How Should Americans' Health Care be Paid For?

[donheff]

So as you say, the legislator's staff always had the final word - so all I'm saying is hold them accountable, not the lobbyists. We agree, right?

-ERD50

Yes, we agree on this. If we got going on the affect of money being dumped into campaigns though...

 

[Independent]

I don't think I'm following you, but then again my "grocery store" analogy isn't very precise.

People should be allowed to buy insurance. I think it works much better if they buy the policy directly in a controlled, regulated marketplace where they can choose their insurance provider. (Whether the employer cuts the check or the individual does, the individual is the one paying. Without doubt. This money is already computed into the market price of his compensation.)

This insurance will be lower in cost if various insurers compete with each other for this business, just as businesses compete with each other in every other part of our economy, resulting in lower costs and higher quality. We can accomplish ancillary social goals through government subsidies for the purchase of qualifying policies, through restrictions on underwriting ("all sellers must accept all applicants at the same price" or some variant perhaps based only on age, etc).

Some insurers might use a capitated or HMO model, some might reimburse providers on a fee-for-service basis, etc. People will vote with their dollars (and the poor will have some dollars provided by the rest of us).

We'd have to have a national discussion about what goes into this "basic" insurance. Mandatory co-pay levels reduce costs for everyone. Free immunizations and some checkups reduce costs for everyone. Since the level pricing forces all of us to subsidize everyone, we'll probably decide that private hospital rooms and expensive chemo for 90YO patients aren't something everyone should be forced to pay for, but that those who want it can buy their own individual policies at market rates.

Okay, you're saying eliminate employer subsidies, essentially my second choice. I'm fine with that idea (I'd consistently said we should eliminate the tax preference for employer paid health insurance).

But, I don't see how "all sellers must accept all applicants at the same price" would work. Some people are going to avoid paying premiums until they know they're sick. If they have an accident, emergency rooms will treat them. Others will buy high-deductible, restricted benefit plans while they're healthy, then switch to low deductible, high benefit plans when they get sick.

This forces insurers to raise premiums to cover anti-selection, higher premiums increase the incentive to defer buying, which sets off another round of anti-selection, etc. (The jargon for this is "assessment spiral".) I see a disaster.

 

[GregLee]

I do know that the plan was enacted and that I have seen no change in health care coverage and that my healthcare insurance continues to rise at an alarming rate. so what is the healthcare plan supposed to do? healthcare programs are of no use to the public if we can't afford to buy them.

Who is "we"? You already had healthcare, probably. My idea of the new plan's main point is that it will achieve universal coverage. It's not for you and the others on this board. Yes, when the Dems were trying to increase support, the claim was made that the cost of healthcare would go down, but that was just politicians' lies. We obviously can't extend the system to many others, maintain quality, and magically reduce the cost. Somebody has to pay. If not you, who would it be?

 

[samclem]

But, I don't see how "all sellers must accept all applicants at the same price" would work. Some people are going to avoid paying premiums until they know they're sick. If they have an accident, emergency rooms will treat them. Others will buy high-deductible, restricted benefit plans while they're healthy, then switch to low deductible, high benefit plans when they get sick.

This forces insurers to raise premiums to cover anti-selection, higher premiums increase the incentive to defer buying, which sets off another round of anti-selection, etc. (The jargon for this is "assessment spiral".) I see a disaster.

Right. Lets first recognize that all these "challenges" occur because we, as a society, don't want to live with the results of an entirely free market (where insurers would only sell policies to people after a medical exam and assessment of risk, etc). We want everyone, sick and healthy, poor and rich, to have basic medical care. So, we need to interfere to achieve these results. That interference could take many forms. There are ways to spread the high costs of providing basic insurance to the sick and elderly (by eliminating all physical exams/medical history reviews and making everyone pay the same thing. There are other ways, too.). There are ways to prevent people from getting insurance at the last minute or after they need it (the present law does this by making insurance mandatory, with fines for those who don't buy it. This may be unconstitutional, we'll see. There are plenty of other ways to accomplish this with waiting periods, mandatory durations before switching insurers, etc). All of this is do-able, and necessary if we want to achieve some of the social objectives that an entirely unfettered free market fails to achieve. If we do it right, we get many of the benefits of a market based system (competition, with attendant lower costs and higher quality). If, instead, we go with a command-driven centralized government model, I think we all know what we'll get.

