Note: I did not write this article - it is crossposted from the somethingawful forums. Please feel free to crosspost this anywhere you like.
There have been a lot of debates and discussions recently, both on this forum and in other venues, about the state of healthcare. Looking at the rising costs of health insurance, and at the growing numbers of the uninsured, many are calling for government intervention, and the institution of a system where care is guaranteed to all - usually described as "universal" healthcare. It's a fascinating topic - the issues involved include humanitarian, financial and ideological ones. Unfortunately, debate on the subject is characterised by a startling phenomenon: one side is right, and the other is completely wrong.
Given the importance of medicine, I feel that it would be useful to clarify this issue. I will explain clearly, and with evidence, why it is that universal healthcare of any sort would be better than the current system in every significant way. If you find yourself disagreeing with this assertion, I ask that you read on before replying, as all conceivable objections will be addressed and resolved.
Why The Current Situation Is Bad
At the moment, healthcare in America is provided mostly by private entities, who charge high fees. These fees can be attributed largely due to the difficulty and expense of the medical profession, and although they are significantly higher than those of similar nations this difference is only a small portion of healthcare costs. There then exists the health insurance industry, a loose network of corporations that charge individuals or organisations premiums and will pay for their health costs if any are incurred.
Unfortunately, this system has enormous problems. As of 2006, 44.8 million people in America do not have health insurance. Many are unable to afford it, many are denied coverage by insurers who believe that as customers they will not be economical, and others choose not to purchase it. Without health insurance, the up-front costs of health care are impossible for most people to afford. In fact, 50.35% of all bankruptcies were caused, at least in part, by medical fees. In 2001, this was 2,038,549 bankruptcies.
Furthermore, health insurance does not fully cover medical expenses. Different insurers and different plans have many exemptions, co-pays, threshholds and other expense-minimising devices. As a result, 62% of those two million bankruptcies occurred despite the debtors having health insurance coverage for the duration of their illness.
As well as failing to provide care, and driving individuals into bankruptcy, the existing system is also exorbitantly expensive. Health care spending is now 15% of U.S. GDP - the highest in the world. The costs to businesses, who commonly pay premiums for their employees in lieu of salary, rose by 13.9% in 2003. The annual cost increase has been above inflation since at least 1981. Paying more doesn't result in more value, either - obesity, diabetes, and similar disorders are more common in the United States than anywhere else in the developed world, the U.S. is ranked 72nd in overall health, and life expectancy is below that of 41 other countries.
What Is Universal Health Care?
Universal Health Care, or UHC, refers to a wide range of different systems, the common characteristic of which is that a nation's government guarantees all its citizens access to healthcare. Every developed nation (OECD member) in the world, apart from the United States, has a UHC system. There are three main types:
In a fully public system, there is no or little private healthcare, and the health insurance industry is not a significant one. Medical service providers are government employees, and the education of doctors is also subsidised. The most well known example of a fully public system is the original English NHS, although a private sector is now developing in the U.K. as well.
In an optional public, the government provides the same services, but a private health services industry also exists (generally regulated), and . Sometimes health insurers exist, used by people who prefer private services. This is the most common, and examples include Australia and Sweden.
In a subsidised private system, the government pays for health care, but it is provided by private entities. Either the government acts as a health insurer for the populace, or it pays the fees for private health insurers to do so. This is done in Canada.
For the purposes of discussion, I will be assuming the characteristics of an optional public system, like those used in most of Europe. However, the benefits of UHC apply to all of the above types of organisation.
How UHC Will Improve Things
The single largest problem with healthcare in America is that many people don't have it. It's obvious how UHC solves this: by providing it to all citizens directly (or paying for it to be done). By definition, this is no longer a problem under UHC. All developed nations other than the United States make this guarantee to their citizens, and have so far been able to uphold it. The two reasons which make a person uninsurable - insurer decisions and lack of money - will no longer exist.
The second major problem with the current system is its high cost. This can be divided into two parts: individual cost, and government cost - which to the individual shows up as taxation. UHC is inherently cheaper - far cheaper - due to economies of scale, the bargaining position of monopolies with regard to drugs and salaries, reduced administrative costs, and the lack of a profit motive. When it comes to individual health care costs:
According to the World Health Organisation, average American individual spending on healthcare is $3371 per year. Since this includes the uninsured and those covered by their employers, actual costs are higher. For comparison:
Australia: $1017
Canada: $916
Sweden: $532
United Kingdom: $397
The first of those is the second-highest in the world - meaning that Americans pay, not including taxes, more than three times as much as citizens of any other nation. This would be somewhat justifiable if they received better healthcare, but again - 28% have no care at all, life expectancy is below all other developed nations, and general health rating is below all other developed nations.
