One of the fun things about being a political moderate is that you can be sure no matter what you say the odds are you’ll tick off people on both sides of the political fence. I am quite sure that this will be true as I offer some of my own thoughts on what sort of proposal should be adopted when it comes to Health Care Reform.
I am long on record as a supporter of reform and have also made clear my view is best summarized by the old Chinese proverb which states that it does not matter what color the cat is, so long as it kills mice. For me the way we get there is not as important as the outcome, an improved system to provide a healthy population.
At this stage it’s still not entirely clear what the final bill before Congress will contain. Certainly the Senate bill seems to be the foundation but with the various ideas about fixing or adjusting the legislation I’m not sure anybody knows what it will look like when (or if) it gets to the President.
But it is clear that the varied proposals can be divided into three categories:
(1) The ideas that pretty much everyone agrees on
(2) The ideas that the left really likes but the right really dislikes
(3) The ideas that the right really likes but the left really dislikes
It seems to me that the ideal compromise proposal would consist of most or all of #1 and parts of #2 and #3. It is with that package in mind that I construct my own suggestions.
One area that we need general agreement on is exactly what kind of coverage we are talking about when we discuss health care reform. There are many levels of insurance coverage from very basic to the so called Cadillac gold plated plans that provide you with free treatment for everything.
Certainly it is very important for someone to be able to go to the doctor if they have a treatable illness or injury or if they need some form of preventative care. On the other hand, if we make everything free then people are going to go to the doctor for hangnails and stubbed toes.
I’ve previously discussed my own health care issues when I compared having a case of athletes foot versus having a problem in my EKG. Certainly when I had irregularities in my heartbeat it was important for me to go to the specialist to make sure that everything was fine (which it was). But when I had athletes foot, I hardly needed to go to the doctor to have him tell me to put some lotion on it.
Similarly, if you’ve got a serious flu or cold that could pose serious health risks, it is important for you to go to the doctor for treatment. But if it’s just a basic flu or cold, we all know about staying in bed, drinking liquids, etc.
I’m not talking rationing here, but any health care reform needs to recognize the need to provide for low or no cost treatment for the important things while making the more optional treatments have some cost attached to them so that people won’t abuse the system.
This may be one area where nobody is really talking about what to do.
Moving on to those things pretty much everyone agrees on we have a number of good ideas.
- Prohibiting carriers from denying coverage for pre-existing conditions
- Requiring that all insurance plans contain coverage for preventive care, including free or low cost annual physicals.
- Prohibiting carriers from canceling coverage because someone becomes ill
- Prohibiting or limiting carriers from massive rate hikes after illness
- Banning lifetime caps on coverage
- Allowing children up to the age of 25 to remain on their parent’s policy
- Helping employers or community organizations promote wellness plans to encourage a healthier lifestyle through tax breaks and/or subsidies
These seven reforms are one that pretty much everyone agrees on so they certainly should be part of any plan.
Having looked at the areas we agree on we need to look at those areas where the left and the right disagree, which is of course the reason for all of the fighting in Congress right now. It seems to me that we can find some reasonable compromise in these areas.
Next I would like to look at some of the ideas championed by the left.
I think we absolutely have to require coverage for everyone. I know that this is a touch subject with many who say that it is the right of a person to decide whether or not to get coverage. But the truth is that nobody really does make that kind of a choice.
You may be quite sincere in saying that you are willing to accept the risks of not having coverage. But if you or a family member get sick or have an accident and you need care, the fact is you are going to do whatever is required to get that care, including using public facilities. If you do manage to pay for the coverage yourself and then reach a point where you have to choose between paying those bills and feeding your family, you are going to choose your family.
This is not a bad thing, it’s an entirely normal reaction. But it belies the argument that some people are willing to take the risk of not having coverage. The truth is that whether you do so consciously or not, you are relying on the fact that if you *need* treatment you’ll get it and that if you cannot pay for it in the long run that bankruptcy is an option.
So mandatory coverage for all is a must. That doesn’t mean you have to get a gold plated plan, you can get a fairly basic ‘get hit by a bus’ sort of plan but you have to have some sort of a plan. This will both protect society from having to bear the burden of your future treatment as well as providing a broader pool to help keep coverage costs down.
Another must that is supported by the left and often rejected by the right is having subsidies for lower income groups.
As I’ve discussed above it is in the long term best interests of society for everyone to have coverage but the fact is that not everyone can afford it. So we need to have some form of subsidy system, on a sliding scale, to provide help to those who cannot otherwise purchase coverage themselves.
This does not mean that we will provide top of the line insurance plans to everyone. There are limits to what we can afford to pay for and it is entirely reasonable to say that the subsidies should be geared to provide a basic plan to everyone who cannot afford it rather than a top of the line plan.
Of course these subsidies will cost money and therefore we need to find a way to pay for them. Not having the benefit of the CBO to calculate things for me I cannot say for sure what these subsides would cost. But I do think there could be reasonable ways to pay for them.
Requiring companies that do not provide insurance coverage to their employees to pay a penalty seems like one good step. If the companies choose to provide coverage then that may remove some people from the need for subsidies, if they do not then they help pay for the subsidies.
It will also probably be necessary to increase Medicare taxes on higher income individuals. I’m not a fan of taxes but at the same time they are the price of a civilized society and the fact is that a modest increase in the medicare tax for someone earning $ 500,000 a year is minor compared to what it would be for a family earning $ 50,000. This could also be part one of the process to repair the Medicare system, a process that will also probably require phasing out some benefits for higher income individuals.
