Guest Column (11/5/09)

What to do with health care

Nov. 5, 2009

By Stewart Cohen

There have been many criticisms of the current efforts toward health insurance reform from both the right and the left that deserve scrutiny.

The conservatives have argued that government involvement will lead us away from free market capitalism toward a socialized system. We already have one “socialized” program called Medicare, yet there has not been a huge outcry to dismantle it. Nor has there been a right-wing campaign for the dissolution of fire departments, police departments and public schools, which are paid for by the public and serve everyone. We don’t really want a competitive free market for these essential and indispensible services.

We need literacy for a democracy, so we have public schools. We need order and unbiased protection for our community, so we have a police department. We need to know that a fire will be put out when a house is burning, lest all our houses burn, so we have a public fire department.

In fact, the one thing we don’t hear anyone proposing is a true free market health care system. The closest we’ve heard is better competition between insurance companies, which supposedly happened in the 1980s. Perhaps we ought to look at what a free market health care system would bring to the table to see if it could help us.

In a free market, physicians would provide services for patients who paid for them. There would be no middleman setting prices and determining what services are covered. An interesting phenomenon could occur: People would probably only pay for services that maintained real value for them.

People would do lots more research to determine what treatments and tests are effective before investing in them, and would not stick with ineffective treatments just because someone else was footing the bill. Medical choices would be based on results rather than which organizations lobbied most successfully for coverage for their services in insurance plans. There would be no charge for the middleman (currently over 30 percent of the bill) and the prices of procedures and drugs would drop to be in line with their value and affordability to the consumer, yet many high cost procedures would be out of reach of all but the wealthy. The government would have a role in professional regulation and prevention of fraud, but not in pricing.

The objection that most people have to a free health care market is that they want some kind of bankruptcy protection and current prices of services and medicines are very high. The current employer-based insurance system has kept prices high and shielded them from the true costs of health care services. Most people are used to having someone else foot the bill for their care, yet they don’t want to foot the bill for someone else’s care through taxes, even though they are already doing so through their premiums.

Criticisms from the left focus on the belief that it is time for universal health care. It is important to note that the cost of doing this would depend on determining just what constitutes health care. Does it constitute life saving measures, health promoting measures or both? Answering those questions would go a long way to determining the true cost of covering everybody. That should be compared to the current cost of health insurance, which is somewhere between 10 percent and 20 percent of the average income.

How much would it cost us in taxes? There would be a huge cut in overall costs simply from the reduction in bureaucracy at every level, from the payer to provider.

The advantage of a public system would be the access of health care to all, but the disadvantage is that price control and choice of services would be set by government mandate. It just might turn out that universal coverage may only be possible for basic, emergency or life-saving care, and many in-between levels of service would remain out-of-pocket expenses. There may be more fraud in a publicly administered system, but it is likely that that there is more greed in a privately administered system.

As far as the system we have now goes, it is clear that with for-profit insurers determining fee structures and covered services there is little market impact from patients or providers. Do we really trust insurance and pharmaceutical company executives to make the big decisions for us instead of our doctors, when their mandate is profit and not health?

Given all these factors and uncertainties about alternate systems, it is sometimes hard to speak with conviction. Yet we can certainly agree that the insurance-based system we have now is in reality a “selective collective.”

Until 2007, the government “played favorites” with health insurance by providing a tax deduction for health insurance as a business expense to companies, but not individuals. The playing field is still not level for individuals or small businesses buying insurance. Just because you have or can afford insurance now doesn’t mean you will in the future. You could join the ranks of the uninsured if you lose your job, become disabled or your insurance company decides you are too big a risk. You could become one of the 60 percent of personal bankruptcies caused by health problems.

The current efforts to regulate the insurance industry are perhaps the least we can do to begin to create some equity and protect patient’s access to care. If you think the system is working for you, look around and see how many people it’s not working for. Think about how you depend on them — for their business, companionship, services or inspiration — and ask yourself if their house burned down, would yours be safe?


Stewart Cohen is a Williston resident.