Welcome to the Monkey House
Before anyone gets too excited about the prospect of universal healthcare insurance, we should stop to think about what this will really accomplish. First, we should acknowledge that the very poor and the old are mostly covered, and that the largest part of the uninsured really are people who expect to have little use for medical care, and so, take the risk upon themselves. This is the group of 18-35 year old males.
We should note that universal health insurance, by itself, will do nothing to reduce healthcare prices, and in fact will tend to increase prices of health care and the premiums for health insurance because it will serve to increase the demand for healthcare while doing nothing to also increase the supply. Any increase in demand for healthcare because doctor’s visits may suddenly appear to be less costly (paid for through premiums or payments from the government) will merely push up the basic price of healthcare. Healthcare premiums will be pushed up as a result to cover the extra demand.
What is happening now, though, with partial coverage is a problem as well. Here is what happens. Some are covered, and some are not. Those covered are able to access health care at subsidized prices (that they pay for in fixed monthly payments), while those who are not covered pay full price. I think of it like making beer insurance available to college students, insurance that pays their beer tabs. This boosts the beer consumed relative to the full price, or in economics lingo, it boosts the demand for beer. If beer were like medical care, the problem would suddenly become very serious, because the supply of medical care is tightly limited, by medical schools, professional associations, licensure, and even government limits on supply.
But medical care is not quite like beer, because getting poked, prodded, probed, stuck, bled and disrobed, is not as appealing to most as a few cold ones. Many go to the doctor only reluctantly, just as many leave the pub only reluctantly.
The problem is that when some get their health care at some subsidized price, the demand ends up increasing and the full price to the uninsured increases. Some get healthcare a little cheaper perhaps, while others find it difficult to afford.
But what happens when we all are covered with healthcare insurance? It is much like the problem when we all stand to get a better view of a play in a football game–none of us end up getting a better view. When we all get healthcare insurance, we end up paying very high premiums and doctor visit fees much like we would have faced without coverage for doctor visits.
When we have privately paid for health care, or privately paid insurance and managed care plans, the managers of such plans cover certain treatments and do not cover others, bringing to mind the 1997 movie, “As Good as It Gets,” with Jack Nicholson, Helen Hunt and Greg Kinnear, where a boy’s asthma treatment was not covered by his mom’s HMO. At least there is some competition between plans, and employers do most of the “picking” amongst plans, but do so as an alternate means of paying their employees. As a result, though, legislators then have an incentive to mandate coverage of treatments that have political support.
The decision as to what is covered and what is not comes about as a political decision, with the benefits going to small concentrated groups and the costs spread over the premium payers. Politicians can point to greater coverage as an accomplishment of theirs, and since payments are not coming from tax payers but rather from premium payers, politicians can also point out that the government spending and the tax burden was not increased, laying the blame of ever higher premiums on the shoulders of the health insurers and HMOs. The politicians are ordering greater coverage, but someone else is paying for it off budget.
What differs with government health single-payer plans or nationalized plans is that it becomes clear that the politicians are responsible for the costs they no longer have private firms on which to lay the blame for mounting costs. Then, they act much like the HMO Helen Hunt faced in “As Good as It Gets,” but now without competition. Then we start to see both tough choices and questionable choices being made. For instance, this summer stories (see these at Fox and KATU, Portland, OR) began to pour out of Oregon of cancer patients being denied chemotherapy, but offered physician assisted suicide instead, because easing the pain and bringing about earlier death of patients too costly to treat is the right thing to do.
So it goes.
Then there is this recent story from
She insisted there was “nothing wrong” with people being helped to die for the sake of their loved ones or society.
-MC
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