Would universal healthcare be more expensive or less than the current US system?

Great Debates
61

I don’t think it is. Many of those pushing for UHC say that we can cover everybody for less. It is advertised, IOW, as something for nothing. I have already presented my reasons for thinking that it will cost more, not less, to cover everybody at the same level they enjoy now.

I doubt it will work that way.

Recall a few years back that insurance companies began sending post-partum mothers home after a 24 hour stay in the hospital, instead of 48. There was a huge brouhaha, and some state legislatures passed bills requiring insurance companies to cover the whole 48 hours. Not because of medical necessity - there was no major difference in post-partum outcome from a 48 vs. 24 hour stay. And it saved money. But it wasn’t popular. The insurance companies were willing to say No. The politicians weren’t.

That’s the kind of thing that Americans expect.

Just like in Canada. Do you need a cite?

And free vaccinations mean that inner city children are more likely to be immunized than anyone else, and this saves a lot of money. Except they aren’t, and it doesn’t.

That’s certainly true. I forget who the person was who said “Half my advertising budget is wasted. The trouble is, I don’t know which half.” But, as the 24 hour maternity stay shows, we can be reasonably certain that something will save money, and have only minor effects on people’s health - and still not do it.

I have a relative who is a neo-natologist. She runs an NICU, and exerts all the powers of a considerable intelligence on a patient population in the inner city. A substantial majority of her patients die. Of those who do go home, most do so with significant deficits, in hearing, brain damage, blindness, hyaline membrane disease, etc. Nearly every one of them is paid for with public money, or charity - hardly any of her patients have health insurance.

If we implement taxpayer-funded UHC, are we going to be able to save money on her NICU? Is a politician likely to say, “only treat the ones who are likely to recover. Medicate the rest and leave them on one side.”

Or will we do what we are doing already - succumb to the inevitable pressure and spend incredible amounts on all of her patients, so that 10% or less can go home to some semblance of a normal life?

Her husband used to run the tuberculosis program in the inner city. Treatable tuberculosis requires that the patient take medications regularly for months or years in order to be cured. Hardly any of his patients stayed on their meds long enough to be cured, despite the fact that their care was subsidized and would have saved money as well as prolonging and improving their lives. Here we have UHC in miniature - “free” preventative care, that actually helps people and saves money too. But they don’t take their meds, so it doesn’t work out like it is supposed to.

Who is more likely to cave and spend the dough - a heartless insurance company exec responsible only to the shareholders, and with a jaundiced eye fixed firmly on the bottom line and his bonus, or a politician who has to rely on the good will of his constituents if he wants to keep his job come election time?

IYSWIM.

Regards,
Shodan

62

Are you saying there won’t be rationing or that UHC proponents are not highlighting rationing? UHC opponents don’t highlight rationing in the current system either.

Don’t you think it is easier for the politicians to tell the insurance companies to spend their money this way than to actually increase the money they have to allocate? If I remember the fight, a lot of it was quality of life issues, btw.

First of all, we’re talking flu vaccine here, for high risk patients, sure, but still not the kind of thing I’m talking about.

From your cite, it seems that the centers weren’t measuring success rates for their patients, but rather from the community. No, I don’t think that the minute we have UHC people will flood to the doctor. It is going to take a while to build habits of regular visits. From your cite:

Why this discrepancy? I’d say because privately insured children have the habit. (I wonder what the overlap of this group and white children is.) I don’t know for sure, but my impression is that the quality of service under Medicaid is worse than under private insurance. Which brings up an important point - if UHC is underfunded, to save money, it can easily turn into a shithole. That is a danger, especially if those ideologically opposed to it start to run it. See SEC.

All excellent points. How many of these people were raised in an environment in which a trip to the doctor was long and arduous? How many pregnant mothers get the same sort of care ones with insurance get, and get instruction on good health during pregnancy? On the other hand, surely there are some responsible people out there who would make use of this now affordable care in a heartbeat.

Sure some people are not going to take advantage of improved health care - but some people with insurance don’t now. I know people who keeled over dead from perfectly treatable disorders. It could easily have been me, since my heart problem had no scary symptoms, and even when I found I had a fluttery pulse I was sure it was nothing. If I had to make a decision between food that week and going to the doctor, food would have won in a second. UHC is not going to produce a nation in perfect health, but it will help. After all, there is getting to be quite a population of the poor in Europe also, but they still are beating us.