 

[Texas Proud]

Sam... good points there...


I was thinking about the problem of people buying cheap policies that have high deductibles and then switching once they have major problem... This can be fixed by not paying for the pre-existing condition at the new level, but at the old policy level... sure, lots of small print etc. and maybe it can be abused... but I think that having a waiting period is not all bad...

Now, if you are healthy and switch... then if something happens you are fully covered.. again, gvmt regs and all the other problems here... but it is a thought...

 

[DeborahB]

I do not understand the obama healthcare plan. it is too big and too complicated for the average person. I do know that the plan was enacted and that I have seen no change in health care coverage and that my healthcare insurance continues to rise at an alarming rate. so what is the healthcare plan supposed to do? healthcare programs are of no use to the public if we can't afford to buy them. the older you get the higher the premium so hopefully they can starve you out and won't have to pay when and if the time comes that you have catastrophic need.

Frank - I don't think anyone has read the whole thing if they're not involved in legislation. The main reason you've seen no change is most of it goes into effect in 2014.

 

[Independent]

Right. Lets first recognize that all these "challenges" occur because we, as a society, don't want to live with the results of an entirely free market (where insurers would only sell policies to people after a medical exam and assessment of risk, etc). We want everyone, sick and healthy, poor and rich, to have basic medical care. So, we need to interfere to achieve these results. That interference could take many forms. There are ways to spread the high costs of providing basic insurance to the sick and elderly (by eliminating all physical exams/medical history reviews and making everyone pay the same thing. There are other ways, too.). There are ways to prevent people from getting insurance at the last minute or after they need it (the present law does this by making insurance mandatory, with fines for those who don't buy it. This may be unconstitutional, we'll see. There are plenty of other ways to accomplish this with waiting periods, mandatory durations before switching insurers, etc). All of this is do-able, and necessary if we want to achieve some of the social objectives that an entirely unfettered free market fails to achieve. If we do it right, we get many of the benefits of a market based system (competition, with attendant lower costs and higher quality). If, instead, we go with a command-driven centralized government model, I think we all know what we'll get.

The 2010 revisions (I hate to use either "reform" or "Obamacare" because I think they are both misleading) solve the anti-selection by mandating both issue and purchase. It appears that combination is okay to you.

So what you're looking for is a next step that eliminates the tax preference for employer provided insurance and requires that providers publish standard rates and maybe some quality information? If so, I can agree with that.

I think that still leaves Medicare as a problem. Even with publicized rates, I think most people will choose whatever their doctor recommends. Maybe you are also looking for a significant increase in deductibles for both pre-65 private insurance and for Medicare?

 

[samclem]

The 2010 revisions (I hate to use either "reform" or "Obamacare" because I think they are both misleading) solve the anti-selection by mandating both issue and purchase. It appears that combination is okay to you.

I think there's a good chance mandatory purchase will be found unconstitutional. If so, we'll have to cross that bridge. There are other ways to accomplish much the same thing.

So what you're looking for is a next step that eliminates the tax preference for employer provided insurance and requires that providers publish standard rates and maybe some quality information? If so, I can agree with that.

Yes on all counts. If we go down this road, we'll need government assistance to encourage an efficient market. Standardized basic policies, quality information, pricing information at least available in a standardized format (the companies can make whatever additional marketing info they want, but the "standardized" version must be available to facilitate comparison shopping).

I think that still leaves Medicare as a problem. Even with publicized rates, I think most people will choose whatever their doctor recommends. Maybe you are also looking for a significant increase in deductibles for both pre-65 private insurance and for Medicare?