Finally I see no reason that those who make money off of the health care system (IE the insurance industry, drug companies, etc) should not share in the cost of this system. My proposals do not involve a public option or single payer plan, but rather generally preserve the free market system. It seems a fair trade for a modest portion of the profits to go back into the system.
At this point I would be reluctant to support taxes on higher ‘Cadillac’ plans, especially if there is a two tiered system where individuals are forced to pay the taxes but union members are not. Either everyone pays or nobody does.
In any case these taxes need to be imposed now, not in 5 or 10 years. If we are going to repair the health care system then we need to do it all at the same time. With our deficits already soaring we cannot have the benefits come in now and the burdens come in 5 or 10 years on the assumption that a future Congress will vote for tax hikes.
This does not mean we cannot gradually phase in the taxes and fees, but the process should start now
A third idea that the left promotes which seems to me to make sense is to lift the anti-trust exemption currently afforded the health insurance industry. This would allow for the government to step in when the various companies conspire to keep rates high or when the collude to block certain benefits or treatments from being offered.
Almost everyone else has to comply with anti trust laws and I see no reason the insurance industry should not do the same.
A fourth area where I think we should adopt ideas from the left is in the area of regulation of costs. The recent example of Anthem Blue Cross trying to raise rates significantly demonstrates one of the major flaws of the current system. We need to have some way for an at least quasi neutral third party to regulate costs.
So I support the idea of some sort of federal regulator or board that insurance companies have to go to to get authorization for rate increases. They would have to justify why the price increases are needed before they can go into effect.
I also think a similar system could be useful in terms of regulating what hospitals and medical providers charge for services. We already have Medicare regulation of what they will pay for services so I think a similar system could be applied system wide.
Now such a system would have to be more reasonable that the current Medicare one, which often pays far less for services that the actual cost. We’d need to have a board with representatives from all parts of the system, including those from the medical industry.
So from the left side of the debate we get four good ideas: Mandatory coverage, Subsidies, Lifting Anti Trust Exemption and Price and Cost Regulation.
But the right also has some good ideas to contribute.
For example there is the idea of tort reform. I know this is something that many on the left oppose but the fact is that if you are going to regulate health care costs you need to reform the tort process. I do not mean by this that we should allow truly negligent doctors or nurses to get away with major mistakes but at the same time I think we need some realism brought back into the process.
Indeed in countries like Canada tort reform has been part of the way they work to keep down costs. You don’t eliminate lawsuits but you do place more emphasis on actual losses and place reasonable limits on punitive damages. In both Canada and Europe there are many examples of the ‘loser pays’ system under which a person who files a lawsuit and loses is required to cover the costs of the person they sued.
Obviously such a system would require fine tuning. We can’t have a disabled person being required to pay thousands of dollars in costs to a rich doctor. But we certainly could have regulations in place to discourage people from filing lawsuits frivolously.
Another good idea that has actually come from both sides, but tends to be a little more active on the conservative side, is the concept of non profit cooperatives. Individuals and small businesses could come together in groups to purchase medical coverage together. This allows them to spread risk and reduce costs.
As part of such a system we should allow for people to shop across state lines. This is one area that brings real fireworks for some on the left but with all due respect I think the argument against shopping across state lines fails to recognize some realities.
The basic view of those who oppose shopping across state lines is that all of the healthy people would go to the ‘cheap state’ which would leave the other state(s) with lots of unhealthy people. This presumes that there are not already such disparities. If you look at say the states of Connecticut and Mississippi you will see my point. They are roughly equal in population but the demographics are very different.
Connecticut tends to have a more affluent population and on the whole a younger one (people tend to retire to the South, not to New England). The affluence and youth means they are both healthier on the whole and also more able to afford coverage. Mississippi by contrast has a poorer and less healthy population and under the current system they are all stuck together, unable to get the same deals that people in Connecticut can.
If we have the price and cost regulation discussed above, that would seem to offer protections against dumping the less healthy population into one bad state. Indeed with regulations requiring plans contain the same basic kinds of coverage it is likely things would balance out nationwide.
A third proposal from the right that I think is valuable is to offer continued and expanded support to the concept of Health Savings Accounts. People need to have basic insurance coverage, that should be mandatory, but they also should have the option to decide if they want a more elaborate plan or if they want to use an HSA to provide resources to pay for the occasional unusual expense.
So this gives us three good ideas from the right to add to the four good ideas from the left for a total of seven concepts from the partisans. Along with the seven concepts that everyone seems to share we’ve got a nice package of proposals that I think both sides should be able to support.
It won’t make the public option/single payer advocates happy nor will it thrill the total free market types, but for the broad majority of us I think this is a very equitable balance. It obviously is not the final solution or a perfect one and even if implemented completely it would probably require adjustment in the future.
But it’s a pretty good start on the process. As with the need to start the income portion of these reforms now we also need to start the reforms themselves. They can certainly be phased in over time but the process needs to begin this year, so we can see how they work and make what changes we need.
I’m sure everyone has some thoughts, and I am sure many of them find flaws in my proposals. I welcome comments on any and all sides because this is an important discussion. All I ask is that we try to keep the debate reasonably civil and that we all try to recognize that just because we do not agree on all the solutions does not mean any of us likes the problem or wants to see people suffer.
Let the games begin.