It is commonly assumed that this difference in cost is because under UHC systems, higher taxes are required to fund the system. Not so. As mentioned, UHC is a great deal cheaper than private healthcare, and as a result America's health-related taxation is also the highest in the world. According to the OECD, in 2006, American government spending on healthcare was $2887 per person. For comparison:
Australia: $2106
Canada: $2338
Sweden: $2468
United Kingdom: $2372
American healthcare taxes are in fact the highest in the OECD, with France second at $2714. In conclusion, every single UHC system in the world costs less money for individuals, requires lower taxes, and provides better care to more people than the American health care system. By implementing UHC in the U.S., things can only get better.
Frequently Raised Objections
There are many incorrect arguments against the implementation of UHC in the United States. In order to better facilitate discussion, I will explain the errors found in the most common.
"America isn't Europe!", or It Won't Work Here The argument from American exceptionalism states that what works in Europe will not work in the U.S. It's said that this is because European nations have more people in less space, resulting in less logistical difficulties, and because European government is more competent.
Firstly, not all developed nations are European. The most obvious example that counteracts the logistical argument is Australia, where there are 20 million people in only slightly less space than America's 300 million. This does indeed affect prices, as can be seen by comparing Australia to Sweden or the U.K. - but it doesn't bring them anywhere near the levels currently experienced in America.
The argument that American government is uniquely incompetent, and cannot do things that every other nation in the world can do, is simply nonsense. Not only has America, and American government, achieved many things that other countries have not, America has so many resources and the improvement in care and cost from moving to UHC is so large that even with incredible inefficiencies it would still be a good idea.
"It is immoral to force me to pay for others' healthcare." You are already paying for others' healthcare. Furthermore, you are paying far more than you would be under UHC. The U.S. government incurs massive costs from paying hospital fees when ER visitors have no money, and from the limited coverage that it provides, which cannot take advantage of economies of scale and which has to subsidise corporate profit.
As demonstrated above, U.S. taxes devoted to healthcare are the highest in the world. Even if you choose not to have health insurance, under the current system, you are still paying more for others' healthcare than you would be paying for theirs plus your own under UHC.
"This is socialism." It is not socialist to recognise that there is a service the free market is inefficient at providing, and to decide it should better be provided by the government. Even the most staunch libertarian admits that there are some services in this category, such as national defence.
Secondly, it is irrelevant whether this is a "socialist" policy; it's effective. It costs less and provides better care to more people, and as a result is used literally everywhere else in the entire world. Those who want to ensure that society remains ideologically committed to market capitalism need to look for other issues, as if they cling to this one they will only end up providing evidence against their position.
"I don't want more government bureaucracy." UHC will involve much less bureaucracy than is commonly assumed, as it can replace the existing partial systems like Medicare and also the plethora of state-specific programs. Regardless, the lives and money saved are more important than any potential expansion of the state.
"Why don't we try making the system even more private instead? That might help." It might. However, there's no evidence to suggest it, and many reasons to presume it wouldn't. By its nature, the less publicly-supported a system, the more people will be unable to purchase health services.
The only potential gain would be reduced costs due to some sort of market mechanism, and in practice this has never occurred; every private healthcare system that has ever existed in world history has proved inefficient and been replaced by public systems, and given the demonstrable gains that have resulted the U.S. must follow.
"Doctors will be paid less." They probably will. In nations with UHC, doctors often earn less - for example, U.S. doctors earn 30% more than Canadian doctors - but this isn't an inherent problem. It is still one of the highest-paying professions in the world, and there are many other ways of attracting skilled people to medicine - such as subsidising their education.
It is sometimes claimed that doctors paid less in a country with UHC will instead go elsewhere where they can be paid more, but once the U.S. has UHC there will not be an elsewhere to go.
"Medical research is funded by the payments of the rich in the current system, and will be reduced." It is not true that most medical research is done in the United States. In 2000, U.S. research spending was $46 billion, but European spending was also $43 billion. And although U.S. research spending doubled in the last decade, the funding's efficacy has actually decreased.