Medicare is still a problem, but getting the above steps accomplished would be a huge improvement. It might also pave the way for Medicare reform. Once the "exchanges" are up and running, it's a short hop to allow seniors to opt in to similar "senior exchanges" with their govt-provided Medicare "voucher" as full or partial payment. There would be much to work out (would this be guaranteed issue at a fixed price, or complete with medical exams and underwriting? etc.) The problem is less thorny, because taxpayers are already paying for the "sickest" patients now. The only trick is to assure any selection process (by insurers or recipients) doesn't result in a huge new hemorrhage of taxpayer $$ to insurers or patients (as benefits). "Luckily", Medicare as constructed my be wasteful and inefficient enough right now that we don't need to get things perfect in order to make things better.

 

[Independent]

Yup. This market isn't efficient without some government actions. Standardized policies is a good idea. I believe we already do that with Med Supp.

The "Medicare Advantage" program is an attempt to get private plans into Medicare. It seems economically similar to a voucher program, though the individual never sees the voucher. Here's one CBO report: http://www.cbo.gov/ftpdocs/82xx/doc8268/06-28-Medicare_Advantage.pdf

I'm pretty sure the idea was to test whether private plans could be more efficient than gov't run Medicare. This report references MA plans higher administrative costs but better utilization controls as if that's already determined by some prior study. It looks to me like the whole experiment is messed up by what appear to be excessive "benchmarks".

 

[samclem]

An interesting report.

It looks to me like the whole experiment is messed up by what appear to be excessive "benchmarks".

Yes. "We set an overly generous target price, they bid under the target price, but the government only kept 25% of the difference. Boy, these plans sure are expensive."

There's also some debate about how various studies count "admin costs". Sometimes traditional Medicare gets credit for having lower admin expenses than it truly does.

 

[cb7010]

I am shocked over 50% would prefer a comprehensive government run option..

1. The government has proven themselves inefficient managers of most things they dabble in, thus, I would prefer them out of the health care business entirely. This includes all of the regulations they have put in place to inhibit competition. Private charity is much more efficient if the idea is to help less fortunate citizens.

2. Healthy people will subsidize the care of unhealthy people. Plus, some would argue that having care that you don't have to pay for promotes unhealthy and risky behaivor.

3. It's immoral in my opinion to steal from your neighbors. And, forcing them to contribute to a health system that they don't agree with, is in essence theivery. Come up with a system that allows for opting out and where participation is 100% voluntary, then I might change my mind.

 

[Katsmeow]

3. It's immoral in my opinion to steal from your neighbors. And, forcing them to contribute to a health system that they don't agree with, is in essence theivery. Come up with a system that allows for opting out and where participation is 100% voluntary, then I might change my mind.

So, of course, you feel it is immoral and theivery to require people to pay school taxes and taxes to support the police department and fire department and, most assuredly, to require people to pay for the defense of the United States. Or, even better, I could when I pay my income taxes (but I guess all of them are theivery) to say that $X can go to this program that I like but $X can't go to these other programs that I don't like. The reality is that we can't do that. Paying taxes is required whether I agree with how the government will spend it or not.

The point being that part of having a government and being part of a country and not just living in anarchy is that certain activities are considered to be part of the common good and that the populace can be taxed to pay for them. Determining what is part of the common good and thus worthy of taxation is the purpose of our elected representatives. There are constraints on what the representatives can do since we have a Constitution.

I can understand (although I don't agree with) an argument that health care doesn't enhance the common good and therefore the government has no concern with it and can't require people to contribute to it. But, if the vote goes the other way then that isn't theivery any more than it might be theivery to require me to pay school taxes even if I disagree with what the public schools are doing.

I can also understand an argument that requiring people to pay for health care is somehow something not allowed under the Constitution. I must admit I have a problem with that since there are so many other taxes and fees that are required. I also have a hard time seeing how health care for people under 65 is somehow theivery and has to be 100% voluntary but Medicare is great....

 

[M Paquette]

2. Healthy people will subsidize the care of unhealthy people. Plus, some would argue that having care that you don't have to pay for promotes unhealthy and risky behaivor.

Yeah. None of that nasty risk pooling! We all know that if you live a clean, wholesome life with no risky behavior that nothing bad will ever happen to you, so why should you have to pay for the undoubtedly well-deserved misfortune of somebody else.

