By John C. Goodman
Originally posted at Springfield Business Journal, March 2018
Critics charge that the United States has the most expensive health care in the world and the worst results.
Don’t believe it.
The reason why Arab sheikhs and heads of state from all over come to this country for health care is that we offer the very best. Cancer survival for the U.S. population outranks just about every other country in the world, according to WebMD.
As for cost, the market has been so suppressed in health care that no one ever sees a real price for anything. However, if we ignore artificial prices and focus on real resources, the U.S. actually looks pretty good. Based on 2013 data from the France-based Organization for Economic Cooperation and Development, we have fewer doctors per person than the OECD average, and we have fewer doctor visits. We also enter the hospital less often than people in the average OECD country, and once admitted, we spend fewer days there.
When the left gave us “Obamacare,” some people saw their premiums double and triple in just a few years. That’s for insurance with narrow networks that exclude the best doctors and the best hospitals. On top of that, 30 million people are still uninsured.
Now the left wants to replace Obamacare with a single-payer system, by which they usually mean Medicare for everyone. But Medicare for all will not solve a single problem of any importance that we currently experience under Obamacare.
Four questions arise:
1. How much would you have to pay? Would premiums vary by age? By health status? By income? All of these issues have been big problems in Obamacare, and they don’t go away by relabeling the program as Medicare.
Remember, if someone is underpaying, someone else is overpaying. For those who are overcharged, the temptation is to opt out altogether and remain uninsured until they get sick.
It’s no answer to say that Medicare should be funded by compulsory taxation. Why would people vote to pay in taxes when they chose to avoid voluntarily paying in premiums?
2. Would there be a mandate? This highly unpopular feature of Obamacare will go away next year. Would it return with Medicare for all? Last year, about 7.5 million people chose to pay a fine rather than buy very unattractive health insurance. When the mandate goes away, there will be many more.
3. What about employers? For people at work, there would be enormous pressure to continue the employer contribution by requiring business owners to buy their employees into Medicare. That would raise the issue of exempting small businesses and part-time workers, etc. These are the same issues we grapple with today.
By one estimate, national health insurance would cost about 15 percent of employee wages. Will workers want to turn over 15 percent of their pay and benefits to the federal government to manage? There is no evidence that they will.
4. What about the exchanges? Although the left doesn’t seem to know it, Medicare isn’t really a single-payer system. About one-third of enrollees have private Medicare Advantage plans through an exchange. Every problem Obamacare is currently experiencing with the exchanges will remain.
This article was originally posted at Springfield Business Journal on March 29, 2018.