63

It doesn’t matter? Really? I would think that the fact that countries with private banks did better than countries where banks are owned by the state would be a pretty good indicator. But if results don’t count then by what stick do you measure? The fact is that countries with nationalised banking and industry have done pretty poorly.

Also, as much as some would like to throw out the baby with the water, this crisis is not a result of too little nationalisation but a result of insufficient and/or bad regulation. Countries with private banking and better regulation have had few, if any, problems.

You are mixing things. Regulation is necessary, freedom of the market is just as necessary. I have spoken in favor of both.

They immediately privatised them again. That’s the lesson they preach. It was an emergency measure not a way to run the economy in normal times.

Maybe Cuba is the country you are looking for. Even in Europe banking is not nationalised and could not be. The EU is clearly moving in the opposite direction.

I am not speaking in favor or against UHC. I have no definite position on that. Countries are different, people are different, circumstances are different. Some things might work if accepted by the people and fail if rejected. It is not only a matter of economics but of many other factors, culture among them. America is not Europe. Europeans pay more in taxes and have the government regulate their lives more. Europeans have UHC but also have a culture of more government intervention, no need to be armed at home, etc., Things which would not fly in America. Whether one prefers more or less intervention of the state is a matter of personal preference and a value judgment but Americans are not Europeans.

64

Are you aware that this situation is the direct result of government intervention that gives employer-subsidised health cover a significant tax advantage over other methods?

65

Yeah, I am aware of these. But after some thought, I don’t understand your objection. After all, insurance providers must also have money available for the patients, available on demand. So how is my savings account less efficient? Less efficient than what? Can you elaborate more, please?

In what sense is a big problem not a “catastrophe” to be covered by “catastrophe insurance”?

If nothing will do it, perhaps not everyone thinks it is worth the money, time, or effort? Then why force these people to pay into a system they will not use, a system which removes market forces from operating on prices?

66

I’m saying there will be rationing, but UHC proponents are often pretending that there won’t be - by claiming that we can cover more people at the same level of care that they now receive for less money, and without making any hard choices. That, I don’t believe.

Either there will be rationing, in the sense that some people currently covered will have to accept a lower level of care, or there won’t be rationing, in which case we will not save any money.

I think it is easier for politicians to spend tax payer money than insurance company executives.

Which is how all the arguments for spending more under UHC than we do now will be framed.

“We don’t want to spend money on X. It costs too much.”
“OMGthinkofthechildrenitwillimprovetheirlifeitisonlyafewmillionheartlessmonsterdon’tletbabyJessicadie!!!”

In other words, we can improve the coverage of Medicaid patients to the same level as for those now with private insurance, which will cost more money, or reduce the level of service for those with private insurance to the level of Medicaid.

Again, then, almost by definition, UHC will either reduce coverage or cost more. Which was my point.

Then you and I are in agreement - if the attempt is made to save money under UHC, it can easily turn into a shithole.

I don’t think Americans will tolerate a shithole for their medical treatment. Therefore, however much they may support the idea of saving money in theory, they will not support it in practice. And therefore, I doubt that UHC will save any money.

Regards,
Shodan

67

That’s not necessarily the case in UHC either. In the UK for example, waiting lists are much longer in high population areas than in rural areas. If you live in the country, you get treated right away, and if you live in a big city, you get to wait. Rationing by postal code.

68

Many years ago our hospitals were not for profit. Much was provided by churches and non profit organizations. Even Blue Cross was a non profit in the beginning. It was just too much money for business to pass up. When you can charge people for something they desperately need ,you can clean them out and they will thank you if they survive.
I saw a program of food additives which are legal here but not in the EU. The government has a stake in keeping it’s people healthy. Cutting back on cancer producing agents in food and toys ,will save them money ,in the long run. The Union is rejecting American products that have chemicals they do not approve. China and some other producers are falling in line. But in a weird reversal, companies that have tainted products ship now them to the U.S…

69

In the US it is often the opposite, as rural areas have a hard time attracting doctors because of the small population and the lack of opportunity for specialization. I understand that the government offers incentives, such as forgiveness of med school loans, for being a GP there. Cities attract far more people, though maybe not the poorer areas of cities.

