(In which we mostly belabor the obvious.-PB)
How much health insurance do most people need for most of their lives? The answer is none. Most people are fairly healthy and have mostly healthy children who could probably manage to go years between visits to the doctor. When they do go, it is mostly for a minor self-limiting complaint or a long-term health problem that is under good control. Insurance, and forgive me for belaboring the obvious, is supposed to ameliorate the effects of unforseen and and rare events which a visit to the doctor for a cough or an ear infection is most certainly not. We insure our houses against fire, for example, not because fires are common but because the cost of rebuilding a house, the repository of most people’s wealth, is more than most of us can afford to pay. There is no such thing as “lawn mowing insurance” or “garage floor painting” insurance because these tasks are routine and an expected part of home ownership. Putting on a new roof stings a little, I admit, but most normal maintenance of a home won’t bankrupt anybody.
The trouble with health insurance is that it’s not really insurance at all, at least not how most people view their other kinds of insurance. Rather than serving to protect us from the catastrophic financial effects of a major illness, health insurance has become an expensive middleman between the consumers and producers of medical services. If your car needs an oil change, you change it. If you need new tires you buy them. If you need to go to the doctor for your annual physical however, you engage a complicated bureacracy which exists to shift costs from one set of consumers to another. This is why the health insurance for a typical family may cost them or their employer in the neighborhood of twelve to fifteen thousand dollars per year even though their actual expenditures for medical care in any given year are not even close to that amount.
Routine health care is not even completely covered under even the most expensive health plans. There is always a copay and a lot of essential services that the typical family really needs, such as dental and vision, are either not covered or involve an even bigger copay. It has to be this way because health insurance is a ponzi scheme with hordes of investors at the bottom of the pyramid paying the dividends of those at the top who are, in this case, the extremely sick and the uninsured.
It wasn’t always like this. Our current model of health insurance is the result of two historical trends, the first of which was the explosion of medical knowledge and technology in the 1960s. Before this time medical care was relatively cheap because there wasn’t really that much that could be done. Hospitals were more like hotels than the patient processing plants they are today and the amount of doctoring received by a patient was limited by the amount of doctoring that could actually be done. This also limited the number and sophistication of the support staff and equipment required for a typical hospital or clinic. Health insurance before that time was rare and most people payed out of pocket for their doctor visits. It was just expected. Society had not been medicalized and people grew old and died without fanfare because there was nothing else to do.
This is not the case today where our ICUs and nursing homes are filled with the warm dead, people who in many cases are only kept alive at the end of a long and expensive journey through the medical system by increasingly expensive and futile medical heroism.
So there is no question that the real cost of medical care has increased, on the high end anyways.
The other trend was the incredibly high top marginal income tax rates which began to rise in the 1920s, peaked at 94 percent in the forties and, before President Reagan (PBUHN) took an axe to them in the mid-eighties, had stabilized in the high seventy percent range. The result was that increasing the pay of white collar and skilled labor in the post-war boom wasn’t much of an incentive as a raise was often eaten up by increased taxes in the higher income brackets. This was the age when companies started offering fringe benefits to their employees in lieu of increased salaries. One of these was comprehensive health insurance which has now become an expected part of the compensation package for any good job even though the original rationale for offering it has disappeared. Most people would probably be better served if they got the raise and payed for their own medical care as the marginal rates are not nearly as high as they were forty years ago.
The income tax is progressive of course, and the middle-class hardly pay any compared to the upper middle-class and the wealthy. In this case, there would seem to be even more of an incentive for middle-class employees to prefer the money over the insurance. Money is money. Insurance is wasted money unless you need it.
The unfortunate consequence of almost universal health insurance (because 85 percent of Americans are covered under some insurance plan or another) is that the true cost of health care is masked from the consumer. Everybody complains about the cost of medical care but it is a generalized, non-specific complaint. The high cost of medical care is an abstraction to most people most of the time. They have the occasional hospital stay, pay a small fraction of the total bill, let insurance handle the rest, shrug their shoulders and move on. The poor and the government-insured care even less because they are never expected to pay much, if anything, for most of their medical care. If the insured had to pay the complete bill the cries of outrage would send fear and panic through the entire health care industry.
