Health Care Should Be Just Another Public Service
Just a few more Colorado Health Insurance Insider thoughts on Michael Moore’s Sicko… One thing that struck me in the movie was when Moore pointed out that the US already has lots of public “socialized” systems, including firefighters and public education. I doubt that many people like the idea of having firefighting services that have to be purchased the way we buy health insurance policies. It would suck to have your house on fire, call 911, and have the dispatcher look up your information and find out that you’re behind on your fire premiums. Oops, guess you better get out the garden hose.
And what about public education? In the late 90s, I was a high school math teacher with the Peace Corps in Tanzania. The majority of Tanzanian children attend primary school, for at least a few years, because the schools are mostly run by the government and are free (although parents did have to buy uniforms and supplies and in some cases pay small fees). But that all changed at 8th grade. The students in my classes (the equivalent of grades 9 - 12 here in the US) ranged in age from 14 to 24. The oldest were the ones who could only afford to attend secondary school for a year at a time, having to take a year or two off in between to earn money to pay the next year’s school fees. Very few Tanzanians attend secondary school. It is not free, and the school fees are very high in comparison with annual incomes. I can’t imagine that here in America we would rather have a similar system, with most of our citizens leaving school at or before 8th grade. We seem to like our free public education very much. And people don’t go around talking about how scary “socialized education” is. Instead, we realize that it is an asset to the country and a good use of tax dollars.
Police, firefighters, teachers - they all perform valuable public service that is paid for by most of us in the form of taxes, and benefits most of us in various ways over the course of our lives. So why is it such a stretch to imagine health care being provided in the same way? We don’t require that people have law enforcement insurance in order to call for help if someone breaks into their home. We don’t ask people to pay education premiums in order to send their children to public schools. So why do we require Americans to have private health insurance in order to realistically have access to quality health care?
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The effort needs to be a blend of the current system and a public system. Milton Friedman, one of the greatest economists of all time, showed how public schools became more efficient and graduation rates increased when parents were allowed to direct their tax dollars between a public school and a private school. Both schools improved as a result of competition. Removing competition invariably results in inefficiency. Ask the Canadians that experience aggregious taxation while waiting months for services rendered within weeks in the states. Ask them why they come to the states for many treatments. Ask them why many of the better doctors flee to the states. Currently in England, an example of a large, single-payer system, many dentists are refusing to accept government payment and providing service for only private pay patients.
Medicare, the “single-payer” system touted by proponents of a government system, is threatened by underfunding while only covering rougly 53M citizens. Of those, 9M are serviced by the large, private insurers. Early government estimates indicate the Medicare serviced portion lost $60B (the B is not a typo) to fraudulent charges. That is efficient? That is a disaster. Expand the program to 260M+ and it will easily clear $100B - with no profit incentive to increase efficiency. Where are the cries to fix this problem? In the private world, someone understands the ROI of spending a few million, or even a billion, to try and recoup/stop $60B of losses. For the government, it is someone else’s money. Most of those running the government aren’t even qualified to run a large company - much less the largest company in the world; the US government.
One final thought. The government regulates utilities. Yet due to free market influence, one of the largest health insurers, WellPoint, operates on a LOWER profit margin. Most of their money is made throug volume. WellPoint has over 35M members. Additionally insurance makes up on 5% of the US spend on healthcare; however they make a good target. How about the providers? Ever asked your provider why they would charge you 200-300% more if you didn’t have insurance? Perhaps that piece (30-40% of spend) warrants a look. Perhaps the fact that we expect an individual to go into debt $100K+ to become a doctor (followed by 90+hrs/week for 4-5 years on lower middle class wage) should be reviewed.
Many options need to be reviewed, and everyone should receive care. It just shouldn’t be limited to government.
Even the obviously biased Council on Affordable Health Insurance tackled the claim that”
“overhead for Medicare,” says Dr. Stephen Rous of Brown University, a single-payer advocate, “is 1 percent to 2 percent. The overhead for various private insurance plans (HMOs, etc.) is 15 percent to 25 percent.”