I’d think that there would be an excellent business opportunity under UHC to open clinics in poor areas now underserved, since you’d have plenty of customers and would no longer have any problem getting paid.

70

Rationing and serving more people for less money are not mutually contradictory. And I’ve never heard anyone say there will be no hard choices - not anyone engaged in a serious discussion, anyway. What I mostly hear is denial of the rationing that now exists.

Again, not mutually contradictory. If you carefully check sales to save money, that doesn’t mean you get to buy whatever your heart desires.
Sure the level of care will go down for some, and probably for me. However the average level of care will go up. Simple math. We might be able to figure out a way of pouring resources into the underserved today, without changing the level of expensive insurance, but that would be overly expensive. Done right this doesn’t have to be a zero-sum game, which it seems you are assuming, but even so some people still lose some.

On the other hand, Medicare does just fine. Medicaid problems stem, no doubt, from the population being served, and some from the fact that the poor aren’t as effective a voting block as the elderly. And think of the payback of public health initiatives when the benefits go to the taxpayers in terms of lower costs.

No they won’t - but they might turn out the people who mismanaged it, instead of rejecting the idea. If the past 8 years has shown us anything, it is that it is easy to appoint incompetents who will make any program look bad. If a President appoints someone to head UHC who feels, as you do, that it is guaranteed to fail, it will fail. That was my point. Competitive analogs show UHC does save money and improve outcomes - and nothing you have said refutes this data.

The daughter of some friends of ours is just out of college,and she is paying over $300 a month for insurance while she looks for a job. My daughter, as I mentioned, is in Germany, and paying 70 euros a month for medical, dental and drug coverage. They are the same age and both healthy. I can’t believe that there is nothing we can do to close this yawning gap. We might not do quite as well as Germany, but 4X worse?

71

Delphi, an auto supplier just went to court to get out of their medical contract for 15,000 retirees. Contracts mean nothing. The retirees are at an age where they will have great difficulty getting coverage. They will have problems paying for it ,if they can buy it. If they are sick, they are screwed.
If you get laid off you will have to spend 80% of your unemployment to pay for Cobra coverage. This system is cruel and selfish. It rewards the wealthy and punishes the poor. It is a perfect analogy of a capitalistic system that allows corporations to run it.

72

It seems as though this is at least partially true in the US as well.

Anyone who has needed specialist treatment in the US knows how much of a hassle getting an appointment can be (not to mention expensive), only to be referred to a different specialist. Further, waits in our hospitals and ER waiting rooms are atrocious even outside large urban areas.

Just a few months ago a woman collapsed in a ER waiting room and died several hours later, just laying on the floor in the middle of the room. That was an extreme case of negligence, sure, but the amount of time she needed assistance was clearly already less than the amount of time the hospital had for her.

Anecdotally, I can’t tell you how many times we’ve been to the ER waiting room and seen people just get up and leave after 3 to 4 hour waits.

However, all of that is kind of beside the point of my original question.

To narrow it further, has anyone been able to show that the increased tax burden from a UHC system would be more expensive (and more damaging) to our budget than the current system? Because I haven’t noticed any evidence to that effect, yet.

73

And it isn’t like the UK and Canada don’t have “bad” neighborhoods and the problems that go with them. Yet, they don’t have that as extensively as we do in the U.S. They also don’t have the same income disparity we have. To make UHC viable it might be necessary to deal with that issue to begin with, and after it just might be that the American way is the best way after all.

But beyond the issue affordability, prospective insureds can be effectively barred for such things as bad health, or a bad credit score, which now seems the standard distillation into three digits of someone’s character and worth as a human being. Increasingly that’s used as a litmus test in all sorts of transactions that really aren’t credit transactions to begin with.

Just today I had the startling realization that insurance companies, employers, and landlords couldn’t have come up with a better mechanism for limiting access by certain demographics, which tend to have worse credit histories than average, if they’d tried.