I applaud you for realizing that you will never have unexpected medical problems.

Innumeracy. It's more than a lifestyle. It's an ideology!

 

[cb7010]

From my perspective, almost all of the areas you list (schools, police, fire, I could even make a case for defense) should be privatized and not run by the government. The federal government, through it's constructive use of the constitution, has expanded its power and influence far beyond what the constitution and its framers ever intended. One of the problems that I see is that the general population in the US simply takes central government control for granted because that is all they have known in their lifetime; when the reality is that the founders of this country never intended for the government to ever get this big or this powerful in controlling the States and our lives individually.

Further, our elected officials have become more and more beholden to special interest money and tend to be more concerned with their own personal gain and continued employment than doing what is right for the country. Thus, I say we should limit the things the govnerment does to the few items clearly enumerated in the constitution.

If you have no children, then you should not pay for schools, unless of course you wanted to then you could write a check to any governmental agency or school district you wanted to. If you want fire or police protection, then you can choose to pay for this protection. And, justifying anything new just because we already have a million taxes and government agencies is just a recipe for more of the same.

And, if you ask me..Medicare is not great. It's simply another case of one group of people benefiting and another group paying for it. In fact, our entire tax and entitlement system seems to have become a competition by all to get more out than they pay in. Apparently, there is a free lunch for some and I am simply not a fan of the path this type of system is taking us down...

 

[GregLee]

... far beyond what the constitution and its framers ever intended. ... the founders of this country never intended for the government to ever get this big or this powerful

Yes, but so what? The founders and the framers are long dead. What does it matter what they intended? Let's move on now.

 

[cb7010]

If I have unexpected health problems, then why isn't ok for me to choose how I deal with that? I can enter into a private, voluntary insurance plan or I can pay for care with cash or I can roll the dice and have no coverage and die..I just can't fathom thinking that other people would have an involuntary obligation to pay for my mis-fortune. Using the healthy v. unhealthy comparison is just to proove a point by using emprical statistics on how lifestyle impacts health and costs of care. The real issue here is if it's ok for any one of us to expect their neighbor to be forced to pay for their health care costs, whether a result of poor lifestyle choices or just bad luck. To be clear, I have no problem with insurance or pooling, so long as it's completely voluntary. The reality is that the rich will be able to buy better health care than the poor can afford and these types of benefits of being rich will continue to drive people to work hard, to compete, to innovate and to try to elevate their position in society so they can afford things like better health care. Allowing people to succeed and to fail based on their hard work and natural capabilities if simply in line with natural law and is what mostly drove the US to prosperity over the first couple hundred years of its existence.

Hey, at the end of the day, this is just my opinion on how things should be and how they might work better. I am sure there are many historical examples of how socialist societies have prospered over the long term and so long as they were based on voluntary socialism, I've got no problem with people choosing that way of living.

 

[cb7010]

Are You Serious?

Yes, but so what? The founders and the framers are long dead. What does it matter what they intended? Let's move on now.

On the other hand, you make a good point. Hey, the constitution was written over 200 years ago, why should we bother worrying about it

 

[FinanceDude]

Yes, but so what? The founders and the framers are long dead. What does it matter what they intended? Let's move on now.

And so they teach in law schools. They tell law students that is they start quoting the Constitution, they've already lost their case..........

One local judge was interviewed several years ago by a reporter. She asked something about the Constitution and its place in law, and the judge deadpanned: "The Constitution? That document is merely a formality, and has no place in today's courtroom"............

 

[GregLee]

And so they teach in law schools. They tell law students that is they start quoting the Constitution, they've already lost their case..........

To say that original intent of the framers is no longer important, as I implied, is entirely different from saying that the Constitution (and the body of Constitutional interpretation and Constitutional law) is no longer important, which I did not imply and do not believe.

 

[ziggy29]

One of the problems that I see is that the general population in the US simply takes central government control for granted because that is all they have known in their lifetime; when the reality is that the founders of this country never intended for the government to ever get this big or this powerful in controlling the States and our lives individually.

