Let’s Settle this Damn Thing
By Patrick F. Cannon
I am not an economist, nor really an expert on anything except perhaps Chicago architecture, the Thoroughbred horse and the history of everything. So, the economics of health care are beyond me. I do know, however, that we are currently in one hell of a mess and it looks to get even worse.
What we’re faced with is this: a deeply flawed health care system is about the be replaced with another deeply flawed health care system, which – if the Republicans lose control of Congress as they surely will someday – will be replaced with yet another deeply flawed system, and so on and so on and…
So-called Obamacare was cobbled together to include insurance companies as the actual providers. Most of them soon found that they couldn’t afford to stay in the program without either raising premiums to unacceptable levels or losing money, so they began opting out (a significant number of counties have only one provider, and a growing number, none). Many of the young and healthy decided it was cheaper to pay the penalty than the high premiums, so they rolled the dice and sat out, thus sticking the insurers with both an older population and those with existing conditions. (Medicaid is another expensive piece of the program.)
Although anathema to most on the right, including me until recently, I see no way out of this mess without a single payer system based on the Medicare or similar model. Now, Medicare pays about 80 percent of health care costs, including annual physicals. For seniors with no income other than Social Security, it gives them immunity from catastrophic illness costs. My wife and I also have supplemental insurance that pays the balance, as well as prescription drug coverage. Our out of pocket costs for all of this runs about $10,000 a year.
Before we retired and no longer had to pay it, our Federal payroll tax included a 1.5 percent charge for Medicare, matched by the employer. What if this tax, which everyone pays regardless of income, were doubled? Would six percent of the total income of every working American pay for universal health care? I have no idea, but isn’t it worth exploring? If it could, we could eliminate Medicare and Medicaid and have one health care system for all Americans.
Many are going to immediately scream “socialized medicine!” With their undoubted talent for euphemisms, I give Congress permission to instead call it “The People’s Incredible Medical Plan” with no credit to me required. By the way, if religious and other non-profits were taken out of the equation, then they wouldn’t have to agonize over paying for birth control and other services which they oppose. Let Congress decide whether the plan pays for birth control; for abortions; and so-called “gender reassignment” and cosmetic surgery. In my view, the answers would be “yes”, “maybe” in rare cases, “no” and “only” to repair the results of accidents and congenital disfigurements.
A little personal history. My parents never had health insurance. When someone got sick, they went to see the doc and he got paid directly, likely in cash. By the time I got my first real job (1956), employer-paid health insurance was more common. As it happens, until I retired from the daily grind in 2001, every one of my employers provided health insurance through Blue Cross/Blue Shield. Toward the end, however, increasing costs led them to charge me a portion of the premium as a payroll deduction. Now, of course, I have Medicare, with a supplement through – you guessed it – Blue Cross/Blue Shield.
The United States spends about $10,000 per person per year for health care, by far the highest in the world. For this, we get what many people will call the best health care system in the world (for those who can afford it). And it’s certainly true that most of the advances in health care, including miracle drugs, have originated here. But are these benefits shared by the entire population? Our life expectancy for both sexes is currently 79.6 years; in both Canada (82.2) and the UK (81.2), people live longer.
Finally, let me throw this into the mix. The average tax burden for all developed countries is about 34 percent. The Danes and French pay nearly 50 percent, and the Mexicans, 15 percent. The Canadians and Brits pay 32 percent. Our average – and that includes Federal, state and local taxes – is 26 percent. I get the argument that every dollar that goes to taxes is a dollar that is lost to the real economy. But I also think that getting rid of all the middle men that clutter our current health care system might not result in increasing our 26 percent much beyond what our neighbors to the north pay.
As I see it, the alternative to national Medicare is a patched together system that still won’t cover everyone, and whose costs will continue to skyrocket. Maybe someone has a better answer, but I haven’t seen or heard of it. Have you?
Copyright 2017, Patrick F. Cannon
5 thoughts on “Let’s Settle this Damn Thing”
This makes more sense than anything else that’s being proposed.
I confess to be as perplexed by the health care issue as anyone. Maybe more so. I never thought Obamacare would work. It didn’t. But the flawed legislation lives on thanks to the expansion of Medicaid, which has many states hooked on Federal subsidies they are now loath to give up. (Indiana is one of them but was able to set up its own program, which gives it more local control.)
The single payer option, or some variation thereof, is compelling. It would seem to at least solve the political problem but I’m not sure it would improve actual medical care. It would be very very expensive. Several states have tried to do it, most recently California, but all have failed because of the enormous costs. Neither Medicaid nor Medicare cover all expenses. Many doctors won’t accept it (we’ve run into this with Medicare) and when they do, it provides them with only minimal reimbursement. Good thing we have a supplemental plan (BCBS!). It also generates a ton of paperwork, red tape, and administrative costs. A controlled study showed that patients on Medicaid actually had worse health outcomes than those with no insurance at all.
When we were last in Italy i had to see a doctor for a respiratory infection. I had a choice between the public hospital or a private clinic. At the former, care probably would have been free, but I would have had to spend the entire day waiting to see a doctor. I chose the private clinic, saw a specialist right away, got a prescription and paid cash (about 100 euros). I imagine we will see more of this type of two-tier system here.
I’m not a big fan of medical programs (or most anything for that matter) run by the Federal government. Just think about the VA. So I guess I favor not a single payer but multiple options. Realistically, we will never get away from health care as an entitlement. I have no idea what our solons in Congress will now devise, but I hope it will foster a stable private market of insurers and care providers with competition, innovation and plenty of patient choice. Let there be some safety net, with enforced eligibility requirements, for the many people who are priced out of the system. Right now, after Obamacare, our premiums have been going up and up even as it takes longer and longer to get an appointment with a doctor. We need more supply to meet the demand, and bring down costs. Only a private market can do that.
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Complicated, isn’t it? I wish I could trust our reps to come up with a logical system, but their record doesn’t give one hope!
Yes it is and no it does. Let’s be grateful the government has only a small footprint in the food market.
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