Problems with our current health-care system:
- People who can't get health insurance because they are poor or have pre-existing conditions delay routine medical treatment until they reach a crisis. Then they seek emergency medical care which the hospitals are required by law to provide. The hospitals pass along the high costs of this crisis-care to people who have insurance, inflating their premiums. Not only does this cause pointless suffering, but it's also a really inefficient way to run a health-care system.
- Some young, healthy people who could afford health insurance forgo it because they think it's unnecessary. The trouble is, the insurance pool needs more healthy people to dilute the costs of those who are older or sicker. Plus, when those uninsured young people have accidents that generate catastrophic medical expenses the hospitals have to treat them, and the costs get passed on to those with insurance.
- People in the U.S. pay more and get less for their medical care dollars than just about anywhere else in the world. There are many reasons for this, including Doctors that order unnecessary tests and procedures for fear of getting sued, drug companies that get Americans to subsidize R & D for the rest of the world and a medical billing system that is completely opaque. To the last point, insurance is a great thing, but it can hide the true cost of care because people only pay attention to their out-of-pocket expenses, not the total bill. In fact, medical care is probably the only expense where Americans don't find out the cost until after the work is done.
- Medicare is already adding a huge burden to the federal budget, and the flood of baby-boomers coming down the pike is only going to make matters worse. Without big cuts or tax increases the system will go broke.
Some good things the Senate health care bill does to address the problems:
- It creates a mandate for people to buy health insurance and for large companies to provide employee plans, with penalties for those who don't comply. This should let insurance companies dilute the costs of medical care among a larger, healthier group of people, and lower insurance rates for everyone. It also creates insurance exchanges for individuals to save money by purchasing coverage at group rates.
- It subsidizes insurance premiums for poor people, and stops insurance companies from denying coverage to people with pre-existing conditions. This seems to be a bad deal for taxpayers who subsidize the poor and insurance companies who have to take on expensive customers. Remember, though, the longer these groups go without routine medical care the more expensive they get. It's a matter of pay a little bit now or a lot more later.
- It makes high-dollar "cadillac" health-care plans more expensive. They will still be available, but their price will reflect more of the plans' real impact on the health-care system.
- The bill creates a firewall between taxpayer dollars and the funding of abortions. This provision doesn't really address any problems with the system, but it's a good idea if you don't want millions of people becoming tax-protesters. It's also the right thing morally IMO.
Problems with the Senate bill:
- Even proponents of the bill estimate that after passage, 24 million people under 65 will remain uninsured, including 8 million illegal immigrants. That's still a LOT of unreimbursed emergency room costs that will continue to be passed on to everyone else. Unfortunately, no politician wants to touch the illegal immigration debate.
- Since penalties for failing to buy health coverage will max out at only $750, many people and businesses will find it cheaper to pay the penalty than get the insurance. That means that even more than the estimated 24 million people may keep resorting to expensive crisis-care. If they don't get the details right on this one, the whole bill will be worthless.
- The bill doesn't do anything to control medical costs. There's no tort reform to stop defensive medical care. There's no reimportation of drugs from other countries to keep the costs of prescriptions down. Finally, there's nothing to make medical costs more transparent to the consumer, or bring more market-based price pressure into the medical system. Without an additional bill to address these issues, costs will keep going up. By the way, I think the idea of capping doctor's salaries is terrible, and doesn't bring us any closer to a more efficient, market-based system. Do you legislate the salary of that plumber who fixes your leaky pipes? No. You find the cheapest guy who still has a reputation for doing quality work. If Joe the Plumber can earn six figures by working hard, that's his business. Likewise, if there are only a few doctors who spent the years learning some advanced procedure, they are entitled to earning what the market will bear for their services.
- The bill may not be deficit neutral, in spite of what the Dems say. The Medicare cuts in the bill are not produced by any actual increase in efficiency or decrease in fraud. They are simply written into the bill, as in "Medicare will be cut by X amount." There's a good chance that when seniors turn the heat on the politicians, those cuts will quietly go away.
- The bill raises some taxes to help pay for the subsidies, which is never a good thing to do in the middle of a recession. Some of the taxes have a narrow scope, like the surcharge on tanning salons. Other taxes hit a much broader slice of the population.
- Some parts of the bill may be unconstitutional. Forcing some states to subsidize the medicare costs of other states is already being challenged. Also, the whole idea of forcing citizens to buy something from a private company just because they are alive may not pass muster. This is the issue that conservatives have rallied around most to try and kill the bill. I think their effort is misguided, though. I'll leave the constitutional question to the courts, but to me it's a question of paying for what you use. If we lived in a country where some fool who would rather buy an X-box than pay for health insurance was left to die on the street, then I wouldn't have a problem with letting people make their own choice. The fact is, though, when that fool wrecks his car and wracks up millions in medical costs, I pay for it in inflated insurance premiums. You don't like forced responsibility? Then don't ask me to bail you out.
If I had to rate the Senate bill overall, I would give it an "I" for incomplete. If you put aside the paranoia, the basic principle behind the bill is solid. However, if some of the details of the bill aren't fixed, I will have to change my rating from incomplete to incompetent.