Secondarily, if the option for private healthcare still exists - and there is no reason why it should not - there will still be people choosing to pay more for a higher quality of care, faster service, et cetera. Their profits will still be reinvested in the development of new drugs, equipment and understanding of the human body, as they still are in nations with UHC today. Even in the United States, private spending accounts for only 57% of research spending.
"With the option of private healthcare, the rich will 'opt out' and costs will go up." This isn't necessarily true at all; although private healthcare is usually allowed in UHC nations (for good reasons), it doesn't have to decrease the taxes paid by all to support the public system!
"Other countries fix drug prices, so the US has to pay more for drugs." This is another common misconception. U.S. healthcare does not include higher pharmaceutical spending than other countries; it's around the average or even slightly lower. From the OECD:
Canada: 17.7%
Germany: 15.2%
Iceland: 13.3%
Australia: 13.3%
US: 12.4%
Sweden: 12%
Ireland: 11.6%
In Conclusion
Thank you for reading. To those who were not previously supporters of UHC, I apologise if anything seemed condescending, but there's no shame in being wrong due to not having all the facts or having been misled. If anyone has questions feel free to ask, and hopefully we can now discuss what sort of UHC system ought to be implemented or how the political will for it can be gathered, rather than being bogged down by misconceptions about its desirability.
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Compare it to public schools. Does it work? The further the worse public schools teach children. What are proposed solutions in US? School vouchers. That is the taxes are returned back to people (while redistributed) and they choose the school which is better for their children. Frequently they might need to pay additionally for the good school. Thus the competition within schooling industry is raised. Thus teachers (good ones) are able to get higher salaries.
Is there similar solution for healthcare which would enable the industry to survive and not turn into yet another female-dominated underpaid public one?
I'm a Canadian, and I'm pretty sure I can choose whatever doctor, hospital, or clinic I like, assuming they have enough time to slot me in. I'm lucky in that I don't need to use the health care system very often, so I'm not 100% on this, but I've never been told that I need to go to X clinic or Y doctor if I want to be treated. I know there are some restrictions; I don't believe things like homeopathic medicine are covered. But in general, I think I can see any doc in the province that is willing to give me an appointment. I just give them my carecard, which I suppose works a bit like a voucher? I'm really fuzzy on the details, haha.
Health care professionals are either underpaid here or overpaid in the US, because they seem to be migrating south in droves. It can be difficult to find a regular family doctor. I think that has more to do with the way the pay is set up than any restrictions on our ability to choose the best doctors.
So the goverment pays all the bills, right? Who does determine how much should it cost to do "whatever specific medical service". It seems it is goverment who does it, otherwise doctors would put very large sums in bills.
So the goverment sets the price and eventually the salaries in this event formally private sector. No wonder doctors flee the country.
I disagree about the school comparison. I actually support voucher programs and universal healthcare. There's a big difference between education and healthcare. No one's going to die if they don't go to school, and voucher systems would not take schooling away from anyone anyway, but give families options so that they can take their children out of a bad school.
I think providing for healthcare is more important than providing for education anyways. I'm sure most parents in a tight situation would spend whatever savings they had on life saving medical procedures for their child over private schooling.
Jeniann, then what do you suggest?
If you don't believe Russian long experience with universal healthcare (I wrote about it in recent post) look at Swedish and Finnish one. Nurses salaries are VERY low there. They earn just a little more than those people who don't work at all and get unemployment benefits from the goverment. Recently there were global nurses srikes in Finland and Sweden (http://www.thelocal.se/12072/20080528/). You see, one of the highest taxes in the world cannot make decent wages for people in the healthcare industry.
Thank you for this. Regarding the even the "partial" Medicare system of the US, mainly for the elderly, please note that according to sources cited in the relevant Wikipedia article
http://en.wikipedia.org/wiki/Medicare_(United_States)
"The Medicare hospital insurance trust fund will become insolvent by 2019."
also, quote:
Richard W. Fisher, President of the Federal Reserve Bank of Dallas has remarked that in order to "cover the unfunded liability" for the Medicare program today over an infinite time horizon, "you would be stuck with an $85.6 trillion bill" which is "more than six times the annual output of the entire U.S. economy." The present value of unfunded obligations under all parts of Medicare during FY 2007 over a 75-year forecast horizon is approximately $34.0 trillion.
That's $34,000,000,000,000 today, or $85,600,000,000,000. That's over $111,000 for every man, woman and child in the US to pay off, right now.
