Government

If you favor Medicare-for-all or a public option health care system, proceed with open eyes and realistic expectations 😷

Here’s an update on health care for all you fans of a single payer system. 

As I write this am on the Queen Mary 2 which as you may suspect, is populated with a large number of British citizens, over a thousand as a matter of fact. What a source for information? I’m in my glory talking to people about …. health care, retirement and social security. Today I ended up in a two hour conversation with a retired UK union leader.  The subject; health care in the U.K. πŸ€“

Here is what he told me. Workers pay 10% of their pay for health care and employers contribute more. And people think their health care is free because they pay nothing at the point of service.  

And here’s the thing, once you retire, it’s all free. You have no out-of-pocket costs and you pay no premiums. Soooo, you can use as much health care as you want …. if you can get it. Guess what happens as the retired population outweighs the rest of the population?

I asked about waiting time for an MRI. Well, he said, if they think you may have something serious, it could take only a few weeks. Otherwise maybe six months. 

Another man I ate breakfast with was suffering with serious hip pain. He told me he needed a hip replacement, but they wanted to wait longer before deciding to do it. The man was 77. I asked him when he could get the new hip once approved; about two years, he said. His cynical perception of his own system was that they waited as long as they could, so you only got one hip replacement. 

You see, all this promise of free stuff isn’t so free. There is always a price to pay. In case you are among the Bernie Sanders Medicare-for-all advocates just keep in mind that no single-payer system can deliver “free” health care and no system can be affordable unless it manages costs which means managing the care provided. 

Obamacare has met a part of its objective; expanding coverage but now the consequences of that are very apparent … ever growing premiums. Those premiums are rising for several reasons, elimination of most underwriting requirements, adverse selection by consumers, under pricing under political pressure in the first couple of years of the ACA and coverage mandates. To make matters worse, holding down premiums has led to higher out-of-pocket costs making health care less not more affordable overall. 

Now we are at the point where a public option is sought by many as the cure by creating competition. Competition for who? A public option will face all the same problems as the private insurers do … except a public option can simply ignore losses when setting premiums as if that is a solution. 


Politicians like Clinton have a unique solution. Ignore the actual problem and put a bandaid on out-of-pocket costs. She wants to cap prescription drug expenses for the chronically ill at $250 a month, force insurers to classify emergency visits as β€œin-network” and to pay for three sick visits to the doctor, with no out-of-pocket costs to the patient. Clinton and her advisers know that such changes drive up premiums, but also increase pressure for a public option (who’s cost, of course, will also increase). 

She and other politicians have another easy solution too. Just have state regulators reject premium increase requests. We all know there is no relationship between premiums and health care costs. πŸ‘…

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2 replies »

  1. I hear Colorado is going to vote on single payer.

    Someone should have them check in with the State of Washington:
    http://www.washingtonpolicy.org/library/docLib/individual-health-insurance-market.pdf

    or the state of Bernie, Vermont:
    http://www.nejm.org/doi/full/10.1056/NEJMp1501050

    For comparison, the only way the Romneycare mandates worked in Massachusetts was the result of two items unique to MA:
    (1) First, they already had the lowest level of uninsured, non-elderly population, less than 10%, and
    (2) Second, they got a waiver from the feds to expand Medicaid and to have federal taxpayers pick up the tab. (Note: In MA, low income folks were eligible for expanded Medicaid in 2006. Participation in Medicaid among low income folks went from 65% in 2005 to 95% in 2007. Amazing how you can get people to sign up … they coined this activity as the “woodwork effect” – that offer access to taxpayer subsidized coverage and watch them come out of the woodwork (and across state lines as well).

    The answer remains: “I want the best health coverage YOUR money will buy”. Which leads us to Margaret Thatcher: “The trouble with Socialism is that eventually you run out of other people’s money.”

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  2. The first lesson of economics is scarcity: there is never enough of anything to fully satisfy all those who want it.

    The first lesson of politics is to disregard the first lesson of economics.

    Thomas Sowell

    Like

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