Universal Health Care in the US. Yea or Nea?

[Francesca R]

4) If the gov is so great at running health care, what would prevent the government from running everything? This creates a slippery slope with no end in site.

The government (in the UK) doesn't "run health care" because it isn't great at it. It bulk-buys it on behalf of the public. Medical professionals and business professionals run health care.

The actual government regulation of the economic activity that is health services is not (I don't think) any more pervasive and constricting in the UK than it is in the USA, although it is certainly a highly regulated business in both places.

You--like a whole bunch of people--mistake universal insurance for "running the business" and you are quite incorrect to do so. And if it is a straight toss-up between compulsion and choice in the realm of health insurance (not all insurance) then compulsion generally objectively wins in the sense of more efficient pricing.

You just have to swallow that some free markets fail and therefore vanish. Everyone in the USA implicitly should know this already, since it is why:

1) the vast majority of insurance is employer-provided and therefore purchased in bulk with, actually, more than a slight element of compulsion
2) If you go it alone you discover a stark absence of competitive market choices

 

[Rolfe]

I propose to ignore ServiceSoon. Anyone who jumps into a long thread with a post that basically says "I have the answer", when in fact he is merely ignorantly repeating points that have been shot down in flames several times already, isn't interested in a debate. And besides, several posters have already dealt with him.

I'd like, at this stage, to look more closely at the role of the insurance industry in universal healthcare. What's it for?

While we acknowledge that there are many different ways of delivering univeral healthcare, we all tend to argue from the position of the system we know best - our own. (Posters like ServiceSoon, on the other hand, tend to argue on the basis of a preposterous straw-man construct of universal coverage dreamed up entirely by their own paranoid fantasies, which bears no resemblance to anything that actually happens or is likely to happen in the real world.) I have been arguing on the assumption that universal healthcare is simply paid for out of taxes - and I see that Volatile is taking the same position.

In this system, insurance companies have no role in universal healthcare provision. (They still exist, to provide extra cover to those who want more than what is provided by the universal system, but if that system provides good, comprehensive coverage as the NHS does, then in practice only a small proportion of the population take out extra insurance. They mostly get a nicer room, better food, prettier nurses and non-urgent needs dealt with at a time that suits them better.)

The patient's experience of healthcare is, as a result, pretty much cash-free. You're sick? See your doctor, get treated. Apart from a small prescription tax paid to the pharmacist (and not even that if you're over 65 or live in Wales), that's it. Nobody needs to figure out how much you personally just cost the system, and nobody is interested in tagging your usage.

You need more? Your doctor arranges for you to see a consultant. You see him. You get treated. Rinse and repeat. Or you need an MRI scan, or lab tests? You get them. You need surgery? You get it. Nobody even mentions money. Nobody's interested. Nobody cares.

Of course hospitals do their own internal accounting, for good housekeeping. They know how much a hip replacement costs to do, and they know how many they do in a year. But nobody cares how much your hip replacement cost. You showed up needing the operation, and entitled to get it, you get it. End of story.

Now this seems to me to represent a massive cost saving in terms of pricing, billing, chasing the money and so on. It also means that the experience of being ill, for the patient, at least lacks any need even to think about money, where it's coming from, or who pays. Works for me.

But Blue Mountain has brought up a different proposal.

We are proposing the government take steps to ensure everyone has access to affordable health insurance and has a basic policy. I suspect the US would adopt a model similar to Germany's, where health insurance is private but there are regulations in place that make sure everyone can get (and has) insurance.

Is this a good system? In my view, the involvement of private insurance companies in universal healthcare provision is a colossal waste of resources. Tack on the collection of the "premiums" to tax collection as it is already administered, and give the money directly to the healthcare providers to meet the healthcare needs of the citizens. Cut out the insurance parasites, with their overheads and their profits. And cut out the extra hassle for both the patients and the healthcare providers in dealing with the insurance companies - premium collection, and the pricing and itemised billing of every individual's treatment.

I can see how it might be politically expedient to continue to involve insurance companies in healthcare provision when moving to a universal system. Not least when the insurance industry gets lobbying, and people start screaming about job losses.

But leaving that aside, is there any benefit? Why does Germany run things that way? What am I missing here?

Rolfe.

 

[DaN K. StAnLeY]

Okay, So I checked out this article from the AARP: http://www.aarpmagazine.org/health/health_care_costs.html

Maybe this could lower our per capita spending.