And as for the unhealthy, well, some time ago we had to take a stroll through the great free market of health insurance. As appalling as it may sound, it is evidently standard practice to evaluate your health on how many prescription drugs you take. We were told by one company that if you took three or more you were disqualified. But, if you go without one of the drugs for six months or so, they might take you after all. So let’s see–do you give up the blood pressure medicine or the statin? The system that doesn’t force people to make that choice wins, in my book.

74

In the UK, to all intents and purposes the banking system is becoming nationalised as the endless bailouts make the government the largest shareholder. And China is doing pretty well. But you are right the issue is not nationalisation but regulation of the financial sector.

In health though it is a question of values and efficiency. And I see no evidence that a system built around making private profits is better than UHC. All the evidence from outcomes show otherwise (Shodan et al’s fantasies about the unique genetic weaknesses of Americans notwithstanding).

The USA’s private system gets worse outcomes for higher costs than UHC’s Western Europe.

75

I think that Nationalized Health is an excellent idea that is devilishly hard to implement.

As one might imagine, people out there make a living studying this subject. A quasi-neutral view is available from the UN’s World Health Report 2000 Chapter 2(200 kb pdf).

Part of the difficulty in this discussion is that we are talking about assessing a health system as good/bad, 70% vs. 90%, and the like. The UN report above contains some ideas that will help in that regard. The first is:

[QUOTE=World Health Report 2000 Ch. 2]
To assess a health system, one must measure five things: the overall level of health; the distribution of health in the population; the overall level of responsiveness; the distribution of responsiveness; and the distribution of financial contribution.
[/QUOTE]
One single measurement is meaningless. We can’t say that one system is “good” or “bad”. Each one scores differently on each of the UN’s five scales.

Further on in the text, “responsiveness” is defined:

[QUOTE=ibid]
Responsiveness is not a measure of how the system responds to health needs, which shows up in health outcomes, but of how the system performs relative to non-health aspects, meeting or not meeting a population’s expectations of how it should be treated by providers of prevention, care or non-personal services.
[/QUOTE]

So far, so good. Where it gets interesting is in the statistical annex(400k pdf).

Here’s Table 9:

[QUOTE=WHR2000 Annex]
Overall health system attainment is presented in Annex Table 9. This composite measure of achievement in the level of health, the distribution of health, the level of responsiveness, the distribution of responsiveness and fairness of financial contribution has been constructed based on weights derived from the survey of over one thousand public health practitioners from over 100 countries.22 The composite is constructed on a scale from 0 to 100, the maximum value. As explained in Box 2.4, the weights on the five components are 25% level of health, 25% distribution of health, 12.5% level of responsiveness, 12.5% distribution of responsiveness and 25% fairness of financial contribution.
[/QUOTE]

Now, I have some problems with their changing the names, and calling a “distribution of financial contribution score” a “fairness score”, and I can think of improvements in the way that they rate responsiveness, but hey, it’s the best we’ve got.

This is a composite measure of how well countries meet the health needs of their populations. It gives a score from zero to one hundred, with one hundred representing the top score on all five scales. Here’s the results:


Japan                         93.4
Switzerland                   92.2
Norway                        92.2
Sweden                        92.0
Luxembourg                    92.0
France                        91.9
Canada                        91.7
Netherlands                   91.6
United Kingdom                91.6
Austria                       91.5
Italy                         91.4
Australia                     91.3
Belgium                       91.3
Germany                       91.3
United States of America      91.1

Japan is the clear outlier, perhaps because of its extremely heterogeneous population. What I found interesting was that the top fifteen countries were only separated by a couple percent, and excluding Japan, by 1%…

This means that those countries do about as good a job as can be done. Switching to a national health care system will not improve the overall level of care. This is not good news, because from there, the only way is down. We can’t go up much.