… and still came up with a much lower amount for Medicare, 5.2 percent, than the stated 15-25% for private insurers………
For an interesting discussion on the Denver Rocky Mountain News editorial, visit The Health Care Blog:
http://www.thehealthcareblog.com/the_health_care_blog/2007/02/policy_not_so_f.html
The 13% for Medicare is still lower than the 15-25% for private insurers in the article. Especially since Medicare is covering the higher cost over 65 age group and under 65 patients with expensive enough treatments, like dialysis, that private insurers aren’t covering.
I like the Denver Rocky Mountain News article because I think it pokes holes in the free market argument that a government system would be a bumbling, inefficient bureaucracy.
If a single-payer system would be able to utilize the enormous economies of scale you point out, insure everyone who files taxes, and still be able run equally efficient as current private health insurers, I think that would generate enormous political momentum. A single-payer system would also eliminate the cost shifting of larger emergency type visits from the uninsured and provide a more efficient system of catching those conditions before they develop into large claims.
As far as tax money going to private schools, that is a violation of the constitution if it is a religious school, which most of them currently are. If parents want their kids to learn “god did it” as an acceptable answer to a science problem, they can pay for the tuition to a tax exempt religious organization to teach them such. The defunding of our public school system and constant pressure to teach religion in science class is causing our kids to fall way behind other countries in science education. More of them may be graduating, but that is because the standards are lower.
If I want to golf somewhere, I can go to the municipal golf course. But if my religious beliefs say that each teebox must have a large gold statue of my God on it, I wouldn’t expect the government to direct tax dollars into the funding of those golf courses. I would just complain about those sinful secular golf courses and how anybody who tees off without a gold statue of our God on the teebox is going to hell.
As you have provided some reading, perhaps you should also do some. “Vouchers” to attend religious, private schools are in fact shifting of tax dollars and legal. However my argument does not pertain to religious schools as I am a firm believer in separation of church and state. Try some of Friedman’s works. The results are undeniable. The same principals apply everywhere government is involved. Why can FedEx or UPS, without the backing of the US government, get a package anywhere in the world (much less the country) more quickly and cost efficiently than the USPS? As a single payer system, why does the US military seem to lack finesse in negotiations? Why are there regular reports of how much the US goverment overpays for services? Why are local governments working to outsource certain functions - although public outcry has slowed the pace. Of course those fighting the change also complain about new taxes to cover spread. Government and efficiency do not in any instance belong in the same discussion.
With regard to overhead…is fraud part of the equation? Given $60B spread over 45M members is $1300 per member, each member would need to incur at least $13K of claims expense to just meet 10%. I suspect fraud is conveniently left out of the equation - not to say private insurers to not lose their fair share.
Doctors/hospitals already complain about lower reimbursement. If a single payer pushes reimbursement down further, what will that do to the labor force? Doesn’t a nursing shortage already exist? Isn’t a negative trend in the number of GPs become apparent as the Boomers retire? Both are blamed largely on inadequate pay.
Again I don’t disagree the government has some part in the solution. I do disagree anytime the government is the solution. That is an awful lot of power for one agency to wield. Name a country where it works. In case outcomes come into play, lets put it on the table that negative outcomes in the US are greatly facilitated by the fact that we are the most overweight country. Good luck finding a study that refutes the weight of the population as a major factor in the over health of the nation.
@Ryan
You are 100% correct. As long as the voucher program can stay clear of religious schools, it will keep its nose clean and probably become a popular program. And it definitely would create a competitive environment where schools could prosper.
And yes, the fact that our nation is so obese is a huge cause for the problem with our health care system.
A lot of good points made here. I made a post a while ago about the correlation between obesity and our rising healthcare costs…
http://www.healthinsurancecolorado.net/blog1/2006/10/20/cost-health-insurance-rising-fast/
I think we’ve made a lot more on that topic, but that is one of my favorite posts. Thanks for making some good points Ryan.