Indeed, perhaps the most significant reason Americans are drowning in health care debt may shock you: Americans are getting far too much unnecessary care. Of our total $2.3 trillion health care bill last year, a whopping $500 billion to $700 billion was spent on treatments, tests, and hospitalizations that did nothing to improve our health. Even worse, new evidence suggests that too much health care may actually be killing us. According to estimates by Elliott Fisher, M.D., a noted Dartmouth researcher, unnecessary care leads to the deaths of as many as 30,000 Medicare recipients annually.

So, give me some more time here and I just might wrap up this whole HC problem on JREF.

 

[DaN K. StAnLeY]

Or Shannon Brownlee will, whatever.

 

[Rolfe]

If health care is so expensive that people can't afford it then we have a responsibility to determine why.

Okay, So I checked out this article from the AARP: http://www.aarpmagazine.org/health/health_care_costs.html

Maybe this could lower our per capita spending.

[.... Quote from article about over-provision of healthcare....]

So, give me some more time here and I just might wrap up this whole HC problem on JREF.

Well, it's part of the problem, but it's not all of it. And addressing that, doesn't even begin to address the most fundamental problem, which is the discrepancy between the cost of the healthcare some individuals need and their personal ability to cover that cost.

Reducing the overall healthcare bill for the nation is an admirable objective. However, there are still going to be people - individuals - who actually do need hundreds of thousands of dollars worth of healthcare. To address ServiceSoon's point for a moment, the reason Joe Bloggs' healthcare is so expensive that he can't afford it is often that it simply is very expensive to treat certain diseases. You can cut out waste till you're blue in the face, but cancer treatment is still going to cost a lot.

If you retain a system where the amount each individual is expected to pay into the system is related to the perceived risk that they are going to need to take large amounts out, and not to their ability to pay, you are going to continue to struggle - in my opinion.

And if you're going to look at unnecessary expenditure in the healthcare system, I refer you back to my posts about the parasitic nature of the health insurance industry.

Rolfe.

 

[Rolfe]

Dan, could I ask if you've read my posts 543, 549 and 550 above?

Rolfe.

 

[Francesca R]

I'd like, at this stage, to look more closely at the role of the insurance industry in universal healthcare. What's it for? [ . . . ] I have been arguing on the assumption that universal healthcare is simply paid for out of taxes - and I see that Volatile is taking the same position.

In this system, insurance companies have no role in universal healthcare provision.

In the tax-based system that is the NHS, that's correct. But this is where the UK is different from much of Europe and Japan. France, Germany, Holland and Switzerland have universal provision but insurance-based cover. Some research indicates that this is one step ahead of the UK NHS and with that I do agree. The UK (also Australian) model remains considerably superior to the quasi-voluntary and non-universal insurance based cover in the USA.

The patient's experience of healthcare is, as a result, pretty much cash-free. [ . . . ] Now this seems to me to represent a massive cost saving in terms of pricing, billing, chasing the money and so on. It also means that the experience of being ill, for the patient, at least lacks any need even to think about money, where it's coming from, or who pays. Works for me.

I find it persuasive that the inferior incentive structure of "cash free" probably causes bigger efficiency losses from this system than the cost of administering insurance. Plus, it replaces that admin with different admin anyway (there is still billing and pricing and chasing of money)

But Blue Mountain has brought up a different proposal. Is this a good system?

In my view, it is superior to the UK's, yes.

Cut out the insurance parasites, with their overheads and their profits.

This sounds a bit like it's coming from a general anti-business stance and I would be interested in why all of the insurance business earns this charge. Why parasites? In short, what an insurance model does (relative to a tax-based one) is better align the incentives of patients and providers to further the interests of equal access to treatment, long term health, low cost, and as free as feasible from political considerations. And those are society's interests too. If an insurer can help that happen, earning a profit from it is economically and ethically smart and it is incorrect to call it parasitism.

I can see how it might be politically expedient to continue to involve insurance companies in healthcare provision when moving to a universal system. Not least when the insurance industry gets lobbying, and people start screaming about job losses.

Maybe. But it is a good idea aside from special interests, which are a hazard to all political decisions.

But leaving that aside, is there any benefit? Why does Germany run things that way? What am I missing here?

See above, I could expand on it time permitting.

 

[DaN K. StAnLeY]

"A classic experiment by Rand researchers from 1974 to 1982 found that people who had to pay almost all of their own medical bills spent 30 percent less on health care than those whose insurance covered all their costs, with little or no difference in health outcomes.

Thought that was interesting. However it was from wiki.