Now, all of the different countries scored differently on the various individual measures that go into the final composite score. The NHS systems, as you might imagine, scored higher on the “fairness of contribution” scale. Here’s what the UN says about that scale:

[QUOTE=ibid Ch. 2]
Fair financing in health systems means that the risks each household faces due to the costs of the health system are distributed according to ability to pay rather than to the risk of illness: a fairly financed system ensures financial protection for everyone.
[/QUOTE]

You recall I said I had problems with this. Mostly, it’s the assumption that one system is “fair” and the other is “unfair”. A fair name for what is being measured was in the quote from Chapter 2. There it is called the “distribution of financial contribution”. In reality, it is just a scale. At the high scoring end, everyone pays based on income and sick people use the service more. At the low scoring end, people pay based on their state of health and sick people use the service more. I can make a reasoned and cogent argument for both sides being fair. One argument goes “Why should I have to pay thousands of dollars to treat a life-long smoker for emphysema? That’s their problem.” The other argument goes “You pay for a policeman whether you need him or not. How is this different?” I’m not advocating for one or the other, not even sure which one I’d pick.

I note also that of the five measures, only the first four have to do with the actual health care delivered. The “fairness” score is the only non-medical score of the five.

Now here’s a statistical oddity for you. As you might expect, on the “fairness” scale, the US scores way down in the middle of the pack, way behind the NHS countries. Since it is within a percent of all the top performers (all of which but the US are NHS countries) on the composite score, this means it is in the middle of pack regarding the health-related part of the composite score.

This is a strange thing. It means that in some sense, health care at the top of the heap is close to a zero sum game. You can up the responsiveness, say, but some other aspect will likely suffer. Curious. This suggests that if the US changes to an NHS (which will dramatically increase our “fairness” score), it is probable that some combination of the level of health, the distribution of health, the responsiveness, and the distribution of responsiveness of the health system will decline. Hmmm … kinda makes sense in a world of limited resources, where all of those aspects of the actual health services costs money. More to one … less to another.

Finally, we know that the per capita expenditure of the US is high compared to the NHS countries. We also know that our actual health care score (the four actual measurements of the health care system) are right up there with the highest in the world. So in theory, and I emphasize in theory, there are some potential monetary savings to be had.

So my conclusions from all of this are:

  1. The possible improvements are thin. There is not a whole lot of head room from where we are. A change to an NHS system is extremely unlikely to improve our actual delivery of health care by more than a percent or so. However, it could easily decline from the changeover. That’s called downside risk, usually thought of as a bad thing.

  2. Theoretically there is money to be saved. However, it may result in poorer care.

  3. There’s not a whole lot of money to be saved. We spend about 13% of our GDP on health care, versus about 10% in most of the OECD NHS countries. It’s money, but it’s not game-changing money.

Finally, you have to factor in the people’s opinion of the Government. In the US, cheating the government is a national pastime. For historical reasons of the geography and development of the country, there is a general sense of the government as something far away, and when you see them you’re in trouble of some kind. Getting one over on the Government is seen as a good thing. Dodging the tax man, hiding your moonshine still from the Revenuers, smuggling whiskey during Prohibition, doing cash transactions to avoid sales tax, that’s the national religion.

Partly as a result of this, our Medicare/Medicaid system is shot through with overbilling and fraud. People figure they’re not really cheating anyone, it’s just the Government.

Which of course means that we may never see a penny of the theoretical savings possible from the changeover. And it is certainly possible that it could cost more than the current system. The precedent of the US experiment with Medicare/Medicaid is not encouraging in that regard.

So at the end, I figure it all boils down to the question of how we distribute the costs. If you think you shouldn’t pay for medical treatment for smokers and junkies, you go one way. If you think everyone is entitled to health care as a basic right in a modern society, you go the other way.

Because the total cost of the system, and the medical treatment of the system, near as I can tell, probably won’t change a whole lot. Other than changeover costs (which could be high, not something I’d want to take on today), we’d likely pay somewhere near the same amount, for somewhere near the same standard of care. The only difference is how the costs are to be assessed.

At the end, I think it is worth the experiment. I say this because despite what the numbers say, the medical system in the US is falling apart. American health care is good, but it can’t last. My wife is a Nurse Practitioner, so I’ve watched the change over the last thirty years. Doctors are going broke, hospitals are going broke, malpractice insurance is through the roof. A number of areas don’t have obstetricians, because they have been driven out by lawsuits. So overall, well, NHS can’t be too much worse, and might be better.

The World Health Report 2000 is a fascinating document. I encourage people to read it.

