Socialized Medicine

[lets-retire]

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Originally Posted by robcanuck In Canada, we have universal health care. We need to go to the doctor - make an appointment and go. In an emergency, we're treated in the emergency room of the hospital. Emergency surgery or treatment for life-threatening condition - immediate attention. Elective surgery -- you are prioritized and yes, there will be a wait time ( no queue jumping in Canada). I don't think the quality of health care differs significantly between our countries. I understand that per capita health care costs are much less in Canada than in the U.S. Of course, we pay more in income tax for health care. But most Canadians proudly consider our universal health care coverage as one of the most important benefits our citizenship and something we would never give up. Rob

Just wanted to say your welcome. The US health care system subsidizes the Canadian system, because the Canadian government will not pay the asking price for medications. The drug companies not wanting to lose money just increase the price of the same meds in the US. Sounds very similar to Medicare (private insurance has to subsidize that program also).

[OAG]

I am not from or in Canada, but we have has several Canadians respond to this question in the past. I believe the consensus was/is that it is very good but they say they pay for it with a higher income tax rate than we have here in the USA.

I think we may be or are headed for a "cram down" of something of the same sort; including the higher taxes.

[samclem]

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Originally Posted by Independent In your 7 points, you didn't explicitly say how this de-couples insurance from employment. Wouldn't lots of people still prefer having their employers negotiate lower group rates, then subsidize the premiums with pre-tax dollars?

I would remove the tax deduction businesses receive for health insurance costs. Ending this taxpayer subsidy would, at a stroke, put an end to the unproductive and inefficient linkage of employment to medical care. Keep the tax burden constant through some other mechanism (hopefully a reduced overall tax rate on businesses which ultimately reduces consumer prices).

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Originally Posted by Independent I'm not sure how the A-E plans vary. If I'm paying the premium with my own money, I want an option that pays for "all services", but only after a substantial deductible. Remember that average medical costs are around $5,000 per person, so I'd expect deductibles in the multiple-thousand range.

The packages would likely differ primarily in the size of the deductible, the ratio of the co-pay after the deductible is met, and maybe the "frills" (private hospital rooms or semi-private room? Ward? Care restricted to network providers?) But, all plans would provide 100% coverage of the common items that save the system costs in the long run: immunizations, checkups, prenatal care, etc. Also, because we know that in our society taxpayers are forced to support those who become indigent because of catastrophic medical costs, all packages would cover expenses above a certain (relatively high) annual catastrophic cap % of income.

The various packages would provide consumers with the ability to reduce their insurance costs by assuming more risk (higher co-pay% and deductible) or slightly less convenient/cushy care--to a limited degree.

[antmary]

I do not know one Canadian who wishes to trade their system for the one in the US. People do not lose their homes because of hospital bills.

I have a love/hate relationship with Anthem Blue Cross; we have a very good policy, that has been in effect for over 20 years. I am incensed that we now pay $18,000 per year for health care premiums. I feel like we are held hostage by Blue Cross. We are still healthy (albeit in our 60's), and I feel like we have a huge tick attached to our bank account. But, we have to have insurance!

I now believe in a universal single-payer health care system. I very much doubt that the extra taxes we would pay yearly would equal $18,000!

Antmary

[ERD50]

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Originally Posted by antmary I do not know one Canadian who wishes to trade their system for the one in the US. People do not lose their homes because of hospital bills. I now believe in a universal single-payer health care system. I very much doubt that the extra taxes we would pay yearly would equal $18,000! Antmary

Reading this thread may raise a few doubts:

http://www.early-retirement.org/foru...tml#post792423

Also, while Canadians may be reasonably happy with their system, that does not mean it would translate here. You might want to search the soapbox, but IIRC, they mentioned they have multiple political parties, not just two dominant ones, their campaign cycle is months not years, etc, etc. Maybe their govt serves the people better than ours? I dunno.

-ERD50

[Independent]

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Originally Posted by samclem I would remove the tax deduction businesses receive for health insurance costs. Ending this taxpayer subsidy would, at a stroke, put an end to the unproductive and inefficient linkage of employment to medical care. Keep the tax burden constant through some other mechanism (hopefully a reduced overall tax rate on businesses which ultimately reduces consumer prices). The packages would likely differ primarily in the size of the deductible, the ratio of the co-pay after the deductible is met, and maybe the "frills" (private hospital rooms or semi-private room? Ward? Care restricted to network providers?) But, all plans would provide 100% coverage of the common items that save the system costs in the long run: immunizations, checkups, prenatal care, etc. Also, because we know that in our society taxpayers are forced to support those who become indigent because of catastrophic medical costs, all packages would cover expenses above a certain (relatively high) annual catastrophic cap % of income. The various packages would provide consumers with the ability to reduce their insurance costs by assuming more risk (higher co-pay% and deductible) or slightly less convenient/cushy care--to a limited degree.

