Health Care and the Moderate Republican

It can be hard at times to be a Republican that supports health care reform, because you are immediately tagged with wanting some kind of massive state system ala Canada or the UK. There are shouts of wanting “liberty” and a “free market” in health care without really putting forward real plans.

Shay over at Booker Rising, assumes that because I want a “government takeover of health care:”

Opposing a government takeover of health care (which Mr. Sanders believes is the only type of health care reform) – 1/6 of the U.S. economy – is quite different than opposing health care reform in general. Almost all libertarian, conservative, moderate-conservative and/or Republican critics of the current bill want reform, but one that honors individual choice, liberty, and America’s cultural tradition of free markets and not European nanny-statism. If I wanted to be European, I’d move to Europe.

My guess is she read way too much into my previous post on health care and the GOP. In that last post, I said that there is incentive for Republicans to be very serious on health care. Somehow that got interpreted to mean that I supported the Democratic plan (which I didn’t). My intent was to make it worth the Republican’s while to come to the table with plans that are not massive intrusions into the American economy.

I would rather have a system that use the free market as much as possible and has limited state intervention. We will probably never have a totally free market system for the simple reason that the Federal and State governments already have a hand in the health care system through programs like Medicare and Medicaid. While those two programs are not perfect, they do provide a service in making sure that the elderly and the poor are taken care of.

But the question remains: how do we help the rest of the population? Well, being a conservative, I would like to see the free market have a role. But living in a democracy, I know I won’t get everything. There are some real health care plans out there that conservatives should be supporting to make sure people have proper access to health care and also keep costs down.

The Wyden-Bennett bill was one that was able to provide the choice that Shay talks about and also was able to hold costs down. It is a bill that I think conservatives should support. It’s not the whole loaf, but it’s a good two-thirds of a loaf.

Another idea is to basically challenge the whole concept of health insurance and make it acutally health insurance. Think of this one as a free market model with a catastrophic program as the cherry on top. This was explained in the great essay by David Goldhill called “How American Health Care Killed My Father.” His idea is as free market as you can get:

For years, a number of reformers have advocated a more “consumer-driven” care system—a term coined by the Harvard Business School professor Regina Herzlinger, who has written extensively on the subject. Many different steps could move us toward such a system. Here’s one approach that—although it may sound radical—makes sense to me.

First, we should replace our current web of employer- and government-based insurance with a single program of catastrophic insurance open to all Americans—indeed, all Americans should be required to buy it—with fixed premiums based solely on age. This program would be best run as a single national pool, without underwriting for specific risk factors, and would ultimately replace Medicare, Medicaid, and private insurance. All Americans would be insured against catastrophic illness, throughout their lives.

Proposals for true catastrophic insurance usually founder on the definition of catastrophe. So much of the amount we now spend is dedicated to problems that are considered catastrophic, the argument goes, that a separate catastrophic system is pointless. A typical catastrophic insurance policy today might cover any expenses above, say, $2,000. That threshold is far too low; ultimately, a threshold of $50,000 or more would be better. (Chronic conditions with expected annual costs above some lower threshold would also be covered.) We might consider other mechanisms to keep total costs down: the plan could be required to pay out no more in any year than its available premiums, for instance, with premium increases limited to the general rate of inflation. But the real key would be to restrict the coverage to true catastrophes—if this approach is to work, only a minority of us should ever be beneficiaries.

How would we pay for most of our health care? The same way we pay for everything else—out of our income and savings. Medicare itself is, in a sense, a form of forced savings, as is commercial insurance. In place of these programs and the premiums we now contribute to them, and along with catastrophic insurance, the government should create a new form of health savings account—a vehicle that has existed, though in imperfect form, since 2003. Every American should be required to maintain an HSA, and contribute a minimum percentage of post-tax income, subject to a floor and a cap in total dollar contributions. The income percentage required should rise over a working life, as wages and wealth typically do.

Another idea that conservatives should consider is how health care is done in Singapore. They use a form of health care savings accounts as the basis of their system:

* There are mandatory health savings accounts: “Individuals pre-save for medical expenses through mandatory deductions from their paychecks and employer contributions… Only approved categories of medical treatment can be paid for by deducting one’s Medisave account, for oneself, grandparents, parents, spouse or children: consultations with private practitioners for minor ailments must be paid from out-of-pocket cash…”
* “The private healthcare system competes with the public healthcare, which helps contain prices in both directions. Private medical insurance is also available.”
* Private healthcare providers are required to publish price lists to encourage comparison shopping.
* The government pays for “basic healthcare services… subject to tight expenditure control.” Bottom line: The government pays 80% of “basic public healthcare services.”
* Government plays a big role with contagious disease, and adds some paternalism on top: “Preventing diseases such as HIV/AIDS, malaria, and tobacco-related illnesses by ensuring good health conditions takes a high priority.”
* The government provides optional low-cost catatrophic health insurance, plus a safety net “subject to stringent means-testing.”

Yes, there are some things that conservatives would have to swallow such as the “public option,” but in the end, this is plan that is not as state intrusive and yet spends less than either Europe or the United States.

Republican legislators have put forth some plans. But in many cases they are pretty vague in how they would both lower costs and provide access to the health care. Mark Kirk, John Shadegg, and the Republican Study Committee have all put forth plans with some good ideas, but they were never forcefully pushed by the GOP. Even if they were good plans, they way they were brought forth showed little seriousness on the issue

Conservatives do believe in the free market. As a conservative, I uphold that principle. But that means nothing if all it is reduced to are platitudes and not about using our principles to provide real and serious solutions.