Tuesday, July 25, 2017

Single Payer Health Insurance and Federalism

 A frequent comparison brought forth by those who favor single-payer health insurance is to make note of nice places around the world where single-payer works well. If it is good for them, then it must be good for us. I’ll drink to that!

No I won’t. This kind of comparison is like saying if a shirt fits perfectly on a dwarf, then it should be great for portly me. Suppose single-payer is great in Sweden. Does that really mean it is great for the USA? Why don’t we see a single-payer system for all of Europe? Or for the EU countries? Or for the G20? The answer is simple. They don’t want it. These places I mention are not only big but they are also dissimilar. People in northern Holland don’t have much in common with those silly Limburgers. Can you imagine the Hungarians and the Germans wanting the same single-payer system? I can’t.

But the US is one country, you retort. States are not the same thing as countries. But pshaw, I say. I know a few New Englanders who can’t even say Mississippi with a straight face. The south is where those “deplorables” live. Without getting so silly, I cannot see folks in South Dakota or Idaho wanting to have the same single-payer system as the groovy people of California. And then there is the idea of a frugal state like Indiana pairing up with scofflaws in Illinois. The USA might be one country but that does not mean that we all live or think alike.

The proof is in the pudding – or shall we say our governing documents. We purposely created a federalist country composed of strong states. Today we continue to honor the federalist state in many ways. We find comfort in the idea that some king living on the east coast can’t tell us how to run our lives. Sure, we have a big national government that does a lot of things. But think about all the areas that are left up to states or cities or counties. Police, fire, education, zoning, roads, parking, and so on. This is not trivial stuff. State and local area government budgets and regulations impact us in major ways every day.

Why don’t we turn over the police departments to the national government? Why doesn’t the US Congress run our fire departments? I am sure that it is possible to make strong statements about the great efficiency or perhaps some sense of fairness that derives from national control. But the answer is simple. It doesn’t make sense. Locals better understand the local problems. Locals know how to create local solutions. And what might be fair in W. Lafayette might not seem so fair in Bloomington.

Some of our politicians and ideologues want us to believe that single-payer is a slam dunk for the USA. Since it is a fait accompli, then it follows that anyone against it must have ulterior motives. But the truth is that the case has not been made. Bernie Sanders can rant all he wants but that doesn’t make people in southern Georgia have the same health issues and problems as those who live in Brooklyn. It does not mean that because a small European nation finds single-payer ducky that a huge economic space populated by 330 million Hoosiers, Tarheels, and Buckeyes is going to love it.

Republicans are trying to make the case for healthcare reform. It is an uphill fight for many reasons. But one of the reasons is the apparent superiority of single-payer. Why isn’t single-payer being held to the same kinds of debate and logical standards? Why do we noddingly approve of single-payer as the words are spoken? 

11 comments:

  1. Great post, Prof! I have just one comment. You make the statement, "Locals know how to create local solutions." While true, more and more of our local pols are looking to DC with their hands out which seems to have become their "solution" to our problems.

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    1. Thanks Mike. While it is true that locals receive some of their funding from DC it is also true that locals know best how to use the money. If money is going to flow to local areas then I'd prefer its use be determined by those most familiar with how to make the funds work best.

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    2. True to an extent. "Handouts" from above always come with strings attached, and those strings are seldom in our interests.

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  2. Answer: No better idea has been thought of so far. the R's are offering tax breaks for the poor...they do not pay taxes so a break is not relevant. The truth is healthy people make for a productive nation....but who subsidizes the not so healthy? We pay an incredible amount of state, local and federal taxes for all kinds of self serving projects like $10M gym in the desert of Afghanistan where the beneficiaries are the government contractors.. my Medicare and SS payments over my work career add up to almost $50K which I hope I will never need much of but the part I do not use subsidizes somebody else....just give me what is due and I will be happy. My employees healthcare fees have gone up 10% per year with less coverage. A person with a $50K income per year pays more for healthcare than they pay for rent or a mortgage and the company picks up the other half. This is handled state by state but there is little difference. When I was young ( 1950's) I had two doctors and two dentist living on my street. They were middle class or maybe a little above. We had no health insurance because medical care was not expensive in proportion to my middle class family income.

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  3. In my opinion, the entire health care debate is a red herring. We continue to focus on acute care, intervention, and curative responses instead of preventative medicine. We need a radical change of focus to put the emphasis on reducing the overall health care burden.

    Instead of wrestling with the 600 pound gorilla in the room, maybe we should figure out how to reduce him down to a 300 pound gorilla, then try to tackle him.

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    1. Thanks for your contribution! Excellent point.

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  4. Single payer systems everywhere have problems that Americans will not tolerate as well as other countries. First there are panels that decide whether procedures or practices are allowed. Second is a long wait for specialists. Third is ever increasing costs. With many physicans today not accepting Medicare patients, this is not a solution for 80% of Americans.

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    1. Thanks Mr Yachts...if prices are low then something is needed to ration a scarce resource.

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  5. Dear LSD. HRC tried universal health care including an employer mandate. It failed to garner sufficient legislative and industry support. It failed. Obummercare passed, but has proven disastrous and is projected to implode without additional taxpayer money. Given the govomit’s proven performance of bloated bureaucracies, ineffectiveness (even the military can’t quell the Middle East) overruns, etc. it seems a reasoned conclusion that a single-payer system never would be the silver bullet some espouse.

    Some lifestyles will cause self-inflicted increased healthcare costs. Some won’t want insurance no matter the cost. Hospitals and service providers—both honest and fraudulent—will not be forced to reduce the cost of delivering care as long as insurers simply cover/reimburse those costs. Single-payer will not reduce the cost of healthcare—only transfer wealth from taxpayers to non-taxpayers to cover uncontrolled cost increases in delivery—and it will not produce an overall improvement in folks’ health.

    The mantra that healthcare is a right is lie perpetuated by many and unfortunately being grudgingly accepted by D.C.—the U.S. cannot tolerate/accommodate another entitlement and manufactured right.

    Chief Justice Roberts fumbled the ball with his convoluted, pretzel-logic decision. He could have put a stake in the heart of Obummercare but caved. It’s a shame one person caused so much conflict, turmoil, and cost to taxpayers. Govomit solutions have never and cannot result in effective and efficient outcomes—only the market/private sector can. Let it force healthcare costs down and insurers to adjust their premiums/deductibles/coverages accordingly.

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    1. Dear Tuna, my reply might seem overly academic but what the hell -- call a professor a professor. I learned in economics there is something called market failure. Even conservative economists recognize market failure and support a limited role of government in addressing them. So to say that government regulations have never improved market outcomes seems extreme to me. Government is pervasive in most places around the globe and here at home. To think that all of that activity is wasteful is a stretch. But when it comes to healthcare -- and healthcare in America -- I agree that perhaps more competition ought to be tried. I don't like most of Obamacare so I would change it by introducing less regulation and more competition. So we definitely agree on that. And Single Payer as envisioned by some is clearly off the table in my book.

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    2. How did we get here from the 40s & 50s? sicker people? People able to last longer but not healthier? Feds toying with market dynamics? financial institutions attracting insurance company investments? Lower or flat incomes compared to skyrocketing healthcare prices?

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