I think that "eliminate the tax subsidy of group insurance" is a critical part of your proposal. I'm guessing that you want to push people into the individual market so they see the cost more clearly. Note, though, that group can be cheaper due to cheaper marketing/sales costs. I don't know how many people would prefer to have the employer do the shopping (and go to bat when a claim isn't paid). I expect that more and more companies would decide they don't want to mess around with health insurance, but it would take a while.

I like your "annual catastrophic cap % of income". That's one of the keys in the plan that I described in post #148. With individual insurance, I think that means the gov't tells poorer people the have to buy lower deductibles. That sounds negative, but maybe there is a way to coordinate it with the vouchers.

[youbet]

Quote:

Originally Posted by antmary I do not know one Canadian who wishes to trade their system for the one in the US.

It will be interesting to see how they feel about it after we have our own public system. Once we're not paying a premium for drugs compared to Canada and other parts of the world, there may be a change in the Canadian system and others effectiveness. Prices they pay are bound to increase.

[Martha]

"People who have what they want are fond of telling people who haven't what they want that they really don't want it." Ogden Nash

Appropriate quote for discussions on the health care sector.

[ERD50]

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Originally Posted by Martha "People who have what they want are fond of telling people who haven't what they want that they really don't want it." Ogden Nash Appropriate quote for discussions on the health care sector.

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Originally Posted by antmary I do not know one Canadian who wishes to trade their system for the one in the US.

Wouldn't that Ogden quote translate to the Canadians telling the USA that we don't want a Canadian system?

That doesn't seem to jibe with what I've been reading here and other places, but maybe I'm misinterpreting something.

-ERD50

[ziggy29]

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Originally Posted by ERD50 Wouldn't that Ogden quote translate to the Canadians telling the USA that we don't want a Canadian system? That doesn't seem to jibe with what I've been reading here and other places, but maybe I'm misinterpreting something.

Could be, but I just attribute it to a feeling that "the grass is always greener on the other side."

There are elements of both systems that could easily be enviable when seen from the other side of the fence, depending on your circumstances. Human nature tends to covet what it doesn't have rather than be thankful and content for what it does have.

[samclem]

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Originally Posted by Independent Note, though, that group can be cheaper due to cheaper marketing/sales costs. I don't know how many people would prefer to have the employer do the shopping (and go to bat when a claim isn't paid). I expect that more and more companies would decide they don't want to mess around with health insurance, but it would take a while.

Employers will get out of the health care business very soon after the (distorting) tax deduction is lifted. Employers don't provide food for their employees, they don't help them buy houses, they don't arrange group purchase prices for employee cars, and the only reason they are involved with providing health care are these tax laws. Employees won't want them involved, they'll prefer the extra money in their paychecks (and they'll get it--because wages paid to workers will increase due to the same pressures that keep wages where they are today. Health care coverage is compensation today, and those who believe employers will just pocket the savings if health care costs are removed need to think harder about wages, supply, and demand).

[youbet]

Quote:

Originally Posted by ERD50 Wouldn't that Ogden quote translate to the Canadians telling the USA that we don't want a Canadian system? That doesn't seem to jibe with what I've been reading here and other places, but maybe I'm misinterpreting something. -ERD50

It would seem that way.

I've only spoken with two Canadians on the subject and they were both Canadian citizens on assignment for my former employer MegaCorp here in the States. Their views might not be typical or representive.

They both were highly in favor of the Canadian system. But both felt that having access to USA medical resources (on their own dime and these guys could afford it) was important to them and they'd rather not give it up. I have no clue why they would feel that way. Seeking the best of both worlds perhaps?

Neither seemed to want us to not have what they have, as the Ogden quote would imply. They just wanted our system to still have centers of excellence like Mayo, Cleveland Clinic, etc., and for access to those centers to be available to them on a "money talks" basis.

[lets-retire]

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Originally Posted by samclem Employers will get out of the health care business very soon after the (distorting) tax deduction is lifted. Employers don't provide food for their employees, they don't help them buy houses, they don't arrange group purchase prices for employee cars, and the only reason they are involved with providing health care are these tax laws. Employees won't want them involved, they'll prefer the extra money in their paychecks (and they'll get it--because wages paid to workers will increase due to the same pressures that keep wages where they are today. Health care coverage is compensation today, and those who believe employers will just pocket the savings if health care costs are removed need to think harder about wages, supply, and demand).

Actually the DW has worked for employers that would provide house purchasing assistance, but she has worked in banking for many years, so it was in line with products they provided and the real cost to the employer was minimal. I am currently driving a car that was purchased at a discount, because my past employer had a relationship with the car manufacturer. It didn't cost anything for my employer to provide the discount.