How does anyone propose we pay for this? Please note according to the public debt article on Wikipedia: "By comparison, total U.S. household assets, including real estate, equipment, and financial instruments such as mutual funds, was $62.5 trillion in 2005." In other words, we could turn over ownership of ALL private assets in the US to the government, nevermind raising taxes, and still not have enough to pay just for Medicare, just for the elderly, (based on the current real estate and financial bust). What do we call it when there is no private ownership?
You're right, Europe, Canada, and other countries with public health care are not so different. They will experience reductions in services and financial problems as well, despite their successes today.
There's something I want to remind people of before they go giving negative ratings to my recent comments on universal health care.
I support universal health care. People deserve quality health care, subsidized by government, at little or no out of pocket cost to themselves. I have 12 years experience living in a country, Japan, with a national health insurance system. It is not a true form of socialized medicine (30% co-payment, but fees are quite reasonable), but it is close. I have seen and experienced how subsidized health care works, as a consumer, and as a health care professional.
I also support Sen. Obama. I have only voted Democrat since the age of 18 (22 years ago), and do not want Sen. McCain or Gov. Palin near the White House.
Today at work, I saw a clip of Sen. Obama speaking on CNN. He told an enthusiastic crowd that people earning less than $250,000 a year would not experience any increase in taxes or withholdings from their pay. In addition, he envisioned that the 50 some million people in the US without health insurance would enjoy the same level of coverage as a member of Congress like himself. Of course the vast majority of people would support this, because such a level of income does not represent them.
How uncommon is an income of $250,000 a year? According to 2007 census figures (please make your way through the menu)
http://www.census.gov/hhes/www/income/income07.html
Table HINC-06. Income Distribution to $250,000 or More for Households: 2007
a household income of $250,000 a year represents only 1.9% of households in the US in 2007. (Note: I've never been clear - when Sen. Obama talks about people earning $250,000 a year, does he mean individuals or households? Because if he means individuals, that is a significantly smaller number than 1.7% - the Census Bureau doesn't even report individual income figures that high in this release.)
So anyone, please tell me: How are tax increases on approximately 1.9% of households going to support all the rest of us? How are 2 million households going to support all 117 million households in the US?
I also invite anyone to pick up a copy of Medicare & You 2008, a September 2007 release from the Centers for Medicare & Medicaid Services, an official government handbook. Peruse it to see for yourself how limited even the US government admits its health coverage is, even for the limited number of people (those 65 or over, or under age 65 with certain disabilities, and "any age" with End-Stage Renal Disease) eligible for coverage. [Actually, the Wikipedia article is a good summary.] Please see for yourself how exclusive this health coverage is. Please see the differing levels of coverage (from 0% to 100%) that exist, how much premiums cost for differing levels of coverage, and what is NOT covered, e.g. dental care and dentures, routine eye care, routine or yearly physical exams, and most prescription drugs (there are even Medicare plans that cover NO DRUGS AT ALL). Are you surprised? I am. Even my health coverage is better than that.
Well, make it so Medicare/Medicaid DOES cover all necessary care, treatment, drugs, vision and dental, you may say. I agree, that would be great. I am in support of that, as well.
According to a September 18, 2008 report, "Testimony--Using What Works: Medicare, Medicaid, and the State Children's Health Insurance Program as a Base for Health Care Reform"
http://www.commonwealthfund.org/publications/publications_show.htm?doc_id=706151
"Currently, more than one of four Americans, or some 83 million people, are covered by Medicare, Medicaid, SCHIP, or other public programs."
This report, like a number of others I have read, holds up Medicare (or Medicare/Medicaid) as a model for publicly subsidized health care for all in the US, over 305 million of us.
So, just over one in four people in the US have some sort of public health coverage, with varying limits on coverage. Also according to Wikipedia:
"In 2003, Medicare accounted for almost 13% of the entire federal budget. Based on the CMS projections, 33 cents of every dollar spent on health care in the U.S. is paid by Medicare and Medicaid (including State funding).[citation needed] Looked at from three different perspectives, 61 cents of every dollar spent on nursing homes, 47 cents of every dollar received by U.S. hospitals, and 27 cents of every dollar spent on physician services is funded by Medicare or Medicaid.[citation needed]"
Please look into the many problems with the US Medicare/Medicaid system. Try making it work in the foreseeable future, a problem also faced by Canada, Japan, and countries in Europe. Unlike most of those countries, the US is experiencing positive population growth, and its tax base is not shrinking, thanks to the influx of immigrants and birth rates among non-white people. There will be an increasing number of people to pay taxes in the US.