 

[Darat]

This is where I think the interesting discussion should be - what is the best model for providing universal health care and it's where I think it is not as black and white.

 

[Rolfe]

See above, I could expand on it time permitting.

I'd be interested in your expansion on it, most certainly.

No, I'm not anti-business or anti-insurance. I'm a vet. I'm intimately familiar with private medical provision, and with the role of insurance. I'm 100% in favour of pet healthcare insurance. And with home buildings and contents insurance, and with motoring insurance and travel insurance and so on. I even think voluntary healthcare insurance to provide additional cover over and above the universal provision is a great idea.

My use of the word parasites was perhaps a little strong, but this was in relation to the involvement of insurance in a situation which seems to me to be completely different from the above.

All of the above are risks which are expected to be met, ultimately, by the consumer. It's my responsibility to pay for my pet's medical treatment, or to rebuild my burned-down house, or repair my smashed car. The state has no role in helping me do that. So I turn to an insurance company, and quite right too.

However, if the state is mandating payment from every citizen to fund the healthcare system, and is basing the payment calculation on ability to pay rather than on perceived risk, what is the insurance company contributing to the proceedings?

I can see there are factors I'm not considering and not aware of, so I'd certainly be grateful for your explanation.

Rolfe.

 

[DaN K. StAnLeY]

Dan, could I ask if you've read my posts 543, 549 and 550 above?

Rolfe.

I actually missed 543 and am reading now, brb.

 

[Rolfe]

This is where I think the interesting discussion should be - what is the best model for providing universal health care and it's where I think it is not as black and white.

Exactly. If I were Barack Obama, that's what I'd be wrapping the cold towels round my forehead about.

1. What is the optimal model for the delivery of universal healthcare?
2. How do we get from here to there?
3. Can we actually do that, or will we be forced to adopt an inferior system due to political pressure and the sheer logistics of change?

Most of the other countries with universal provison have had it for some time. Britain introduced it at a good time, just after the upheaval of war when everything was in flux, and before the whole healthcare industry / insurance industry partnership had got to the point where it now is in the USA.

Obviously, they've left it late. It's going to be more complicated and more difficult. But leaving it even longer is only going to compound the problems. So, how to proceed?

2) We would need to be dedicated. The switch over won't happen over night, and changing any system so drastically will lead to short term problems. If elections come around ....

Well, yes. What system would be best, can you actually achieve it, and how do you achieve it? These are the interesting questions. However, I think any change which is even moderately well-managed will be so beneficial for such a large number of voters that voter pressure (as opposed to vested interest group pressure) is very unlikely to back reversion to the present system.

Rolfe.

 

[Francesca R]

[Pardon the snipping--intended to isolate one thread of thought from your post]:

I'm 100% in favour of [ . . . ] home buildings and contents insurance [ . . . ] It's my responsibility [ . . . ] to rebuild my burned-down house [ . . . ]The state has no role in helping me do that. So I turn to an insurance company, and quite right too.
[ . . . ]
My use of the word parasites was perhaps a little strong, but this was in relation to the involvement of insurance in a situation which seems to me to be completely different from the above. [ . . . because the state is paying]

I don't think that actually makes a difference.

You could get (for example) a state-provided/tax-funded fire-insurance premium (available to everyone) against your home being destroyed by fire, and then individually have the responsibility of buying a policy with it (shopping around multiple providers, spending more for more cover if you want to), but where insurers were obligated to provide at least a certain level of cover and if you didn't bother to choose one, the state would do it for you.

[Child Trust Funds are like this--you could consider them to be a type of "insurance" against children being chronically under-provided for as they reach adulthood--although the amount the state gives is very small. More than that, they are a "carrot-type" incentive to parents to voluntarily make more provision themselves, and an enabling mechanism to do that . . .]

However, if the state is mandating payment from every citizen to fund the healthcare system, and is basing the payment calculation on ability to pay rather than on perceived risk, what is the insurance company contributing to the proceedings?

The insurance company is (would be) competing against others to provide better service for less cost (source the provision of better health services for less anyway). In a universal system this is constrained by a minimum compulsory level of provision (and if you don't buy it, the state buys it for you from an approved provider). Perhaps a capped cost for that minimum too, although effective competition should make that superfluous. You get to choose from an array of insurer's offerings, and you can "top up" as you see fit, from the same or from another insurer.

By comparison, primary care trusts are providers as well as purchasers. Actually if they were just purchasers they would be too small to have enough bargaining power. And they don't actually compete with each other other than making some postcodes more attractive than others from a health point of view--which is a social bad (right?).