If the tax benefit is taken away from employer provided insurance, I think what could happen is the employer would provide a group plan, but the employee would pay all of the premiums. The company would see a savings, from transferring the premium costs while at the same time still providing the benefit of lower cost insurance for the employee.

[samclem]

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Originally Posted by lets-retire If the tax benefit is taken away from employer provided insurance, I think what could happen is the employer would provide a group plan, but the employee would pay all of the premiums.

There's nothing sacred about the construct I've laid out there (and I'm sure there's not an original thought in it), but for it to work there needs to be no underwriting (not just excluding folks from coverage, but also no price differentiation based on health factors). If Prudential sells the "A" plan in Vermont, anyone who lives in Vermont can buy the "A" plan at the stated price. If better deals are available through employers, clubs, etc then there would be a significant opportunity to get de facto underwriting--since those who are employable are, as a whole, healthier than those who are not. You could form a club of 10K runners that requires all members to complete one 10K event per quarter, and then buy insurance as a group, thereby "cherry picking" and forcing higher rates on the public pool.

It turns out that once we start accepting colectivism, sometimes we have to take it chunks-at-a-time for it to make any sense. Lots of people shout for a common solution whereby everyone gives a little for the comon good, bt as soon as the program is instituted, they'll start looking for an angle that maximizes their personal benefit. "I like that answer for our country and for most people, but what I need is . . . "

[Gumby]

This has been a most edifying discussion for me, one that makes me appreciate this board all the more. Thanks to all who have contributed.

The one question with which I am still grappling is this -- what do insurance companies add to the mix other than extra cost? It doesn't sound like they impose any price discipline on the health care market. Certainly insurance is a risk sharing mechanism, but why can't the government fill that role? You could still have substantial deductibles to encourage consumers to shop for efficiently provided health care. You could still de-link the provision of health care from employment.

[Rich_by_the_Bay]

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Originally Posted by Gumby The one question with which I am still grappling is this -- what do insurance companies add to the mix other than extra cost?

Bingo. They add little to nothing that couldn't be readily replaced at much lower cost (except for HMOs but I assume you mean traditional carriers).

Health promotion: minimal, unproven, and self-serving. Truly, IMHO, they add no essential services. A small legitimate exception is when they act as third party administrators to groups that choose not to do so themselves (policy boilerplate, claims management, premium and benefit disbursement, etc. The problem is that many of those services are byproducts of the industry itself.

The feds manage medicare's administrative tasks -- poorly but not negligently. The states manage the same for Medicaid, though often by subcontracting to private carriers. Given half a mandate, the entities could do it themselves.

[lets-retire]

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Originally Posted by Gumby The one question with which I am still grappling is this -- what do insurance companies add to the mix other than extra cost? It doesn't sound like they impose any price discipline on the health care market. Certainly insurance is a risk sharing mechanism, but why can't the government fill that role? You could still have substantial deductibles to encourage consumers to shop for efficiently provided health care. You could still de-link the provision of health care from employment.

The reason I don't want government to fill the role is simple. When insurance is purchased from a private company it is a transaction between two parties and either is able to leave when the situation does not fit the needs of that party. When the government takes control of the situation there will be no other option, I either take it or leave it. All of the savings being tauted seem to be from expanding the paying pool to those who really wouldn't buy insurance if it wasn't mandatory and taking people out of the ER and placing them in a family doctor type setting. The poor who need the insurance, but can't afford it, wouldn't be paying into the system and would be a net cost to it. Since the savings is mostly coming from new subscribers their freedom to have or not have insurance is being limited. The increased demand for service at the family doctor, assuming market forces are not hindered, will result in price increases. In my opinion the end result will be a net increase to the cost of health care. Yes, the expensive ER visits would go down, but the cost of the family doctor would go up as will the number of frivolous doctor visits.

Remember back to when auto insurance was not required. The consumers started to complain that the price of insurance was too high. The insurance companies held that they couldn't lower the rates because they had to, not only cover their driver's actions, but also the actions of the uninsured motorists. The insurance companies went on to say, if the states would just pass a law requiring every driver to have insurance the costs would come down. The states passed the law and insurance rates did not come down. The insurance companies then held that because they now had to cover the drivers who did not have insurance before the law passed, many of whom were horrible drivers, they were unable to lower their costs. I do not see any reason for the insurance companies to change their business practice. The federal government will mandate coverage for all and the cost will not go down. Not seeing the cost savings expected and in fact a cost increase the government, in my opinion, will make moves to control the price, provide insurance for all through taxes, or simply provide the health care. Now instead of having several companies to choose from and having competition to lower prices our options will be limited to what ever the government determines will be in our best interests. As it sits now if we don't like what our employers provide we can always go to the private market. The other option of the government providing the health care does not sit well with me. I had government provided health care for many years and was unimpressed, to say the least. I will admit that I have had to get onto the insurance companies and doctors in the private sector but, no more than I do with any other major purchase. Overall the medical treatment has been much better in the private arena in my experience.

