Friday, July 06, 2007

Health Care vs. Health Insurance

The New York Times writes, “There is no better measure of the power of the health care issue than this: Sixteen months before Election Day, presidential candidates in both parties are promising to overhaul the system and cover more — if not all — of the 44.8 million people without insurance.” It goes on to discuss Edwards' and Obama's proposals, as well as the non-proposals of Giuliani and other Republican candidates.


It seems that the new reform idea is to do nationally what Massachusetts did: require that everyone have health insurance, like everyone is required to have auto insurance, and give government subsidies to the poor who can't afford to do that (since it's ridiculous to assume that there's a bunch of lazy people out there who just haven't bought health insurance even though they have the money to do so). The number of uninsured and underinsured people and the rising cost of health care are certainly large problems, but this doesn't address everything. While these usually complex and comprehensive plans achieve universality, and perhaps cut down costs, they don't solve the problem of private health insurance companies denying people's claims.

This is major theme in Michael Moore's new documentary "Sicko," which I advise everyone to see. What's the use in having insurance if they can ultimately deny you care? The only way to solve that problem is to take private insurance companies out of the equation and eliminate the for-profit system we have now where the economic incentive is to deny people care.

In Paul Krugman's excellent article "The Health Care Crisis and What to Do About It," he notes that even liberal economists and scholars at progressive think-tanks argue aganst a national health insurance program often using erroneous claims that it stifles innovation. But, of course, what they really are afraid of is the political battle that would ensue. Everyone knows what happened to "HillaryCare." But that had unique problems of its own.

There's some moveoment in the House, but outside of third tier candidates Dennis Kucinich and Mike Gravel, no Democratic presidential candidate is standing up for a single-payer system. Their reform proposals would be better than what we have now certainly, but the fact is that it's not a good enough solution. We will just have to tackle reform again anyway.

UPDATE: More Americans going abroad for cheaper health care.

2 comments:

Alexander Wolfe said...

Agreed.

Anonymous said...

Another blog post titled "Health Care vs. Health Insurance" suggests that people in countries where the government is the "single payer," people do not get good care, either:
http://tinyurl.com/2s5nyv

I find it disappointing that few people address government policies that make health insurance and health care so expensive. For example: (1) the tax-exemption for employer-provided coverage and (2) mandated benefits.

The tax exemption encourages people to buy more comprehensive plans than they otherwise would. The RAND Health Insurance Experiment shows that people with such plans consume much more health care services w/ negligible benefit on health.

People generally over-consume when spending someone else's money, and the tax exemption penalizes spending one's own money on health care in favor of having a comprehensive employer-provided insurance plan.

Another consequence is that insurers can afford to be unresponsive to your dissatisfaction, as they know you must quit your job to change providers.

I don't see why "single payer" would improve things, as you'd have to leave the state or country to change your insurance company.

The mandates increase the cost of insurance policies by between 20 and 50%, according to the Council for Affordable Health Insurance. This is like forcing everyone to shop at Whole Foods and wondering why people can't afford groceries.

Also, re. administrative costs for insurance companies vs. Medicare, the article "Medicare’s Hidden Administrative Costs" is eye-opening: http://tinyurl.com/3x3x2z