April 07, 2004
New Ideas on Healthcare Reform
On Sunday April 4, 2004 Ted Halstead appeared on CSPAN’s Book TV speaking about a book he edited called The Real State of the Union. He brought up some new ideas on how to fix a range of America’s problems that go beyond the ideas brought up by the left and the right. His ideas regarding our health care system were particularly interesting and creative. Here are some of the ideas that Halstead spoke about:
• We must dislodge health insurance from employment. If you were told that if you changed your job, your car insurance would have to change, you would think that was ridiculous. Why is health insurance any different? It is an accident of history that health insurance is tied to employment: During WWII there was a freeze on wage increases to stymie inflation, so employers gave out health insurance to entice new employees. This may seem like a trivial issue, however if insurance companies were concerned with keeping its subscribers for the long hall, they would focus on long-term health.
• Instead of having “universal health care,” make health care mandatory, like it is for car insurance. This would bring people in their 20s back into the system (30% of whom do not have coverage). These are the people you want paying for insurance because they are relatively healthy and their premiums pay for the care of older people. Also, this would alleviate the problem of poor people relying strictly upon the emergency care system for their health care. This raises health care costs for everyone because emergency rooms cannot deny service to someone who has no insurance, and many of these visits could have easily been prevented months or years earlier at much less cost. I believe this would also foster the creation of more low-frills insurance, created to cater to this new market.
• Halstead favors of tort reform, but only in context of insurance reform and the above ideas.
Personally, I don’t believe that these ideas go far enough. We as a country must take responsibility for our own health. We are the fattest and most sedentary country in the world. We then punish those who eat healthy and exercise by not charging the overweight and sedentary more for health insurance. My extraordinarily healthy family of three in Rhode Island pays $900 a month for health insurance. None of us are overweight, smoke or have any preexisting health conditions. That is more than rent or a mortgage! The administrative costs of these insurance companies are out of control because they are not forced to streamline because of competition like most businesses. Instead, it is in their interest to keep administrative costs high by creating bureaucratic behemoths, which keep payouts to doctor’s low, keeping more money in house. In my state of Rhode Island, it is a lack of capitalism that is the reason for high cost. During the 80's the state, in its infinite wisdom, allowed Blue Cross to become a not-for-profit company, exempting it from many state laws. During the 90's Blue Cross exploited this advantage and drove out the competing companies. Now we are left with a choice between two companies, and the consumer gets railroaded by 20% a year increases in premiums.
Posted by Miguel at April 7, 2004 02:30 PM | TrackBack (1)Miguel, you miss the more fundamental point in my opinion. In a capitalist democracy, the history of Blue Cross taking advantage to squeeze out competition is in fact capitalism at its finest. To the most competitive go the spoils. Because it is a democracy which permits money and lobbyists from capitalists to influence policy, is it any wonder that this system follows too the rules of capitalism which promotes competing other lobbyists out of the picture for favorable legislation for your own industry, corporation, etc.
It is precisely because capitalism targets those with disposeable income for making their product or service marketable, 44 million Americans without disposeable income for health insurance have been priced out of it. Rent first, transportation second, phone and food, requirements for work and sustenance third, a little for the kids in school, taxes and rising gas prices and guess what, 44 million can’t afford it, a majority of those are dependents.
This is competition at its finest, achieve the status of monopoly, oligopoly or shared monopoly, and a corporation can charge whatever the market will bear while maximizing profitability. What is missing from this good ole’ conservative love for capitalism? The 44 million who don’t make enough income to afford the price which the rest of the market will bear while maximizing profits for providers.
Unfettered capitalism leads to monopolistic goals and behavior and cannot, and will not include social ethics, social responsibility, nor any consideration for humane treatment of consumers except as such issues can be used to increase market share and marketability designed to maximize profit.
In a nutshell, capitalism has no social concscience, never did have, and never will have. It is simply not in the profit equation except as a profit increasing ploy.
The finest and most detailed examination of social obligation and capitalism as interdependent necessities for a healthy society was written by Adam Smith in his TWO BOOKS, The Theory of Moral Sentiments and The Wealth of Nations. Regrettably, conservatives love to quote cliff notes about Wealth of Nations (few have ever read it) and almost none have ever read the precursor, Theory of Moral Sentiment, which lays out the other half of the equation for a healthy society - a social conscience developed through history, tradition, culture, and yes, Government Intervention if necessary.
Posted by: David R Remer at April 7, 2004 10:35 PMDavid you make an excelent point, in reguards to the insurance companies going after those with disposable incomes, becase as bank robbers say “that is where the money is.” However, the blue cross situation in RI is more complex than I wanted to go into. There used to be 5 insurance companies in RI, competition was feirce, then the state got into bed with Blue Cross, allowing them to gain an UNFAIR compeditive advantage in the market place, slashing their prices and driving out the competition. Competition between the insurance companies kept premiums down, only when the state intervened out of seemingly altruistic motivations, because they thought that their beloved blue cross was underseige did they foolishly give them this advantage. What RI did was to dismantle the marketplace. Given the advantage the it has new companies are not willing to enter the marketplace and that is plainly un-capitalist.
This I believe was not the thrux to either of our arguments. I just wanted to introduce some interesting ideas I had heard and wondered what my fellow bloggers thought about them.
A question somewhat off topic: have you read Sen´s Democracy as freedom?
Posted by: Miguel at April 7, 2004 11:40 PMTerry,
Please!
that is ridiculous and inappropriate.
btw, the DNC Chairman’s name is Terry McAuliffe
With A capitalized and an e at the end
