This morning Rannesh Ponnuru has an op-ed in the New York Times in which he considers the issue of universal healthcare coverage. I believe he does a pretty fair job of laying out and critiquing the practical case:
The practical case is that uninsured people raise premiums for everyone else. But such cost shifting raises premiums by 1.7 percent at most, according to a 2008 study published in the journal Health Affairs. Reforms that increase the number of people with health insurance, while stopping short of universal coverage, would presumably make that small percentage even smaller.
the moral case:
The moral case for universal coverage is that we have an obligation to see to it that the poor and the near-poor have access to good health care. But universal coverage is only one way of realizing that goal, and not necessarily the best one. For people with pre-existing health problems, for example, direct subsidies would probably be more efficient than rigging insurance markets to make sure they are covered.
and the political case for universal coverage:
The political case for universal coverage is based on the assumption that voters want it. But people’s preference for universal coverage is not as great as their desire to reduce health care costs, a Kaiser Family Foundation poll found in late 2007. So it’s not clear that people would accept higher taxes, mandates or the prospect of rationing health care one day just to make sure that every individual is covered.
Consistent with the poll found above while I agree that our healthcare system has fundamental structural problems I believe that the primary symptom of which people complain is its high cost. And high insurance costs follow from high healthcare costs they aren’t the primary cause of high healthcare costs. If insurance costs were the primary consideration in high healthcare costs our total expenditures for healthcare would be 15% lower, the difference between our insurance burden as a percentage of healthcare costs and Canada’s. But we don’t pay 15% more for healthcare than other industrialized countries we pay 300% more.
Defensive medicine, malpractice insurance costs, and litigation costs are all tempting explanations for our high healthcare costs but they’re not large enough either individually or in combination to explain our high costs.
The sad truth is that our healthcare providers make 300% of what their French (for example) counterparts do and salaries are the main component of healthcare costs. Unless you believe that American healthcare providers will take a voluntary paycut neither universal coverage nor Mr. Ponnuru’s preferred market solutions will make a damned bit of difference.
That’s why my own preferred solution to the problems of our healthcare system is a dramatic increase in the supply of healthcare, particularly in primary care. I don’t see any other alternative that will produce the desired results.