A criticism of giving patients any choice of provider/insurer is that patients are insufficiently informed to be legitimately empowered in healthcare matters, so decisions like that are better made on their behalf. Personally I think things have rather moved on rather a lot since 1948 in that regard and that individuals are considerably more knowledgable about their health--which is borne out by their evolving behavior (reduction in smoking, dietary, exercise)--and facilitated by increased ease of access to info/knowledge via modern participatory media. In this sense, an individual's health is much less of a "special case" than something else like--say--travel insurance. Though it remains a special case.

Then there are "anti-market" criticisms that argue that private for-profit groups have an incentive to defraud customers and/or hide information from them. This is true as far as it goes: profit interest is served by providing less and charging more, provided you can get away with it, but personally I don't think that carries the nefarious motive very far. The discipline of competition and the publicly accountable scrutiny of regulation work against market abuse like that. Moreover, other adverse incentives hamper the efficiency of state monopoly too. People have sacred cows on both sides of such debates and I don't particularly favour this thread getting into either.

But suffice it to say that if one believes that competition creates better (not perfect) incentive-compatible circumstances then competition among insurers are neither a waste nor an opening for deception. And I think you tacitly accept that for fire, motoring, travel and so on. So it comes down to what the reasons are that universal health provision can't tap into it. You only really raised the one, so you can respond about whether I addressed it.

 

[DaN K. StAnLeY]

Now Dan has in one post accused Europeans of being "lazy", because of this. I just wonder how long he's spent in Europe, and how many Europeans he knows. Dan, it's true that we work fewer hours a week than Americans, but that has absolutely bugger-all to do with having access to free health-care. It's to do with life-work balance, and the knowledge that we only get one life so we'd rather not spend all of it working.

I just don't get the concept that not having to worry about where our medical treatment is going to come from makes us worse people, or lazy, or freeloaders, or moochers. It just doesn't come into it. Oh, I ought to do a bit more overtime this weekend. But the hell with it, I know that I'm entitled to be treated no questions asked if I get appendicitis, so I'll just take the kids to the park instead! Why would that ever be anyone's line of thinking?

I don't really think you are lazy, even if I said it (don't think I did, but may have implied it). I may have acted sophomoric before, but it goes with the overall point I was going for. I think UHC would breed laziness in our system. I do realize the difference between the two programs, but let me just give you a simplified view of our entitlement programs.

If you decide you don't want to work in the US, you get foodstamps. Sure it's harder if you're a guy, but if you have a kid you're in. Then, since you qualify for foodstamps (and not just enough foodstamps for essentials, I personally know several people who will sell me their extra foodstamps for half price) because you decided not to work, you also qualify to walk next door and sign up for medicaid. Once you have your food free, and medical free, then it's only about a year to a year 1/2 wait before you get on housing and pay 20$ a month rent for your house. Why would anyone be a sucker and WORK in a system like that?

People only access healthcare when they're sick. They don't go out of their way to access healthcare they don't need, just to get something for nothing!

Are you sure? I have 500-700 billion dollars that say otherwise.

Remember, the universal systems treat everybody, including those you'd class as moochers,

C'mon now, you and I can both agree on who the moochers are by now.

But healthcare needs aren't predictable. Some people can go through life needing little healthcare. Others are dealt a rotten hand. Some people may need to spend only peanuts on healthcare, while others may literally die if they can't access treatment of a similar monetary value as the Beverley Hills mansion. Compounding this is the unfortunate fact that it is the very person who needs the large amount of resources who is likely to be in the worst position to make that sort of money.

I agree health isn't predictable to an extent, but if you are eating your way to the grave (as many do in America) then you know you are going to be more at risk. Your system punishes the people who live healthy lives so less responsible people can live more comfortably.

I don't totally agree with you that the person with less money is likely to be worse off. In America, someone living beyond their means may go into the hole in a lot of ways not related to health insurance (especially if we cut costs). Our country has a higher income per capita. It is no secret that with our extra money, we like to eat. We have way more people having heart attacks than the UK, and its because we over indulge. We work more and eat more fast food. There are a lot of reasons people who make more money would be worse of health wise.

I admire your work ethic, even if I feel you haven't explained your morals very well so far. (Apparent willingness to see those without resources abandoned to their fate isn't pretty, even if you later say that this isn't what you meant.)

My morals against taking something for nothing.