The Big Lie, the scare tactic used by the usual suspects in their craven lust for political power is that people need comprehensive health insurance. They most certainly do not. Most people most of the time need so little medical care that most of the money spent either by them, their employer, or the government is wasted as far as it benefits them. Consequently, In a country where almost everyone can borrow money for automobiles, personal watercraft, and all manners of luxury items, there is no reason why most of us should not be expected to pay for most of our medical care most of the time (even if we have to borrow a little). No reason, that is, except that we have been conditioned to expect it for free. Not to mention that to merely suggest that maybe, perhaps, just possibly, a visit to the doctor is no different from a financial point of view than a visit to the hair salon would be political suicide for anyone with the guts to say it.
It’s easier to give other people’s money away, and more gratifying too because it earns one the reputation for being compassionate even if the long term consequences are harmful to the public.
There is the difference between what people want and what they need. While everybody wants somebody else to pick up the tab, the tab is going to bankrupt the nation. What most people need is an inexpensive high-deductible insurance policy to protect themselves against financial disaster if they should require some big-ticket medical care. Almost nobody, for example, can afford a kidney transplant or even the medical consequences of a serious car accident. Not to mention that people do grow old and eventually, many but not most, will require the expenditure of fairly large sums of money to preserve their quality of life.
The key thing to keep in mind is that the various plans proposed to insure the entire nation will do nothing to lower the cost of medical care because they are just another scheme to shift the costs from one set of consumers to the other. The only difference will be that instead of half, every single health care dollar will take a trip through the federal sausage mill. The money is going to come out of somebody’s pocket and it’s not going to be the government which has no pockets, just hands to grab from one to give to another
It’s just rearranging deck chairs on the Titanic. Twenty years from now when medical spending has doubled as a percentage of GDP the same people will be crying the same tears over the same problem because the entropy of government winds down to expecting less and less of the people while trying to give them more and more. This is why the concept of Health Savings Accounts (not to mention privatizing Social Security) invokes such howls of rage from our ruling elites. Not only do they hold the people in contempt thinking them incapable of planning for their own future but the money tied up in these accounts and owned by citizens is just another chunk of money that cannot be stuffed into the voracious maw of the political influence machine.
As for the poor, well, we live in a society that is both opportunistic and compassionate. It would be demoralizing to our nation to have the disparities of medical access so wide that the poor and ignorant suffer or die from conditions that those who can think and plan ahead easily eacape. We will, unfortunately, always need to give medical care as charity. But the key here is that primary care is no bargain. The connection between good health and acccess to primary care is tenuous. The factors which contribute to poverty and ignorance also contribute to poor health and we have been fighting those since the Johnson Administration with little or no success. Bad health in the poor is mostly a the result of social problems which have shown a surprising resistance to huge doses of federal dollars. Dumping even more money onto the poor is mostly the same as trying to treat a disease with an antibiotic to which it is resistant. Staph Aureus laughs at your ineffectual pennicilin. The poor will laugh and ignore your ineffectual primary care.
What the poor need is the same as everybody else. Major medical insurance for which, if it absolutley must, the goverenment can pay. We certainly pay enough to support the poor now. May as well spend it where it will be effective, that is, on management of the acute health problems that people who don’t think and plan ahead are going to get no matter what we do. To hell with it.
There are many conflicting forces in medical care, each one trying to stiff the other with the bill. The insurance companies want to pay as little in claims as possible which is understandable given the nature of their business. The medical industry, from physicians to the lady mopping the hospital floors, would like to get paid fairly for their services. The government wrings its hands at the cost but at the same time would like as many people dependent on government as possible. The people want all the medical care they can eat but they want somebody else to pay for it.
Nobody else can pay for it unless we become a nation with a government whose sole function is to provide health and other benefits to a universal dependency class in some decaying freeloader heaven.