Opinion

Health Nuts

By Josh Feit January 4, 2010

Unlike most liberals, I've never been breathless for the Public Option.

But this clear and belated editorial by James Surowiecki in the current New Yorker—laying out the contradiction of dealing with our failed health care system while still kowtowing to America's pathological anti-government bias—landed like an MRI machine on my head.
So where’s the contradiction? Well, Congress’s support for community rating and universal access doesn’t fit well with its insistence that health-care reform must rely on private insurance companies. After all, measuring risk, and setting prices accordingly, is the raison d’être of a health-insurance company. The way individual insurance works now, risk and price are linked. If you’re a triathlete with no history of cancer in your family, you’re a reasonably good risk, and so you can get an affordable policy that will protect you against unforeseen disaster; if you’re overweight with high blood pressure and a history of heart problems, your risk of becoming seriously ill is substantial, and therefore private insurers will either charge you high premiums or not offer you coverage at all. This kind of risk evaluation—what’s called “medical underwriting”—is fundamental to the insurance business. But it is precisely what all the new reform plans will ban. Congress is effectively making private insurers unnecessary, yet continuing to insist that we can’t do without them.

The truth is that we could do just fine without them: an insurance system with community rating and universal access has no need of private insurers. In fact, the U.S. already has such a system: it’s known as Medicare. In most areas, it’s true, private companies do a better job of managing costs and providing services than the government does. But not when it comes to health care: over the past decade, Medicare’s spending has risen more slowly than that of private insurers. A single-payer system also has the advantage of spreading risk across the biggest patient pool possible. So if you want to make health insurance available to everyone, regardless of risk, the most sensible solution would be to expand Medicare to everyone. That’s not going to happen. The fear of government-run health care, the power of vested interests, and the difficulty of completely overhauling the system have made the single-payer solution a bridge too far for Washington, and for much of the public as well. (Support for a single-payer system hovers around fifty per cent.) That’s why the current reform plans rely instead on a mishmash of regulations, national exchanges, and subsidies. Instead of replacing private insurance companies, the proposed reforms would, in theory, turn them into something like public utilities. That’s how it works in the Netherlands and Switzerland, with reasonably good results.
Share
Show Comments

Related Content

Best of the City

Top Doctors 2022

09/07/2022 By Seattle Met Staff

Modern Medicine

Rise of the TikTok Doc

09/06/2022 By Angela Cabotaje