It's not moral that a work-shy layabout never gets sick even though he spends the cash he scams on beer and cigarettes. But it happens. It's not moral that a diligent hard-working technician gets systemic lupus. But it happens.

Can you even out these inequities? Can you redistribute fate so that the diligent and the deserving don't get sick? Of course you can't.

No, I can't redistribute. I'd prefer to try something much more simple. We lower cost, improve quality, and that should increase the number of people who can/will access health insurance. Doing the right thing, ain't always easy.

 

[Rolfe]

You could get (for example) ....

Thanks for that reply. I'm trying to see what you're getting at, though I'm not entirely buying it.

It seems to me that no matter where the actual money comes from, I'm going to end up seeing the same doctor. In one case because there's only one practice in the village, however if there was a choice then I'd be free to make it under the present system anyway. In the other case I certainly have a number of hospitals I might end up in - one of several hospitals in Edinburgh, Borders General or Wishaw General. But the choice will be made on a combination of which is the most convenient for me, and where the most appropriate service for my complaint is located. And that choice can be made freely under the present system anyway.

I can't see any practical system where there is duplication of healthcare provision, and you choose which doctor or hospital you go to according to which insurance company you choose. So the competition which exists between insurance companies would seem to me to involve only the service they provide - that is, how well they facilitate my choice of healthcare provider, and how well they pay out when I need them.

But at the moment I've got all the choice I realistically need or can have of actual doctor, hospital etc. And I don't feel I need or want to have to choose the insurance company that's best at paying out on my claims, when I'm used to just being able to show up with a healthcare need and get it seen to, with no question of payment arising.

I also note what you say about citizens buying minimum compulsory coverage, the price of which will be given to them if they can't afford it. This might suit the libertarians better, but does it fund the system adequately?

I'm assuming that your minimum compulsory coverage would give citizens the entitlement to the level of healthcare at present provided by the NHS. If it doesn't, then I'm certainly not happy with the idea, and would require a great deal of convincing that this was the right way to introduce rationing, as that would be the result. Thus, the "buying extra cover" would be much the same as choosing to take out a BUPA policy of some sort at the moment. Which not many people do.

So, does everybody pay the same premium for this standard cover? Or do premiums vary?

If everyone pays the same premium, this appears to be a form of poll tax, where the low-paid are disproportionately hammered, and the affluent scarcely notice the imposition. Trying to even this up by some sort of graduated means-tested relief on premiums seems unnecessarily complicated.

If the premiums vary, then on what basis do they vary? If it's like the US system, where premium is calculated on the basis of perceived risk, then I can't see how we're not back into the same problems we see with that system, only with the state picking up a lot of the tab. And again a lot more bureaucracy involved in the risk assessments and the collection of the variable premiums.

If on the other hand premiums vary according to ability to pay, then why are we calling them premiums? This is a tax, and why would it not be best collected along with the rest of the tax and cut out the middle man?

I realise you understand this in better detail than I do, but can you explain to someone who is currently benefiting from the NHS, what improvements I would see if an insurance-based system was used instead?

Rolfe.

 

[DaN K. StAnLeY]

Rolfe,
Sorry I took so long and I appreciate you continuing the debate as long as you have. I value everyones comments, but when you, Darat, and Franny are coming at me it feels like 30 people. LOL! I've never discussed this subject so in depth before and I can get a little overwhelmed by ya'll. Thanks for your patience.
-Damn Yankee

 

[Mitchell314]

Rolfe,
Sorry I took so long and I appreciate you continuing the debate as long as you have. I value everyones comments, but when you, Darat, and Franny are coming at me it feels like 30 people. LOL! I've never discussed this subject so in depth before and I can get a little overwhelmed by ya'll. Thanks for your patience.
-Damn Yankee

So long as you accept that the majority is always right.

 

[macdoc]

The discipline of competition and the publicly accountable scrutiny of regulation work against market abuse like that.

Pardon my laughter but that's why your banks are now ****ed.

Every other G8 nation has lower costs per capita, cover everyone and most have better outcomes.
Wake up - you in the US are being screwed royally.

Your "system" aka predator friendly zone" is a disaster and a your nation a laughingstock for allowing it.

 

[Francesca R]

Apart from being off-topic, the above poster has clearly not followed the thread nor been able to read the location of other posters (and it's not London Ontario either)

 

[DaN K. StAnLeY]

Wake up - you in the US are being screwed royally.

Well when we run out of wood and come knocking with our tanks, we'll just take ur health care too, ey?