Nonetheless, the Medicare/Medicaid system is financially unsustainable in the long run. "The Medicare hospital insurance trust fund will become insolvent by 2019." As cited by the Medicare article on Wikipedia:
[start quote]
Richard W. Fisher (2008-05-28). "Storms on the Horizon". Federal Reserve Bank of Dallas. Retrieved on 2008-06-18. "
Medicare was a pay-as-you-go program from the very beginning, despite warnings from some congressional leaders—Wilbur Mills was the most credible of them before he succumbed to the pay-as-you-go wiles of Fanne Foxe, the Argentine Firecracker—who foresaw some of the long-term fiscal issues such a financing system could pose. Unfortunately, they were right.
Please sit tight while I walk you through the math of Medicare. As you may know, the program comes in three parts: Medicare Part A, which covers hospital stays; Medicare B, which covers doctor visits; and Medicare D, the drug benefit that went into effect just 29 months ago. The infinite-horizon present discounted value of the unfunded liability for Medicare A is $34.4 trillion. The unfunded liability of Medicare B is an additional $34 trillion. The shortfall for Medicare D adds another $17.2 trillion. The total? If you wanted to cover the unfunded liability of all three programs today, you would be stuck with an $85.6 trillion bill. That is more than six times as large as the bill for Social Security. It is more than six times the annual output of the entire U.S. economy."
[end quote]
Note: that is ONLY for Medicare, NOT Medicaid and all those other public health programs. Try dividing 85.6 TRILLION by 305 million people in the US today, to see how much people would be financially responsible for, on average. Just for Medicare and its limited coverage. If people in the US today had to pay that figure, that would be $280,656 each. I remind you, "By comparison, total U.S. household assets, including real estate, equipment, and financial instruments such as mutual funds, was $62.5 trillion in 2005."
Where will this money come from?
Translation: tell us how to pay for Medicare/Medicaid, as limited as they already are, as they apply to only about a quarter of people in the US, or 33% of all health care costs. How much will it cost for four times as many people today, and the untold hundreds of millions of people in the US in the future? Before you can really sit down and talk about what universal health care is going to do, you'll need to tell us how it will be accomplished. How it will be administered. How it will be funded. It can't be done in a sound bite, or a speech, interview or debate. Medicare & You 2008 consists of 116 pages for the Alaska/Hawaii/Guam/American Samoa/Northern Marianas Island edition. Perhaps Hillary Clinton had a way, but IIRC, that was 1,300 pages. Who's read it?
There are other problems with Medicare/Medicaid besides funding, such as a significant rate of waste and fraud (it's not much of a model of efficiency and cost savings), but you can look those up yourself.
Sen. Obama and anyone else can wish for things as they should be. (I will shock and bore you with the quality of life I believe people deserve, such as guaranteed income, food, shelter, health care, and safety for everyone. In the world. Completely unattainable by human beings.) Any politician can promise you something as it should be. How do they intend to do it? Sen. Obama is still unclear.
The current situation of our health care system needs to be address; many people are lack of access to health care. Nearly 47 million Americans are uninsured and the number keeps on increasing. Affordable health care is what we need. On the other hand, EHealthInsurance is a great idea – they have comparison quotes from area health care insurers so you can find a good price on health coverage. With eHealthInsurance, you may not need to get a payday loan every month just to pay for your health coverage. Health care coverage is vital, yet it has gotten more and more expensive to maintain over the years. When you factor in the added possibility of layoff during recession, it becomes a worrisome problem. Not everyone wants to pay the ultra high premiums of COBRA, which is exactly why eHealthInsurance is such a blessing – it finds the best price for what you want, the way the free market is supposed to work.
The current situation of our health care system needs to be address; many people are suffering due to lack of access to affordable health care. Nearly 47 million Americans are uninsured and the number keeps on increasing. Affordable health care is what we need. On the other hand, EHealthInsurance is a great idea – they have comparison quotes from area health care insurers so you can find a good price on health coverage. With eHealthInsurance, you may not need to get a payday loan every month just to pay for your health coverage. Health care coverage is vital, yet it has gotten more and more expensive to maintain over the years. When you factor in the added possibility of layoff during recession, it becomes a worrisome problem. Not everyone wants to pay the ultra high premiums of COBRA, which is exactly why eHealthInsurance is such a blessing – it finds the best price for what you want, the way the free market is supposed to work.