Even in these difficult days the advantages of Universal Healthcare Coverage in the US are sadly obscured from the public. Rather, the negative aspects continue to prevail in the American mindset. Mistakenly the American voter is often trapped into ideological rather than rational arguments such as a false sense of freedom of choice, or the concept of freedom in general, opposition to socialized medicine, opposition to having the government dictate one’s choices and other arguments, including the fear of government inefficiency when running such a big program.
After some evaluation it turns out that these arguments are mostly absurd. Let’s assume that by some miracle a new system was adopted, similar to the model in Canada. This would mean that in each state all the insurance companies were pooled into a single insurance company whose role is to collect the cost of healthcare and to cover everyone. Some 30% of healthcare costs would be immediately saved and available to provide actual healthcare rather than wasted on running the operations of insurance companies including all their buildings, actuaries and executives. It is no surprise that Canada spends about 10% of it’s GDP on healthcare and covers everyone while the US spends 15% of all its GDP and only covers some two thirds of the population. The reason for the difference is mostly in the cost of operating mammoth insurance companies in the US versus relatively no such cost in Canada since the insurance companies are replaced by a processing body that moves funds from the insured directly to the providers.
Should such a system be adapted in the US doctors’ offices would not need half a dozen secretaries to bill and argue with insurance companies and patients would be spared the stress of figuring out what is covered and what not.
Regarding the issue of freedom we might ask: which is the freedom we are looking for? Freedom from the stress of healthcare coverage and hassles with insurance companies or freedom from the worries and stress about our healthcare coverage.
Looking at the issue of efficiency, what is more efficient for the labor market? A market where employers are free to compete without the burden of shopping and providing health insurance for their workers or a market where employers must figure out for themselves and struggle with health care costs?
As for the efficiency of a private versus universal system, which is more efficient – a system where dozens of insurance companies spend billions on operations or having these redundant expenditures eliminated by having every state pool all insurance companies into a single entity whose mandate is to collect the appropriate funds and to cover all.
Then there is the issue of freedom of choice. Which system has more choice? The current system in the US where insurance companies require pre approvals and dictate the choices of doctors and treatments, or a universal system where patients can choose any doctor they wish.
Those who oppose universal coverage on the basis that it is a socialist system they should remember that we already have such a system through Madicare and Medicaid and through hospitals that charge higher rates for the insured to make up for their expenditures on the uninsured.
Many of those who oppose universal coverage on the premise “why should I pay for someone else?” need to remember that they are already paying for someone else as shown above and they also pay for someone else the moment they have any form of insurance – that is they contribute to a fund where everyone in the pool covers for everyone else. In essence any form of health insurance is in ultimately socialized health care. The difference is in the level of inclusiveness. Universal healthcare simply pools all the insurance companies into one, thus eliminating the costs of running dozens of redundant insurance companies.
Dogmatic ideology, dominates the perception as most Americans are caught up in Cold War anti socialist myopia by which socialized health care is confused with socialism as a system of government. The fear mongering and lobbying by Health insurance companies has stifled information about the advantages of universal health care. Socialized health care is somehow associated with socialism. Yet the building of roads, policing, schools, firefighting are accepted with all their socialism. It is somehow understood that the free markets cannot plan and build roads or school systems by themselves efficiently but need a pooling of sorts by which governments guide the system and assign contracts to private enterprises. The same common sense applies to healthcare and is accepted in almost all the developed economies except the US. What makes the debate most absurd is that federal and state agencies are already paying about 45% of the $2.2 trillion the nation spent on medical care in 2004. The U.S. government spends more on health care than on Social Security and national defense combined, according to the Brookings Institute.
The notion that free markets are efficient and therefore the best choice is so deeply engrained in the American mindset that many cannot conceive the notion that private insurance companies are actually behemoths of inefficiency, even though they are, in theory competing. To begin with there is a fundamental flaw in with private insurance companies. Their profit motive provides the unfortunate incentive to provide as little health care as possible. Hence they invest precious resources in misleading and confusing the insured or outright refusing to pay. The sad point about private health insurance companies is that the less coverage they provide the more money the make. I think it will be difficult to find many insured people in the US who have not had a frustrating experience with insurance companies. And yet many of those who endure distress from disputes with their insurance companies are often dedicated supporters of the private system. Perhaps the time has arrived to put reason before ideology in the debate over universal coverage.