76

Sure. It is a matter of statistics. When you save for yourself and your family, you need to save enough for a worst case situation - that you run up charges until the catastrophe kicks in. Since that has to be done over a number of years, and because lots of people won’t have low probability disasters happen to them, a lot of money will be sitting in these low yield accounts. Insurance companies, because they have millions of clients, can accurately predict the payout for each year, and while I think they must carry reserves, it will not be nearly so big. There is a lot more variance in what your family pays for health care in a year than what a million families do. We go through this every year when figuring out how much to put in our reimbursement account, though it makes sense to lowball that a bit since if you spend more you are only out the tax savings while if you spend less you are out the money you put in. We have pulled in checkups and things to spend everything in a year.

But catastrophes cost more than finding a problem before it becomes a catastrophe. Clearly wem aren’t going to let people die, so we as a society are going to have to pay for this insurance one way or another.

I’m just saying that we are not going to get 100% improvement. I suspect there are plenty of low income families and pregnant women who would be happy to go to the doctor more than they do now.

As for market forces: since I actually believe in the benefit of market forces, we need to find an explanation why the market has done such a crappy job as compared to countries not depending on the market. Some conservatives will blame any and all problems on the slightest bit of regulation, which doesn’t explain why rigidly regulated systems do so well. I think the answer is that health care as a whole doesn’t have the characteristics that let the market operate effectively. Some parts, like elective low urgency procedures like LASIK and cosmetic surgery do, and I hope we let the market work there. ERs don’t. For whatever reason, pricing is a mess, with insurance companies driving lower prices than individual consumers or ones without big group plans. Whatever the reason, if the goal is worldclass results and costs, the market is not working. If the goal is maximizing insurance company profits, then maybe the market is fine.

77

Whoa. Where was this article when I was trying to convince people in the Pit that the government can’t be trusted to take good care of us?? :smiley:

78

That’s just it… health care for profit results in what we have. When you call the fire department, they don’t ask for your credit card number or if you have fire insurance.

I just had surgery in the Czech Republic. Some 20-odd doctor visits, pathology, blood work etc cost me about $400… no insurance involved as this was 100% of the doctors’ charges. I called from the US on a Friday, got an appointment in Prague for Monday and took a Saturday flight.

In the US, the same surgery would be nearing $10K with all the numerous follow-up visits that lasted for 6 weeks.

There was no problem getting access to doctors, but there is very little overhead in admin. The doctor has one secretary/assistant/nurse and does not have to deal with insurance companies.

79

Or any health insurance at all. I recently tried again to obtain insurance in the US. and was told by my broker:

“I have called several insurance carriers (Assurant, Golden Rule, Humana, etc) about your medical condition and unfortunately all of them said your condition is an automatic decline. They won’t cover you at all. There are certain conditions that cannot be ridered and the insurance companies just tell us brokers that the individual is not eligible for health insurance.”

I also tried via a group plan for my two-person company:

“unfortunately they don’t write groups smaller than 5 employees (there is no money to be made for them).”

So the system we have generates nice profits for the insurance industries which is what you’d expect from market forces, but it fails to deliver wide spread coverage.

Harry Reid and John Ensign both received yet another letter from me yesterday. I hope someday I can get coverage.

80

How does this – public health care – differ from basic education, where everyone in society contributes tax dollars to providing basic education for the children, regardless of whether or not you have children of your own? Isn’t this best for society as a whole?

Public schools aren’t run for profit: nor should they be. If you want to send little johnny or Muffy to a private school then you are free to do that, but you still contribute tax dollars to the public system.

I see basic health care as being exactly the same; everyone contributes tax dollars to the public system for basic and essential coverage, but if you want an MRI next week instead of six months from now you should be able to pay for that service out-of-pocket or have it provided by additional purchased insurance.

I am healthy and have been my whole life. I have absolutely no problems with the fact that I’ve probably contributed maybe $75,000 to $100,000 to the health care system over 25 working years and used very little in return. If one day I have a heart attack or need major surgery it will all have been worth it. And in the mean time anyone in the country can walk into a doctor’s office, a clinic or an emergency room and get treated without any questions, apart from “where’s your health card?”