At Bloomberg View Tyler Cowen jumps aboard the “single-payer won’t solve our problems” bandwagon with me:
Americans love their personal consumption, and household savings rates have been mostly falling since the early 1980s. Those are long-term cultural trends that no health-care policy will reverse. We should be grateful for whatever cost control we can get, because it is running counter to some fairly fundamental principles of the American economy and what the American people expect out of life.
Furthermore, we shouldn’t take the lower health-care spending in many European nations as a sign of better health-care policy. It’s a reflection of a broader cultural difference. If the U.S. someday did move to a single payer system for health care, it probably would be a relatively expensive version of that idea. The U.S., of course, does have a partial single payer system through Medicare, and it is still more expensive per beneficiary than its European equivalents.
What those who believe that a single-payer system is the solution to our problems should ask themselves is, since education is for all intents and purposes already single-payer in this country, why do we spend so much more per capita than any other country in the world on education?
That leads naturally to the question then what is the solution? Health care spending is rising at a multiple of incomes or growth outside health care and, since between 60 and 70% of health care spending is government spending in one form or another it’s dependent either on the non-health care economy or borrowing. If it cannibalizes the non-health care economy, that means the rest of the economy becomes less able to support health care spending over time. Our level of public debt is already such that it, too, is reducing economic growth so borrowing is no solution, either.
We’ve either got to change how health care is distributed or how it’s provided. You can’t have artisanal production of goods sold to a mass market. Either the production or the market must change.
I added up the numbers recently – between Medicare, Medicaid, the VA and Tricare, about 140 million Americans receive some kind of single-payer health care. Congress has repeatedly balked at controlling spending in those programs, so….
Andy- The only one they are willing to cut is Medicaid, the one that is already the cheapest.
I have been in agreement with this for a while. There is nothing magical about single payer. If you have the will to cut costs and spending you can do it with single payer or some other system. I would disagree with Cowen just a bit and say that I think that the European systems probably do represent better policy, mostly that in those countries people are pretty much all in the same system. They are also, or at least it is my impression, much better at not paying for care that doesn’t accomplish much. (IOW, they are willing to make tradeoffs.)
Steve