I don't disagree completely, but the world is a much different and much more complex place than it was in 1787. Trying to strictly apply 1787 rules to the society of 2011 isn't workable. Our economic structure and international trade and diplomacy are just too different to cling to 'original intent' as gospel.

We've gone from an agrarian nation of family farmers to an industrialized nation dependent on corporate employers to (perhaps) a post-industrial nation where jobs are vanishing but the ability of folks to self-employ just isn't there (add employer-sponsored health insurance to the reasons, among others). Strict application of a 1787 framework to today's problems, while a fair starting point, ain't gonna get us there.

 

[ziggy29]

To say that original intent of the framers is no longer important, as I implied

I disagree. The original intent is (to me) the default Constitutional position to take. I would agree, however, that it should not be inviolable gospel. For all we know, the founders may have written the document to provide enough wiggle room for changing interpretations with the times. (And maybe not.) We don't know this.

 

[ERD50]

I disagree. The original intent is (to me) the default Constitutional position to take. I would agree, however, that it should not be inviolable gospel. For all we know, the founders may have written the document to provide enough wiggle room for changing interpretations with the times. (And maybe not.) We don't know this.

I think there is evidence in the fact that they allowed for and defined an amendment process. If they intended it to be 'gospel', they would have said "No Changes!".

But the amendment process is not meant to be easy, it needs a 2/3rd majority in both houses, and 3/4 of the states must approve it.

-ERD50

 

[Katsmeow]

Here is the issue. Some would say that in construing the Constitution you look at the actual words that are used and interpret those words as those words are interpreted when used in the modern day.

Others would say that you look at the actual words but you interpret them as those words were used at the time of the founders.

Still others would say that you dont' really use the actual words, rather you try to apply the subjective "intent" of the founders at the time they wrote the words. The problem with that is that it tends to become politicized. You end up with people saying well you don't to give freedom of religion to Muslims because the founders would have been cool with discriminating against Muslims. And actually the founders would have been cool with a Christian nation but just didn't want to discriminate between Christian denominations.

Republicans tend to be associated with the latter two ways of interpretation but not always. Democrats, for example, tend to want to interpret the 4th amendment using a definition of militia from the time the amendment was written and tend to rely a lot on founders' intent.

And of course that is the problem with relying on founders' intent. It makes interpretation subjective and makes it easy to politicize (for either side).

 

[samclem]

You end up with people saying well you don't to give freedom of religion to Muslims because the founders would have been cool with discriminating against Muslims. And actually the founders would have been cool with a Christian nation but just didn't want to discriminate between Christian denominations.

Unlikely that anyone could make a convincing argument along these lines. Some of the key founders were deists, not Christians.

From the Treaty of Tripoli, ratified by Congress on June 10, 1797 and signed by President John Adams:

As the Government of the United States of America is not, in any sense, founded on the Christian religion; as it has in itself no character of enmity against the laws, religion, or tranquility, of Mussulmen; and, as the said States never entered into any war, or act of hostility against any Mahometan nation, it is declared by the parties, that no pretext arising from religious opinions, shall ever produce an interruption of the harmony existing between the two countries.[3]

"Musselmen" is one of those older words to which you refer, it means Muslim. In modern usage we use "Muslim" instead of "Mahometan" as well.

Democrats, for example, tend to want to interpret the 4th amendment using a definition of militia from the time the amendment was written and tend to rely a lot on founders' intent.

I think you mean "2nd Amendment."

 

[GregLee]

Here is the issue. Some would say that in construing the Constitution you look at the actual words that are used and interpret those words as those words are interpreted when used in the modern day.

Others would say that you look at the actual words but you interpret them as those words were used at the time of the founders.

I don't think there would be many proponents of the first view. In considering the meaning of the words written in the Constitution, of course, to find that meaning, you need to take into account changes in idiom since the time those sentences were composed. That's "original meaning". But "original intent" is the effect on the Republic which the framers thought their words would have, and that expectation was a product of a time and a society very different from our own.