The Health Care Reform Debate In Perspective

As everyone paying attention has seen, I've done a lot of writing about health care. A lot of it has been in much the same vein as every other liberal-to-socialist blogger on the blogosphere: criticism and polemic on the debate itself. As I've noted before, there's a lack of excellent writing on the substance of the debate. I've decided to try to address the substance again, partially because new readers who find me 'more liberal than radical' may not have seen my earlier commentary on the substance of the debate and partially because I'm still not terribly satisfied with the final form health care reform is taking despite my pleasure that it looks like some basic problems will be addressed.

First and foremost is the substance of the reform actually being discussed in Congress. The right-wing advocates of market reform and the left-wing advocates of national health care policy have both been excluded from the debate. As I (and others) have said before, what is being debated in Congress now is insurance reform. Insurance reform is better than no reform at all. It certainly addresses the real problems of health care in America better than market reform as advocated by the right.

Those problems, which I have also written about before, are basically three-fold:

1.) High consumer costs generated by the inefficient pooling of costs in multiple payment pools. This means multiple partially funded systems of payment and no single fully-funded pool of shared costs. This is entirely opposite to the principle of shared cost. Whereas other insurance can survive this way because it covers against the unexpected, everyone will need medical care at some point in their lives. Thus the inefficiency of the cost-sharing method has a mushroom effect on consumer costs. When one adds to this the cut the insurance companies must take from the consumer to make a profit it only gets higher. So while medical costs really do rise as technology changes, the consumer costs created by our insurance system are the biggest cost problem.

2.) Access to proper care is restricted in a variety of ways. The uninsured frequently forego all but the most urgent care (which is much more expensive) for financial reasons. Insurance companies frequently make their customers jump through hoops to make full use of their benefits, or deny payment entirely if it suits them to do so. Medicaid is difficult to receive (indeed, many of the people who need it are ineligible because of the family requirements) and offers inferior service. Medicare and the Veterans Administration only serve specialized portions of the economy. Thus many people cannot afford to see a doctor, believe they cannot afford to see a doctor, or choose not to see a doctor because they prioritize other financial needs before medical care. Even when one has coverage, there is no guarantee the insurance company will provide full access to necessary care under the current system.

3.) The current health care system puts a tremendous burden on American business. The majority of people with insurance who are not covered by Medicare or Medicaid receive health insurance benefits through their workplace. This infringes their economic freedoms (because their benefits tie them to their job) and it also shifts much of the cost of health care onto the business sector as a de facto tax burden. This latter aspect is worth taking into account among the many problems with American economic policy. I'm no friend of corporate culture, as anyone who reads my stuff knows, but forcing the corporate sector to underwrite what most of the world considers a national issue and a government responsibility is... of questionable capitalist virtue.

The current health care reform proposals in Congress primarily address problem #2. They would require insurance companies to open access to more care to their customers and restrict them from simply dropping their customers or refusing to pay for a variety of reasons. This is a huge improvement not to be ignored. However, it is key to remember that the first and third problems with our current system are only addressed tangentially if at all.

The focus on costs is on medical costs, not consumer costs. While medical costs are a real issue, they are secondary. A better system for paying consumer costs would lower them dramatically without the need to focus on medical costs that can probably not be cut to the degree believed by the advocates of insurance reform. The creation of a competitive, national insurance exchange will probably lower consumer costs somewhat... but it is difficult to say how much and it is possible it won't have a real impact because of the increased standards of quality may keep consumer costs higher than desired. A competitive, robust public option might help to drive costs down somewhat... but it is again very difficult to say how much this will help the guy who already can't afford to buy private insurance.

The economic problem is ignored entirely. First (and perhaps worst) it is assumed that everyone with employer-paid insurance is happy with their coverage and that there is no need for reform of this market. My partner's experiences following surgery have shown, to me, the facts are very different. Employer-paid insurance is in much the same state as private insurance, whether the premiums are lower or not. The public option, as it stands now, would not be available to anyone receiving employer-paid insurance.

In addition, liberals appear to believe that corporations can and should foot the bill instead of government. They advocate increasing employer's responsibility to provide insurance to their employees and punitively taxing those who do not. This may serve the needs of PayGo, but it is aggravating rather than solving problem #3.

None of this is intended to suggest that the insurance reform being discussed in Congress is not better than our current situation. It is. Nor is it meant to rally opposition to said insurance reform. If nothing else can pass, insurance reform needs to pass.

It is meant to put the problem in its proper context and to instill an understanding that this reform is not the 'end' of health care reform. It is a first, shaky step in the right direction. The issues of consumer costs and economic burden will remain to be addressed, and the left must not forget that. We must continue to raise and address these issues to affect future policy debate as much as possible.

To put it more simply, we need massive reform and even the 'liberals' in Congress are not approaching the problem from a sufficiently radical direction. We should support them, but we should keep pushing in the wake of their success.