No matter what the government does the price of health care will go up. The Boomers are starting to enter retirement, this includes the Boomer doctors. There will be a decrease in the number of doctors, at the same time as an increase in the number of elderly (many with health issues), so even if nothing is done the price should go up. If the number of patients is expanded even more by providing health care to all, the inflationary forces will be even greater.

[ERD50]

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Originally Posted by Gumby Thanks to all who have contributed. The one question with which I am still grappling is this -- what do insurance companies add to the mix other than extra cost?

Likewise - for some reason (probably the Q/A feedback), I seem to be able to learn more here, than through other sources (media, blogs, even wiki).

A friend asked the same Q of me, and I didn't have an immediate answer. I think let's retire captured it - competition. The ins cos should have a fairly small role in this, basically administrating and coordinating and explaining what benefits are available, limits and such.

I think the auto ins requirement is a good analogy. While the auto ins business is far from perfect, would we really want it handled directly by the govt (think DMV)? Not me, I'm reasonably happy with State Farm, my feeling about the DMV would not pass the filters built into the forum SW.

-ERD50

[Gumby]

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Originally Posted by lets-retire Remember back to when auto insurance was not required. The consumers started to complain that the price of insurance was too high. The insurance companies held that they couldn't lower the rates because they had to, not only cover their driver's actions, but also the actions of the uninsured motorists. The insurance companies went on to say, if the states would just pass a law requiring every driver to have insurance the costs would come down. The states passed the law and insurance rates did not come down. The insurance companies then held that because they now had to cover the drivers who did not have insurance before the law passed, many of whom were horrible drivers, they were unable to lower their costs. I do not see any reason for the insurance companies to change their business practice.

I'm not certain that this is a good analogy. In fact, the insurers' profit motive largely explains what happened. They leaned on government to mandate auto insurance, thereby increasing demand for their product. Then, they reneged on the promise they used entice the government to take action, citing yet another excuse for their high rates. This is precisely why I think insurers should not be part of the solution -- they are in it solely to make money for themselves, not to ensure that you or I have adequate health care.

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Originally Posted by lets-retire I had government provided health care for many years and was unimpressed, to say the least.

I also had government provided health care and thought it was fine, but no one should use my anecdotal evidence as the basis of a health care plan either.

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Originally Posted by lets-retire No matter what the government does the price of health care will go up. The Boomers are starting to enter retirement, this includes the Boomer doctors. There will be a decrease in the number of doctors, at the same time as an increase in the number of elderly (many with health issues), so even if nothing is done the price should go up. If the number of patients is expanded even more by providing health care to all, the inflationary forces will be even greater.

The factors you cite are certainly pushing in the direction of higher costs, but I am troubled by your last sentence. It seems wrong to me to imply that a good reason to oppose providing health care to those who currently don't have it is to prevent the rest of us from having to pay more for our own health care. We are all in this country together.

[Meadbh]

I've stayed out of this debate till now because this is an American question which Americans must answer.

To quote Paul Batalden: "Every system is perfectly designed to get the result it gets".

As I see it (and please don't shoot the messenger) the current American system currently results in groundbreaking advances, top notch, timely care for people who are well insured, little emphasis on prevention or population health, high overall costs, a large segment of the population who do not have access to healthcare, a high rate of healthcare related bankruptcy, and extreme anxiety among members of this Forum.

Now, maybe that's what you all want. If so, then don't change a thing!

The way I see the Canadian system is that healthcare is treated as a public good, and equity is a fundamental value. Indeed, that's enshrined in law. We've all agreed that a person's financial status should not enter the equation when access to needed health care is concerned, and we as a society are prepared to pay for this. This decision significantly reduces administrative costs and allows for a greater emphasis on prevention and health promotion. It's also an economic advantage. A disadvantage of our current system is that the law also stipulates public administration, which limits the ability of the healthcare consumer and the practitioner to choose. So, for example, I have no opportunity to practice intensive care in the private sector, but If I were (say) a cosmetic plastic surgeon, I could establish or work in a private surgi-centre, opt out of medicare and bill my patients. Personally, I would like to have the ability to choose some private care. That would require accepting parallel systems as most European countries do. The argument against parallel systems is that the private system will cherrypick the easy cases, leaving the public system to pick up the pieces as best it can.

I think Ziggy hit it on the nail with this comment:

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Originally Posted by ziggy29 Affordable. Universal. Top quality. Pick any two. If we make it affordable and universal, pricier available procedures may be unavailable and/or rationed. If we make it affordable and top quality, it's going to be pretty hard to make it universal without all the underwriting and exclusions. If we make it universal and top quality, the cost will go through the roof. Basically, we have to decide where our priorities lay.