control is not the answer. Not in this country at this time.
Universal health care is NOT effective. Have a look at Canada and the rest of the list of countries that have tried it. No thanks.
Our health care system is far from perfect, but it will become even farther from it if Obama is able to carry out what he wishes.
I assume it will eventually become much like another public/private choice area – schooling.
Those who can afford it will get better care while subsidizing lower level care for others. Not that that would necessarilybe such a bad thing – at least everyone would be getting some care.
I suspect what would happen is that the lower end care would be heavily public skewed (routine exams, minor injuries, etc.) and higher end would be skewed to private (surgery, Ob, etc.). Again, not sure that is necessarily a bad thing.
Mankiw is being a little disingenious. The issue is the cost of health care to each individual, not whether it is on the government or the household or the corporate balance sheet. Sure, the government has some advantages over private insurers– it can use its monopsony power to bargain down prices. More fundamentally, it takes the profit out of health care. The Commonwealth Fudn estimates that the public option would be 20-30 percent cheaper than the traditional privaet option.
Sure, the government has some advantages over private insurers– it can use its monopsony power to bargain down prices. More fundamentally, it takes the profit out of health care. The Commonwealth Fudn estimates that the public option would be 20-30 percent cheaper than the traditional privaet option.
If that’s true, then it should be no problem for the program to be self-financed, and there shouldn’t be a need to use taxpayer dollars to support it.
Pilgrim,
You’re a little late to this debate. I advise you to look up the history here under “health care”. One of the frustrating things about the US debate is that points like yours are made all the time as if they are pellucid, when in fact they are fallacious. You are speaking ideology, not fact.
It is fact that the US spends twice as much on health care than comparator countries, and has less to show for it it terms of health care outcomes. It is a fact that 47 million have no insurance, and an equally large number are underinsured. What else? Waiting lists need not be any longer. Of course, if you do it on the cheap, then you can ration by time, not cost. But in places like France and Germany, there is no waiting. Aside from the rationing by cost alluded to, Americans also face intense rationing by time. Even with good insurance, it’s exceedingly difficult to see a doctor at short notice here (hence the reliance on the ER…). And single payer countries tend to put a premium on cost-effective primary care. Did I miss anything?
It is a fact that 47 million have no insurance, and an equally large number are underinsured.
I think I asked this before but didn’t get a response: what is your source on the number of underinsured?
Indeed, it is precisely why single-payer systems work so well– they cut out the middle-man, and take out the profit motive from health care.
I’m not sure this is the case. $50B on the health care scale is certainly up there, but if we were to get rid of that much spending tomorrow, we wouldn’t wake up and say, “Health care is now affordable.”
As for solutions, I’m not really sure at this point. People on both sides tend to think there are incentive issues. I tend to think there is more an agency problem. As unpopular as this sounds, too many decisions are made by the patient. Our hospitals are too advanced. Many of our clinics are better than 3rd world hospitals. This isn’t to claim we should aspire toward 3rd world standards. A 3-day stay in the hospital shouldn’t be $4-6K though. Our “walk-in” clinics are little more than e.r’s with closing times and no trauma units. And to think we just finished closing these in rural areas only to bring them back.
Well Pilgrim, I for one say “Heck yeah!”
The problem with single payer is that it wouldn’t be too long before medical professionals would lose the right to conscientious objection.
The bottom like is that solving the healthcare crisis is not worth the potential cost of driving good people out of the practice of medicine. my family doctor would rather go to jail than prescibe contraceptives. I can’t imagine he would be alowed to continue practicing medicine under a single payer plan.
OTOH, Ben – If a pro-lifer gets elected president, he can see to it that that no abortions should be performed, thus immediately reducing the abortion rate. Two-edged sword, to be sure.
No profit motive for medical care?
Oh, because everyone will work so hard to take such great care of us out of the kindness of their hearts.
That’s how things work the rest of the world over, no?
Zach – as opposed to the enlightened kindness of businessmen?? Ever work for a used car dealer?
Ben,
You noted earlier that “The problem with single payer is that it wouldn’t be too long before medical professionals would lose the right to conscientious objection.”
I think you are correct on one hand, namely that conscientious object is a right. But, as a right can it really be taken away? I think there could be a time when Objection has a cost, but as we can see in the WWII CO’s, a constitutional democracy protects two things…the minority and the ability to dissent.
Standing up in the name of truth doesn’t mean that the dominant society will listen. Its what some of call “Counting the Cost”.
Yeah I know it is “counting the cost”…That’s why I said single payer wouldn’t be worth the cost.
What does the identify of the insurer have to do with conscientious objection?
I love bringing good news.
BA, if your only objection to a public option is that you would not want it to have a government subsidy, I have good news. The Administration and the Democrats are not proposing the public plan recieve any premium subsidy not available to private sector plans. Hoepfully, with this, we can welcome you on board teh Administration’s efforts.
Ben, good news for you also. We have an actually existing single payer system for the elderly and disabled (its called ‘Medicare’). Doctors have not been forced to prescribe contraceptives against their judgment. So again, problem solved.
BA, if your only objection to a public option is that you would not want it to have a government subsidy, I have good news. The Administration and the Democrats are not proposing the public plan recieve any premium subsidy not available to private sector plans.
If that were really true then I’d say bring it on. I gather, though, from this Ezra Klein piece that it’s not.
Where are you reading that in Klein’s article?
He mentions a “weak public plan”, which is clearly the proposal I’ve seen from the House Democrats and Klein states it will not have government subsidies. He then speaks of a “strong public plan” though doesn’t mention any premium subsidies and notes Senator Kennedy’s plan is a variant of a strong public plan.
I guess I can see from Klein’s lenghthy article you might strain out a question as to if Kennedy’s plan has a public plan with a special premium subsidy but I’ve waded through all 167 pages of Kennedy’s proposal and can’t find a special premium subsidy in the public plan. (I’ll email it to you if you would like).
Matt says: If a pro-lifer gets elected president, he can see to it that that no abortions …
Sorry Matt, abortion is legal in the US, even justice Scalia says it is the law. A prolife president cannot just stop abortions.
Couldn’t he just say that abortions are legal but no longer covered, Dr. Dale?
Matt, I wish he could but then if it’s legal why isn’t it covered? Exposes the government to legal challenges and lawsuits. IMHO, we can’t outlaw abortion anymore than we can outlaw other sins, porn and other social ills. We can try to make abortion extinct by changing hearts.